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Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
Meet the Modern Day Merchant Prince
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Meet the Modern Day Merchant Prince

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Conquering ecommerce requires a number of traits: the right corporate culture; data, and lots of it; and the analytical capabilities to translate that data into a winning online experience. Corporate …

Conquering ecommerce requires a number of traits: the right corporate culture; data, and lots of it; and the analytical capabilities to translate that data into a winning online experience. Corporate leaders are hungry for such insights. In fact, 72% of CEOs are making major changes in their organizations to deepen understanding of individual customer needs.

But with what they have on their plates today, however, CEOs may find it significantly challenging to deal with the volumes of information and develop the insights needed to guide critical decisions regarding the digital marketplace. The chief marketing officer (CMO) may be the prime prospect to assume the role of merchant royalty. To succeed in that role, the CMO will need to strike the right balance of retailing art and retailing science.

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  • 1. Meet the Modern-Day Merchant PrinceWith Website Optimization and Personalization, Chief MarketingOfficers Can Marry the Art and Science of Merchant Intuition
  • 2. Meet the Modern Day Merchant Prince The 19th century dry goods magnate Stewart’s combination of skills and acumen made him the Alexander T. Stewart was wildly successful third richest man in America and earned him the apt title “The because he knew both his customers and the Merchant Prince.” Since his time, the business world has seen numbers. a succession of merchant princes (and princesses, as any Tory Burch fan will tell you) – people who combine instinct and Stewart intuited that placing cases of merchandise analysis to achieve customer engagement and sales success. along the sidewalk in front of his New York store would create buzz and draw crowds. At the same time, he understood the math of lining up low-cost wholesalers who would enable him to undersell competitors. Who will be the merchant royalty of the future? Certainly, the innate and experiential gifts of a Stewart or a Burch will likely be part of the package. But also, as apparent in the $42.3 billion in U.S. online sales during the 2012 holiday season, the ability to capture online customers and their dollars will be as crucial to retail triumph as the bricks-and-mortar magic of store layout, location and vibe.11
  • 3. Meet the Modern Day Merchant Prince But conquering ecommerce requires a number of traits: the right corporate culture; data, and lots of it; and the analytical capabilities to translate that data into a winning online experience. Corporate leaders are hungry for such insights. In fact, 72% of CEOs are making major changes in their organizations to deepen understanding of individual customer needs2. With what they have on their plates today, however, CEOs may find it significantly challenging to deal with the volumes of information and develop the insights needed to guide critical decisions regarding the digital marketplace. Who within the organization has the resources to give it a go? The chief marketing officer (CMO) may be the prime prospect to assume the role of merchant royalty. To succeed in that role, the CMO will need to strike the right balance of retailing art and retailing science.2 2- http://public.dhe.ibm.com/common/ssi/ecm/en/gbe03485usen/
  • 4. Meet the Modern Day Merchant Prince Customers are online and on the move Online shopping is expected to continue growing Retailers want to capitalize on these trends, of course, and healthily. Forrester Research estimates cyber sales will are making significant investments in online capabilities. That increase from $226 billion in 2012 to $327 billion in 2016, spending, however, skews heavily toward driving traffic. up 45%.3 The use of smartphones and other mobile devices to For every $92 spent guide buying decisions and make purchases is also experiencing robust growth. Forrester estimates acquiring customers, only $1 mobile commerce will reach $31 billion by 2016, a is spent converting them6. compounded annual growth rate of 39%.4 Nearly a third of consumers already have shopping-related apps on their smartphone. Heading into the 2012 holiday This disparity may not matter to a business with a popular season a majority of smartphone users planned to product line and devoted customers who value the ability to download apps for coupons, comparison shopping and make a purchase with as few clicks as possible. But many other price checks.5 retailers need to optimize and personalize the online experience so their site is more engaging than their customers’ sites; so that customers come to highly value and trust the information, products and services available on the site; and so the site 3- http://www.internetretailer.com/2012/02/27/e-retail-spending-increase-45-2016 becomes a reliable gateway to cross-selling, up-selling, and other3 4- http://www.forrester.com/Mobile+Commerce+Forecast+2011+To+2016/fulltext/-/ E-RES58616?objectid=RES58616 avenues that produce sales growth. 5- http://www.pricegrabber.com/about.php/about=press/article=261/ 6- http://econsultancy.com/us/blog/10914-why-are-conversion-rates-so-low- infographic
  • 5. Meet the Modern Day Merchant Prince Testing and personalization – balancing science and art As in every aspect of business today, data and data analytics are foundational to the science of online retailing. Relevant data can come in various forms, including data on the individual behavior of current website visitors – which web page or search term brought them to the site; what time of day and day of the week they visit; what business they’ve done with the company previously; what research they’ve conducted; what product categories interest them. All of these can help produce the next “best content” to show the person. This data can be enhanced and augmented from other sources, such as customer relationship management (CRM) data, which can help align the customer’s offline and online experiences. Loyalty card data can provide additional insights. Increasingly, social media data can be highly valuable in tailoring content for both Web and mobile device visitors. How useful might it be to learn that someone who likes or interacts with the brand is about to get married? Have a child? Take a trip?4
  • 6. Meet the Modern Day Merchant Prince Using analytical optimization and Increasingly, social media data can be highly valuable in personalization tools to evaluate all of this data, tailoring content for both Web and mobile device visitors. How retailers can develop a view of what customers want. useful might it be to learn that someone who likes or interacts with the brand is about to get married? Have a child? Take a As in every aspect of business today, data and data trip? analytics are foundational to the science of online retailing. Relevant data can come in various forms, including data on the individual behavior of current website visitors – which web page or search term brought them to the site; what time of day and day of the week they visit; what business they’ve done with the company previously; what research they’ve conducted; what product categories interest them. All of these can help produce the next “best content” to Just as a bricks-and-mortar titan understands how to showcase show the person. items in a store display or send a scent wafting through the aisles, the merchant royalty of the online world will combine This data can be enhanced and augmented from other intuition and data to drive traffic and sales. They will blend their sources, such as customer relationship management own instincts with the testing and targeting insights generated (CRM) data, which can help align the customer’s offline by their analytical gurus to determine what products are likely and online experiences. Loyalty card data can provide to interest a customer. And then they will be able to design additional insights. the display, showcase and offers based on each customer’s preferences, giving customers their own personalized store tailored to their individual needs and thus stimulating greater interest and, ultimately, stronger sales.5
  • 7. Meet the Modern Day Merchant Prince The timing and tools for capturing such insights have never been better. Consumers are constantly online today, whether on desktops, laptops, tablets or smartphones. Applying increasingly sophisticated algorithms to Big Data, retailers can generate highly personalized content, offers and product recommendations and a targeted experience that turns an ember of customer interest into a burning desire to buy. Site merchandising and product information tools enable customers to dig deeper and understand what a product is about – whether a piece of apparel will fit, for example, or what a particular stitching looks like. User-generated content – customer ratings and reviews, the rants and raves of social media friends – add to the rich mosaic of information and insights influencing buying decisions. In such ways, the online royalty will strike the right balance between the intuitive and the analytical. But that won’t necessarily be easy, because it requires a unique So who, then, is best equipped understanding of marketing, merchandising, data, analytics and positioned to wear the and web design. It also requires an organizational structure6 that encourages – in fact, demands – creativity and royal robe? innovation.
  • 8. Meet the Modern Day Merchant Prince The case for the CMO In any business, ultimate authority and decision-making is in the hands of the CEO. And as noted earlier, seven out of 10 chief executives are transforming their organizations to better understand customer needs. But with CEOs’ limited bandwidth, someone else must guide efforts to understand customers and parlay that knowledge into the right online and in-store experiences. In most companies, the CMO is best positioned for the task. Maintaining the analysis operation in IT could lead to overemphasis on data or reticence to conduct the intensive testing required for new product offerings and display concepts. Placing responsibility with sales may mean too much reliance on relationships and too little trust in the data. Having the CMO in charge can help increase the likelihood of striking the right balance of art and science.7
  • 9. Meet the Modern Day Merchant Prince Succeeding in such a role will require the CMO to address several priorities: Buy-in and collaboration. Especially in companies with both Unending organizational curiosity. It’s also important offline and online operations, it is critical to reach out to people to establish and nurture a culture of testing, measuring, who have different views on what should drive the business learning and iterating, rather than relying solely on guesswork and find ways to collaborate. and subjective decisions. With such a culture in place, the business can start using data to evaluate everyone who visits New skill sets. CMOs can’t do this alone of course. They the website. It can tailor ideas and content to inspire different need people with the skills and tools to analyze data, draw market segments and customer personalities. the right conclusions, and then take action on that data. They need designers and creative departments with the mindset to Even stronger focus on the customer. Ultimately, come up with many different ideas rather than a single “best” companies can develop the ability to engage with every idea. They will want to share ideas with customers, discover person they encounter. And those that do so first can what they like and don’t like, and then learn and respond by establish deep customer loyalty and value. continually refining what they offer.8
  • 10. Meet the Modern Day Merchant Prince Thriving in an offline-online world We’ll never know how Alexander Stewart would have approached Text Headline online shopping, mobile apps and social media. But it’s a fair bet he would have understood the power of algorithms, the value of Text testing and tailoring online offers, and the potential of social media to find, engage and build relationships with customers. At the same time, he wouldn’t abandon his instincts. As he did a century and a half ago, he would ascend to the ranks of retail royalty by combining art and science. If you are in terested in s Maxymiser, peaking wit please ema h someone il info@max at ymiser.com9

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