Don’t Panic! Personalization in Perspective

Posted by on May 9, 2014 in CPG, Digital Strategy, Learning, Loyalty, Online Coupon, Online Grocery, Online Marketing, Personalization, Sliderpostings | 0 comments

The bandwagon of the day is PERSONALIZATION. Everyone who is anyone is modifying position statements and priorities to be a world-class leader in it. But before you launch your organization into “must have a proprietary personalization engine right now” panic mode, please consider the following: 1. Personalization – as a means to organize how you present content – is an optimization tactic, not a strategy. Your survival as business and your ability to effectively serve your customers might not depend on having absolutely the best, proprietary personalization engine in the galaxy. Personalization may not even make sense for you. 2. Personalization is most effective if you have thousands of “quality” content units for it to prioritize – the more the better. If you had the best personalization engine in the galaxy and it was only personalizing a hundred units of average content, there might be little to no optimization effect at all on your business (depending upon the media you are personalizing on). Think about the number and variety of content units Amazon is choosing from to create your personalized experience – how would you grade them? How does your relevant content database compare to that of Amazon? 3. “Freshness” of content also impacts the effectiveness of your personalization engine. Facebook, Pinterest, Instagram and select news/curation services have arguably the best personalization potential because their inventory of content is both vast and continously fresh. If they didn’t have both, they would never be able to sustain the frequency of consumer engagement that they do – with or without personalization. If you have or are trying to achieve frequent engagement, without either a vast or fresh inventory, the impact of personalization will be less impressive and possibly even detrimental to your brand. Online dating sites have this challenge if a new member logs in too frequently – satisfaction and engagement will decrease. This isn’t because their matching (or personalization) algorithm is bad, it’s because they don’t have enough continuously fresh inventory to sustain the value proposition. (Insert snarky comment about online dating here, if you wish.) And here’s another thing about frequency – if you’re only going to rely on derived data (i.e. purchase or browse data or other insight proprietary to you), the more frequent the visits the better that data set is. If a consumer engages with you weekly, you can make conclusions about them with much greater confidence than if they only engaged with you quarterly – for example. 4. The personalization algorithm, by itself, is unlikely to ever be a point of sustainable competitive advantage for most companies – unless your proprietary algorithm is also pulling from a proprietary (meaning nobody else has anything like it)...

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Upstream Insight on the Latest Ecommerce Trends (Common Sense)

Posted by on Apr 29, 2014 in Amazon, CPG, Digital Coupon, Digital Strategy, innovation, Inspiration, Leadership, Online Coupon, Online Grocery, Retail Disruption, Walmart | 0 comments

This chart makes complete sense to me. Ecommerce provides the highest consumer value when the item you are looking for is hard to find (in geek speak, we would say it has a relatively low purchase incidence among the general population).  A compelling consumer value proposition would be most difficult for ecommerce in retail verticals where the purchase incidence is very high and therefore the items are very reliably found in nearby stores (in plain speak – everyone buys food, most people buy shampoo and toothpaste, so your neighborhood market or drug store is likely to carry what you need). In the case of high purchase incidence product categories (food, toothpaste, toilet paper, shampoo) the cost of having to wait for the to be delivered vs. the benefit of getting exactly what you want  is higher than the cost of stopping in the store on your way home from work and having it within a few hours or a day of realizing you needed to buy more. You are also less interested in these items and are probably going to spend less time researching/browsing online than in other categories which have migrated to ecommerce faster. Other than logistic challenges, this is why Grocery and Drug have been slow slow to migrate to ecommerce. All ecommerce companies have to do is continuously improve that consumer value proposition to capture an increasing share of increasingly large retail sales…and they will. Susan O’Neal Gear has over 20 years of experience at the intersection of consumers, marketing and technology. Passionate about all aspects of a consumer’s relationship with brands and retailers, we’re spending the next year looking for new, groundbreaking thought leadership  – if not disruptive solutions – with the potential to redefine the parameters of consumer loyalty. If you also want to see some game changing happen -then follow Upstream Insight, contribute your voice, share this post…do...

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Coupon Fatigue? Don’t give up now!

Posted by on Apr 23, 2014 in CPG, Digital Coupon, Digital Strategy, Inspiration, Load to Card, Loyalty, Online Coupon, Online Grocery | 0 comments

In no area of marketing does innovation have greater potential to positively and significantly impact the daily lives of more people than in the weekly task of GROCERY SHOPPING.  And yet for all the money, technology, data and brainpower invested, we have very little to show for it as an industry (no offense to those who have been trying, I’ve been right there with you for more than a decade). The best opt-in rates for digital consumer engagements in grocery are less than 10% (lower than that on average).  Maintaining that engagement is a whole other challenge. Most grocery consumer engagement is funded through and by digital couponing, a tactic that appeals to less than 15% of U.S. Households on an ongoing basis and is currently “out of vogue” with brands desperate for new ways to build brand value (and profit margin). Less than 1% of Grocery sales occur online (although this is changing, more on that in another post later). As a result, there are literally billions of brand and retail marketing dollars stuck in increasingly inefficient marketing channels – not because they don’t want to go online (many famous pronouncements have been made to move budget dollars online over the last 15 years) – but no existing solution has the scale to spend that kind of money (not even the biggest dogs in the digital CPG fight). Never, never, never has there been a spending population more patient and willing to test nearly anything and everything – and the fact that there has been no true game changer – well, I’ve literally seen it break hearts. The heart breakers – “great ideas” that turned out to be not-so-great; super cool companies with value propositions that left consumers cold; hot and hungry teams  that turned out not so “hot” at follow-through; “game changers” and “killer apps” with funky or ambitious names that … in the end …have struggled to deliver the only things that really matter: meaningful, scalable, repeatable impact on volume of units moved “brand value” creation store preference and retailer share of their customer’s spending. Many of the pioneers, thinkers, doers, and innovators that I’ve run across along my journey have given up – clients and colleagues – they call it “coupon fatigue” (because a lot of these efforts centered around varying consumer currencies like coupons). They jump out and start businesses in other industries, where the ground is more fertile for innovation…and the consumer value proposition is, quite frankly, easier to deliver. But it’s not the time to give up! It’s time to admit that (I hate to say it), is going to take a village. We need to pool together the collective insight from our...

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Coupon Fatigue? Calling All Digital Grocery Coupon Burn-Outs!

Posted by on Mar 4, 2014 in Brand eCRM, Burnout, Consulting, CPG, Digital Coupon, Digital Strategy, Learning, Load to Card, Loyalty, Online Coupon, Online Grocery, Online Marketing, Printable Coupon | 0 comments

In no area of marketing does innovation have greater potential to positively and significantly impact the daily lives of more people than in the weekly task of GROCERY SHOPPING.  And yet for all the money, technology, data and brainpower invested, we have very little to show for it as an industry (no offense to those who have been trying, I’ve been right there with you for more than a decade). The best opt-in rates for digital consumer engagements in grocery are less than 10% (lower than that on average).  Maintaining that engagement is a whole other challenge. Most grocery consumer engagement is funded through and by digital couponing, a tactic that appeals to less than 15% of U.S. Households on an ongoing basis and is currently “out of vogue” with brands desperate for new ways to build brand value (and profit margin). Less than 1% of Grocery sales occur online (although this is changing, more on that in another post later). As a result, there are literally billions of brand and retail marketing dollars stuck in increasingly inefficient marketing channels – not because they don’t want to go online (many famous pronouncements have been made to move budget dollars online over the last 15 years) – but no existing solution has the scale to spend that kind of money (not even the biggest dogs in the digital CPG fight). Never, never, never has there been a spending population more patient and willing to test nearly anything and everything – and the fact that there has been no true game changer – well, I’ve literally seen it break hearts. The heart breakers – “great ideas” that turned out to be not-so-great; super cool companies with value propositions that left consumers cold; hot and hungry teams  that turned out not so “hot” at follow-through; “game changers” and “killer apps” with funky or ambitious names that … in the end …have struggled to deliver the only things that really matter: meaningful, scalable, repeatable impact on volume of units moved “brand value” creation store preference and retailer share of their customer’s spending. Many of the pioneers, thinkers, doers, and innovators that I’ve run across along my journey have given up – clients and colleagues – they call it “coupon fatigue” (because a lot of these efforts centered around varying consumer currencies like coupons). They jump out and start businesses in other industries, where the ground is more fertile for innovation…and the consumer value proposition is, quite frankly, easier to deliver. But it’s not the time to give up! It’s time to admit that (I hate to say it), is going to take a village. We need to pool together the collective insight from...

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