Marketing Darwinism - by Paul Dunay
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Marketing Darwinism - by Paul Dunay
Cyber, eCommerce, Security, Thought Leadership

Framing Security as a Business Issue – A Lesson for 2022

A guest article by Romi Mahajan

In an early part of my career- almost 20 years ago- I had the opportunity to work with some incredible people in the “security” space. Many of those I had the privilege of working with and learning from have gone on to do noteworthy things in the space- from being CISOs of large companies, to starting successful security startups, to authoring important and even tectonic articles on the space.

As I recall from those heady days two decades ago, those involved in the “Business” and “Marketing” sides of security (as opposed to the technical side) all agreed on one thing: Security has to be framed as a business issue not just a technical one. Ninety percent of those on the technical side agreed with this.

While the sentiment appears to be a cliché, it is perhaps more nuanced than it might seem. The point is not that security impinges on business and as such must be taken seriously. Instead, the emphasis here is on the nature of the business and the corresponding defense-posture that a business should take. Additionally, it’s a reminder that the nature of the business will dictate the differential investments in security that make up the whole.

Twenty years ago, I had an easy example to trot out for explanation: If your company is an ecommerce play then making sure your website is not hacked and is up and functional is key to your business. Not so much if your company is a restaurant. Both require security but in different ways and at different levels of investment.

At that time, we created a “Risk Assessment” that essentially assessed business risk and mapped it onto security posture and spending. The idea was that they should match in valence level- you don’t want an important asset unprotected nor do you want to spend millions to protect something that is irrelevant.

The notion that Business risk is the key element of analysis has persisted and would be a truism if indeed it was a universally understood idea. But alas it is not.

We still encounter generic language and un-nuanced views of security. We still see complacency in the ranks of business leaders, relegating security to something that “IT will think about.” We also still see a shifting landscape of blame- forgetting conveniently that security has to be a Board level issue.

LAMR Group’s Paras Shah says it well- “After the fact finger pointing does no one any good in security. Resilient frameworks for managing the business issue that is security have to be developed and funded, continuously, by the Board of any organization of appreciable size.” Security thinker Manish Godha adds, “Security better be part of your 2022 plan. Not-negotiable.”

In a world of daily breaches, attacks, ransom demands- on and to the systems on which our entire human infrastructure runs- security must not only be top of mind but the “thinking” has to be met with real action. The suggestion that security is just a technology issue has no place in the dialogue of 2022 and beyond.

December 30, 2021by Paul Dunay
Advertising, Applications, Commerce, Conversational Marketing, eCommerce, Interactive Marketing, Mobile, Social Customer Service

Chatbots: The future of conversational commerce and marketing

It’s no secret that the rise of computer apps is transforming both the marketing and customer experience. One of the most intriguing developments in app development is in the area of chatbots that not only can send communications to customers but also respond “intelligently” to conversations.

Recently, I had the pleasure of speaking with Christian Brucculeri, the CEO at mobile messaging company Snaps, a developer of chatbots and other marketing technology products for companies. Brucculeri explained some of the background of how chatbots came to be, as well as their usefulness as a marketing tool.

“Typically chatbots represent a conversational interface between a consumer and a machine,” Brucculeri said. “They’re applications that have linguistic structure. It might allow you to ask a question and try to find an answer. They enable one-to-one communication between brands and consumers at scale, and they leverage technology in order to do that.”

Certainly chatbots have close technological relatives we’re already used to, like Apple’s Siri, Google Home and Amazon Alexa. You might call automated phone systems—the kind people love to hate—as a chatbot’s second cousin. But so far these are far from able to use artificial intelligence to understand language, and respond appropriately.

And while the technology can be used for entertainment purposes—think Snapchat or Facebook Messenger, for example—its greatest impact is potentially coming in marketing, Brucculeri told me.

Creating conversations, not messaging

“We work with brands across several industry verticals, including tourism, hospitality, entertainment, media, CPG, retail, quick-serve restaurants and more,” he said. “For example one apparel brand delivers a 30-day workout experience using basic Facebook Messenger. For some hospitality brands, they’re trying to manage their ongoing relationship with consumers and help them manage their rewards accounts.”

In many ways, this sounds similar to most apps we’re used to. So, what makes chatbots a different kind of app?

“Where chatbots get really interesting is in personalizing media and responses,” Brucculeri suggested. “Here, you can really do one-to-one marketing at scale.” Brucculeri said Snaps has developed such chatbots for sports teams, where a fan might receive notices of games, results and highlight videos. In the stadium, a chatbot might help a fan find restrooms and snack counters, based on physical location.

Brucculeri said Snaps is developing chatbots that function on a variety of existing platforms. Facebook Messenger, which launched a chatbot in 2016, may be most appropriate in accessing consumers, he said, but there’s also Kik, WeChat, Slack and many others, each of which may be experience-specific.

Chatbots also can be connected to customer relationship management platforms, such as Salesforce, to deliver notifications at the right time to the right person, Brucculeri said.

“We do CRM integration and user matching to log in and do account management,” he said. The result might enable companies to find new customers, engage with existing customers in a fun way, getting customers to take some form of action, or managing the relationship in other ways.

Improving the customer experience

Customer service, driven by artificial intelligence, also can be aided powerfully by such matching, Brucculeri said. Instead of hitting a bunch of digits to get routed to the right person, the artificial intelligence capabilities of chatbots—the two-way ability to listen and respond appropriately—can improve this experience immensely.

“A chatbot can do this in ways that are more convenient, simple, fast, and better for the customer and probably less expensive for the customer-service function,” he said.

The future of chatbots is an intriguing one, as technology evolves and as the bots themselves get “smarter” and more humanlike in their analyses and responses.

“We’re long on the idea that conversational interfaces will continue to evolve. Whether consumers are texting with or talking to them, automated systems like bots are almost certainly going to have a role in our future lives” Brucculeri said. “We see conversational media becoming the next wave and being potentially bigger than application media itself. I think in three years, people might be talking to bots more than they’re typing in bots.

“But the main idea remains the same,” he said. “Might I one day launch a chatbot on Alexa, Amazon’s voice control system? How about getting some type of visual element to go along with that, such as HoloLens, Microsoft’s holographic headset? Can these things become really rich experiences, far better than just staring at our phones and typing?

“I think some of the form factors are going to change, but I think the fundamental elements are going to be the same, which is conversational commerce. People increasingly will be talking to their computers, and they’re going to get a lot done by doing it.”

December 14, 2016by Paul Dunay
Behavioral Targeting, Customer Experience, eCommerce, Online Testing, Optimization

5 Ways CMOs Can Master Their Online Customer Experience

User-Online-Experience

As mobile devices continue their gains in popularity and usage worldwide, more consumers are interacting with brands at various stages of the buying life cycle—from browsing, researching and comparing products to reading reviews, sharing their experiences and making actual purchases. The digital affinity of consumers, who once were bound by a very tactile customer experience of seeing and touching products in-store, has put a lot of pressure on CMOs to become the boss of their online customer experience.

While being a CMO connotes leadership and authority, it doesn’t inherently mean brands need to be forceful or intimidating in how they speak with their online customers. What does work is a smarter and more nuanced approach to listening to their customers’ explicit actions and using those actions to become more relevant to each individual customer. Brands that get this approach see it pay off with greater respect, trust, loyalty and, of course, revenue.

So to help CMOs master their online customer experience, I have outlined five surefire rules they should follow to get customers to respect, trust and spend more dollars more often with them across multiple channels.

Rule #1: Don’t shout and bulldoze your customers into clicking and buying.

In the traditional model of sales, salespeople often acted and operated under the premise that being louder, pushier and more forceful was the way to win over, or bulldoze, consumers to get them to say “yes.” There was a notion that salespeople could wear down consumers into succumbing to their will and, as a result, get them to make a purchase.

While that approach may have resulted in a one-time sell, we would all agree that it isn’t the most effective way to generate repeat, long-term loyalty and purchases from customers. Today’s customers have almost limitless choices and options at their disposal. If they can’t find a product in-store, they can easily and quickly type, click, tap and purchase away on a number of competing online sites. If they’re strapped for time, they don’t have to wait (for hours) to get in front of their desktop/laptop computer at home. Instead, they can browse, compare and shop from thousands of product options on a brand’s mobile-optimized site directly from their iPhone, Samsung Galaxy, Apple iPad or Google Nexus tablet.

Even more than convenience, consumers aren’t as easily swayed by hyperbole, outlandish claims or dubious offers. Brute force and fear are no longer profitable strategies. It’s the brands that are authentic, humble and real that get consumers to keep their eyes (and hands) on their online and mobile sites longer and ultimately clicking through multiple areas of the site to the checkout or to request a quote.

Perhaps more important, it is almost impossible to guess at what ideas and appeals will resonate most with your buyers and entice them to buy. Lower costs? Free shipping? Sustainable materials? Thirty-day guarantees? Bigger images? Different CTA? Guess if you want. But the only way to truly know for sure what attracts your customers is to test and learn what they really want. More important, it is to use the big data from your tests to tailor what you’re saying, doing and offering across all devices. The most successful online marketers aren’t browbeating; they’re influencing by showing value. They are experimenting and exploring all the time.

Rule #2: Listen to your customers and make their lives simpler and more productive.

The reality is that customers will be more accepting and responsive to messages and offers that have real value. If there is no perceived value, they’ll click away without batting an eye. At the end of the day, consumers want the same thing from the online customer experience as they do from the products they’re buying. Simply put, it needs to solve a problem. If your customer experience isn’t solving a problem for your customers, you’ve got a big problem on your hands, and all the fancy design work you can imagine (and spend money on) won’t make any difference.

The key to rule #2 is not to guess at what problem drove the customers to your site. Instead, it is to serve up only what your customers truly want based on what you know about them as well as what they have previously asked or searched for. Recommend products that make sense for them, not for you as a brand. By listening to your customers’ needs and digital footprints, you can tell a lot about them and what types of messaging and offers are likely to resonate with them and make them more willing to spend money repeatedly across all devices with your brand.

Rule #3: Be in more than one place at a time.

Consumers don’t just look for and buy products in one place. They’re using multiple devices simultaneously throughout their day and juggling dozens of activities at once. In this “Age of the Customer,” the adage of “I can’t be in two places at one time” no longer rings true. For brands that want to get customers to experience and interact with them and their products/services consistently and repeatedly, it’s important to be in more than one place at a time and deliver a consistently great experience in all of these channels.

Rule #4: Never pistol-whip new visitors.

For your website’s home page, the easy way out is to display three, four or even five offers, rotating in sequence. On the surface, it makes sense: The more “stuff” you show, the better your chances are of finding something that a given customer may like. Better yet, it also satisfies all those internal groups that are clamoring for exposure on the website.

However, this approach is problematic because the data shows that few visitors (other than your internal teams) ever get to the end of your rotating banners on your home page. This is because there is an average of a 50 percent drop-off after each banner. Experience also shows consumers do not have the time or the patience to wait for the right offer to appear. It’s much more effective to test home page offers (to quiet those internal groups) and use that data to personalize the offer based on who is visiting your website.


Rule #5: Cement boots do not create loyalty.

In all cases, you will make more money across multiple channels from customers who return again and again. The long-term revenue opportunity lies in building trust and loyalty with visitors who keep coming back and recommend your site to their network of friends and family.

What is the best way to get customers to sign up for newsletters or emails? What should you say in your follow-up communication to customers? Should you offer exclusive products or discounts? How should you greet repeat visitors and what should you offer them? Have you tested and experimented with this content? These are all great questions brands should be asking themselves when optimizing their online presence.

There’s a reason why Amazon garners such incredible repeat business. The online giant understands which groups of consumers they are actively selling their products to and integrates those consumers’ digital history, preferences, behaviors and actions into their customer experience across all devices. If brands want to learn anything from Amazon, it should be that engagement across multiple channels is less about muscle and more about smarter marketing.

November 15, 2013by Paul Dunay
Branding, Communities, eCommerce, Interactive Marketing, Mobile, Optimization

3 Secrets To Having A Two-Way Conversation With Your Brand’s Customers Online

2 way conversation

No matter where you look, brands are all trying to crack the code of having a two-way conversation with their customers wherever they are – be it in-store, online, on a smartphone, on a tablet or on social media. It’s a constant struggle for brands to make themselves be seen and heard above all the noise that’s out there, especially when their “prime” consumers have minimal attention spans and are far less forgiving of faulty, uninspired experiences with brands.

However, brand loyalty online can be much more fleeting than it is offline. Stop and think about some of the online brands that have your devoted loyalty (no matter what sins they may occasionally commit). What Google, Amazon and Facebook all have in common is that they’ve built their entire customer experience across all devices and all channels around customers’ trust and respect. For many of us (myself included), it would take a lot to sway my trust, respect and loyalty away from these three online giants.

When brands commit customer experience sins such as excessively slow page loads, page flickers, and irrelevant messages and offers, the cost can be more than just how consumers feel about and speak of your brand. It can actually decrease their likeliness to click through a brand’s website or mobile site, and lead to a willingness to go to a competitor’s site. That is what we saw in the “Mobilizing the Retail Shopping Experience” research study. One of the most important findings of the study revealed that 39 percent of consumers would leave and visit a competitor’s mobile site if their customer experience expectations were not met. Meanwhile, another 23 percent would return less often if the mobile experience were deemed poor. If that’s just the scenario on mobile retail sites, just think about all of the e-commerce sites and brands that rely on the Internet to drive traffic, click throughs, newsletter sign-ups and purchases. Here are three secrets to help brands have a two-way conversation with their customers online.

Don’t treat every customer the same.

Smart marketers realize that painting their entire web and mobile audience with the same brush is no longer a valid strategy. With so much data available about a visitor’s digital behavior and preferences, it’s unfortunate that there are still brands out there with one-size-fits-all customer experiences. Say a visitor is sitting in front of their laptop on a Sunday night and while searching Google for Prada heels, this visitor is served up an ad with multiple fashion sites with a variety of shoe options that will make this visitor swoon. When this same visitor returns to one of the fashion sites, wouldn’t it be more effective to personalize and differentiate the messages and offers she sees? That’s the power of personalization: It not only gets a first-time visitor to click on a home page and navigate through product pages to the final “buy now” purchase moment, but it also gets returning visitors to come back repeatedly for multiple purchases.

Show and tell customers why you’re better and right for them.

While consumers may have been to your site before, they are not experts in every single product that your brand makes and what differentiates those products/prices from competitors. How is it that Amazon can offer millions of products, yet it makes customers feel like it knows the certain products that they may want either by showing products to others like myself who have already purchased, or similar products typically sold alongside the items I just added to my shopping cart? It’s all about being smart and attentive to the customers’ needs and preferences.

Stop talking and listen to your customers.

In this “Age of the Digital Customer,” everything consumers like and don’t like is being tracked socially on places such as Facebook, Twitter, Instagram and Pinterest. But for brands, the real opportunity lies in the data obtained from consumer interactions on these social media sites. By incorporating Facebook data into the entire digital experience, brands can develop richer, more relevant customer profiles and, in turn, be more personal and targeted in the messaging and offers shown to these consumers. That means the experience becomes more than just a social experience. It becomes authentic, meaningful and sustainable.

November 1, 2013by Paul Dunay
Behavioral Targeting, Big Data, Customer Experience, eCommerce, Personalization

Using Big Data To Target The Right Consumers With The Right Offers

ss-big-data-brain

Should every visitor to your website be treated the same? Should each customer see the exact same offers, options, products and pages?

The more forward-thinking online marketers recognize that “personalizing” each customer’s experience on their site can make a dramatic difference in ultimate sales, customer loyalty and long-term profitability of the business.

Fact is, in many markets, customers have actually come to expect individually tailored offers and experiences—based on who they are, what they’ve bought before or even how they have come to the site.

But exactly what should you personalize on the site? Which offers, products or promotions should you present to which customer? And how can you tell what each type of customer will respond to best?

When you know what you want to accomplish, you will be able to identify the right combination of technology, tools and strategy for personalizing each customer’s experience. Here is where to start:

Harness the Power of Big Data, Big Testing

The notion of big data holds great promise for finding ways to personalizing the Web experience for individual customers. The vast amounts of data on customer behavior and history that can be captured via the Web and be invaluable in making decisions about how the website should work, what customers respond to, and understanding the discrete segments in your customer base.

Marketers who can harness the power of big data will be able to make decisions based on evidence, rather than guesswork—giving them a distinct advantage over the competition.

Of course, making sense of huge volumes of data, which may be in different forms and come from different sources, is not so easy. What’s more, it’s also difficult to translate that information into “personalizations” that are meaningful and compelling to your customers.

That is where today’s more advanced tools come in.

The aggregation and use of big data are crucial to segmenting and targeting your individual customers with the appropriate experiences. It requires employing predictive behavioral targeting and optimization techniques to remove the complexity. Your systems need to make real-time digital decisions for the masses—anytime, anywhere.

Love Your Loyalty Programs

For most marketers, loyalty programs provide a wealth of personalized data on your most desirable customers. But once you’ve enrolled customers, what should you do with the data?

This data isn’t just for tracking points and past reservations. It can be used to digitally personalize the experience for each customer in real time. Initiatives like offers, promotions, calls to action, special prices—whether on your website, mobile site or app—can all be preselected or promoted based on each visitor’s unique profile. This tactic ensures visitors see content relevant only to their loyalty level and behavior. A better experience leads to higher loyalty.

With each loyalty program visitor who comes to your website comes their unique “virtual profile” that can—and should—be used to tailor their experience on your site, in real time. Insight on behaviors such as previous products researched, frequency of purchases, the nature of past purchases, and ads or offers they’ve clicked can inform what content and offers you should make available to each individual, and precisely when in the process.

Don’t Upsell or Cross-Sell Too Soon 

One mistake marketers often make is automatically tagging on extras, such as upsells, options or accessory products, as their customers enter the booking funnel. The customer who already had a price in mind suddenly sees that number increase just as it’s time to purchase. By forcing these add-ons at the wrong time, you’re more likely to elevate annoyance levels than average sales.

With recommendations, upselling and cross-selling, timing is everything. Don’t be pushy up front; instead, leverage CRM and personalization data to get the right offer in the customer’s face at the right moment.

Ditch the Rules; Get Automated

While rules-based targeting may work, it won’t get you very far when you’re trying to personalize offers for millions of site visitors. It is virtually impossible to manually create rules that can handle the thousands of combinations of behaviors, products and promotions, for every single person.

The next best option (and next big idea) is automated personalization solutions. Advanced predictive models can dynamically serve content and offers based on a user’s current and past online behavior. This way, your visitors will always have the most relevant and appropriate experience on home pages, landing pages, search engine results pages, the booking funnel and every page in between. In the case of repeat visitors to your site, for example, you might retarget them with an offer based on their last purchase, or their last search, all in real time.

Making sure these tools are on hand can ultimately help the business build consumer-centric promotional strategies.

Sync Your Channels

Your customers don’t think in channels; they think in brands. So they expect the same personalized experience they get on your site to be on their smartphones, in their email and even on Facebook. Customer experience is the number one ticket to prolonged brand loyalty and engagement.

How does your brand look across channels? Is it 100 percent consistent, optimized and personalized? If not, you could be missing a golden opportunity to improve hotel, call center, direct mail, social and mobile experiences. No matter where they visit you, your brand experience should be ready. Thanks to automated technologies, you can more accurately predict a customer’s next interest and follow up with optimized, targeted messaging, no matter how, or through which channel, they access your brand.

Combining this data with CRM data in real time to drive sales and customer retention is the future. CRM practices were born and bred in the offline world, but today marrying offline, online and mobile consumer data through new technologies can help you achieve better CRM and multichannel marketing outcomes: more precise targeting, personalization and consumer connections across all media channels, and delivered at the time most appropriate to increasing conversion—a very important factor in online marketing.

Imagine being able to target your consumers across the various phases of purchase with different messages at research, selection, shipping and the like. Not only can you dramatically enhance and personalize their experience with your brand, but increased retention, loyalty and customer lifetime values also result from a truly connected multichannel experience.

Remember, personalization isn’t just marketing hype. It’s a complex concept that really can live up to its billing. But first, marketers must identify what personalization really means in their business—and what it means to their objectives, target customers and buying cycles.

When it comes to their websites, mobile sites, apps, social media and CRM platforms, the online industry must realize that only through a customized combination of multivariate testing, optimization and personalization best practices can they truly begin to reach consumers with personalization that is effective and full of impact. There are no easy answers or instant solutions for creating personalization that works. It’s about evolution rather than revolution.

August 10, 2013by Paul Dunay
eCommerce, Optimization, Personalization

It’s Time For CMOs To Tap Into The Power Of Personalization

marble-personalization3

According to Forrester Research, U.S. e-commerce sales are expected to hit $370 billion by 2017 – that’s 10 percent of retail sales. These are some pretty staggering figures that brands and their CMOs cannot afford to ignore. More than anything, it’s a harsh reminder of just how much revenue they stand to lose if they get the online experience wrong.

Consumers today are finicky and want what they want, now. Some place the highest premium on loyalty and trust in a brand or product. Others, bound by the unstable economy, prefer deep discounts and bargains. And then there’s the ever-growing population of consumers who are always connected and always on, thanks to their smartphones and tablets. As different as consumers are, they all want to feel like the brands and products they use are tailored specifically for them. By providing personalized, relevant and unique content in line with consumers’ likes and dislikes, purchase behaviors and demographic profiles, they’ll increase eyeballs to their online or mobile sites, boost traffic and, most important, drive short-term and long-term sales. Here are five reasons why CMOs cannot ignore the power of personalization any longer, or they may soon be shutting their doors.

Make data your best friend.

It’s unfortunate, but a lot of brands these days are still guessing their way through their website design and e-commerce strategy. As smart and creative as most brands think they are, the numbers don’t lie. Data can be one of the most inexpensive and smart listening tools a brand can have in its arsenal. I can’t stress enough the importance of brands analyzing what works and what’s missing the mark with all of their design changes through A/B and multivariate testing. That kind of data is more apt to deliver real insights into who their audience is, what types of content and information they want, and where they are making those purchases. All of those learnings, in turn, can result in increased clicks, higher conversion rates, more revenue and happier customers.

Reach the right audience.

What is the demographic profile of your primary customers? Are a significant portion of your online customers also smartphone and tablet owners? Does product pricing influence the purchase decisions of your customers? The identity of your customers, their demographic profiles, what types of information they value as well as when and where they are making purchases are all insights that can help you reach the right audience at the right time with the right content – whether it’s in the form of emails, product recommendations or social promotions. So doesn’t it make sense to test and optimize your website to reach the right audience at the right time with the right content?

Be relevant, unique and indispensable.

One of the best ways to attract and retain customers is to make your brand and products so relevant, unique and indispensable that they would suffer if they went elsewhere. According to Forrester’s 2012 North American Brand Performance Study, being indispensable commands greater preference, and that means a higher likelihood that customers are going to keep spending their hard-earned dollars with your brand across multiple channels. One way to satisfy consumers’ high standards is to make product recommendations as personal and strategic as possible. Showing the right products in the best way on the right pages can result in higher site traffic, longer engagement times on landing pages and more sales. That’s a win-win for both brands and consumers.

Smartphones and tablets drive e-commerce growth.

If you think investing the time, resources and dollars into testing and optimizing your site for smartphones and tablets isn’t that urgent, think again. According to eMarketer, 15 percent of online retail sales this year will take place via mobile devices, which is up from 11 percent in 2012. Overall, U.S. retail m-commerce sales are predicted to reach nearly $39 billion in 2013, up 56.5 percent from 2012 and almost triple the amount spent in 2011.

But not every smartphone and tablet is the same; each device type, model and platform comes with its own unique set of features and functions. Failing to optimize and personalize your website for the smaller screen could very well mean the difference between being profitable and going bankrupt.

Forge meaningful social relationships.

Social media has forever changed the way we use the Internet and consume information. Once considered to be a new “fad,” social media is now an integral part of consumers’ daily lives. A study by Forrester Research found that 45 percent of people on social networks have interacted with a brand through social media over the previous three months. It’s especially interesting to see that 71 percent of online adults are accessing social networking sites at least monthly.

Despite how popular and “cool” it’s become for brands to have a social presence on sites like Facebook, Twitter, Instagram and Pinterest, many have done so without any real strategy or testing behind them. How often do you hear brands bragging about reaching 1 million fans or “likes” on their Facebook page? But these metrics aren’t tied in any way to ROI and sales. Incorporating social data into your overall personalization program can convert those actions into leads and revenue. Isn’t that what really matters to your business?

 

July 18, 2013by Paul Dunay
Commerce, eCommerce, Strategy

Amazon vs. Wal-Mart: How Online Strategy Can Meet In-Store Opportunity

Amazon vs Walmart

When Wal-Mart announced plans to use its retail locations to fulfill online orders last week, the media and business community broke into a collective game of word association. The word? Amazon.

Prior to breaking the news, Wal-Mart was already one of the few companies that could compete with Amazon online. But after unveiling how it plans to do so—by fulfilling online orders in its own stores—Wal-Mart became Amazon’s first serious threat.

The irony is that Wal-Mart will fulfill these orders using Amazon’s own in-store locker strategy. Wal-Mart has the significant advantage of already having 10,000 retail locations—something Amazon can’t currently compete with. For Amazon, staying competitive will either require rolling out a slew of its own physical locations (which is a possibility considering its test store concept last year) or establishing partnerships with 3rd-party brick-and-mortar retailers (something it is very much in the process of doing). In the meantime, however, all Wal-Mart has to do is boost its online game. Well, and install the lockers.

Clearly Amazon and Wal-Mart have different product sets. They also don’t overlap 100% in target customer bases, and there are a bunch of other things that are fundamentally different about their models… But for the sake of oversimplification, let’s say that all Wal-Mart has to do to rise to ecommerce supremacy is up the online ante. What exactly would that take? A lot. But Wal-Mart’s two most crucial priorities will be helping online customers navigate its extensive product list easily and quickly, and streamlining online and offline operations to create a turnkey overall experience.

Priority #1: Wal-Mart must transform itself into an invisible (and psychic) personal shopper to help customers navigate its vast inventory.

Like Amazon, Wal-Mart has a massive product offering. This isn’t a new problem for either of them, but as the race to fulfill orders guarantees quicker turnaround times and more convenience after placing the order, Wal-Mart must control every thing it can before the order is placed to ensure it’s actually placed through them. In this case, that means making sure customers can find what they’re looking for, quickly and easily. Or, in the case that customers don’t know exactly what that is, helping them figure it out with a fairly high degree of accuracy.

The good news is that this isn’t Wal-Mart’s first rodeo; they’re not exactly starting from scratch. They know who their customers are and they’ve got tons of data from past purchases and online behavior to inform their efforts.

They’ve also got enough content to appeal to every person in the US if they want to – it’s just a question of surfacing the right content to the right people. Therefore there is no extra work involved in getting more products or content; the challenge is simply using it better.

To act as an invisible personal shopper, Wal-Mart must master what they do with this powerful combination of content and data—and when they do it. The goal is to use it in real-time, as customers are browsing their online store.  This is different from standard product recommendations—things like “people who liked this, also like that”–which online shoppers have become accustomed to. Retailers now have the technology to go far beyond these persona/segment-based tools.

They can make use of both historical data (what this particular individual has looked at and/or purchased in the past) and current data (what this particular individual is looking at right now) to make predictions that will shape a particular customer’s experience in context and real-time.

Priority #2: Create a streamlined and turnkey experience across all touch points between online and offline visits.

With this new model comes the potential for far more room for error than ever before. Online customers who will now be traveling to Wal-Mart’s physical locations to pick up their orders will no doubt expect a consistent experience from the moment they order all the way to fulfillment. Along the way, there are a number of touch points, including email, direct marketing, advertising, customer service, and so on.

Building on the idea of personalizing each individual’s online experience, Wal-Mart can easily improve each subsequent experience—something that may seem like it involves a significant level of complexity. But with the right infrastructure, it can be completely automated and dynamic.

The key to accomplishing this is putting visitor profiles at the heart of each cross channel experience. In other words, Wal-Mart can use the same model of targeting used online to inform which content each customer sees across all other channels. In the end, the digital channels match email marketing matches advertising matches direct mail matches messaging at the point of pick-up (a phrase I just coined, mind you), and so on.

At the end of the day, Wal-Mart’s rise to online dominance really just revolves around turning an otherwise complicated shopping experience into one that feels quaint and easy. It can accomplish this by setting up a strong behind-the-scenes infrastructure that puts the customer experience at the forefront. And isn’t that what their new strategy is all about—giving the customer what they want where they want it?

May 22, 2013by Paul Dunay
Commerce, Conversion Optimization, Customer Experience, eCommerce, Leadership, Online Testing, Optimization, Personalization, Testing

Why CMO’s Need To Be More Involved in Ecommerce

eCommerce

If the $42.3 billion spent online this past holiday season has taught retailers anything, it’s that capturing customers—and their dollars—online is crucial.

But online is a big place. And mobile, which can seem like an entirely different universe, looms ever larger. So where to even start if you haven’t yet…started? And who should lead the charge?

The modern day merchant must have an intimate understanding of the importance of online and mobile commerce, access to a vast array of customer data, and a strategy for transforming this analytical data into winning online experiences.

In all cases, the goal is to attract and retain both new and returning customers. Whether online novices or experts, business leaders crave insight on how to accomplish this. The question is: who inside the company can embody these traits and help the CEO rule the roost? That responsibility should belong to the chief marketing officer.

A CMO should be somebody who uniquely understands marketing, merchandising, data, analytics and web design, and who can also maintain a creative, innovative organizational structure. IT tends to lean too heavily toward data for data’s sake, while Sales too often relies on revenue and relationships.

Placing the CMO in charge allows for the best of both worlds. Armed with the science of data analysis and the art of consumer engagement, the CMO is well positioned to emulate merchant princes of old and join the ranks of retail royalty. A good CMO can nurture a culture of testing, measuring and learning instead of depending on guesswork and subjectivity, as well as reach out to those on the front lines of customer interactions to figure out what those customers want. The ambitious CMO knows that their company site must be more engaging than the competitions’, as well as a place that customers trust, valuing the available products, services and information on offer. It also needs to be a reliable gateway to actions that grow sales beyond the initial purchase, such as cross-selling and upselling.

What’s the best way to make all this happen? One word: data.

Data is crucial to online retail. It comes in many different forms, the main type being the individual behaviors of current site visitors: which search term or webpage brought them over, what time of day and day of the week they’re most likely to stop by, what recent purchases they’ve already made onsite, what pages they visit and what product categories most interest them. All this pertinent info helps define what the “best content” is for each specific viewer. Other types include customer relationship management (CRM) data and social media data.

The aspiring CMO must then use this accumulated data to gain perspective on what customers want; analytical optimization and personalization tools will aid in this quest. Segmentation sifts through the data to find discrete groups of people with similar traits and/or interests, who can then be targeted and tested with relevant content based on site activity. Product recommendations and other offers are then provided based on what the various groups are most likely to purchase.

Product information tools give customers a deeper understanding of the product at hand—a 360-degree view of an article of clothing, or a close-up of various types of textured materials. User-generated content, like ratings, reviews or social media feedback, also aids and influences purchasing decisions. The savvy CMO uses all these methods to strike the delicate balance between intuition and analysis.

May 15, 2013by Paul Dunay
eCommerce, Optimization, Testing

Your Testing Program: Smart Ways to Get Your Team On Board

Team

On the face of it, the idea of a rigorously testing and optimizing your ecommerce web site seems like a no-brainer.

After all, who would object to gathering hard data on exactly how customers move through your site, what happens on specific visits, and what unseen speed bumps and sticking points are hurting sales? Who wouldn’t want definitive answers to such questions?

Fact is, though, in many online marketing organizations, there is often surprisingly sharp resistance to technologies such as multivariate testing.

Sometimes, it’s simply because there’s some confusion about how multivariate testing actually works and what the benefits are. (“You’re going through all this to test the color of the ‘Buy Now” button? Really?”)

But the real problem usually is buried a little deeper. With hard testing comes the threat of upsetting or overturning some cherished beliefs, or disproving what people ‘know’ to be true. Marketing and creative teams have traditionally crafted websites around ‘established principles’ and ‘gut feel’ for what works. (What if that isn’t so? What if we’ve been dead wrong all this time?)

The IT people build the site a certain way because it’s simple and robust makes perfect sense in terms of data flow. (But what if that actually turns customers off? What if that makes shoppers bail out before buying?)  The notion of actually testing ingrained practices is a bit scary.  Who wants to have their worldview changed?

In other cases, there’s some reluctance to admitting there’s even a problem.  “We’re getting X% conversions. That’s the industry norm.  Nobody is complaining. Why bother?”

The best approach to getting buy-in for a testing strategy is to position it as less of a of a threat, and more of a way to ‘refine’ and direct the efforts of your creative, marketing and IT teams.  It’s a way to out-smart, out-maneuver, out-think your competitors; it’s not a way to beat up on what we’ve been doing.

Detail the pain, document the bad

First step:  point out the pain points on your site. Are visitors fleeing as soon as they arrive? Are they actually buying or just poking around?  Do they buy once, and disappear forever?

To make your case, use strong graphics, charts, video clips, whatever it takes. But make sure the visuals are backed up by solid data that will speak to your audience: You bounce rate, cart abandonment rate, search engagement and average order value. Make the pain and problems clear, and the idea of a testing program will be much easier to sell.

Add up the losses

Find a way to dramatize and quantify how much money you’re losing in the current situation.  Then show how much more money the company could be making if you could get hard data on exactly what’s working and what’s not working.

Bring up smart competitors, industry darlings

Peer pressure is another go-to tactic for getting reluctant executives to embrace change. Explain how other respected, successful organizations are leaping ahead by definitively testing what they’re doing. For examples, check business publications, LinkedIn, public case studies, blogs and so forth.

Nobody likes to be left behind — if stakeholders see other businesses are implementing test programs to their benefit, it’s more likely they’ll want to do the same. And if competition’s already ahead of the game, even better for you. (Although the alternative is that they’re not and you can beat them to the chase.)

Speak to IT on their terms

Your development teams may feel that site testing is unnecessary, especially if they’ve already evaluated usability and other qualitative factors. They may consider testing their domain, and not appreciate any input from the marketing department.

Address these concerns by speaking their language and giving them concrete information they can actually use in making development decisions. Don’t just have a verbal discussion — provide all those statistical facts in writing, in terminology they know and use. Point out that shifting the responsibility of site testing to marketing frees up IT time and manpower to work on other projects.

Relate it all to the brand

In a critical way, the e-commerce site is the final touch point, the ultimate ‘proof’ of the brand concept. Does the experience on the website match the brand promise? Does it reinforce and capitalize on all the branding efforts so far?  Is there something we can do better? Something in our web experience that is somehow compromising our brand?  Multivariate testing can quantify this very accurately.

“Just try it”

Finally, propose a trial run — a limited test, shown to a small percentage of page traffic. Be sure to track key data points like visitor stats, cost per conversion, and abandonment rates. Once the results are gathered, share them with various departments throughout the company. As more co-workers find out what’s going on, your potential support base will become even larger.

April 10, 2013by Paul Dunay
Behavioral Targeting, Commerce, Conversion, Conversion Optimization, Customer Experience, eCommerce, Interactive Marketing, Personalization, Testing

More Traffic? Or More Conversions? No Contest.

traffic-evaporation

A bit of a trick question: If you had $100 to spend, would you be better off devoting that money to doubling the traffic to your site?

Or doubling your conversion rate?

Many marketers get this wrong.

Despite years of front-line, real-world experience to the contrary, more and more online marketing budgets are disproportionately aimed at driving traffic, rather than conversions.

There’s the notion that things like SEO, PPC, affiliate marketing and the like are far more important than increasing shopping cart sizes, decreasing abandonment, upselling and cross selling.

To be sure, driving traffic is a critical mission for any e-commerce site.  After all, no visitors, no sales.

But at the same time, even the most brilliant SEO or affiliate strategies will be for naught if the site itself fails to entice customers to actually buy.

That’s precisely where site testing, optimization, and personalization come in.  Failing to actually sell goods on the site can cost brands the effort, the dollars, and the brand equity that they devoted to attracting all that traffic.

Doubling your conversions can be dramatically more profitable than merely doubling your visitor numbers. And here’s why:

You want insight, not just raw numbers

Slice and dice your site traffic analytics all you want. But at the end of the day, they are still just numbers. What rings the cash register is actionable solutions you can use to improve your customer experience.

The first step is to employ an internal test-and-learn methodology to understand what visitors to your site are engaging with, where they’re dropping off, where their gravitating towards. (Hint: this may even differ by traffic source!)

But only through continuous A/B and multivariate testing, can you actually begin to understand your visitors and place content decisions in their hands. You can fundamentally change how your organization learns about its online traffic. In other words, nobody should be increasing traffic or making a site without a focus on improving conversions.

You want sales, not just visitors.

Yes, going to your boss and detailing how you doubled site traffic in the last quarter is a grand accomplishment! But can you really document how that increased traffic contributed to sales? Do you really know?

If you aren’t tracking conversion rates, or attempting to optimize the site in any way, boosting traffic rates is simply doesn’t matter.

Once visitors land on your site, your goal is to get them to buy (and hopefully become repeat customers). This is where testing and personalization are essential to turning traffic into sales.

Optimizing your site for content, design, offers, and copy is the only way to ensure your are taking full advantage of your site traffic. If the experience is irrelevant, frustrating or cumbersome, you might as well have not ever invited them to your site in the first place.

Better experience, more dollars

Today’s consumers are good at comparison shopping. They research, they sign up for emails, they track down deals.  Which may lead you to believe that the key is to boost your traffic as much as possible.

But the reality is, if you provide a really stellar online experience, they will want to come back, again and again. Which makes the overall job simpler, and clearer.

Thanks in part to more advanced testing methods, it’s a lot easier to listen to what your visitors want (and need).  Customers have become a lot more vocal even if they don’t know it. Through their clicks, page views, bounces, reviews and purchases, your online customers offer real-world feedback about their online experiences, in real-time. So pay attention to them. Make website changes and marketing decisions based on your customers, not on what your gut — or marketing budget — is telling you to.

Personalizing wins

Getting into a traffic war with your competitors is a sure-fire way to waste resources and precious attention.  It’s far more effective step up your game by using testing and conversion optimization to gather data and visitor profiles that can dramatically increase actual sales and repeat visits.  You may even find that segmenting your customers by where they came from can help you convert them into loyal and repeat buyers.

When it comes to their websites, major e-commerce players need to realize that only through a customized combination of multivariate testing, optimization and personalization best practices can they truly begin to tailor experiences in meaningful and profitable ways. It’s an ever-evolving practice that reaches miles beyond SEO, ad targeting and landing page optimization. But the rewards of it means a lot more return traffic, and a lot more improved conversions.

Follow the money

No matter how you define a conversion, at the end of the day, the holy grail for e-commerce marketers is to increase site sales. And the dollars are in the details, not just the volume. Focusing on conversion rates is where you’ll see not only site engagement improve, but revenue as well. Your traffic drivers might bring you more people, but conversion strategies bring you more money. No contest.

When it comes to site optimization and traffic acquisition, the best brands aren’t just surviving — they’re thriving. By focusing on the deep analytics and insights gained from testing with online customers, not just boosting traffic, not only improves the efficiency and effectiveness of their e-commerce site, but several other aspects of their businesses as well. They have a better grasp on who their customers are, how they buy, when they buy and what they buy.

In short, they can offer experiences more suited to customer needs and wants — and that is the true goal of any e-commerce business.

 

April 10, 2013by Paul Dunay
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Welcome to my blog, my name is Paul Dunay and I lead Red Hat's Financial Services Marketing team Globally, I am also a Certified Professional Coach, Author and Award-Winning B2B Marketing Expert. Any views expressed are my own.

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