As at-home coffee retailer Nespresso is proving, customers want to love what they buy.
Getting consumers to remember ads long-term is good, but it’s not the ultimate goal.
For some small business, local relationships are key.
Traditionally, independent retailers have sought out their locations quite deliberately––an up-and-coming neighborhood or a particularly hot development, for example. However, things are changing, and unexpected sites (think abandoned buildings and the like) are turning out to be the winning ticket for like-minded business owners aiming to sell the idea of craftsmanship through their goods.
Take Boxpark in Shoreditch, London, for instance. Coined the “pop-up mall” for the people, Boxpark is made up of 61 shipping containers. The concept was founded in 2011 by CEO Roger Wade, and it allows independent retailers and artists to set up shop with relatively low lease expenses. The beautiful thing here is variety, underscored by the fact that even mega retailers have dropped by with “installations.” Gap experimented at Boxpark with an edited assortment called “Black is a Color.” For larger retailers, Boxpark is perhaps less about sales and more about brand exposure in a more artistic light.
A second London example is We Built This City, located in Carnaby. The shop showcases a curated selection of over 250 artists every month from area neighborhoods. The idea is to market souvenirs for tourists that depict a more accurate, genuine and artistic representation of the city, versus the cheaply made, mass-produced mugs, magnets and other paraphernalia so often found throughout London.
Another example is Strange Invisible Perfume in Venice Beach, California. Small and independently owned, this botanical perfumery is located right next to Le Labo, a major competitor, which might seem counterproductive. As it turns out, the two businesses have worked together to become a one-stop perfume destination for customers. The retailers also share similar brand beliefs and principles, which center on a bohemian, holistic perspective that weaves in an Old World dedication to their craft.
Lastly is Lacausa in Silverlake, Los Angeles. The name itself has a double meaning: their origin of LA (Los Angeles), CA (California), and USA (United Staes of America). In Spanish, the name means “the cause,” which references owner Rebecca Grenell’s mission to produce garments only under ethical environments in an LA factory and warehouse.
As these shops and collectives highlight, for many customers, the local connection is key. From featuring independent artists to developing products with local tie-ins, native relationships are a valuable commodity.
Branded filters cost a pretty penny, but the potential for exposure is huge.
Snapchat filters are not-so-slowly becoming the way Millennials prefer to communicate (at least, for fun). While older generations might find the filters silly, some retailers are capitalizing on their potential––that is, the fact that so many Millennials are exposed to them on a daily basis.
Snapchat filters use special effects to turn selfies (both still and video) into an animated image of the user’s choosing, such as a cat, a dog or a cowboy. The “snaps” disappear in 24 hours. Several celebrities––particularly those admired by Millennials––are avid Snapchat users, and whether they know it or not, many act as advertisers for brands via the products visible in their Snapchats.
So, what’s involved for a brand to deliberately capitalize on Snapchat’s momentum? Basically, three things: investment, strategy and archives. Let’s take a look:
1. Investment. Sponsored Snapchat filters are supposedly worth around $750,000 per filter for holidays. Weekday filters are around $500,000. You might be wondering which brands would ever invest that kind of capital for a simple filter. Fox Studios did for “The Peanuts Movie” around the Halloween time period, as did Gatorade during the Super Bowl.
2. Strategy. Remember that snaps go away in 24 hours, which understandably undermines the huge price tag. It’s a huge reason that the branded filter has to be done right. Think humor, impact and the capability to create buzz, but without being over-the-top or too “in your face.” The filter should relate to the brand without being overtly focused on the product. A toothpaste brand, for instance, could produce a filter where users brush their teeth to a sparkling sheen. The goal is to make users forget the content is branded at all––in other words, a seamless experience.
3. Preservation. In just 24 hours after it’s posted, a Snapchat photo or video is gone. But your branded content can be preserved via a compilation video of various users interacting with the filter. If it’s good enough (and funny enough), the compilation video will be shared on other social media platforms, even further expanding exposure.
Last May, Snapchat co-founder and CEO Evan Spiegel estimated the company’s daily active users at 100 million. More than 65 million of them, he said, send photos or videos to friends daily. Millennials absolutely love their Snapchat, and though it’s not an easy task for brands to take advantage of this particular medium, the dividends could be huge.
Report shows that digital wallets are gaining popularity––as long as consumers see immediate benefits
In the world of retail, the consumer wants to be first––and they respond best to marketing when there’s something in it for them.
At least, these are the findings of the 2016 Mobile Consumer Report compiled by Vibes, a mobile marketing firm. The study showed that consumers deliberately search for marketing campaigns that include some sort of immediate benefit, from easy-to-use coupons to customer loyalty programs.
The study also showed a general trend toward more consumers utilizing mobile wallets, such as Android Pay and Apple Wallet. With convenience at the heart, this technology makes coupons and loyalty programs an upfront benefit––and in some cases, they’re the reason consumers are using mobile wallets at all.
Here are some key findings from the study:
1. More than 80 percent of smartphone users surveyed rank mobile coupons as more convenient than the printout counterparts that must be physically taken into the store.
2. Almost 60 percent of consumers reported that their opinion of a brand would shift more positively if they received digital coupons and offers that they could save in their smartphones.
3. Approximately half of those surveyed said that when they click on a digital ad, they’d rather land on a mobile coupon page than the brand’s homepage, a transactional page or the retailer’s app download page.
4. A full 94 percent of mobile wallet users report they like saving personalized offers and coupons.
5. Just over 30 percent of smartphone users use a mobile wallet.
6. Just under 60 percent of those surveyed said they’d like to have text alerts delivered when updates on their orders are available.
7. Almost 80 percent of smartphone users say they’d view a retailer more positively and they’d increase their brand loyalty if they were to receive surprise rewards, exclusive content and mobile “happy birthday” messaging.
Jack Philbin, CEO and co-founder of Vibes, says the primary shift here isn’t in the customer-perceived value of coupons and loyalty programs, but rather how these benefits are delivered. The immediate nature of mobile delivery is a game-changer, he said, and provides big benefits to both consumers (convenience) and retailers (brand awareness and loyalty), making this form of digital consumption a win for both sides.
The future for social media and marketing is optimistic, but doubts remain
For marketers, social media could almost feel like a godsend. Consumers across all demographics have embraced Facebook, Snapchat, Twitter and a multitude of other platforms. Social media offers a unique, personalized, “friendlier” way to reach consumers––but does it actually work? Does it convert to sales? The general consensus is rosy, but not without critique.
Optimism comes into play when one considers how ubiquitous smartphones have become. More than 70 percent of women over the age of 18 have a smartphone, according to a recent report by Blackhawk Engagement Solutions. The primary use? Social media. As for dollars, more than $12 billion of the $69 billion spent in e-commerce during the 2015 holiday season was transacted via smartphones. That’s almost 60 percent more than those figures in 2014’s holiday season.
Impressive numbers, but in reality, social media’s influence whittles down to very little, says Jason Goldberg, SVP of commerce and content practice at Razorfish. A “buy” button embedded on Pinterest sites for major brands likely generates somewhere around 10 units of sales, he said. Engagement rates are similar for Snapchat and Twitter.
Point being, social media simply isn’t a huge driver when it comes to conversion––at least, not generally speaking. Some niche markets have seen success thanks to buyable pins on Pinterest, such as Madesmith, an online handmade goods marketplace, and Daily Chic, an online apparel retailer.
Part of the issue––aside from social media predominantly being a means of socializing––is that shopping on mobile typically isn’t as easy as on desktop. Consumers generally feel comfortable browsing, researching and comparing price points on mobile, but when it comes time to buy, they prefer the desktop experience.
However, that doesn’t undermine the power of social media to increase brand awareness among consumers, as well as market to them in a more personalized way. Rodney Mason, GVP of marketing at Blackhawk Engagement Solutions, predicts 2016 will be a big year for social media––that is, if brands can get on board and shift their thinking to align more closely with the mindset of the average consumer, who is firmly planted in the social media landscape.
According to a study by Blackhawk, 55 percent of consumers lean on social media to become educated on products, sales and marketplace happenings. Social media also allows consumers to have “conversations” with brands, as demonstrated by Babies “R” Us’ #BabysFirstKiss campaign, which encouraged consumers to post photos of a New Year’s kiss with their babies. This allowed users a chance to share part of their lives––a main draw of of social in the first place––while also getting the word out about Babies “R” Us.
Capitalizing on user-generated content is one way brands can continue the conversation on social media and generate content that resonates with other consumers. Another way is customer service, which also works to humanize a brand.
It seems we’re at the beginning of how social media plays with marketing, and 2016 will be a formative year.
Findings from SXSW Interactive
This year’s SXSW Interactive, which took place in March, featured all the usual high-tech suspects, from automated driver-less cars to VR headsets. There was also buzz about better ways to reach today’s set of consumers, bringing a focus to marketing that’s been somewhat absent in the past. And this year, one group got a lot of attention: Generation Z.
Who are Gen Zers? They’re people born after 1995 (or loosely in that age range). The most current generation (in fact, they’re still being born today), Gen Z follows Millennials. Some are teenagers, which puts them in a prime spot for marketers to analyze how their behaviors are forming.
Here are 10 things to note about Generation Z, based on information shared at SXSW.
1. Email is outdated. Gen Zers are three times more likely to open a chat message they’re alerted to via a push notification. They largely feel email is an outdated manner of communication.
2. If it’s not on social media, it didn’t happen. Material items are of less importance to Gen Zers than experiences they can post on Snapchat, Instagram and other social media platforms. Don’t be deceived, though – brands still matter, they just have less influence.
3. They’re diverse. This is the most ethnically diverse generation in our nation’s history. Almost 50 percent of Generation Z is made up of ethnic minorities, says Jaclyn Suzuki, Ziba Design’s creative director.
4. They experiment with who they are. It’s not uncommon for a Gen Zer to have several online personalities, bucking the traditional idea of individual identity. Some will have embarked on three different career paths before they’re 30, according to Suzuki.
5. Privacy has a new meaning. Gen Zers prefer to be reached through private forums as opposed to “loudspeaker” media such as Twitter and Facebook, says Jaclyn Ling, Kik’s director of fashion and retail services.
6. Mobile, mobile, mobile. Gen Zers as consumers are more likely by a factor of two to prefer shopping on a mobile device compared to an average Millennial, says Anna Fieler, Popsugar’s executive VP of marketing.
7. Move over, traditional movie stars. This generation prefers “real” celebrities made famous by Snapchat or YouTube. Only one traditional movie star – Jennifer Lawrence – made the list of top 10 influencers according to Generation Zers.
8. At attention…but not for long. The attention span of Gen Zers is estimated to be only eight seconds. (Millennials come in at 12 seconds.)
9. YouTube is in. A typical Gen Zer watches between two and four hours of YouTube a day, compared to less than an hour of traditional TV. They’re two times more likely to utilize YouTube than Millennials, and they also don’t use Facebook nearly as much.
10. They co-exist. This generation doesn’t define itself as doggedly by gender. Shepherd Laughlin, director of trend forecasting for JWT Intelligence, says 48 percent of Gen Z identifies as strictly heterosexual, whereas 65 percent of Millennials say the same. Gen Zers are also more likely to purchase clothes designed for the opposite gender, and they more strongly believe that societal diversity can exist in both race and religion.
Though generalizations can be perilous––particularly those concerning gender––it’s safe to say that a peek into a woman’s shopping cart can provide an informative glimpse into who she is and what she’s influenced by. The insight extends beyond the individual herself. What a woman purchases can also provide clues about the people in her life, such as her family, children and professional colleagues. Here are seven things to be learned from a woman’s shopping journey.
1. Loyalty is a two-way street. Loyalty programs and incentives give customers a reason to return while also helping the retailer better understand and tailor experiences to specific shopper preferences. Social media also plays a role. Tesco, for instance, increased its presence on Twitter to invite one-on-one interactions, which include dialogue with customers about product questions, issues, challenges and requests. This personalized communication has helped the brand overcome the perception that it’s just another faceless retailer.
2. A little treat is a nice surprise. According to an analysis by Baymard Institute, the average rate of shopping cart abandonment is 68.6 percent. The primary reason? Unexpected costs. Email reminders to “check your cart” give customers a nudge, but a more effective approach is to offer something that helps make up for the costs that caused purchase hesitation in the first place––think free samples, or a small percentage off the order total with a deadline.
3. Optimize mobile. A study by Forbes suggests that nearly nine in 10 smartphone shoppers reported a negative experience with mobile shopping. The biggest problems are difficulty navigating, inconvenient checkout, multiple steps to purchase and buttons that aren’t user-friendly. Some retailers, such as Nordstrom, have addressed these issues by implementing “one-click” purchasing in their mobile apps. Additionally, the primary functionalities are made prominent and clear.
4. Saying “thank you” goes a long way. A survey by CreditCards.com reports that three out of four adults tends to make impulse purchases, with women being more likely (52 percent of women versus 46 percent of men). Tongue-in-cheek post-purchase messaging might help alleviate the “fear” of an impulse purchase, such as a direct statement that references a promise safeguarding against buyer’s remorse. Giving a purchase attention, such as a dedicated “thank you” email follow-up, might also reassure customers that they made a good decision.
5. It’s not just about her. Not only do women influence the majority of purchases in a household, they execute most of the purchases themselves. They buy for husbands, children, colleagues and friends, from birthday presents to baby shower gifts. So, not all messaging should be targeted at the female customer herself. Product suggestions should keep in mind the breadth of who a woman buys for.
6. Eliminate product-search frustration. According to a study by Aisle411, approximately 13 percent of customers leave a store without the item they were looking for. Employees need to ask every customer if they found what they were shopping for, and it can’t just be lip service. If the customer searched in vain, a system should be in place to record requested inventory and alert customers when it arrives.
7. Leave them with a small surprise. A good customer experience is worth its weight in gold. For a woman with a busy life––family, kids, career, etc.––shopping isn’t always enjoyable; in fact, sometimes it’s just another item on the to-do list. It’s the retailer’s job to make shopping fun (or at least, pleasant), and a little something extra can do the trick. It doesn’t have to be a huge undertaking––think small gestures like free samples at the store or a nice note during online checkout.
The true meaning of “omnichannel” is a daunting proposition for many brands––so what’s the solution?
When it comes to the omnichannel experience, some might assume that retailers are the ones in control. But in reality, consumers are calling most of the shots, and brands primarily take a reactionary stance.
In the typical corporate discourse, the word “omnichannel” has become synonymous with selling merchandise through multiple channels––online, brick-and-mortar, print, etc. Really, though, omnichannel refers to the way consumers’ shopping and purchase behaviors have changed, placing the central focus back on the customer, who can now shop anywhere, and anytime. This has become the norm, and thus the expected way of doing business (at least, from a consumer’s perspective).
No matter where a shopper is physically––on the sofa, in the store, at a baseball game––they can access a purchasing path right from their smartphone. They’re not very interested in which channel they’re shopping from, and in a sense, this leads them to expect a seamless experience among all the various channels. This introduces a tall order for most retailers, and the question becomes, “Where should we invest the most effort?” versus “How can we accomplish it all?”
There’s debate surrounding when exactly the omnichannel force began to take hold, but many believe it was around 2008 or 2010, when a number of trends surfaced to create something of a perfect storm. Smartphones and mobile devices became ubiquitous. The capabilities of e-commerce sharply improved, particularly via shipping (better lead times, and often free). Social media ramped up, increasing “word of mouth” product information-sharing (including price comparisons). Strategies such as “click and connect” gave customers more purchasing choices, and products and services became more easily customized to optimize the customer experience.
Long ago, a small, local market was able to serve customers in a holistic fashion. This is a much bigger challenge for so-called omnichannel retailers, yet the consumer demands remain. All the benefit is with the consumer, and all the hard work is with the retailer. It’s a huge challenge for any brand to excel in every one of these areas, and some of these goals simply aren’t a reasonable reality for many retailers. Virtual inventory systems, for instance, are a huge and expensive undertaking, as are initiatives such as universal free shipping.
So, what’s the answer? Retailers might be wise to pick and choose the omnichannel areas they focus on and invest in. By editing the ever-growing list of consumer expectations, brands can create a solid experience that defines them––rather the customer doing it for them.
In an omnichannel world, engaging with customers in a genuine way matters more than ever
Despite the rapid advancements in retail technology over the past several years, it might be easy to overlook the simple, tried-and-true fact that customers are people, and relationships with them matter––sometimes even more than the technology.
Today’s retailers are intensely focused on the omnichannel experience, the multiple channels of the shopping experience, and the technological details of completing a transaction. These are important things, no question, but Pareto’s rule of 80/20 is most certainly still relevant to the retail market: 20 percent of customer relationships drive 80 percent of the profit. Why? Because positive customer relationships breed brand loyalty and repeat business. In other words, if they can count on you, you can count on them.
The omnichannel model is arguably focused on numbers, not people. After all, with the “shop anywhere” mentality of most of today’s consumers, every sale counts, which is why so many retailers are looking to automate sales transaction and streamline other interactions with customers. But there’s a difference between consumers and customers. The former simply makes purchases and doesn’t contribute meaningful to a retailer. The latter, however, is an integral piece to instilling long-term value, romance and profitability to a brand.
In his book, “The Endangered Customer,” Richard Shapiro outlines eight essential “checklist” steps for attracting customers. They are:
1. Make me feel welcome (hope)
2. Give me your full attention (control)
3. Answer more than my question (connect)
4. Know your stuff (trust)
5. Don’t tell me no (frustration)
6. Invite me to return (feel wanted)
7. Show me I matter (caring)
8. Surprise me in good ways (feel special)
These principles start with employees on the floor. Apple is a good example. Associates are trained on the technology, of course, but there’s also a focus on creating relationships with customers. Talent is important, but engagement matters too. In fact, it’s largely what builds the “soul” of brands––the emotions that customers associate with the brands themselves.
Back when mass marketing and big-box stores were at their prime, the goal was to constantly maintain prices that were lower than competitors. This led retailers (Walmart, for example) to streamline everything from logistics to store operations, resulting in a lean staff––and less people on the floor to connect with customers.
The modern equivalent of that scenario is brick-and-mortar brands competing with the ecommerce giants. One way they’ve tried to stay ahead is the “buy online, pickup in store” strategy, in which customers have the online advantage of fast purchase and same-day receipt combined with the physical store advantage of seeing the product in person.
The idea is great, in theory. But the technology required to enable a fully reliable “buy online, pickup in store” model requires enormous investment––one that most retailers haven’t made (and aren’t ready to make). This past holiday season, faulty systems left many “buy online, pickup in store” customers frustrated, standing in line, with no associate who knew where their items were (or if they were in the store at all). This is a good example of how rushing to implement technology as a solution can actually work to sabotage the brand.
In the end, customers are people who want help when they need it and who want meaningful interactions with a brand––through every step of the purchasing process.