Sending Catalogs to Jasmine: A Bad Idea

And then there's Jasmine.


Brand marketers love Jasmine.  Advertisers love Jasmine.  They'll pay a premium to advertise on television shows frequented by 18-34 year olds.  She's the mobile/social/local guru that the pundits can't stop talking about.


If you're a catalog marketer, however, you want to steer clear of Jasmine.


You see, Jasmine (the Transformational cusotmer) thinks catalog marketing is something that her Grandparents participate in.  When you send her a catalog, this is what you're likely to see:

Jasmine isn't going to call Cuddledown of Maine to place an order.  And if she buys from Cuddledown of Maine, it isn't because she was mailed a catalog, it was because she has a need or because her friends told her to.  As she always says, "If I need to know something, the information will find me".


When you mail Jasmine a catalog, it looks like the catalog mailing is profitable.  But, it is not profitable.  In this example, only $0.69 of the $4.60 she spent online was "caused" by catalog mailings.  Again, the key word here is "caused".  Just because you mailed a catalog to Jasmine doesn't mean that it "caused" her to purchase.  You can easily verify this through mail/holdout testing to a segment of customers like Jasmine.


Jasmine warrants maybe one catalog a year, sometimes two catalogs a year.  We over-mail the living daylights out of people like Jasmine.  We'd be better served by investing the resources sending catalogs to Jasmine in business models and merchandise congruent with the way that Jasmine lives.


Want your own custom Judy / Jennifer / Jasmine segmentation plan and optimal contact strategy  developed?  Send me and email message, and let's get busy!!

Ladies and Gentlemen, Meet Jasmine

I previously spoke about a "Transformational" customer.  From this point forward, that customer will be known as Jasmine.


Meet Jasmine!


Jasmine is different than the customer we've been analyzing for a long, long time.  In fact, catalogers and many online marketers are uncomfortable with fundamental differences in Jasmine's behavior vs. prior generations.

• Jasmine is 27, but she is representative of a customer between the ages of 18 and 34.
• Jasmine doesn't have the earning power she will one day have.  Therefore, Jasmine has to find the best deals at the best prices.  She's not going to pay $400 for a handbag, when she can spend $99 for a handbag at a flash sales website.  
• You can't market to her by offering 20% off plus free shipping ... she simply won't buy unless free shipping is part of the brand, and she thinks brands inflate prices, so she's looking for deals that work for her.
• Jasmine approves of this (click here).
• Jasmine "lives" social and mobile.  This is a fundamental difference from Judy and Jennifer.  Jasmine's experiences are infused with social and mobile.  Facebook and Twitter aren't social media, they're "utilities", much like Comcast or your local electric company.  And this means a lot, because you cannot separate out and attribute social or mobile and assign marketing value to each channel.  She buys from Shoemint.com ... social and mobile and email ARE the experience, that brand curates for her, you don't separate and attribute her spend to any channels in this case.
• If Jasmine had to choose between internet access, a car, or her cell phone, she'd choose her cell phone.  The cell phone is to Jasmine as the internet is to Jennifer and as cable television is to Judy.
• Jasmine likes low prices, scoring a deal on MyHabit or One Kings Lane or Fab.com or Gilt Group.  She'll recruit friends to get discounts from businesses she shops at, she will use her phone to score a great deal, and she loves the simplicity of the mobile shopping experience.  In some ways, an element of gamification motivates Jasmine, she likes completing tasks and earning credits/discounts for completing tasks (see the first twelve steps required to be on Shoemint.com for an example ... go do that right now).
• Jasmine doesn't trust advertising as much as she trusts her friends and the opinions of others.  Her inner circle of 400 people provide all the information she needs to make good decisions.  She says that if something is happening in the world, "it will find her".  This is different than Jennifer, who spends time finding/hunting things, and is different than Judy, who likes to watch The Today Show to learn what might be important.  You will have to seed a lot of clouds to be able to reach Jasmine.
• Jasmine will take a picture of something she likes at Aldo Shoes, and solicit feedback from her friends before buying the item.  She might spend time at Best Buy with her husband, reviewing items, then comparing prices on Amazon while in-store, finally settling for a comparable item on Amazon.  While she participates in social commerce, Jasmine is almost post-social commerce, she's not going to be labeled, but instead, she is simply shopping in a way that is congruent with how she lives.  This style of shopping is not recognizable to Judy.
• Jasmine likes to share what she's doing, and likes retailers who make it easy for her to share ... notice that you click on "share with a friend" before "add to shopping bag" in this example at Francesca's Collections:
• Jasmine is not going to read a newspaper unless she's stuck at an airport for two hours and her iPhone needs charging.
• Jasmine likes Spotify, she thinks paying $10 a month for millions of songs is better than paying $0.99 per song.  Conversely, Jennifer loves iTunes, while Judy still buys CDs at her local Target store.
• All that being said, Jasmine will buy sheets from Cuddledown of Maine, but this behavior is not likely to be habit forming, and Jasmine had better get free shipping and an everyday low price.
• Judy loves a sale. Jennifer loves hunting for the best price. Jasmine shops if the business offers an everyday low price.  Jasmine will participate in a "gamified" experience that results in earning credits that yield a low price.
• Jasmine may or may not like this style of merchandising, but it is more aligned with her style than old-school marketing (click here please).  Conversely, Judy expects this content to be delivered to her via a television commercial.  Different approaches are used to reach Judy and Jasmine.
• Judy barely trusts having passwords online.  Jennifer has a hundred different online passwords.  Jasmine shares her passwords with trusted friends, it's almost a form of trust currency.

Last week on Twitter, an 18-34 year old individual told that people like Jasmine will "do the marketing for you if you treat her well and let her do her job."  This is the complete opposite of Judy, who waits for companies to rent her name from a co-op so that she can see their catalog.


It isn't hard to identify Jasmine in your customer base, so get busy!  Record the referring URL, any blogs in your industry or Facebook or Twitter are key indicators that you're dealing with Jasmine.  She's a "true mobile" individual, using her iPhone or Android device ... she may use an iPad, but that's more likely to be Jennifer.  She likes sales/discounts, but she prefers low price point items.  She demand free shipping. Heck, if you are Fab.com, half your database is comprised of people like Jasmine!  Even if you're a traditional catalog brand, you have online customers with no attribution to catalogs/email who shop infrequently, off price, with free shipping ... hint ... this is Jasmine!


We care about Jasmine, because the marketing strategy for her has to be very different.  In my studies, 50% - 80% of what Jasmine spends is not associated with catalog marketing.  In other words, catalog matchback programs significantly, and I mean significantly overstate what she spends because of catalog marketing.  Instead of 18 catalogs a year, Jasmine needs maybe 3, all within a month or two of a purchase.

So get busy segmenting your database.  Find out who Judy, Jennifer, and Jasmine are, and start treating them differently.  You'll be significantly more profitable, and you'll make Judy, Jennifer, and Jasmine happier.


Next week, we'll dig a bit deeper, learning more about how to deal with Judy, Jennifer, and Jasmine.

But What Is A Transformational Customer?

It's not hard to understand what a Traditional customer is, especially if you're a cataloger.


And it isn't terribly hard to understand what a Transitional customer is, most of us go through this stage at one time or another ... search buyers, for instance, are about five years into the "Transitional" categorization.


The "Transformational" customer, however, is tougher to pin down.


In 1995, this customer used Netscape, had a blazing fast 9kbps internet connection, and saw that email might one day replace snail mail.


In 2001, this customer used Google, had a MySpace presence, and stuck with e-commerce even though the rest of the universe was reeling from the dot.com bust.  This person could not understand how you could spend a fortune on an iPod when there were already many highly functional MP3 players, most less expensive.


In 2005, this customer had a blog and thought that Wordpress would kill Blogger. This person suggested that podcasts could change the world, listening to many podcasts downloaded from iTunes onto an iPod.


In 2008, this customer thought that brands could offer promotions on Twitter, and couldn't understand why more brands weren't engaging in f-commerce (Facebook Commerce).  This customer understood that Dell was wise to be an early adopter of Second Life.  This customer could see that flip phones were going to be killed off by the iPhone.


And now, in the waning days of 2011, this customer uses Shopkick to get perks at a local Best Buy store, recruiting gaming friends for a new release of software, earning virtual rewards in the process.


In other words, this customer is "out there".  It's not always the same customer, but it is always a customer operating on the fringe of your business.


This person sees things different than most customers see them.  This person abandons older channels for the simple pleasure of experimenting with new channels.


This customer is frequently wrong in the short term ... but is directionally right in the long term.


Our job is to identify the Transformational customer, because there is a lot of profit opportunity here.  We limit old-school marketing techniques with this customer, we experiment with this customer.


Now, I get it ... you're about to say ... "how do we identify this customer?"


Don't make it hard.  For instance, at checkout, simply ask the customer if they are on Facebook, if they are on Twitter, if they own a Smartphone.  Just this simple act pushes the peanut, folks.


Get a web analytics project on the book of work ... seek to integrated logged-on user website data with your customer data warehouse.  When the visitor comes via an iPad or iPhone, record that as a piece of "Transformational" information.


Then test your catalog and email marketing strategies across Tranditionals, Transitionals, and Transformationals.  Again, don't over-complicate this stuff, keep it simple, learn, and adapt.


Ok, time for your thoughts.  Use the comments section, send me a tweet (@minethatdata), or send me an email message.

Diagnosing Business Issues Via The 3Ts

The three T's (Traditionals, Transitionals, and Transformationals) help us understand how (or if) our business is evolving and changing.


Here's an example.  A business leader suggests that a customer shift from traditional channels to the web is costing him business.  Well, there may be truth to that, but at least we can measure how customers are truly migrating.  We'll run a query, watching how customers in the 3Ts migrate (Traditional = Mail/Phone, Transitionals = Web/Email/Search/Affiliates/Banners, Transformationals = Mobile/Social).

Ok, there's a few things we have to digest here.

1. Between last year and this year, customer counts across all segments are in decline.
2. Transitionals (primarily the online channel) actually repurchase at a higher rate than Traditionals.
3. Traditionals are not migrating to Transitionals at high rates, and if they were, the data suggests that this would be a good thing, because repurchase rates actually increase.
4. Transitionals are not migrating at high rates to Transformationals.  In other words, new channels are not capturing customer mindshare.
5. Even when this brand generates Transformational purchases, these customers head back to the Transitional segment, suggesting that the experience in the Transformational realm isn't satisfactory.
6. Customers who purchase in the Transformational realm have the highest repurchase rates, suggesting that if this brand can get customers to "stick" there, there is opportunity for heightened customer loyalty.

This is a business where customers have largely migrated from Traditional to Transitional status.  Unfortunately, customers are not taking the next step, as those who migrate from Transitional to Transformational status go back to Transitional status.

Traditionals, Transitionals, Transformationals

Sometimes, we make everything way, WAY too hard, don't we?

If you really want to simplify things, do the following:

1. Any purchase via Mail, Phone, or Online via Catalog Matchback is considered a TRADITIONAL purchase.
2. Any purchase via Email, Search, Affiliates, Banners, Retargeting, and other Online Marketing techniques is considered a TRANSITIONAL purchase. 
3. Any online purchase not attributed to any marketing, any Mobile purchase, and any Social purchase is considered a TRANSFORMATIONAL purchase.
4. Weight historical purchases ... purchases 0-12 months ago = 1.00 * Demand ... purchases 13-24 months ago = 0.50 * Demand ... purchases 25-36 months ago = 0.25 * Demand ... purchases 37+ months ago = 0.125 * Demand.
5. Multiply all historical orders by Weighted Demand.
6. The segment (traditional, transitional, transformational) that holds the most weighted historical demand is the segment that the customer is classified in.

At this point, every customer is placed into one of three segments (traditionals, transitionals, transformationals).  Now, dump this segmentation outcome into your email campaign results, your web analytics platform, and your catalog matchback algorithm.  Measure (or, as they say on Twitter, #measure) campaign performance against each customer segment.

Be prepared to be dazzled!