A Post-Tropical Cyclone

A tropical system doesn't stay a tropical system forever. Take Milton for instance. A Category 5 hurricane at two different periods earlier this week, the storm slammed into Florida, was shredded apart by land, then emerged in the Atlantic as a post tropical cyclone.

In other words, the storm is transformed by a traumatic event ... sure, we as humans experience a hurricane as a traumatic event, but the hurricane also experiences a traumatic event. Without boiling hot ocean water to fuel it, the storm transforms from a storm of tropical characteristics to a garden-variety low pressure system (or becomes even less than that).

So it is with catalog brands.

A catalog brand experiences a traumatic event (decreased co-op performance ... then the paper catastrophe of 2021 followed by printers firing catalogers in 2022 and the erratic USPS) ... resulting in the end of the brand as a catalog brand ... but it does not mean it is the end of the brand. The brand is transformed ... "post-tropical" if you will.

Milton is still out there in the Atlantic. It's different now, shredded apart by Florida.

Orvis is still out there in New England. It's different now, shredded apart by market forces. They get to take full advantage of their new status ... post-catalog if you will.

Similarly, you get to take full advantage of your new status when the time comes. And it is most certainly coming. Celebrate it. Look back and be proud of what you've accomplished ... then get busy in your "post" world.

End of the Line for the Orvis Catalog

When a traditional catalog brand makes changes, I get a head's up via blog / email subscriber metrics.

1. Blog unsubscribes happen from the company as much as a month before a decision is made, because some employees no longer have a need for the content I produce.
2. LinkedIn requests for connections happen close to the implementation date of the decision.
3. Email addresses bounce as the decision is made.

So, yeah, I knew something was up at Orvis (click here for the news, sent to us by a long-time reader). And yes, close to 20% of my catalog-centric email subscribers have disappeared in the past eighteen months (offset by new e-commerce brand subscribers, of course).

As a CEO tells me, "there is no catalog industry".

Brands go though a fascinating transition when the catalog disappears:

Reactivation:  Customers with recency between 13 and 60 months are impacted, especially Baby Boomer customers. When you take print away from these customers, sales decrease and reactivation rates decrease. In many ways, you are discontinuing the brand to customers age 65-79, it's not dissimilar to going out of business to this audience. Here, the impact will be significant. This crowd can be loud and angry about the topic, in ways not dissimilar to supporting a candidate for political office.

Community:  If your marketing team is smart, they laid the foundation for this transition. The marketing team shifts the marketing message from "one-to-many" (print) to "many-to-many" (community). Your marketing team will have a strong video presence (YouTube), they will have a strong community platform that allows customers to interact with each other and with employees, they will have a personalized email marketing program (especially from a merchandising standpoint), they will have a customer development program to migrate customers from Struggling/Average productivity to Loyal/Elite productivity. They will have experts that customers trust, those experts become the voice of the brand. It's a complete overhaul of the focus of the marketing team from broadcasting to interacting. If this overhaul doesn't happen two years before the catalog is discontinued ... woo-boy, you've got a fun two years coming at you.

Merchandise:  The transition here catches my clients off-guard. When the catalog disappears, the 60-79 year old customer disappears, which means the products that a 60-79 year old customer purchase start to fail. Meanwhile, customers age 30-59 are largely not impacted by the change ... they keep buying what they've always purchased. If a merchandising team does not have proper reporting to thoroughly measure this transition, there are all sorts of problems ... inventory management gets screwed up in these situations, resulting in discounts/promotions and a pollution of the remaining customer file (they're tainted by being trained to expect lower prices).

All of these issues await Orvis.

Interestingly ... a quick Google search showed how the world is changing. Look at the brand selling Orvis merchandise in the image below. Time change.

CanJam

A few weeks back I attended my first-ever CanJam ... a headphone conference.

Yeah. I'm a nerd.

Not surprisingly, the folks at Headphones.com were everywhere. They sponsored the event, they had a booth where you could try exotic headphones or the headphones they sold. You could interact with their staff (blue shirts above) ... the very people who lead their popular Noise Floor podcast / weekly video program on YouTube. Their hosts (you'd likely call 'em "influencers") led well-attended sessions about the science of the ear and impact on what you hear with your headphones.

I heard a headphone / amp combination (Meze Empyrian II ... available for just under $3,000 on Headphones.com ... paired with a $2,000 Ferrum Oor Desktop Headphone Amp) that, as I told my wife, was "like having God reach down and touch you in the brain".

The best voice I heard in a headphone? The ancient Sennheiser HD600 for just $349. Bonnie Raitt sounded like she was in my living room.

Conference organizers were expecting a comparable or larger crowd than the 2,500 who attended the two-day event in Irvine last year.

If you are in the Dallas area the first weekend in November, head over to the event.

I am not being paid to say this.

I am encouraging you, the humble business professional, to do "something". So many of you are telling me it is too hard to find new customers in 2024. Of course it is. This is where hard work comes in.

What stops you, especially if you are a $5,000,000 to $95,000,000 business, from creating your version of CanJam? Seriously, what stops you? If you sell widgets, spend a year building out a media division, become "the" community for widgets online, then bring together the widget community with your own events ... in person, online, I could care less ... do something! If you sell collectibles or gifts, be THE place on the internet people come to learn about collectables or gifts.

As I write this, I'm watching "You've Got Mail" ... a nearly 30 year old movie about the death of a local bookstore, run out of business by the big/bad Fox Books and their low-priced store across the street. I'll bet "The Shop Around The Corner" had a very difficult time acquiring customers before succumbing to Fox Books (who would have eventually succumbed to Amazon, and so goes capitalism). The Shop Around The Corner failed ... but all across America independent book stores somehow got through the transition. They built a community, and what they sold catered to their community. Don't compete against Amazon. Create your own market.

I mean, 70% of people who own headphones own an Apple pair or Bose Noise Cancelling headphones or Beats (also Apple). In the face of such steep competition, how in the heck is CanJam generating record attendance? How in the heck does Headphones.com stay in business when you can buy from Amazon tonight and have your new iems tomorrow ... the same ones you'd get on Headphones.com?

I spent much of tonight listening to my new Meze Alba iems. The only reason I bought them is because the Headphones.com reviewers liked them, the guys hosting the Headphones.com  podcast liked them, and the community on Reddit liked them. So I gave Headphones.com $159 of my money. They created the purchase (my first purchase from Headphones.com) with hard work and a lot of indirect selling, earning a newly acquired customer in the process. They didn't pay Facebook, they didn't pay Google, and they didn't give Amazon a hefty cut of the profit. 

They created the purchase out of thin air.

You, too, are going to have to do the hard work of creating purchases out of thin air.

You've got this. Get busy!

P.S.:  How do I stay in business? I pay nobody. Nobody. I create purchases out of thin air from you, the community reading this content.

What Should An Analyst Actually Do?

Allow me to show you.

First, watch this video - it's pure interbreed dog craziness. 

https://x.com/i/status/1841956538048520557

We can break down the action into a series of images. Like this one. I've time-stamped each image for reference purposes.

We have a German Shepherd who leaves the pen, then jumps back in. Each time the German Shepherd jumps back in, one of the cream colored doxies (we'll call this pup "Sparky") tries to jump up and take a nibble out of the neck of the German Shepherd. Look at the elevation ... the extension of the back legs. Also notice that another cream colored doxie owns the observation deck.

Moving along.

Sparky is feeling a lot of joy ... Sparky already pivoted in anticipation of another chase.

In fact, three doxies are already anticipating more mayhem (above). Three seconds later (below), the German Shepherd has left the pen!

Sparky goes vertical, a little early if you ask me.

Again, Sparky excels at pivoting in mid-air. There's a lot of raw athleticism on display. Also, there will be a day eight years from now where a vet will say "Sparky has three bulging discs, do you know why?" and the owner will say, "no, I have no idea why".

Within the matter of one second, and for reasons unknown to anybody, one of the doxies decides that deck doxie needs to get lit up.

So yeah, deck doxie is about to get lit up. As you can see from the time stamps this all happens within the period of one (1) second. Deck doxie is not only ready, but gets in a series of nips that the black doxie doesn't appreciate.

In pickleball, we call those "counterattacks".

Notice that it only took Sparky one full second to refocus on the German Shepherd.

It's back to live action.

Once again, notice the outstanding bodily extension Sparky exhibits on each leap.

Sparky also behaves in chaotic and unpredictable manners. Seconds later, Sparky is headed back to the deck - and is quite happy about it.

The German Shepherd senses a chance to engage with Sparky, and heads to the deck. Sparky senses an opportunity, goes for the neck, and blows out two additional discs in the exchange.

The scene ends with a winded German Shepherd guzzling water from a bacteria-laden tray of tepid water.

What have we learned?

• The German Shepherd is an instigator. Via seemingly innocent acts, the German Shepherd causes complete chaos.
• Sparky ... well ... wow. Full of vim and vigor, Sparky is entertaining in an athletically manic sort of way.
• Deck Doxie ... willing to counterattack if required. If you don't want hip nips, stay away from Deck Doxie.
• Black Colored Doxie ... unsure of role, clearly smart and unwilling to damage joints by recklessly jumping after the German Shepherd, occasionally attempts to assert control over other doxies, then acts surprised when suffering a series of hip nips.

There are other characters in this plot, but they only play a support role ... like the waiter at a restaurant in a movie.

This, dear Analysts, is your job. It's your job to dissect a chaotic situation with seemingly unlimited moving parts, assign value to the individual players, and then communicate clearly enough that anybody following the plot can ... follow the plot. I mean, if you don't watch the video clearly enough, you'd never know that deck doxie is a hip nipper ... you'd come to the conclusion that deck doxie is just a distant observer.

Get busy breaking down chaotic scenes with many moving parts ... it's fun!

P.S.:  This also applies to Executive Leadership. It's your job to break down a chaotic and complicated business into individual parts that can be acted upon for the benefit of the p&l. Right?

Project Opportunity

Ok, you've read all about reactivation ... and scoring your customer base to know which customers you should be targeting. You've clicked on the images, you've paid attention, you've sent email messages.

Now, loyal readers get a new project opportunity.

My "Playbook" methodology is now available!! As with all new projects, I give loyal readers first chance to use the methodology at a discounted rate (so that I can test my programming code).

Normal Cost:  $24,900.

Your Price (Through The End of the Week):  $12,900.

Click on the image below for a sampling of details. Contact me (kevinh@minethatdata.com) to get your project booked ... I have openings for November, saved for you, knowing this was coming.

Fan Fiction

I recall the late Don Libey telling me about his enjoyment of Sherlock Holmes ... he wrote fan fiction, bought barrels of wine, bottled them in Sherlock Holmes themes, and drank them among like-minded individuals or sold them. Fan fiction as a hobby can be downright enjoyable.

You've heard about people who write their own Seinfeld Script ... Kramer becomes a Presidential Debate moderator, George damages Jerry's car while pursuing his side hustle as a Lyft driver, Elaine dates a YouTube influencer with an inconvenient secret, and Jerry is obsessed with an air fryer. There, see how easy that was? Also, it was terrible.

As I write this, the NFL postgame show on Amazon Prime is sponsored by JCPenney. I can return my Amazon purchase at a Staples store or at Kohl's ... both stores will give me a coupon for a discount if I buy something in the store (but won't give the same coupon to somebody who randomly enters either store because of brand loyalty). How much fan fiction do you have to write to think that giving money to Amazon or being paid by Amazon to process returns is smart for the long-term hopes and dreams of your brand?

I just spent a month telling you how to think about reactivating customers. On Monday, I'll tell you what a project might look like, and I'll give you an opportunity to pay less to break-in my code. Are you going to do the hard work required to reactivate customers, or are you going to download a white paper about eight discounting strategies for Black Friday? The latter is fan fiction.

Dashboarding New Customers by Week

Each week, you acquire new customers. Count the number of new customers by segment.

• Elite = 0 Customers (0%)
• Loyal = 1 Customer (< 0.1%)
• Quality = 16 Customers (< 0.1%)
• Average = 5,006 Customers (25.5%)
• Struggling = 14,573 Customers (74.4%)

Remember, Struggling customers have an annual rebuy rate < 20%. If 74.4% of your new customers have virtually no chance of buying again in the next year, your marketing team and your merchandise team (it's both) are doing something wrong. Something really, really wrong.

You can report on this metric weekly - keep track of how your Average/Struggling ratios change over time. You might see gains (more Average customers), you might see dumpster fires like what we see here.

This should be on your customer dashboard, and you should be measuring it every week.