Same Experience Across Channels

Seamless and Frictionless? Yeah, I suppose I could sign-on for that.

Same experience? Nooooo.

Channels should have a reason for being. Each channel should be special. I worked with a tobacco brand many years ago that sent postcards featuring one product and only one product. This product belonged to a category that "fueled" other categories. Customers bought from the postcard, and that caused the customer to cross-shop in the future. The channel (postcard) had a purpose, and the purpose aligned with the category/item featured. Well done.

The same brand used email marketing as a low-price channel ... "they're all looking for deals anyway" was a common refrain.

Those of you with stores know what the investment looks like over the next 5-10 years ... you will spend a fortune literally reinventing what in-store shopping looks like. This necessary step should have happened in the past 8-13 years. It's going to happen now. There must be a compelling/entertaining reason to step in a store or why have the darn store in the first place?

Every channel should have a unique purpose or you shouldn't dabble in the channel.

Every channel has a category that thrives in the channel. Stop featuring random nonsense and learn what sells in each channel. You can do this!!

A Completely Unscientific Poll

I ran a poll on Twitter asking readers what percentage of their annual apparel purchases are in stores? 86 brave souls responded.

• 21% said none of their apparel purchases were in a store.
• 36% said a third of their apparel purchases were in a store.
• 31% said two-thirds of their apparel purchases were in a store.
• 12% said all of their apparel purchases were in a store.

If you perform a weighted average of those metrics you land at 45%.

Again, completely unscientific. Highly biased. Not actionable.

Still interesting.

The transformation that is coming for retail will be breathtaking. Retail isn't going away. But individual stores are going to go away at levels we haven't previously considered. Remember, the amount of retail square footage in the United States is way ... way ... WAY more than it is in other countries. Which means the closures will be way ... way ... way more than in other countries.

Every transformation comes with opportunity. How you merchandise a store ... how you construct a store ... how you entertain in a store ... will all be very different in ten years, by necessity. The categories you choose to feature will be different than what you feature online. The sameness we've been taught across channels is going to go away, replaced by doing what is necessary to generate $$$ in a store. You simply cannot have the same experience in every channel anymore. Cannot. 

Look at sports for examples - is the NFL Sunday Ticket experience remotely similar to attending a game? That dichotomy is coming to retail / e-commerce.

Quite honestly, it's going to be an exciting transformation.

Online / Store Relationships

The online/store relationship has gone through a transformation over the past twenty years.

In 2003, you brought in a new customer via e-commerce and that customer migrated over to the store and generally became a good store customer over time.

Not true in 2023.

In 2023, customers have preferences. There are e-commerce customers. There are clearly in-store retail shoppers who embrace that channel, and those customers are a bit less likely to cross-over and buy from e-commerce than they were twenty years ago. There are "hybrid" customers who use each channel for informational/operational purposes.

From a category standpoint, there are differences - and modern customer behavior manifests itself via a category/channel interaction. One retail brand couldn't sell extended sizes in stores - not enough shelf space. Well guess what? Categories with a ton of extended size customers skewed online. Duh! From a marketing standpoint, take advantage of that information. Teach your customers where to buy various categories. Why are you sending emails to extended size customers demanding they shop in your store when you don't carry what that customers wears in your store?

Use category information to modernize your marketing tactics.

Old Man Yells At Cloud

Service Providers / Vendors play an important role in helping my clients achieve high levels of EBITDA (i.e. profit). They are like the maze of third parties that make it possible for Boeing to build an airplane. Take them away, and you don't have an airplane. Really ... really ... important.

When third-parties mess up, airplanes crash.

It is up to Boeing to make sure that third-parties perform at the highest possible level. When a third-party makes consistent mistakes, Boeing finds a new partner.

There are times when vendors make mistakes in our industry. Gonna happen. Unavoidable.

When I bring up the topic of vendor accountability, reader response goes something like this:

Mistakes are going to happen. Work carefully with your partners when consistent and similar mistakes continue. Encourage good performance. Your vendor partners are extensions of your employee base. Treat them as such.

Free Bacon

If you're gonna develop a category, do it this way ... free bacon (click here).

I had a two-hundred-slide-deck about seven years ago with these kind of ideas to generate awareness. Y'all HATED it. Didn't like any of the ideas. "That won't work for a brand with our sensibility."

Ok.

Well then what WOULD work?

Do you think Smithfield earned some awareness from this promotion?

A Completely Opposite Situation

Here is a repurchase analysis for Category 4. Tell me if you see any differences between this category and the one we viewed yesterday (Category 6):

11% ... just eleven percent ... of sales are generated from customers who bought from the category last year. Wow!

15% of sales are generated from customers who bought from other categories last year.

A whopping 74% of sales were generated from customers who were new/reactivated in the past year.

Describe for me your email marketing strategy if your desire is to grow sales in Category Six?

A Category That Owns Customers

In our study, here is a repurchase table for Category 6.

There is a lot of data to digest here.

Let's go right to the bottom of the table.

Category 6 generated 63% of sales from last year's category six buyers. It generated 11% of sales from buyers of other categories. It generated 26% of sales from new/reactivated buyers.

Once you know that a category generates most of sales from prior buyers, how does your email marketing (or if you are a cataloger, print marketing) tactics change?