This Week In Business: Cyber Monday

In the movie "The Matrix", a "bluepill" was a person who was still connected to the Matrix. A "redpill" was a person who had been freed.

As you already know, "Cyber Monday" is just nineteen days away. One might think of Cyber Monday as falling into the bluepill category.

Over in reality, the redpill marketer knows that traffic is higher on the Monday following Thanksgiving ... in fact, traffic is always higher on Monday than on Sunday. The redpill marketer, like every other day of the year, is trying to link customer needs with products that solve customer needs.

The bluepill marketer is connected to the Matrix. This is a blissful place, a never-ending maze of marketing enlightenment and discovery.

Offline marketing must be in-home two weeks prior to Cyber Monday, because you cannot be in-home the week before Thanksgiving, that's death. Offline marketing must be fully integrated with all digital Cyber Monday campaigns, and fortunately, there's no shortage of agencies who will help integrate marketing messages for you, messages like "Take 10% off and get free shipping, this Cyber Monday only!"

Messages need to be incorporated across all channels, because you cannot have inconsistent messaging, that would represent a bad customer experience. So the e-mail campaign you receive at midnight on Cyber Monday has a header saying "Take 10% off and get free shipping on Cyber Monday only!" Maybe there's even a few doorbuster items featured in the e-mail campaign, though you cannot really bust down a door online, but if you are a retailer, you want to use the term 'doorbuster' to integrate your online campaigns with your Black Friday 'doorbuster' retail campaign. Never mind that last year, a Wal-Mart worker died during a doorbuster promotion when the door actually busted down and customers trampled the employee, that was an unfortunate incident unrelated to the marketing phrase 'doorbuster', a phrase proven to help generate incremental sales.

The doorbuster items are featured via paid search with "Take 10% off and get free shipping on Cyber Monday only" copy that leads the customer to a landing page. Now this landing page had better be well-merchandised, because we don't want to lose the customer, no, we need the customer to migrate through the purchase funnel, sliding faster and faster toward that fabled hallmark of online marketing success ... the 'conversion'!

Should the customer mistakenly abandon a shopping cart, well, then we've all got a problem. Fortunately, the bluepills have a solution for this, and it is called a 'trigger-based e-mail marketing campaign'. Here, the customer is reminded that she left an item in her virtual shopping cart, but this time, she is offered a different subject line ... "Take 20% off and get free shipping on Cyber Monday only".

In a world of fully integrated multichannel marketing, the customer quickly races out to Twitter (on her mobile phone, of course), to see what other Cyber Monday shoppers are saying. Here, the customer finds a special promotion, only for Twitter followers ... "Take 25% off and get free shipping on Cyber Monday only".

It is this promotion that closes the deal! The customer, exhausted from her Cyber Monday prowl through Cyberspace, finally checks out, using a promo code from Twitter. Her $125 purchase with $14.95 shipping and handling only costs her $93.75.

Minutes later, nearly in real time, the Web Analytics professional is busy allocating this order to the marketing channels that drove the purchase. No actual tests were executed here, because you simply cannot afford to give away sales on Cyber Monday. Instead, a set of percentages based on established best practices will be used to allocate the order across marketing channels. No simplistic last-click allocation methodology will be allowed on Cyber Monday!!

• Offline Direct Marketing is credited with 15% of the order.
• The Midnight E-Mail marketing campaign is credited with 25% of the order.
• The Paid Search ad is credited with 15% of the order.
• The Shopping Cart Abandonment trigger-based e-mail marketing message is credited with 15% of the order.
• The Promo Code from Twitter is credited with 15% of the order.
• The Mobile Marketing department is credited with 15% of the order, too!

Internal fighting ensues, as marketing managers responsible for Twitter, triggered e-mail marketing, paid search, campaign e-mail marketing, mobile marketing, and offline direct marketing all argue that they deserve a greater share of this order. But we're measuring things in real-time, the company must know how every Cyber Monday order was generated no later than Tuesday at 7:00am when the information appears as a KPI on the corporate dashboard, so this allocation strategy will dictate the parsing of orders for now. Thank goodness that a new web analytics platform was installed, one that integrates offline and online data with budgeting decisions. But it is too bad that the offline data cannot be downloaded into the system for a week. The Web Analytics team will issue new reporting two weeks later, adjusting the allocation algorithm for the inclusion of offline orders. Hopefully somebody will pay attention to the adjusted results.

At midnight, Cyber Monday ends. Real-time reporting illustrates that this was the best Cyber Monday ever, with sales exceeding 2008 levels by 9%, closely mirroring predictions from Woodside Research. By 3:00am, it will be revealed that multichannel marketing campaigns were the most effective at driving Cyber Monday sales, and that social media discounts and promotions accounted for up to 30% of Cyber Monday sales, proving once again the importance of having an integrated marketing message across all channels, supported by real-time analytics that integrate data across all touchpoints.

The day after Cyber Monday is a day of satisfaction, a day to crunch numbers, a day to reflect. On Wednesday, the process begins anew, as peak shopping days before the Holiday season are just around the corner. It is time for more marketing, more campaigns, more measurement, more real-time analysis, more KPIs and dashboards, more promotions, more discounts, more landing page optimization, maybe even a few A/B tests tossed in for good measure.

For the bluepill, it is a non-stop rush, pure marketing bliss, resulting in $93.75 of revenue per customer. Sales were up 49% vs. not having any Cyber Monday support, resulting in $139.95 of volume.

For the redpill, Cyber Monday was a day when a customer spent $125, plus $14.95 shipping and handling, for a total of $139.95. Finance will tally the results at the end of the month.

Your Digital Marketing Plan

Give this article a read. It's not your industry, and I'm not promising any of this will work for your business, but the article gives ample opportunities to think about online marketing through a social lens. Check out the homepage design these folks put up on a whiteboard. Interesting, isn't it?

And notice how they are asking fans to e-mail ten friends, tracking results with CRM software. Are any of us, supposedly sophisticated database marketers, doing this? Notice their CRM-based tracking via Twitter as well.

How do these lessons apply to your business? What is stopping you from trying these strategies? Read this, not like a 53 year old direct marketing Director or 39 year old online marketing Executive, but like an outsider might read it.

Firing Customers

E-mail me if you want a copy of the OMS spreadsheet to follow along with on our examples. Click here to buy the book on Amazon, or click here to purchase the book for your Kindle.

The concept of firing customers is a popular one. We read a lot of content that tells us to focus on the 20% of our customer base, the part of the customer base that generates most of the demand.

I'm not here to tell you that the strategy is right or wrong. I'm here to give you the tools to understand what it means to fire customers.

In our OMS spreadsheet, we grade customers with a grade of "A", "B", "C", "D", and "F". So today, we're going to attempt an experiment.

Open your spreadsheet. Notice the five year sales trajectory of this business.

• Year 1 = $75.9 million.
• Year 2 = $70.4 million.
• Year 3 = $66.7 million.
• Year 4 = $64.4 million.
• Year 5 = $62.9 million.

Clearly, this business is in free fall. So, let's do something odd. Let's fire every customer with a grade of "D" or "F". These customers cannot purchase again, ever. We'll literally block them from buying from us. Any customer that falls into a grade of "D" or "F", during the next five years, is prevented from buying again in our simulation.

Enter the value "0.00" into cells C245 - C340. This means that customers with a grade of "D" or "F" cannot buy again. We'll keep acquiring new customers. Take a look at the results.

• Year 1 = $73.4 million.
• Year 2 = $66.1 million.
• Year 3 = $60.4 million.
• Year 4 = $56.1 million.
• Year 5 = $52.9 million.

In the first year, firing customers has almost no impact on sales ... sales decrease from $75.9 million to $73.4 million.

In the fifth year of the simulation, firing customers has a significant impact on sales ... sales decrease from $62.9 million to $52.9 million.

Your job is to determine if this type of decision increases profit, or decreases profit. My job is to show you that there is a cumulative impact that results from the decisions we make today. So many of us in the Web Analytics community and Online Marketing community look to optimize conversion rate, seeking to optimize the performance of the business today.

Hint: The Online Marketing world is "inefficient". When everybody is trying to optimize short-term results, you gain a competitive advantage by optimizing long-term performance. Use the OMS framework to do this!!

Dear Catalog CEOs: Our Multichannel Mess

Dear Catalog CEOs:

Want to have some fun? Go back to 2002, and read this roundtable interview with numerous catalog CEOs, facilitated by Catalog Age magazine.

Remember Catalog Age? A publication dedicated to catalog marketers? Well, they changed. The rebranded themselves as Multichannel Merchant, and when the world changed again, a portion of their empire evolved into The Big Fat Marketing Blog. What comes after that? But they did change with the times.

After reading the article from 2002, I don't find thinking that is significantly different than the thinking that pervades our industry in 2009. We grumble about postage. We say it is getting harder to prospect. We say that online marketers are raising the customer service expectation bar. We say that banner advertising doesn't work.

For many in the catalog industry, the phrase "multichannel" means nothing more than a bunch of channels and tactics that are there to support the continued production of catalogs.

Our industry invented the "matchback", a methodology that allows us to over-inflate catalog importance and deflate the credit we give to all other channels. At a time when all other marketers were increasing their investment in online marketing, we were allocating our investment back to the old stalwart, the catalog.

At a time when all other marketers were figuring out how to optimize landing pages, we were figuring out how to optimize printed pages.

At a time when all other marketers were using java script to dynamically generate online content based on consumer preferences, we were drinking java while dynamically figuring out how many pages had to be sent to cause an online order to happen.

At a time when all other marketers were optimizing their search marketing activities, we were searching for the best co-op to find names to send our marketing activities to.

At a time when all other marketers were learning all of the ways that customers integrated themselves with websites and social media, we integrated our websites with our retail and catalog channels, largely because our vendor partners encouraged us to do so.

We took the road less traveled by. And that has made all of the difference.

Last week, a person commenting on a blog suggested that I don't offer solutions, I just point out the obvious.

I feel like I've offered more solutions on this blog, for free, than any person in the catalog industry. Go back over the past 3-4 years and read the content, then compare it with the content from the vendors in the catalog industry. I'm trying to communicate how we can stay in business. It seems that unless the solution includes mailing a catalog, the industry doesn't perceive the solution as being viable.

Here is a laundry list of tactics, strategies, and potential solutions. Why not give a few of these a try?

1. Immediately test reduced frequency to best customers, and measure the incremental profit you achieve when reducing contact frequency.
2. Immediately test reduced pages per contact to all customers, and measure the incremental profit you achieve when reducing pages per contact.
3. Immediately calculate the "organic percentage", the percentage of demand that you will generate if you stop all catalog marketing. Calculate the profitability of your business sans catalog marketing.
4. Do not mail any catalogs next July. Instead, take your catalog investment, and allocate it across all online marketing channels. Carefully measure how customer behavior changes next July.
5. Execute mail and holdout tests in EVERY catalog, across EVERY customer segment. DO THIS NOW! Have your matchback vendor match online orders to the control group --- this quantifies how much damage your matchback vendor has done to your business by over-stating your catalog results. I cannot stress how important this is.
6. Set up a holdout group for at least six months, if not one year, and do not mail catalogs to this holdout group during this time. Within this audience, test halving your e-mail contact strategy, and test doubling your e-mail contact strategy.
7. Invest as much time on your online landing pages as you invest in catalog landing pages. Put your online landing pages up on the hallway walls of your office, just like you do with your catalog spreads, and measure the resultant profitability of every single action a customer can take on your landing pages.
8. In every meeting you have, you must spend equal time talking about catalogs and about your website. Yes, EQUAL TIME!
9. In every catalog marketing meeting you have, invite your online marketing experts in, and have them critique your catalog marketing activities. You've spent ten years having your catalog marketing experts integrate your website into your catalog business, now try doing the opposite, and see what happens.
10. Test your catalog creative, to find the style of creative that is most effective at driving customers online.
11. Test offering only best selling products in catalogs to prospects.
12. Test offering only new products in catalogs to existing customers.
13. Immediately change strategy and diversify your marketing activities if 50% or more of your online business is sourced from catalog marketing.
14. Use Multichannel Forensics to quantify if customers are likely to continue shifting online, or have finished their channel shift.
15. Optimize your catalog business for rural, 55+ year old customers who shop via the telephone.
16. Optimize your online business for EVERYBODY else.
17. Have your team create a marketing plan for a situation where you are not allowed to rent or exchange name and address without prior customer permission. More than anything else, this exercise will prepare you for the future.
18. Have your team create a marketing plan for a situation where every single catalog cost 50% more than it costs today. This exercise will prepare you for the future.
19. Develop a five year sales plan by advertising channel, if you don't already have one in place. It is irresponsible to not be prepared for the future.
20. Visit a non-competitive online e-commerce brand, and facilitate four days of knowledge exchange. On Day 1, the e-commerce brand tells you how they acquire customers. On Day 2, you explain to them how you acquire customers. On Day 3, the e-commerce brand tells you how they optimize online conversion. On Day 4, you tell them how you optimize offline conversion. Tell me you aren't going to learn something from this exercise.
21. Stop laying off your call center staff, and instead, unleash a fraction of these individuals in the social media ecosystem, sort of like how Zappos does.
22. Stop treating online customers from online advertising sources like catalog customers. Enjoy making additional profit after employing this strategy.
23. Spend more time optimizing fulfillment rates, return rates, and distribution center expenses than you spend managing social media.
24. Ask every one of your contact center and distribution center employees why they would shop from your catalog if they can find a similar product at the same price via an online brand that offers free shipping. Carefully record their responses. Change your strategy, based on their responses.
25. Spend more time with your search vendor than you spend with your co-op vendor.
26. Spend more time with your e-mail vendor than you spend with your co-op vendor.

I could go on and on, forever.

Maybe the economy will improve in 2010. Maybe customers will re-embrace catalog marketing. And maybe the old business model will thrive once again.

If those things don't happen, isn't it time to pull ourselves out of the multichannel view of the world that was so popular in 2002? If the multichannel view of the world yielded success, would so many companies be struggling, struggling long before the economy imploded or before postage increased?

As always, I am here to help you!

Thanks,
Kevin

Digital Download Now Available: Online Marketing Simulations

Oh sure, I can offer merchandise across multiple channels!

You can buy the book on Amazon.com, $19.95 --- click here.

You can buy the Kindle version via Amazon, $4.99 --- click here.

And now, you can purchase a digital download of the new book for $4.99 via Lulu.com --- click here.

If you are a "best customer", you'll purchase this book in multiple channels, right? I mean, multichannel customers are the best customers, so that means you'll probably purchase multiple copies in multiple channels!

Gliebers Dresses: Bonuses

Welcome to the weekly Gliebers Dresses Executive Meeting:

Glenn Glieber (Owner): "After watching Brett Favre mulch his former team, I started thinking about Sarah Wheldon. It's really the same situation, in so many ways."

Meredith Thompson (Chief Merchandising Officer): "Kevin, is that you?"

Kevin: "Yup, it's me."

Lois Gladstone (Chief Financial Officer): "I'd like to take time today to talk about bonuses."

Roger Morgan (Chief Operations Officer): "I love bonuses! Bonuses are how I pay for just about all of my major home improvements, and they are used whenever I need a new car."

Lois Gladstone: "Well, Roger, I've got some bad news for you."

Roger Morgan: "Oh no."

Lois Gladstone: "We have less than two months left in the calendar year. As you already know, we are eligible to earn up to 60% of our salary via an annual bonus payout. Our bonus is broken down into three components. 35% of the bonus is based on achieving total net sales goals. 50% of the bonus is based on achieving total profit goals. 15% of the bonus is based on individual objectives, based on your area of expertise. "

Pepper Morgan (Chief Marketing Officer): "Here it comes ..."

Lois Gladstone: "Based on year-end projections, here is where we stand. Year-end net sales are forecast to be $45,000,000. In our bonus structure, this will earn us a grade of "D", so we get 25% of 35%, or 9% of our salary. Year-end profit is forecast to be $0, break-even. In our bonus structure, this also earns us a grade of "D", so we get 25% of 50%, or 13%. Assuming that every Executive member earns a grade of "C" on individual performance, we tack on another 50% of 20%, or 10%. This means that the average bonus for this team will be (9% + 13% + 10%) * 60% = 19%.

Roger Morgan: "After taxes, I won't even be able to buy a Hyundai for 19% of my salary!"

Meredith Thompson: "I'm worried about our rank-and-file staff. Their bonus target is just 15%. On average, they will get, what, 5%? If they are earning an average of $50,000 a year, that's a paltry $2,500.

Lois Gladstone: "But here's the problem. That paltry $2,500, which also goes to contact center staff who work 3/4 of the year, really adds up. Add in our bonuses, add in bonuses for our Directors and Managers who are at 30% and 20% bonus targets respectively, and you're looking at a million dollars or more that we pay out in bonuses, roughly 2% of EBIT. For Gleibers Dresses, bonuses are going to be the difference between being a break-even company, and being a company that is profitable in the face of The Great Recession."

Meredith Thompson: "What are you thinking about doing, Lois?"

Lois Gladstone: "I'm thinking of taking away bonuses from any individual who has not achieved the level of 'Director' or 'Vice President'. It just makes good financial sense to do this, and to do this now, while the economy is just plain awful. Employees are just happy to keep their job right now."

Pepper Morgan: "Aren't bonuses supposed to inspire us to perform well? Without the incentive, who's to say we would have even achieved profitability?"

Roger Morgan: "I agree with Pepper. And for crying out loud, we're like the only company who pays a bonus to call center and distribution center staff. It is our competitive advantage. It is the way we get to hire the best employees in all of New England. It's like free marketing for us."

Glenn Glieber: "I love free marketing!"

Meredith Thompson: "How can you even think about taking something away from our people? If we did this, it would be devastating to our employees."

Lois Gladstone: "If we did this, we'd protect the profitability of our company. The only way we stay in business is if we generate profit. And right now, what we're doing as leaders are not generating enough profit to allow us to continue running our business 'as-is'. If we had magical merchandising or marketing ideas that were proving to yield huge levels of profit, I'd feel differently."

Meredith Thompson: "But why take money away from the folks who need it most?"

Lois Gladstone: "Well, of course they need it the most. But our compensation package is a bit too generous. We need to scale it back to levels that are competitive with our competitors. Anna Carter sure doesn't pay a sales rep on the phone a bonus, I can tell you that."

Meredith Thompson: "Kevin, help!"

Kevin: "I know you are planning on freezing salaries this year, and you've already communicated that to your employees. Couldn't you give each employee a 3% salary increase at the time you take away the bonus, so that the employee doesn't feel completely ripped off?"

Lois Gladstone: "Absolutely not. Salary increases are like compound interest. Next year, when you give the employee a 3% increase, it is actually 3% on top of 3%, or a two-year increase of 6.1%. That's why bonuses are such a good idea, as a compensation philosophy. You take away that compounding of interest, which, in the long-term, helps a business be a lot more profitable."

Meredith Thompson: "But you're also taking away the bonus, Lois! The employee just gets clobbered."

Lois Gladstone: "Look, I didn't bring on the economic crisis, did I? But it is my job to respond to the crisis in a way that protects all of us. Do we want for this business to be profitable? If we do, then we do one of two things. We can increase merchandise productivity, something we're not good at. Or we can reduce expenses. Salaries and bonuses are two components of the expense structure. Until we figure out how to grow our business via merchandise and marketing productivity, I am taking away annual bonuses from hourly staff, analysts, and manager staff. I am freezing wage increases for all employees, including us sitting here at this table. The combined impact of these decisions is $1.2 million that goes straight to the bottom line, making Gleibers Dresses profitable once again."

Kevin: "So the question is, what are you going to do with the money at the end of 2010? Pepper showed me reporting that suggests if we invested the money in various paid search activities, we could generate profit within the calendar year. Wouldn't that be a good thing? If you are taking something away from employees, can't you at least demonstrate to them that you are going to make an investment that protects their jobs, long-term?"

Lois Gladstone: "It's my job to protect shareholder value, and in this case, Glenn is the shareholder. At the end of 2010, we'd pay our fair share of federal taxes, and Glenn would pocket the savings as personal profit, being the owner of this business."

Meredith Thompson: "By doing that, it means that profit would significantly increase, and that means we'd all get paid bigger bonuses, right? And Lois, a portion of your bonus is based on personal performance, so in essence, you'll double-dip on your bonus. That's lovely! In essence, we're now taking money away from our own employees, so that we can pay ourselves more. That's just sheer greed."

Lois Gladstone: "None of this would be necessary if merchandise productivity were better. And we need to keep our leadership bonuses, in order for the compensation structure to remain competitive. Otherwise, our Executives will leave. We want to keep the best Executive talent, right?"

Meredith Thompson: "Not true. Not true. We could break-even again next year. We are making a conscious choice to take money away from employees, so that the company is more profitable, so that we can earn bigger bonuses and so that Glenn can take home two-thirds of a million dollars."

Lois Gladstone: "As owner, Glenn can do what he wants to do. This is his business, he owns it, the employees do not own it. It is our job to make sure Glenn is paid as much as is humanly possible. That's capitalism. I am only doing my job. And if we want to avoid problems like this in the future, we better get a lot more efficient with other expenses, or start putting merchandise and marketing out there that customers crave. Roger, Pepper, if you disagree, make sure your voice is heard, but regardless, the train is leaving the station."

Pepper Morgan: "I'd rather invest the money in marketing, so that our customers pay us back, so that we earn more profit, so that all employees can earn salary increases and have their bonuses re-instated."

Roger Morgan: "Lois, are you going to come to the contact center and distribution center and communicate this message? People are going to be livid. They should hear the message from the person responsible for the change in compensation strategy."

Lois Gladstone: "Each department head will communicate the strategy to their employees, just like we've always done. We'll have human resources draw up 'talking points', illustrating why we need to make this decision, pointing out that this is better than another 20% headcount reduction. In this economy, with 10% unemployment, employees will be happy to simply keep their job, right?"

Roger Morgan: "This is how the middle class gets wiped out. When business is good, they borrow money out of their homes at 5% interest. When business is bad, they lose their job or they lose their bonus or their salaries are frozen. No matter what, the employee keeps getting further and further behind."

Lois Gladstone: "Or maybe the employee needs to figure out how to make this company more money. Maybe the employee needs to take personal accountability. Maybe the employee shouldn't lounge around on a 90 minute lunch break. Maybe the employee should try to make Gliebers Dresses more money instead of tweeting about salary freezes to the social media folks. The only reason we come to work each and every day is to make this enterprise as profitable as possible. That's it. All of those niceties and mission statement quotes and dedication to customer service, that's all secondary to the main point of capitalism, that being to earn as much money as you possibly can. The culture of this place needs to change. People need to be accountable to profit, and if they generate profit, the business will take care of them. Listen, folks, if your people don't like this, they're free to leave. They should go find another job, have at it! Prior to me arriving last year, this place was run like a family. It needs to be run like a business if it is going to survive."

Roger Morgan: "Glenn, are these your thoughts channeled through Lois, or what?"

Glenn Glieber: "I think we've lost focus on profit, to some extent. We spent this year talking about marketing and merchandising strategies. None of what we've talked about is working. We've cut marketing expenses to the bone. I'm not sure I know what else to do in order to make us profitable. I don't see any other way out. I lost 40% of my 401k last fall. I invested all of my profit either back into the business, or into my 401k. The economy cost me 40% of my career. Think about that. I've run this business profitably for 39 of 42 years, and just like that, 40% of my 401k was gone, the same thing as losing 16 years of effort, 5,800 days of toil and effort vaporized just like that. I devoted my life to this business. I deserve a better end to the story. I'm tired. I'm not sure I'm going to keep coming in to work in 2011 and beyond. So, yes, if I want to benefit from the profit of this business, I am entitled to channel some of my wishes through Lois. And it is her job to find a way for my business to be more profitable. I'd rather freeze salaries and eliminate bonuses than lay off another 20% of the workforce. And that's all I have to say about that topic. Now, on to the next item on the agenda. I wanted to communicate to each of you that we will no longer be serving Snickers bars, Milky Way bars, or Three Musketeer bars in the vending machines, because they keep getting stuck, and Henrietta Geldon in purchasing is sick of hearing employees thump their fists on the vending machine. Roger's team tells me that Twix bars slide out much easier, so we will be switching to Twix bars, going forward. Any questions?"

Different Customers, Different Behaviors

Online Marketing Simulations (buy the book on Amazon.com) routinely show us that different customers exhibit different behaviors.

Go to the sample spreadsheet (e-mail me for a copy), and do the following:

• Enter 0.00 in C6 - G6.
• Zero-out cells B149 - B340.

Here, we're running a simulation, evaluating only how customers with a Grade = A (the very best customers) perform over time. Play close attention to cells J5 - N7, these cells represent the sales trajectory of best customers across three advertising channels.

Don't save these results. Close the spreadsheet, then open it again, and do the following.

• Enter 0.00 in C6 - G6.
• Zero-out cells B101 - B292

Here, we're running a simulation, evaluating only how customers with a Grade = F (the most marginal customers in your database) perform over time. Look at cells J5 - N7. What do you observe? Well, Channel 2 gets disproportionately more sales, while Channel 3 gets disproportionately less sales.

This happens in your business too, folks. You will see that your best customers have purchase preferences that are different than are the preferences of marginal customers.

Use this information to your advantage. Know which marketing channels appeal to best customers, and to marginal customers!