Omnichannel Is Not A Strategy

Omnichannel is not a strategy. It's an optimization tactic, an important part of the Optimization component of the Great Eight, but it is not a strategy.

Strategies grow brands ... reference Amazon if you're curious about what a strategy looks like.

From 2013 - here's Macy's plan for omnichannel dominance (click here). How did that work out? Since the article was written, Macy's generated $2.5 billion less in annual net sales than they generated six years ago. That's what happens when you put all your chips on one tactic within the Optimization category of the Great Eight without having an overall (compelling) strategy.

The New Marketing Leader needs to have a comprehensive plan for each category within the Great Eight.

• Audience.
• Awareness.
• Acquisition.
• Welcome Program.
• Anniversary Program.
• Optimization Program.
• New Merchandise.
• Winning Merchandise.

Omnichannel has nothing to do with merchandise. It has nothing to do with an Anniversary Program that has several key events each year (think Amazon Prime Day or Nordstrom Anniversary Sale). It has nothing to do with a credible Welcome Program that quickly converts the customer to a second purchase. 

It "could" help with customer acquisition.

It "could" generate awareness, though it's a lousy way to run an awareness program.

It "could" resonate with your Audience, though if it did, sales would greatly increase instead of decreasing by 10% over time.

The New Marketing Leader has answers for each category within the Great Eight ... of which Omnichannel is a tiny, TINY component.

You have a comprehensive program encompassing the Great Eight, correct? Right??

Personalization Is Not A Strategy

Ok, we weeded out a bunch of followers who apparently didn't like the concept of implementing your own Marketing Management System.

But it's terribly important.

Why?

Check this out. In 2015 Pier 1 earned gushing reviews for implementing personalization initiatives (click here).

Check this out. In 2019, Pier 1 is about to see their stock delisted and they're struggling to survive (click here).

Personalization is not a strategy. It's a tactic ... a darn good tactic, an optimization tactic. But personalization doesn't lead to growth ... well, that's not entirely true. Tiny growth is possible. A pure e-commerce brand might see "some" growth. For a retailer? Not so much.

If you are a New Marketing Leader, yes, you'll have personalization as part of your "Optimization" category within the Great Eight (click here). But "what" exactly are you personalizing? And "why" are you personalizing anything? What does your personalization effort support?

Those questions need to be answered ... the New Marketing Leader has an entire strategy of which personalization is a tiny component.


P.S.: Personalization is darn important ... I have clients who increase email response by 20% and various online endeavors by between 15% and 50%. However, top-line sales are rarely moved a ton by personalization. You need new customers or merchandise productivity to move the top-line. But you already know that, don't you?

Describe Your Plan, Part 4

https://www.datamann.com/datamann-seminar-april-2019/

Let's assume you inherit a business with the following dynamics:

• +3% Overall Merchandise Productivity.
• +14% New Merchandise Productivity.
• -8% Existing Merchandise Productivity.
• -6% New + Reactivated Buyer Comps.
• 100,000 12 month buyers last year, 40% rebuy rate, 40,000 active buyers.
• 55,000 new + reactivated buyers last year.

Tell me what is wrong with this business, and tell me what kind of plan you'd implement to fix this business?

Describe Your Plan, Part 3

https://www.datamann.com/datamann-seminar-april-2019/

Let's say you inherit this type of business:

• -6% Overall Merchandise Productivity.
• -2% New Merchandise Productivity.
• -11% Existing Merchandise Productivity.
• -20% New + Reactivated Buyer Comps.
• 100,000 12 month buyers last year, 40% rebuy rate, 40,000 active buyers.
• 47,000 new + reactivated buyers last year.

This is one of the most common situations the new marketing leader inherits ... EVERYTHING is broken.

What this business desperately needs is a Leader.

That's where you come into play.

You need to have a plan for every one of the Great Eight.

You don't have a choice ... this business is fundamentally broken. You will address all eight tactics, and you will communicate clearly to every employee in the company that every single aspect of the business is broken and is FIXABLE!!!!

You are going to be the hero.

Get busy fixing things!

Describe Your Plan, Part 2

https://www.datamann.com/datamann-seminar-april-2019/

Let's say you inherit a marketing team, and your business possesses the following dynamics:

• +8% Overall Merchandise Productivity.
• +9% New Merchandise Productivity.
• +7% Existing Merchandise Productivity.
• -18% New + Reactivated Buyer Comps.
• 100,000 12 month buyers last year, 40% rebuy rate, 40,000 active buyers.
• 50,000 new + reactivated buyers last year.

What does this tell you?

• Your merchandising team is doing a fabulous job.
• The prior marketing leader messed up the business, bad.

Your first job is to fix customer acquisition. Period. Your marketing strategy is the problem. You are the problem. And in a month or so, you'll be the one blamed for business not meeting expectations.

It's on you to fix this problem, asap.

You'll focus on the following.

• Audience.
• Awareness.
• Acquisition.
• Optimization (i.e. search and offline advertising).

Quite honestly, this business is being held back by one person ... and that person is you. It doesn't matter what your predecessor did, you run marketing now and if you don't fix this problem, everybody suffers.

Get busy!!

Describe Your Plan, Part 1

https://www.datamann.com/datamann-seminar-april-2019/

When you take over the marketing department, you need to have a plan. A plan is critical. And you leverage the "Great Eight" to execute your plan.

Let's say you take over Leadership of the Marketing Team. You run your comp segment metrics and you learn the following:

• -4% Overall Merchandise Productivity.
• -14% New Merchandise Productivity.
• +2% Existing Merchandise Productivity.
• -3% New + Reactivated Buyer Comps.
• 100,000 12 month buyers last year, 40% rebuy rate, 40,000 active buyers.
• 62,000 new + reactivated buyers last year.

You basically have a ton of data, right there alone ... you can figure out what your brand needs to do.

What is wrong with this business?

This one is easy, isn't it?

Your merchandising team is imploding the business via new merchandise. Obviously you'll have to dig in deeper and figure out "what" the real problem is ... but you are not dealing with a marketing problem, you are dealing with a merchandising problem.

As a new marketing leader, you probably don't have control over what the merchandising team is doing. But you have analytics on your side, and you can act accordingly.

Notice that new + reactivated comps are -3%. If merchandise productivity is -4%, then adjusted new + reactivated comps are really -3% - (-4%) = +1%. It means that marketing efforts are performing accordingly.

Also notice that you started the year with 100,000 twelve-month buyers, and 40% repurchased, yielding 40,000 active buyers. Couple that with 62,000 new + reactivated buyers, and you grew the customer file by 2,000 customers (100,000*0.4 + 62,000 = 102,000).

This means that new + reactivated buyers are not a problem (unless management wants a lot of growth).

You've diagnosed the issue:

1. Your Merchants are harming the business with too little or unproductive new merchandise.
2. Marketing is managing the customer file appropriately.

Within the Great Eight we have options.

I'd focus my efforts on Awareness, Welcome Program, Optimization Program, and New Merchandise. I'd calibrate my email marketing program to focus on the new merchandise that is performing well, working hard to get 'em to winning status. Awareness programs will be important because the annual rebuy rate is at 40%. Welcome programs will be important because we want to convert the customer to a second purchase quickly given that rebuy rates are low. Optimization programs are important because with sluggish merchandise productivity we have to save every penny we have to protect the profit and loss statement.

Now you have a foundation to begin your tenure as the new marketing leader. And you can align the rest of the company around your initiatives. Get busy!!

Repost Due To Delivery Problem From Yesterday

I am re-posting this today given that 75% of yesterday's deliveries failed for some wonky reason that my email provider cannot explain.


How about joining me in Nashua on Thursday, April 18?? Click here to register!!

I'm taking a different approach to my presentation. In the past few years, I've asked organizations to change. That simply doesn't work. You can't present a bunch of ideas to a Director at Orvis and expect the individual to change the organization. The ideas aren't the ideas of the Director at Orvis ... they're my ideas. Why would a VP at Orvis adopt the idea of a speaker with no skin in the game?

So this year the presentation is all about you ... yes ... YOU! You are reading this because you are likely a Marketing/Analytics Leader, or you want to be a Marketing/Analytics Leader. 

In the past year or two, there's been a huge influx of new Leaders ... the Baby Boomer generation has had thirty years to dominate commerce, and they are now passing the torch to younger Gen-X folks or older Millennials. This is a very exciting and challenging time in the career path of a young professional. It's also a disorienting time ... you are new and a lot of people around you have twenty or thirty years of Management experience. They have their ways of doing things, and they're going to impose their style of Management upon you.

This became clear to me a few years ago ... I sat in a room while a Young Professional shared six months of findings about how to grow the business (not only how to grow it, but how she already grew it without anybody else knowing what she accomplished) ... when her presentation ended, one VP whispered to another VP "she's young, she'll come around to how we do things around here". In other words, the seasoned leaders did not respect what this person accomplished (and hint - this person grew sales by 10% or more, something almost nobody else accomplished at the company in the past decade).

The hour-long session just plain angered me. How could these Leaders treat this woman so poorly, given how good she made them look?

It became clear that the new Marketing Leader needs a set of tools to "set the tone" ... to diagnose real problems (not the problems people perceive to exist) ... and then to align the organization around what really matters.

I went through this process ... I didn't have a formalized process in 1998 at Eddie Bauer and I paid the price for being new and disorganized. I did have a formalized process in 2001 at Nordstrom and while some folks hated my process, the process worked wonders. And yes, the process generated enemies ... but it was so important to have a process in place and to constantly point back to the process and say "this is what we are doing, and this is why we are doing it" ... and to not get distracted by noise, even if the noise came from those who could fire you!!

I'll spend two hours sharing with you the process and diagnostics necessary to get you, the New Marketing Leader, set up for success.

This talk will be about you. No more sharing of tactics that you'll disagree with and say "Thank You, Next". This time you are responsible for doing something. I have faith that you are ready to do great things!

Join me in Nashua on April 18, ok?