March 10, 2014

The Omnichannel Circus

If you're a cataloger in New England, you're about to hop in the car and head to Boston for the NEMOA spring conference (click here). You're excited to learn all about "The Omnichannel Circus", this year's theme.

What differences do you observe?

You know, I don't hear a lot of Forever 21 customers saying "I wish Forever 21 had a series of omnichannel solutions that turned stores into virtual digital warehouses that could ship product to my house within 24-48 hours, and I really wish they mailed me a 140 page catalog twenty-six times a year, because I love the integrated shopping experience that combines a catalog and a mobile device."

And I don't hear a lot of catalog experts saying "I wish Orvis had a vibrant community website that I could access on my Samsung Galaxy Note III Phone so I could vote up/down new product ideas and discuss Orvis merchandise with other Orvis fanatics".

There are three movements worth paying attention to.

The first movement is sold to us folks who depend upon Judy - and when you go to NEMOA, look around the room - half of the audience will represent vendors/suppliers who depend on catalogers to harvest profit from Judy before she retires.

As Judy's behavior changes, vendors/catalogers try to adapt. Judy uses a tablet, I get it, she loves playing Candy Crush. That doesn't mean that Judy wants to transact via a tablet, and it sure doesn't mean that she wants to thumb through a virtual catalog on a tablet. Judy loves catalogs. She even transacts over the phone. It is not uncommon for New England centric catalogers to generate 30% or more of transactions via the telephone.

Most of what you will hear at NEMOA this week centers around how to adapt (#omnichannel) to the changing behaviors of a 61 year old customer.

There's another component to the "Judy Movement". Many catalogers strongly believe that when Jennifer get to the year 2025 or 2030, she'll exhibit behaviors similar to Judy, leaving catalogers in a strong position to become the "go-to" source for customers nearing retirement. This is a theory, of course. Do you get in the car and shop at Montgomery Wards, or Gimbels, or Mervyns, or Kresges - do you still buy from a 600 page Spiegel catalog? Each generation seems to have preferences. Think of Amazon, for instance.

Speaking of Amazon, the second movement involves Jennifer.

By and large, catalogers hate Jennifer. When I presented at NEMOA two years ago, and I introduced her persona, there was an audible, unsatisfied groan. "We don't want to market to her, all she cares about is free shipping and low prices" is what one Catalog Executive said to me about Jennifer, after my session ended.

Do you realize that Amazon will pass $100,000,000,000 (yes, billion) in annual sales, soon? I had a smart catalog Executive leave a comment on my blog, suggesting that without catalogs, it is not possible to build a large direct marketing business. To which I responded, "how do you explain Amazon"? I should have added eBay, Newegg,, Groupon,,, Nasty Gal, zulily,,, One Kings Lane, eBags, Vistaprint,, Gilt Groupe, Blue Nile, RueLaLa, and countless others! I'm not sure why we choose to ignore facts that are right in front of us, in plain sight. Jennifer chooses different brands than Judy chooses.

By ignoring Jennifer, we cut off the bottom of our demographic profile. This makes Judy look appealing to the co-ops - to the point where the co-ops only offered us customers like Judy (go take a look at a demographic report from your favorite co-op for proof). The feedback loop isn't going to turn out well.

The third movement surrounds Jasmine.

Catalogers love Jasmine. When I spoke at NEMOA two years ago, the audience lit up when her persona was introduced! Jasmine, of course, is the generation of children of Baby Boomers, so it makes perfect sense that long-time catalog veterans might embrace Jasmine.

There's a bit of a problem, however, with Jasmine, as it relates to "The Omnichannel Circus".

When you hear folks talk about Omnichannel, you're really hearing about ideas that bridge Judy and Jennifer. The ideas that bridge Jennifer and Jasmine are not omnichannel in any way we're familiar with (though maybe the ideas are a fair representation of what omnichannel might truly become, if it becomes a valid concept). I find, repeatedly, that businesses leaders who cater to Judy have a very hard time marketing to Jasmine - they love Jasmine, but they don't know how to market to Jasmine. They apply tactics to Jasmine, and the tactics usually fail without a cohesive story that speaks to Jasmine, and more importantly, the tactics fail miserably without merchandise that is relevant to Jasmine. It is terribly, terribly hard to execute an omnichannel strategy selling Judy-centric merchandise to anybody but Judy. Omnichannel fails miserably if the merchandise isn't aligned with Jasmine. Nobody seems to want to talk about this. 

It's time to talk about this.

One member of Jasmine's generation recently told me, "if something is important, it will find me". She's not talking about a catalog finding her in the mailbox. She was talking about the products she purchases, and how she finds out about them (word of mouth). Take a few moments, and look at the apps that sell on Apple's App Store. These things come from out of nowhere, with no traditional marketing (marketing that Judy or NEMOA attendees would recognize). The viral "growth hacking" structure of Jasmine-centric marketing and community building is completely foreign to most catalogers.

When you attend your favorite session at NEMOA this week, separate the tactics you hear (which will work to some extent in the short-term) from the strategy you must employ.
  1. Who is your customer?
  2. Do you offer merchandise that appeals to your customer?
  3. Given that your target customer wants to buy your merchandise, how might you sell the merchandise to your customer?
You'll find that the 1/2/3 framework above is much less complicated than omnichannel is, and much more profitable.

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