April 12, 2016

Gliebers Dresses: Online Data

Gliebers Dresses, as it has been since 2009, is a fictional series designed to address business issues that tend to yield negative reactions if blatantly discussed out in the open. If this isn't your cup of tea, then click here and read this article about bots and the future of marketing.

Glenn Glieber (Owner, CEO): Spring in New England, wow, you can never predict it, can you? Who thought it would be this cold?

Meredith Thompson (Chief Merchandising Officer): My tulips are absolutely struggling. 

Pepper Morgan Pressley (Chief Marketing Officer): I'll tell you about struggles. We can't acquire a new customer to save our life.

Meredith Thompson: Are you mailing the wrong prospects?

Lois Gladstone (Chief Financial Officer): Maybe your email campaigns aren't relevant?

Pepper Morgan Pressley: Both of you need to stop reading trade journals.

Meredith Thompson: You didn't answer our questions.

Roger Morgan (Chief Operations Officer): I'll answer your questions.

Lois Gladstone: Dear God.

Roger Morgan: The co-ops are dying.

Glenn Glieber: Who died?

Roger Morgan: The co-ops. Just go look at response to co-op lists over the past five years. Performance is down 25%.

Lois Gladstone: Why are you looking at marketing reporting? You are the Chief Operations Officer.

Roger Morgan: My team writes the code that enables Pepper to make the decisions I want her to make.

Glenn Glieber: Roger, are you saying that my morning reports are influenced by the information you want me to see?

Roger Morgan: Now that's just ridiculous.

Glenn Glieber: So maybe our operations metrics really are that good.

Roger Morgan: Marketing reporting strongly suggests that the co-ops are dying. But there is good news. Really good news!

Pepper Morgan Pressley: Here we go.

Roger Morgan: There is a new co-op, called "Passages". They are going to do something so revolutionary that it really bends the mind.

Pepper Morgan Pressley: They are going to share profits with those of us who contribute names to their database for free?

Roger Morgan: Capitalism is all about obtaining assets for free, then repackaging the assets for a premium.

Lois Gladstone: Please make your point.

Roger Morgan: You are so crabby, Lois. Are you hung over again?

Glenn Glieber: Roger, you can't say that in the workplace.

Roger Morgan: She didn't answer the question.

Lois Gladstone: I don't have to answer the question. It's an inappropriate question.

Roger Morgan: It's inappropriate to ask me why I am looking at marketing reports.

Pepper Morgan Pressley: Can we please conduct ourselves with some semblance of professionalism?

Roger Morgan: Sure. The professionals at Passages are providing an innovative approach to co-op modeling. First, we give them all of our clickstream data, for free ...

Lois Gladstone (Interrupting): Did you say we will give this company all of our clickstream data ... for free?

Roger Morgan: Yes.

Meredith Thompson: If a customer visits our website and puts an item in the shopping cart and does not purchase, then Passages gets the information for free and then uses it to better target the customer to our competition?

Roger Morgan: And vice versa.

Pepper Morgan Pressley: You shouldn't worry about it, folks. The half-life of clickstream data is about seventeen minutes.

Lois Gladstone: How do you know that?

Pepper Morgan Pressely: A consultant told us that she analyzed the information across many clients. Her models show that clickstream data immediately loses value. By the time a new co-op can act upon clickstream data, the data will be useless.

Roger Morgan: That's nonsense. An agency wrote a blog post saying that clickstream data is really important, so it must be really important. No vendor would purposely write content that aligns perfectly with the products and services they are selling.

Pepper Morgan Pressley: Please list for me the Google searches you conducted two weeks ago.

Roger Morgan: What does that have to do with anything?

Lois Gladstone: Was that an inappropriate question, Roger?

Pepper Morgan Pressley: You can't remember your searches, can you?

Roger Morgan: Only Google remembers my searches.

Pepper Morgan Pressley: That's my point. If you cannot remember your own searches from just two weeks ago, how the heck is a co-op going to use clickstream data effectively when it comes to mailing a catalog weeks later? You proved my point. The half-life of recollection of your own searches is a few days, tops.

Meredith Thompson: I'll bet Roger searched for information about Woodside Research!

Roger Morgan: Bingo!

Meredith Thompson: Maybe relevant information has a longer half-life than irrelevant information. Could it be that Passages knows the clickstream information that is relevant, and the information that is not relevant? Who is to say that we are smarter than they are?

Pepper Morgan Pressley: Will Passages sell our clickstream data to online brands and major brands looking to augment their data with various overlays?

Roger Morgan: That's what capitalism is all about.

Meredith Thompson: Wait a minute. Let me understand what you are saying. We contribute clickstream data to Passages. Then they sell our data to Nabisco or Lands' End or Social Media agencies?

Roger Morgan: That's correct.

Meredith Thompson: Why would we ever agree to an arrangement like that?

Roger Morgan: Because we get to pluck names out of their database for just a nickel each.

Meredith Thompson: Wait a minute. Lois, you're the financial person, help me out here. We give names to Passages for free. We give clickstream data to Passages for free. Then Passages sells our sliced-and-diced data to other companies, while selling us regurgitated names for a nickel each?

Roger Morgan: For one-time use.

Meredith Thompson: So if they push the same name at us eighteen times a year, we pay for the name eighteen times?

Roger Morgan: That's what capitalism is all about.

Meredith Thompson: That's nuts.

Roger Morgan: We've been working with the co-ops for twenty years. Why are you raising a stink about this now? This is an established best practice.

Lois Thompson: What kind of car do you own, Roger?

Roger Morgan: A Toyota Camry.

Lois Gladstone: Let me propose something to you. You get to keep owning your car, ok? You pay for licensing and insurance. And gas. Lots and lots of gas. However, you give me your car for free, ok? And then I'll use your car for my Uber business. I'll drive smelly people around, smelly people will pay me, and when the car is running out of gas, you'll fill the tank for me. And if you need a ride, you can pay me to use a car that my neighbor gave me to use for free. How does that sound?

Meredith Thompson: It sounds a lot like what happens when I loan my car to my teens.

Lois Gladstone: We're not joining this co-op, are we?

Roger Morgan: Of course we are!

Lois Thompson: But you don't decide the marketing strategy at Gliebers Dresses. That's Pepper's job.

Roger Morgan: Riiiiight.

Pepper Morgan Pressley: We certainly cannot be in the first twenty-five percent to join. Our data would be overexposed.

Roger Morgan: And our marketing effectiveness would be better.

Lois Gladstone: All of our data will be overexposed. This is nuts. We cannot do this.

Roger Morgan: Eventually, every catalog will be in this co-op. We have to do it. Remember, we're having a hard time acquiring new names.

Meredith Thompson: Why can't we just acquire names online and bypass the co-ops altogether?

Roger Morgan:  Riiiiight.

Meredith Thompson: No, seriously, why can't we do that? Why can't we be like Zulily or Wayfair or Overstock.com?

Roger Morgan: Our customer is 63 years old and we generate response through catalogs, that's why. Besides, if we join early, the publicity will help us. It will be like free marketing.

Glenn Glieber: I love free marketing!

Lois Gladstone: What kind of business are we running here? One where we sit at the knees of four or five companies who determine how successful we will be and then get to sell out to big data providers for millions?

Roger Morgan: Billions.

Lois Gladstone: Billions?

Roger Morgan: Billions!

Lois Gladstone: But they don't do anything clever. All they do is aggregate free data, then they slice-and-dice it and sell it to people. It's like they copied the business model where mortgages were sliced and diced and resold.

Roger Morgan: Nah, the mortgage industry copied the co-ops. What the co-ops do is very clever. Lois, do you have the ability to use machine learning to anticipate customer needs?

Lois Gladstone: No.

Roger Morgan: Then please don't discredit people who possess those skills.

Meredith Thompson: The reason we are married to the co-ops is because we've downsized our marketing team down to nothing. We are fully dependent upon the co-ops because we don't staff our marketing team and our creative team properly.

Lois Gladstone: Is that true?

Pepper Morgan Pressley: Absolutely.

Lois Gladstone: How did we let that happen?

Pepper Morgan Pressley: You demanded four rounds of layoffs to save costs.

Lois Gladstone: Oh, yeah. Good times.

Pepper Morgan Pressley: Our customer acquisition team is down to one person. She just calls the co-ops and ask for names. That's her job. We pay her $39,000 a year. And the job only churns once every nine months.

Lois Gladstone: So our choices are to fully participate in all of the co-ops, or fully staff our marketing and creative teams so that we can do innovative work that allows us to bypass the co-ops altogether?

Pepper Morgan Pressley: Correct.

Lois Gladstone: Let's get ourselves in this new co-op!!!!

Roger Morgan: Then it's settled. By the way, I need a ride into town this afternoon. Can anybody help me?

Meredith Thompson: You can borrow my car for a nickel, one-time use only.