Guest post by Alice Baker, Account Manager at Westgate Communications
It was a tragic day and a clear sign of the times when a British institution like Blockbuster finally shut it’s doors. I’ll never forget the day my mum took me into the store to purchase Beauty and the Beast (a classic I might add) on VIDEO for my Birthday; something she had to pre-order because it wasn’t available elsewhere. Clearly, I’m showing my age, but the memory still makes a distinctive point - we needed Blockbuster in our lives. Disney is very important to a five year-old.
Fast forward twenty years and I enter that famous store again, this time for another classic: Reservoir Dogs. “Sorry, we don’t have it” the shop assistant replied. Angered by her indignation, her shrug, and by the fact there were 47 useless copies of Bridget Jones’ Diary strewn around the store, I realised Blockbuster had finally become disillusioned by what its customers wanted. It was also clear that I no longer needed the store; for Disney or Tarantino, it didn’t matter. Streaming became the way forward and quite honestly, I’ve never looked back.
A dissatisfied customer I may be, but the point that it makes is that in the last five years the consumer power of our UK high-streets has now shifted from retailer to customer. Blockbuster no longer had what I needed - availability of films, knowledgeable staff etc. - so I went elsewhere. Understanding what your customer needs and what your USP is, is essential for maintaining customer loyalty. Adapting your retail channel to suit these needs is also vital because consumers appreciate retailers being considerate to their needs.
So who’s next to go? I’m hedging my bets - or should I say hopes - on WH Smith. Here is a store which epitomises all of the issues above. It’s expensive, it has no USP - does it sell books, sweet or arts and crafts materials? And the staff seem adamant on selling me a giant bar of Dairy Milk every time I purchase a lottery ticket. The staff are generally unfriendly and mostly unhelpful and their website seems to offer the same service too as its far from intuitive; so why oh why has it survived at the forefront of British retailing for so long?
As digital books sales with the likes of Amazon and Kobo continue to rise how much longer can WH look to hold on?
Showing posts with label customer retention. Show all posts
Showing posts with label customer retention. Show all posts
Monday, 25 March 2013
Monday, 7 February 2011
A groundbreaking Social CRM tool from Underwired
Until recently driving traffic to Facebook pages was the equivalent to old-style viral or word of mouth marketing, using it as a venue for people to engage with a brand. The evaluation of a campaign’s success was based on inference rather than end-to-end tracking – indicated by click-through rates, sentiment scores, mentions, ‘likes’ or Facebook transactions. However until now there has been no simple way of linking prompted Facebook activity to an individual customer’s record.
My company, Underwired, has just launched an sCRM tool which allows address-level tracking, the holy grail of social strategies. It closes the loop between the outbound customer journey and subsequent engagement, bringing relevant data back into the eCRM database. Underwired sCRM allows brands to employ social as part of a fully tracked eCRM programme that never loses sight of an engaged customer.
Underwired sCRM enables brands to capture social data, including an individual’s clicks on ‘like’ and ‘comment’ buttons, external links and video content (including how long they watch it for), photo upload, post and share with friends functions. For example, this means that customers who don’t spend much but have huge social influence can be identified and messaged appropriately, leveraging their real value. For the first time marketers can add an Advocacy dimension to their segmentation.
Making address-level tracking a reality solves an epic challenge for digital marketers, allowing them to pinpoint exactly who is doing what in their brand’s social channels and identify – and properly target – their most active brand advocates.
Social behavioural insight will be critical for marketers in 2011. By building Underwired sCRM into Underwired’s four week audit process, we can now include Facebook as an intrinsic part of a brand’s eCRM and email marketing campaigns. It means we can remove the final remaining blind spots in tracking ROI for online campaigns.
For further information, please visit www.scrm.co.uk
My company, Underwired, has just launched an sCRM tool which allows address-level tracking, the holy grail of social strategies. It closes the loop between the outbound customer journey and subsequent engagement, bringing relevant data back into the eCRM database. Underwired sCRM allows brands to employ social as part of a fully tracked eCRM programme that never loses sight of an engaged customer.
Underwired sCRM enables brands to capture social data, including an individual’s clicks on ‘like’ and ‘comment’ buttons, external links and video content (including how long they watch it for), photo upload, post and share with friends functions. For example, this means that customers who don’t spend much but have huge social influence can be identified and messaged appropriately, leveraging their real value. For the first time marketers can add an Advocacy dimension to their segmentation.
Making address-level tracking a reality solves an epic challenge for digital marketers, allowing them to pinpoint exactly who is doing what in their brand’s social channels and identify – and properly target – their most active brand advocates.
Social behavioural insight will be critical for marketers in 2011. By building Underwired sCRM into Underwired’s four week audit process, we can now include Facebook as an intrinsic part of a brand’s eCRM and email marketing campaigns. It means we can remove the final remaining blind spots in tracking ROI for online campaigns.
For further information, please visit www.scrm.co.uk
Friday, 3 December 2010
The nudge towards eCRM
ECRM is not a quick fix but requires sustained investment and patience, explains Felix Velarde, managing director at Underwired Amaze.
There are still some companies that haven’t understood the significance of eCRM (Electronic Customer Relationship Marketing). Yes, eCRM, that marketing nirvana, which comes with investment barriers that might make it impossible to buy. How could you turn down something that’s going to take a year to get right, that may cost a quarter of a million pounds but that might make you millions in new revenues?
It feels like an impossible proposition. It’s so difficult for brands to buy that many of them don’t. Those big innovators with money to burn can afford to experiment and reap the rewards, but most brands just can’t see it. Most brands have to focus on their immediate tactical requirements (sell, sell, sell!), and perhaps try social because they’ve heard they can do it for ten grand.
Most brands can’t afford to do eCRM, no matter how big the rewards, and how much it differentiates them from the rest of the market. Or can they?
Let’s go back a few years to when the first major eCRM campaigns started. In 2003 Underwired Amaze proposed to Virgin Holidays taking over an existing email newsletter campaign and building something more sophisticated.
The campaign became segmented, largely by behaviour to start with. What Customer Type 1’s preferred destination, time of year of booking, or decision making time was likely to be, informed when they’d get a special offer on a certain Florida hotel. Quite quickly the second dimension demographics came into play as well. Sending an offer for a free flight for your second child to parents of two made a big impact. The first segmented email sent generated £3million in direct holiday bookings. Virgin Holidays had taken a leap of faith and invested in a campaign that cost around £30k and justified a programme with an ROI of 100:1.
But once the initial surprise had worn off and customers got used to it, there was a long period of lots of detailed activity, lots of creative work going on, but not - it seemed - much return. It changed though, reached a critical mass after about a year, and finally the smiles started reappearing on the client’s faces. And stayed as the programme’s ROI three years later was still averaging 26:1. Fantastic.
The Virgin engagement went exactly like every other eCRM project. It started with a big bang that makes everyone very happy, and settles down. After a few months the quick wins have worn off and it starts looking like nothing is happening at all. After a long, long year though, the eCRM programme starts paying for itself again. But there’s this big, long, frustrating period of doldrums, where the project owner gets disillusioned and it all looks like very hard work for no return, and it’s this that I want to come back to. Why? Because actually it’s this period when the principles that really drive eCRM are hardest at work.
The first principle is segmentation, and if you will indulge me while I teach granny to suck eggs for minute it will set the scene for the second. Segmentation is based on a simple idea, that if you send a specific call to action (an offer, for the sake of this example) that is relevant to the right person at the right time, it’s more likely to be acted on than if you send it to the wrong person or at the wrong time. Let’s take an example. You have three hundred people, 100 are golfers, 100 football fans and 100 cricket fans. You have three offers to go see the Ryder Cup, the FA Cup and the Ashes, in an email, one after the other with a paragraph each. You send the email to everyone. 100 football fans will see the golf offer first, and a third of them will bin the email. The golf players will see golf first and be happy. The cricketers, well two thirds will bin the email before seeing the third, cricket, offer. Your maximum response rate will be 200 - because only 200 of the 300 recipients will have read the offer that appeals to them. Simple. Segmentation says, send one email with one offer to each group (yes, the right offer!), and your maximum response rate is 300 out of 300, a fifty percent improvement.
The second principle is the principle of the nudge. eCRM isn’t an advertising medium, it doesn’t work by bombarding people with messages until they buy - in fact, if you send too many emails it’s obvious what will happen: after the initial hit of increased response people stop reading, after a while they add you to their junk filter, and you never know because after too many emails they can’t even be bothered to unsubscribe.
The job of eCRM is to create relationships. So while the segmentation principle is important, it must be balanced against the need to create a relationship. What we want to do is change people’s behaviour subtly over time. Small calls to action, little asks, are what is required. I want every customer to spend a tiny little bit more every time. I want them to increase their purchase frequency by 2% over six months. I want a 0.1 percentage point increase in average transaction value. Why so little?
What the big innovator brands realised a while ago is that little nudges add up. If I suggest you double your turnover in two years you’d think it impossible. Yet if I suggest you increase it by 3% this coming month you might feel it’s much more realistic. And what happens if you increase your turnover by 3% a month for the next two years? The laws of compound interest say you’ve doubled your turnover. That’s why eCRM is, really, so compelling. Yes there’s a quick win, and yes, there’s a long dull patch, but patience pays off.
There are still some companies that haven’t understood the significance of eCRM (Electronic Customer Relationship Marketing). Yes, eCRM, that marketing nirvana, which comes with investment barriers that might make it impossible to buy. How could you turn down something that’s going to take a year to get right, that may cost a quarter of a million pounds but that might make you millions in new revenues?
It feels like an impossible proposition. It’s so difficult for brands to buy that many of them don’t. Those big innovators with money to burn can afford to experiment and reap the rewards, but most brands just can’t see it. Most brands have to focus on their immediate tactical requirements (sell, sell, sell!), and perhaps try social because they’ve heard they can do it for ten grand.
Most brands can’t afford to do eCRM, no matter how big the rewards, and how much it differentiates them from the rest of the market. Or can they?
Let’s go back a few years to when the first major eCRM campaigns started. In 2003 Underwired Amaze proposed to Virgin Holidays taking over an existing email newsletter campaign and building something more sophisticated.
The campaign became segmented, largely by behaviour to start with. What Customer Type 1’s preferred destination, time of year of booking, or decision making time was likely to be, informed when they’d get a special offer on a certain Florida hotel. Quite quickly the second dimension demographics came into play as well. Sending an offer for a free flight for your second child to parents of two made a big impact. The first segmented email sent generated £3million in direct holiday bookings. Virgin Holidays had taken a leap of faith and invested in a campaign that cost around £30k and justified a programme with an ROI of 100:1.
But once the initial surprise had worn off and customers got used to it, there was a long period of lots of detailed activity, lots of creative work going on, but not - it seemed - much return. It changed though, reached a critical mass after about a year, and finally the smiles started reappearing on the client’s faces. And stayed as the programme’s ROI three years later was still averaging 26:1. Fantastic.
The Virgin engagement went exactly like every other eCRM project. It started with a big bang that makes everyone very happy, and settles down. After a few months the quick wins have worn off and it starts looking like nothing is happening at all. After a long, long year though, the eCRM programme starts paying for itself again. But there’s this big, long, frustrating period of doldrums, where the project owner gets disillusioned and it all looks like very hard work for no return, and it’s this that I want to come back to. Why? Because actually it’s this period when the principles that really drive eCRM are hardest at work.
The first principle is segmentation, and if you will indulge me while I teach granny to suck eggs for minute it will set the scene for the second. Segmentation is based on a simple idea, that if you send a specific call to action (an offer, for the sake of this example) that is relevant to the right person at the right time, it’s more likely to be acted on than if you send it to the wrong person or at the wrong time. Let’s take an example. You have three hundred people, 100 are golfers, 100 football fans and 100 cricket fans. You have three offers to go see the Ryder Cup, the FA Cup and the Ashes, in an email, one after the other with a paragraph each. You send the email to everyone. 100 football fans will see the golf offer first, and a third of them will bin the email. The golf players will see golf first and be happy. The cricketers, well two thirds will bin the email before seeing the third, cricket, offer. Your maximum response rate will be 200 - because only 200 of the 300 recipients will have read the offer that appeals to them. Simple. Segmentation says, send one email with one offer to each group (yes, the right offer!), and your maximum response rate is 300 out of 300, a fifty percent improvement.
The second principle is the principle of the nudge. eCRM isn’t an advertising medium, it doesn’t work by bombarding people with messages until they buy - in fact, if you send too many emails it’s obvious what will happen: after the initial hit of increased response people stop reading, after a while they add you to their junk filter, and you never know because after too many emails they can’t even be bothered to unsubscribe.
The job of eCRM is to create relationships. So while the segmentation principle is important, it must be balanced against the need to create a relationship. What we want to do is change people’s behaviour subtly over time. Small calls to action, little asks, are what is required. I want every customer to spend a tiny little bit more every time. I want them to increase their purchase frequency by 2% over six months. I want a 0.1 percentage point increase in average transaction value. Why so little?
What the big innovator brands realised a while ago is that little nudges add up. If I suggest you double your turnover in two years you’d think it impossible. Yet if I suggest you increase it by 3% this coming month you might feel it’s much more realistic. And what happens if you increase your turnover by 3% a month for the next two years? The laws of compound interest say you’ve doubled your turnover. That’s why eCRM is, really, so compelling. Yes there’s a quick win, and yes, there’s a long dull patch, but patience pays off.
Monday, 27 September 2010
Parlaying custom into advocacy – why brands should be more pushy with their social media
It’s very rare that I get excited about a brand I become a customer of. I’m one of those people who really doesn’t engage with marketing. I’m probably not alone. And yet this is my territory, my metier – I work very hard to create engagement strategies for clients that can be demonstrated to work. I am, as it were, my own worst enemy!
So how do you, as a brand, engage me, as a disengaged person with what I’d consider to be better things to do with my social time than talk about your brand? I’ve been thinking about this in the context of two recent occasions where I have actually felt like praising a brand in public. The first occasion: on the way to a meeting I spilled coffee on my shirt. I was in the city, and I spotted a TM Lewin. I went in, bought a shirt, explained my predicament, and the manager arranged for the shirt to be pressed, in the shop, there and then. I went for a walk for five minutes and hey presto, new, unwrinkled shirt.
I tweeted about it when I got back from my meeting. TM Lewin’s tweetie person followed me and retweeted (quite rightly) my happiness with their service. Fab. The second occasion, this morning, my wife asked me if these were the shoes I normally wear with my suits. I told her they were from Loake, and that I can wak for miles in them – the very first pair of truly comfortable work shoes I’ve had. It crossed my mind to tweet that I love my Loakes, then I remembered I’m not that kind of person (so I wrote this instead).
Both are brands I’d of course love to work with. Both are brands that have built solid reputations for service and product quality. Did Loake sell me these shoes? I think actually I got them from Next, so which of those companies should be the one to do the customer engagement? And why?
One of the striking things about the TM Lewin experience is that very clearly several people from TM Lewin now follow me on Twitter (no idea what they get out of it, but feel free – twitter.com/felixvelarde), but nobody’s ever been in touch. I am clearly, or at least I was once, a brand advocate. I spread the word, in a credible, completely unprompted way. But no-one has since asked me if I’d like to join a loyalty club, or corresponded with me on Twitter or otherwise to find out how to make sure I continue to be an advocate. It’s unpushy, which is nice, but it misses an opportunity. TM Lewin’s social media strategy needs a tweak or two.
And the fact the brand doesn’t have an eCRM programme is quite surprising – all of its customers are repeat customers, we have to buy similar products regularly, we have preferences... TM Lewin could take a leaf out of Pink’s book and keep our sizes on a database, offer us things they already know we want. And so on. The opportunity to create an engaging, relevant and pretty much self-managed eCRM programme should be too good to pass up. And by creating engagement they’ll be parlaying an initial positive first impression into serious loyalty and further opportunities for advocacy.
Someone like me, who doesn’t actively engage, who almost never spontaneously advocates a brand to his friends and acquaintances, might be driven to do so more often. Certainly, I could become a very loyal customer. Since my experience I’ve bought shirts from TM Lewin, though I also buy from Pink, Hackett and others. I could be engaged more, to their exclusion. The next time I think about shoes, I will probably be thinking about buying some Loakes, though because I’m not in their eCRM programme either I have no idea where to start. Perhaps I’ll start with Next. I really can’t remember if it was Next - if not then Loake might lose the sale while I’m wending my (possibly easily distracted) way to their brand – so again, here’s an opportunity.
Brands must – must! – engage with their customers. The best brands, the ones that provide fantastic service, or fantastic products, are the ones that must do so even more – they have an opoprtunity to cement their customers after the first great experience in a way that only becomes more dilute as time goes by. It’s an opportunity that must not be missed.
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