Crutchfield Attribution: Re-Visited

Last week's "Crutchfield: An Attribution Nightmare" was one of the three most popular posts of 2011, and for good reason.  The text of the post outlines a shopping experience where attribution becomes challenging, even overwhelming.

I received a lot of feedback, via comments, via email messages, and via Twitter.  You don't get to view a full picture of reader feedback.  I do.  So it's time to share some of the feedback, and my reaction, don't you think?

Question:  Kevin, you clearly doubted your purchase, or you would not have waited a month to place your order.  Nobody waits a month to buy an item without advertising playing a major role in the purchase.

Kevin:  Oh boy.  In the article, and multiple times in the comments, I noted that the only reason the purchase was delayed was to make sure that delivery would coincide with a window in which my builder could install the television.  It's that simple.  If you choose to not believe me, well, then that's your choice.  I'm being 100% honest.

Question:  Kevin, marketers who think customers will find you without advertising will lose market share.  Focus on last click attribution or fractional attribution, ok?

Kevin:  Oh boy.  Have you ever conducted a test?  Hold out catalogs for three months, and hold out e-mail campaigns for three months.  Do sales decrease by 99%?  No.  Anybody who has analyzed a mail/holdout test knows that customers will find you without advertising --- and the stronger your brand is, the more likely the customer is to find you without advertising.  We're attribution professionals, and yet, we fail to execute Attribution 101 --- simple mail/holdout tests.  If your attribution professional fails to recommend mail/holdout tests as the cornerstone of a proper attribution algorithm, go find yourself a new attribution professional.

Question:  Kevin, marketing clearly played a role here, you said so yourself when you decided to search for a lower price.

Kevin:  I purposely placed this comment in here, because quite honestly, this is the only place where one can logically suggest that price comparisons played a role.  If I had found the item for $350 less with comparable shipping, sure, I may have made a different decision.  Why almost nobody talked about this is beyond me.  This is the essential piece of the attribution solution!  I literally told you that nothing influenced my decision, I literally told you that I did execute a search, and yet, the feedback focused on how to parse shopping cart abandonment emails into the attribution routine, or how to parse the gift with purchase into the attribution routine.

Question:  Kevin, if activities correlate with an outcome, it's probably a good idea to participate in the activity that causes a correlation, right?  So if a shopping cart abandonment email is highly correlated with a purchase, we should execute shopping cart abandonment emails, right?

Kevin:  Let's view this from a different angle.  Let's say that you send two email campaigns per week.  By doing this, all purchases are correlated with the activity of sending email campaigns to a customer.  Therefore, all purchases should be allocated to email marketing campaigns, right?  You'd never agree to this if you were a search marketer, a television advertiser, a catalog marketer, or if you had retail stores and you saw that email campaigns took credit for all store purchases.

Question:  How did you know that Crutchfield offered free shipping?

Kevin:  I've been a customer since the 1990s, and I recall purchasing speakers in 2008.  So, obviously, there is some brand loyalty, prior e-commerce activity, and decades-old catalog activity that fueled my knowledge of the brand, coupled with email campaigns over the past three years.  That being said, you don't allocate today's sale to email campaigns mailed three years ago, do you?

I'm not saying I have any answers, other than to execute some mail/holdout tests, and to not discount the impact of search in the purchase process.  I am saying, however, that we, as attribution experts, have clear biases that result in us giving disproportionate credit to the marketing channels that we align with.  And that's the important thing to take away here ... execute some tests, minimize biases, and always remember that a significant portion of purchases (in spite of what some say) happen because of brand loyalty, and not because of marketing activities.

Crutchfiled: An Attribution Nightmare

Attribution experts express confidence in their ability to parse an order across the activities that caused the order.

Oh boy.

Let me explain an attribution nightmare, courtesy of Crutchfield.

I was about to purchase a new television, a 46 inch model.  I decided to purchase the television from Crutchfield, because I knew I would get free shipping.

I made this decision on or around May 1.

In the first week of May, I received a small page count catalog from Crutchfield.  I looked through the catalog.  My television was not, to my knowledge, featured in the catalog.

In the second week of May, I researched the television I wanted to purchase.  I used Google.  I visited Amazon.  I visited J&R Music World.  I visited Best Buy.  I found the television I wanted to purchase.  I compared prices across brands.  I then visited Crutchfield.  The television I wanted was available.  I placed the item in my shopping cart.

In the third week of May, Crutchfield sent me an e-mail marketing message ... and surprise surprise, the television I wanted was featured in the e-mail marketing message.  Who knew?!  It's almost like Crutchfield scanned my cart and then advertised the item to me.

Late in the third week of May, Crutchfield lowered the price of the television.  Good for me!

Early in the fourth week of May, while reviewing my shopping cart, Crutchfield made me an offer.  They offered to give me a soundbar/subwoofer system, valued at over $300, for free, if I purchased my television.  Wow.  I added the soundbar/subwoofer to my shopping cart.

Midway through the fourth week of May, Crutchfield sent me an abandoned cart e-mail message, reminding me of the items I wanted to purchase.

In the first week of June, I added a mounting bracket to my cart, and I added a separate item not related to the television purchase to my cart.  I placed my order, saving about $50 on the television, obtaining a soundbar/subwoofer valued at over $300 for free, and getting free shipping as per standard marketing practices at Crutchfield.

Ok, attribution experts.  Tell me what caused this purchase?

• What impact did the mailed catalog have, given I already decided to buy the television prior to receiving the catalog, but given that the catalog was mailed a few weeks prior to buying the television (hint --- this is the crux of my stance on the "organic percentage").

• What impact did the first e-mail marketing message have, given that it featured the television I already placed in my shopping cart?

• What impact did the price change on the television have on my purchase?

• What impact did the offer of a free soundbar/subwoofer have on my purchase?

• What impact did the abandoned cart e-mail message have on my purchase?

• What impact did free shipping as a standard offer have on my purchase?

• What impact did Google have on my research?

• What impact did the fact that I already decided to buy this item before the marketing began have on my purchase?

• How would you, the marketing/attribution expert, parse this information without knowledge of the fact that I made up my mind on the purchase before any of the marketing activities were initiated?

Discuss.  Remember, I decided to buy a television from Crutchfield before any of the marketing activities mentioned here were initiated.

Dear Catalog CEOs: Crutchfield

Dear Catalog CEOs:

Many of our loyal readers forwarded this link from Harry Joiner, a noted E-Commerce Recruiter ... it is a video showing the new 3D catalog from Crutchfield. Click below to watch is video:

http://www.marketingheadhunter.com/2010/06/best-catalog-ever-video-crutchfield-mails-in-3d-you-gotta-see-this.html.

I know, I know ... you are going to tell me all of the reasons why this won't work. You'll tell me how you tried something like this back in 2002 on a CD that you sent to a customer and that didn't work.

Give Crutchfield two points for having the courage to innovate, to try something different. Couple that with the Catholic Church and their use of the iPad, and you starting to see the early seeds of the stuff that will replace e-commerce.

And rest assured, e-commerce is dying (I can hear the screams from all across America right now as I write this in the cloudy, gloomy 54 degree Pacific Northwest). Sure, customers will always shop online. But traditional e-commerce, where you depend upon Google to act as a traffic light for brands willing to drive on the information superhighway, the form of commerce where you physically visit a website and drill up and down and plunk items in shopping carts and measure clicks and conversions, that form of commerce is dying.

Why not be like Crutchfield, and at least try something different? Why not create a new channel?

Micro-Channel: Video And E-Mail

Staying with my current fascination of Crutchfield, here's how the venerable direct marketer uses video to describe the Polk Surroundbar.

It's quick, crisp, and complements text-based copy or user generated reviews.

Best of all, we capture this information in our database, right? We create an indicator that measures the most recent date a customer viewed a video (and we'll certainly get more sophisticated in time). And when we tailor our e-mail marketing campaigns, we sub-segment the video viewers from everybody else --- offering them vastly different content.

Eventually, we use Multichannel Forensics to see how video micro-channel users evolve and change, knowing and understanding the role video plays in the customer experience.

Fun stuff!

Consumer Reviews And Writing Copy Online

Consumer Electronics is one of the places where reviews are often utilized.

At Crutchfield, you might be concerned about shelling out almost $500 for a Blu-ray DVD player. But fellow consumers walk you through the process by stating their opinions, in this case, opinions of a Panasonic Blu-ray DVD player.

Pundits like to debate the merits of user-generated reviews. That's not what we'll discuss here.

There are folks who are paid to write copy. Sure, in some cases, the vendor dictates what must be written. In other cases, however, the copywriter plays a major role in the selling of merchandise. It's fascinating how the art of writing subject lines and paid search keywords is thoroughly explored in our industry. The art of writing honest online copy, however, is seldom broached.

Why don't we sell online? Why do we write such generic text, boring text that has been written so many times that the customer no longer choose to believe it, preferring to hear the words of a theoretically objective purchaser the customer never met?

And then we go a step further. We allow our customers to rate the reviews written by other customers.

Why don't we allow our customers to rate the copy written by our coypwriters? Wouldn't that be a spectacular way to learn the style of copy that customers really prefer? Why don't we let our customers rate the subject lines written in e-mail marketing? I bet we'd learn more from that than we learn from testing different subject lines --- we'd learn that the subject line that tested as performing 9% better, placing it in the "best practices" class, actually rated 2 out of 5 stars by our customers. Wouldn't that be a humbling experience?

As the age of unfettered online sales growth comes to a close, as we're forced to actually prove our worth by actually using the online channel to actually sell merchandise in a stagnant economy, we'll need to start over from scratch when it comes to writing copy online. We're going to need to learn how to sell all over again. There's no reason a new class of rainmaking online copywriters can't emerge from this movement.

Redirection: How Catalogs Create Demand For Online Pureplays

Given that catalogers seem to enjoy yesterday's discussion about the failure of catalog and multichannel marketing, is is appropriate to share the following outline concerning demand generation in 1994, 2001 and 2008. Of course, what follows in the image is only a theory of mine --- no hard evidence to prove one way or another. Click on the image to enlarge it.



















My theory suggests that catalog marketing is as effective as it has ever been. However, Google and Social Media have stepped in and redirected demand that would have gone to your brand.

Redirection (otherwise known as "transfer" in Multichannel Forensics) happens in many different ways.

• Google and SEO --- think about how many of you found my blog via Google/SEO?
  
• Google and Paid Search.
• Social Media --- Check out Manolo's Shoe Blog as an example.
• User Generated Reviews --- You see an item advertised in the Crutchfield catalog, you read a review from a customer on Amazon.com, and you ultimately buy the item on Amazon instead of Crutchfield.

Redirection is lethal for a brand that doesn't play along. Since this is just a theory, I don't have any solid numbers to back up my thesis --- I would surmise, however, that maybe 25% to 50% of your demand is "at risk" for redirection.

This theory suggests that we have two important objectives.

1. Prevent redirection of demand away from our brand.
2. Induce redirection of demand to our brand.

A metric like the "net promoter score" would be useful, wouldn't it? You look at the percentage of demand that is redirected to your brand, then subtract the demand that is redirected away from your brand. The net is your score --- positive is good, negative is bad. Think of Zappos. Their score has to be amazingly good, right? Footsmart sends a catalog, the customer checks prices online, and buys at Zappos where she gets the item tomorrow via free shipping. Footsmart gets a negative score in this instance.

Abacus/Epsilon --- what do you think? You could so easily help the catalog industry that pays your freight by generating an index of this nature for your clients. There you go, free product development information from The MineThatData Blog! You've got bright people, make something happen! Heck, toss me a few pennies, and I'll develop the prototype.

Too often, we view the world through tactics, like catalog marketing or e-mail marketing or paid search or SEO or affiliate marketing. How often do we view the world in the context of "redirection"? How might we approach competitive advantage via the concept of redirection?

Crutchfield Community

Crutchfield does an interesting job of blending together blog posts and forums in the Community Section of their website.

It is nice to be able to see how many folks viewed each blog post --- when you see a thousand or three thousand people viewing each post, you start to think that maybe folks find the content interesting.

Here's a link to the Crutchfield Community RSS Feed, if you're interested in subscribing.

Retailers Using Social Technology, Community, And RSS

In addition to the Saks Video Catalog, many retailers are using social technology, community, and RSS feeds in interesting ways. Many in our catalog audience are looking for new ways to have a relationship with customers. Let's review a small sample of brands using social technology in one way or another.

Urban Outfitters has an interesting site that features articles, videos, an RSS feed and a MySpace page.

Neiman Marcus communicates fashion via their InSite Blog.

Ice.com's Just Ask Leslie Blog combines customer questions and short features.

eBags uses bookmarks to tag items you are interested in.

Mac Cosmetics, a $274 million division of Estee Lauder, has customers who are literally inventing products for the brand, sharing the ideas on YouTube. Their product development folks should take a peek at this! My wife found the video when searching for ideas on how to store Mac products. Take a peek at YouTube to see how other folks are doing marketing and product demonstrations for you ... heck, this young lady has almost 14,000 views.

Nordstrom has a MySpace page for their BP division.

Paperspine, an online book rental brand, hosts a blog about books.

Zappos is using Twitter to allow folks to communicate about the venerable online shoe brand.

Patagonia hosts The Cleanest Line, a blog for employees, friends, and customers.

Overstock.com offers a diverse array of community-based options.

Crutchfield has a community section on their website.

Burpee Seeds features their RSS feed on the homepage.

Hallmark has an interesting blog for their Shoebox division.

Here's the Shutterfly community.

Use the comments section to share other ways that retailers are using social technology, community and RSS feeds to partner with consumers.