A blog for all things retail and licensing.

Blending behavioral data with demographics to drive loyalty

Guest Blog by Millie Park

A recent Forrester report showed that compared to older generations, 18-to-24-year-olds don’t mind that their data is being shared online. According to the report, only 33 percent say they are concerned about access to their behavioral data. By contrast, 47 percent of 55-to-64-year-olds said they were worried about that kind of access. Also, the younger group is more willing to exchange personal data in exchange for discounts. Clearly, brands should target younger demographics to share data and make online purchases, right?  Well, not entirely. As the saying goes, actions speak louder than words.  In this case, actions speak louder than age.

Marketers are continuously trying to improve their understanding of demographics. That’s great, but in my opinion, this can also be limiting. This particular study doesn’t necessarily tell me that 18-24 year olds are the best demographic for retailers to target online. In fact, the glass is more than half full with the 55-64 year old demographic where 53% do see value in using online data. Uncle Ray is on Facebook, “liking” your products and services. Grandma Helen is on Pinterest pinning recipes and sweaters to knit.  Don’t succumb to the ageism trap – they are engAGEd. Think beyond targeting individuals based on demographics. Marketers should focus on blending demographics (like age) with customer behavior, preferences and purchases, to personalize the online experience and negate any concerns about sharing behavioral data. Prince almost had it right when he sang, “Act your age not your shoe size”. Marketers should USE your age AND your shoe size.

We’ve seen consumers flock to where they have a great experience, no matter the demographic. The same applies to online interactions. As a marketer, if you have profile data and/or collect behavioral data about visitors to your site, then use it to your advantage. Use it to drive that great experience. Use it to show the customer you know them. Use it to show the customer you care. Don’t use it to exclude or downplay age groups – combine it with demographic data to build a powerful customer profile. And if you are given the privilege of using customer data, treat it with respect. Don’t ask for it unless you’re going to use it and use it appropriately to drive a personalized experience. Remember, misuse and non-use of data will turn customers off – especially when it comes to explicit data customers give you, like preferences and birthdays.

All available data should be used to tailor offers and recommendations to individuals based on their history with you. How they interact with your site, what they view and search for, where they click, what they place in their carts, and ultimately what they purchase are all data points that you should fold into your personalization algorithms to use to drive the user experience. Continue to build an individual’s customer profile as you get to know them through various interactions. Add into the additional data like-demographics, product ratings, social data, and other third party data. Test to see what data truly moves the needle and what recommendations resonate with your customers. Now you’re really moving toward having your recommendations perform like a personal shopper.

By making it interesting and easy for the shopper to interact and transact with you, regardless of their age, you will be recognized with purchases and rewarded with loyalty. Age is nothing but a number. Loyalty lasts a lifetime.

Millie Park is Vice President and General Manager at ChoiceStream CONNECT

JWT Touches on Things to Watch in Retail for 2013

If you haven’t seen this yet, here is a little slice of JWT’s list of Retail – Things to Watch in 2013, brought to us by their JWTIntelligence center. You can find more on insights from JWT and JWTIntelligence at www.jwt.com, @JWT_Worldwide, www.jwtintelligence.com and @JWTIntelligence.

Ambushed by Amazon

The e-commerce giant started out as a threat to booksellers, but it’s fast becoming Enemy No. 1 to retailers of all stripes…Amazon will prove an “extremely disruptive force,” as Kantar Retail’s Bryan Gildenberg puts it, with the rise of “showrooming.”

B2C/P2P Partnerships

As the peer-powered marketplace continues to heat up, look for established brands to strike partnerships with fledgling peer-to-peer services…Both Gap and Pepsi Next recently held promotions with TaskRabbit, which helps users outsource tasks.

Click-and-Collect Shopping

Already gaining popularity in parts of Europe, “click and collect” melds digital and physical commerce by letting customers order online, then pick up the goods (frequently groceries) at a store nearby…A few U.S. retailers are testing the waters, including Ahold’s Peapod.

Clockless Day

As the pace of life speeds up and more people work nontraditional hours… Consumers want to continue with their lives 24/7, whether it’s eating, shopping, exercising, working, etc., and businesses will be expected to cater to those expectations.

Cutting out the Middleman

The success of vertically integrated e-commerce players…will spur a host of new niche brands that cut out middlemen and sell quality products online at below-market rates.

Dads in the Aisles

With women just as tied up with careers as men, and the ranks of stay-at-home dads multiplying, more marketers will lose their singular focus on moms…we’ll see market research taking the male perspective into account, goods retooled for male appeal and messaging that acknowledges the man’s changing role.

JWT also discusses the importance of Geofencing, Individual Attention, Online Groceries, Retailers Enable Recycling, Self-Service, Shopping Hotels, Tablet Shopping, Variable Pricing and Window Shopping.

Five Tips For Better Google Shopping PLA Performance

Guest Blog by Mark Simon

Paid Google product listings (PLAs) accounted for 17 percent of ad spend at the search engine this past Q4 2012. Across the entire search engine market, PLAs accounted for 10.7 percent of overall spend — almost as big a slice as that accounted for by Bing and Yahoo. PLAs – which power Google’s now-paid shopping service (formerly known as Google Base and Froogle) had only been introduced in October, so the spend ramp up was especially impressive.

Okay – we know that PLAs are working out for Google. But how are they performing for marketers?  Is there performance comparable to tried and true text ads? A report by Adobe comparing PLA to text ad performance in Q4 notes that PLA CTR is an astounding 34 percent higher than for text ads on Google’s SERP. But the same report found that AOV for PLAs is 12 percent lower than text ads — a function of the fact that many PLAs are directed at price-sensitive shoppers. ROI and CPC for both PLAs and text ads were roughly equivalent.

PLAs – love them or hate them – are here to stay, so here are five tips that we’ve found have been helpful for our clients as they design and deploy campaigns based on the PLA format.

1. Coordinate PLA with CSE Efforts

Although PLA creative and text is managed through Adwords, bidding is executed at the product level, thus being managed like a CSE listing. Your teams will need to manage each program separately while integrating the results from each. For example, if you learn that a particular set of PLAs are well, you can use this intelligence to build out keywords related to this product group.

2. Maintain Separate PLA and PPC Budgets.

PLA campaigns — like PPC campaigns — can blow through a lot of money in a short period of time, so mistakes can be expensive. Until you are completely comfortable, you may find it useful to set aside a specific PLA budget apart from PPC with a budget cap to avoid unpleasant surprises.

3. Phase PLA In

Like PPC campaigns, PLA campaigns need to “learn” where their optimal profitability settings are. One approach we’ve found valuable in the campaign learning process is to launch a PLA campaign with a client’s full catalog using an initial starting bid for all products. Categories or products that fail to meet expectations can then be systematically purged until the campaign reaches a base level of efficiency, after which further, more incremental tweaks can be made.

4. Get Creative

PLAs are visually eye-catching, although many marketers currently use stock images and boilerplate copy to populate them. You can strongly differentiate your offers by using better, wittier ad copy, custom images, in your PLA creative – this can make a big difference when price is not a strong differentiator.

5. Monitor, Test, and Refine

You will need to continually monitor PLA results, make appropriate adjustments in response to test results and seasonal changes, and take other hands-on action.

Make sure your team is prepared for this level of engagement. The good news is that the insights that your team learns about PLA performance can be ploughed back into your PPC and other online marketing efforts, making them all more efficient.

About the Author – Mark Simon

Mark Simon is senior vice president of sales and marketing at Didit, a digital advertising agency specializing in paid search, online display advertising, CSE feed management, SEO and Social Media. Mark has also served within industry organizations, holding the position of co-chair of the IAB Search Evangelism Committee, as well as being on the Shop.org member services committee and the DMA Research Forum Panel.


Guest Blog By Bram Hechtkopf 

For the past year, Kobie Marketing has been emphasizing the importance of adopting of an omnichannel loyalty strategy as a means to enhance customer engagement and drive ROI. Regardless of vertical – retail, entertainment, hospitality, travel, etc. – brands benefit when their loyalty program is embedded throughout the customer lifecycle and on channels of customers’ choice.

Most importantly, omnichannel loyalty promotes heightened customer experiences. That’s especially the case when the tenets of omnichannel loyalty are incorporated into a converged CRM-Loyalty management framework. Doing so is not just about revenue generation, but creating a genuine customer connection. The result is a happier, more engaged, eager-to-spend consumer. And such a consumer might also help reverse a trend that a new eMarketer report calls “shopping cart abandonment.”

Think of shopping cart abandonment like the online world’s brick-and-mortar showrooming equivalent. Shopping cart abandonment happens when an online consumer places items for purchase in their virtual cart, but doesn’t place the order. According to the report, 57% of respondents ditched their carts because they were not ready to purchase and wanted total cost plus shipping. The report also found:

·         56% wanted to save their cart for future purchase

·         55% said shipping costs were more than expected (thus the lost sale)

·         51% learned that their purchase costs were too low to qualify for free shipping

But the report successfully turns these numbers on their heads: shopping cart abandonment may not be as troubling as first thought. As with showrooming, the customer may not buy on one channel but may very well buy on another. And this is where omnichannel loyalty comes into play in two critical ways.

Virtual shopping carts should include a loyalty component – Something as simple as offering free shipping to loyalty members would seem to allay many customer concerns. For those who believe strongly in the shopping cart abandonment problem this could be critical. It’s also an ideal transaction point where more experience-driven offers can be promoted, lowering a consumers’ shipping cost concern.

Loyalty programs are rich in metrics – And the more customer knowledge retailers have  e.g., what they’ve purchased, how often, where and for what price means that, rather than guessing over lost online shopping carts, brands will have the data to know if a given customer stocked up their shopping cart and then purchased those items elsewhere. In other words, information follows the consumer. For example, if a customer abandons an online shopping cart, the brick-and-mortar store can invite or incentivize (via a loyalty program) that customer’s return to the physical location.

Omnichannel loyalty continues to prove its worth – not as a marketing catchphrase, but as a tangible way to improve the customer experience, manage data and mitigate concerns addressed in studies such as eMarketer’s.

So is cart abandonment a serious problem or an overblown concern? Tell us what you think and continue the conversation.

Bram Hechtkopf is VP of Business Development & Marketing for Kobie Marketing.

Stop Torturing Your Customers! How to Deliver “More Gain, Less Pain” for Brick and Mortar Shoppers

Guest Blog by Ralph Crabtree

According to a 2012 New York Times column on the psychology of queuing, (Why Waiting is Torture,) Americans spend roughly 38 billion hours each year waiting in line. And those billions of hours aren’t exactly flying by. . . People overestimate how long they’ve waited in a line by an average of 36 percent. Author Alex Stone states, “The dominant cost of waiting is an emotional one: stress, boredom, that nagging sensation that one’s life is slipping away.” Not the experience that retail stores, supermarkets and other brick and mortar businesses want to be giving their customers, especially when the competition is just a mouse click away.

While it’s likely impossible (or at least cost prohibitive) to eliminate waiting completely, retailers can take steps to make the entire in store experience, including queuing, more enjoyable for shoppers. Here are several ways to ensure that a visit to your establishment is viewed with pleasure rather than pain:

Become a queue master. As the old adage goes, “you can’t manage what you can’t measure.” In order to staff appropriately and minimize wait times, retailers need to know things like: “How many people are in my store?”; “How long are shoppers waiting in line?”; and “Are people exiting before completing a transaction?” A clear understanding of what’s happening minute-by-minute is critical—and this requires advanced technology capable of capturing real-time insight about shoppers’ behavior as they move about a store. Think of it as clickstream analytics for brick-and-mortar. Retailers can use this kind of behavior-based intelligence to deploy staff when and where they are needed, manage customer expectations and even design check out logistics, with the goal of delivering better, faster and more “high-touch” service.

Communicate. When it comes to waiting, a little knowledge goes a long way. Research shows that people get more frustrated when they don’t know how long their wait is going to be, or when their wait will end. Supported by accurate analytics that help estimate queue times based on in-store traffic and historical data, retailers can push updates to customers, either in-store, online or through a mobile app. This not only helps consumers choose when and where to shop, but also sets expectations. It may turn out, for example, that a queue that looks really long is actually moving quite fast—if customers know this, they are less likely to abandon their cart and your store.

Play up Your Store’s Real World Strengths. It’s true that online shoppers don’t have to wait in line. But brick and mortar environments also offer advantages that the Web can’t deliver. More personal, one-to-one service, for example. A place where consumers can try on or try out merchandise before they buy. An enjoyable experience that goes beyond mouse clicks and a laptop. The key word here is “enjoyable.” Staff your store with friendly, knowledgeable sales people who can answer questions about your products. Make sure employees are available to quickly help a shopper find a size, to recommend a book by a particular author, or locate an ingredient that’s needed for a new recipe. Design an environment that’s fun, interesting and offers something that online commerce can’t. (Lattes anyone?)      

Today’s consumers hate to wait. But they also like to shop. With a little insight, creativity and good old fashioned commitment to service, retailers really don’t have to torture their customers to make sales.

Ralph Crabtree is CTO of Brickstream