Archive for May, 2008

Are You Missing New Customers by Fishing With the Wrong Size Net?

Wednesday, May 28th, 2008

ais-ceo-mike-ferzacca.JPG The term “multichannel” is tossed around in direct response as a casual new buzzword that everyone claims to provide. However, there’s a difference between using multiple channels and truly having an integrated multichannel approach. The strength of a true multichannel approach is in the results that add up to more than just a sum of the various elements.

While you work with partners on different aspects of a campaign—creative, media, response/order take and fulfillment—you need to focus on the complete picture (and work with partners who allow you to do that!). Many marketers stick with what they know works and use traditional metrics to evaluate success. As media is expensive, it is understandable why that’s the case.

But, what happens when your customer sees that spot on TV and decides to purchase via mobile phone or web days after the airing? What about the customer who saw the ad, visited the site and did not buy? Or, what about the client who did not see the spot, but is a potential buyer because of his or her past history? Unless you have a plan to catch all of these opportunities you may not be using a big enough net—and you may not have the data you need to make decisions about how effective the media truly was. Take the multichannel integration test!

Consistency and Coordination
· Do you coordinate advertising events so all channels launch with the same message at the same time?

· Are changes to your DRTV offer or creative simultaneously reflected in online and mobile activities?

Analysis and Media ROI

· Do you view key metrics for all channels together to assess the full impact of your media, as well as the contribution from each channel?

· Do you know how buying patterns differ for customer purchasing via phone, online and mobile (upsell take rates, cross-sell success, etc.)?

· Can you identify how customers who purchase via the phone differ from those who purchase online or through mobile channels?

Revenue Opportunities
· Do you include a call-in option with online and mobile activities? (For example: We see lift of 10-30 percent in online conversion when we allow visitors the option to place orders by phone.)

· Do you tailor upsells to channel?

If you’re not answering YES to the above, you’re leaving sales on the table for someone else to pick up. So get a bigger net to capture ALL the sales generated by your advertising activities!

Mike Ferzacca is CEO of Advanced Interactive Sciences

ERA Conquers Capitol Hill

Friday, May 23rd, 2008

The following are a few photo highlights from ERA’s recent Government Affairs Fly-In in Washington.

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Upcoming ERA Networking Receptions:

June 10: NYC

July 16: Santa Monica

Email Katie White for more information at kwhite@retailing.org

Direct Response, Radiohead and Rain

Thursday, May 22nd, 2008

patrickpic.jpg It was supposed to be perfect. It was my birthday week and I had friends flying into D.C. so that we could go see Radiohead live at Nissan Pavilion in Bristow, Virginia. The concert was Sunday, May 11 and I had Monday off. Nothing could go wrong…until Mother Nature stepped in. Cell phone rings. “Are you guys even still going?” Claudia asks cautiously as I maneuver my way around the grocery store picking up last-minute tailgating items. “Of course we’re still going,” I say, somewhat irritated at the mere suggestion of skipping out. Sure, I had heard rumors of some rain, but I was fully prepared with my hooded sweatshirt—it was May!

Flash-forward two hours. We’re situated in lot B. Our other friends are over in lot A. No one in my car wants to get out. People in the cars around us are not getting out. “But Leikin flew here from Cleveland,” I plead, trying to motivate my peers. We finally manage to open the trunk door of Josh’s Toyota 4Runner. We’re happier once the beers start flowing, but it’s imperative to stay underneath the trunk door unless your drink of choice happens to be half Coors Light/half acid rain. It was at this point that things began to get delusional, yet laughable.

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“Oh my God! It is seriously raining harder now,”
Amber stammers as we watch the rain grow thicker and hear the pounding on the roof grow louder. Another concertgoer runs over to our car. “Can I make a quick call under here?” Yes, it was THAT bad. I begin to think about different products that would make the scenario easier. That’s the beauty of the direct response industry, solving a common problem that a consumer doesn’t typically think about. There was an extreme need for ponchos. What about an invention to protect your beer from the rain so you could still enjoy it? I couldn’t help but remember the umbrella hat I saw last September at ERA’s annual convention. I kind of mocked it then, but I would love having it right now! As we packed up our things to walk to lot A, we decide to leave all electronic items in Josh’s car. No cameras anymore, no cell phones, no iPods—only a credit card and license are deemed reasonable. Josh makes his last phone call, informing our friends that we’re on our way before closing and locking the doors.

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During the walk, the sky only gets darker, the rain harder and the temperature colder. We’re literally soaked from head to toe. Amber’s umbrella breaks because of the wind’s severity. As we approach lot A, we realize we can’t keep walking straight because a river has begun to flow right in front of our walking path. We manage to work our way around the river. Walking in jeans becomes arduous as the denim plasters itself to our thighs and calves. Where are our friends? We couldn’t call or text. We just had to keep searching.

“What the hell am I doing here? I don’t belong here…” ~ Creep, Radiohead

“Why didn’t you guys buy ponchos?” our friends in lot A scream, alarmed that we’re so drenched. “They haven’t made it over our way yet,” Josh explains, sounding like a movie line straight from a disaster flick. Byron lights a cigarette under their car roof, which they too were all huddled under. As soon as he steps out to greet me, the rain pounds his cigarette off of its filter and onto the ground. Jokes about Vietnam begin to seem appropriate. We’re now shivering. My entire body begins to shake. Then, out of nowhere, I hear Claudia’s voice. She approaches the group, umbrella in hand, raincoat on. “I have plastic bags wrapped around my feet under my boots and I also have a change of clothes in the car for the ride home,” she says. We all stare at her with jealousy. Some of the girls express interest in just going home. No way. We paid a lot of money and we’ve come this far. The worst of it had to be over, right? Let’s just hear one song and decide.

Onward towards will-call we go. We try to walk faster, but our legs are like liquorice in our soaked jeans. Toby tries to take his ticket out, only to realize his printed ticket is ruined—unrecognizable. Only those in sealed plastic bags will work. Our group unintentionally splits up. We can’t see anything in front of us. “Bruce?! Claudia?!” They’re nowhere to be found, but Bruce has my ticket! Even if someone around me does have their BlackBerry or iPhone, it is no help; no one else has their phones. Byron luckily has an extra ticket, so I make it inside the gates. Off to the lawn we go. People are falling down the lawn’s sloped hill left and right. Radiohead begins playing. The large screens are turned off for electrical reasons, obviously. Shiver, dance, shiver, dance, shiver, dance…

Back at the car everyone strips to their underwear, turning the heat up full blast in an effort to thaw out. What the hell just happened for the past six hours? Was this the worst concert experience ever? Was it the best? It was memorable none-the-less. I began to think of the concert in terms of being a product we bought. It was marketed to us as a rain or shine event, after all. The band had to be fully aware of the conditions outside. As they played one hit after the next, it seemed to me like they were simply using an age-old direct response format: But wait, there’s more!

It’s ironic that the same band that broke technology and industry barriers last year by allowing its new album “In Rainbows” to be downloaded for free on the Internet held a concert that reduced us back to the 1980s technology-wise. Without Byron’s extra ticket, I would have been wandering back to the car before hearing one song. We were all thrown for a loop without the gadgets we’ve become so dependent on. However, for as much as my generation is sometimes too reliant on technology, elements of our parent’s generation were clearly evident as we continued the simple pursuit of live music, much to the detriment of our comfort and health.

“For a minute there, I lost myself…” ~ Karma Police, Radiohead

Pat Cauley is Electronic Retailer magazine’s eMedia Editor

Live Shopping Bloopers

Wednesday, May 21st, 2008

katiewhite.jpg The home shopping networks we all know and love have sold numerous products over the years using detailed, well thought out demonstrations. However, with live television, mistakes are bound to happen. Robin Barr put together “The 7 Greatest Home Shopping Screw Ups of All Time” for Cracked.com. Enjoy!

Katie White is ERA’s retailer relations manager

Mastering the Marketing Mix

Monday, May 19th, 2008

tomquash.jpg “Marketing takes a day to learn. Unfortunately it takes a lifetime to master.” ~ Philip Kotler, U.S. marketing guru

I think the quote above succinctly sums up one of the truisms known to marketers. The business school practice of breaking down the definition of marketing into the 4 Ps is really oversimplifying a complicated art and science process that is fundamental to business success and growth. If you are developing a smart marketing mix, you must also toss in gut instinct, research, sales history, customer patterns, trends, competitive analysis and so many more factors. Even with all of this, success can explode from unexpected opportunities while sometimes the most thoroughly researched, planned and executed campaigns can fail miserably. Still, that is the beauty of marketing: it is never dull or routine. And today, marketers have far more resources to help drive sales and engagement than ever before.

As I begin a new chapter in my career by joining ERA in March, I think about the resources available to us today. In doing so, I can’t help but to reflect back on my first entree into the workforce, then too, in the marketing arena. It’s easy to dismiss as simpler times. It was the mid 1980s: typewriters outnumbered PCs, printed mailing labels predated Excel files and voice mail and fax were office novelties. By evaluating the bottom line and ROI, we believed our marketing efforts were successful back then. But who could predict that the introduction of the Internet and email to the masses was just around the corner? This would forever change the way we, as a society, communicate and access information and entertainment. It would also open the door to new strategies and tools to add to the marketing mix.

Today, it is much more than access to the Internet that allows marketers to brand product, advertise value and engage customers. Video streaming, HDTV, HD Radio, podcasting, TV on demand, mobile devices, blogging, wikis and online social networks have all played a role in expanding the marketing function and enhancing the customer experience. Some might suggest we are on the brink of the golden era of marketing. Perhaps. But what is certain is that today’s consumers have become more integrated into the marketing process. For marketers, this is a time of unleashed creativity. There are more opportunities than ever before to connect with customers, track patterns and utilize multiple formats to convey messages. Direct mail, TV/print advertising and other more traditional forms of marketing are still certainly relevant, but marketers no longer have to rely on a finite number of tactics to promote product. And few industries are leveraging these platforms as aggressively as the direct response community.

It makes for smart practice then that the association that represents this community would also leverage multi-platforms as necessary. At ERA, we too are on the brink of entering our golden era of marketing. Not because of my new role, but because it is what our community will expect and demand. I hope that you will check out the new ERA website, which debuts next month, and I encourage you to pay frequent visits to this blog. These enhancements are just the start of many advancements ERA will introduce to allow us to better brand ourselves, fine tune messaging, build member integration and promote the industry and its value and services through new and emerging technologies. These extensions and improvements in communications help us to better enforce our mission to drive, grow and shape the future of electronic retailing. Let’s master the marketing mix together.

Tom Quash is ERA’s vice president of marketing

New York’s Ambitious Sales Tax Law: Broader Than Amazon and the Internet?

Wednesday, May 14th, 2008

congressional-hearing-2.jpg Amazon says it is advertising when it compensates New York-based websites for posting links that refer customers to Amazon.com. New York says it’s soliciting business. The distinction means all the difference in the world for sales taxes, for Amazon, and possibly even print media, television and radio.

Amazon.com sued New York State earlier this month, challenging a newly enacted law that has serious implications for online advertisements. In April, the New York legislature passed a law designed to increase sales tax revenue from Internet sales. The law is known as the “Amazon tax” because of the way it broadens the sales tax law to apply to Amazon’s Associates Program, thereby achieving the necessary legal nexus for New York to force Amazon (and other Internet retailers) to collect and remit taxes on all sales to N.Y. residents.

A little bit of history helps put this law into context. The Supreme Court has held that a state can only impose sales or use tax-collection obligations on an out-of-state retailer if the retailer has a “substantial nexus” with the state (the Quill decision). Nexus occurs from a sufficient physical presence, which can be an office or warehouse, but physical presence can also derive from soliciting a state’s consumers via sales representatives located in the state. However, it can’t be just any sales rep, according to another Supreme Court case—in-state representatives must be “significantly associated with the taxpayer’s ability to establish and maintain a market in the state,” according to Tyler Pipe v. Wash. Dept. of Rev.

Amazon doesn’t have an office, warehouse or other physical presence in New York, but it has thousands of New York-based members of its Advertising Associates program. Per the Quill decision, advertising alone is insufficient to establish a substantial nexus. So New York has changed the definition of what it means to be a sales representative to capture these in-state associates that Amazon says merely hosts its ads. Under the new law, New York has changed the presumption of what it means to be “soliciting business” in the state. (more…)

Optimizing the Customer Interaction Experience

Tuesday, May 13th, 2008

rolf-elmer.jpg There’s no denying that the main objective for any e-commerce sales or retail marketing executive is to maximize the total value of visitor traffic on their site, simply put— turning web browsers into buyers and clicks into cash. Search is certainly leveling the playing field as well, so how do companies stand out from the crowd? And why are some sites still failing to deliver compelling and relevant content to their customer base?

In today’s saturated marketplace, retailers can no longer rely on the traditional marketing techniques and media vehicles to manage customer interaction and drive home sales. In order to achieve greater web interaction optimization, e-commerce and retail sites must recognize the inherent value of social behavioral merchandising and effectively increase the relevance of communications by automatically promoting the most relevant products to each visitor, thereby maximizing conversion rates and average order values.

By making websites more customer-centric via these “recommendation engines,” retailers can essentially optimize customer interaction through improved content and messaging based on a customer’s specific needs and behavioral patterns.

We all know who Amazon.com is. Besides the millions of SKUs at Amazon.com, the site is easy to use and “steers” browsers in the right direction when they need help (recommendations, user reviews, etc.). The addition of recommendations from other customers can build a sense of trust and community between new and returning customers—and probably better than any 17-year old working the floor at Border’s Books.

Given the wide variety of tools available in the market, online retailers must familiarize themselves with the different points of customer contact and approaches towards reaching interaction optimization. The Customer Interaction Cycle, shown below, depicts the many different points—from initial landing page through transaction—where collective intelligence can be applied to maximize value.

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Rolf Elmer is CEO of Avail Intelligence

Former ERA Chairman Passes Away at 83

Thursday, May 8th, 2008

MALVERN, Pa.—Robert Marsh, 83, founder of American Telecast Corporation, died of congestive heart failure, May 4th, surrounded by his family at his Pennsylvania home.

During World War II, he served in the Army Signal Corps in the Pacific Theater where he participated in several landings. He was awarded the Bronze Star. Marsh’s early career consisted of numerous entrepreneurial ventures. In 1975, he founded American Telecast, an industry leader in direct response marketing. The industry pioneer wanted everyone to succeed in business. He intuitively understood that if you help enough people to get what they want, you eventually get what you want.

Marsh is survived by Marjorie Damron Marsh, his wife of 61 years; two sons, John and David; and daughters, Karen Heft and Laurie Shipley; 11 grandchildren and nine great grandchildren. In lieu of flowers, contributions can be made to Operation Smile at 1-888-OPSMILE or 6435 Tidewater Drive, Norfolk, VA 23509.

Creep Into Your Customers Life Without Creeping Them Out

Wednesday, May 7th, 2008

candice-stewart_thumbnail.jpg Behavioral advertising, the anonymous or pseudonymous tracking of online activities for purposes of providing more targeted advertising and content, promises great potential for advertisers and publishers to build more relevant and trusting experiences for their users. But if you are thinking about using social or behavioral advertising because traditional display and email are yielding deplorably low response rates - don’t cross that fine line between creeping in and creeping out. Currently, consumers are unhappy with behavioral targeting practices, and now legislatures are getting involved. The New York State Assembly has plans to impose legal restrictions on the ways in which personal data is collected and used.

In line with the proposed New York State bill, a recent consumer poll conducted by TRUSTe and TNS Global indicates consumer demand for more transparency and user control around behavioral targeting. The survey provides insight into how marketers can make behavioral targeting more welcoming from a consumer perspective. Finding the right balance between wowing customers with superior customization and simply freaking them out will preserve consumer trust and help prevent state and federal legislation from curtailing your marketing plans for 2008.
Much of the evidence collected in the TRUSTe and TNS survey points to a consumer demand for more customized online ads and for an end to irrelevant, untargeted ads most commonly observed today.
• 87 percent reveal that fewer than 25 percent of the ads they see today are of any relevance.
• 72 percent of consumers find online advertising to be intrusive and annoying when ads are irrelevant to their interests.
• 64 percent say they would prefer to see only ads from online stores and brands they know and trust.
• 55 percent would be willing to fill out an anonymous survey about products, services, and brands they purchase in order to limit the online ads they see to those indicated in the survey.

But, according to survey results, two main obstacles threaten the promise of behavioral targeting: 1) the lack of consumer education and understanding, and 2) the lack of transparency and affirmative choice. Consumers indicate a high level of apprehension when it comes to tracking their browsing history and express little familiarity with the term “behavioral targeting.”
• 57 percent of survey respondents say they are uncomfortable with advertisers using their browsing history to provide relevant ads
• Only 40 percent of respondents are familiar with the term “behavioral targeting.”

While advertising based on anonymous information should be embraced by privacy sensitive individuals, there is still significant unease with behavioral techniques. This is not surprising when consumers are familiar with privacy mishaps such as the AOL search data disclosure, which allowed researchers to piece together several pieces of anonymous information to positively identify an individual. Seventy one percent of consumers said they were uncomfortable with third parties tracking their behavior for purposes of serving ads even when it couldn’t be tied with any PII.

Behavioral Advertising Dos and Don’ts

DO
- Matter-of-factly incorporate some disclosure of tracking and targeting as part of your product or service value proposition. Provide a “what is this” button to explain how your customization works.
- Make sure your service providers, agencies, and others are following industry standards for privacy notice and disclosure. The majority of serious complaints TRUSTe encounters are privacy breaches by marketing vendors.

DON’T
- Think you can get away with not giving your customers notice and choice. See Cathryn Harris v. Blockbuster.
- Undermine your investment in building your brand for a few response points. (more…)

Government Affairs: We’re All in This Together

Monday, May 5th, 2008

scott_0228.jpg Well, it’s getting to my favorite time of year! No, I’m not talking about the NHL and NBA playoffs, although they’re a bonus. I’m talking about an annual tradition where the cherry blossoms accent our nation’s capital and ERA members congregate to discuss with lawmakers important issues that affect the very vitality of our industry.

I was lucky enough to be embraced by the direct response community about 15 years ago. And, in that time, I’ve seen a lot of changes that have been mandated down to us by the very people we put into office to govern us. Most legislation I’ve applauded because it makes us stronger as an industry and solidifies our future. Some I’ve scratched my head at and wondered why they came to the conclusions they did. In the end, I determined that you and I are ultimately to blame for their poor decisions. WHAT?! YOU? ME?? How can one person or an individual be saddled with this blame? But, in reality, standing idly by and not participating in the legislative process is why.

ERA realized this fact three years ago and put together the Government Affairs Fly-In. It is an easy way to make our voices heard. I was fortunate enough to be a part of the first session. I was absolutely giddy to be a part of something so important. Upon arriving for the day’s events, we were broken up into teams and assigned a lobbyist that would serve as our guide through the halls and administrative offices of Capitol Hill. Each lobbyist caught us up to speed on the pending legislation. That year, it was net neutrality and online taxes, and how we could present our side of the issue in a uniformed and concise manner. We were also given a list of our congressional and senate members we had prearranged meetings with. Participation, so far, in the legislative process was as easy as getting on the waiting bus outside the hotel that took us to Capitol Hill.

Once on the Hill, our teams split up and headed for our perspective meetings. Standing on the front steps of the Capitol, I couldn’t help but feel dwarfed by the immenseness of what I was about to do. On the bright, sunny day, I reached the top of the stairs and took one last look down the Mall with its monuments and reflecting pools and knew this was going to be a special day. Entering the building I couldn’t help but feel that this is what our country is about. Hundreds of people swirled around me as they swept their way to their destinations at all levels of the rotunda. What struck me the most was how relatively quiet it was. I could hear every step I made on the marble floors echo through the labyrinth of hallways. It served as a comforting melodic beat as I moved to my meetings.

My first meeting was with a well-tenured congressman from Arizona. He and his staff were warm with their welcomes when we arrived. When we sat down, they listened respectfully as each one of us presented our part of the solution to pending legislation. It was an easy-going give and take of dialogue as the topics of our industry rolled on. Before I knew it, an hour had passed and our points were presented satisfactorily. Each meeting afterwards progressed in the same manner, with each party treating the other with respect and quite a bit of admiration for the task at hand. It was, to me, the democratic process at its best and as it was designed to be.

Getting on the bus to head back to the hotel, I took a last look back at the lit Capitol, shining outward into the night sky, and reflected. I realized then that we all made a difference that day because we came to voice our opinion on subjects that were important to this industry and to our livelihoods. I can remember a time when I thought I was a part of the legislative process by merely voting for my representatives. But, I now realize that checking a box (or hanging chad) is not the end of individual responsibility in the legislative process—it is only the beginning. The next step is as easy as joining hundreds of your fellow colleagues and me, on May 20th, on Capitol Hill for ERA’s GA Fly-In. I’m hoping to hear more than my own footsteps echoing through the halls, but rather the thunderous roar of all of us marching to ensure we influence those who influence us. After all, we’re all in this together!

Scott Swanson is vice president of sales for Motivational Fulfillment and Logistics Services

Have you been the GA Fly-In before? What was your experience like?

Saving the World Through Electronic Retailing

Friday, May 2nd, 2008

peter.jpg Every morning I listen to the radio while I’m getting ready for work. Today was kind of interesting in that there were several sound bites from the president and would be presidents about various ideas to solve the “energy crisis.” While I have chosen a specific candidate for whom I am rooting, I have to say that my candidate’s response did not impress me. In fact, none of the proposed suggestions impressed me. Each seemed to be a half assed suggestion designed to get votes that would end up costing us more money in the long run and would not present a real solution to the problem.

After the politicians got done railing about things government could do to solve the problems, there was another story that caught my attention. It seems the Rockefeller family is demanding that Exxon Mobil invest more money into research on alternate fuels sources. You see, the Rockefeller family has a $4 billion stake in Exxon Mobil and they have this crazy idea that maybe the company should do a little work to develop potential revenue streams in case the public has actually gotten the notion that dependence on a finite resource for all of their energy needs is sort of a bad idea, or in case that finite resource reaches the ultimate fruition of its finiteness. While this is obviously an instance of the Rockefellers wanting to remain rich (and who can blame them?), it is refreshing to see someone stepping up and saying “Hey, you know what, we have a few billion dollars in record breaking profits this year, let’s get ahead of the curve, stop waiting for government subsidies to support this research and let’s just knuckle down and build something.” In other words: getting America back to the business of doing business, instead of hiding in a corner bitching about foreign competition, waiting for someone to hand them a subsidy, a tax break, and a tariff to cover their ass…

By now you are sitting there thinking, “What the hell does this have to do with electronic retailing?” Well, hearing about the Rockefellers take action made me wonder: Although I don’t have $4 billion invested in a single chunk with a company I can influence, let alone $4 billion, I started wondering if there was stuff I could be doing that would make a little dent in the fuel situation. The consensus seems to be that fuel prices are being driven higher by demand. So, the solution would be to stop buying gas. Well that’s all well and good, but I already use public transportation to get to work (a luxury we have in DC), so the only reason I ever really use my car is to go shopping.

That was when it occurred to me that shopping online or over the phone is the equivalent of carpooling to buy stuff. Here’s the scenario: on my street there is never a parking space… (more…)