Character

There's nothing like a catastrophe to reveal character.

When times are good, it can be hard to tell the good players from the bad ones. On a recent consulting project, the Executive Team were best friends. All was good. Business was great. When you are earning a $200,000 bonus you find it possible to coexist with people you disagree with.

Early in my consulting career, I worked with a client ... a bad client. You can see trouble coming a mile away, but you're starting your consulting career and you have to get paid somehow. On the surface, the client painted a positive story. They never shared sales/profit results (the client a paragraph earlier would share anything you asked to see), they just said they wanted "assistance". I was invited to a company picnic so I could see how well everybody got along. For the low cost of a day-long consulting visit and coach seating, I was asked a plethora of $100,000 questions. Merchants thought the Marketers were nuts. Marketers thought that the Analytics dude was a problem. The Analytics dude thought everybody was a problem.

Two weeks later, I received a phone call from Marketing Leadership. Business problems were now caused by ... wait for it ... wait for it ... me!! It was my fault. The Analytics guru and the Marketing Leader beat the living daylights out of me. Was it a great experience? Absolutely! You have to figure out how to manage Business Leaders.

I think about this client all the time. Bad business reveals character. This company assembled a weak group of Leaders, and those folks wanted somebody to blame ... why not the consultant who was paid a couple thousand dollars and was provided with the luxury of coach seating?

What happens when Business Leaders are faced with a modern response to a modern Plague?  You're finding out, in real time, aren't you? Bad business reveals character. If your Leadership Team is paying you not to work, lets you work from home, respects your efforts, pays your bonus regardless of sales levels, well, they've just revealed their true character to you.

Is your Executive Team treating you kindly even though there's only four months of cash left to say in business? Yes? Well, they're revealing their true character to you.

In response to Character, we're going to see a gigantic "reshuffling" of labor. Too many people lost jobs, too many companies were shut down causing damage that will be hard (but not impossible) to overcome. This will send labor scattering in all directions. There's no reason for a furloughed Macy's worker to come back to Macy's in three months when there will be choices (and there are ALWAYS choices ... even when ten million people are unemployed). Business Leaders who exhibit Character will retain employees while getting the pick of the litter of those who have not been treated well.

When we reboot the economy, we're going to see a gigantic reshuffling of labor. Be ready to take advantage of what is coming. Make sure your impeccable Character is valuable to your company. Make sure the Executives who lead your company exhibit Character, or consider finding a new company to work for when we open back up.

Planning Ahead

Start planning ahead now ... when your business begins the process of returning to normal, you're going to have four high-level segments of customers to address.

Segment 1 = Previous purchase via email marketing.

Segment 2 = No previous email purchase, recent email marketing click-through.

Segment 3 = No previous email purchase, no previous email marketing click-through, current email subscriber.

Segment 4 = Everybody else.


I know, I know, your vendor will tell you that this is too simple, that they have AI and Machine Learning designed to "micro-target" today's stressed "consumer". Fine. Work with them, you'll make money and everybody will be happy. Give this webinar a try while you are at it ... you should be listening to all advice right now. Or read through the deck of information outlined here. The key is to do something ... not to do specifically what I'm saying unless you align with my thought process. Given the overwhelming response to my QuickScores project offering, I know you're thinking very carefully about how to use email marketing to save money.

Most of my client base is in a tough spot unless selling toilet paper, soap, food, internet services, phone services, or at-home hobbying products. Your CFO already crafted a plan to reduce expenses ... your 25% salary cut is just part of what is coming. When business begins to reboot, your CFO is likely to surprise you with a significant reduction to the marketing budget. "Here, go figure out how to get by with less and oh by the way you better increase sales or you and your team are outta here."

Oh yeah, it's coming. This is how most companies deal with business downturns ... caused by the economy and now caused by something very different.

That's why you segment as I outlined above.

• Email Buyers.
• Email Clickers.
• Email Subscribers.
• Everybody Else.

If you can't spend money on catalogs or television ads or Google or Facebook ads, well, you'll need those email buyers because they've proven they'll buy based on your messages and not those on other platforms.

If you can't spend money on catalogs or television ads or Google or Facebook ads and the customer hasn't purchased via email, you'll want to tailor a unique strategy designed to appeal to those who are clicking and are just about ready to purchase ... and not, this isn't a cart abandonment email ... not close.

If you can't spend money on catalogs or television ads or Google or Facebook ads and the customer hasn't bought via email marketing and the customer hasn't engaged via email marketing, well, you'll want to have the ability to address the customer yourself because the customer cares just enough to subscribe to your email campaigns. This is where all of your email testing is going to happen ... almost no risk, right?

And if you can't spend money on catalogs or television ads or Google or Facebook ads and the customer hasn't purchased via email marketing and the customer hasn't engaged via email marketing and the customer doesn't subscribe to your email campaigns, well, now you have a problem that you have to solve, don't you?

Four simple segments.

Start planning ahead.

Build a marketing plan for each segment, so that when business begins to reboot you are ready to execute ... always better to execute than it is to react.

Starting Over

Excluding the minority of companies that have been unimaginably blessed by a worldwide pandemic (I'm looking at you Walmart and many online food brands), the rest of us will have to reboot our businesses at some point in the next few months. 

We'll literally start over. 

I know I've had to start over ... nobody cares about File Power when your business isn't allowed to be open. Nobody cares about Merchandise Forensics when you're not open. The majority of my project work over the past three years has no meaning in this world. I have to temporarily focus on saving companies money RIGHT NOW ... it's different now.

Some of us won't have access to a significant share of our Fall Assortment. Gonna be hard to sell stuff when you don't have merchandise to sell.

Some of us will have to liquidate millions of dollars of Spring Merchandise at a time when nobody wants to buy it and/or can't afford it.

The smartest marketers (hint - that's you) are already planning a reboot of the business ... and the smartest marketers are not going back to what they've always done (largely because the world won't ever be the way it was ... that world ended the moment Tom Hanks told us he tested positive on March 10). 

There's no way you are going to send a tepid email on a Thursday morning saying "We're All In This Together" and then offering the customer 30% off instead of 20% off. We aren't all in this together. Some people are making a killing off of a pandemic and many people are not able to pay rent, or are sitting in cars for miles waiting for food from a food bank ... and others are dealing with much, much worse. "We're all in this together" simply isn't good enough. It's time to craft a plan.

It's time prepare for the rebooting of our businesses ... literally and figuratively. Use the time you have in April to put your plan together. Most of us are starting over, whether we want to acknowledge the fact or not. May as well get a head start reinventing the future. You've spent your entire career ... either 40 years or 40 months ... preparing to do something amazing. You're about to get your chance. I'm confident you will shine!!!!!

Reboot

I ran a poll on Twitter late last week:

When do you think business will return to normal at your company?

• 13% = May 25.
• 20% = July 4.
• 28% = Labor Day.
• 39% = 2021 or Later.

By early this week, you can see how we might begin to reboot businesses in the Memorial Day to July 4 to Labor Day time-frame.

What does "rebooting" look like at your company?

1. For some of you, you bring employees back to the office on some sort of schedule and with new rules for interaction.
2. For some of you, it means the potential for digging out of a -50% hole.
3. For some of you, it means reopening after being closed for "x" weeks/months.
4. For many of you, it means figuring out how to reboot with a lot less in terms of marketing dollars.

So many of you in the print-side of this audience will go through a major transition.

• You will be asked to cut your circulation by 40%, +/-.
• You will be asked to find new customers in spite of the cut in your budget.
• You will be asked to use free or virtually free marketing channels to perform heavy-lifting.

Print readers know what is coming.

• Split your existing housefile into four pieces ... email buyers ... recent email clickers ... email subscribers ... and everybody else.
• You will reboot the email subscriber base differently than the non-subscriber base. 
• Your email marketing program will change ... becoming the most important program in your marketing department. You will abandon campaign-centric events in favor of merchandise personalization and encouraging messaging.
• You will leverage print effectively among customers who do not subscribe via email marketing.
• You will cut way back on print expense among email subscribers.

This is going to be thrust upon you out of necessity ... it's coming, and it is time to think ahead regarding how you will manage this transition during your reboot.


P.S.: A survey about what ad executives think is coming later this year (it's only 40 people, but you already knew the answer).

Monday Musings

Sports might be on hiatus (and for good reason) but marble racing is not (click here).

Orangutans and Otters ... we always knew they'd get along but then there's this (click here).

Washington Area Man faces charges after a high-speed chase ends with revelation that his dog was in the driver's seat and may have been driving the vehicle at times during the chase (click here).

Goodnight with Dolly (click here) ... every Thursday night.

You think you've got it bad? This is from 1991 (click here).

Apparel Catalogers ... go scour Etsy (click here) and then figure out how to push a small catalog out the door with face masks.

One-Page Summary Of What You Need To Provide For A QuickScore Project

I'm getting A LOT of inquiries about performing a QuickScore analysis ... so I thought I'd summarize the requirements for a project so you know exactly what you need to provide. When you contact me about starting a project, you'll already know what to do and you can just tell me to "go" and get busy.

Again, I will provide QuickScores at the ridiculously low cost of $8,000 for the duration of our COVID-19 stay-at-home situation ... and likely well into next year if issues continue. You deserve to get something at a very low cost right now, don't you?

And if you need the standard Contact Strategy project (if you are a catalog brand), read the bottom of this page for details. In the standard Contact Strategy project, you will learn exactly how many times you should mail a customer on an annual basis to optimize company profit.

Why QuickScores?  Your feedback suggests you will need to cut back on marketing expenses, and you need a tool to quickly and easily manage email marketing (targeting best email subscribers with the merchandise they love - personalized at a customer level) RIGHT NOW!!  Catalogers are telling me they want a simple score they can apply to their database to reduce catalog mailings to save money while better leveraging email marketing to target customers properly at a low cost, helping make up sales volume lost via print reductions.

QuickScores Project Outline

File #1 (Required): One row per item purchased, 5 years of purchase history, .csv file format required.

• Household_ID
• Order Date (20200402).
• Merchandise Category.
• Item Number.
• Quantity Purchased.
• Amount Spent.
• Physical Channel Purchased From (Mail, Phone, Online, Retail).
• Marketing Channel Purchased From (Paid Search, Email Marketing, Catalogs, Affiliates, Television, Radio etc).

 File #2 (Optional): One row per household, .csv file format required.

• Household_ID
• Email Subscription Date (20171118).

 File #3 (Optional):  One row per household, .csv file format required.

• Household_ID
• Date Customer Clicked-Through an Email Campaign (20190614).

File #4 (Optional / Catalog Brands Only):  One row per household, .csv file format required.

• Household_ID
• Number of catalogs mailed, past 12 months.
• Total cost of mailings at a customer level. 

Profit Data:  Percentage of demand that flows-through to profit (i.e. 42%).

What do you receive?

• Brand QuickScore:  Each customer is scored based on overall brand responsiveness, 0 to 100 (100 = best).
• Catalog QuickScore:  Each customer is scored based on catalog responsiveness, 0 to 100 (100 = best).
• Email QuickScore:  Each customer is scored based on likelihood of clicking through an email campaign (or buying via an email campaign if email clicks are not available), 0 to 100 (100 = best)..
• Primary Merchandise Category QuickScore:  Based on a weighting scheme, I tell you the merchandise category the customer prefers most, for email targeting purposes. You personalize email merchandise strategy via a combination of the Email QuickScore and Primary Merchandise QuickScore.
• Secondary Merchandise Category Quickscore:  Based on a weighting scheme, I tell you the merchandise category the customer prefers second-most, for email targeting purposes. You personalize email merchandise strategy via a combination of the Email QuickScore and Secondary Merchandise QuickScore.

 Project Cost:

• $8,000, held firm during the COVID-19 outbreak, due within 15 days of project completion.

 Project Length:

• Once data is received, the analysis should take 5-7 business days.

 Pseudo Code:

• A document will outline the pseudo code required to implement the scores in your customer data warehouse.
• You will also be sent the QuickScores, at a customer level, based on the most recent date in your database, so that you can act immediately upon the results.

 Project Add-On:

• If you are a catalog brand and you wish to know exactly how many catalogs to mail to customers on an annual basis to optimize annual profit, you can add the Contact Strategy component to your project.
• Annual Sales up to $30,000,000 = $8,000 QuickScores fee plus $9,000.
• Annual Sales $30,000,000 to $99,999,999 = $8,000 QuickScores fee plus $22,000.
• Annual Sales $100,000,000 to $999,999,999 = $8,000 QuickScores fee plus $32,000.
• Annual Sales $1,000,000,000 and above = $8,000 QuickScores fee plus $47,000.

Thanks,

Kevin

Oh, It Matters!

Take a look at the graph below. The blue line represents the probability of a customer buying next month by recency / given the fact the customer clicked through at least one email campaign in the past month. The green line represents the probability of a customer buying next month by recency / given the fact that the customer did not click through any email campaigns in the past month.

Which customer would you rather bet your career on? The customer who clicked through at least one email campaign last month, correct? The difference in response is staggering ... at all levels of recency. This one (1) attribute equalizes customers ... a customer with 40 months of recency becomes like a customer with 10 months of recency once the customer clicks through an email campaign. You'd want to know that, right? Oh, it matters!!

Append a QuickScore (click here) to your customer file and TAKE ACTION!!