Marketing NOT Selling

The world has shifted in the past several years, and if the old saying that there's a silver lining to every cloud has merit, then there are benefits to the retail community of this recession. One of them, I believe, is a reawakening of the need to "market" to consumers, not to "sell". What's the distinction?

"Selling" is a product focused approach to moving merchandise into the hands of consumers. Period. Without respect to actual needs, value, or usability. The intent and objective is simply to sell merchandise. Hard to fault that simple premise, as selling stuff is what retailers do. Or do they?

"Marketing" is a consumer focused approach to meeting the needs of shoppers through the benefits delivered by specific products. Is this semantics or is it a critical distinction? My company believes strongly that "marketing" is the real mission of retailers, not "selling", and that understanding the needs of consumers and then managing the assortment to meet those needs is Job One. Many merchants understand this both intellectually and instinctually. The problem is that the benefits of the products are not being "marketed" so that the consumer can identify with the needs they solve.

Online offers the greatest opportunity to actually market in the entire retail sphere. In store will always be limited by very short attention spans, destination shopping behavior, and a limited physical space for presentation, display and marketing. In store marketing is a challenge. It always will be. Online, however, has different characteristics which make it ideal for a more involved marketing strategy.

The industry might be well served to look at every available method for using the ecommerce site as a "marketing" platform first and foremost, and as a selling channel second. If the marketing is successful, the selling will follow! And if that effort is to be successful, an examination of the methods and tactics that will drive success is worth the time and effort.

Retail industry dynamics have produced an almost unprecedented level of inconsistency in the use, type, and accessibility of video on ecommerce sites. Apparently, the normal market forces of trial and error have not helped to guide an emerging consensus. Something is missing, and perhaps the answers lie in how “video” is perceived by the retail industry, and where within each organization the decision making concerning video seems to lie.

In the course of their survey, Future Merchants spoke directly with most of the Top 100 ecommerce retailers about the adoption and use of video. Without exception, those enquiries were routed to executives within the ecommerce organization. From that point onward, ownership of the topic of “video” began to vary significantly.

The results show that multi-channel retail organizations have difficulty identifying where the ownership of “video” should lie, with the exception of clearly believing it is an “ecommerce” issue. This fact provides extraordinary insight into the resources, types of content and tactics taken in implementing video. Tellingly, the cost-benefit calculation becomes limited to measurable impact on ecommerce volume, which represents a very small fraction of the total volume for almost all multi-channel retailers. This means that any expense, of any kind, will be analyzed solely on the lift generated in online volume. Ecommerce organizations are not typically evaluated or rewarded on the basis of in-store impact. Correspondingly, allocation of resources of all kinds will go to those initiatives that drive online volume first and foremost, despite conversion rates online in the single digits, and a growing awareness of the degree to which brick & mortar shoppers are exposed to and influenced by the website.

Second, there does not appear to be a department, organization or individual within these companies responsible for the creation of the video content. Lack of ownership within the ecommerce organization immediately begins to define how, where and to what extent the medium will be utilized. Most of the job titles found in the Future Merchants survey were either User Experience in nature, or ECom Technical. Even when a Marketing title was found, that individual operated within the constraints of ecommerce marketing, where Job 1 (and Job 2, 3, 4 and 100!) is the efficient use of limited marketing dollars to drive site traffic. So without dedicated internal organizational ownership, where is this video content going to come from?

This is an extraordinarily important point. Without direct ownership of content development, there is no budget established to fund the effort of creating content. The results are seen in the lack of sustainability alluded to earlier. When video programming is found on multi-channel sites, it is, with few exceptions, either repurposed content developed through corporate marketing (such as television commercials) to run on an entirely different platform (TV) or it is the result of one-off corporate marketing expenditures supporting specific events (exclusive brand launches, seasonal microsites, social media marketing, etc)….where the internal ROI has been measured by the impact on all channel volume! And moreover, the nature of where that programming comes from tends to mitigate toward branding connections, not toward driving sales behind specific products.

More insight into the issues and answers to retail websites and video programming will be delivered at the upcoming eTail West convention. Don Delzell, Managing Director of Future Merchants will be a Panelist on the Day Two Session: Driving Returns from Online Video With An Understanding of the Nuts and Bolts Behind Execution. Don will be offering a unique perspective on the issues behind the current industry experience with video.

Future Merchants has created RetailTV®, a revolutionary innovation combining over 50 years experience in retail merchandising, the art and science of master storytelling, and best in class technology to bring retail clients a powerful new method for driving cross-channel volume for key items.

Combining Solutions™ programming with the RetailTV® platform enables retailers to easily integrate powerful video storytelling anywhere on their website, while creating an interactive and seamlessly shoppable experience for their customers, driving sales on featured items across all channels.

The Future Merchants mission is to provide multi-channel retailers an affordable, high impact alternative to the declining effectiveness of traditional key item marketing techniques; an alternative that simultaneously engages the consumer, enhances the brand, and drives volume.

Retailers missing the real in-store link to the online world

An article published today in eMarketer discusses the ways multichannel retailers bring the Web into the store. Among the methods listed are internet kiosks, WAP enabled handheld devices, and point of sale terminals. Almost all of the emphasis is on the ability of the consumer to access online inventory when/if the store itself is out of stock. Pushing it one step further is the ability to present a significantly expanded assortment, with range and depth beyond that available on the shelf.

Still, the most powerful opportunity to bring the Web into the store is being missed completely, and it does revolve around mobile phones. That opportunity involves the use of 2d or QR codes. What are these? Simply, they are powerful open source 2d barcodes designed to bridge the gap between the offline and online worlds. I've recently reviewed the beta version of a new site, 2dCodeMe.com, which has been created to educate consumers about this technology. I was immediately struck by the powerful potential of the technology to vastly improve in-store customer service.

2d or QR codes are scan-able by almost any smartphone (after downloading a scan app....check out 2dCodeMe's at the iPhone App Store, it's excellent). The codes can be configured to auto-launch an array of applications in the smartphone, from uploading a text document (warranties, additional specifications, customer testimonials) to downloading a coupon (gee....see a product, scan a code, have a coupon on your iPhone!) to linking to a page deep within a retailer's website offering specific customer support (product demos, customer reviews, video programming, even the item page itself). The point is that all of this happens solely as a result of the consumer scanning the code and letting the phone do the rest of the work.

The Web has an almost infinite amount of purchase support available to the consumer. Instead of letting a consumer wander around aimlessly in that soup of information, why not send them directly to the content you've already created?

The real power of bringing the Web into the store is doing exactly that. Bring the real power of the Web. Accessing online inventory is not ground breaking, and honestly, could be done from most current point of sale registers simply by integrating the inventory in the data base. No, the real power of the Web is to engage, inform, entertain and empower. Imagine doing all that at the point of sale.

Accessing customer reviews (which already exist online and cost you nothing to make available), specifications and buying guides (which also already exist onlin and cost nothing), or product videos (which already exist too!)....these are the ways retailers need to be thinking. And the really amazing thing is that the technology is open source, already mature, and could be implemented with almost no additional resources.

Ecommerce websites add video: no consistency or sustainability

In January of 2009, Internet Retailer reported that 43% of merchants surveyed intended to add video to their site for the coming year. To test the actual penetration of video into ecommerce sites, a study completed in October 2009 by Future Merchants, Inc., shows that 67 of the Internet Retailer Top 100 have some form of video on their site. However, the adoption and incorporation of video remains, at best, an inconsistent and difficult to sustain effort for most of Internet Retailer’s Top 100.

Although retail as an industry seems to be acting on the desire for site video, there is very little consistency and seemingly no emerging consensus on what type of video programming to include. Nor does any of the Top 100 demonstrate a consistently sustainable model that delivers fresh and relevant content with any form of coherent frequency.

Despite the actual presence of some form of video content on a large percentage of retail websites, a follow up study published in November of this year by Internet Retailer shows that 36% of the respondents still list video as the most desired site enhancement. So even though a large number of retailers have actually added some form of video content, the topic remains one of the most cited for desired enhancements. There’s a disconnect somewhere! The explanation lies in the type of video assets ecommerce organizations found economically and technically feasible to implement.

Proprietary video programming and repurposed content have limitations of cost, availability and “fit”. Although a few retailers have a large amount of this content most have one or two pieces. The number of video assets found for both product demos and image animation has to be considered against a SKU base in the thousands for most of the Internet Retailer Top 100.

More insight into the issues and answers to retail websites and video programming will be delivered at the upcoming eTail West convention. Don Delzell, Managing Director of Future Merchants will be a Panelist on the Day Two Session: Driving Returns from Online Video With An Understanding of the Nuts and Bolts Behind Execution. Don will be offering a unique perspective on the issues behind the current industry experience with video.

Future Merchants has created RetailTV®, a revolutionary innovation combining over 50 years experience in retail merchandising, the art and science of master storytelling, and best in class technology to bring retail clients a powerful new method for driving cross-channel volume for key items.

Combining Solutions™ programming with the RetailTV® platform enables retailers to easily integrate powerful video storytelling anywhere on their website, while creating an interactive and seamlessly shoppable experience for their customers, driving sales on featured items across all channels.

The Future Merchants mission is to provide multi-channel retailers an affordable, high impact alternative to the declining effectiveness of traditional key item marketing techniques; an alternative that simultaneously engages the consumer, enhances the brand, and drives volume.

Do Black Friday Specials Really Serve the Consumer

This weekend I had planned to awaken at 3 am, rush off to my local Best Buy, and obtain one of the amazing deals being offered. In the process, I fully expected to pick up one or two other things, if the pricing seemed enticing. Unfortunately, the entire Black Friday phenomenon came to a crashing halt when I drove by Best Buy on Thanksgiving evening, around 8 pm, and found literally over a hundred people already in line. Already.

Being a well informed shopper, I'm aware that limited supplies exist of the amazing deals. Doing a quick calculus, I decided that by the time I was willing to arrive, say around 3:15 am, that line would be at least twice it's current length......lending me to believe my probability of scoring that deal was remote in the extreme. I did not make the attempt.

While anecdotal, the story bears paying attention to in retail marketing sessions. Who, exactly is it that camps out for these stellar savings? Is this customer valuable? Do they buy other, less deeply discounted items? I am beginning to believe that the answer is becoming "NO". I think, instead, that many of the line-campers are simply deal shoppers, there for a specific item. Not for their holiday lists.

I had no sense, in Best Buy, that the entire store was on sale, or that excitement existed for the store.....only for the limited quantity treasures everyone was hunting. By 8 am on Friday, the store was virtually empty. I asked some associates if it had been madness, and aside from the initial crush, the answer was no.

Is this the recession, or an inevitable life cycle on what truly is a promotional gimmick? The later, I think. Who is being served by limited quantities of outrageously low priced merchandise? Is brand loyalty being built, enhanced or developed? Lacking the research, I cannot say. However, I will argue that the time is NOW to actually do some research and find out if this tactic has run it's course.

Is technology limiting retail adoption of video?

Beyond the limitations imposed by an unfamiliarity with the medium, are there technology constraints keeping retailers from embracing video programming as a selling tool online? I use the phrase "video programming" rather than "video" because retailers have no trouble embracing "video". It's the programming part that seems to be a struggle! I digress......my apologies.

Technologically, what would a perfect integration of video programming into an ecommerce site look like? Let's start from what it should and should not do. Here are few observations from my research into the subject.

First, it should not take the consumer outside a normal shopping pattern or behavior. Any deviation from an expected and comfortable path will have an impact on site abandonment. Period. Second, it should be easily accessed without making the consumer an expert on site search options. Third, it should be linked to the ability to buy, easily and seamlessly. If the intent of the programming is to establish an emotional connection designed to sell merchandise, it makes sense to streamline the ability to act on that connection (not impulse, but connection). Fourth, it must be browser agnostic, avoid pop-up blockers and be functionally displayed without regard to the consumer's screen size or resolution.

Here are some things on what it should NOT do. First, it should not open a new browser window or separate and distinct window of any kind. Site abandonment rises immediately with new windows and off-page pop-ups. New windows of any kind do not keep the consumer within the existing experience....which is and should be the shopping page. Second, it should not take the viewer away from the video programming in order to shop. Current research categorically indicates that multi-product videos have a much higher trust and acceptance rate than single product videos. More on this another time. Suffice it to say that if you are going to create a video with multiple opportunities to purchase in it, it's just not smart to use technology that knocks the consumer out of that video experience when they try to shop the items shown. Third, it should not present a materially different shopping experience than the one the consumer could have had at the item level.

Imagine: a technology which integrates seamlessly into existing nav patterns, doesn't open new windows, provides item-level comparable conversion support and is completely shoppable from within the video program experience. Clearly there are a number of other best practices in UI to review, but this would be a good start, wouldn't it?

Video Commerce

Have retailers really embraced the concept of video commerce? What is video commerce anyway!

Video commerce: enabling commerce through video. The key being "commerce". Commerce is the transaction of business. Retail commerce is the transaction of business by providing goods and services to consumers. So Video commerce, in the retail world, would be enabling consumers to purchase goods and services through the medium of video.

Is this happening today? No. It is not. Retailers have begun to embrace the medium, yet have struggled with effective ways to link video content to commerce....making a sale. Why? Two key elements conspire to limit the impact of video in driving sales. Let's take a step back though. Why is this a big deal? Again, simply, in the advertising world, television commercials have proven to be the most powerful and effective mechanism for creating emotional connections and enabling branding. Period. Taking this one step forward, retail, at it's core, outside of commodities, is all about making emotional connections. And it better be about branding too....or it's all about price. Price retail is a bad business to be in unless you have the scale...of say Walmart.

So: waht are the two elements holding back retailers from using the full power of video programming? First it is a lack of familiarity with what the medium is actually best at doing. CPG firms and ad agencies know this because they deal with it all the time. Most retailers do not. TV has not been the easiest vehicle for any retailer to use, and even when used, tends to be solely a seasonal or brand related proposition. Very seldom has TV been used effectively to drive volume behind specific products. Makes sense: 30 seconds is not enough time to communicate much in the way of product benefits. Let alone consumer needs. So it makes sense that retailer marketers don't have the understanding of the power of video that other types of marketers with more familiarity do.

CPG and branding types know all about telling a story: it's what creates that emotional connection. And emotional connections are the holy grail of storytelling. Retailers know about pictures of products and descriptions of products ...... and do those very, very well. They do not know about storytelling. It's not their forte. However, without an appreciation for what storytelling does for SALES, video programming at the retail level will remain essentially animated still photographs, enhanced with music (maybe).

I'll post later about the second problem: technology. Before we get into that, it's important to take in the limitations imposed on anyone in business by what you know and what you don't know. If you don't know how powerful a tool, strategy, tactic or process can be.....and you don't know you don't know.....there's nothing you can do about it. Such is the case for video programming. Retail marketers, with some exceptions, simply do not know what they are missing.