DM Magazine April 2022

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Creative Use of Direct Mail Today

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11 DataBacked Retail Trends PM 4 0 0 5 0 8 0 3

VOL. 35 • NO. 4 • APRIL 2022

THE AUTHORITY FOR THE DATA-DRIVEN BUSINESS

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Gain a fresh perspective on Canada’s distinct communities and markets

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// 3 ON THE COVER Vol. 35 | No. 4 | April 2022

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11 Data-Backed Retail Trends to Help You Succeed in 2022 and Beyond

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Legends Among Us: Canada’s Marketing Hall of Legends names 2022 winners

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THE MAILBOX AS THE NEW MALL

How Creative Marketers Use Direct Mail Today

Building Next-Generation B2B Sales Capabilities

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Online Shoppers in Five Major Markets Share eCommerce Insights DMN.CA ❰

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SiriusXM Canada and Live Nation Canada team up to bring exclusive live experiences to fans.

Alexisonfire is going to kick off a long-term partnership with a free concert at Live Nation’s History, said SiriusXM Canada. The new multi-year partnership make’s them Live Nation Canada’s official audio music streaming partner. The strategic partnership will shine a spotlight on live music and comedy events from coast-to-coast in 2022 and beyond with SiriusXM bringing on-site perks, activations, broadcasts and more to fans and SiriusXM subscribers.

“SiriusXM and Live Nation believe in the special connection live entertainment creates, and this partnership will expand our content and provide even greater access to must-see shows, giving SiriusXM subscribers and fans the opportunity to rediscover the experience of in person events,” said Paul Cunningham, SVP, Sales & Marketing, SiriusXM Canada. “Our content is more than just a playlist and gives subscribers access to exclusive interviews and performances by some of the world’s biggest stars. We look forward to adding even more amazing artists to the mix.”

“Live Nation Canada and SiriusXM ❱ DMN.CA

both create one-of-a-kind entertainment experiences, which made this partnership a natural fit,” said Wayne Zronik, President of Business Operations, Live Nation Canada. “We know Canadians are eager to get out there and enjoy live events, and we can’t wait to bring these unforgettable moments to even more fans with SiriusXM.” To celebrate the partnership and return of live events, iconic Canadian rock band Alexisonfire will perform a concert – their only Toronto appearance this year – on April 27 at HISTORY, Live Nation Canada’s newest entertainment venue. The concert will be ahead of their 4-day concert series, Born & Raised, in their hometown of St. Catharines

with co-headliner City and Colour. The band’s latest album and first record in 13 years, Otherness, will be released on June 24, 2022.

Fans were given a chance to get free tickets on a first come, first serve basis beginning by visiting ticketmaster.ca. The concert will give Canadians a taste of the access and unparalleled experiences that SiriusXM and Live Nation Canada will bring to fans and subscribers through the partnership.

As the official audio music streaming partner, SiriusXM Canada will be on-site at Live Nation Canada events and venues to give fans and SiriusXM subscribers unparalleled concert experiences and access. From Vancouver to Toronto to Montreal, SiriusXM will be at select concerts at RBC Echo Beach and Budweiser Stage and several festivals including Born & Raised, FVDED in the Park and Osheaga. On-site activations will vary but include an exclusive branded lounge area, live broadcasts, VIP access and memorable fan experiences.

As part of the partnership, SiriusXM subscribers will also have a series of exclusive perks including chances to win tickets to Live Nation events across Canada or cash that can be redeemed towards event tickets at ticketmaster.ca, and more.

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Marina Glogovac departs CanadaHelps to take the role of CEO and President of Toronto Star.

The Toronto Star announced Marina Glogovac has been appointed as Chief Executive Officer and President of the Toronto Star, effective June 1, 2022. Glogovac is an outstanding leader and has enjoyed an exceptional career as a dynamic, experienced, growth-oriented executive with a passion for journalism, community and charity with an outstanding record of leading and growing companies through periods of change and intensifying competition. She brings proven experience in eCommerce, consumer and business-tobusiness technology, and in building winning content and brands.

Glogovac joins the Toronto Star after serving since 2013 as President and CEO of CanadaHelps, a leader in providing fundraising and donation technology to charities and donors. Prior to joining CanadaHelps, she had a 25-year career in leading eCommerce, technology and media companies, including as Group Publisher for St. Joseph’s Media, which included its flagship magazine Toronto Life, as CEO and Chief Revenue Officer at Lavalife Corp., as Chief Marketing Officer at Kobo Inc., and as Vice President, Sales and Marketing at Now Magazine.

Glogovac succeeds Lorenzo DeMarchi, who has been serving as interim CEO and will be returning to his previous role as Chief Investment Officer for Torstar Corporation, the parent company of the Toronto Star.

“We are very pleased that Marina Glogovac has agreed to serve as Chief Executive Officer and President of the Toronto Star,” said Paul Rivett and Jordan Bitove, co-owners of Torstar.

“With Marina we have the very best leader at exactly the right time. Her news media leadership, tech background and digital subscription experience uniquely position her to lead our journey of reinvention at the Toronto Star as we prepare to move to our new Toronto location later this year.”

Glogovac has also served on numerous boards and advisory committees, including VerticalScope Inc., 13th Round Fight for Life, The Walrus Magazine Foundation, Magazines Canada, Interactive Advertising Bureau Canada, Ontario Media Development Corporation and Bridgepoint Health Foundation.

“When I started my career in Canada at NOW weekly, it seemed a distant dream to be one day be named CEO of the Toronto Star,” Glogovac said. “Steering this cherished and critically important institution is a great responsibility and I am humbled as I accept this role. Along with the owners and every member of the team, I look forward to helping create and ensure a thriving future.

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// 5 media leadership, deep understanding of the needs of advertisers and long history of commitment to the communities will serve us well.”

The Toronto Star is the largest metropolitan daily newspaper in Canada, with more than 5.0 million readers every week in print and online (thestar.com).

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Air Transat enhances its virtual interlining service: connectair by Air Transat.

Marina Glogovac

“For 50 years, Joseph Atkinson, the legendary publisher of the Star, pursued his “community-first’” agenda with passion and tenacity while fiercely defending independence and freedom from outside influences. His courage and talent continue to inspire the Star. We are truly standing on the shoulders of giants as we pursue the Star’s future as a digital-first, subscriber- and partnership-driven media company. The Star is an icon, a jewel, and I have no doubt that it will continue to be a force in Toronto and beyond,” Glogovac added.

In a separate announcement, Torstar Corporation said today it has promoted Neil Oliver, who currently is Chief Operating Officer of Torstar, to the position as Chief Executive APRIL 2022

Officer and President of Metroland Media.

Oliver is recognized as one of Canada’s leading community and daily newspaper experts and has an impressive record of success throughout his more than 35-year career with Metroland and the Toronto Star.

In his new position, Oliver will be responsible for Torstar’s community publications, its regional daily newspapers and press operations and will be supporting the print operations of the Toronto Star.

“We are pleased that Neil has accepted this new role,” said Paul Rivett and Jordan Bitove, co-owners of Torstar. “With Neil’s experience and passion, he is perfectly positioned to lead Metroland as it moves into the next phase of its evolution. His strong background of news

The carrier has added three new airline partners to its platform, simplifying connections to more than 240 additional destinations. Air Transat, named World’s Best Leisure Airline in 2021 by Skytrax, is proud to enhance its exclusive virtual interlining service with the addition of three new European airline partners. Its innovative connectair by Air Transat platform now allows travellers to combine Air Transat flights with those of Azores Airlines, Loganair and SKY Express, bringing the total number of additional destinations available to over 240.

With this new offering, Canadian travellers can easily fly to several cities in England and Scotland, the Portuguese Azores islands and Greece. The platform already enables Air Transat passengers to combine flights to numerous destinations in Europe, North Africa, the Middle East, Central and South America, as well as in Quebec, thanks to partnerships with easyJet, Vueling, Avianca and Pascan. “connectair by Air Transat, our virtual interlining service exclusive to our airline in Canada, is a great, easy-to-use tool that enables us to quickly add trusted new partners and help travellers choose their dream holiday from an ever-expanding selection,” said Joseph Adamo, Chief Sales and Marketing Officer at Transat. “This initiative is in line with our desire to always stand out with an innovative approach focused on continuously improving the customer experience.”

The entire range of connections is now available in the airtransat.com search engine and through some flight aggregators. When booking, customers are redirected to the connectair.airtransat.com platform, which offers the best self-connection options and low fares for departure and destination cities using DMN.CA ❰

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technology developed by Dohop. The booking also includes servicing in case of flight delay or cancellation, ensuring that travellers arrive at their destination as quickly as possible.

Founded in Montreal 35 years ago, Air Transat is a leading leisure travel brand. Voted World’s Best Leisure Airline by passengers at the Skytrax World Airline Awards, it flies to international and Canadian destinations, striving to serve its customers with enthusiasm and friendliness at every stage of their trip or stay, and emphasizing safety throughout ■■■■■■■■■■■■■■■■■■

Purolator launches 2022 True North Small Business Grant Contest.

With more than $100,000 to help Canadian small businesses grow and support their communities, the launch of the 2022 True North Small Business Grant Contest following the success of the last year’s program. This year, Purolator will award grants to four winners, up from three in 2021, to continue to support even more small businesses and local community partners.

The contest offers four Canadian small businesses an opportunity to receive $20,000 in cash and $500 in free Purolator shipping

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credits along with a new “pay-it-forward” cash prize of $5,000, to be distributed throughout their community. The grant is designed to help small businesses grow and continue making positive impacts on our local communities.

The True North Small Business Grant Contest is open from April 13 to May 31, 2022. To enter, nominators must provide a description of the business, explain how it is helping strengthen Canadian communities and describe why they believe the business deserves to win.

Canadian small businesses can self-nominate while community partners and any Canadian resident of legal age of majority can nominate a Canadian small business of their choice.

Details on contest entry, eligibility requirements and frequently asked questions along with contest terms and conditions are available online at purolator.com/smallbusiness-grant.

“We’ve seen small business accounts grow dramatically over the last two years, with many taking advantage of new opportunities to expand, like moving to e-commerce service models,” said Stacey Cummings, Director, Marketing, Purolator. “Last year, we received nominations from coast to coast, in a wide variety of industries including tech, hospitality, online retailers, non-profits and many more. This year, we expect to further our reach, with nominations that continue to reflect all of the communities we serve.”

“I am thrilled and honoured to be the moderator for Purolator’s True North Small Business Grant Contest selection panel for 2022,” says Victoria Lennox, Founder and President Emeritus of Startup Canada.

“Initiatives like the grants Purolator is awarding are so important for sowing the seeds and growing the ambitions of our country’s small businesses. What drew me to get involved is that it also provides each of the four winners with $5,000 in ‘pay it forward’ community giving to make an even larger impact. This program genuinely understands the value entrepreneurs have in making a

difference in their local communities through their businesses.”

“It is heart-warming to learn that Purolator is again stepping up to support local businesses,” says Opal Rowe, Owner of Stush Patties and a 2021 Purolator True North Small Business Grant Contest recipient. “I’m overjoyed the grant is being taken to a new level this year with a new ‘pay-it-forward’ component. Since winning the grant, I have been able to scale up my business and give back to a local non-profit organization that supports women entrepreneurs.”

Small business fast facts

As of 2019, there were 1.2 million small businesses in Canada, employing 8.4 million individuals or 68.8 percent of the total private labour force. (Source: Innovation, Science and Economic Development Canada Small Business Branch, 2020) Only 35 percent of small businesses have returned to pre-pandemic sales levels, while debt levels and the share of businesses considering bankruptcy remain high.

(Source: Canadian Federation of Independent Businesses, 2022) Nearly two-thirds of businesses affected by labour shortages said they cannot find job applicants with the right skill set or experience, while 52 percent reported a lack of any candidates at all. (Source: Canadian Federation of Independent Businesses, 2021) Purolator Inc. is a leading integrated freight, package and logistics solutions provider.

Celebrating over 60 years of delivering its customers’ promises, Purolator continues to expand its reach and renowned service levels and reliability to more people, more businesses and more places across the country and around the world. Purolator is proud of its Canadian heritage and is focused on sustainably positioning itself for future growth and success. Purolator is also committed to contributing to the well-being of the communities it serves and where more than 14,000 of its employees live, work and play.

APRIL 2022

// 7 AMA Marketing News The American Marketing Association Toronto Chapter (AMA Toronto) is a not-for-profit organization focused on advancing the practice of marketing and the success of marketers within Canada. Since 1946, AMA Toronto has been committed to helping individuals and companies within the Toronto and Canadian business community connect, learn, and grow.

A welcoming community run and led by volunteer marketers, AMA Toronto is an inspiring and empowering organization committed to building the marketing leaders of tomorrow. Our goal is to help transform individual marketers into successful business leaders who can succeed on both a local and global stage. Only AMA Toronto provides a gateway to Canadian and international opportunities that empower your leadership potential at every stage of your career. www.ama-toronto.com

APRIL 2022

Legends Among Us:

Canada’s Marketing Hall of Legends names 2022 winners

BY ROBERT MACLEAN

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MA Toronto’s Canada’s Marketing Hall of Legends (CMHOL) announced its 2022 inductees — and we can relish the place that data-driven, response-based marketing has in this hallowed gallery.

Our newest Marketing Legends are Chris Lang, former chairman, Lang Partnerships Network; Zak Mroueh, founder and chief creative officer, Zulu Alpha Kilo; Brenda Pritchard, partner, Gowling WLG; Dani Reiss, president and CEO, Canada Goose Inc.; and Edie Weiss, president and CEO, Radke Film Group. The 2022 Marketer-on-the-Rise is Marie Chevrier Schwartz, founder and CEO of Sampler.

“Each of these diverse Canadians has elevated our industry in Canada and on the international stage and are being recognized for their remarkable leadership achievements,” says Tina Portillo, president of AMA Toronto.

The longest-running industry program of its kind, Canada’s Marketing Hall of Legends, honours the industry’s most inspiring visionaries, enablers, builders and mentors who’ve had tremendous impact on the field of marketing throughout their careers. The Marketer-onthe-Rise award celebrates Canada’s top up-and-comers.

“Our 2022 Canadian Marketing Legends epitomize successful business leaders pursuing excellence in the field of marketing. They all have demonstrated that in their careers business decisions have been based on analytics and key performance metrics to align achievements to overall business objectives,” says Nancy Marcus, chair of this year’s CMHOL selection committee and a 2020 inductee for her leadership and accomplishments as chief marketing officer at Kruger Products.

“Data-driven intelligence has provided these five successful inductees the confidence and capabilities to generate insights to optimize decision making, support customer engagement and, ultimately, organizational success.”

For instance, the acclaimed leader of Canada Goose, Dani Reiss has transformed the small outerwear manufacturer founded by his grandfather into a global performance luxury lifestyle brand. He is recognized for playing a central role transitioning the business into an iconic consumer-facing brand, developing international markets and championing made-inCanada manufacturing. His company’s corporate social responsibility and omni-channel marketing and sales model is what Legends are made of.

Brenda Prichard is the first advertising and marketing lawyer to be honoured by Canada’s Marketing Hall of Legends. Brenda has been a law partner at Gowling WLG for more than 35 years and knows what it takes to produce cutting-edge advertising that is both legally compliant and protects the creative idea. With experience across nearly every platform and product/service category, she is a trusted adviser to dozens of the world’s top brands and creative agencies on laws and guidelines applicable to data and privacy, eCommerce, marketing

technology (MarTech), and all facets of marketing.

Zak Mroueh’s record of creativity and innovation in marketing spans 35 years as a writer, creative director, philanthropist, and entrepreneur. He presently leads one of Canada’s foremost creative agency networks. His self-described “maverick indie agency” Zulu Alpha Kilo has been well recognized at home and abroad for creating award-winning work for brands like Bell, Cineplex, Interac, Harley-Davidson, HomeEquity Bank, Harry Rosen, and Subaru. Zak’s unconventional approach to business and use of multiple media channels to implement programs, track response, analyze results, measure ROI and generate sales for his clients is undeniably legendary.

Edie Weiss is our first Legend from the commercial film production industry. She founded the Radke Film Group in 1992 and has grown it into one of the pre-eminent production companies in the world. In an era of digital transformation, Edie produces award-winning advertising content for a long list of top clients. Giving back has always been a hallmark of past legends, and Edie famously created POV, an organization that creates opportunities for diverse young people to have careers in TV, film or advertising production. While empathy, collaboration, partnership and empowerment are her raison d’être, Edie says simply: “Doing good is good business.”

Chris Lang, “the Guru of Canadian partnership marketing,” is being honoured posthumously for his vision and progressive leadership. Chris spent five decades leading sponsorship development and innovation at Lang Partnerships Network and was committed to delivering game-changing partnerships in sports, entertainment, transportation, and other sectors that matter to society.

From major multi-national corporations to Canada’s leading companies — the roster of organizations that benefited from his insight and marketing expertise is a testament to his stature. We remember and celebrate Chris as a Legend, a Canadian visionary who created deep, immersive consumer experiences.

Marketer-on-the-Rise Marie Chevrier Schwartz’s company Sampler, launched in 2013, is a leading technology platform for product sampling. Sampler delivers data-driven product experiences that create personalized relationships between people and brands.

Marie started Sampler with a vision to transform the way consumer packaged goods companies distribute product samples. Today, Sampler's network reaches over 50-million consumers in 24 countries and serves some of the world’s largest brands like L’Oréal and Unilever.

Learn more about how data-driven response-based marketing has driven the accomplishments of our Marketing Legends in future DM Magazine issues, at the upcoming in-person CMHOL gala on May 12, and in AMA Toronto’s upcoming Legendary Leadership Series of events.

ROBERT MACLEAN is principal, MacLean PR & Corporate Communications, and vice president, public relations, AMA Toronto (www.ama-toronto.com).

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MARKETING INSIGHTS

The Only Number That Matters

BY STEPHEN SHAW

Proving the value of marketing means showing that the investment is paying off in faster business growth.

But that is only possible if marketing adopts a more unified approach to measurement.

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t is the one number a CMO needs to know. The one number that truly matters. The one number that will appease the CEO. Most CMOs wilt under budget interrogation by their boss.

Because all CEOs ever really want to know is, “How much did you contribute to the growth of the business?”. Since CMOs never have actual hard proof to share, they throw up a smokescreen of soft metrics that have no obvious bearing on the health of the business. The invariable response: “So what?”

No wonder CEOs lack faith in the financial literacy of marketers. They are exasperated at marketing’s perpetual failure to quantify the business impact of their spending. CEOs are judged on the corporate earnings trajectory — on whether they’re making their quarterly numbers — and on the stock price. And so, the only number a CEO cares to hear is the incremental growth rate attributable to marketing. The rest is mumbo jumbo.

Marketing is handed a slice of the operating budget to lead the charge on revenue growth: to help the business grow faster than it might otherwise — faster than competitors, faster than business analysts are projecting, and certainly faster than shareholders expect. The CEO needs the reassurance of knowing that money is being invested wisely — that it is building growth momentum — that it is generating a payback — if not next quarter, when? Is marketing driving sales that are truly above baseline? Do the profits on those sales exceed the fixed and variable marketing costs? Is the budget as lean as it can be?

That’s where the numbers get speculative.

Incrementality is hard to prove.

Today’s meandering path to purchase makes it tough to trace a direct line between marketing expenditures and top-line sales,

never mind knowing the ratio of customers who would likely have bought anyway. It takes disciplined experimental design to figure out.

Even trickier is connecting the dots between brand value and enterprise value. And while there are plenty of brand tracking studies and academic research models showing how much a strong brand is worth, the corporate finance world buries that calculation under the label of “goodwill” along with other intangible assets like patents and trademarks.

In trying to win greater C-level credibility, marketers are faced with twin hurdles: the difficulty of converting intangible performance measures into hard financial numbers that are accepted as valid entries on the balance sheet; and a cultural discomfort with the language of business which is finance. Their mortal enemy remains the CFO who takes pleasure in the look of anxiety on their face at budget time.

That is why marketing is still viewed as a cost centre. It is why CMOs are easy scapegoats when the business fails to hit its financial goals (“Grow or Go”, they’re told). That is why most CMOs are still not welcome in the boardroom where marketing is an afterthought. And it why they are almost never asked to help develop the corporate growth strategy, just be answerable to it.

Yet marketers have more ways than ever to measure success, so why so little success at measurement? Mainly, because the evidence is hard to gather.

The proof points are scattered across various marketing, CRM, eCommerce, and business reporting systems, as well as external syndicated databases.

And marketers tend to operate in channel and product silos, squabbling over budget dollars, claiming their metrics matter the most. There is no shared stake in mutual success, nor even a collective understanding of what it means — each team favouring its own narrow interpretation.

Before marketers can showcase their contribution to business growth, they need to build a more unified measurement system — one that makes it easier to make APRIL 2022

MARKETING INSIGHTS the connection between brand building efforts and revenue — between relationship marketing and repeat purchase — between the total marketing investment and the one number that really counts: the growth velocity of the business. [Figure 1]

influence on people–but whether or not they lead to stronger purchase intent remains a leap of faith.

Another trap is relying strictly on what customers have done in the past to predict the future.

Revenue projections are usually based on an extrapolation of

Figure 1 A unified measurement strategy should revolve around the marketing questions that matter the most.

A Marketing Metrics System Any metric worth tracking is being captured and stored today on a system of some kind. The challenge is to fit those metrics into a united and cohesive framework where the interdependencies become more obvious. “Marketing managers need measures to assess the health of their brands and to judge the effects of their marketing campaigns. Sales revenue and contribution to profit … aren’t enough”, notes Bryon Sharp, the Professor of Marketing Science at the Ehrenberg-Bass Institute, best known for his muckraking book How Brands Grow1. “A thorough metrics system includes financial metrics, buyer behaviour metrics, memory metrics, customer profile metrics and marketing activity metrics.”

purchase trends while accounting for exceptional market events (say, a new product introduction) and exogenous factors (such as the state of the economy). But there are certain lead indicators that should be considered as well, such as people’s perception of the brand. Otherwise, marketers can be caught by surprise when sales plummet due to a precipitous decline in brand affinity (Kraft Heinz is a notorious case in point, forced to swallow a $15 billion write-down in 2019 on its most famous brands due to marketing cost-cutting that badly eroded their market value).

Using both attitudinal and behavioural metrics as parameters, marketers need to be able to estimate the potential lift in short and long-term brand sales based

With the glut of response and clickstream data available, it is easy for marketers to fall into the trap of obsessing over activity metrics.

With a glut of response and clickstream data available, it is easy for marketers to fall into the trap of obsessing over activity metrics.

Knowing the number of brand followers and social media “likes” can be comforting — it proves that marketing tactics are having some APRIL 2022

on different investment scenarios.

To drive immediate revenue growth, for example, it may be smarter to free up some of the budget dedicated to brand image advertising in favour of doting on high value customers already predisposed to buy.

// 9 Marketers need an investment different levels of the hierarchy? mindset to make those choices Marketers need to determine how movement at one level — not based on the immediate gratification of a spike in ad corresponds with another; which impressions and clickthroughs metrics are tightly associated; and the statistical strength of — but by positively affecting downstream measures of success those dependencies. As McKinsey like repeat purchase rate, average Consulting observes3, “Only when marketers have linked KPIs can order value, and customer they identify the interactions most retention. Although few CMOs tightly tied to business value and keep their jobs for long by looking start making smart decisions to too far out into the future — the adjust or rebalance their marketing next quarterly earnings report spend”. [Figure 2] is about as far as many dare to go — there is little to be gained by stoking short-term Figure 2 promotional sales To prove its contribution to business success, at the expense of sustainable long-term marketing needs a unified measurement growth. Yet marketers system that links the chain of performance metrics to financial goals and outcomes. are constantly under pressure to cannibalize future sales through aggressive discounting which only trains shoppers to stock up when sales events are held.

The first step must be to reach agreement on a marketing measurement model that shows the full chain of marketing effects. Gartner Research’s advice2: “Let go of activity-basedonly metrics, like clickthrough rate or traffic, and embrace metrics that link marketing performance to business outcomes.”

At the top of the measurement Brand Health hierarchy are the stepping stones The traditional role of marketing of revenue growth — such as is to serve as the brand steward, market share, category penetration responsible for growing brand and share of expenditures — equity through market positioning which everyone recognizes as vital and messaging. But the concept to success. The secondary tier is of brand equity is an abstraction made up of the underlying brand lost on most CEOs. Defined as and customer health measures that the perceived value of the brand best explain market performance. by the target market, it only ever Laddering up to those higher order gets acknowledged if a business tiers are the operational layers is acquired, when it gets baked that show the impact of marketing into the purchase price. Other investments, whether that is than that, brand equity goes customer engagement across unrecognized as a business asset. touchpoints (e.g., web, mobile, And so, any proposed expenditures email, social); program results to build brand equity are viewed (e.g., brand building, demand sceptically by corporate finance generation, lifecycle management); as a dubious investment since the and media effectiveness (e.g., asset value is fixed. online versus offline).

Brand equity may be dismissed What is really critical to know by finance as a made-up marketing are the interdependencies between measure, but a healthy brand is DMN.CA ❰

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MARKETING INSIGHTS certainly worth a fortune (in 2021, Coca-Cola’s brand was valued at a whopping US$88 billion). If people strongly prefer the brand over the competition it will command a price premium because they are willing to pay more for it (Apple is the classic example — but it applies to any brand where price is not a primary choice determinant).

People will go out of their way to buy it. They will be resistant to switching offers. They will be more open to expanding their relationship with that brand by buying more of what it has to offer.

And they will be more inclined to recommend the brand to family and friends. None of that should be up for debate — yet finance

can be derived and tracked against revenue growth.

Even with a precise understanding of the link between brand health and market metrics, it can still be difficult to attach a hard number to brand value on the balance sheet. Neil Bendle, Chairman of the Marketing Accountability Standards Board (MASB), says, “Financial statements cannot fairly represent the value of the enterprise if they don’t systematically include key intangibles like the brand and customer relationships. Brand valuation has been a hodgepodge of rules inconsistently applied and reported.”4 According to MASB, brand value contributes almost

Brand equity may be dismissed by finance as a made-up marketing measure, but a strong and healthy brand is certainly worth a fortune brushes all of that off as too subjective.

For a brand to reach that coveted status it has to earn it.

That means people have to be aware the brand exists — it has to be top-of-mind when they are ready to buy — it has to be seen as distinctive — it has to be admired for the experience it offers — and today, increasingly, it has to strike an emotional chord with its fans who will enthusiastically serve as advocates. Emotion is a tiebreaker.

Feelings matter much more in decision making than we like to believe. A Tesla buyer feels pride of ownership — a Sephora member feels pampered — a Disney visitor feels joy — an Apple buyer feels superior. What a brand needs to avoid is being stuck in purgatory where customers feel nothing.

What needs to be proven is the correlation between those feelings and sales. If the determinants of brand health can be isolated and weighted according to their relative contribution (say, the importance of brand salience versus brand loyalty), they can be compared to market metrics. From that analysis a composite brand health score ❱ DMN.CA

20 percent of enterprise value on average, even more for consumer brands. The onus is on marketing to come up with a way to prove the asset value of the brand using a sanctioned formula that reflects its current market strength and growth potential.

MASB has come up with what it declares to be a mathematically sound way to valuate a brand for investors. Its approach is to estimate the present value of future cash flow attributable to the brand based on a number of variables, including the size, growth rate and maturity of the category it competes in; the current level of consumer brand preference; the degree of price sensitivity; and its availability through distribution channels. A cash flow estimate is calculated for a defined time horizon (based on the expected life of the brand) and then a discount rate is applied to come up with a present value.

Customer Health If that formula seems vaguely familiar, it is because much the same method is used to calculate customer equity, a term even more

incomprehensible to a CEO, despite the fact it has been part of the marketing lexicon for more than a quarter century, longer if you go back to a time when continuity publishing and mail order cataloguing were flourishing5.

Based on the belief that a customer should be treated as an asset, it is calculated by estimating the total future net profit that can be expected over the average lifetime of a customer relationship.

Customer equity is therefore the sum of the estimated future net value of all customers (even though the strict definition of equity requires liabilities to be subtracted).

The concept of customer equity has always been widely promoted as an economic justification for relationship marketing (Peppers and Rogers called it “Return on Customer”6): customers are bound to increase in value over time, the argument goes, provided they are treated with respect. Yet the concept has never gained much traction in corporate finance despite the irrefutable logic: the greater the number of happy customers, the more successful a business will be in the long run. But financial accountants are oblivious to the number of customers and could care less how

argues should be a key part of the equation. He calls it “earned growth rate”: the revenue growth generated by existing customers and the referrals they bring in.

Naturally, a business cannot simply rely on organic growth to sustain itself — after all, some attrition is unavoidable. Lost customers need to be replaced.

And marketing is always faced with stretch growth targets, when they must win over a greater share of new market entrants; capitalize on emerging market opportunities; and crack open promising adjacent markets. This is where customer lifetime value can be helpful: guiding the level of investment in new growth by setting a ceiling on acquisition spending. And marketing can use what it knows about customer profitability to identify the ideal market segments to go after. A rule of thumb is to set the allowable acquisition cost at a ratio to LTV of 3:1. That is, the cost should be fully recoverable within three years.

The main gauge of customer health is certainly loyalty.

But loyalty is not necessarily synonymous with behavioural metrics like customer retention and repeat purchase rate.

Customers may stick with a brand for many reasons —

Knowing what causes disloyalty can be just as important as knowing what keeps customers loyal. happy they are or what they may be worth in future.

Unless a business is a pure start-up, the next sale is likely to come from a current customer.

And the more loyal customers are to the brand, the more likely they are to buy additional products and services. That is why the Pareto principle is true of most businesses: a small minority of loyal heavy spenders usually account for a disproportionate share of profits and are usually five times more valuable than an average customer. Those are also the customers willing to refer the brand to other people, a calculation that Bain’s Fred Reichheld

passivity, habitual buying, lack of alternatives, or simply convenience. Often, they feel totally ambivalent toward a brand and have no qualms about switching because they view the choices as completely substitutable (think telcos, grocers, banks, insurers).

A truly loyal customer is one who believes the brand is an integral part of their life: they could not live without it — they would go out of their way to buy it — they would never consider switching — they would mourn its demise. Highly loyal customers only ever defect if they’re driven away by extreme negligence. Knowing what causes APRIL 2022

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MARKETING INSIGHTS disloyalty can be just as important as knowing what keeps customers loyal.

The most widely used loyalty measurement equation today is certainly the Net Promoter System which appears on the enterprise dashboard of most top firms as a benchmark measure. The NPS score represents the ratio of “net promoters” willing to recommend the brand. It is used as both a barometer of how customers feel about the brand relationship, as well as how they rate specific sales and service “moments of truth”.

There is risk in relying on NPS as the sole loyalty metric — after all, people may recommend a brand even if they are one-time users — and some view it as much too simplistic, preferring to augment it with a medley of diagnostic metrics.

For example, knowing whether a customer intends to buy again — or is likely to try competitive products — or perceives the buyer journey to be worth the trouble — can reveal the true depth of commitment to the brand.

Drawing an accurate picture of the health of the customer portfolio means tracking both the behavioural indicators–like purchase frequency, average annual spending, and “share of wallet” — and emotional drivers such as brand relatability, trustworthiness, and empathy (the perception that a brand actually cares enough to put customers first). [Figure 3]

The surest path to business growth is to make the brand an integral part of as many people’s lives as possible, delivering value at every stage of the customer lifecycle The surest path to business growth is to make the brand an integral part of as many people’s lives as possible, delivering value at every stage of the customer lifecycle, from the time they first encounter the brand to continuous engagement as the relationship progresses. Marketers must be able to track movement through each stage of the lifecycle using progression metrics, such as the lead-to-sale conversion ratio; the average interval between purchases; the spend level and activity of customers by time period; the year-over-year change in average annual spending based on tenure; just to cite a few common ways.

Making smart investment decisions demands a funding formula that equitably supports both acquisition activity (like advertising and lead generation) and loyalty building. Here again the LTV calculation comes in

Figure 3 Marketers need to understand the interdependency between value measures and the underlying attitudinal drivers of brand and customer health.

Program Measurement If loyalty is the principal fulcrum used by marketing to drive growth in customer value, the question is what will it take to move customers up the loyalty ladder? To get them to spend more and more often. To love the brand. To become brand advocates.

APRIL 2022

handy. What is the residual CLV value of all current customers?

How much can we expect them to contribute to profit during the current earnings period?

The next fiscal year? What is the cost of attrition expressed in lost opportunity? What is the replacement cost? How much room

for deeper category penetration is there? Is the cost of converting competitive brand users worth it?

Another major role of marketing is keeping customers continuously engaged as the relationship matures. The strongest sign of a healthy relationship is the reciprocal exchange of information.

As the relationship grows stronger, a customer becomes more confident in sharing details about their personal interests and needs, trusting the information will be put to good use. So, a key indicator of success is not just the size and addressability of the consenting audience, who have proactively agreed to stay connected and involved in some way, but the willingness of customers to provide personal data and feedback that can improve their experience.

A blended engagement score can capture that customer dynamic.

[Figure 4]

offer” recommendations — and reward the best customers with special treatment and entitlements. To know if those investments are paying off, marketers need a wide range of success metrics that show whether they are achieving their tactical objectives.

Each marketing program will have its own set of key performance indicators. A program designed to educate and inform customers on brand-related topics is evaluated according to content marketing metrics. A loyalty program is focused on optimizing membership metrics like enrolments, activations, point accruals, redemptions, and “lift and shift” in member spending.

A voice of customer program is seeking to maximize survey and polling responses while building as participative a brand community as possible. A social media program is interested in attracting a large audience of engaged followers to maximize social sharing. And a demand generation program is of course tracking the full range of performance metrics, from digital ad impressions to video viewership to landing page visits to trial signups to sales conversions.

Marketers must also consider the efficacy of different media channels. How much of the engagement traffic is flowing through the corporate website?

Figure 4 The components of an engagement score should include measures of both proactive contact and the consensual exchange of personal information.

Today most marketing programs are designed to drive engagement.

These programs need to build brand awareness — encourage discovery and exploration of the brand — support post-sales interactions — make “next best

The content hub? Satellite sites?

The mobile app? Social channels?

What is the halo effect of offline media? This is the efficiency question — perhaps the toughest one to answer, simply because people are using multiple channels DMN.CA ❰

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MARKETING INSIGHTS

and devices, often simultaneously.

What is the impact of an outdoor billboard ad or a TV commercial or a print ad? Digital metrics like surges in web traffic and app downloads — in search engine results — in the clickthrough rate — offers some clues. But channel optimisation really demands more advanced analysis like market mix modeling and multi-touch attribution methods, using commercial tools and media tracking services.

Unified Measurement All of these disparate measures — from attitudinal to behavioural, from survey-based to transactional, from raw numbers to derived calculations, from aggregated counts to derived scores — need to be corralled and herded into a unified measurement system where they can be tracked, visualized, and explored.

A multi-dimensional dashboard should serve as an “at a glance”

portal to the marketing metrics system, featuring the capability to track metrics versus goals; compare multiple time periods; highlight deviations from plan; trigger exception alerts; support drill-downs to underlying segments, cohorts, products, and regions; and conduct “what if” simulation planning [Figure 5]. It should also be possible to visualize the sales history with yearly trend lines that can be mapped back to the timing and amount of different program expenditures. With enough history, the evidence will begin to mount showing exactly how those investments are paying off in annual business growth.

With the entire universe of marketing measures in one central repository, strategic insights can be gleaned through econometric analysis, determining the correlative strength between a dependent variable (such as sales volume) and multiple independent variables (like brand

Figure 6 The central measurement challenge is to prove that marketing is making an incremental contribution to growth momentum.

and customer health scores). The influence of each variable can be quantified and used to rank the business impact of the different performance drivers. The value of a one-point increase in loyalty or brand preference can be calculated and used to figure out the level of effort and expense required to achieve it.

Eventually a direct line can be drawn showing the full chain of effects — from marketing investments to market metrics to

Figure 5 A Marketing Dashboard can serve as a unified repository of key metrics offering an “at a glance” view in the form of infographics.

Source: Ignite Tech.

business results to financial payoff.

Ideally, the unified measurement system will lay the groundwork for concluding whether the overall investment in marketing — the total marketing budget — is appropriate based on a thorough bottom-up ROI analysis, proving that for this amount of money, the business can expect this rate of growth. [Figure 6] Today most marketing budgets are a fixed expense, typically about 11 percent of the overall budget, and regularly subjected to quarterly trimming depending on how sales are performing against target. The size of that budget is often dictated by what was spent the previous fiscal period and approval above that figure always requires some fancy tap dancing in front of the CFO. To escape this financial straight jacket, marketers need to convincingly link corporate growth ambitions to the mandatory investments required to achieve them. In the end, that means emphatically answering the most burning question on the mind of the CEO: Is marketing worth the expense?

STEPHEN SHAW is the chief strategy officer of Kenna, a marketing solutions provider specializing in delivering more unified customer experiences. Stephen can be reached via email at sshaw@kenna.ca 1. Bryon Sharp’s main thesis is that brands can only grow by reaching everyone in the target market, even the ultra-light buyers in a category. He also argues that loyalty ladders are “misleading and unhelpful”.

2. McKinsey & Company, “Why Every Business Needs a Full-Funnel Marketing Strategy” (February 2021) 3. Gartner Research, “How to Prove the Value of Marketing to the Enterprise” (December 2019) 4. “Proving the Value of a Brand”, MASB/Forbes (2019) 5. Most of the early credit goes to Robert C. Blattberg and John Deighton who published a popular article in Harvard Business Review called “Manage Marketing by the Customer Equity Test” (1996).

6. “Return on Customer”, Don Peppers and Martha Rogers (2005).

❱ DMN.CA

APRIL 2022

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ISTOCK/ TARIKVISION

DIRECT MAIL

THE MAILBOX AS THE NEW MALL

How Creative Marketers Use Direct Mail Today

BY MICHAEL BROOKE

E

verything old can become new again — take vinyl for example. But sometimes even marketers can be taken by surprise. The evolution of direct mail might seem to have left it a niche medium yet the reality of how mail is being implemented today is very different from the perception.

While digital marketing has grabbed the spotlight over the past decade, direct mail continues to garner a renewed cachet and there is no doubt its influence is growing. Evidence is all around us that direct mail is a tremendously adaptable channel that continues to drive results for those who know how to leverage its capabilities. Those marketers are doing this in ways that are sometimes ingeniously creative and truly engage customers and prospects from all demographics.

APRIL 2022

It’s also delivering some pretty astounding results.

It’s no secret that many major fundraisers never left direct mail as a primary marketing channel.

One non-profit that demonstrates how scientifically-backed direct mail can be a game-changing fundraising strategy is Toronto’s Scott Mission. This Christian based organization turned 80 years old in 2021 and as Holly Thompson, their director of marketing and communications explained, “Prior to 2008, the Mission didn’t do much active fundraising. We had a few newsletters each year. We had about 5,000 donors and it generated about two million in donations.”

Unfortunately, this was nowhere near their operating budget and they relied on a handful of key donors to make up the shortfall.

“We knew that we had to do something — we couldn’t just

rely on God for support.” So, they made the decision to invest heavily in donor acquisition strategy through tactics which included outside list rentals, which were heavily leveraged to actively solicit targeted members of the public via direct mail. It was a move which paid off with dreamlike results.

“Over the past 14 years, we have grown to more than 65,000 donors who provide us with more than $16 million in donations.”

Thompson also points to the fact that data-driven tactics which include segmentation and analytics help identify high-value or high-potential donors, who are then also cultivated by direct mail methods to support even more.

“We have had donors move from $500 per year to donating tens of thousands the following year.”

It’s the kind of story that is played out all across fundraising programs in Canada, but there

are many more retail and other vertical marketers delving deeper into direct mail than was thought possible just a few years ago. It is a trend which can be said to parallel the role vinyl has taken as a musical medium which delivers powerful results for the listener.

And that’s not the only way old becomes new again.

Typewriters cool again In September 2021, The AARP published a story with the headline 11 Ways Typewriters Are Cool Again. The bi-line read “spurring creativity and attracting younger fans, their popularity is on the rise.

In March of 2022, the Wall Street Journal published a story with the title Why Millennials Want Their Parents’ Vinyl Records. A telling part of the piece came from a quote from Jim Henderson, co-owner CONTINUED ON page 16 DMN.CA ❰

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DIRECT MAIL CONTINUED FROM page 13

of Amoeba Music — Los Angeles largest record store. “Vinyl is an audio, visual and feel format. In my conversations with younger customers, vinyl has a similar emotional appeal as candy might have; especially picture discs and albums with colour vinyl.”

Dave Vander Ploeg, Executive vice president of franchise and business development at DRMG was pretty dramatic in his assessment as to where things are right now: “With people moving to places like Amazon to shop, the demand for cardboard boxes has skyrocketed. All of the paper mills are at 99 percent capacity and direct mail is booming.”

Vander Ploeg says that a few years ago, people used to dread going to their mailbox in January and February. “Now that bills are electronic, the mailbox has become the new mall. Direct mail engages a customer and is a non-intrusive way to reach a prospect.” As he explained, people go out of their way to avoid advertising — whether through things like streaming services or ad blockers.

“But direct mail is an honest medium that puts the decision to react to a specific offer in the customers hands. “If you don’t like it, you can place it in the recycling bin and move on.”

When it comes to the issue of attention, most people who work in marketing will point to the fact that goldfish now have a longer attention span than humans (less than 9 seconds). Despite this feeling like solid science, it is indeed a myth and not based on the actual evidence. The reality is that goldfish actually don’t have short attention spans, according to Professor Felicity Huntingford of the University of Glasgow.

Professor Huntingford has spent almost half a century studying fish behaviour and has stated that goldfish are “a model system for studying the process of memory formation, exactly because they have a memory.” It turns out “that goldfish can perform all the kinds of learning that have been described for mammals and birds.” There are hundreds of studies on goldfish learning and nothing indicates they have a short attention span. ❱ DMN.CA

For those marketers who grew up in the ‘70s, ‘80s and ‘90s, the mailbox used to be cluttered with dozens of pieces of direct mail each week. As digital took over and jammed people’s inboxes, the amount of direct mail decreased.

This empty space is now being reclaimed by savvy marketers who face much less competition for people’s attention.

DRMG’s Vander Ploeg says that a few decades ago, having a digital presence meant you had deep pockets and resources. It meant credibility. “Nowadays, for just a few dollars, anyone can get a website going. Things have flip-flopped. Having a direct mail campaign actually establishes your credibility as a marketer.”

Print’s not dead After speaking with a number of direct mail experts, the one particular theme that kept coming up was “enhancement.” The fact is that direct mail is not going to replace digital marketing, but it really works well alongside it.

When it comes to measuring the ROI, direct mail can be tracked by things like QR codes, call tracking and coupon redemption. If you’re wondering about the power of direct mail, take a look at this statistic: when direct mail is used in combination with a digital, results can be over 250 percent greater or more than when using digital alone. Now that I’ve got your attention, it’s time to explore the power of direct mail.

As David O'Connell, founder of BANG! Creative so eloquently put it, “Print’s not dead, it has shifted.”

And what a shift it has made.

O’Connell pointed to the fact that in the past, print was incredibly expensive and was rather limiting for most small businesses. “There was also the issue of waste,” says O’Connell. “But digital has allowed us to become strategic when it comes to the use of print.” The agency hones in on the collection of the data and leverages this to everyone’s advantage. O’Connell explained that in one particular direct mail piece, the company targeted a specific group of people who received beautifully printed customized brochure along with a keychain and pen. “We knew from the data that these were receptive people and that the marketing

message would be received in a positive way.”

“At its core, direct mail is about three specific things' ' explains Kristi Tomasin, director of the SmartMail Marketing program at Canada Post. “It’s about physicality — the power of the brand. It’s about utilizing data with surgical precision - the right channel and precise message. Finally, direct mail is about connectivity — it really works well with other media.”

Direct mail is truly something different in what can feel like a tsunami of digital messaging.

Many people are just overwhelmed by the amount of promotional emails they get. They are bombarded constantly by messages and calls to “like”, “subscribe” or “follow.” It is the physical, tactile nature of a printed piece carefully constructed to reach a specific customer or prospect that can really differentiate your business from the competition.

Direct mail fits budgets The unique thing about direct mail is that it can fit a wide variety of budgets. Should you wish, highly creative, customized pieces can be sent out to a selective few — like Instagram or TiK Tok influencers.

If you’d prefer to reach a wide audience for low cost, you can share the costs with other advertisers.

While it may seem counterintuitive, Amazon, the world’s largest online retailer, sends out millions of printed catalogues.

They see direct mail as a way to engage customers and a way to draw consumers towards inspirational brand messages.

Adding to the “isn’t it ironic file”, you might be surprised to learn that Google is another digital giant that invests heavily in direct mail.

In fact, if you Google “why does Google use direct mail?” you will encounter hundreds of articles explaining why the company invests millions in direct mail.

Tomasin points to the tactile experience a consumer will be given through direct mail as one of its key benefits. “It is immersive and it can be a unique part of the customer journey. When it comes to specific companies or organizations, people do in fact want them to know them.”

Over the past two years, a number of consulting companies

have looked at the impact of COVID as it relates to the home.

Olive Wright, managing director of consulting firm Accenture was quoted as saying that “home is now the new frontier — it’s become the workplace, the schoolroom, the place to try new hobbies, the place to socialize and a safe sanctuary — so companies must account for this reality.” As Todd Cober, president of Cober Solutions explains, over the past two years, Canadians have spent a great deal of time cooped up.

“It’s changed what we value. The pandemic allowed us to open our eyes, to slow down a little bit and explore what really matters.”

Direct mail enters our home in a vastly different way than digital media does or in the way radio or TV does. When you think about how we engage with physical mail, you begin to examine what experts call “the mail ritual.” Think about the times you visit your mailbox.

You’ll carefully look for important mail - things like bills but a printed piece that piques your curiosity will most likely get some attention as well. “If it makes it into the house, then it’s a big win” says Cober.

Diana Lucaci, co-founder of True-Impact has done a tremendous amount of research on how people respond to advertising. I wondered about millennials and their reception to direct mail. “From various consumer neuroscience studies, we’ve learned that millennials respond ‘better’ to direct mail that involves a physical interaction, such as opening an envelope, ripping open a tab, etc” says Diana.

“The response is defined by the ratio between Motivation and Cognitive Load. We’ve learned that millennials find interactive direct mail pieces more motivating and easier to understand.”

True-Impact has also learned that millennials’ brains reacted well to the addition of the sense of scent. Slightly scented DM pieces scored well with this demographic, as well as with Generation X. Direct mail psychology A few years ago, Canada Post wanted to dive deeper into the psychology behind direct mail.

They examined how people actually interacted with mail. So they hired a team of ethnographic APRIL 2022

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DIRECT MAIL

Over the last two years, the restrictions of the pandemic meant that marketers had to get creative. One particularly unique campaign was for Absolut Vodka. Each during the holiday season, Absolut creates a special edition that is eagerly snapped up by collectors and fans.

Prior to COVID, Absolut Canada would do a multi-media campaign featuring in-store displays and point of sale elements. But the safety measures put in place in liquor stores for physical distancing meant that in-store displays were being significantly reduced.

Corby Spirit and Wine (the Canadian distributor of Absolut) felt that other marketing channels were somewhat clogged, so they decided to do a direct mail piece. They brought in a specialty direct mail company by the name of Marketing Kitchen. “The design was oversized with impactful and bright colours.

It featured a protective coating with a super luxurious feel and was truly unique” says Audrey Jamieson, president of Marketing Kitchen. “It definitely got people’s attention.”

A QR code enabled people to find the closest location for purchasing a bottle. 250,000 pieces were sent out to selective neighbourhoods and residents across Canada. The net result was impressive. Sales for the limited-edition bottle were record setting: 70 percent higher than the previous year.

APRIL 2022

researchers to observe people in an open, non-directed way. It was all about what type of behaviour was present when they retrieved the mail and why they were happening.

The researchers found that mail is so ingrained in people’s lives that consumers ritualize it. In the process, they imbue it with emotionally charged meaning, making them more susceptible to inspiration from brands.

At the beginning of the mail ritual, it was found that people engaged in what is called “a mail sort.” This generally takes between two to five minutes and tends to happen in the same part of the home each day.

The researchers noted that a mail ritual can be accompanied by a range of associated activities, including listening to music, making dinner, talking with family members or watching TV. In terms of priority and importance, it comes as no surprise that addressed mail is opened and read immediately, promotional mail is filtered for interest, and items that require a more detailed read are set aside for later.

When compared to digital, the study found that consumers are far more likely to notice, open, read

and enjoy mail than digital forms of advertising. They felt it was less intrusive, more memorable and the best way to make them feel valued.

They also found that consumers keep mail and display it in the homes and share it with friends and family.

By doing so, this creates multiple opportunities for a brand to be seen. They also found direct mail is persuasive in driving people to a store or to take action. The other critical piece about direct mail is that it doesn’t contain harmful viruses.

Most people trust their mail a lot more than their email.

True SCAN (part of True Impact) has tracked with eye tracking glasses how people’s attention flows with direct mail. “Our studies show attention going to the recipient's name first and foremost. In addition to ensuring the information is correct, seeing your name is very engaging for the brain. After all, your name is your favorite word” says Lucici.

A well designed piece of direct mail will guide attention to the brand's intended areas of interest: brand logo, promotion, call to action, etc.

To avoid wasting marketing dollars, it is important to ensure people will DMN.CA ❰

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DIRECT MAIL quickly understand the offer and not feel overwhelmed or confused.

What grabs people’s initial attention will determine what is then perceived as relevant, and ultimately read further.

“Ultimately, pieces that are persuasive, engaging, entertaining and interesting are then likely to be kept, displayed and shared with others. A bit of pre-planning and optimization will help guarantee the success of your direct mail piece. The main determining factor we’ve identified is keeping to one main CTA, followed by supportive CTAs,” says Lucici.

Lucici emphasizes if marketers are planning to track calls into a URL, emphasize the link and de-emphasize the phone number, address, etc. “Ultimately, it’s about how quickly the idea is understood and sometimes, the best way to know is with the help of an objective, 3rd party perspective.”

Powering analytics When it comes to analytics, direct mail can provide some truly exceptional insights. A pizza

franchise based in western Canada worked with DRMG to determine where all their orders were coming from. The analytics indicated that 80 percent of their orders were coming from a 2½ kilometer radius but they were sending out flyers to a 5 kilometer radius. “This meant 50 percent of their advertising was going to waste,” explains Vander Ploeg of DRMG. “We shrank their radius and doubled up on the campaign with multiple offers. This included solo and shared mailings.”

The result was the franchises were able to direct the flow of orders and keep in constant contact with their customers.

“Direct mail helps customers move from the anecdotal to the empirical,” says Vander Ploeg.

Over the last two years, the restrictions of the pandemic meant that marketers had to get creative. One particularly unique campaign was for Absolut Vodka. Each during the holiday season, Absolut creates a special edition that is eagerly snapped up by collectors and fans. Prior to COVID, Absolut Canada would do

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a multi-media campaign featuring in-store displays and point of sale elements. But the safety measures put in place in liquor stores for physical distancing meant that in-store displays were being significantly reduced.

Corby Spirit and Wine (the Canadian distributor of Absolut) felt that other marketing channels were somewhat clogged, so they decided to do a direct mail piece.

They brought in a specialty direct mail company by the name of Marketing Kitchen. “The design was oversized with impactful and bright colours. It featured a protective coating with a super luxurious feel and was truly unique” says Audrey Jamieson, president of Marketing Kitchen. “It definitely got people’s attention.”

A QR code enabled people to find the closest location for purchasing a bottle. 250,000 pieces were sent out to selective neighbourhoods and residents across Canada. The net result was impressive. Sales for the limited-edition bottle were record setting: 70 percent higher than the previous year.

Not-for-profit success While there are numerous success stories from the for-profit world and direct mail, there are just as many stories from the not-forprofit and charity worlds. Alexis Martis, Director of Leadership Giving, BC Cancer Foundation says that direct mail is an excellent way to engage their donors with rich storytelling and to share the latest in groundbreaking cancer research and enhancements to patient care at BC Cancer. “It’s also a great channel for testing different messaging, creativity, and ask amounts to better understand what most resonates with certain audiences.”

The Cancer Foundation works with Canada Post has been able to target specific demographics in their acquisition activities.” Martis was also keen to dispel two myths surrounding direct mail — that it is either expensive or a waste of donors’ money. “It’s actually an excellent investment with a really strong return. While emails are less expensive, 70-80 percent of them are never even opened!

On the other hand, it’s generally understood that up to 90 percent

of direct mail gets opened.

The Foundation also includes QR codes and URLs that point to dedicated landing pages for each of their campaigns. “This allows us to better track that cross-channel response. And we’ve seen the online response to direct mail double over the last couple of years” says Martis.

Marketing Kitchen worked very closely with Plan Canada to develop a highly personalized piece of direct mail that featured a customized QR code that took donors to their own personal web portal. “It was a really engaging piece with an old school vibe that stood out as one of the most creative campaigns we did in 2021” says Jamieson of Marketing Kitchen.

The power of direct mail hasn’t been lost; in fact, as so many marketers tell us, it has expanded and adapted to be both a primary medium for many purposes — fundraising being one of the most prominent. What’s more, the tactics, methods, principals and techniques which were created and refined in the world of direct mail have migrated to, or been borrow by, the most fundamental major marketers in all channels.

It’s the basis upon which Facebook was built — personalization, segmentation, content tied to interests, and calls to action which match consumer (or business) interests and needs.

Going back to one of the major direct mail users in Canada, let’s leave the last word for now to the Scott Mission’s Holly Thompson, who uses direct mail to raise funds that benefit those who take advantage of the Mission’s services. As the Mission builds their investment in direct mail programs for donor acquisition strategies, they are consistent in their approach but they continue to test and re-test their tactics, as all great direct mail marketers must.

“Our organization re-examined how it was raising money and we realized we had to change the way we operate,” says Thompson.

“Direct mail has made all the difference in the world.”

MICHAEL BROOKE is a Toronto-based freelance writer and is also principal of Time for My Story, a memoir writing and publishing service.

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RETAIL MARKETING

STEP 4 Retailers focus on omnichannel shopping standard STEP 3 Use AR shopping experience to boost conversions

STEP 9 Consumers expect fast, free, and on-time delivery

11 STEPS

STEP 2 Experiential retail grows in importance

STEP 7 Consumers continue to be increasingly conscious STEP 8 Customer loyalty is more important than ever

STEP 10 Building community, more important than personalization STEP 11 Continue to innovate the payment experience

STEP 1 Competition in physical retail

ISTOCK/ RIKKYAL

STEP 5 Showrooming popular among retailers

STEP 6 Reimagine the store staff role

11 Data-Backed Retail Trends to Help You Succeed in 2022 and Beyond

BY ALEXIS DAMEN

T

he pandemic forced the retail industry to quickly adapt in 2020, and these changes continued through 2021.

More brick-and-mortar businesses opened an online storefront, clickand-collect order fulfillment options gained popularity, and consumers grew to expect a completely connected (and convenient) experience, regardless of the sales channel they were using.

These retail trends are here to stay, but as vaccination rates increase and parts of the world are reopening, consumers are getting APRIL 2022

more comfortable with shopping in person again.

To succeed in the future of retail, you need to enhance your omnichannel strategy, offer memorable in-store experiences, and train store staff on emerging technology to ensure a consistent shopping experience across all channels, online and offline.

Here’s an overview of retail trends to help you succeed in 2022 and beyond.

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Retail Trends in 2022 ❯ Competition in physical retail will increase as digitally native

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brands expand into brick-andmortar Experiential retail continues to grow in importance Brands are using AR shopping experiences to boost conversions Retailers must focus on the new omnichannel shopping standard Showrooming is increasingly popular among retailers Retailers need to reimagine the store staff role to find and retain employees Consumers continue to be increasingly conscious Customer loyalty is more important than ever

❯

❯

❯

Consumers expect fast, free, and on-time delivery Building community is more important than personalization Retailers must continue to innovate the payment experience

Let’s look at these in detail.

STEP 1 - Competition in physical retail will increase as digitally native brands expand into brick-and-mortar Shoppers are ready to get back out there to fulfill their retail therapy cravings, and with historically high retail vacancy rates and shorter, DMN.CA ❰

// 20

RETAIL MARKETING less expensive, and more flexible lease terms, digitally native brands are more eager to test the world of physical retail. According to a commissioned Forrester Consulting study conducted on behalf of Shopify, 35 percent of brands surveyed expect rising digital customer acquisition costs to be a top challenge in the next year.

Whether it’s a pop-up shop, shopping event, or short-term commercial lease, testing physical retail is a great way to reach a growing segment of consumers who prefers to shop in person.

In the United States, 81 percent of Gen Z consumers prefer to shop and discover new products in store, and more than 50 percent use in-store browsing as a way to disconnect from the digital world.

Dipping your toes in physical retail is also a great way to see if opening a permanent brick-andmortar location is the right move for your business.

But a more crowded physical retail space means increased competition, and you’ll need to come up with strategies to succeed.

We’ll cover a few of them in this article, but we recommend reading our Future of Retail Report for an in depth overview. The massive changes that 2020 brought to the retail industry are here to stay.

And now that parts of the world are opening up, and consumers are craving opportunities to shop in person, they expect the buying experience to be consistent both online and off. Download this report to learn about the retail trends, insights, and advice you need to succeed in 2022.

STEP 2 - Experiential retail continues to grow in importance As competition in physical retail increases, experiential retail is a way for you to differentiate your store. Create unique and memorable in-store experiences by focusing on community, events, and your prospective and existing customers’ interests. This way, instead of only aiming to increase sales revenue, you’ll also deliver enjoyable experiences that build brand affinity.

Let’s say you sell sustainably made cookware. You could create a community-building opportunity and bring customers in-store ❱ DMN.CA

by hosting a mix-and-mingle experience with other businesses that create products for the same or a similar audience. For example, you could invite a chef, a tableware brand, a local farmer, and a brand that makes 100 percent natural sauces or seasoning to participate in the event.

All the brands involved can display their products, so while shoppers are experiencing how great they are, they can also make a purchase.

Depending on the POS system used at your store, you can review your customer profiles to get an overview of purchase history and interests that can help inform your strategy to create the in-store experiences your customers are looking for.

STEP 3 - Brands are using AR shopping experiences to boost conversions According to a commissioned Forrester Consulting study conducted on behalf of Shopify, over one-third of brands say in the next year they’ll invest in using augmented reality (AR) to help shoppers visualize how the products they sell fit into customers’ lives.

During the pandemic, shoppers began to shop online more, and some larger retailers like Sephora and Rebecca Minkoff used AR technology to connect their digital and physical storefronts.

But leveraging AR to improve the customer experience should be possible for all retailers, no matter the size. That’s why we created Shopify AR to help you create immersive shopping experiences.

And it works.

Interactions with products having AR content showed a 94 percent higher conversion rate than interactions with products having no AR. Level up your customer experience and make sure it’s consistent across channels with interactivity and digital immersion from augmented reality (AR), virtual reality, and 3D media.

STEP 4 - Retailers must focus on the new omnichannel shopping standard In the same way that digitally native brands are moving into physical retail to reach more

customers, brick-and-mortar stores also need to figure out how to make their online and offline channels work together to deliver a completely connected customer experience. That’s why many retailers are planning to increase their investment in digital channels to drive sales over the next 12 months. According to a commissioned Forrester Consulting study conducted on behalf of Shopify: ❯ 49 percent of retailers say they’ll spend more on their companyowned online store as well as social selling ❯ 46 percent of retailers say they’ll increase investment in their owned custom mobile app ❯ 44 percent of retailers say they’ll increase their investment in livestream selling ❯ Investing in tools and technology to unify all your sales channels is vital to stay competitive.

This includes technology to help you: Offer more order fulfillment options ❯ Facilitate virtual shopping ❯ Activate live chat ❯ And enable contactless checkout with QR codes. ❯ Offer more order fulfillment options ❯

Some customers want to check out online but return products to a physical store, or browse in-store and buy online. According to a commissioned Forrester Consulting study conducted on behalf of Shopify, for 47 percent of consumers, these factors have a significant influence on their purchase decisions.

Give shoppers more flexibility by offering more order fulfillment options such as buy online, pickup in-store (BOPIS), curbside pickup, and click and collect. Use an app like Zapiet to let your customers select a pickup or delivery date while making sure inventory is available.

Facilitate virtual shopping Virtual shopping apps like HERO are pandemic-proof. Shoppers can instantly connect with a store employee who’s working from home, in-store, or at a head office, via chat, text, or video. During these real-time conversations, store staff can provide tailored product recommendations, and

customers can virtually try on products, ask questions, and browse your store online.

Activate live chat According to a commissioned Forrester Consulting study conducted on behalf of Shopify, forty-two percent of consumers say they’re likely to use live chat in the next year, making it an important channel for retailers in 2022 and beyond.

Add a live chat feature to your website so shoppers can instantly contact you or your staff with questions while they browse online. Answering questions quickly and giving shoppers the same level of service they’d experience in-store will help improve the customer experience and your conversion rate. You can use Shopify Inbox to activate live chat on your eCommerce website.

Enable contactless checkout with QR codes During the pandemic, QR codes gained popularity in retail.

According to a commissioned Forrester Consulting study conducted on behalf of Shopify, in the past year, 20 percent of consumers have used QR codes in-store to add products to their shopping cart and check out later online, and 33 percent of shoppers say they’re likely to use QR codes in the same way over the next year.

Shopify’s Shopcodes app is an easy way to generate QR codes.

Place them on product price tags to direct shoppers to product pages on your website or let them buy items in-store and have them shipped to their home address.

STEP 5 - Showrooming is increasingly popular among retailers According to a commissioned Forrester Consulting study conducted on behalf of Shopify, 46 percent of brands say they’re investing in showrooming over the next year to improve the in-store customer experience.

Showrooming lets customers touch, feel, and try your products in person and complete their purchase online later. Turning your retail store into a showroom has many advantages: Easier inventory management With showrooming, customers APRIL 2022

// 21

RETAIL MARKETING usually complete their purchase online, which means you can stock less inventory on your retail sales floor. This creates more space for experiential moments and engaging with customers. Depending on your space, you can either keep the bulk of your inventory in the stock room or in a warehouse.

Requires a smaller retail space If you’re not displaying multiple units of the same products on your sales floor, you’ll likely need less floor space and can opt for a smaller store.

This can help reduce your operating expenses or make it possible to afford a smaller commercial space in a more desirable location with higher foot traffic.

Provides cross selling and upselling opportunities With showrooming, you’ll have the opportunity to spend more time with each customer who visits your retail store (also known as clienteling), giving you more opportunities to cross-sell and upsell products. Also, depending on your POS, this one-on-one time will give you more chances to make personalized recommendations based on customer profiles and buying history.

GET STARTED: Want to support showrooming at your retail store?

Use Shopify POS email carts to add items to customers’ cart, send their wishlist by email, and help them buy online whenever it’s convenient for them.

STEP 6 - Retailers need to reimagine the store staff role to find and retain employees According to a commissioned Forrester Consulting study conducted on behalf of Shopify, 49 percent of brands say hiring and retaining employees will likely be a top challenge in the next year, and it’s something 40 percent of brands are striving to improve. This isn’t surprising considering employees at major retailers have been quitting, striking, and publicly expressing their unhappiness with the industry.

In the United States, job openings have hit record highs, and in the United Kingdom, employers are facing the worst shortage of job candidates on record.

The pandemic accelerated the evolution of the store associate’s APRIL 2022

role from an entry level position to “experience hosts” who manage shopping channels such as live chat, virtual shopping, appointment shopping, and a new range of order fulfillment options. If you don’t provide training, growth opportunities, and compensation to match their new role, you’ll have a hard time keeping employees, which could damage your reputation with customers.

Happy and engaged employees lead to happy and loyal customers.

But how can you achieve this?

STEP 7 - Consumers continue to be increasingly conscious Ethics, values, and transparency are increasingly important to shoppers.

In fact, 83 percent of millennials want brands to align with their values. And according to Forrester, 68 percent of US consumers say a brand’s social responsibility reputation has at least some influence on their purchasing decisions, while 48 percent of US consumers prefer to buy from a brand associated with social, political, or environmental ideals.

Offering transparency into your business practices and employee treatment, and sharing your viewpoint on political, social, or environmental issues can help foster trust in your brand and increase customer loyalty and advocacy.

STEP 8 - Customer loyalty is more important than ever According to McKinsey, 75 percent of consumers globally have changed brands at least once during the pandemic, and value, quality, and brand purpose are among the top reasons for trying a new brand. In the same study, McKinsey also reports, when it comes to physical retail, convenience, value, and availability are the top reasons globally for shopping at a new retailer.

While convenience remains a top retail trend, we can see that value is equally important to boost customer loyalty and retention.

Value refers to the quality and price of your products as well as the values your business stands for. According to a commissioned Forrester Consulting study conducted on behalf of Shopify, in the next year, 58 percent of

brands say they’re improving the quality of existing products and 53 percent are creating products that align with their company values.

STEP 9 - Consumers expect fast, free, and on-time delivery Free and fast delivery has a significant impact on purchasing decisions.

According to a commissioned Forrester Consulting study conducted on behalf of Shopify: ❯ 75 percent of global shoppers want free shipping, while 58 percent of consumers expect free next-day delivery. ❯ 68 percent of shoppers also want to know the estimated delivery date upfront, something they find valuable when making purchasing decisions. ❯ 49 percent of brands are investing in being transparent with not only their delivery practices but also their delivery promises (i.e., the date the order will be delivered).

PRO TIP: Want to speed up last mile delivery? Try setting up local pickup and local delivery in Shopify to give customers more order fulfillment options while speeding up last-mile delivery times.

STEP 10 - Building community is more important than personalization Brand communities have become increasingly popular over the last few years, and for a good reason — communities increase customer retention and brand awareness, and decrease customer support costs.

And using personalization to retain customers isn’t the best way forward. According to a commissioned Forrester Consulting study conducted on behalf of Shopify, 60 percent of consumers are increasingly concerned with how brands are using their personal information.

In fact, consumers are over three times more likely to abandon brands that “overpersonalize,” compared to brands that fail to personalize enough.

Customized communication that includes too much personalized data makes consumers feel like you’re stalking them.

But you can still generate customer loyalty and data through

community. Accessing customer data is highly dependent on trust, that’s why brands plan to invest more in connecting with shoppers to increase customer acquisition and retention. According to a commissioned Forrester Consulting study conducted on behalf of Shopify, 40 percent of retailers are investing in creating more opportunities for customers to directly interact with their brand — including building community.

STEP 11 - Retailers must continue to innovate the payment experience According to a commissioned Forrester Consulting study conducted on behalf of Shopify, in the next year, 58 percent of retailers plan to offer more payment methods, 48 percent plan to offer buy now, pay later solutions to customers, and 38 percent are investing in enabling one-click checkout.

With payment methods like buy now, pay later (BNPL) becoming one of the most popular financing options preferred by customers, retailers must continue to innovate the payment experience, whether it’s in-store or online. But this isn’t limited to financing options.

According to a commissioned Forrester Consulting study conducted on behalf of Shopify, in the last year, nearly one-third of shoppers abandoned their purchase because they couldn’t use their preferred payment method.

It’s crucial to offer a wide range of payment methods, including local payment methods or local currencies, and make the checkout process as frictionless as possible.

It’s your turn to implement a few of these retail trends Now that you know what retail trends are in store for 2022, it’s time to put them to work. Diving deeper into all the trends we listed above is impossible, but you can pick a few that apply most to your business and go from there. And if you’re not sure how to get started, check out our Future of Commerce report for recommendations to implement these retail trends.

ALEXIS DAMEN is a Shopify merchant turned digital marketer who specializes in content marketing and writing for SaaS and D2C eCommerce companies.

DMN.CA ❰

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// 23

CHANNEL SALES Pandemic converts B2B buyers to eCommerce, new capabilities and new expectations.

ISTOCK/ INSTA_PHOTOS

Building Next-Generation B2B Sales Capabilities

BY MICHAEL HARNEY, LIA KETOLA, KEDAR NAIK, NICOLAS PROBST AND STEVE REIS.

M

cKinsey has been researching B2B buyers and sellers around the world intensively over the past six years. What we’ve learned is that average buyers now use ten or more channels as they journey through the buying process, choosing digital self-serve for certain activities and video or in-person for others. Assumptions that once seemed unassailable— such as e-commerce being limited to small-ticket items—have also been roundly busted. Globally, 62 percent of B2B decision makers are now willing to spend $50,000 or more in online purchases—and one in five would spend more than $500,000.

To deliver excellence in APRIL 2022

today’s environment, B2B sales organizations will need to make three seismic shifts in the way they approach clients and lead teams: become omnichannel orchestrators, adopt a valuecreation mindset, and enable continuous change management (Exhibit 1).

These shifts will require sales organizations to re-skill significantly. Of the more than 400 sales leaders in Europe and the Americas polled in our most recent survey, 55 percent said that only about half of their sales force has the required capabilities.

Change is never easy, especially after two years of pandemicrelated upheaval. But our research and client work indicate that companies staffed with

top talent achieve significantly higher revenue growth. Here’s what’s required to deliver that outperformance.

1. Become an omnichannel orchestrator As buying habits evolve, sales excellence has increasingly come down to delivering the right experiences over the right channels. But with different stakeholders involved at different purchasing stages, sales leaders will need granular data and AI analytics capabilities to discern what information and which interactions are most helpful to reach specific audiences.

Our research shows that B2Bs with the fastest rates of revenue growth are far more likely to

equip reps with deal-level insights and account-specific customer intelligence. By comparing search data with sales data, for example, one B2B sales leader isolated which customers were using chat and which preferred email, so they knew the best channel on which to engage. Other analytics tracked competitor movements in specific regions, so reps could anticipate customer questions and prepare helpful responses.

Data-driven insights can also help leaders align and allocate coverage and resources more effectively. Instead of reviewing account coverage once a year, as is typical, outperforming organizations update account priorities and realign resources as frequently as once a month with DMN.CA ❰

// 24

CHANNEL SALES the help of resource modeling and planning tools. These skills require investment in analytical and quantitative abilities, account planning, negotiation, and relationship building—but that investment pays off in four to five times higher growth (Exhibit 2).

2. Adopt a value-creation mindset B2Bs with the fastest rates of revenue growth are approaching customers sooner and with a more consultative mindset. They’re partnering with customers more in designing tailored value propositions, eschewing the more typical B2B sales transactionand product-led focus. The new approach can be transformative.

One B2B packaging company approached a top manufacturing customer with a proposal to create a fully integrated packaging offering. Instead of simply selling the customer corrugated boxes, plastic wrap, and labels as usual, sales leaders hashed out a customized solution with the company, creating prototypes

“To ensure sales stick, leaders need to revisit performance management.” tailored to its top product line.

Running the numbers showed the approach would cost the company less than purchasing component packaging elements separately.

The B2B would gain as well, since the solution would embed the company’s packaging into the customer’s operations, creating an annuity revenue stream and the potential for additional crossselling down the line.

In our survey, approximately 85 percent of sales leaders said they believe that solution selling will be a core sales capability, requiring strong product knowledge and solution design as well as account planning skills (Exhibit 3).

To excel, sales leaders will also need to sharpen their communication skills and facilitate ideation with customers, pulling in technical experts when needed,

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running pilots, and establishing mutually-agreed-upon targets and goals. Pipeline development, upstream engineering processes, and the sales cycle itself will all need to adapt to this joint planning structure.

The value mindset underlying the solution sales construct should also extend to pricing. Sales leaders can play an important role in raising the account aspiration.

For example, they might wish to establish performance-based pricing and align the fee scale to mutually-agreed-upon outcomes.

This approach can involve more upfront risk, but it can result in a win-win for both parties and build greater customer lifetime value.

3. Enable continuous change management Next-gen sales leaders address all core elements of change management. They move with speed through agile workflow.

They tell compelling, “what’s in it for me” stories, and they refresh their training, development, and incentive programs regularly.

In our survey, roughly 65 percent of sales leaders said they believe that the speed of change has increased over the past few years, and 85 percent believe that adopting agile working methods will be critical for success in the coming years. One sales leader at a B2B manufacturer noted, “It was during the depths of the pandemic when we realized things needed to be different. We started trying new things in small groups to see what worked and what didn’t. This agile mindset helped us so much.”

Instead of taking on big, complex projects and implementing them over many months, for example, topperforming teams lean on practices that support rapid test and learn and break projects into smaller sprints of one to two weeks, with an emphasis on getting a minimum viable product out to customers quickly. They place similar emphasis on adapting the culture of the sales organization,

role modeling desired behaviours, and helping sellers understand what they can gain by embracing new ways of working. As one sales VP explained, “The ‘aha’ moment for our team was when we asked reps for their thoughts on the transformation and it became clear they didn’t really understand why we were making it. So we spent time making the change story very clear, empowering the frontline, tying incentives to the new behaviours, and reinforcing these behaviours through our performance-management systems.” None of this can be left to chance. Sales organizations need to carve out time for peer coaching and weekly check-ins and make mentorship a requirement for all leaders.

Training needs to change as well.

Instead of broad-brush approaches, organizations generally find more success making the learning individualized and experiential— enabling sellers to focus on specific capability gaps and apply what they’re learning to active sales opportunities. Our research shows that most organizations need to re-skill roughly half their sales force and plug key gaps in core commercial roles (Exhibit 4) To ensure changes stick, leaders also need to revisit their performance-management and incentive structures, adjusting metrics and rewards to maintain momentum and sustain gains.

By learning from this convulsive period of change, sales leaders can do more than simply adapt their teams to the demands of today’s B2B environment; they can lead in delivering a new level of performance. Organizations that lean into acquiring the capabilities required to deliver excellence in next-generation sales will be able to forge mutually beneficial, longterm customer relationships and deliver significantly greater ROI. MICHAEL HARNEY is a partner in McKinsey’s New York office, LIA KETOLA is a senior expert in the Luxembourg office, KEDAR NAIK is a partner in the Brussels office, NICOLAS PROBST is an associate partner in the Berlin office, and STEVE REIS is a senior partner in the Atlanta office. The authors would like to thank Bastiaan Dillmann, Boudewijn Driedonks, Liz Harrison, Ryan Paulowsky, Kate Piwonski, Candace Lun Plotkin, and Jennifer Stanley for their contributions to this article.

APRIL 2022

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lobal eCommerce fraud protection leader ClearSale has released its annual report on trends in online consumer attitudes and behaviors. The report illustrates the profound changes the pandemic has made to global eCommerce and offers retailers a roadmap to improving customer experience, fraud-control processes and ability to build long-term customer relationships.

The State of Consumer Attitudes on ECommerce, Fraud & CX 2021 report analyzes insights collected from more than 5,000 online shoppers equally distributed across Canada, the U.S., the U.K., and Australia, based on their eCommerce experiences from March 2020 to March 2021. The survey was conducted with the help of the Dynata data and insights platform.

Among the key findings: ❯ The pandemic brought more consumers online. 13 percent of the consumers surveyed shopped online for the first time ever because of the pandemic. ❯ Younger consumers don’t like to pay with cards. Only 20 percent of shoppers under the age of 55 have their credit card handy when they shop online. ❯ Older consumers don’t care as much about personalized experiences. Just 11 percent of shoppers aged 65 and older want to see product suggestions based on their shopping habits, a lower percentage than younger age groups. ❯ Checkout needs to be simpler for everyone. 35 percent of online shoppers leave before buying if checkout is too complex or takes too long. ❯ False declines drive customers away for good. 40 percent of consumers will boycott a merchant after a false decline. ❱ DMN.CA

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Online Shoppers in Five Major Markets Share eCommerce Insights

Together, the data in the report paints a picture of consumers with high expectations for eCommerce experiences and little patience for retailers who fail to meet those expectations. “This report shows that every eCommerce business needs to put themselves in the shoes of their customers,” said Rafael Lourenco, ClearSale EVP and Partner. “Different customers want different things, but they all want a great customer experience. Every part of your business, including your fraud protection, needs to align with delivering personalized and excellent CX.” The report also looks at which industries have been most successful at pivoting to eCommerce and which lag, covers current best practices for eCommerce brands, and discusses global trends that emerged from the survey data, including changes in online spending, cross-border shopping habits, and fraud and false decline experiences.

Overall, the data shows that “customers are in the driver’s seat,” said Rick Sunzeri, Director of Enterprise Accounts at ClearSale. “In an international market where items can always be found cheaper, eCommerce businesses can avoid that revenuedraining race to the bottom by providing an amazing customer experience.”

The State of Consumer Attitudes on ECommerce, Fraud & CX 2021 Report is available from ClearSale.

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