Looking Ahead

Those in the audience that manage catalog-centric e-commerce models ... here's an interesting one for you.

• "Brand X" has a 25% annual repurchase rate. Projecting to the start of 2024, "Brand X" will have 100,000 customers.
• Brand "X" averaged 75,000 new/reactivated buyers over the past four years. In 2024, with it being extremely hard to acquire customers via print, the brand is forecasting 40,000 new/reactivated buyers.

If this trend continues ... we can see how many customers we'll have by year.

• 2023 = 100,000 customers.
• 2024 = 100,000*0.25 + 40,000 = 65,000 customers.
• 2025 = 65,000*0.25 + 40,000 = 56,250 customers.
• 2026 = 56,250*0.25 + 40,000 = 54,063 customers.
• 2027 = 54,063*0.25 + 40,000 = 53,516 customers.

This is the forecast you need to show your paper rep, your printer, the USPS, your co-op lead. This is what they're doing. In the example above, they're cutting "Brand X" in half.

Yes, you have all these digital channels and offline non-print channels to use ... you've had them for a couple of decades for the most part. You are accountable. But your service providers are accountable as well. Show them what they're accountable for.

New Customer Acquisition Strategies ... The Story of 2024

I spend a disproportionate amount of time watching professional pickleball. An unhealthy amount to be fair.

The PPA (the most influential professional pickleball organization) aligned with Tennis Channel. Instead of publishing their content on YouTube (Google), they (the PPA), they now publish their content on their own website (https://pickleballtv.com/) and on Amazon Prime ... specifically, on Prime's Freevee service.

How exactly does an e-commerce brand compete against a pickleball channel broadcast on the biggest e-commerce competitor in history, paired with non-stop informercials about products you can purchase on Amazon? No amount of "omnichannel strategy" competes against Amazon. None.

Back in 2016 I toured the Country (and Europe) telling the audience that customer acquisition tactics were going to be the most important thing they could ever focus on. It didn't go well.

Companies in attendance back in 2016 recently asked me how to acquire customers in 2024.

That's the story of the upcoming year. Some of you have spent the past decade preparing for this day.

if you haven't spent the time preparing for today, you can be very successful. There's time. There will be top-line contraction, obviously, but there is time. Get busy! Use 2024 as an R&D year.

Cyber Monday

If I have to hear one more quote from a trade journalist suggesting that you "must win Cyber Monday".

Fools.

Do they ask you to win January 17?

Do they ask you to win February 9?

Do they ask you to win March 21?

Do they ask you to win April 3?

Do they ask you to win May 24?

Do they ask you to win June 19?

Do they ask you to win July 30?

Do they ask you to win August 20?

Do they ask you to win September 1?

Do they ask you to win October 14?

Do they ask you to win November 18?

Do they ask you to win December 13?

If the answer to those questions is "no", then stop adhering to their program. Stop listening. Stop reading.

Winning in Business is a 365 day endeavor.

Fools.

Do not execute the tactics that create clicks for trade journalists. Execute the tactics that generate profit for your business.

My goodness.

Send me sales/profit calculations (kevinh@minethatdata.com) if you feel differently.

Storm Clouds

Starters:  Read this word salad of nothingness. My industry is about out of gas. The needle is below empty.

If Amazon represents 37% of e-commerce, is it any wonder that some e-commerce brands are struggling? Do you ever stop and think about that metric? It's a whopper! Kohl's says that e-commerce is dragging them down. No kidding. You turn your stores into Amazon returns centers and you wonder why your own customers won't use your website? You told them not to! You told them to buy on Amazon and then you'll clean up the mess when the customer isn't happy with (checks notes) Amazon. It's hard to think of a bigger Management blunder ... except the industry cheers this on as an example of Omnichannel brilliance. Hint - it is the opposite of brilliance.

Of course, none of the content in the paragraph above is as bad as what vendors are doing to catalogers, who are dealing with 10% to 20% annual inflation thanks to the efforts of paper folks (constrained supply), printers (constrained supply), and the USPS (gotta make a profit). All three are conspiring, in unison, to create a "spiral to singularity". What does that mean?

• Pretend you send 500,000 catalogs.
• With 10% to 20% annual inflation thanks to your vendors, you reduce circulation to 425,000.
• Next year, with circulation reduced to 425,000, your vendors increase prices again, causing you to reduce circulation to 350,000.
• Next year, with circulation reduced to 350,000, your vendors increase prices again, causing you to reduce circulation to 275,000.
• At some point, you will mail one catalog that costs $500,000 to one productive customer. That's the spiral to singularity.

You don't need to be a wizard to see what Amazon is doing to e-commerce ... to see what vendors are doing to end cataloging (and yes - some of you will say it ended 13 years ago and that's a funny line and all that, but that doesn't mean it isn't a profitable discipline ... it just means you can tell a joke).

Storm Clouds are brewing.

2024 is the year you are required to find clever ways to find new customers ... ways that do not depend upon the forces tearing your business model apart.

Amazing Project Run Happening Right Now

I never expected 2023 to end this way. Here's a common comment the past two weeks, all from new clients.

• "Would you be willing to run your Elite Program for us off-schedule? We're seeing something really odd in November performance and we want it diagnosed."

We have catalog brands being destroyed by third parties (USPS, Paper Brands, Printers) ... we have e-commerce brands being challenged by Amazon. If you fall into either category and want me to run my Elite Program code for you off-schedule, I'll do it. For new clients, this is an $1,800 request. Contact me (kevinh@minethatdata.com) and I'll fit the run in for you, ok?

Inflection Points: Thanksgiving

The next six days offer a bounty of Inflection Points.

You have discounting information in your database. You have prior Black Friday and Cyber Monday information in your database - undoubtedly you have 1/0 indicators in your database saying whether a customer purchased on both Black Friday and Cyber Monday, right?

Right?

So why in the name of Don Libey are you sending five "blasts" to all customers offering 50% off for Black Friday and Cyber Monday? Why wouldn't these "blasts" be targeted based on the 1/0 indicators in your database? Why do you want to convert a full-priced August buyer into a Black Friday buyer at 50% off?

Why do you want to convert any full-priced buyers to 50% off fake-holiday buyers?

The next 5-6 days are full of Inflection Points. Your database should have indicators that allow you to take action on these Inflection Points.

Right?

Here We Go!

Your friends in the trade industry are ready for their Super Bowl. They want you to sell at 60% off, they want you to increase your marketing budget by 60%, and if you don't increase your sales you are an idiot. They'll write all about it. That's how they make money.

You're going to hear all sorts of comments ... hourly diagnostics ... "At 11:00am EST Black Friday is trending 3.43% below last year. Marketers need to react immediately to these trends if they want to reap the rewards of this critically important season."

Utter gibberish. All of it.

You sell the way you want, when you want. Do what is best for your business. You are under no obligation to do what an "expert" at Woodside Research tells you to do.

Two stories. The first one I've told you previously. I'm sitting in a meeting on Cyber Monday with an Executive Team. It's 8:30am. The CEO is at the head of the table. A non-descript individual walks in, whispers into the CEO's ear, then hands the CEO a small piece of paper. The room sits in silence. The CEO turns to the room, and in a graven voice says "Brand X is at 40% off for Cyber Monday. We have to remain competitive. Effective immediately, we will be at 45% off." The Marketing Executive says something along the lines of "our email blast goes out at 9:00am, we cannot react that quicky". The CEO says something like "oh yes we can", causing the Marketing Executive to head out of the conference room with hair on fire. It's moments like that that your service providers / vendors are not compensated properly. The email was delivered, at 45% off.

The second story is about a smart client of mine. I analyzed the future value of customers who purchase on specific days of the year, after controlling for the quality of the customer purchasing. Two of the worst days to generate business? Black Friday, and Cyber Monday. Customers purchasing on those two days were so much less valuable than customers buying during other times of the year that you could practically shut the website and stores down those two days and be more successful during the rest of the year. This brand chose to not discount on Black Friday and Cyber Monday. Sales still came in the door. Those sales were much, much more profitable, however.

You probably already run the query to see how valuable customers are in the next year based on the day customers purchase merchandise. You probably already know you'd rather generate an incremental order on April 27 than November 27, much less an incremental order on November 27 that is at 40% off.

If you don't run this query, send me some data and I'll run it for you for the low cost of $1,800 (kevinh@minethatdata.com). It's a Black Friday / Cyber Monday special for you!