Sometimes they are brilliant and sometimes they are useless, but infographics are almost always fun. Here is one about brands and loyalty programs, courtesy of Get Satisfaction.
One of the most interesting factoids is that 60% of respondents intend to use the social web and networking tools to derive ROI from loyalty programs. If so, that would be a significant change from how the loyalty industry’s historically slow adoption of technology.
Enjoy!
ESPN baseball writer Jayson Stark has an entertaining and informational column this week about how the iPad has taken over baseball. Not just the device itself, but the information that it can display and the way that information is used.
Instead of relying on scouting notes, which are inherently subjective and qualitative, managers, coaches and players can look at opponents’ statistical tendencies – and video clips that back up the stats. Citing the Rays‘ Joe Maddon, Stark calls this the “second great renaissance” in baseball, the first being Branch Rickey‘s pioneering use of statistics from the 1920s on.
Marc Falardeau via Creative Commons
The theme of Stark’s column, obviously, is that knowledge is power. Many smaller businesses operate like the baseball teams of twenty years ago, knowing intuitively that more data would help them perform better but believing that experience and intuition can fill the gap. But like baseball teams that are slow to embrace statistics and technology, the difference in achievement is there for all to see.
Savvy marketers, of every size, know that there is no substitute for data. Judgment is important, and no business – or ball club – should be run by robots, but merchants need to have the most in-depth understanding possible of who their customers are, what they are doing, and what they want. Some if this information is difficult to obtain, but some is there for the taking.
For example, Zavee lets merchants see every purchase by a Zavee shopper, observe trends, and even determine which Zavee offers are working better than others. This is the kind of information that lets merchants segment their customers and market separately to each segment. It lets merchants test and evaluate marketing plans. And it helps merchants determine the return on their marketing investment. It even works on an iPad.
The Zavee takeaway:
I will be speaking tonight on a panel sponsored by the Broward County chapter of the International Council of Shopping Centers (ICSC). The ICSC is the world’s largest shopping center trade organization.
The topic for the evening is “Shopping Center Marketing and Networking Trends” and I will be speaking about how Zavee expands the reach of merchants’ word of mouth marketing, offers effective, affordable, easy-to-use loyalty tools, and provides actionable data about merchants’ customers and their purchasing behavior. More generally, I will be discussing how technology like the Zavee platform and the wide adoption of social media offer local merchants effective and affordable new ways to build their business.
Also on the panel will be several shopping center professionals plus a representative of Living Social. One of the points I intend to make is that Zavee’s social loyalty platform combines the social media tools that have helped Living Social and Groupon grow so quickly with the core loyalty marketing strategy of building long term value creating relationships between merchants and their customers. This gives merchants the best of both worlds: social shopping that builds loyalty as well as traffic.
The seminar is today at 5pm at the Hard Rock in Hollywood. If your business is in a strip center, why not call your landlord and suggest that they attend. What they learn can help them market better – and that can help you.
Bill Hanifin of Loyalty Truth recently posted about airlines and customer service, a post prompted by his trip around the world (Malaysia and back – that qualifies). My trips are rarely as exotic but I fly almost every week, primarily between Newark and either FLL or PBI, and primarily on Continental. Like Bill, I have a soft spot for airlines, having begun my career in aircraft finance. Again like Bill, I am amazed – and not in a good way – by the unforced errors airlines commit when it comes to customer service.
Bill writes that airlines should be using the wealth of data available to them to build in more flexibility in dealing with customers, some of whom may be very valuable to the airline. I agree, but I think that ignoring their own data is only half the problem. A lack of empowerment is the other. Associates can only be as flexible as the rules allow. And I have a hunch that consolidation has made carriers more rigid and reduced employees’ sense of ownership (anyone have similar – or different – experiences at newly-merged carriers?).
Bill isn’t a fan of unbundling, but my view is mixed. I think baggage fees are a slap in the face to passengers. Airlines ask us to cooperate in limiting what we carry aboard, then charge us for our cooperation. Nice. On the other hand, unbundling food is a win-win, because concourse food concessions are improving steadily at many airports just as on-board food is disappearing. Carrying on our own food is one of the few freedoms we have as passengers, and I wouldn’t want to turn back the clock.
via Flickr - where are the jonses
One of the biggest customer engagement problems the airlines face as they impose more rules, charges and limitations is that the customer-facing staff is constantly required to disappoint or frustrate the customer. The trick, whether in the cabin, at the gate or at the ticket counter is to avoid turning delivering bad news into delivering bad service. Being told your bag has to be gate-checked is bad news; being made to wait for it at baggage claim is bad service. Being handed your bag at the Jetway is a smart way to ease the sting.
Flexible rules, empowered associates and a premium on resourcefulness can do wonders for an airline’s word of mouth. At a time when consumers are increasingly willing and able to share their experiences effectively, bad service is just reckless. If I hated Continental – and I don’t – I’m sure I could find a different way to get to Florida every week. Travelers under fewer constraints can drive to a more distant airport or just drive to their destination. And many people would just as soon stay home. Customers like me who really have to fly can use social media to make sure that everyone in our social graph – including whoever runs social media at the airline – knows exactly how and what the airline is doing.
The Zavee takeaway:
Richard Meyer has a typically thought-provoking post about customer engagement on his New Media and Marketing Blog. In the post he tees off on a research report that uses ‘likes” on Facebook as the sole metric of customer engagement. Richard has a big problem with this: “Who the hell cares who ‘likes’ your posts?”
Richard goes on to say that engagement “doesn’t mean a damn thing”. I completely agree that clicking the “like” or “follow” button doesn’t mean that customers are engaged, but I think there is such a thing as engagement. I also think that marketers can and should take steps to encourage engagement, but that ultimately they can’t control it. I also think that we are a long way from effective engagement metrics.
(Helena.40proof via Flickr)
Even in the absence of marketer involvement engaged customers can have a significant impact on sales. Because they may know more than the typical consumer and be more willing to share, they can be effective advocates for the marketer’s brand and products. Even if they point out product flaws or own up to having made a mistake in purchasing the marketer’s product (although Richard disagrees, Yelp and Trip Advisor contain plenty of reviews in which customers take at least some of the responsibility for their negative experience).
If the marketer does involve itself with its cadre of engaged customers it can do more than increase short-term sales. It can increase long-term sales by optimizing its business in areas such as product features, merchandise mix and customer service. By bringing them inside the tent the marketer may make these customers even more engaged and even more vigorous advocates for the brand and its products.
Customers don’t have to become unpaid product testers or spokespeople to be engaged. Engagement can include attending marketer-sponsored events or participating in marketer-endorsed charitable activities. By concretely affiliating oneself with the marketer and — critically — by sharing about it, engaged customers can drive the marketer’s message and build the marketer’s brand. Whether these activities result directly in sales depends in part on how they are structured and how the sales cycle normally works (cars and colas aren’t purchased the same way).
How vital is the marketer’s involvement to customer engagement? The short, if obvious, answer is that it can’t hurt. Perhaps surprisingly, however, some marketers with highly engaged customers have little if any involvement with them. One example, admittedly atypical in terms of both product and customers, is Ferrari. The Italian sports car maker has a passionately engaged base that includes not just current owners but past owners, hope-to-be owners and probably-never-will-be owners. This high level of engagement takes place with virtually no involvement from Ferrari, which pays attention only to the very top tier of its customer base (even for Ferrari, all customers are not created equal).
In the absence of marketer involvement, the Ferrari faithful have turned to enthusiast sites such as Ferrari Chat as well as marque clubs such as the Ferrari Club of America and Ferrari Owners Club (which hear from the marketer mainly when it believes its trademarks are being infringed). They have returned Ferrari’s lack of involvement by creating their own communities, whose benefit to the marketer goes unrecognized and unrewarded, but probably not unnoticed.
If it’s clear that marketers shouldn’t use likes and follows to measure engagement, what are some appropriate metrics? That will be the subject of Part 2 of this post.
The Zavee takeaway:
Zavee CEO Alan Pleskow and I attended the inaugural Rise of Social Commerce conference last week in Palo Alto. Big brands (usually) adopt new technologies and strategies earlier than small to medium sized businesses, so the conference provided a fascinating peek at how some of the largest companies are planning for and deploying Social Commerce today.
Social Commerce was defined by the conference organizers as “the use of social technologies to connect, listen, understand, and engage to improve the shopping experience.” For most conference attendees, the goal was removing the the technological, economic and operational obstacles that add “friction” to the online commerce experience.
(via x-ray delta one - Creative Commons)
Does that mean that Social Commerce is only for brands that sell online? And only for enterprise level companies? Not at all. Much of the learning around how consumers interact with brands and each other applies equally to brands whose customers make shopping decisions online but actually buy in-store. And much of the same learning applies equally to SMBs, even if some of their challenges are unique. For example, while SMBs are more likely to ask “How can I find the time?” than “Which department owns this?” using technology to become more customer-centric is something every business can do.
The organizers developed a conceptual framework for Social Commerce that has four phases:
The first phase is where many SMBs are today: working out the basics of consumer engagement on social platforms. Very few business we meet through Zavee still believe that social media is irrelevant to their business. Their most common issues are the time commitment required and the loss of control over their business’ message. Depending on the size of the business the time issue can be a real concern, but small businesses can start small, and increase their investment in social media as they begin to see results. As for the control issue, a few minutes on Twitter should open the eyes of any business owner about how much control they really have.
The second phase should be the destination for most SMBs, and they should get there as quickly as possible. This phase involves adding social content to the shopping experience: reviews from consumers, information and suggestions from the business, even content sourced from third parties. Regardless of whether the actual transaction takes place in the online or offline domain, enriching the consumer’s shopping experience through social content can have a significant impact on businesses of any size. Consumers respond to timely, relevant, personalized content by trying new businesses, becoming loyal customers and sharing their experiences with the community.
The third and fourth phases are over the horizon for many enterprises, let alone SMBs. The third phase involves bringing consumers into the process by which businesses create, buy, stock and price products, and the fourth involves completely re-imagining the retail experience. Some of the examples from the conference, such as Kaboodle and ModCloth, are very impressive. Many of the companies at the conference are looking to leverage Facebook’s enhanced commerce capabilities to bring the online store to the consumer rather than force the consumer to leave Facebook for an e-commerce site. SMBs may not be able to do everything these companies have done, but the underlying insight – that consumers respond to being included in decisions that are made upstream of the purchase – is something SMBs should consider making part of their strategy.
With so much emphasis on the enterprise, why did Alan and I attend this conference? It’s because we believe that the definition quoted above also describes what Zavee does for our merchants and shoppers. Our platform helps merchants use social media to listen, understand and engage with consumers. More importantly, Zavee is a community that supports the shopper-to-shopper and merchant-to-shopper interactions that lead to an enhanced shopping experience and a stronger brand. Adopting a Social Commerce strategy can seem daunting for SMBs, but with Zavee they don’t have to do it alone.
The Zavee takeaway:
As someone who enjoys – but doesn’t completely get – Foursquare and other “check-in” services on the Web, I was looking forward to the Location-Based Marketing Summit I attended last week in New York. I learned a great deal about this rapidly-growing field, and I had the chance to hear and speak with some of the people who are responsible for the latest thinking and most interesting developments in location-based services (LBS) and their application to marketing. Here are some of the things I learned at the conference:
via jorgempf (Creative Commons)
Engagement is everything. The hype about check-in services has obscured the wide variety of location-based services that are already available. The common denominator among them is engagement. How can LBS create engagement? One way is to deliver relevant information delivered in real time. Or, as one speaker called it, earning attention by being in “the right place, right time, all the time.” Another source of engagement is providing an enjoyable experience, such as by including game mechanics. On a superficial level this is how the check-in services work. But the real value of these services is relevance: for avid users, where their friends are and what they are doing right now matters. Another way to create engagement is financial: location-based shopping services that provide deals and discounts certainly have an audience.
Local is next. It’s easy to think of LBS as the province of large marketers, and it’s true that large marketers are better able than small ones to take the risk of jumping into LBS early. However, many of the speakers (and attendees) at the conference were talking about local applications. Why? One reason may be that, according to Google, one-third of mobile searches and 20% of all searches have local intent. That’s a big audience to overlook, and with the cost of technology decreasing, local marketers have a chance to engage with them using a location-based platform. Although local use of LBS is still in its early stages – for one thing, awareness of and interest in LBS is thought to be low among local marketers – look for substantial growth in this sector. And look for Zavee to be right in the middle of things.
Privacy is a transaction. This was one of the most eye-opening insights of the entire conference. No speaker disagreed that consumer privacy concerns were a legitimate issue for LBS and the marketers who use them. Several speakers, for example, were critical of Facebook for being insufficiently sensitive to users’ privacy concerns. But every speaker who discussed privacy at any length made the same point: While a service that exists only to push marketing messages will always have a privacy problem with consumers, a service that delivers a genuine benefit will find consumers more likely to share private information. The greater the benefit, the greater the sharing. This only works, of course, if consumers know what they are being asked to share – a potential issue with some advertising programs. All of the speakers at this conference, however, emphasized the need for LBS to be transparently opt-in with an easy way to opt back out. It will be very interesting to see, over the next several years, whether this transactional notion of privacy reflects consumer behavior or whether there are certain bright lines that no LBS can safely cross.
This has been a busy few weeks but our conference-going isn’t over: Zavee CEO Alan Pleskow and I are off to California for the Rise of Social Commerce Conference in Palo Alto – expect a post about it next week.
Permission marketing requires marketers to obtain the consumer’s consent before delivering a marketing message (one that is relevant and timely, of course). It is the opposite of traditional interruption marketing, which is delivered whether whether the consumer likes it or not. Permission marketing was an answer to an increasingly cluttered messaging environment in which marketers competed with each other to communicate with consumers.
(via Zoutedrop - Creative Commons)
A new way of looking at the question of who gets to reach the consumer focuses on a different dimension: not clutter, but time. Marketers are competing with consumers for the right to communicate. Consumers can, as Joe Marchese of Social Vibe puts it, “‘outbid’ marketers for their own attention.” In other words, if their time is worth more than marketers are willing to pay for their attention, consumers may be willing to pay not not to be interrupted by marketing messages.
So, what is a consumer’s attention worth? Most consumers behave as if their time and attention in short supply – something that increases with income. This makes attention an increasingly scarce, and therefore pricey, commodity. A marketer’s ability to communicate a message to a consumer comes down to what that consumer thinks their time is worth. In one of his posts, Marchese uses the example of a marketer who effectively values attention to a 30-second pre-roll (the ads before a web site opens) at one cent per impression. Marchese suggests that since almost everyone values their time at more than $1.20/hour, most would pay the penny rather than sit through the ad.
We can see this with smartphone apps, which often are released in both “lite” and “full” versions. The lite version has most of the web application’s features, carries ads and is free. The full version contains the full feature set but no ads and is not free. It would be interesting to know how much of the purchase price consumers who buy the full version are mentally allocating to the added features and how much to the freedom from ads. Still, marketers are drawn to this business model because downloads of the “lite” versions are said to drive sales of the paid app.
Smaller marketers aren’t competing for consumers’ attention with TV spots and web site pre-roll. Frequently, they are using inherently cluttered media such as newspapers and directories. But regardless of the marketing channels they use, small marketers need to understand how difficult it is to capture and sustain consumers’ attention. With limited time, consumers’ will pick and choose from the messages that are out there, or may simply decide that it’s worth some money to enjoy content free of any messages.
How can smaller marketers compete for consumers’ attention? If there is a market for consumer attention, presumably the price fluctuates. Smaller marketers need to be nimble enough to take advantage of these price changes and bid for consumer attention only when the price goes down. When does that happen? Perhaps when the message can be linked with something with which the consumer has a positive association. The most obvious example is the Super Bowl, in which the interruption of the game is not only accepted but welcomed. When else might the price go down? Perhaps when the consumer is engaged in an activity that makes them feel good, or feel good about themselves. Smaller marketers that associate themselves with a charitable cause may be able to communicate marketing messages as part of the communications that relate to the cause. And perhaps when the “marketer” is actually a fellow consumer. This is one of the insights underling social shopping: that consumers will more readily accept, trust and act on messages from peers than from marketers.
The Zavee takeaway:
Now that a New York court has dismissed claims against Yelp by a New York dentist based on a (very) negative review and on Yelp’s alleged removal of positive reviews, this might be a good time to think about what makes a review “negative” and what negative reviews mean to – and for – your business. You may think that negative reviews are just angry people taking shots at you. Here are four other ways to look at it:
via Marten Bjork (Creative Commons)
Readers recognize – and discount – outliers. Positive or negative, excessive emotions in a review diminish their credibility. It’s great to get an exceptional review for exceptional service. But if the glowing adjectives are out of proportion to a typical customer experience, readers are likely to apply the old saying: If something sounds too good to be true, it probably is.
Same thing with negative reviews. The surest way to lose credibility IS TO WRITE IN ALL CAPITAL LETTERS WITH LOTS OF PUNCTUATION!!! These are actually the best negative reviews you can get, because even if they are accurate, who will believe them? It’s true that some people write reviews to blow off steam, but readers know that, and respond accordingly.
Mixed reviews are not necessarily negative. Have you ever used Rotten Tomatoes to decide whether to see a movie? The site’s “Tomatometer” rating is based on whether published reviews were positive or negative. However, a review can only be either “fresh” (i.e., positive) or “rotten” (i.e., negative), no matter how mixed or qualified the review might be. For “Going the Distance” (51% rating), the fresh reviews include “solid but totally forgettable” and “hilarious in many individual scenes [but] less than the sum of its parts”. Rotten reviews included “funny but forgettable” and “The laughs kept me involved … but after I left the theater, it occurred to me that this slight comedy hadn’t gone very far at all.” Hmm. Many reviews – of anything – are mixed enough that it would be hard to give them either a thumbs up or thumbs down rating. So don’t consider every mixed review a thumbs down.
A mixed review is often more thoughtful, detailed and nuanced than an outright rave or pan. A customer who writes a review that contains some negative feedback isn’t venting, she’s helping. These are the reviews your customers will take seriously – and you should do the same. When you respond to reviews like these (easy to do on Zavee) you can use the review as the basis for an ongoing relationship. If you want a second chance at the customer and a more positive review the second time around, being proactive is the only way to get results.
Yes, competitors can try to hurt your business with fake reviews, but there are reasons you don’t hear about it happening very often. If you are running a good business deceitful reviews are unlikely to harm you, especially if you are actively communicating with your customers. Why? First, as discussed above readers will tend to discount rants whether or not they are malicious. Second, users of social shopping sites tend to be very skeptical of reviews that differ greatly from what most (real) customers experience. The unusual experience is another kind of outlier. On the other hand, negative reviews that go into detail about the experience and/or are written by a reviewer who has demonstrated credibility based on other reviews may well be taken seriously, but how many of your competitors are willing to invest that much effort just to undermine your business? If you are actively communicating with your customers you should be able to deflect even the most sophisticated malicious review. Finally, social shopping sites are trying to safeguard against malicious and fraudulent reviews. At Zavee, our system will reject a review unless the author has had a transaction at that merchant within 30 days of the review. Could a competitor jump through all those hoops just to hurt your business? Probably, but how many would bother?
A negative review is a positive experience. On the most basic level, a thoughtful review that recounts a negative experience provides valuable information for your business. You can’t be everywhere, and if a waiter or a sales associate didn’t behave appropriately, or if a product or service fell short of expectations, wouldn’t you want to know? Of course you would prefer to hear it privately, but in our increasingly social world these conversations are being held in the open. That isn’t necessarily a bad thing. A negative review can be a positive experience because your handling of the situation – again, in public – gives you the chance to move the conversation forward: increasing customer engagement and loyalty, building your reputation and your brand, and even persuading non-customers to give you a try.
The Zavee takeaway:
Anyone who has flown recently has experienced what the airlines call “unbundling”: separate fees for optional services that used to be bound up in the ticket price. Unbundling means, for example, that a passenger who flies with just a laptop bag will pay less than a passenger who checks baggage in the hold. The passenger who fills up at McDonalds or Starbucks before boarding will pay less than the passenger who wants an airline meal. The economics of unbundling fees for ancillary services have been amply discussed elsewhere: The airlines do well and the passengers … well, it depends.
From the passenger’s perspective, unbundling works best when (1) the service really is optional (i.e, the passenger isn’t coerced to to incur the fee) and (2) the fee itself doesn’t seem like an unreasonable money grab by the airline. Airlines are most likely to be successful unbundling services that a substantial number of passengers either don’t want or need or that they can easily live without or replace on their own.
Suitcases (via Malias - Creative Commons)
Zavee is an innovative social shopping network that combines the best elements of local search, loyalty marketing and social networking.
Zavee lets shoppers earn cash back rewards when they shop locally, strengthens local merchants and supports local causes.
