The Path from Black Friday to Cyber Monday

How did the weekend stack up?

A collection of factoids, stats, benchmarks and insights on the recent shopping weekend - estimated at around $59 billion or 10% of the holiday retail season. 

First, it is probably incorrect to classify it as discrete day or two - it is becoming a season which ebbs and flows as people transition from one mode to another.  That said, it does make for good theatre to debate and illustrate the differences.   Here are some comparisons between Black Friday and Cyber Monday.

• Sales and traffic were up with a record 227 million people shopping and spending more.  Here's what we learned:
• The large gain may simply have been a case of time shifting.  Time will tell whether we robbed Peter to pay Paul.
• Consumer confidence suggests that the 'fiscal cliff' may be a speed bump; if Washington can get their act together.
• Holidays aren't sacred and online isn't a stigma.  Turkey-day sales were up 32% as people shopped in the evening before (or while) moving online.  Black Friday topped $1 billion in online sales for the first time.
• Mobile accounted for a larger share of online sales on Black Friday than it did on Cyber Monday, (16.3% vs. 12.9%).  Guess showrooming is real when out and about and the desktop is better when sedentary at work.  (Other good information there.)
• The tablet, and by that I mean iPad, established itself as a unique shopping venue - at least at Mall of America.  Sales of iPad - 11 per hour; sales of Surface 0 - per hour.  
• Direct sales from social networks were below nascent, registering just 0.2% of sales.
• In the middle was Small Business Saturday - which has been pegged at $5.5 billion or 10% of the weekend's retail sales.   Transactions up.
• In an interesting look, the social graphics of followers of six retailers suggests a difference between how people think of where to go for deals and gifts.

The implications of the end of BF/CM were summed up by Chris Copeland of Group M Next.  Paraphrasing...

1. This is a communal activity at its finest; social technology isn't at play when we're in the mood to buy.
2. The product isn't what's in the box or on a hanger.  Ancillary features, advantages and benefits will distinguish retailers from sellers.
3. Yield management, i.e. changing pricing patterns, will emerge as consumers have access not only to real time but historic data. 

The Making of Small Business Saturday

How did the day between Black Friday and Cyber Monday come about?

Drew Neisser, CEO of Renegade published a two-part interview with Scott Krugman, Director of Communications at American Express about the origins of "Small Business Saturday".

• Part One: talks about the creation of the event in 2010 in a matter of weeks.
• Part Two: covers the evolution of the program in its second year.

The summary points:

• Big Ideas can happen fast. It shouldn't take two budget planning cycles to get approval from stakeholders and implement.  In fact, if you're getting resistance then either the idea probably isn't quite right or the timing is off.
• It's about their brand.  This is a case of using your strengths to help your customers achieve their goals; in this case the growth of small businesses.  If you see and talk about the problem thru your organization's glasses, change them - or at least clean them.
• Pay to get talked about.  While s**t might happen, social and viral exposure need to be activated and that means paid media.   Advertising stimulated the conversation - and in this case partners like Facebook added inventory to the mix for small businesses.
• Doing good can't be about control.  "Shop Small" is a rallying cry that resonates well with a lot of potential partners, audiences, and even competitors.   Even so, there is the potential for commercial success - a fair amount in AmEx's case if you like to see transactions up 23%.

Given even the political support it has, the idea can best be described as a movement creating a life of its own.   And in honor of turkey-day, paraphrasing Arlo Guthrie's "Alice's Restaurant" seems appropriate since I'm sure she participated.

They may think it's an organization.  And can you, can you imagine fifty (million) people a day, I said fifty (million) people a day walking in singin' a bar of Alice's Restaurant and walking out.  And friends they may thinks it's a movement.

Actually, the number last year was over 100 million.



I've enrolled my cards for this year....looking forward to meeting small business owners passionate about their craft.

Black Friday Notes

With less than 48 hours to go what is it with Black Friday anyway?

Recent research explains why we like Black Friday; it is biological.

• Coupons relax us, make us happy.  They release a hormone associated with trust and love.
• Line waiting: Ritual, not pain. It "constitute[s] a collective consumption ritual"
• The possibility of fighting over goods is exciting.   "perceived competition ... creates positive emotions and induces hedonic shopping value."

OK, I won't be there with my close friends jostling with the crowd singing kumbaya.  So, here are some things retailers are doing to make it interesting:

• Oops, it started 48 hours ago. Black Friday isn't a day anymore with deals spreading out before and after the 4th Friday of the month.  "Magical Friday", Disney's attempt at hijacking a brand, actually started two days ago on a Monday.
• Black Friday isn't just for retailers anymore.  Brands are leveraging borrowed interest to get into the act.  For instance, Di-gel - a stomach remedy - is establishing a comfort zone in NY with phone charges, seats and restrooms. 
• Walmart is introducing a food subscription service to get consumer reaction to potential products.   Samples are sent to people who sign up at Goodies.co - currently by invitation.
• Target is facilitating showrooming, the practice of checking online prices in store that impacts 80% of retailers, by installing wi-fi and encouraging people to consult their phones/tablets. Their Black Friday web site offers deals via text message campaign. 
• Macy's is putting store-only items on the mobile device by passing online in an attempt to "figure out the best way of offering merchandise to customers and satisfying demand."  They hope to have it figured out by 2014.
• The strong get stronger, if you search for "Black Friday" you are quite likely to include "Walmart" or "Target" in the query.  

Ready, set, shop....

Street Address vs. Facebook Profile

Which would you rather have a consumer provide?

In the review of a web site, we asked the typical question:  Which elements lead to a purchase?

The category is lifestyle - pure and simple; consumers are social and share their stories; the site is filled with content and user experiences.  The profile form is simple - asking only the minimum required information (email and phone), the rest of the contact information is optional. 

The available data covered all types of behavioral activity, search processes, web page paths, content interactions and social referrals.   All good stuff and all best practices.

Question:   What is the most important activity related to future purchases?
Answer:   Providing a street address in an optional field.

Of the 100+ variables evaluated - the fact that a consumer had provided his/her home address was the a significant predictor of a purchase by a wide margin.   Not what they had looked at, watched, configured, downloaded, or shared.  Not whether they came from social networks, organic deep links, or paid search.
 
While we have often several email addresses and multiple phone numbers - we usually have one street address.   This analysis suggests that if I'm willing to provide the one form of contact that I can't ignore - I'm engaged and on the path to purchase.  

So, just because we're thinking digital don't overlook the terrestrial. 

Connecting a Consumer Centric Platform

What does it take to satisfy consumers?

Thanks to the smartphone and digital interactions, shopping today is often completely different than the systems we deployed in the past.  Retail Systems Research recently concluded a three-part series on an overarching cross-channel architecture based on a presentation at the RIS News Cross-Channel Executive Summit entitled “Becoming Omni-Channel Ready for 2017″.

All the components needed to create a consistent consumer experience across shopping channels is like the old children's song: Dem Bones.

The leg bone is connected to the knee bone;
The knee bone is connected to the thigh bone;
The thigh bone is connected to the hip bone;
Now shake dem skeleton bones!

The individual components read like a government procurement contract with all those three-letter acronyms (TLA).

• CRM - customer relationship management is responsible for a 360-degree view of the consumer (also referred to as Master Data Management (MDM))
• PIM - product information management covers not only the physical information about the product, the various merchandising hierarchies but also the communal content found in reviews and ratings
• DAM - digital asset management deals the classification, control, storage and distribution of content to all matter of channels and devices, often simultaneously  
• OMS - order management system responsible for ensuring inventory supports demand; no sense promoting something you can't deliver
• POS - point of sale captures the transaction and includes both in-store and ecommerce platforms, at least for this discussion

The glue that connects them together has the unfortunate techy name of "Service Oriented Architecture" (SOA).  These techniques are most common in supply chain functions where retailer systems talk to manufacturer systems.  In the case of consumer experience, cross-channel marketing along the shopping journey requires this type of thinking as well.  Whether it is one platform or a collection, this is where it all comes together.

Some key points:

1. This isn't something you can buy today from any one vendor.
2. This won't happen overnight; it is a 3-5 year plan. 
3. Marketing is now a line, operational function with P&L responsibility.
4. It will take a market-leading vision to get there.
5. Insight-driven changes in marketing plans is the only way to justify this.

Campaign Analysis

Which party was the better marketer?

It has been a week since the election and the results been sliced and diced a myriad of ways looking for insights as to why the results turned out the way they did.   Here's a view of how various pundits fared in terms of predicting electoral votes.

Each dart represents the estimate of a prognosticator; blue are democrat or 'left' thinkers while red are 'right' or republican.  The three in the center nailed the outcome precisely, those outside the dart board missed by over 100 electoral votes.  Since there are only 538 votes to divide into two piles, one would think that the predictions would be a bit closer.   I guess there was a lot was analysis without analytics (those aren't the same thing). 

In addition to the results themselves, stories are emerging on how each campaign used data which are quite illuminating.

Obama had a data crunching team focus on integrating everything possible and then testing idea after idea to optimize their marketing efforts to not only raise $1 billion but also mobilize GOTV (get out the vote) initiatives.  As with many marketing data projects it took 18 months to get the disparate sources under control and organized appropriately.  In the end, there were 40 million people that were segmented and targeted appropriately.   At the one end were the contest-loving, dinner party crowd who bid on "Dinner with Barrack" hosted at Sarah Jessica Parker's home.  At the other was the use of ranked contact lists texted to your phone based on the probability of persuading voters.

Romney had data too.  But from the sounds of the stories it was a case of GIGO - garbage in; garbage out.   The working assumption that republicans were more motivated than democrats proved to be wrong so the polls weren't balanced.  The email database is reported at 4 million and contact rate 1/20th of the democrats.  There was little evidence that the campaign leveraged outside lists for acquisition, a common marketing tactic.  When it came to GOTV supporters were sent a 60 page pdf to print out and turn in; no digital solution there.   For the trials and tribulations of one volunteer read this story.

It seems the secret to winning 8 of 9 swing states was marketing best practices:

Target
Test
Tell No one

10 New Rules of Sales and Marketing

What has changed in the turn of the century?

A recent presentation by Mike Lipkin highlighted his ten new rules of sales and marketing.  This was given in the context of a sales meeting so the commentary was biased toward that audience.   That said, the 10 trends are:

1. The Future is Flat:  refers to the fact that expected economic growth (GDP) and the related advertising spend is anemic at best.  We can't ride anyone's coattails anymore.
2. Older is the New Young: the aging population doesn't mean we feel any older; 60 is the new 40 (if not 30) so design for age but package for the 'mature youth'.
3. The Mosaic is the Message: touch points are everywhere and not very well organized, get used to it.
4. The Data are Overwhelming: like an extra large supreme pizza, micro focus on one slice at a time
5. The Customer is Smart, Well-Informed & In-Control: re-frame the conversation based on insights.
6. It's Becoming a Woman's World: think feminine,while staying safe for me.  The Dyson vacuum cleaner cleans OK but reminds men of the robots of their youth.
7. Media are Personal: 'nuff said.
8. The Time is Now:  people pay us to make choices and we're human, so we're likely wrong sometimes.  As Seth Godin would say: Ship the product.
9. It's a Matrix Out There: There are very few degrees of separation between anyone.  Social networks make it possible to reach out and touch anyone.
10. Motivated People Win: 'bring your own growth' ties it back to #1

Strategy Development for Different Markets

What's your strategy for your strategy?

A recent article in Boston Consulting Group's "perspective" categorized strategy according to two dimensions.

• Predictability - how well you can glean foresight from the crystal ball.  Household Products and Beverages predictable.  Transportation Infrastructure and Marine are unpredictable environments.
• Malleability - how well you (and your competitors) can change the rules of the game.  Tobacco and Office Electronics are well structured, defined spaces.  In comparison, Health Care, Food Products, and Diversified Consumer Products can be invented as we go.

The intersection of these two dimensions creates four categories...as all good consultants do.

1. Classical:  Predictable; but can't change it -- so it is about managing resources
2. Adaptive:  Unpredictable; and still can't change it -- so agility is key
3. Shaping: Unpredictable, but can change it -- so influence it and occupy a sweet spot
4. Visionary: Predictable; and you can change it --so be bold and create a market

It is interesting to note where some of the industries I work with sit in this matrix.

• Internet & Catalog Retailing:  completely unpredictable, but reasonably malleable (shape)
• Media: a little more predictable and malleable (visionary)
• Food & Staples Retailing: quite predictable and a little less malleable (visionary)
• Internet Software & Services: unpredictable and malleable (shape)

So, marketing in these spaces means a) we can (should) change the future and b)we need to balance the risks associated with unpredictable AND predictable industries.   

The intersection could be quite interesting to invent.

Evolution of Brand, Digital Marketing

Where do brand and digital marketers meet?

Not only is the sales funnel not really a funnel anymore, but the process by which we do things has flipped around.  In the days of costly distribution channels, analog content, and limited consumer choices we needed to Plan > Execute > Track.   Today, digital interaction means we have to change things up.  The idea behind agile marketing is: Execute > Track > Adapt.

A three-part series by Simon Ward of Ayzenberg outlines the agile marketing side of the equation focusing on the intersection of brand (long term) and digital (short term) marketing. 

A collaborative relationship between brand managers and digital marketers begins with addressing key questions:

• Where should brand management and digital marketing meet?
• Can marketing activity creation, approval, and implementation get more efficient and effective?
• How can digital marketers see brand management systems as a help and not a hindrance?
• How can brand managers strike the right balance between brand guidance and control and the marketer's freedom to iterate, innovate, and implement more effectively?
• How can brand managers "get" digital?

As an example of the new world order:

"Heineken CMO Lesya Lysyj recently referred to their real-time marketing. She said, "We use Facebook as a research platform…we just put stuff out there and learn from the response.""

That learning has to come from leveraging the underlying data.  And to borrow a line from another article "Effective measurement and analysis are the keys to making money in {your} industry." 

Capturing, analyzing, and acting on relevant data to optimize the customer experience and increase online revenue is easier said than done. Here are some important questions to ask:

• How can you capture real-time data based on user engagement and use them to build personalized experiences that take into account user context?
• How do you determine which data points provide the most accurate picture of the way users are consuming your media content across all channels and touch points?
• How do you integrate data from multiple .. systems in a way that allows you to draw connections between disparate customer experiences?
• When is the collection and use of personal data useful for consumers, and when is it an invasion of privacy?

It seems that those digital questions are very brand oriented. 

In the future there will just be marketers.

Marketing Behavioral Targeting Like Botox

What can on line marketers learn from injections?

Brands based on innovation often result in a good guy, bad guy debate as a result of trying to resolve the contradictions inherent in nature vs. technology.  "Cell phones keep me in contact" vs. "Cell phones cause cancer."

To develop this thinking further, Botox was this subject of a recent article in the Journal of Marketing focused on the evolution of the brand in light of doppelganger, or contrarian, imagery. The lessons learned could apply to not only brands buy whole categories as well, like "behavioral targeting". 

According to the study, four different contradictions emerged thru the first decade of the brand's life.  On the one side was the brand promise; on the other was the opposing view raised by critics. 

1. Pleasurable Play vs. Poison
2. Miracle of Medicine vs. Frozen Face
3. Expression Enabler vs. Frankenstein
4. Performance  Booster vs. Junkie

The last brand image reported, "Weapon of Liberation", had yet to have a strong counter point. At each stage, the brand evolved its position to combat the negative position.

The author recommends four steps to address such conflicts that can be applied from either side of the fence:

1. Write a story line that puts the normally ambiguous nature-technology relationship into sharp focus. We need to make the brand indispensable in our lives, not an abstract thing.
2. Establish authority to validate the position with 'socially sanctified' sources that are difficult to challenge be they facts and figures or authority figures.
3. Demonstrate the brand value thru a network of sponsors with concrete consumer experiences such as testimonials and credentials.
4. Spread the word, i.e. advertise, publish, encourage conversations and sharing.

With behavioral targeting, and the broader issue of consumer tracking, it is easy to see the same kind of nature-technology contradiction:   Help me find something vs. Spying.

From a brand perspective, the Botox lessons are clear for the marketing of behavioral targeting.

1. Take a strong stand: it is good for your well-being, makes life easier, or saves time.
2. Get someone we already trust to back up the position (saying 'self-regulation' won't cut it, nor will saying it creates jobs.)
3. Focus on successful consumer use cases (a better ROI for the advertiser isn't the answer).
4. Find a way to make it sharable and engaging:  "How it helped me...."

 And get ready to inject new life into the evolving saga as the critics take the same advice.