February 10, 2013

Dear Catalog CEOs: Clario

Dear Catalog CEOs:

I wouldn't need to address this topic if it didn't keep coming up.
  • "We're looking to cut back on catalog expense.  We don't know whether we should choose you, Kevin, or Clario Stream?  The Clario folks sound impressive, but the content on your blog is also impressive.  Help us make the decision."
This is a funny question (came up three times in one day last week).  Most of my clients hire me outright (they call, we talk, they choose me on the spot).  About 25% of my potential clients demand an RFP, then compare me to other vendors.  Frequently, I'm told that I beat Clario, or Clario beat me.

In other words, Clario is my #1 competitor.

How do you treat your #1 competitor?

I'll tell you how to treat my #1 competitor ... hire 'em!!

If your goal is catalog contact optimization, they will do a fantastic job for you.  Clario applies cannibalization rules (if you don't agree with the concept of cannibalization, don't work with Clario, it's the secret sauce that makes their methodology work) to your contacts, at a customer level ... they model customer response, and they turn circulation selection into a turnkey, cloud-oriented process.  They'll make you a fortune.  You'll barely have to do anything.

I've been hired a few times to evaluate Clario's performance.  In each instance, I strongly defended Clario - and remember, these companies could easily have chosen my algorithm over Clario's and probably would have had I not been kind - but if your competitor is doing a good job, you need to praise the competitor, publicly ... it's an outcome of having faith.

There are consistent criteria where companies hire me instead of Clario.  I'll document what those criteria are:
  1. Client wants control over catalog circulation, doesn't want a black-box solution.
  2. Client wants accurate forecasting of demand at a catalog level, and at an annual level.
  3. Client wants accurate measurement of sales driven to retail, paid search, email, online, affiliates, mobile, across different catalog optimization strategies
  4. Client wants simulations of marketing/merchandising interactions.
  5. Client wants a five-year forecast model that illustrates where a business is headed if major catalog circulation changes are made (by the way, I've been hired to forecast the long-term impact of Clario's decisions ... those are fun projects).
  6. Client wants to thoroughly understand the interaction between marketing strategies and merchandise category performance.
  7. Client wants to know the % of sales that will still exist online if catalogs are discontinued.
  8. Client wants to know the % of sales that will still exist in stores if catalogs are discontinued.
  9. Client wants to know the proper customer acquisition investment strategy to grow the business.
  10. Client wants geek-free communication ... no technical terms.
  11. Client wants to know the impact of pricing strategy on marketing investment.
  12. Client wants an easy and actionable "grade" to put in the database ... A/B/C/D/F ... a grade with circulation intelligence built-in.
As you look through the list, something becomes very clear.
  • Pick Clario if you want the very best contact optimization algorithm.
  • Pick Kevin if you want highly profitable contact optimization algorithms coupled with ad-hoc customized requests, channel knowledge, an in-depth understanding of "why" things happen across channels and merchandise categories, and a forecast of the future.
Either way, you're making a smart choice.  It's really just an issue of what you are looking to accomplish.

Thoughts?

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