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Back to the Future: How Digital Marketing Could Resurrect Main Street

Retail brick and mortar transformation buyer consumer customer sales advertising Back to the Future Digital Marketing Resurrect Main Street

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Back to the Future
How Digital Marketing Could
Resurrect Main Street
Dave Sutton
February 6, 2019
@TOPRIGHTPARTNER /TOPRIGHT/IN/MARKETINGSCIENTISTS
Back to the Future
Retail Experiences Before the Internet
Retail Experiences Before the Internet
Personable: they knew your kids’ names
Trusted: they knew what you needed
Local: they knew your neighbors
Knowledgeable: they knew their category
Social: they enjoyed seeing you
Marketing Was Uniform, Persuasive, Transactional ...
Broadcast
Back to the Future Part II

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Back to the Future: How Digital Marketing Could Resurrect Main Street

Editor's Notes

  1. What will retail marketing look like in the future? Pure A.I.? All automated? Rooted in IoT? Big question… But to find the right answer, I want to go back and take a look to what it used to be—back to Main Street.
  2. [Recount personal Dave Sutton anecdote about the retail of childhood] Personable, Trusted, Local, Knowledgeable, and Social
  3. [Recount personal Dave Sutton anecdote about the retail of childhood] Personable, Trusted, Local, Knowledgeable, and Social
  4. Though the marketing could be great, it was often uniform, persuasive, and transaction focused. Print ads, bus shelters, billboards, fliers, catalogs, coupons—they didn’t aspire to much but sales. The customer was not the hero. The brand was the hero. But since the internet, things have changed… right?
  5. …But have they? Digital marketing has fallen into a familiar trap. Uniform. Generic. Transactional. It’s all about sales. The customer is still not the hero. It’s not just generic, it’s annoying. It’s interruptive. So what are digital marketers doing wrong?
  6. And where are we going? Minority Report, made 17 years ago. It still represents how people often conceive of digital marketing. Their fears, their anxieties, and how they’re trained to fear the invasiveness of digital advertising. [show clip: 1:01] Steven Spielberg’s Minority Report, 2002. Much of the technology in that clip was pure science fiction back then. Today, much of it actually exists. So don’t consumers have the right to feel a little anxious? Don’t you?
  7. Retail marketing has new challenges It lacks the human touch It’s interruptive and doesn’t put the customer first It makes ineffective use of digital tools like A.I. and facial recognition And customers use ad blockers more and more frequently. As a result, fears about privacy, ubiquity, and invasiveness prevail just as they did in 2002. And things are even getting worse.
  8. Retail marketing has new challenges It lacks the human touch It’s interruptive and doesn’t put the customer first It makes ineffective use of digital tools like A.I. and facial recognition And customers use ad blockers more and more frequently. As a result, fears about privacy, ubiquity, and invasiveness prevail just as they did in 2002. And things are even getting worse.
  9. The headlines bear this out. Adweek wrote about a study that said that 57% of people hate pop ads. Close to half would abandon a commercial website in light of this kind of advertising. We’re not thinking enough about the possibilities of digital marketing. Is it taking us to a future of alienation and interruption? Or can we use it differently? Can we use digital marketing to make the customer the hero? We need to think differently. Digital tech can team up with marketing to bring us back to Main Street.
  10. But what do I mean by Main Street? I don’t mean nostalgia. I don’t mean Andy Griffith. Automation and A.I. can be integrated into daily life in a positive and useful way that returns us to a sense of community. But to reintroduce marketing to the power of the human touch, we need to make use of five core concepts: Conversational Curation, Emotional Relevance, Shared Value, Predictive Connectivity, and Genuine Purpose.
  11. “Conversational commerce” The personalization of every interaction, a curated basket of choices that’s based on market insights and customer preference Lolli and Pops A San Fran candy store founded in 2012 that has one-of-a-kind sweets and customizable gift boxes.
  12. Mobica A facial recognition loyalty program. Customers that opt in to the program walk into a store, and a RealSense 3D camera recognizes their face and sends the info to an app on the sales associate's tablet. With that data, the associate accesses the individual's taste profile, allergies, and other information, and offers personalized product recommendations via AI-enhanced analytics. The benefits It’s not interruptive or invasive. It’s a method of brining the sales associate and the customer together in person. Shift from “May I help you” to “I can help you” By making the customer the hero, the bond between vendor and customer is strengthened.
  13. How to Get It Wrong Be impersonal: According to an Accenture study, 44% of consumers believe retailers fail to deliver relatable, personalized experiences. Be intrusive: 92% of consumers are worried about their online data privacy but nearly 7 in 10 want a personalized shopping experience Be overeager: No one wants to get an offer for greater savings just after they’ve recently made a purchase. Give it time. Counterexample: Amazon equipping their Ring video doorbells with facial recognition. The bells were meant for convenience and ease of delivery, but were also promoted as a way to track “suspicious people.” Amazon was immediately and widely criticized in the press for this.
  14. Emotional Relevance Shopping experience moves beyond the merely transactional Builds human connection Brands use data to go directly to customer so they can see products and services in a relevant context Sephora A French world-class beauty retailer founded in the 1970s with global locations.
  15. Sephora Visual Artist 3D facial recognition software in the Virtual Artist Augmented reality feature allows users to view themselves in real time with digital versions of the real make-up products available at all Sephora stores. Allows customers to try before they buy—from anywhere and reduces transaction time. The Benefits The app creates an emotionally relevant and powerful connection to Sephora Allows customers to be the stewards of their own experience as they explore Sephora products. When the customer is the hero again, the brand sees long term benefits in brand loyalty and consistent sales
  16. How to Get It Wrong Be disruptive: Emotional relevance smooths out the customer experience by addressing needs in advance. Interrupting customers with pop ads does the opposite. Be transactional: The physical space must have real value in customer experience as a platform for long-term relationships. Research shows a 22% drop in conversion rates occurs when virtual products don’t line up or appear correctly. Be emotional for emotion’s sake: Focusing on an emotion without making that emotion relevant. Always use the customer as your guide and use technology to reflect how they feel. Don’t force feelings onto them. Counterexample: The Dow Chemical “Human Element” ads. These well-produced movie-quality TV spots were stunning and engaging—but they did not meet the customer where they were. They had zero reason to feel the emotion they were being prompted to feel (“amazement” “wonder”) and therefore did not respond to the campaign.
  17. Shared Value: New economy based on access rather than ownership. Sharing assets is the norm. Customers demand instant, short-term access, and they want to know how products will be re-used/re-cycled. Rent the Runway An online service, which recently opened in brick and mortar, Rent the Runway provides high-end dress and accessory rentals. Founded in New York City in 2009 by Jennifer Hyman and Jennifer Fleiss.
  18. Omnichannel Apparel Rental Allows people to rent designer outfits for special occasions from an inventory of thousands of designer outfits for a low one-time or monthly rate. The need for a single occasion outfit that could cost thousands The ability to find and wear otherwise unaffordable labels The Benefits The shop prioritizes customer needs and provides access where before there was none. By meeting customers where they are, Rent the Runway is like a close friend with a great wardrobe. This ensures return customers and long-term loyalty.
  19. How to Get It Wrong: Be inauthentic: Using iPhones and automation for shared services requires trust, and that in turn requires a real investment on the part of brand leadership to authentically care about the services and the social cohesion it promotes. Be over polished: When you bring high-end goods to ordinary customers for rentals, they’re aware that they’re gaining access to goods they can’t really afford. Approach them on their level and don’t focus overmuch on exclusivity—this runs counter to shared value. Be unaware of unintended consequences: Things can go wrong when people suddenly have access to lots of products. Think through how this will work out in society and let that be your guide… Counterexample(s): In Atlanta and other cities, the three or four electric scooter companies (Bird, Lime, among others) have ended up leaving piles of scooters all over the city. In China, an umbrella sharing service quickly went out of business because umbrellas were lost, stolen, or forgotten.
  20. Predictive Connectivity: The ubiquity of connections allows brands to productively, authentically, and relevantly interact with customers. Enabled by A.I., machine learning, geo-location, and advanced sensor technology, Internet of Things Vineyard Vines A clothing and accessory retailer founded by Shep and Ian Murray in 1998.
  21. Bluecore “predictive audiences” The platform enables VV to send dynamic, personalized messaging based on customer behavior and level of personal engagement with the brand. It eliminates the need for batch-and-blast campaigns, messy customer relations, data storage, and allows VV to track and use critical data on thousands of customers. The platform also allows VV to expand their reach to new audiences. The Benefits With VV opening new brick and mortars, the data collection and analysis tools speed up and improve knowledge of the existing customer base. Makes relationships easier and better whether online or in store. Makes the customer the hero and strengthens vendor-customer relations in the long term.
  22. How to get it wrong: Be undisciplined: points of contact v. points of real connection. Use the latter wisely and don’t over- or underwhelm existing or potential customers. Be creepy: Don’t track people, bother them, or ad bomb them. When you do, all customers think about is that Minority Report clip. Be interruptive: A study by Accenture noted that bad personalization cost US companies some $756 billion and $2.5 trillion globally. Counterexample (s): Too many to count. How many of you still get email ads for credit cards you already own, or telecom services you already have? AT&T, CitiBank, British Airways, New York Times. A specific example might be the un-ironically named sportswear company Fanatics. There have been reports of people receiving up to 14 emails in a few days from Fanatics. Needless to say, be less fanatical. Sell more of your products by nurturing a real connection with the customer.
  23. Genuine Purpose: Brands must be customer-centric, providing simple, clear, and fully aligned experience to customers.  Customers increasingly demand that brands become real citizens and reflect community values. Patagonia An extremely popular American outdoor clothing retailer founded in 1973 in California. Their marketing strategy is rooted in its ideals.
  24. Brand Activism CEO Marcario: “Doing good work for the planet creates new markets and makes [us] more money.” Patagonia stopped making pitons, the spikes used by climbers and a mainstay in the business, because they were bad for the environment. That’s genuine purpose. Edelman study: 86% of consumers believe that business should place equal weight on society’s interests as on its own. Further, 62% would switch brands if another of similar quality supported a good cause. Patagonia is proof of the power of genuine purpose to create authentic relationships with customers. The Benefits Brand purpose itself becomes a marketing tool—as long as it is truly genuine. Authentic and fully aligned. Nurtures a real connection with the customer and shores up long-term sales.
  25. How to Get It Wrong: Be self-righteous: Be preachy, be pushy, or be two-faced in your support of a political line. If you’re doing genuine purpose right, it comes out naturally, not by force. Be too topical or trendy: Customers can tell when you’re just jumping on a band wagon—and they won’t like it. You lose trust and you lose customers. Be disingenuous: Every aspect of the brand must be consistent and aligned with the promise and purpose of the brand. A purpose is either in your DNA or it’s not. Counterexample: The Pepsi ad with Kendall Jenner, which did nothing but infuriate thousands of Pepsi drinkers. The ad was self-righteous, trendy, and disingenuous all at once. Stay away from this kind of marketing at all costs.
  26. Using these five core concepts, retailers can move away form that Minority Report future and instead begin to use digital marketing to nurture real connections with customers. Digital marketing tools are ideal for placing the customer at the center of your brand. Will we go back to some imagined time in the past when things were better and everyone was happy? No. We will enter into a new and better hybrid future in which technology is used for the common good and reintroduces the human touch back into retail sales.
  27. To embrace an integrated, hybrid future in which brick-and-mortar and online consumer spaces powered by A.I. reinvent the market, retailers need to apply their imaginations to digital tools using the five core concepts: Conversational Curation: Conversational, customized curation of choices based on the needs and personality of the customer. Emotional Relevance: Bonds with the customer in a authentic and meaningful way. Shared Value: Meets customers on their terms and offers relevant access. Constant Connectivity: Reveals and predicts new ways to connect with customers. Genuine Purpose: Unites the brand with relevant social values and traditions If not, just as marketers once scrambled to exploit the advantages of color photography, mistakes will be made…
  28. … and they wont be pretty. A lot can go wrong in marketing. Don’t say I didn’t warn you. As marketers, we can either produce the right stuff according to the tools we’re provided, or we can rush into things and produce second-rate work. Promoting marketing collateral that is ugly, unproductive, and unprofitable is never necessary. My hope is that we see beyond the fears and the foibles and flaws of hi-tech digital marketing to a better future. I’ve seen it happen. I know it works.
  29. By making the customer the hero you create a commercial environment that isn’t just powered by machine learning and digital tools—you make one that uses those tools for a better world. Through the use of Customized Choice, Emotional Relevance, Shared Value, Constant Connectivity, and Genuine Purpose, you empower relationships among people and between retailers and their customers.s With the help of digital tools, you bring a new day to market. You bring Main Street back to life.