Plow & Hearth Tree Planting Campaign

Plow & Hearth sent an e-mail communicating their efforts to plant trees. You can view the e-mail here.

Their e-mail suggests that they plant two seedlings for every tree they cut down to produce catalogs. And at http://plowandhearth.com/trees, you can monitor their efforts to reach a million seedlings in one year --- customers who order at Plow & Hearth automatically get a seedling donated with their purchase.

Sure this represents an expense for Plow & Hearth --- a wise expense, a good use of public relations marketing.

One way to quell those who believe we represent a wasteful industry is to replenish the resources we consume.

CEO Comments: September

Barnes & Noble on in-store music sales, online sales growth, and offering e-commerce exclusive items (weren't we supposed to have the exact same experience across all channels?).

PetSmart profit was down --- and there was a comment about the customer database, at least twice. Notice the comment about using the database to focus on profitable promotions, ugh.

Kenneth Cole takes a bath, will shift focus from fashion items to basics. Isn't this a classic trend that repeats (upswing = fashion, downturn = basics).

Zales drives a 6% comp store increase, but with a margin reduction, sees a huge drop in profitability. Clearance represented 20% of sales. Wow. Direct marketing and catalogs reflect the "brand position", with less density (always an interesting strategy --- less density). E-commerce is +30% for the year.

Long Island: Hillstrom's Zip Code Forensics

The Northeast United States is a direct marketing hotbed unlike any other, as validated by Hillstrom's Zip Code Forensics (read about and purchase here).

As marketers, we need to think about the differences we see in geography. This map shows outstanding performance in Manhattan, marginal performance in Queens and The Bronx.

Then we head out on Long Island, and we find a multichannel hotbed of customers who prefer both e-commerce and catalog marketing.

Finally, we get out to the Hamptons, and we find a veritable plethora of Catalog Crazies and Catalog Fans. We see a similar trend as we move north toward White Plains.

Repeatedly, we see suburban customers who are focused on e-commerce, exurban customers who are potentially appropriately called "multichannel" customers, and rural customers near urban areas who prefer catalog marketing. Our marketing practices can adapt and respond to these realities. Remember, Catalog Crazies and Online Bliss customers spend nearly twice as much as the average customer.

It Never Rains In California: Hillstrom's Zip Code Forensics

Another fascinating geography, illustrated by Hillstrom's Zip Code Forensics (read about and purchase here), is the area between San Francisco and Lake Tahoe / Reno.

There are dramatic differences in customer preference as we move from west to east!

North of wine country, we have a catalog hotbed, with countless Catalog Crazies and Catalog Fans zip codes. In fact, you can follow the coast all the way up through Oregon, you'll find folks who love catalogs and spend $$$!

In the Bay Area, you predominantly find Online Bliss and Online Spend segments. The stereotypes of this geography hold true, these folks enjoy e-commerce.

You'll also notice lower productivity in the inner city zips of Oakland and San Jose, consistent with much of the country.

The valley doesn't have a lot of productive zip codes. But follow I-80 from Sacramento to Reno, and you see an e-commerce hotbed that is surrounded by multichannel zip codes to the north and south. Once again, as we head into mountain areas, we find customers who love direct-to-consumer commerce.

We have opportunities to alter marketing strategies based on customer behavior. Customers north of the Bay Area, along the coast, are not likely to be "multichannel". Why treat them that way? Customers in the Bay Area are likely to be e-commerce fans --- use search and social media to collaborate with these folks. And even our highway system plays a role in customer behavior --- I-80 from Sacramento to Reno spurs development, housing, affluent customers, and e-commerce spend.

Colorado: Mountains In Hillstrom's Zip Code Forensics

Hillstrom's Zip Code Forensics (read about and purchase here) clearly indicate that mountain states are direct marketing hotbeds.

Colorado might be the most interesting of the mountain states.

Looking at this map, we see several unique trends. Eastern Colorado has e-commerce potential, especially along I-70. Denver, like many major metropolitan areas, is not an e-commerce or direct marketing hotbed.

Move to the suburbs and exurbs, and you see a bunch of Online Bliss and Online Spend zips, the most productive online zip codes that exist.

And then we head west, into the Rockies, away from Denver. There, we find a ton of Catalog Crazies and Catalog Fans. This is interesting, because marketing best practices tell us to have a full multichannel offering for our customers --- yet the customers in Western Colorado love direct mail and catalogs, and use the telephone to place their orders. This is traditional catalog marketing at its finest.

When we think about catalog marketing, e-mail marketing, and search marketing through the perspective of Hillstrom's Zip Code Forensics, we think about many ways to customize and personalize our marketing to the folks we are communicating with. We don't send an e-mail marketing message offering buy online / pickup in stores to a customer in the Rockies of Colorado, do we? We don't necessarily scale our catalogs down to 48 pages to drive web traffic to a customer who lives in the Rockies of Colorado, do we? And we might think about social shopping when considering customers who live in Boulder.

Multichannel Marketing: A Weekend In Wisconsin

When you spend a morning in rural Wisconsin, you understand how messed-up multichannel marketing has become.

The interstate highway system transformed many small towns. In Wisconsin, I-43 was built along the old US-141.

Think about US-141 as the old school world of catalog marketing.

Think about I-43 as e-commerce.

Today, I drove along the old US-141. Here, we see a dramatically different world than we see along I-43, even though I-43 is just a third of a mile to the east. We see small towns. There are handmade signs for accountants, for bakers, for the Friday Fish Fry at the local tavern, for the farm implement. The buildings are old. Social Media doesn't exist here, though walking through the reception line after church is technically a high-octane version of Social Media!

Every mile or so, there is a blue sign pointing travelers to the Interstate Highway. This is like the best practice of e-mail marketing, or of using the catalog to direct the customer to a larger merchandise assortment online. I think there is irony in that the signs are blue --- blue representing a colder, more efficient form of travel.

Eventually, I-43 replaces the old US-141. Now I'm forced on to the Interstate Highway. This is like e-commerce at its finest. Everything moves fast. If you're not interested in a Friday Fish Fry, don't worry, you won't be pointed to one. There are big blue signs preceding every exit --- offering big brand choices for Gas, Food and Lodging This is a lot like paid search, you buy your way onto these signs, and by doing so, you gain a competitive advantage over the fools that cannot afford to advertise on the big blue signs.

There are few signs of life along I-43 --- the job of I-43 is to quickly transport you between Green Bay and Milwaukee without interruption, sort of like the role Google plays online. If you want to find somebody to bake a cake, you'll need to get off the freeway.

In the past thirty years, these two roads, the old US-141 and the newer I-43, evolved differently.

Along the freeway, commerce congregated near exits, creating a big box version of paradise suitable for any individual who needs to stay at a Super 8 motel, get gas at Shell, and eat lunch at Burger King.

Along the old highway, localized commerce thrives. And as expected, most of the signs point to I-43. Sure, there are signs on the freeway that point to the towns on the old road. But the real purpose of the freeway signs is to point you to the brands that are now between the freeway and the old road.

So here is where multichannel marketing is all messed up. If I-43 and the old US-141 followed multichannel best practices, we'd have a complete mess. All of the businesses along each highway would have to be the same. Travelers would be encouraged to spend equal time on each road, right? And those travelers would be the most valuable travelers. Everybody would want those travelers to spend equal time on each road, buying from local business and the brands along the freeway. Heck, we'd set up roadblocks on the local road (though not on the freeway, we don't do that with e-commerce), forcing travelers on the freeway so that they could support the brands along the exits.

We'd give these travelers incentives, like ten cents off a gallon of gas if the customer simply drove from the local road to the freeway to fill up. We would purposely build a church along an exit, then offer incentives for folks to visit the new church. We'd obsess about measuring the cars migrating from the old road to the new road, questioning each individual about the exact reason they got off the old road, trying to match back the localized activity that drove the traveler to the freeway.

In the real world, it doesn't work like this, does it? Nope, the freeway was built, local businesses died, brands saturated the exits, and a seismic shift in the makeup of the businesses along the local road was needed to allow the old US-141 to survive.

So why do the pundits continually force us into a box on multichannel business models? Why can't we let all of our micro-channel evolve in a manner best suited for each micro-channel --- well, not for each micro-channel, but for the way the customer wishes to use the micro-channel?

Listen to the pundits, because they have valid insights.

But move beyond the insights. Have vision. Consider how each of our micro-channels might best serve a customer. Leverage the strengths of each micro-channel, minimize customer exposure to the weaknesses of each micro-channel.

For catalogers, there are many weaknesses. The catalog is no longer relevant to a third of the audience it used to be relevant to. We keep mailing them, however, hoping for results to improve, and this is killing the profitability of our brands. E-mail is nothing short of a pointless disaster for so many of us --- driving a nickel or dime of revenue per e-mail. This has more to do with template-based best-practice design, redundant offers and promotions, and a scorched-Earth saturation of similar messages within and across brands (Up To 40% Off, LIMITED TIME ONLY) than it has to do with e-mail marketing as a micro-channel.

And then we have Social Media. Social Media micro-channels can be used to warm up the cold, efficient, Google-dominated world of e-commerce. But the pundits are ruining Social Media, too. Blogs are dead, conversations now happen on 140 character micro-blogging applications that have almost no business relevance whatsoever (unless you are a fan of customer service, then micro-blogging platforms are invaluable --- hint hint!). We were told businesses had to go down this path --- and once we became convinced we had to do this, the Social Media pundits all left to have their own tiny little discussions in the world of micro-blogging.

Maybe we should stop listening to all of these pundits, stop trying to prove the effectiveness of Social Media, and simply use Social Media to warm up the cold, lifeless world of e-commerce --- making it more like the old US-141 in Eastern Wisconsin. Maybe that's the best way to serve a customer.

Multichannel Forensics A to Z: YouTube

YouTube is a proxy for video. One day in the not-to-distant future, you'll utilize a lot of video on your website.

When we talk about micro-channels, video will likely become the most important entertainment micro-channel.

And entertainment micro-channels will become very important to brands that are, in the vernacular of Multichannel Forensics, in Acquisition Mode.

Home retailers are often in Acquisition Mode, with fewer than forty percent of customers purchasing again within the next twelve months. For these brands, what reason could the customer possibly have to come back and visit your website, when she has no need for the merchandise you offer in the short-term? Heck, she just purchased a couch and a rug, she's not likely to buy anything again anytime soon.

Acquisition Mode brands may use entertainment micro-channels like video to keep customers visiting the website in-between purchases. Think of it as the awareness-style advertising automobile companies use to keep their brands top-of-mind in the five years between car purchases --- except that the content is hosted on their own site, or on YouTube, where it serves as a customer acquisition vehicle.