September 29, 2016

Catalog Rant

Ok my friends, I'm going to blow off some steam here. I feel like the young lady below.

Here's the 411.

I order an item from a catalog brand within a Catalog Holding Company. As you remember, a Catalog Holding Company is a brand that owns 3+ catalog companies. This Catalog Holding Company is one that the 40% of our catalog-centric audience absolutely adores. Conferences and Trade Journalists and Vendors love this Catalog Holding Company. Many of you have purchased from this company. You probably know somebody who works for the Catalog Holding Company.

I ordered the item on August 9.

The item was "not available", but was backordered and would be available in early September.

Amazon has comparable items that are available via Prime and are cheaper and could be delivered to my remote rural home within 48 hours.

But I defended the industry. It's hard to help an industry if you choose Amazon, right? I paid more, and I elected to wait a long time for the item to be available.

On September 7, I receive an email (#automation) telling me that my item shipped.

The item will arrive in 5 to 9 business days.

Wait. What?

Five business days pass. 

My wife says "where's the item?". I get crabby ... "THEY SAID IT WOULD TAKE 5 TO 9 BUSINESS DAYS, LET'S GIVE THEM 9 BUSINESS DAYS!!!!". Think about this ... I'm getting crabby with my wife, who is on my side ... and I am defending a Catalog Holding Company.

Ten business days pass. 

Fourteen business days pass.

I decide that it might be a good idea to call the Catalog Holding Company. I check the tracking number. FedEx says that SHIPPING INFORMATION WAS SENT TO FEDEX ON AUGUST 31. That's it. No shipment, no receipt of product, nothing.

I visit the website of the Brand owned by the Catalog Holding Company.

No live chat.

I know, I know, live chat has been around since the Bush Administration. But I don't want to be one of those preachy social media customer experience gurus who spends all day pointing out what companies do wrong in exchange for 100,000 #engaged followers.

I call the 1-800 number of the Catalog Holding Company.

The voice on the other end is bathed in silence ... the kind of silence that suggests she is sitting in her living room watching ESPN or Kitchen Nightmares. I provide my order number. She tells me, and I quote ... "MY INTERNET ISN'T WORKING PROPERLY, SO I CANNOT PULL UP YOUR ORDER NUMBER RIGHT NOW".


A minute passes.


She reads me the tracking number.

I already know the tracking number! I've been tracking nothing for fourteen business days.

I ask the person on the other end of the phone to look at the status of the item.


I tell her "I agree"!!!


I tell her that I've waited 14 business days.





She hung up on me!

I go back to the website, and I type a message to customer service. I use up my 200 characters (or whatever the quantity was) pretty fast. I describe that I haven't received my item, that the tracking number shows that no item has been shipped, and that the customer service rep had internet problems and then hung up on me.

That was three business days ago.

No response from the Catalog Holding Company.

The Catalog Holding Company has had my $90.94 since September 7. Good for them.


Here's one of the comments I frequently get from CEOs and VPs at catalog brands.
  • "It's just too hard to compete against Amazon, sales declines are not our fault."

Sales declines are ENTIRELY our fault!!!! We either failed to be strategic, or we failed to execute properly. Or both.

On what planet should a customer sit for two months waiting for an item to ship when Amazon can flawlessly deliver an item in a few hours in an urban environment and within 48 hours in a rural environment?

Meanwhile, the Catalog Holding Company is going to distribute my $90 to vendors ... because most catalogers measure demand, not net sales ... meaning catalogs are about to be unleashed upon the Hillstrom household regardless of customer service failures.
  • The paper rep will be happy.
  • The printer will be happy.
  • The USPS will be happy.
  • The merge/purge vendor will be happy.
  • Co-op vendors will be happy.
  • I'm not happy.
The Catalog Holding Company will not get paid. I will eventually obtain my refund.

Friends, I am tired. I get feedback from you ... "please demonstrate that you are on our side - prove to us that you love the catalog industry and are trying to help us".

It's hard to be on the side of an industry that is on the wrong side of the customer experience.

Why does it take 5-9 business days to ship an item, dear Catalog Holding Company?

Why did you fail to execute delivery of the order, dear Catalog Holding Company?

Why did your customer service rep not have reliable internet access, dear Catalog Holding Company?

Why did your customer service rep hang up on me, dear Catalog Holding Company?

Why don't you have live chat, dear Catalog Holding Company?

Why don't you respond to customers who respond with a customer service request on your website, dear Catalog Holding Company?

Why did you take my money but never deliver my item, dear Catalog Holding Company?

Why do you complain, dear Catalog Holding Company, that Amazon is wiping out your business?

I try to stay away from this stuff - but these errors are magnified when Amazon executes so well. And how I can I help you in our consulting projects when I tell you how to market to the customer only to have the customer service experience fail the marketing experience?

Thoughts? Send them along at


September 28, 2016

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Merchandise Development

Can we agree that in baseball, the players are "the merchandise"? That's what we are paying to see, right?

Did the players on the field just show up there, unannounced? Or was there a development process the players went through?

A baseball star plays in High School. From there, the player might play in College, or be drafted and begin a professional career in a Rookie League. If the player does well, the player moves on to Low-A. If the player does well, the player moves to High-A. If the player does well, the player moves up to Double-A. If the player does well, the player moves up to Triple-A. If the player does well, the player is called-up in September (or when there is an injury). And if the player does well, the player becomes a Major League Baseball Player!!

In other words, in Sports, there is a clear development system for players (merchandise).

Tell me what your development process is for new merchandise you launch?

You don't have a development process? You just provide a few links on your website and/or a "new products" link and then hope for the best?

In the future, retail and e-commerce will become much more like professional sports. There will be a development process for new merchandise - almost like a tournament - with email and social and key landing pages weeding out the merchandise that works from the merchandise that doesn't work. The new merchandise that works is promoted to expensive offline/digital advertising, saving the retail / e-commerce brand a ton of money.

September 27, 2016


In sports, practice is terribly important. Baseball players take "batting practice" before games. Football players practice all week before playing a weekend game.

NASCAR drivers hop in a simulator (so do Formula One drivers). The simulator prepares the driver for things that may happen on the track.

Seattle Seahawks fans know all about the intensity that Russell Wilson brings to preparation. In college at Wisconsin, he once played a video game so that he could see where the play clocks were located at Spartan Stadium in East Lansing. That sure came in handy when he rallied his team to a late-game touchdown.

So in the sports industry, practice is a critical element of success.

How do you, the retail and/or e-commerce professional, earn simulation time or practice time?

Do you have a simulator so that you can understand what happens when you double the paid search budget? How about when you close a store? Do you simulate what might happen before you spend tens of millions of dollars on omnichannel digital systems integration? Do you simulate not participating in Cyber Monday promotions? Do you simulate what happens when you don't open your store at 8:00pm on Thanksgiving evening?


Why not?

Show of hands ... how many of you have a favorite vendor partner who sells a simulator that allows you to try a hundred unique strategies to see how the strategies might interact with each other - so that you can figure out if you are making a smart decision before you just go out there with 35% off plus free shipping?

Retail and e-commerce must become more like professional sports. If the analytics community resents a "gut feel" approach to Management, then the analytics community should create a simulation environment that allows Management to practice different strategies.

September 26, 2016

Lands' End #sigh

I don't like it when people are fired or "resign" - as we observed earlier today at Lands' End (click here). I don't like it when Macy's goes through a sales decline & folks lose jobs. I don't like it when the public jumps on people who take risks ... if you don't innovate, you are criticized, if you innovate and it doesn't work, you are criticized.

I have a soft spot for the company - as I do for every company I've worked at. And there are too many good, solid people who work there. Hopefully, they pick a path forward that is right for their business, and their business will improve - just as I hope your business gets even better.

Look to JCP as an example - their sales crumbled 30% - then they changed course and sales grew at inflationary rates going forward - sales did not bounce back. It's hard to grow, regardless whether you have the right/wrong strategy. It's hard work.

Thanksgiving and Christmas

In sports, promotions are frequently assigned at the start of the year. June 19th is "Bobblehead Day" ... September 9 is "Bark at the Park Day". The promotions offer something on top of the price the customer pays to attend the game. And some teams leverage "dynamic pricing", so that the games that are most popular have the most expensive prices. Want to attend the game when your team is about to win the pennant, and it's a few days before the game will be played? You're going to pay.

In e-commerce and retail, we do the exact opposite.

Think about Thanksgiving and Christmas. "Black Friday" comes to mind. It's the biggest "game" of the year in retail. Does retail charge you the most on that day, comparable to a sports team? Not even close. Retail makes darn sure that retail will make the least amount of profit possible by offering every conceivable discount and promotion under the sun. I know, I know, you'll say that the customer won't shop if you don't offer the promotion. But why does the sports fan happily spend more to go to the games that are most important, including playoff games and championship events?

E-commerce is no better. Think about Cyber Monday. Are you able to charge the customer the most for this big Thanksgiving/Christmas shopping event? No? Your favorite vendor or trade journalist demands that you offer huge discounts? Yes!

In the future, retail and e-commerce are going to have to become more like professional sports franchises. Today, during the biggest events, we ask customers to spend less (#doorbusters) ... the bigger the event, the less we ask the customer to pay. In sports, we ask "fans" to spend more ... the bigger the event, the more we ask the fan to pay.

Is it any wonder that the NFL / NBA / MLB are swimming in money, while retailers fight for their existence?

Of course, this means that retail and e-commerce must create events that cause customers to want to spend more. We're not good at this, are we?

September 25, 2016

Customer Spend

Let's take some time this week to compare and contrast how the sports industry monetizes their audience, and how we in e-commerce / retail monetize our audience.

If you purchase season tickets to see the Seattle Mariners, you may well earn a discount ... but you are also encouraged via the discount to purchase more expensive seats, which really isn't a discount because you're watching the same game everybody else is watching.

Sports teams get your money in advance. You may or may not (look behind home plate at a Yankees game sometime) attend the game, but you paid for your ticket ... usually an above-average cost ticket.

In e-commerce and retail, we tend to do the opposite, don't we? It's late September and we throw a discount/promotion at our best customers (#crm), hoping the customer will spend more. In fact, most of the best practices in the industry involve getting a best customer to purchase again via discount/promotion. Then we throw a loyalty program on top of the existing incentive structure, paying the customer points that are used to cause the customer to spend even less in the future.

Amazon, of course, acts more like a sports team. They get you to pre-pay for shipping on an annual basis.

If we want to win in the future, we're going to have to treat our businesses more like a sports franchise. There will have to be events that the customer has to participate in, events that cause the customer to spend more. We currently do the opposite - we practically beg the customer to spend less, and we dilute events by running promotions nearly every week.

September 24, 2016

An September Attribution Conversation With Catalog Craig Paperman

Yes, this is considered "Business Fiction" ... if this isn't your cup of tea, then why not read about these 8 easy tips to make your retail business perform better (hint - they're easy to implement and they won't make much of a difference - unless you think that having employees park cars in front of the store causes folks to think the store is performing well - and make sure to read the response to a commenter who asks an honest question about how to fix his retail business).

Kevin: Craig, you look crabby today.

Craig: You always think I look crabby. Idiot.

Kevin: Why do think I am an idiot?

Craig: Never mind.

Kevin: No, if you are going to take pot shots at me, at least have the courtesy to man-up and share why you think I am an idiot.

Craig: You are an attribution idiot.

Kevin: That's why you think I am an idiot?

Craig: Among other things.

Kevin: What don't you like about my point of view on attribution?

Craig: I'll tell you what I don't like.

Kevin: Get on with it!

Craig: Fine. You have no idea how to attribute orders to customers. No idea at all.

Kevin: Do you have a clear picture on what you need to do, from an attribution standpoint?

Craig: If we don't send catalogs, nothing else happens. The catalog is the catalyst for the whole process.

Kevin: I disagree with you.

Craig: That's why you are an idiot.

Kevin: I just got off the phone with an e-commerce startup. They told me that Instagram is the catalyst for their whole process. Their creative team generates beautiful imagery that customers cannot help but share, creating a whole bunch of free marketing for their brand. You don't need a catalog to make magic happen.

Craig: And my catalog is full of beautiful imagery that customers cannot help but purchase from.

Kevin: Do you see the problem?

Craig: Do you?

Kevin: The problem is that you have to pay a ton of third parties for the right to get your images in the mail. The online brand doesn't have to do that. And then you spend all of your time trying to parse orders across vendors. Maybe you should focus your efforts on having a robust customer acquisition program.

Craig: That's why attribution is so important. We have to prove that our investment works.

Kevin: Think about what you are saying.

Craig: Oh, I've thought about it. I can't stop thinking about it.

Kevin: In order to put that catalog in the mail, who do you have to pay?

Craig: An awful lot of people!

Kevin: Paper reps. Your printer. The USPS. Your merge/purge provider. Your co-op - heck, four or more co-ops.

Craig: Because I spend so much money, I need to prove that there is a return on investment.

Kevin: Who is telling you that you need to prove there is a return on investment?

Craig: Who?

Kevin: Is your staff telling you to prove there is a return on investment?

Craig: No.

Kevin: Then who? Who is telling you to prove that there is a return on investment?

Craig: Our co-op rep said that attribution is really important.

Kevin: Why would your co-op rep tell you that?

Craig: Because she's trying to help us. She gives us a lot of free tips. She told us that #engagement is really important, too. She sent me a link to a blog post called "Six Reasons Why Engagement Is A Game Changer."

Kevin: She wants to help you so that she can "prove" that catalog marketing works. You know why?

Craig: No.

Kevin: Because if she "proves" that catalog marketing works, she gets paid.

Craig: By who?

Kevin: By you!!

Craig: Oh.

Kevin: Have you ever noticed that the loudest voices in the attribution discussion are the voices that you have to pay to get catalogs put in the mail?

Craig: Um.

Kevin: What do your attribution "partners" tell you to do when a customer receives a catalog and then comes to your site via paid search and then purchases via a discount in an email campaign?

Craig: Well, you match the customer back to the catalog, and if the customer was mailed a catalog, you give the catalog credit.

Kevin: Why does the catalog get credit?

Craig: Because the catalog inspired the order. How else did the customer get to the website?

Kevin: But how do you know the catalog inspired the order?

Craig: Because the catalog came first!

Kevin: In my example, email was part of the purchase process, right?

Craig: Yes.

Kevin: So who is to say that email didn't initiate the process?

Craig: Nah, email is a pointless distraction compared to "the catalog".

Kevin: And how do you know the customer wasn't searching for products for months?

Craig: Because Google Analytics makes it really hard for me to observe that kind of behavior.

Kevin: So you make assumptions because a third-party provider makes it hard for you to measure the whole chain of events leading up to a purchase?

Craig: Google Analytics is free.

Kevin: Maybe you should pay them, or pay Adobe so that you have a more complete view of customer behavior.

Craig: See, this is why you are an idiot.

Kevin: I'm an idiot because you want to prove that the catalog works because your vendors want catalogs to work so that vendors continue to get paid by you?

Craig: You are an idiot because you don't look at the business the way you are supposed to look at the business.

Kevin: How am I supposed to look at the business?

Craig: You are supposed to mail a catalog. The catalog creates a whole stream of #engagement, which I am more than happy to pay for. Then, the customer orders online. Finally, we apply #datascience to parse orders across the marketing channels that contributed to the order, with the catalog getting most of the credit because the catalog kick-started the process. Then all of our vendors get paid, and we hope to make profit in the process. The entire industry is happy. That's how you are supposed to look at the business.

Kevin: And who told you to look at the business that way?

Craig: Nobody. That's the way it is supposed to be.

Kevin: You listened to those with a megaphone. Who holds the megaphone?

Craig: Again, you are an idiot.

Kevin: The vendors you pay hold the megaphone. They pay trade journalists to get their message to you. Their sales reps tell you what to do. The vendors sponsor all of the major conferences, and their sponsorship dollars allow them to use a megaphone to tell you what to do.

Craig: My vendor partners wouldn't lead me astray.

Kevin: How old is your customer?

Craig: We just had a 32 year old purchase from us! Our database provider overlayed demographic and social data to demonstrate that we have younger customers. Our database provider wants to prove we have younger customers who might be willing to capitalize on their retargeting product.

Kevin: How old is your average customer?

Craig: Sixty-three years old.

Kevin: That's what happens when you look at the business the way you are supposed to look at the business.

Craig: Here we go with the age nonsense and catalogs mailings again.

Kevin: Craig, you aren't even trying.

Craig: Of course I'm trying!

Kevin: You want to know how to solve the attribution riddle. But the riddle you are trying to solve is biased because you want the catalog to get most of the credit. The outcome of your approach to attribution is an aging customer base that is disconnected from modern commerce. And anytime I point this out to you, you call me an idiot.

Craig: You are an idiot because you aren't doing things the way you are supposed to do them.

Kevin: But by doing things the way you are supposed to do them, your vendors are being paid but your business is struggling.

Craig: So help me solve the problem, but help me solve it by doing things the way we are supposed to do them!

Kevin: Let me ask you a question.

Craig: Oh Christ, here we go.

Kevin: Have you ever gone to a restaurant and enjoyed really good soup?

Craig: Why would I eat soup at a restaurant?

Kevin: #OhBoy.

Craig: I mean, if you are going to go to a restaurant, why not enjoy a Prime Rib? I'm thinking thirty free range ounces of heavily salted and peppered medium-rare perfection, with au jus and creamy horseradish sauce and roasted vegetables. Doesn't that sound good?

Kevin: Make sure your co-op rep takes you out to dinner.

Craig: That's what you eat at a restaurant. Prime. Rib.

Kevin: Which portion of the meal that you described do you attribute the success of the meal to?

Craig: What?

Kevin: Do you enjoy the Prime Rib meal because of the roasted vegetables? The salt? Creamy Horseradish?

Craig: It's the whole thing. It's how it all fits together. It's perfect! And the service. I like it when Wanda serves our table. Wanda is funny. She tells great stories.

Kevin: I'll bet Wanda works for tips.

Craig: You can't separate anything from the experience. It all fits together, resulting in a great meal.

Kevin: So you don't attribute 60% of the success of the meal to free range beef, and 15% to Wanda, and 10% to the vegetables, and 10% to salt-and-pepper, and 5% to creamy horseradish and au jus?

Craig: Who would ever do that? An idiot, probably.

Kevin: Don't you want to be able to attribute the success of the meal properly? You made a $49 investment in the meal, don't you want to know why your investment worked or didn't work?

Craig: No, I just want a great experience.

Kevin: They why not approach your customer acquisition activities the same way? Why not create a great experience via a combination of marketing and merchandising and customer service and creative? Then evaluate the whole package. Is the whole package working, or is the whole package not working? Use your customer acquisition ad-to-sales ratio to measure overall effectiveness. Test mailing catalogs or not mailing catalogs. Test increasing the paid search budget or reducing the paid search budget, and see what happens to new customer counts. Try managing a true customer acquisition program, and measure the overall effectiveness of your program.

Craig: I don't want to do that. I want to do things the way you are supposed to do them. Now please tell me how to attribute orders to the catalog, so that I can #optimize my catalog investment.

Kevin: #OhBoy. 

September 22, 2016

Opposing Metrics

This one comes up all the time.

Let me give you an example. A company increases marketing spend - significantly. This is where things get interesting.

Last Month (Ad Cost = $2,000,000):
  • Catalog Marketing = $5,000,000.
  • Paid Search = $1,000,000.
  • Facebook = $500,000.
  • Email = $1,000,000.
  • Other Online Marketing = $1,000,000.
  • Non-Attributed Online Sales = $4,000,000.
  • Total Volume = $12,500,000.
This Month (Ad Cost = 30% More ... $2,600,000).
  • Catalog Marketing = $6,000,000.
  • Paid Search = $1,200,000.
  • Facebook = $600,000.
  • Email = $1,200,000.
  • Other Online Marketing = $1,200,000.
  • Non-Attributed Online Sales = $3,000,000.
  • Total Volume = $13,200,000.
Your CFO wants you fired. She put together her own math.
  • You Spent $600,000 Incremental Ad Dollars.
  • You Generated $700,000 Incremental Demand.
  • You Lost $320,000.
You analyzed the gain in demand by marketing channel.
  • You Spent $600,000 Incremental Ad Dollars.
  • Marketing Channels Increased By $1,700,000.
  • You Generated $80,000 Profit.
Who is right? The CFO? Or you, the Marketer?

90% of the reading audience will side with the Marketer.

The profit and loss statement, however, cannot be avoided. There's a demand gain of $700,000 and an ad cost gain of $600,000 yielding a loss of $280,000.

The CFO is right.

The Marketer is wrong for the simple reason that the attribution algorithm being used by the marketer mis-attributed online sales to advertising vehicles.

Attribution algorithms are always wrong. Every single one. Wrong.

The profit and loss statement, unless your Finance Team is doing something illegal, cannot lie.

The best Marketers work closely with the Finance Team. The best Marketers pay close attention to the movement of the ad-to-sales ratio. Oh, I get it, this is a metric that became popular in the 1980s ... meanwhile, your favorite attribution vendor says they are using the latest and greatest machine learning algorithms to slice and dice customer intent. The latter sounds sexy. The former is 100% accurate.

Non-Attributed Online Sales happen because customers love your brand ... because they WANT to buy from you. No credible Marketer takes credit for orders that are generated by love of the brand.

The best Marketing professionals know how to deal with opposing metrics. The best Marketers always side with the profit and loss statement.

Thoughts? (

September 21, 2016

Which Lifetime Value Scenario Should You Pursue?

Here's the lifetime value information from yesterday:
  • Google / Paid Search: On average, you make $5.00 profit acquiring a customer via paid search, and you generate $12.00 of profit in year one and you generate $27.00 of lifetime value.
  • Facebook:  On average, you lose $10.00 acquiring a customer via Facebook, and you generate $8.00 of profit in year one and you generate $20.00 of lifetime value.
  • Offline Advertising: On average, you lose $15.00 acquiring the customer via Offline Advertising, but you generate $20.00 of profit in year one and you generate $50.00 of lifetime value.
Remember, our issue isn't having too few / too many metrics. Our issue is knowing what to do with the information available to us.

The Google / Paid Search scenario is easy. You make money acquiring the customer, you make money in year one, and you generate a healthy amount of lifetime value. In this case, you test your way into spending more on paid search - and you find out just how deep you can go down the paid search rabbit hole, right? (testing, of course, in tandem with natural search, so that you know how much paid cannibalizes natural search ... right?)

The Facebook scenario is deliciously entertaining. You lose money acquiring the customer, you generate profit in year one but not enough profit to offset what you lose acquiring the customer. In other words, after one year, Facebook customers are still unprofitable. Do you continue to pursue this source of acquisition? How did you answer?

I know how I would answer. I'd pull out my five year business investment simulation, and I'd tally corporate profit over five years with and without Facebook names. You run five year business investment simulations, right? Right? If your company has an annual retention rate of between 30% and 45%, then you need to be paid back within 12-18 months in order for the company to optimize long-term profit. That's what I see in the simulations I run. This is where you have to present scenarios to your CFO. You show your CFO what the business looks like five years from now with Facebook names and without Facebook names, and you let your CFO pick the path that aligns with Finance goals. If the business must grow top-line sales and profit isn't all that important, then you'll invest in names from Facebook. If profit is important, you'll avoid these names. But your five year business investment simulation will give you the answer you are looking for.

Look at your Offline Advertising names. You take a bath acquiring the customer, but the customers you acquire become the best customers you'll acquire. Again, this is where you have to have a five year business investment simulation. Why? Because you need to show the CFO that in the short-term, your business results will look bad, but in the long-term, you'll have a very healthy business.

Does this make sense to you?

The issue isn't whether lifetime value (LTV) is a key performance indicator you must track or not. The issue is what you do with the metric. You need a five year business investment simulation to make sense of LTV, and you need to have a good working relationship with your CFO so that you can make decisions that align with corporate goals.

What questions do you have?

September 20, 2016

Metrics Metrics METRICS!!!

2016 has been interesting for many reasons.

Here's a quote that keeps coming up.
  • "Can you please tell me the three or four KPIs that, if I track them, will help me grow my business?"
"KPI's" of course are "Key Performance Indicators".

Too many of us have been convinced that if we knew a handful of facts about customer behavior, then we could mysteriously change the trajectory of our business.

If that were true, then why can't IBM's Watson figure out metrics that help IBM reverse a four year sales decline? I mean, they have the best metrics machine on the planet ... and so what, right?

Metrics are not the issue.

Business knowledge is the issue.

We don't want to admit that we don't know what to do.

So let's try a little experiment.

Here's your quiz for tomorrow.

Let's say that there are three primary sources of new customers.
  • Google / Paid Search: On average, you make $5.00 profit acquiring a customer via paid search, and you generate $12.00 of profit in year one and you generate $27.00 of lifetime value.
  • Facebook:  On average, you lose $10.00 acquiring a customer via Facebook, and you generate $8.00 of profit in year one and you generate $20.00 of lifetime value.
  • Offline Advertising: On average, you lose $15.00 acquiring the customer via Offline Advertising, but you generate $20.00 of profit in year one and you generate $50.00 of lifetime value.
Well, you want metrics that matter - and there isn't a more important metric than lifetime value. Tell me what you, the strategic marketer/analyst, do with this information? And don't tell me you need more information!!!! Your CFO is staring at you. What do you tell her?

We will answer this question tomorrow.

September 19, 2016

Self-Driving Cars & Retail & Sports

Let's compare and contrast business models. When you go to a Milwaukee Brewers baseball game, what happens?
  • You pay the Brewers for the right to park in their parking lot.
In this version of the future, what is the author recommending for retail?
  • Retail pays you for the right to visit their store.
Can you see what is going on? One set of brands gets you to pay to visit their arena ... your brand (in theory) is going to pay the customer to visit your store. My goodness. Why do we celebrate a future where retailers constantly have to foot the bill for vendors?

Retail has to become MORE like sports in order to survive.

In other words, what good is the retail industry if it is simply a tool for monetizing a driverless car industry funded by wealthy tech gurus?

We already know the answer to that question, don't we? We've spent a decade "digitizing" retail, because wealthy tech folks told us that's what the future of retail is ... and now that we're in the future, we've learned that digitizing retail means less traffic in stores. So with less traffic in stores, the digital elite want driverless cars that retailers pay customers to ride in to visit stores.

At some point, the retail industry will stop listening to gurus ... and will instead figure out how to make retail more like sports, where customers open the wallet to soothe their emotional needs. Without this transformation, smart digital gurus will continue to take advantage of average retail minds.

September 18, 2016


In sports, it is really clear who is winning, and who is losing.

Within games, you look at the scoreboard. Oh, look, the Mariners are losing 14-1 to the Rangers. That's not good.

Then you look at the standings (baseball, basketball, football, hockey) ... in soccer, you look at the table. Those who win the most are on top, those who lose the most are on the bottom. It's easy to see who is experiencing success.

If you want to advance your career, you probably have to do two things.
  1. You probably have to go work for a company that is losing.
  2. You probably have to fix that company, and help that company win (in an ethical manner, of course).
At least that's the way it happened to me ... I had to go from a winning company to a losing company ... had to fix my area ... then went from fixing a problem to going to a company that defined losing (, and had to play my part in fixing that problem.

Oh, sure, there's a club of folks who earn well-deserved upgrades ... going from Target to Uber or something like that. But far more often, a company that is losing games by the score of 14-1 is the company that comes calling. That's where your chops are tested.

Traditional Retail and Classic Catalogers are losing, for the most part. There are exceptions as always. But you look at the standings, and these companies are not winning. This means that there are Professional opportunities for you to go into these companies and FIX THEM!

A retail brand (in particular) is going to be run much more like a sports team in the future. The in-store experience is going to be more like a sports schedule ... with numerous events and opportunities to buy tickets to big events in-stores and experiences and thrills and all that kind of stuff. Wouldn't you want to be one of the people who fix the problem? Isn't that more fun than being an #omnichannel drone that the vendor community counts on to get paid?

There are going to be a TON of opportunities to fix retail and to fix cataloging in the next five years. Are you ready to implement your program, your way of doing things? Are you ready to see if your ideas can be implemented? Are you ready to see if you can lead people?

Or are you going to point at the scoreboard and mock those that are losing 14-1, or worse, just roll out the #omnichannel vendor playbook at their benefit?

Cost Differences

Do you remember Bernie Mac in Oceans Eleven ... negotiating van prices? Muttering nonsense about Aloe Vera while squeezing the sales dude...