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Perspectives 2013 online version

  1. 1. Perspectives 2013 1 1 Chapter Heading
  2. 2. Contents
  3. 3. 04 Chapter Heading The Great Work Manifesto Stephen Foxworthy Strategy Director, Melbourne 01 06 – 09  00 Introduction Tim O’Neill Co-founder & Joint Managing Director 04 – 05  The Customer Experience Maturity Model Tim O’Neill Co-founder & Joint Managing Director 02 10 – 11 What Shapes Design? Tim Kotsiakos Executive Creative Director 03 12 – 15 Can’t Touch This! New Interface Challenges Tim Büesing Creative Director, Sydney 04 16 – 17 Shoppable Media: Content Meets Commerce Katrina Scott Designer, New York 05 18 – 21 Who Owns Your Content? David Jones Strategist / Analyst, Melbourne 06 22 – 23 Measure, Test, Optimise Chris Thomas Chief Search Engineer, Melbourne  Richard Ram General Manager, Auckland   07 24 – 27 The Personalisation of Everything  Tim O’Neill Co-founder & Joint Managing Director  08 28 – 31 The New Rules of eCommerce 09 32 – 33 The Future of Connected Retail Bradley Grinlinton Managing Director, London 12 42 – 45 Thoughts? 13 46 – 47 The Rise of eCommerce in Asia Ruth Henry Product Development Manager, Melbourne 11 38 – 41 SoDA Digital Marketing Outlook 10 34 – 37
  4. 4. Introduction Tim O’Neill Co-founder & Joint Managing Director Welcome to Perspectives 2013, an inside look at the hearts and minds of the Reactive team, a collection of viewpoints from our offices around the world.
  5. 5. Introduction We were thrilled with the response to the 2012 edition of Perspectives. Our goal was to help our clients (and digital marketers around the world) filter through the never-ending list of ‘next big things’ and invest their hard-earned budgets wisely. We think we succeeded in identifying what to watch. In this issue we explore topics that on the surface seem broad, such as evolving touch devices, shoppable films, connected retail environments and Asian eCommerce. But each has a common-thread, and it’s not just the obvious — that they are all ‘digital’. Each article covers a way to communicate in a relevant and personal way to your audience. This theme is explored in The Personalisation of Everything (page 28), which also asks the question “at which point does amazing relevancy become creepy?”. We hope you enjoy Perspectives 2013, and we certainly hope you find the content relevant to your business or brand. If you agree, disagree, or have a question or comment on any article, please tweet @reactive with #perspectives2013. Thanks for reading. Perspectives 2013 06
  6. 6. The Great Work Manifesto Stephen Foxworthy Strategy Director, Melbourne At Reactive, our purpose is to produce Great Work. But what is Great Work? And how do you know when you’ve produced it?
  7. 7. The Great Work Manifesto Reactive’s Great Work Manifesto keeps us focused on producing work that is creative, effective and challenging. Our clients are Great For any business, one of the keys to success is to have happy, engaged customers. So we strive to produce digital marketing that meets and exceeds our clients’ needs, and the needs of their customers. We push the boundaries of what’s possible in digital, and develop award-winning experiences that help them reach, engage, convert and retain customers. By doing so, we work to build long-term partnerships with our clients and help deliver effective return on their investment. To ensure we’re continually improving our client relationships, we actively measure client satisfaction, which gives us great insight into what clients really want from us. We use the Net Promoter System to benchmark ourselves, and use the results of client interviews and surveys to inform the process of continuously improving our services. “We push the boundaries of what’s possible in digital, and develop award-winning experiences that help companies reach, engage, convert and retain customers.” But delivering Great Work for clients is just one piece of the puzzle (albeit a very important one). Our team is Great Next, we pride ourselves on our team and culture. Reactive is made up of multi-disciplinary teams of creative digital experts — designers, developers, account service and project management all collaborating to produce digital work of outstanding quality. For any project to be deemed Great Work by our team, it needs to be of a very high standard. We’re all proud of the work we do, so we continuously strive to produce unique and engaging solutions to client problems, and we consider ourselves some of the best in the world at what we do. If the work is not original, challenging, creative and innovative for our team, then it probably isn’t Great Work. Perspectives 2013 08
  8. 8. The Great Work Manifesto The Great Work Manifesto Our business is Great Finally, it’s possible to deliver outstanding work that meets all client needs, wins awards, and gives our team a sense of pride and purpose, but that ends up costing the business money (and eventually would force us to shut up shop!). Thankfully, at Reactive this isn’t an issue because we pay very close attention to the third part of our Great Work equation: our business. We choose to partner with clients who understand the value of digital marketing and who allow us to do our best work for them. If a project doesn’t come with a fair budget, and the opportunity to deliver the work profitably, then it’s unlikely to be sustainable — and unsustainable client engagements are definitely not Great Work for anyone involved. By assessing our work against these three key outcomes, we can decide if a project has been worthwhile — and we can find the areas where we need to improve in a simple, effective way. At Reactive, we always set out to produce Great Work, so if we find that we haven’t ticked some or all of the boxes, we have to look long and hard at what went wrong in our process, with our client, or with the team to identify how we can improve in the future. Putting it all together is really Great So that’s how you produce Great Work. Make sure your work exceeds the expectations of your clients, is fulfilling for your team and allows your company to grow sustainably, and you’ll be producing Great Work too. Our Clients Our Team Our Business Did it solve the problem? Was it challenging? Does it build our reputation? Was it delivered on time? Did it utilise our strengths? Was it profitable? Was it within the budget? Was it best practice? Was it efficiently executed? Was it effective and delivered results? Was it high quality? Was it creative and bug-free? Was it rewarding? Perspectives 2013 09
  9. 9. The Customer Experience Maturity Model Tim O’Neill Co-founder & Joint Managing Director Sitecore has recently released their Customer Experience Maturity Model, a framework for assessing an organisation’s digital maturity and planning a roadmap for the future.
  10. 10. The Customer Experience Maturity Model Reactive recently took a look at the model and believe the framework is relevant to any company (not just those that use Sitecore) and furthermore to any agency (such as Reactive) that provides digital services. The Customer Experience Maturity Model begins with a simple, frank assessment of where in the seven levels of digital maturity your company sits. The first step Initiate is appropriate for companies that have ‘brochure-ware’ sites, with little complexity. At the other end of the scale are very mature companies that focus their digital efforts on creating Lifetime Customers. They use intelligence and predictions to optimise cross-channel customer experience. Each of the seven levels has typical Objectives, KPIs and Focus Areas, making the assessment a reasonably straightforward process. (Although some may think they are more “mature” than reality!) Where the model starts getting really interesting is the mapping of each level with typical customer experience software ‘features’, such as Content Distribution, Campaign Management, Personalisation and Predictions. Interestingly, the model can also be “flipped” by clients and used as a digital agency assessment tool — how mature is your digital agency? How many of the recommended actions has your agency actually implemented? The model doesn’t stop there. It goes to extremes outlining multiple levels of maturity within each feature (such as Rules Based Personalisation to Behavioural Targeting), and then the appropriate roles within an organisation for each of these customer experience features. We believe 2013 is the year of Customer Experience. Using assessment models such as Sitecore’s Customer Experience Maturity Model, Reactive can help companies provide a helpful and beautiful experience for their customers. For more information on the Sitecore Customer Experience Maturity Model, please get in touch with Reactive: Perspectives 2013 11
  11. 11. What Shapes Design? Tim Kotsiakos Executive Creative Director When used successfully, design provides real business value. As the digital world matures and the audience impression of a brand relies upon their online experience, it can be the difference between engaging an audience and confusing them.
  12. 12. In recent years… A lot has changed. Clients have changed. Whereas they once sat within the IT department, clients are now from within the marketing, innovation or customer experience functions of a business. Digital budgets are increasing. The user, who is more mobile and more socially connected, now has a greater expectation of their experience. The user also has less patience, exacerbated by the growing magnitude of choice. The technology landscape has also changed, resulting in production challenges and advantages. These changes have driven the industry to think about things differently. More interactive experiences require less clicking from one page to the next, thanks to better browser technology and improved on-page production techniques. We have seen an influx of long scrolling pages, parallaxing content and clever interactivity or loading sequences (akin to what Flash once provided). And all of these features now work on mobile and tablet. There has been less of an emphasis on fixed navigation appearing along the top layout and more consideration around how content can be revealed within the guts of the page, allowing users to discover content as they explore. What Shapes Design? Recognising what has worked well in the past and what will be the next big thing with regards to design, is a pretty slippery slope. The first thing to acknowledge is that design for digital is informed by the following three demands: • The client: their appetite for innovation and risk, their success criteria, their budget and their deadline • The user: who they are, where they are, what their expectation is and what device/technology they are using • The technology: the ability to produce the experience, on time and on budget Clients sponsor the projects, the user provides the business opportunity and the technology provides the means. The most successful projects find perfect harmony between these three demands — the project becomes viable at the intersection of all three. But what is important to note is that each of these three elements are changing rapidly. Clients are becoming more experienced, users more demanding and technology more innovative. As these elements change, new opportunities within the landscape are created, and a few are worth discussing. Before we get into them, it’s worth going back in time. “The user, who is more mobile and more socially connected, now has a greater expectation of their experience.” Perspectives 2013 13
  13. 13. Perspectives 2013 What Shapes Design? Responsive Design has made a definite impact on the industry in recent years, challenging the way we work, along with altering finished outcomes. More and more websites have incorporated a modular design approach that shuffles the layout from one device to another, from one resolution to another. The grid has been an important tool for designers, helping them to create rationalised interfaces and negotiate things like ‘breakpoints’. Combining all of this with things like the visual impact of the new Windows 8 Interface, the choice for some has been a rather rational, mosaic, and blocky approach. On top of all these trends, typography has finally come to the party. Today there are many ways for designers to use fonts on the web. Retina displays make for sharper, crisper typography, re-establishing the likelihood of longer form content being read by users. In the near future... The changes of recent years will continue to influence the evolution of design in a number of ways. Content is at the top of the list, with most in the industry declaring the importance of content accessibility on any device, anywhere, and some going so far as to suggest the need for content to adapt to the user. There is no doubt that user profiling and content personalisation will increasingly become a serious part of any compelling experience. Simplicity, in every aspect, will be a big theme. Design will be influenced by the requirement for vector graphics and modular layouts that scale to respond to different settings. Information graphics will be employed more often to help turn complicated data into information that can be absorbed more easily by the user. Thanks to multi-touch technology and an increasingly confident audience, gestures will become more vernacular and provide more content, allowing interfaces to appear simpler without compromising on functionality. Experiences will become increasingly single-minded as the population of the internet will overflow with new experiences, each one struggling to differentiate. The proliferation and widely accepted usage of applications across multiple devices, combined with users’ growing demand for consistency between them all, will stretch and challenge designers. As desktop experiences start adopting some ‘app style’ interaction patterns, newly internet-enabled devices like smart TVs and in-car entertainment will need to be considered as part of the ‘eco-system’ of digital experiences. Users won’t be satisfied if their experience is inconsistent, incomplete or inappropriate from one device to the next. Over time the device itself will become transparent in the mind of the user and will simply serve as a window into their pool of content. What Shapes Design? 14
  14. 14. Perspectives 2013 What Shapes Design? ‘Signs of life’ will grow in popularity, as more of the audience will be looking for experiences and brands that connect with them on a personal level. We will see more subtle examples of interactivity mimicking organic shapes or physics and bigger visual statements like water colour brushstrokes, hand-drawn lettering and very personal copywriting. Digital marketing campaigns will connect online users with real life objects, in real time, in real environments. Users will engage more willingly with experiences that make them feel like a human again. In summary There is definitely a pressure on us to create better and more innovative experiences for our clients and their customers. The overall standard of this type of work is strengthening, and it’s only reasonable to engage in the race to be first. Whilst I don’t like using the words ‘trend’ and ‘design’ in the same sentence, there is no doubt that there are influences bigger than us contributing to the success (or failure) of some design choices over others. My gut feeling is that the most successful projects, those which will be timeless, will be based on good old thinking, an empathy for the user, and traditional design principles that have been around for years. If the experience provides no meaning or convenience to the user, its days are numbered. “Over time the device itself will become transparent in the mind of the user and will simply serve as a window into their pool of content.” 15
  15. 15. Can’t Touch This! New Interface Challenges “Either work hard or you might as well quit. That’s word because you know… You can’t touch this.” – MC Hammer Tim Büesing Creative Director, Sydney
  16. 16. Can’t Touch This! New Interface Challenges well as touch and swipe. While many professional reviewers have called the Surface experience confusing, tests indicate users prefer its touch interface. They even neglect cursor and keyboard for tasks where they are generally considered superior, such as filling out longer forms. Instead, they grab the Surface’s screen as if it was a tablet only. Additionally, most websites or applications can’t tell which ”interaction mode” the user is in at any given moment. That’s why user interface experts like Josh Clark advise, ”If a device can be used for touch, its interface should be finger-friendly.” From a creative standpoint, this sounds like a lot of BFBs (Big F!#&ing Buttons), a somewhat chunky layout of the future web. Responsive Design — creating websites that respond to a variety of screen sizes and thus avoid the need for separate sites — is only part of the solution. What responsive sites can’t quite address are users’ motivations, behavioral patterns, and ergonomics specific to using mice, fingers, arms, and voices. Touch interfaces, for instance, work better with navigations placed at the bottom. But can we expect people to learn different interfaces with every device? And can we expect budgets to cover every optimisation? That’s why it’s best to stay on track with your audience and analyse which devices are significant in terms of current and future share. Project and estimate what your audience will move towards, budget accordingly, and be open with users on less common devices. After all, you’re working hard so they can touch this. And that’s very word.’s Hammertime! Once again I’m stuck on an eCommerce website that apparently hasn’t considered I might want to purchase from a tablet. My fingertips seem well within what web experts define as average (approximately 44 pixels). Yet here I am, grappling with a nasty popup window that I just cannot touch. It would work well if only I used a mouse. On my iPad it feels like the shop owner is pressing the door shut as I’m trying to enter his store. Grmpfh... After switching to the mobile site, my big fat fingers work much better, but now my previously loaded shopping cart is empty. Shall I give up, return to my laptop, search, and select the items again? And would it recognise me if I returned, neatly perched on my couch, using Xbox or a smart TV where my spoken commands mix with gestures and a wand-like remote control? These situations pose very real questions for brands, publishers, and start-ups. We users have grown to expect optimised experiences from them on every one of our devices. Touch, voice, and gesture have matured and added variety to how we access services, purchase goods, entertain ourselves, and share stories. And eCommerce is especially ripe with users hopping between devices. Etsy, for example, sees a desktop/mobile split of 75/25 in terms of traffic but 80/20 for purchases, meaning one out of every five mobile window-shoppers switches over to a PC to complete the transaction. Microsoft’s new Surface computer has made this duality apparent. On a single device, users can type and click as “Responsive Design — creating websites that respond to a variety of screen sizes and thus avoid the need for separate sites — is only part of the solution.” Perspectives 2013 17
  17. 17. Shoppable Media: Content Meets Commerce Katrina Scott Designer, New York The arrival of Shoppable Media in the form of Shoppable Films signals a shift from branded content back to commerce. It is the strongest sign yet that video might be where traditional media and digital media ultimately converge.
  18. 18. Shoppable Media: Content Meets Commerce Branded content has facilitated customer engagement in unprecedented ways. It has also redefined the role of advertisers or more specifically what we define as advertising. Recognising the recent trend in the consumption of online video and with an understanding that film enables deep levels of engagement — the ability to tell a brand’s story in a way that static content simply cannot — online retailers have been quick to explore the potential of ‘Shoppable Films’ (video content which includes eCommerce features). So far, success has been varied. When UK online retail powerhouse ASOS began researching why awareness of their brand among young men was low, they discovered that male consumers don’t take their fashion cues from magazines or the catwalk but from culture, sports and the street. This observation inspired the creation of Urban Tour, a fully shoppable short film of London’s best street dancers. It enabled users to pause, explore and purchase the featured clothing. The campaign was hugely successful: it lead to an additional 500,000 men visiting within the first three months of launch and was also awarded a coveted Cannes Gold Lion. Another Cannes Award recipient was The Liberation, an online interactive film by Danish denim brand Only Jeans. Touted by the brand as “the world’s first on-demand, online, video, retail environment and also a fashion catalogue, movie, “Both ASOS and Only Jeans understood that the unique content was neither a film, nor an eCommerce website. The result was two exceptionally well executed Shoppable Films.” ASOS Urban Tour — Results: • 3rd most watched brand video on YouTube in 2011 • 7.36 million views recorded in the first 8 weeks • 6.9 million twitter impressions • 237,000 new male facebook fans — a 24% increase over 11 weeks • 46% of all visitors were new to, rising to as high as 81% in the US • 14% of visitors made a purchase within 7 minutes of watching the video game and music video”, it allowed viewers to click and freeze the film and with the movie paused, viewers could purchase clothing or share their selections via their preferred social networking platform. Pushing the boundaries of consumer engagement, it even enabled the viewer to determine the characters’ actions, furthering participation with clever interactive techniques. The film ended by curating a bespoke catalogue based on users’ behaviours enabling them to revisit their choices. Perspectives 2013 19
  19. 19. Shoppable Media: Content Meets Commerce A key to the success of these campaigns was choice of narrative style. The format of both films was non-linear, similar to a music video, so that a viewer could stop and start the film with minimal interruption to their understanding or enjoyment. Clever video editing devices and seamless audio allowed the content to be loopable if stopped at any time, much like a video game. This enabled intuitive eCommerce Only Jeans The Liberation — Results: • Traffic to rose more than 500% • Site garnered +560K unique visitors with +810K page views • Within 2 weeks, the site had over 280,000 unique visits and the campaign had spread to thousands of sites and blogs • Movie has since been viewed over 1 million times across more than 100 countries worldwide • 3 Cannes Lions at the 2012 Cannes Lions International Festival of Creativity • Play to end rate Germany (74%), Denmark (68%) and Norway (67%) functionality and a range of other interactive features to be effortlessly incorporated into the films, alongside the branded content. ASOS and Only Jeans demonstrated that success can be found with this new medium if every aspect of the user experience is approached in a new and considered way. Both brands understood that the unique content was neither a film nor an eCommerce website. The result was two exceptionally well-executed Shoppable Films, that yielded a high return on investment. (see Results, left and previous page.) By contrast, U.S. retailer Target’s three-minute short film Falling for You may have had the budget to secure an A-list cast, but its poor execution and scant regard for the user’s experience is a classic example of traditional advertising poorly re-purposed in a digital context. The choice of a scripted film was an erroneous one. If the viewer took their focus off the film for just a second (to, for example, shop?!) they immediately missed dialogue and potentially lost track of the story. Compounding this was the side bar navigation which scrolled articles of clothing as they appeared in the film. The user was left with what was essentially an animated eCommerce website ‘attached’ to a video. Users couldn’t engage with either on any reasonable level. Shoppable Media: Content Meets CommercePerspectives 2013 20
  20. 20. Perspectives 2013 Shoppable Media: Content Meets Commerce “The choice of a scripted film was an erroneous one. If the viewer took their focus off the film for just a second (to, for example, shop?!) they immediately missed dialogue.” YouTube launches annotation functionality. A recent ComScore report estimated that 181 million people watched more than 39 billion online content videos during September 2012. Studies predict that video-based internet traffic could grow to more than 90% in the next 12 – 18 months. In November 2012, YouTube announced the release of external annotations technology enabling merchants with channels to implement annotation tools in their own video content, allowing click and buy functionality to be incorporated into the video, linking back to eCommerce stores. Many high profile brands are already utilising the new feature with varying degrees of success. This is yet another indication that the branded content video trend won’t be slowing down any time soon as brands continue to look for innovative and original methods of engagement. Shoppable Media may be in its infancy, but many signs point to a trend of video as branded content. If an agency is fortunate enough to secure a client with the ambition and budget to pursue the production of a Shoppable Film, several factors need to be considered. It’s essential to understand the purpose and target market, and also to recognise that a traditional approach to both mediums will invariably fail. It requires significant investment in high production values and consideration of the nuances within both forms of media. More broadly, it requires an appreciation that traditional advertising and digital media no longer exist independently — a timely reminder of the direction of the industry. 21
  21. 21. Who Owns Your Content? David Jones Analyst / Strategist, Melbourne When it comes to social media, the meaning of ownership has become perverse.  Less rights and more responsibilities. Hardly fair?
  22. 22. Who Owns Your Content? Over the past year we’ve seen awareness of content ownership, rights and responsibilities hit the mainstream. In December 2012, newly Facebook-ed Instagram updated its terms of service to fall more in line with its new owner. They updated their Terms and Conditions (T&C’s) to include the provision of: “a non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide license to use the Content that you post on or through the Service.” As licenses go this is pretty wide! It could be summarised as “a right to do anything,” and it flew in the face of what Instagram stood for in its pre-Facebook days. Users were outraged, with a tremendous number vocalising their disappointment online while threatening to quit. Facebook, Twitter, Instagram, Flickr — the T&C’s of each service are central to each site’s DNA, who gets to see what content, and what they get to do with it. Privacy settings, Application Programming Interface (API) documentation, and those T&C’s people never read when they sign up — each contain a tremendous amount of vital information for a user, masked in a tremendous amount of legalese. These words may be boring, but the fine print matters. For brands, taking a holistic approach to social media campaigns from the start pays dividends. In these heady days of blue sky thinking, creatives need to know what a social network’s API terms actually make possible. While there are fantastical things Facebook can do with all the content they have “a right to do anything with”, the Facebook API only shares the love so far, and designers and developers need to be aware of these limitations. The license to content is Facebook’s (or Twitter’s or Instagram’s) to transfer and they tend to save that for loosely associated third parties they have a financial stake in. Brands need to understand that access via the API is on the social network’s terms and may change at any time, not necessarily for the good of brands or the community. Additionally, social networks are in a state of constant flux, with new features rolling out and old approaches retiring. This means that a campaign developed today can be rendered obsolete tomorrow if the network changes the way they do things at the product level, often without forewarning. Brands need to be prepared to adapt and change their campaigns and content quickly in the event of a major product update. This can obviously have major implications on budgets and resources. But that doesn’t mean that brands should shirk away from embracing all of the amazing opportunities these platforms offer for branded content. Rather, it is essential that brands, designers, and developers educate themselves on who owns what and what the T&C’s of each allow for. Doing so from the start will pay off immensely. “For brands, taking a holistic approach to social media campaigns from the start pays dividends.” You should know: • Competitions and endorsement regulations apply; prizes over a certain value require permits and endorsing tweets should be identifiable. • In 2012 the Australian Advertising Standards Bureau held that Diageo and Victoria Bitter were responsible for user generated content. This content is an advertising channel like any other. • The AANA recommends regular monitoring for 2 hours after each post and moderation at least once every business day thereafter. • Some copywriters charge more for content to be placed on social media. It's not just the client they are giving rights to — it is the social network too. Perspectives 2013 23
  23. 23. Measure, Test, Optimise Richard Ram General Manager, Auckland Chris Thomas Chief Search Engineer, Melbourne One of the biggest challenges for time-crunched clients is trying to understand and interpet analytics data. The sheer size and depth of products like Google Analytics and Webtrends can make reporting seem almost insurmountable.
  24. 24. Perspectives 2013 Measure, Test, Optimise The interpretation of audience data seems to be a concern we hear from clients across the board and around the world. Where do you start? What should you be reporting on? Where do you find the data you need? Most importantly, what does the data really mean and what actionable insights can you gain from the information you’re looking at? In our view there are essentially four areas you need to be reporting on: • Reach (how are my traffic-driving strategies performing?) • Engagement (how is the website on analysis like ‘time on site’ or ‘bounce rate’) • Conversion (how efficiently is the website converting website visitors into leads or sales?) • Loyalty (how are my strategies for bringing people back to the website performing?) For each of the above you should define the objectives, activities and the annual strategic priorities. You should also know who you’re trying to attract to the website. Each quarter it can be a good idea to focus on just one of your core audiences, develop initiatives to drive them to the website and measure how effective this activity is. (See table on next page.) But the first step in all of this is ensuring that your Analytics are configured properly so that you are in a position to see how each of the four primary reporting pillars are performing over time. Most analytics products work well out of the box for standard reporting requirements, but all analytics packages require additional configuration to maximise the ability to report on your website’s performance. For example, if your business is eCommerce-based, you need to enable eCommerce tracking and reporting. If you collect leads from your website, you need to ensure that lead goals are in place and are properly triggered every time a person lands on a ‘Thank you’ page. When someone downloads a brochure, it’s probably helpful to set up events or goals around those type of actions. You may also want to create filters which exclude internal traffic coming from your business to your website so your data is reflective of real visitation, uninfluenced by your own team or agency. Once this work has been completed, you have set up your measureable KPIs which are aligned closely to your Business Objectives. Important stuff. “In our view there are essentially four areas you need to be reporting on: Reach, Engagement, Conversion, and Loyalty.” 25
  25. 25. Measure, Test, Optimise Now you can drive quarterly initiatives and measure how each is performing against your KPI benchmarks. Quarterly initiatives need to be implemented and tested against pre-established benchmarks. For example, ‘Reach Initiatives’ to implement and test might include Advertising on Facebook, sending more emails, Google AdWords Advertising, or LinkedIn Advertising. ‘Engagement Increase Initiatives’ might include copy and image revisions on critical landing pages to improve ‘time on site’, ‘pages viewed per visit’ and ‘bounce rate’ KPI’s. You could also consider adding video on to the site and then measuring and reporting on its influence on website engagement. Example ‘Conversion Increase Initiatives’ could include improving ‘Calls to Action’, reducing a shopping cart check- out process from four steps to a single ‘one-step-checkout’ and running A/B split tests on important landing pages. Finally, example ‘Repeat Visitation Increase Initiatives’ might include starting a Google Remarketing campaign, creation of a blog and development of a social campaign strategy or competition. There are also other kinds of analytics packages outside of the ‘typical’ analytics products which we love to use. One of our favourites is the crazily named, but very powerful, CrazyEgg. This software overlays a heatmap on your web pages showing what’s hot and what’s not. We use it to visually assess the current performance of a website, particularly around the effectiveness of ‘Calls to Action’ page elements such as links, banners and buttons. Small changes to colours, element sizes and positions can create a dramatic uplift in conversions — which leads us from measurement to testing. Being able to understand what’s actually going on and make data-driven decisions about what could be improved on your website is essential. There’s no point setting up all the measurement initiatives if you don’t actually do anything with the insights. Implementing a testing strategy should naturally follow, which needs to involve prioritising what to test before running A/B split tests on web pages (a control and challenger). This process will ensure that the changes you’re implementing to optimise desired user behaviour are validated. (Of course, multivariate tests should also be considered.) Once you have a validated and successful experiment, you need to move on to the next priority as part of your measurement and testing plan. Websites, their promotion and the advertising that goes along with supporting them to maximise visitation are significant investments. You must create a framework to enable you to understand exactly how the impact of any initiative is contributing to your broader Business Objectives. Remember: every initiative must be accountable, and accountablity allows for actionable insights. Perspectives 2013 Measure, Test, Optimise 26
  26. 26. Measure, Test, Optimise Increase Reach Increase Engagment Increase Conversion Increase Repeat Visitation Objectives • Attract female audience via targeted online activity • Improve female representation in our social media channels (in particular Facebook) by 10% • Build in-bound traffic from women by 15% • Lift female representation in eDM database by 10% • Improve female visitation engagement metrics this quarter • Improve conversion rate of female audience • Launch loyalty program this quarter Activities • Targeted keyword search (SEO) • Targeted keyword advertising (SEM) • Facebook advertising (targeting females 15-35) • Launch ‘send to a friend’ campaign for females on eDM database & reward them for each friend referred • Creation of female-friendly imagery on website • Engage copywriting team for female-friendly website copy on PPC landing pages & women’s sections of the website • Create a competition targeted towards women • Development of dedicated PPC campaign landing pages • Split test new PPC landing pages • Female-based user- testing of women’s sections of the website to help increase engagement • Announce new loyalty program via eDM, PPC, social advertising/media & retargeting campaigns Strategic Priorities • Build annual traffic from targeted audiences by 25% • Increase retargeting audience pools by 15% • Improve time-on-site metrics by 20% from previous year • Decrease bounce rate by 10% from previous year • Improve conversion rate of website by 50% from previous year • Improve Average Order Value (AOV) by 10% from previous year • Create a loyalty program • Increased frequency of eDM blasts • Increase eDM database size by 10% 27
  27. 27. The Personalisation of Everything Tim O’Neill Co-founder & Joint Managing Director Stephen Foxworthy Strategy Director, Melbourne With all the audience data websites are collecting, marketers are now able to provide an impressive personalised experience at nearly every customer touchpoint.
  28. 28. The Personalisation of Everything Remember the scene in the movie Minority Report when Tom Cruise is greeted by the name “Mr. Yakamoto” by a holographic apparition as he walks into a futuristic Gap store? Right now, this type of personalisation via facial recognition, Customer Relationship Management and digital screen technology is almost achievable by retailers, but everyone who has seen the film knows just how creepy this interaction was. While most companies are now collecting masses of customer data, what most brands and advertisers do with this data at the moment is not very impressive. This will change over the next few years as the personalisation of everything becomes a reality. So what are the major trends making all this possible? Behavioural Analytics If another person says “Big Data”, I’ll scream. Collecting masses of data on your customers is fundamentally useless, unless you know what you want to find out from it, and how you’re going to adapt to it. Businesses should be able to personalise a customer’s online experience by understanding what they’re likely to do or want next, and behavioural analysis tools are now maturing to the point where they can quite accurately predict what customers are likely to do next based on what other customers have done before. Recommendation Engines Anybody who has ever shopped on knows just how good they are at recommending products to buy based on what you’ve looked at or bought. But every now and then, their recommendations can be quite random. We all want to be different, just like everybody else, but we’re often more alike than we think. Online recommendation services like Hunch can provide personalised recommendations across a whole range of categories based on your social profile or online behaviour with frightening accuracy. Recommending products via computer algorithm has historically been extremely difficult. But now there are recommendation engines that can be bolted onto most websites and eCommerce stores that will provide Amazon- style recommendations on the fly. These systems are getting better and better, with suppliers like RichRelevance or Barilliance now offering plug-in “We all want to be different, just like everybody else, but we’re often more alike than we think.” Perspectives 2013 29
  29. 29. The Personalisation of Everything recommendation engines that automatically generate product suggestions based on user data and are easily integrated into existing websites. Dynamic Content and Flexible Content Management Content may be King, but personalised content will become the Uber-Galactic Emperor. One of the limiting factors of personalising a customer’s online experience used to be the need to customise the website content management system to be able to serve different versions of content to different audiences. Now, web content management systems such as Sitecore and Adobe Experience Manager make it much simpler to define the rules for personalisation and to manage the content required, making truly personalised online experiences practical for many brands. Changing consumer attitudes and the loss of privacy Companies such as Google and Facebook are already sitting on deep and valuable information about you that allows them to target you with ads based on relevancy. In the future, any online transaction will be tracked, analysed and used by the company you’re dealing with to deliver more relevant and targeted service or offers. “Content may be King, but personalised content will become the Uber-Galactic Emperor.” Perspectives 2013 The Personalisation of Everything 30
  30. 30. The Personalisation of Everything Whenever we talk about personalisation of the customer experience, the conversation almost immediately turns to privacy, identity protection and intrusion – not the benefits that personalisation might bring. There are howls of outrage; should advertisers have the right to follow people around the Internet trying to understand your habits, behaviours and intentions? In truth, nearly every interaction you have online is already being tracked, and adds to data profiles of who you are, what you do and what you like. What’s next for Personalisation? The technology driving personalisation of the customer experience online is commonplace, and getting smarter by the minute. Soon, you can expect the companies you deal with to be providing individual offers and promotions that magically fit your needs, predict what you’ll want next and pre-emptively provide you with value before you were even thinking about it. The Personalisation of Everything is accelerating at a cracking pace. We can expect our online experiences to become more and more personal, individual and useful based on what we do every day. Being welcomed by name as we enter a store won’t seem creepy anymore. It will just be the way business is done. Perspectives 2013 31
  31. 31. The New Rules of eCommerce Online retail is evolving as rapidly as the rest of the Internet, with customers now shopping and buying online in ever increasing numbers. For retailers looking to capitalise on this growing trend, a number of best practices and opportunities are emerging that cannot be ignored. Partner Promotion
  32. 32. The New Rules of eCommerce Be Responsive Any new eCommerce development needs to be optimised for the mobile shopper at its core. With mobile transactions now accounting for nearly a quarter of all transactions, a mobile optimised shopping experience is no longer a nice-to- have, it’s a fundamental requirement to avoid losing sales. A best-practice approach to optimising your online store for mobile visitors is to ensure your eCommerce product includes responsive website templates that can seamlessly and automatically adjust content for display on smartphone, tablet and desktop computers. Be Flexible Retail is fast-moving, and constantly changing. From seasonal campaigns, to limited-time offers, your webstore will need to be flexible enough to change appearance to support your promotional calendar and campaigns. Choosing an eCommerce product that allows you to dynamically change templates and themes to keep your store fresh will help keep your customers engaged and converting. Be Fast eCommerce is convenience shopping, and what could be more inconvenient than having to wait for pages to load on a slow website? Make sure you choose an eCommerce product that is speedy and high performing. “From seasonal campaigns to limited-time offers, your webstore will need to be flexible enough to change appearance to support your promotional calendar and campaigns.” Be Solid If everything goes well, your webstore will be inundated with eager customers looking to buy from you online. This may happen because of a campaign, an offer, or a sales event, and when it does, your eCommerce product had better be up to the job. Introducing Codagenic eCommerce Codagenic eCommerce is everything you need to run your online store, featuring out-of-the-box mobile and tablet optimisation, multi-site management, product search, bulk import, the ability to integrate with ERP and CRM systems and tablet-friendly administration. Built on robust Microsoft ASP .Net technology, Codagenic eCommerce is your engine for eCommerce growth. Codagenic eCommerce 3.0 is a fast, flexible, robust eCommerce platform for ASP.Net developers, agencies and retailers requiring an integrated eCommerce solution. Content provided by Codagenic. Reactive has partnered with Codagenic for eCommerce software to power many high-performing online retailers including: Rip Curl Australia, Crumpler Bags, Emu Australia, Bras ‘N’ Things and GAZ MAN. Perspectives 2013 33
  33. 33. SoDA Digital Marketing Outlook Digital marketing sophistication continues to grow both on the client-side and within agencies. With that sophistication, clients are indicating they are looking to maintain or grow their investment in digital channels. Partner Promotion
  34. 34. SoDA Digital Marketing Outlook One of the biggest questions dealt with in this year’s SoDA Digital Marketing Outlook Survey (which had 814 respondents, a mix of clients and agencies) was about specialisation, and whether specialist digital agencies are the future for delivering online and multi-channel marketing. The consensus view among clients was that specialisation is the future of agency engagements, with only 11% of client respondents suggesting a lead integrated agency is their preference over managing specialists. “How would you describe the digital marketing sophistication of your organisation?” (posed to client-side respondents) Fifty-six percent of client side respondents describe their organisations as sophisticated or very sophisticated when it comes to digital marketing, an assertion that a large cross- section of agency and production company respondents support. Projected Budget % Respondents We’re decreasing our digital marketing budgets 11% We’re maintaining the status quo 34% We’re increasing our digital marketing budgets without increasing overall marketing spend (reallocating existing budget into digital) 39% We’re increasing our digital marketing budgets and increasing our overall marketing spend 16% Other (please specify) 0% “Which of the following best describes your organisation’s approach to managing and executing digital marketing with agency partners?” Nearly 30% of client respondents indicated they were increasing agency investments in digital marketing efforts this year. This is not only a testament to the fact that the global economy has shown signs of improvement but also to the realisation that digital provides a strong value within an organisation’s overall strategy. 44% We’re maintaining the Status Quo 28% We’re Increasing our Agency Investments 14% We’re Decreasing Our Agency Investments Over Time 14% Doesn’t Apply to Us 5% Very Unsophisticated 12% Somewhat Unsophisticated 22% Very Sophisticated 26% About Average 34% Somewhat Sophisticated 1% No Opinion Perspectives 2013 35
  35. 35. Perspectives 2013 10 SoDA Digital Marketing Outlook Assignment Structure % Respondents We rely on one or more full-service digital agencies to handle digital marketing assignments 16% We maintain a roster of highly specialised digital agencies (search, mobile, social, etc.) 29% We maintain a mix of full-service and highly specialised digital agencies. 23% We work with a lead agency that handles all digital and traditional assignments 11% Doesn’t apply 21% Thinking about the advertising industry broadly, do you agree or disagree with the following statement: “The best route to growth is through specialisation (either by industry vertical or digital services offered) versus a general full service approach.” A majority of digital agency respondents (56%) agreed that specialisation offers the best path to growth as opposed to 32% of respondents from full-service agencies. While it’s not unexpected that a majority of full-service agencies would disagree with such a statement, it was somewhat suprising that so many actually agreed. In other words, almost one third of respondents from full service agencies said they thought the best route to growth is through specialisation, suggesting they are not particularly bullish on their own business model. Key Insight Most clients are migrating toward a roster of highly specialised digital agencies, signaling that digital agency ecosystems will likely become more crowded in 2013 and beyond. 56% Agree 39% Disagree 5% Don’t Know/No Opinion Digital Agencies 32% Agree 51% Disagree 17% Don’t Know/No Opinion Full Service Agencies with Digital Capabilities Where Digital Marketing Skills Reside Now (and in the Future) — Clients Respond Many clients are adopting an “innovate out of house” and “maintain in house” approach to their digital marketing efforts, a fact that will wield a major impact on talent needs on both agency and client sides in 2013 and beyond. SoDA Digital Marketing Outlook 36
  36. 36. SoDA Digital Marketing Outlook Internal Your lead agency partner Your lead digital agency* A niche agency, production company or vendor Other Now Future Now Future Now Future Now Future Now Future Paid channel expertise/strategy (PPC, display, TV etc.) 47% 40% 24 22% 7% 19% 9% 14% 13% 5% Paid channel execution 33% 39% 33% 23% 13% 20% 9% 10% 12% 8% Earned media expertise/strategy (social, WOM, etc) 45% 46% 17% 17% 19% 24% 9% 8% 10% 5% Earned media execution (community management, blogger outreach,etc) 46% 44% 20% 24% 11% 16% 13% 11% 10% 5% Owned media expertise/strategy (sites, mobile sites, mobile apps, social brand channels) 43% 41% 28% 29% 14% 16% 6% 12% 9% 2% Owned media execution (and maintenance) 41% 45% 35% 20% 11% 24% 7% 7% 6% 4% User experience 49% 51% 21% 19% 16% 17% 9% 11% 6% 2% Product/ service innovation 56% 53% 17% 19% 14% 22% 7% 4% 6% 2% Brand monitoring and management 55% 50% 16% 19% 15% 19% 7% 8% 7% 4% *If not the same as your “lead agency partner” This table combines the following two survey questions posed to client-side respondents: “In your organisation, where do the following skill areas primarily reside?” (Now) “In your organisations’s long term perspective, where will the following skill areas primarily reside?” (Future) “Agree or disagree: the best route to growth is through specialisation?” Perspectives 2013 37
  37. 37. The Rise of eCommerce in Asia Ruth Henry Product Development Manager, Melbourne For retailers looking to boost flagging revenues and tap into new markets to help achieve growth, Asia represents a huge opportunity as economies there strengthen and consumers become increasingly connected.
  38. 38. The Rise of eCommerce in Asia Six of the ten most populace countries in the world are in Asia. The two largest (China and India) account for nearly a third of the global population between them. With such a large population, it’s no surprise that the Asia Pacific region accounts for more than half of all retail sales. However, there is a significant gap between the total retail volume and the share of online sales in Asia, with eCommerce sales accounting for only 32% of global online retail. As a retailer looks to expand online into Asia, there are significant barriers to address. These include: • Internet access within Asian countries • Localisation and translation of marketing and merchandising for a global market • Taking payment in cash-based economies • Fulfilment and logistics of delivery • Customer service and support • Coming online With a rapidly growing population, many Asian countries are suffering from infrastructure issues that prevent universal access to fixed-line telephony. In many countries, mobile access to the Internet is the only method for coming online. This fact means that for a large proportion of Asian customers, their only opportunity to conveniently buy from you online is via mobile devices such as smartphones, tablets and laptops computers with wireless broadband connections. This focus on mobile access in Asia means a mobile-first strategy for retailers targeting Asian customers is required. By designing your store using Responsive Design techniques, you ensure shoppers can access your products and buy easily whether they are on a mobile device, tablet or laptop computer. Translation and Localisation The saying for trying to do too much with not enough resources (“boiling the ocean”) is incredibly relevant to the problem of localising an eCommerce store for multiple countries. The problem is that trying to manage the translation of a large, frequently changing product catalogue adds enormous overheads and resource requirements. “As a retailer looks to expand online into Asia, there are significant barriers to address to ensure growth in this expanding new market.” 1. Economist Intelligence Unit 2. Paypal/Mastercard: rise-of-ecommerce-in-asia-15675831 2 1 Perspectives 2013 39
  39. 39. The Rise of eCommerce in Asia As an alternative, some retailers have taken to translating and localising key elements of the interface, including shipping address, payment details, calls to action (such as the ‘Sign In’ buttons, ‘Add to Cart’ and ‘Checkout’ features), without actually translating every single product detail. This ensures that customers can easily transact and buy following the prompts in their own language, even if product details aren’t fully translated. The Problem of Cash A significant barrier to shopping online in Asia has been the extremely low penetration of credit cards and the lack of online payment options, particularly in mainland China, where the ability to provide online payments and merchant services is tightly regulated. With many Asian retailers offering cash-on-delivery, bank transfers or in-store pick up as alternatives to credit card payments, international retailers are at a significant disadvantage unless they are able to provide similar options. As a solution, there are a growing number of payment providers offering online payment solutions to international retailers, such as China’s UnionPay and AliPay (Part of Alibaba). Delivering the goods Along with the difficulty of taking payments, actually delivering the goods to customers can be difficult in Asia. With poor infrastructure and large distances, delivery can be expensive and take a long time. International retailers need to consider alternative options for delivery, such as delivering to central pick-up locations or stores for collection. Customer Support Finally, trading with international customers can be difficult. The issues of timezones and language compound customer support issues. Consider investing in comprehensive customer support systems such as FAQs and Q&A solutions that can be translated to minimise the need to provide telephone support or look for local support providers who can act as agents for you in Asian markets. Be sure to continually improve your local language support content by identifying frequently asked questions or support issues, and proactively use email and other digital channels to address concerns before they arise. Not only will you reduce the amount of in-bound enquiries you have to deal with from overseas customers, you’ll improve the satisfaction and perception of service from your existing customers also. The opportunity will be worth the effort Asia represents such an enormous opportunity for retailers, with more than half of the global “middle class” predicted to reside in the APAC region by 2020. To capture such a fast-growing and affluent market, retailers need to be actively developing their Asian marketing and merchandising strategies now. The Rise of eCommerce in AsiaPerspectives 2013 40 If you’re interested in talking about eCommerce in Asia, please contact us.
  40. 40. The Future of Connected Retail Bradley Grinlinton Managing Director, London Retailers around the globe last year saw the beginnings of a revolution on the high street as they sought to find new and interesting ways to utilise digital technologies to improve the in-store shopping experience, making it more relevant to digitally-savvy shoppers.
  41. 41. The Future of Connected Retail In 2012, retailers such as Marks and Spencer and Tesco experimented with engaging and inspiring customers through interactive kiosks and in-store wifi offerings. Brazilian fashion retailer C&A brought social into stores by including Facebook ‘likes’ on the coat hangers of products. Aurora fashion brands Oasis and Warehouse went down a more transactional path by enabling customers to pay for their in-store purchases using PayPal. Burberry took connected retail even further by designing an entire store around the online shopping experience. For a small group of retailers, connected retail is already a part of the marketing mix. But with changing consumer expectations alongside advances in technology, this revolution needs to go mainstream. Retailers have to start thinking more seriously about better integrating digital technologies across the whole customer shopping journey and how they can use such technologies to leverage existing customer behaviours. Only in this way will they create the types of useful and engaging experiences that will give customers a reason to get off the sofa and do their shopping on the high street. Three of the biggest connected retail opportunities available right now can be used to create exciting and useful experiences for in-store shoppers. Augmented reality that actually augments reality Until now brands have been content to use augmented reality as a novel and at times entertaining campaign element where celebrities spring forth from the cover of your favourite magazine or your dream car is virtually parked in your driveway through the magic of your smartphone. Even some of the more practical applications of the technology such as virtual changing room solutions still require a user to be in front of their computer and add little value in an in-store context. But the technology already exists for retailers to remarkably enhance in-store experiences in line with already existing customer behaviours. Picture a customer in their local grocery store using their smartphone to browse an aisle of ingredients by recipe, nutritional value or dietary requirements, while another customer is using their smartphone to scan an otherwise homogeneous row of big screen televisions by viewing their respective customer ratings. Or imagine a smart mirror in a changing room (similar to those used in Burberry’s flagship digital store) being able to recommend complimentary items to a person’s style, which “Picture a customer in their local grocery store using their smartphone to browse an aisle of ingredients by recipe, nutritional value or dietary requirements.” Perspectives 2013 42
  42. 42. The Future of Connected Retail the shopper can order to their changing room at the touch of a button. The mirror then takes a photo of the customer in their chosen outfit and sends it to their smartphone to share with their friends via Facebook. This is true augmented reality. Automating customer service to deliver online convenience in-store If you’ve ever been faced with the experience of trying and failing to get a sales assistant’s attention on a Saturday afternoon in any high street store, then you’ll acutely understand the attraction of shopping online from the comfort of your sofa. Rather than having to ask for an item in my size from a sales associate who then uses a computer to locate it, a better customer experience would enable me to use my smartphone to scan a product’s barcode and automatically see stock levels for the product. If for some reason they don’t have my size, I’ll be shown other stores that have it and automatically be able to reserve it for pick-up or placed on order for delivery. And if I do find what I’m looking for, why join the queue to pay when I can simply process the transaction myself via mobile wallet technology? Brands like Apple understand the need to bring these levels of online convenience to the in-store shopping experience and already live and breath an automated approach to customer service in their flagship Apple Stores. Meaningful personalisation, relevance and loyalty Online retailers like understand personalisation and have it built in every element of their business model. They take note of what I browse and what I buy and tailor marketing messages to me to make my interactions with them more relevant. As a result, I’m more likely to buy. Unfortunately the same cannot be said for most bricks and mortar retailers. More often than not, customers are treated anonymously despite being a loyal and regular shopper, unless they are willing to join a formal loyalty scheme. But it doesn’t have to be this way. Location-based services or user-activated check-ins can tell retailers if someone is in their store and when, enabling them to target customers with relevant in-store offers and information. If a person visits consistently, messaging can become even more relevant based on the assumption they are a regular consumer. Perspectives 2013 The Future of Connected Retail 43
  43. 43. The Future of Connected Retail “Location-based services can enable retailers to target customers with relevant in-store offers and information.” Using technologies like NFC, RFID and mobile wallets, personalisation in-store can become even more powerful and relevant as retailers are able to identify customers and their purchase histories and shopping preferences to a much more in-store level. Simply walking by a product that has been identified as being suitable for me based on my purchase history can instantly trigger a message to prompt me to try the product in question. Using the same technologies, rewards for loyalty can be made more instantaneous and need not be tied only to purchase as many existing card-based schemes are. Imagine receiving a notification on your way to the checkout that you’ll receive 10% off if you add another item to your basket or receiving a voucher to say thanks for your loyalty moments after you’ve left a store. Surely that sounds better than a voucher in the post on your birthday and the odd generic newsletter? Perspectives 2013 44
  44. 44. Thoughts?
  45. 45. Thoughts? We hope you enjoyed this edition of Perspectives. Please share your thoughts with us @reactive using #perspectives2013, or find us on Facebook. Melbourne Phone: +61 (0)3 9415 2333 Email: Sydney Phone: +61 (0)2 9339 1001 Email: London Phone: +44 (0)20 7550 8200 Email: Auckland Phone: +64 (0)9 309 5696 Email: New York Phone: +1 (718) 801 8040 Email: Perspectives 2013
  46. 46. Perspectives 2013 47 47 Chapter Heading