Winning or Losing the Minds, Hearts and Wallets of Our Customers

Over the weekend, I made a trip to the mall with my wife to the Cole Haan store. Last year I bought my wife a purse from Cole Haan for over $500. and after only having used the purse about 10 times in a year, the strap is beginning to fall apart. I figured since I spent over $500 on this purse, which has not been abused, I should see if Cole Haan will do something about it. The sales associate was extremely curtious and understanding. Without hesitation, she said it is obvious there is a flaw in the strap, thus we will gladly repair it for you and apologized for the inconvenience. I was quite impressed with the associates handling of this situation. She did not even look up my previous purchase history, which is several thousand dollars, nor did I have to tell her that I was a frequent shopper having spent several dollars over the years.

This is an excellent example of good customer service and a company that empowers its associates to make the right decision for the company and the customer alike. This is an act that will not go on unnoticed by me. In the future, I will certainly not hesitate to continue to shop at Cole Haan.

In these difficult economic times, it is vitally important that other companies take note of this type of behavior. It is very expensive to acquire customers and it take a lot of work to move customers from being uncommitted to being loyal. Customer loyalty is not about having the best price, in most instances. Those customers who shop just on price are typically not your most loyal customers. These customers, are merely transactors who will not hesitate to defect for a competitor who offers a better price.

There are a number of examples of companies who do a good job of differentiating themsevles against their competition. Their differentiation in on service, those little extras, or better trained associates, coupled with a strong in stock position if it is retail. or personal recognition of customer behavior orchestrated through an effective one to one marketing campaign based upon your purchase behavior and preferences.

Many companies are focused today on cutting costs to make it through the other side of these tough economic times. I submit to you, it is the companies who keep their customers first that will service and continue to win the minds, hearts and wallets of their cherished best customers, as well as dong the best job at converting uncommitted customers to best customers.

I have had the good fortune of working with, and being a customer of many companies who do an outstanding job of putting the customer first. It is a part of their corporate culture, from the CEO down to the sales associates, or waiters, or flight attendants. Those companies who do a good job know who they are, but they can all do better. I am not going to make this post about who else is doing a good job. If anyone is interested in my list of who is doing it right, feel free to email me and I will respond to you directly. Additonally, I am not going to out the companies who are not doing a good job, or those who have gone from good to great to gone or soon to be gone, I think they know who they are as well.

If you find a company who does a good job like Cole Haan has, return the favor and tell your friends and continue to open your wallet in their stores rather than going to a competitor. If you show loyalty to a company and they do not show it back, you are certainly free to flee. If you are trapped because there is not another company that provides the goods or services you need, let them know. Most companies, the good ones anyway, want to here from their customers; the good, the bad and the ugly.

You do not have to spend a lot of money on a product or service to expect good service in return. It can be as simple and inexpensive as a newspaper on a street corner or a coffee at your favorite coffee shop. The point is, these are competitive times and companies need to work hard to provide customers with service that wins the minds and hearts of their customers, which will translate into maximizing the customers share of wallet. When companies we engage with make an effort to win our minds and hearts, we should return the favor in kind by being loyal to them. There is a great old Midas commercial that says “pay me now or pay me later”. This is a two way street. If companies treat us poorly it will cost them lost customers and revenue; conversely if they treat us well and provide the products and services we seek, we will reward them with our business. If we leave a company that has treated us well to save a few dollars, what happens when that company goes out of business or if you have to return a product and they are not accommodating. The few dollars you saved are lost in spades. Companies and customers alike, think about the end to end life cycle of the value of committing to each other.

Thanks Cole Haan for going that extra mile for me, I will be back soon and hopefully so will my friends.

How Retail Must Evolve as an Industry to be Relevant to Customers

Retail Store of Tomorrow . . . Today! | Networlding.

I reviewed a blog post today from Melissa Giovagnoli, the Founder & President of Networlding.  I think she has really hit on something with her concept of a Networlding Genius Bar.  With social media becoming much more pervasive and widely used around the globe, it is certainly a concept that is coming of age.

We have seen an explosion of User Generated Content, on-site product reviews and online survey tools over the past few years.  The world is evolving to a new level of two way communication.  It is no longer just about push and/or pull marketing, but a real and deeper relationship with your customers.  In order to have that relationship, you must invite them to the conversation and allow them to say what they want, when they want, where they want.  You cannot filter out the good from the bad, nor can you simply ignore the bad.  Many consumers look for reviews on products, services and companies today before making their purchasing decision.  Their decisions are rarely based on price alone anymore. It is more about the customer experience as they are seeking the whole package, including companies that understand them, treat them well, and obviously have what they are looking for. Please take note of the fact that I said customers above. There are many buyers who still purchase on price along, but they are mostly bottom feeders who you will not have a long term and profitable relationship with. The key is to get it right with the 20 percent of the customers who make up 80 percent of your revenue. If you get it right with them, through the use of word of mouth, they will invite others to the dance.

Now that you have read my pre-able, and hopefully read Melissa’s post from the attached link above, I am going to take a slightly different spin and focus on what senior retail executives should be locking themselves up in a conference room to begin white boarding to develop strategies for including social commerce and a 360 connected engagement with their customers into their marketing and brand strategies beginning immediately.  It time more retailers of all sizes, shapes and types begin to not only embrace it, but use social media and commerce as a competitive advantage. We have never had access to so many robust tools that enable us to have a two way dialogue with our customers that can foster truly deep and meaningful relationships.

Apple has done a brilliant job engaging with their customers in a friendly and informative way through their overall retail experience and in particular the Genius Bar.  They have created a cult following.  The Apple store experience is superb and something others should take notice off.  They continue to innovate from a product, store experience and distribution perspective.  They have really mastered the art of bringing the brand alive in everything they do, through a consistent and high touch customer experience.  Whether you are a buyer of an iPod, a MacBook Pro or an iPhone, you get a high touch experience within the Apple store and if you need help, the Genius Bar is on site to address most of your issues.

I submit to you, the new retail imperative is the need to introduce social networking and commerce into the shopping experience across all channels. You need to bring some of the new online social networking and engagement models into the store experience.  This can pay dividends in that it deepens the relationship and engagement with customers, while also creating a community which enables the community members to connect with one another and generate their own content.  This would be analogous to the developer communities that are so busy building app’s for the iPhone and other companies/devices. Connecting with your customers 24/7 in a 360 degree fashion will make you more relevant with your customers, by being there when they want you in a seamless and channel agnostic manner. This will lead to and re-enforce the deeply connected relationship you want with your customers.

Additionally, stores should leverage the data they have on their customers to help aid in the browsing and shopping experience even more.  They can use predictive modeling to assist in suggestive selling based on profile data, purchase history and store visits.  Shoppers should be able to use a devise, such as an iPhone, to log into their profile while in a store to “like’ items, as well as tracking items for future sale events, etc.  This would give the retailer a better glimpse of the customers intent to buy.  This data can then be used by the retailer to generate one-to-one communications and promotions for customers.

With GPS tracking being so pervasive today, why not use it to your advantage, as a retailer, to monitor shoppers and their browsing habits.  Here is a wild idea, that I think could be a real differentiator:

As part of a loyalty program, create a community that allows customers to connect to one another, as well as to the retailer.  Let them all have a conversation where they can ask each other for input on questions they have pertaining to a future purchase decision.  They can get some of this today through online product reviews.  Take it a step further and let them access this from within the store.  Take that a step further and allow customers to be tracked when in your retail store with a home grown or licensed app like Loopt or Brightkite.  You can have someone in command central within your store that is monitoring customers who are in the store and also tracking associates to see if they are helping the customers, because they will be tracked also.  Each co-worker can have a handheld devise that enables them to see when customers from their loyalty program are in the store, click on their profile and review product recommendations within the section of the store they are shopping, based on category modeling that has already been done in the background and just waiting to be used when the customer enters the store.  Just think how much brighter your sales associates would seem.  You can also improve your modeling down the line by comparing the recommendations made to what the customer actually purchased.

Additionally, you can allow the customers to create something similar to a wedding register in which they can click on an item bar code to put it in their wish list for future purchases or to share with others as potential gift items.  Associates would be able to see this the next time the customer comes to the store and do suggestive selling against it. You could ping customers with special one-to-one offers when they are near your store, or in your store, based on what they have “liked” or purchases in the past. Make it real, make it relevant and make it right now, with a strong call to action and limited time offer just for you! Use your customer data and your technology to create a one-to-one conversation that is highly relevant, rather than just being a recipient of a one-to-many saturation mailing to drive store traffic. The more you can make it about me, the more likely I am to feel connected.

GPS tracking within the store would also allow the store to see how much time customers spend in the store, where they go in the store, if and what they buy.  This is essentially a brick and mortar retail version of Tea Leaf.

Lastly, with Facebook now having in excess of 200 million users, why not have your own Facebook page to create the community experience. Have a similar section on your website. Have store associates ask customers if they would like to friend your brand. Additionally, get them engaged with Twitter and have a team within your organization manage an effective and meaningful communications strategy across these and other social platforms. It is not just about being there, it is about being relevant, always on and engaging in the right way, based on the spirit and meaning of your brand.

Give this some thought and have some fun with it. I guarantee you that you will have to be here eventually. The social conversation is not a passing fad, it is a new way of being. Therefore, be bold, be early and be relevant.

Fun Not Fear… A Very Cool and Important Social Experiment

If millions of people recycled the fear gripping our world economy into something more positive, who knows what we could create?

I am working on a very cool social experiment on Facebook called Fun Not Fear, which can be found at http://www.tinyurl.com/funnotfear.  This social experiment is the brain child of Phil Terry, CEO of Creative Good.  You can read more about Phil’s impressive bio at http://tinyurl.com/PhilTerry.

I will tell you more about Fun Not Fear in a moment, but let me give you a bit of background on how it got started.  Phil, the crazy ideator that he is, decided to start a social experiment on Facebook to celebrate the birthday of the 150th birthday of Charles Darwin on February 12th.  Leveraging the power of viral marketing and the network effect, Phil and his team were able to grow members of this social experiment from a mere 400 people on January 29 to 200,000 members on February 12th, Darwin’s birthday.  Since that time, the membership has continued to grow and a new goal has been set to reach 1 million members by November 24.  Talk about the art of the possible.

The Darwin experiment, http://tinyurl.com/DarwinExperiment,  led to an even bigger idea, which is Fun Not Fear.  The goal for this experiment is much more aggressive than the Darwin experiment – 123,456 members by April 1, 2009, which is a mere week away.  Just like the Darwin experiment, Fun Not Fear will achieve its goals through the efforts of its members spreading the word serving as connectors and boundary expanders.

The Fun Not Fear experiment has a very simple premise…  Creating a playful campaign to combat fear.  This is a particularly relevant topic in these difficult economic times where people are concerned about their livelihoods, from their jobs to their homes, retirement and so much more.

As stated on the Fan page for Fun Not Fear on Facebook:

With the broad economic crisis, there’s a lot to be fearful about in our world today – yet neuroscientists teach us that chronic fear clouds the mind making it difficult to think and act wisely. So, can we take the energy from fear and turn it around into something positive – something that can bring people together in these difficult times?

To date, we have been able to grow our membership to just over 4200, which is well short of our goal of 123,456 by next Wednesday, April 1.  I am hoping you will help by joining yourself and forwarding on this blog post to your friends and family.  We are not stopping at 123,456 as our goal, we have set an even greater stretch goal to achieve 128 Million members by January 30, 2010.  Be part of what could be one of the coolest and most amazing social experiments happening today.

Please use the power of your network to help us, this is an incredibly worthy cause.  The volunteers working on this campaign have incredible life stories.  One of our volunteers is a cancer survivor and attributes the power of laughter and fun to her continued recovery.  She even signs her emails with “Have a Fun-nominal Day”

As part of this social experiment, we are posting a Book of the Day, Good News of the Day and a Quote of the Day on Facebook to share with the Fun Not Fear community and all those indirectly connected as part of our Facebook, Twitter and other social networks.  In addition to these posts, there are numerous other submissions made by members of this experiment.  We invite you to be a content contributor as well.  I have learned a lot over the past few weeks by reading many of the posts.

We are not just looking for warm bodies, but rather advocates who believe is the spirit of fun and want to do their part to help others to overcome their fears, while also letting the submissions of others help you with yours.  If you are a parent, there is some great stuff to share with your children.  If you are an educator, there is great content to use in the classroom.  If you are a mere passenger on this spaceship earth (wow… where did that come from, stream of consciousness, but I am going to leave it as I am on a roll), we can all benefit from participating in this social experiment.  This is not something just for a day or a week, but something to think about in your everyday life.

Don’t let stress and fear have a grip on your life, learn to have fun in all that you do.  Learn to laugh in the face of adversity and learn how to share that new gained knowledge with others.

If you are still with me through my rambles, we have a special event coming up on April 1 which all our members are invited and encouraged to attend.  Phil Terry has been able to set up a very cool webinar for April 1 at 5 p.m. Eastern Standard Time.  One of the special guests for this webinar will be Bob Mankoff. Bob is the cartoon editor of The New Yorker and an expert on the serious business of humor and play.  There will be some great conversation during this webinar, to be sure!

If you would like to participate in the Webinar next Wednesday evening, you can click on the link below.  Citrix has donated all of the webinar facilities for this and future webinars.

Sign-up for the Fun Not Fear webinar featuring Bob Mankoff:
https://www1.gotomeeting.com/register/409237164

I will leave you with this closing thought from our Fun Not Fear Fan page:

Fun, play, humor, creativity, and foolishness are seriously important and, if millions of people recycled the fear gripping our world economy into something more positive, who knows what we could create?

Sign up today and tell your friends…  so they can tell their friends, who will tell their friends and so on and so on…

Join Us Today:  http://www.tinyurl.com/funnotfear

Please Sir, how do you re-tweet? – Twitter to be taught in UK primary schools

Please Sir, how do you re-tweet? – Twitter to be taught in UK primary schools .

A brilliant move by the British government to consider making online communication and social media a permanent part of the U.K.’s education system.

We are living in an always on, connected global society today in which connectivity plays a critical role in human and social interaction, as well as commerce and government for that matter.

Children should start at a young age to appreciate this and understand it.  They should be taught the importance and power of social media, as well as how to best go about crafting their personal brand.  Most of what we do today is searchable on Google.  There has been a lot of intentional and unintentional misuse of the medium which has caused people to lose their jobs or make retractions of embarrassing statements or actions.

Teaching children, from an early age, how this works and how it will impact their lives is an important step.

This is lead to more social interaction, better communication skills and a much needed proficiency in technology.  Embracing this rather than trivializing it will go a long way.

I look forward to following this development and hope it comes to the U.S. soon!

Source: Office Depot Associates Routinely Lie about Notebook Stock

Source: Office Depot Associates Routinely Lie about Notebook Stock.

An example of doing the wrong things, putting margin ahead of customers.  I get that laptops are a lost leader, but you cannot penalize your customers and give them an excuse to go to the competition.  In many instances, accountants focus too much on the numbers, not realizing the implications on customer LTV. Hourly associate performance based compensation, coupled with strict mandates from the bean counters can lead you down the path of the dead pool. Wake up Office Depot, don’t forget what happened to Circuit City when they fired all of their most experienced sales associates in exchange for cheaper and less experienced bodies.

Rather than avoiding a sale with zero or negative margin, or penalizing associates for selling products with no margin, why not focus on the positive and reward the for up-selling and cross-selling.  If you do not want to sell laptops at a loss, get out of the business.  It is the nature of the beast.  You don’t find the margin in the laptop, but the accessories and services you sell along with it.  More importantly, where you make your money is in establishing a long term relationship with your customers.  That relationship is based on the little things which amount to a lot:

• Exceptional value
• Extra-ordinary service
• Customer empathy and passion for what you do
• A Customer First mentality
• Letting the Long Tail drive your short term behavior
• Winning the hearts and minds of your customers at every point of engagement

To win the war in retail, you have to plan out your battle strategy.  The strategy must have an end state goal of winning the war.  Winning one battle, without planning for what’s next will lead to your defeat.

If you want to charge more than your competition, you must provide something more in the way of service, convenience, product availability, a meaningful loyalty program or something else you feel is on par.  To say you are out of a product gives your customers a reason to go to your competition and never come back.

See the big picture guys or your customers will show you the door.  Just the fact that an article like this is written about you is bad enough.  What are you going to do to remedy the allegations.  You can’t bury your heads in the sand, you need to change your orientation and start looking through the right end of the telescope to see beyond the short term.

My Strategy for the Sony/Google Challenge to Amazon’s Kindle

Sony, Google Challenge Amazon – WSJ.com.

This is a recent story about Sony and Google partnering up to challenge Amazon.  What Sony needs to do is follow the successful strategy of Lexus when they came into the U.S. market to challenge the luxury car incumbents.  Lexus focused on the customer experience, providing elegance at an affordable price.  They were not trying to step down and give middle and lower class americans a luxury car they could afford, but rather provide a luxury vehicle that could rival Lincoln, Cadillac, Jaguar, Mercedes and BMW at a much lower price.  These cars were elegantly appointed with comfort, style and standard features far beyond what you would get in the above mentioned brands.  Additionally, the purchasing and services process were very simple and hassle free.  They did their research and attacked all the pain points of the owners of other luxury brands.  Many people decided to give Lexus a try, not me though as I have always been a BMW loyalist, as either their second or sometimes primary luxury vehicle.  Where Lexus excelled is in substantially raising the bar on repeat purchase rates.  Customers were blown away with the ride, the quality of the vehicle, the fact that they had far fewer repair issues than their competitors.  As Lexus increased their share in the market, they were able to raise their prices and not lose customers, while also continuing to steal share away from their competitors.

Sony is in a fairly similar position in that Amazon is the category leader with a first movers advantage.  What Sony has going for it, however, is the fact that they are not entering into a mature market, but rather an emerging category where there is plenty of opportunity.  Amazon has snagged the early adopters already, who will help propel the Kindle forward through word of mouth and repeat purchases, just as has been the case with the iPod.  Sony certainly wants to avoid letting Kindle gain the significant competitive advantage that the iPod has.  iPod has watched many wanna be competitors come and go.  iPod is a great product and has its direct linkage to iTunes, where songs cannot be exported across other devices, thus making switching costs very high.

Sony’s partnership with Google is brilliant in that it can help to minimize the current advantage the Kindle has of being owned by Amazon which provides a simple and seemless ordering experience, as well as being the current leader in convincing publishers to make their books available for electronic distribution through the Kindle.

It is my believe that eventually, the Kindle, and whoever else emerge in this space, will replace many printed books.  We will begin to see students use them in school, as well as other new business models popping up where travelers will be able to rent a kindle for a flight or cruise or other travel event and download content on their rented device.

Early on, Sony needs to prove it is a viable contender to the Kindle.  They need to made their product available at a below market cost to convince consumers to give it a try.  I am sure there is some fear that Sony may not stay in the space, thus they would rather go with the Kindle because they know Amazon is in this for the long haul.  We need to see the Sony product in the hands of people.  If I were Sony, I would send it to leading bloggers, executives and other influencers who could help Sony to gain share.

Just like with Gillette, they switched from being in the razor business to being in the razor blade business.  Sony should not focus so much on making money initially on its device, but rather the revenues from the downloads.  You never get a shot at the download revenues if you do not have devices in distribution.

My challenge to you Sony is to break from the traditional product entry strategy.  Use your creativity, ingenuity, and the combined brand cache of Sony and Google to give the Kindle a run for their money.  I would be happy to set my Kindle aside and try your product if you want to use me as a test.  You need to find your core and then run with it.  Make some noise, let people know you are in the game.  Turn up the volume Sony and get this one right like Lexus did and not wrong like Microsoft and Dell did against the iPod.

MAKE US AN OFFER WE CAN’T REFUSE

Sony Reader product page: http://tinyurl.com/2za2ru

The Right Formula For Grabbing Market Share in a tight economy

The Right Formula For Grabbing Market Share in a tight economy.

In these challenging economic times, the attached approach for grabbing market share is certainly worthy of consideration.

An excerpt from the opening paragraph of the attached article states “When most people see the symbol CO₂ they think of the acidic oxide. According to many sources, CO₂ in concentrations of 7% to 10% can cause dizziness, headache, visual and hearing dysfunction, and unconsciousness within a few minutes to an hour.”

The authors of the article took a slightly different spin on the properties of CO₂. “C=02. This business formula signals that Chaos equals Opportunity to the second power. What better time for a company to grab market share than when there is a sense that their competition is on their heels. Strong, well positioned brands are always looking for an opportunity to grab their share of the market – there has never been a better time than now!”

Much of the news today is consumed with bleak economic data.  Many companies are going inward, cutting CapEx, laying people off, cutting “discretionary” spending and waiting for the economic downturn to pass.  This is a certain formula for disaster and an express ticket to the dead pool.  What is most important today is to use these times to not cut expenses and staff indiscriminately, but rather to put everything under the microscope to cut those things that never really made sense, but made their way into your operating budgets when you were flush with cash and your investments were returning healthy returns.  Everything else must stay and be used for you to create a battle plan that will ensure you are victorious over your competition.

We are in a period of economic correction people!  This is a natural business cycle, which, at the moment may feel like a free fall from 30 thousand feet.  I do not wish to minimize the severity of this economic downturn, but this is not a time to forget what made your company a world class brand or a company on its way to greater things.  You must continue to invest in the important things that will make your customer continue to choose you over the competition.  You must continue to be strategic and to innovate.  You must put even more emphasis on doing the things that are required to win the minds and hearts of your customers, with a focus on doing things better, faster and cheaper.  This is a time to leverage the data assets you have.  Use the data to drive the insights which will help you to devise the best possible battle plans to gain share.  You must exploit every weakness of your competition and strengthen your most important assets.  If you data suggests you should be trying some new things to gain share, by all means test.  Test often, using this time to strengthen your position.  If you fail, fail quickly and learn.  Get yourself back on course and positioned for a stronger market position.

Be smart, be bold, be strategic, but most importantly, be the things that are most important to your customers.  Don’t forget about your guiding principals, your mission statement and your key points of differentiation.  If you see your competition pulling back, don’t follow their lead, go grab share and make certain you give your new customers what your competition could not or would not deliver.  It is not about slashing prices, it is about providing value.  Value is a multi-dimensional equation that encompasses price, product, promotion, assortment, service, trust and a open two-way communication with your customers.

If you are on the service side, spend more time with your customers to better understand their pain points.  What do you need to do to re-invent yourself to be responsive to how your clients are changing their business.  Are they looking to outsource more services, are they looking for better technology that reduces costs and cycle time, etc.  These will serve as signals to where their heads are and if they get the concept of C = O x 2.  This is a time to be a value added strategic partner more than ever.  Companies can fire vendors, but they are less likely to fire value added business partners that provide a strategic differentiation to the competition that translates to increased revenue, margin and ROI.  If you have clients who do not get C=O2, which I am sure you do, take the time to explain it to them.  Help to minimize their fears.

We are in these turbulent times for the balance of 2009 and most likely the first half of 2010 so strap on your seat belts and pull them tight as it will be a bumpy ride, but it is not the end of the rode.  Those who see opportunity to the second power in this chaotic time will come out on top, stronger than those who make cost cutting their primary objective in hopes of just weathering the storm.

Take the challenge, thrive on chaos and find your opportunity to the second power  C = O x 2

My 30,000 Foot View of Web x.0

I have been having many conversations of late with clients and friends about the evolution of web commerce.  I have been on the multi-channel marketing scene for over 20 years now and have watched the evolution.  When I was a teen or in my early twenties, I often heard from my parents about all the things I have which I take for granted that were not even on anybodies radar screen when they were younger.  The young rock stars of Web 2.o are doing some cool stuff which was not even imaginable 20 years ago or longer.  The reality is Moore’s Law is being challenged and new technologies are advancing more quickly.  Innovation is the key driver, along with an insatiable desire more content and control.

It is no longer about either push or pull marketing, but rather about collaboration, transparency and user generated content.  If you are not giving your customer what they want, someone else is waiting in the wings to steal them away.  Customer Loyalty is defined by stickiness.  Stickiness is defined by a transparent customer experience which makes customers want to engage with your product or service and telling their friends.  With great companies like BazaarVoice, customer reviews are becoming an ante for being seated at the big kids table.  Today we see a proliferation of social searches on Twitter and Facebook where people are asking close personal friends, Facebook friends and Twitter followers for advice and information.  Just yesterday, Robert Scoble said he was in the market for a new mini van for his wife and asked people on Twitter to tweet their opinions on a few different mini vans.  This is the future of social search.  Consumers will give you and others their opinions about your brand, good or bad, whether you want it or not.  The key is what you do with it.  Ignoring customers is a sure bet to share erosion in the future.  It is essential you embrace the two way connectedness being created on the web.  Whether you think you are a participant or not, you are, both personally and professionally.  I love the way Best Buys CMO uses both his blog and Twitter to engage with customers.  He has people tweeting him about stuff they like, as well as things they are not happy about.  He is transparent in his replies and ignores no one.  This is also done very effectively by the CEO of Zappos.  In web 3.0, this will be the rule rather than the exception so you better get some people assigned to following these guys and figuring out your own strategy.

In the early days of the web, Web 1.0, there were many retailers who wondered what they should do.  When should I get in, what should I be doing, how much should I spend.  Many companies figured out that Wall Street was rewarding those with a web presence, thus they began to shift spend and attention away from brick and mortar to web commerce.  Companies were splitting off their web divisions as different companies and the dotcom era of Foosball, pool, beer and pizza was created.  It was the cool place to be.  The dotcom crash occurred and things began to come back to normal, but it was a new normal.  Multi-channel retailing was part of the new normal and companies needed to figure out how the various channels, be it dual or tri, could and should best co-exist.   There is not a best practices guide, per se, however what has evolved is the need for companies to be channel agnostic, always on and provide a seamless, consistent experience for your customers.  Not many are getting this right yet, but they are moving in that direction.  The other thing that evolved with web 1.0 is the pure plays like Amazon who have been able to not only break rules, but create new rules where non previously existed.  Amazon is all about putting the customer first and using rich customer data to improve the customer experience.  Another winner in this arena has been Zappos.  These are two companies that have achieved annual sales in excess of $1 billion+ through a retail channel that did not even exist 20 years ago and they got there faster than any other traditional retailer.  What sets them apart, and makes them both a model to follow, is their commitment to customers, innovation, transparency and collaboration.  Their business models are different, to be sure, but the drive, passion and commitment to be category leaders and innovators is unmatched.

Web 2.o was in large part started by the likes of Facebook, Digg and other social media business models which have made participation and user generated content mainstream.  People have been freaking out of late about the newly launched site design of Facebook, but the jury is still out.  For the most part, I am a fan.  It is taking a bit of time to adjust to the increased noise from the various feeds, but that will settle itself in time.  Facebook did the right thing, however, in the next step of innovating and shaping its business model which will become a powerful commerce engine and source of rich social content, reviews, opinions and so much more.  Nobody understood what blogging was all about, outside of Silicon Valley, just a few short years ago.  Now we have powerhouse blogs like TechCrunch and Mashable to name a few, as well as the newest entrant to the party, Twitter in the form of micro-blogging.  Twitter is being embraced by celebrities, news anchors, professional bloggers and now every day people.  It was just announced today that SalesForce.com is partnering with Twitter to incorporate relevant tweet streams into their enterprise client solutions in an effort to monitor customer views, opinions and feedback.  This will be very powerful and a key point of differentiation for companies that rightfully embrace the notion of listening and engaging with their customers.  I read recently, in my tweet feeds, that people are starting to think in terms of 140 character thoughts and phrases.  This is a good thing, as it forces us to get to the point crisply and succinctly.  Isn’t that what it is all about.  We have a few precious seconds to get the attention of our audience.  How do you say something impactful in 140 characters, many have or are figuring it out.  To me, Web 2.0, is about the conversation.  It is about transparency.  It is about giving people control of what and how they receive content.  It is about user generated, user throttled and user filtered content.  We decide WHO we want, WHAT we want, Where we want it, When we want it and How we want it.   This is brilliant.  We see great new web companies by web experts being created to give us just that.  A few examples are Alltop.com by Guy Kawasaki and SocialMedian.com by Jason Goldberg.  Both have been successful with previous web ventures and are sure to be on the forefront of creating even more new brilliant business models and ideas in the future.  In web 1.0, it was about being channel agnostic.  In web 2.o, it is about being device agnostic.  Mobile commerce and communication will be ubiquitous in web 3.0.  You will need to figure out how to be there for your impatient customers when and where they want you or someone else will.

Web 3.0 is going to be about bringing it all back together again; introducing two key elements which are just now being dabbled with in Web 2.0 – measurement and monetization.  The who, what, where, when and how need to be understood and analyzed, ultimately resulting in insights which create a path to monetization, whether it be products, services or ad revenue. But, as in web 2.0, unlike  web 1.0, the customer must be at the center of the decision-making process.  Chat groups, Twitter, Facebook and other have made it unavoidable to be part of the conversation, engaging, transparent and on your game 24/7.

In another 20 years when my kids are my age and potentially pondering these same types of issues with an entirely different innovators dilemma’s, it will be fun to sit back and say to them, well you know when I was …

I hope you enjoyed my post from 30,000 feet, I welcome your comments.

Coupon Innovations: SMS Push Strategy Being Used By Kroger

Finding Coupons Online Has Increased to Stretch Grocery Budgets – WSJ.com.

At a time when consumers are cutting back on spending, and trying to make that which they spend go much further, Kroger is once again embracing innovation and technology to sustain its leadership position in the grocery space.  It is no surprise that Kroger continues to deliver stellar results to its shareholders as they always find ways to surprise and delight their customers by embracing and activating change.

Mobile marketing and SMS are something which many companies have talked about, but Kroger is one of the companies doing something about it which will pay dividends.  It is not just about activating a mobile strategy, but activating the right mobile strategy.  Kroger has been testing an SMS push strategy for the deployment of its coupons and will soon be rolling it out.  The coupons are pushed to customers via SMS, which are then loaded to their loyalty card for easy in store redemption.  This avoids the hassle of having to clip and carry paper based coupons and creates customer stickiness.  There are some exciting things Kroger can do in a later phase of their roll out, including pinging customers in store as a reminder to purchase the items that have received coupons for.  Additionally, they can add other cross sell promotions based on behavior and shelf adjacency.  Kroger has been brilliant in their strategies and innovation, thus I am fairly certain there will be many more advancements in this strategy, without over complicating the process or confusing the customer.  It is always best to crawl, walk, run.

The statistics for electronic coupon usage and redemption suggest this is a strategy that more companies should begin to incorporate into their marketing mix and loyalty programs.  Today online coupons only represent 1% of all issued coupons, but their usage is growing rapidly and redemption is up 140 percent year over year.  The key to increased redemption is less about the channel and more about the relevancy.  Those companies who are beginning to embrace electronic coupons are advocates and converts to one to one marketing.  Kroger is a leader in the grocery space, which can be attributed in large part to the effectiveness of their loyalty and couponing strategy, which will further be enhanced by the convenience of electronic deployment.  As smart phones become more pervasive, shoppers will be able to build their lists on their computer and push it to their phones and match items to eCoupons, or do it directly on their phone like my wife (but unfortunately we do not live in a state which has Kroger or other sister brands, thus we don’t get the benefit of participating in their loyalty program).

Kroger has embraced the power of customer data and continues to innovate their business, embracing technology to connect directly with their customers in a relevant and one to one manner.  This is not just a win for Kroger, it is a clear differentiator with Kroger customers who have often said that Kroger really knows their shopping habits and continually delivers relevant coupons based on what they buy, rather than being like most other grocers and retails who subscribe to a one to many saturation approach for their coupon programs.  A third critical participant and winner in this strategy are the CPG companies who work closely with Kroger, participating in the couponing matrix strategy based on customer behavior.  This is another success story, worthy of another blog post at another time.

My hat is off to Kroger for its continued innovation and continued belief that customers should be at the center of the decision making process.  Through their key partnership with dunnhumby, a global consultancy that has perfected the practice of using customer data to drive insights which lead to action, Kroger has continued to differentiate itself with its customers, winning greater share and delivering an impressive string of year of year earnings growth which they have directly attributed to how they have embraced their customer data to drive insights which have reshaped their strategy!  In these difficult economic times, more than ever, data is king and more companies should take a page out of Kroger’s playbook.  It is not acceptable to cut marketing budgets across the board or cut programs you do not like, but rather a triaz of your customer data should be performed to determine where you are getting ROI for your spend and where you can prove value.  This is not a time for keeping pet projects with soft benefits which cannot be proven as meeting a clear and measurable objectives.  We are entering into a new marketing era where accountability is more essential than ever.  A lot of what worked in the past, or could be sold as having value, is either not working or at risk.  This is not a short term situation, thus as marketers we must be strategic, accountable and put customers at the center of our decision making process, using the rich data that sits in our databases.

Business and Financial News – New York Times

Business and Financial News – New York Times.

There are many CEO’s, and other C-Level Executives, who have been compensated handsomely for delivering exceptional results and returning above average returns and dividends for their shareholders.  In the current state of the global economy,  it is hard to justify such excessive packages from MOST, but not all executives.  I have always been a fan of Steve Jobs for his posture on compensation where he has real skin in the game, having worked for $1 and amassing his fortune through stock.  Under the leadership of Jobs, Apple has performed remarkably well over recent years, generating more than its share of millionaire co-workers and making a lot of money for individual and institutional investors alike.  The leaders of the auto industry, on the other hand, have lavished themselves in compensation packages that are not commensurate with the results they have delivered to their shareholders and co-workers.  Where is the equity, where is the responsibility.  Many CEO’s have their Board’s in their pocket as they scratch each others backs.  It is time for change in corporate america, and elsewhere around the globe.  Pay at the highest levels, as well as throughout the corporate heirarchy and board rooms, should be based on performance.  

Obama is forcing the discussion and having the difficult discussions that should have occurred long before this financial meltdown mess began.  Corporate excess and greed is not something which can be tolerated.  

I am a capitalist and supporter of a free market system and providing people with the opportunity for advancement and wealth accumulation.  I am not, however, a fan of C-Level mismanagement of the assets which have been entrusted to corporate leaders to create shareholder value and provide jobs for deserving and hardworking citizens.  

There has been a lot of emphasis on ethics and corporate responsibility in business schools of the past few years.  Perhaps there should be a continuing education track developed which all corporate leaders are required to take and if they are found to misuse the assets of their shareholders or knowingly participate in the falsification of corporate records, they should be subject to felony prosecution; not just saying it, but doing it.  

I am confident when we get to the other side of this global economic crisis, we will be in a better place, but we do need to ensure we stay focused on the free market enterprise system, with a focus on innovation and transformation, not becoming a socialistic society wher the government tells us how things will be.  There are a lot more vey smart people in corporate america and running their own businesses than there are in Washington, it is important that they not get caught up in the tempations of focusing on their own personal needs and accumulating wealth and toys at the expense of others.