Direct Marketing Magazine January 2018

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The state of customer service technology

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How analytics can improve your marketing ROI

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The next wave of loyalty programs

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vol. 31 • No. 1 • January 2018

Millennial myth busting ❱ 10

New research indicates Millennials consume flyers and coupons in all formats

The Authority on Data-Driven Engagement & Operations

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Vol. 31 | No. 1 | January 2018 EDITOR Sarah O’Connor - sarah@dmn.ca PRESIDENT Steve Lloyd - steve@dmn.ca

In 2018, customer centricity is no longer enough

Data Storage Options ❯❯12

Embracing the Cloud

Direct Mail Prospecting

DESIGN / PRODUCTION Jennifer O’Neill - jennifer@dmn.ca Advertising Sales Mark Henry - mark@dmn.ca CONTRIBUTING WRITERS Lisa Orpen Dominic Clare Catherine Pearson Jerrid Grimm Jessica Schaeffer Rene Heroux Shane Schick Lynn Lang Mary Claire Mandeville Shannon Warner Jim O’Reilly LLOYDMEDIA INC. HEAD OFFICE / SUBSCRIPTIONS / PRODUCTION:

302-137 Main Street North Markham ON L3P 1Y2 Phone: 905.201.6600 Fax: 905.201.6601 Toll-free: 800.668.1838 home@dmn.ca www.dmn.ca EDITORIAL CONTACT: Direct Marketing is published monthly by Lloydmedia Inc. plus the annual DM Industry Guide.

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The state of customer service technology

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When it comes to direct mail, precision is key Environics Analytics’ new partnership with Cleanlist is giving clients like CAA Atlantic access to best-in-class contact and data hygiene solutions

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Steinbach Credit Union uses postal code data to acquire more members Thanks to Postal Code Targeting from Canada Post, this financial institution refines the reach of its marketing mix and boosts results

POSTMASTER:

How analytics can improve your marketing ROI If your marketing strategy is geared toward attracting new prospects you better know who they are

Engaging Lapsed Customers ❯❯16

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Please send all address changes and return all undeliverable copies to: Lloydmedia Inc. 302-137 Main Street North Markham ON L3P 1Y2 Canada

The next wave of loyalty programs Winning over consumer hearts and minds

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Millennial myth busting New research indicates Millennials are omnichannel shoppers, consuming flyers and coupons in all formats January 2018

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Three things a direct marketer can learn from branded content

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Six tips for launching a social strategy in 2018 DMN.ca ❰

Customer Centricity

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In 2018, customer centricity is no longer enough I Mary Claire Mandeville heads up Vennli’s agency practice. She believes in the power of understanding customer and consumer insights to provide a competitive advantage for any organization striving to create meaningful and lasting growth. She has focused her passion and harnessed her previous experiences and education to help agencies differentiate in a highly competitive market and increase their win rate by delivering deep marketplace insights in their new business pitches. Mary Claire has a BBA and MBA from the University of Notre Dame. Her experiences span from start-ups to corporations, from social entrepreneurship to financial institutions, and from Central America to back home in the U.S.

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f you’re a regular reader of marketing and strategy literature, you’ve no doubt seen countless stories about customer centricity in recent years. Nine in 10 CMOs agree their organization is trying to become more customer-focused. Customers have become more powerful thanks to the endless opportunities of the internet: increased competition for business, social media and the distribution of information. As a result, companies—particularly marketers—have been forced to adapt.

Jack Welch, former CEO of General Electric, famously said: “We have only two sources of competitive advantage—learning more about customers faster than competitors and turning that learning into action faster than the competitors.”

The true purpose of a business is to provide value to customers. Over time, the focus has shifted away from that idea and become centered on product, operations or sales, but customers’ demands have swung the pendulum back the other way.

Today’s fastest growing brands are differentiating themselves with excellent customer experiences, but customer centricity alone is not enough. Businesses don’t win by serving customers well; they win by serving customers better than their competition.

Al Ries, co-founder and chairman of the consulting firm Ries & Ries, has pointed out that the vast majority of companies are trying fervently to develop better products and market them better to customers.

When this doesn’t work, they settle for being the cheaper option.

According to Ries, too many businesses treat marketing like warfare: a battle for territory.

That approach leads marketers to predictable thinking and even less surprising results. Instead, Ries recommends focusing on the path of “least expectation.”

In other words: be different—that’s what builds strong brands.

Too many businesses have a two-circle approach: one for the value of their company,

and the other for the value customers want. This way of thinking is certainly customer centric. It’s the foundation for creating products that customers want and love; however, it’s not enough. Customers make choices in a competitive context—they have options. Therefore, businesses must provide unique value in order to win their choice. They must consider a third circle: the value a competitor offers customers.

This creates an intuitive three-circle Venn diagram that visualizes how customers make choices in a competitive context.

Each area has significance for both understanding customer choice and taking actions to build competitive advantage. Every customer has a variety of needs of varying importance. Company A may meet a number of those needs effectively, but Company B might also meet many of those same needs and provide some unique value that Company A doesn’t. Usually, the consumer has at least one need that neither offering meets that falls in the Yellow Zone. This is where innovation occurs: one company identifies an opportunity to meet a previously unmet need.

These insights are often a big help in understanding why sales have declined or stalled. If you want to win the customer’s choice more often, you must move the factors that drive customer choice into your Green Zone (i.e. your competitive advantage). It all comes down to these nine words: Be different from competitors in ways important to customers.

It may sound simple, but it’s not easy. The reality is there are a lot of complex factors that come into play when applying this nine-word prescription to your brand. You must create value that matters deeply to customers, is different from competitors and is based upon unique company assets and skills. Customers have a choice; you want to make sure you’re the leader in the factors that matter to them.

So, to circle back to Jack Welch’s quote, not just any customer data will do. As a marketer, you need data that illustrates the deciding factors of customer choice before your competitors know the answers. You must move beyond customer centricity and adopt a wider lens: If you place all your focus on your customer and lose sight of what is going on in your market, you’ll be left with a huge blind spot when it comes to identifying what really matters.

At a minimum, consumers demand that brands have an understanding of their customer and provide amazing customer experiences in order to achieve even a modicum of success. However, in order to stand above the competition and win market share, your brand also has to be different in ways that are meaningful to the customer.

January 2018

Introducing Postal Code Targeting: an entirely new way to target and reach new customers Exclusively from Canada Post Connect with prospects in a whole new way. Now you can identify only those postal codes that match the profile of your ideal customers, then reach them with direct mail. Target using Canada Post audience insights, your own customer data, or combine them both for more refined targeting. You can even suppress existing customers within your selected postal codes, to keep your resources focused on acquisition.

Transform your acquisition marketing strategy with this powerful new solution from Canada Post Smartmail Marketing . canadapost.ca/pctargeting TM

™

Trademarks of Canada Post Corporation

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Direct mail prospecting

When it comes to direct mail, precision is key Environics Analytics’ new partnership with Cleanlist is giving clients like CAA Atlantic access to best-in-class contact and data hygiene solutions

By Catherine Pearson

C

AA Atlantic is more than a tow truck and now, thanks to a new partnership between Environics Analytics (EA) and Cleanlist, more Canadians will get to know everything CAA Atlantic has to offer.

Beyond roadside assistance, CAA Atlantic serves as a travel agency and offers extensive insurance products and services.

It also has an incredible member rewards program that offers members everyday discounts on accommodations as well as savings at a variety of retailers, restaurants and more. One in five households in Newfoundland, PEI, Nova Scotia and New Brunswick already rely on CAA Atlantic. The challenge for CAA Atlantic has been how to get that message out to underserved households, when many of those prospective clients only think of CAA when they need a tow.

When CAA Atlantic first turned to EA to help answer this question 11 years ago its marketing costs were rising but its response rates were down. The organization needed to be more cost effective in attracting the most engaged members who’d bring the greatest value. By breaking down CAA’s membership into one of five custom lifestyle-based target groups to better understand their members and their interaction with CAA Atlantic, EA was able to help CAA Atlantic determine where to focus their efforts and how to shape their message to reach those groups.

This was an important step, particularly with the optimization of their direct marketing campaigns, a critical pillar in ❱ DMN.ca

CAA Atlantic’s overall marketing strategy. The insights allowed CAA to engage select target groups according to how they could use CAA rather than how members have used them in the past.

This data is used to guide all of their marketing decisions, from forming a variety of travel and rewards partnerships to planning their media buys. But of the various facets of CAA’s media strategy, direct marketing continues to play an important role, so much so that CAA has expanded its direct mail campaign in recent years by adding three campaigns, pushing their total up to six a year.

“The tools that EA provide us with will help us market much more intelligently. We are better able to deliver the right product, to the right member, with the right message, in the right channel,” says Gary Howard, vice president of marketing and communications of CAA Atlantic. “EA is not just a provider of marketing products,

rather they provide CAA Atlantic with in-depth and insightful support and consulting with all of our marketing efforts.”

The program, which has already cut costs and driven member engagement higher, recently received another performance boost thanks to EA’s newly minted partnership with Cleanlist, a supplier of Canadian contact data and data hygiene solutions.

While there are a number of list sources available that offer contact information for direct marketing campaigns, no other contact list provider offers greater market penetration than Cleanlist’s ResponseCanada databases.

With more than 15 million consumer records, ResponseCanada is the deepest, most up-to-date database of contact information in the country. Notably, 85% of the records in ResponseCanada include mailing addresses; more than half of the records also include a name and phone number.

The depth of this contact list will give organizations like CAA Atlantic a significant boost in their direct marketing programs, since it will greatly expand their reach, particularly in their key markets of Nova Scotia and PEI. Before EA’s partnership with Cleanlist, CAA Atlantic grappled with shrinking lists from various providers, which were not being maintained with the same rigour.

“There has been a diminishing availability of names through all channels and this has helped to combat that in one centralized list source,” says Karen Stanley, CAA Atlantic’s director, marketing and communications.

The other advantage for companies like CAA Atlantic is the way in which Cleanlist maintains its records. To ensure their contact lists are current and as accurate as possible, ResponseCanada is

“People get offended when they update their contact information and continue to get mail at an old address or mail that wasn’t intended for them.”

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Direct mail prospecting updated continuously to identify properties that recently sold or are currently for sale while names from the do-not-mail lists cleansed and deceased names are suppressed. To ensure precise tracking the contact list also records the length of occupancy.

“We’ve worked with lists that are updated on an annual basis, at best,” says Stanley. This higher frequency of updates from Cleanlist helps to create a better relationship with the end recipient, she adds. “People get offended when they update their contact information and continue to get mail at an old address or mail that wasn’t intended for them.”

In addition to keeping records up-to-date, Cleanlist has the power to enhance client files by filling in some of the missing pieces of their contact information. Incomplete contact files are a persistent challenge for direct marketing campaigns since it prevents the mailing from reaching their

intended recipients. Cleanlist addresses this by appending information to client files, including hard to find information such as customers’ apartment numbers, which are frequently left out.

Better contact information means EA can do a more effective job targeting prospective clients, which will enable CAA to develop more targeted messaging.

Critically, ResponseCanada is easily linked to a wide range of consumer behaviours, preferences and characteristics, giving organizations like CAA access to EA’s core strength: its market data including DemoStats, Wealthscapes and more. Now with Cleanlist, EA can apply that to a much larger area. Through this

partnership EA can enhance its hybrid modelling techniques and provide an even richer suite of services to help organizations like CAA achieve even more with their marketing dollars.

Lastly, Cleanlist formats every address correctly to ensure the mailing reaches its intended target.

It’s a critical role that helps cut down on waste and improve the overall efficiency of a campaign. To put this into perspective, consider the potential waste there could be when you are sending out millions of direct mailings a year and paying 48 cents per piece, says Stanley. “If even a small percentage is not going

to the intended recipient it can result in thousands, if not tens of thousands in wasted postage costs.”

Thanks to the enhanced services that Environics Analytics can now deliver thanks to its partnership with Cleanlist and the forward thinking of CAA Atlantic, a greater number of Canadians know that CAA is more than just a tow truck.

Catherine Pearson is senior vice president

and practice leader for the finance, insurance, travel and telecommunications industries.

“If even a small percentage is not going to the intended recipient it can result in thousands, if not tens of thousands in wasted postage costs.”

January 2018

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Direct mail prospecting

By leveraging the power of postal code data, businesses can reach and engage with customers and prospects like never before.

Steinbach Credit Union uses postal code data to acquire more members Thanks to Postal Code Targeting from Canada Post, this financial institution refines the reach of its marketing mix and boosts results

By Shane Schick

An invitation to a brand-new audience Steinbach Credit Union (SCU) is Manitoba’s largest credit union and the eight largest in Canada.

To celebrate 75 years of business, it decided to give $7.5 million in cash back to its members, but wanted to spread the good news even further. The problem was finding people who weren’t already enjoying all the benefits SCU has to offer.

To enhance their annual campaign, SCU paired Canada Post’s Postal Code Targeting direct mail solution with digital and outof-home advertising to connect with potential new members.

“What excited us the most about Postal Code Targeting was the ability to leverage our existing ❱ DMN.ca

postal code data to find new members,” explains Stephanie West, marketing and advertising specialist at SCU. Through Postal Code Targeting, SCU was not only able to suppress the addresses of current members but also refine the list of new people it wanted to reach. Data from Canada Post was overlaid with SCU’s third-party data to identify five well-defined target groups.

Direct mail boosts digital results SCU mailed a postcard that included a unique URL where potential new members could learn more about all the benefits associated with SCU membership.

West believes Canada Post’s Postal Code Targeting mail not

only drove a substantial overall increase in new members, but boosted its success in other marketing channels, such as awareness of its billboards and traffic to its website.

“When you’re doing a mass marketing effort, every piece that you can connect together just reinforces the overall message,” she says. “I’m extremely satisfied with the results of this campaign.

Canada Post has made the process very easy working with us on our targeting, but also working with our printer in the production and delivery of the piece.”

“Postal Code Targeting is a really cost-effective way for organizations to reach a specific audience with a specific message,” says West. “It’s definitely

something we’re going to consider in the future as part of our total mix. We really look forward to working with Canada Post again.”

To see how Postal Code Targeting can help you reach your best prospects, visit canadapost. ca/postalcodetargeting.

Shane Schick is a freelance writer based in

Toronto.

• 39% increase in new members • 55% increase in website visits over the previous year’s campaign

January 2018

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Direct mail prospecting

Millennial myth busting New research indicates Millennials are omnichannel shoppers, consuming flyers and coupons in all formats

By Lisa Orpen

T

he accepted notion that young people spend lavishly on themselves may be another “Millennial myth.”

Some new research that our team at Metroland Media recently completed in collaboration with BrandSpark International to

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probe the Canadian shopper’s path to savings revealed a strong desire for deal-seeking among younger consumers. According to our study, more than 80% of Millennials select which stores to shop based on deals. What’s more, 46% of Millennials are “engaged” shoppers, suggesting that this segment is deeply involved in the

shopping process, more so than any other age segment.

Engaged shoppers are one of four unique consumer segments identified in the study. This type of shopper (which represents 34% of all flyer and coupon users) is characterized by heavy usage of both flyers and coupons; not only to find deals and savings, but

also for inspiration and to find information on new products.

Other segments include: Deal-seeking: Driven by their need to save money, Deal Seekers target stores and products that will help them stay within a predetermined budget—whether the need comes from lower

January 2018

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Direct mail prospecting

Check us out online dmn.ca

discretionary income or a desire to be a “smart shopper.” Flyers and coupons are the means by which they find deals and create a shopping list to help prevent impulse buying.

Utilitarian: Utilitarians are shoppers with little time and attention, who view shopping largely as a task to complete.

While deals and saving money are valued, they are secondary priorities to making shopping trips as fast and simple as possible. They use flyers as a tool to help build their shopping list as they search for nearby stores that carry the products they need.

Inspired: These trendsetters shop to enrich their lives and often look through flyers for new products, ideas and information. As with most Canadians, saving money is important, but they are willing to pay more for products that are of better quality and are better suited to their needs. These shoppers often read flyers out of sheer enjoyment.

It’s interesting to note that 68% of Millennials fall into two segments—Engaged and DealSeeking—both of which are characterized by deal-seeking behaviour. This savings-centric mindset is also reflected in how Millennial shoppers use flyers January 2018

and coupons. Fifty-five per cent of Millennials are omnichannel shoppers, consuming flyers and coupons in all formats (print, webbased, and in-app), compared to 19% of Baby Boomer respondents and 28% of the general population.

And while eight in 10 Millennials use a combination of print and digital media before hitting stores, only 10% are exclusively using digital flyers or coupons— suggesting that despite their plugged-in lifestyle, Millennials are not abandoning print along their path to savings. In fact, 51% of Millennials actually prefer printed flyers, versus only 25% who prefer to view flyers in an app.

Despite the deal-seeking tendencies of Millennials, retailers and manufacturers should consider leveraging these younger consumers’ enjoyment of shopping, desire for brand recognition and more spontaneous shopping habits to drive impulse purchases. In this way, more inspirational content in the flyer can help give brands a competitive edge when targeting this highlydesirable segment.

To access the full report A Consumer’s Path to Savings: The Role of Flyers and Coupons in Today’s Digital World, go to: metroland. com/path-to-savings.

For online advertising opportunities contact

Mark Henry, mark@dmn.ca For online editorial opportunities contact

Sarah o’connor, sarah@dmn.ca

Lisa Orpen is vice-president national and

multi-market sales, Metroland Media.

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Data Storage Options

Embracing the Cloud

By Rene Heroux

T

he world is awash with digital data. According to the research firm IDC, the globe will be creating 163 zettabytes of data every year by 2025. Zettabytes. That’s one trillion gigabytes. That’s an incredible amount of digital information and it needs to be stored somewhere.

Increasingly, organizations are realizing the most realistic place to put it is in the Cloud.

The Cloud has become something of a tech buzzword.

Simply put, it is a method of storing data on remote servers accessed through the internet. Software or services that run on the internet, instead of on a local computer, are said to be Cloud-based. Some of the most well-known examples are services like iCloud and Dropbox, powerful methods for transferring and storing data.

As the Cloud develops, it is becoming the gold standard for IT delivery and data storage. Scalar Decisions’ most recent research has found that almost 73% of Canadian organizations have moved at least some of their IT delivery to the Cloud, up from 56% in 2016.

Why the Cloud makes sense The benefits of moving to the Cloud are clear. It allows organizations to be more flexible with their operations, while offering increased security.

Instead of having sensitive data or programs stored only in one physical location, it can be accessible almost anywhere there’s an internet connection.

The Cloud makes organizations more efficient. In today’s modern business world, data needs to be constantly shared, transferred and reviewed. In older IT models,

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documents are stored in one physical location. With a Cloudbased network, employees in a Toronto office can review a project being developed in Calgary and be instantly shared with colleagues in Vancouver.

Another benefit is the flexibility of the system. As a company grows, the amount of digital information can begin to pile up, like so many stacks of papers on a desk. Without the Cloud, this company would need to continuously add new infrastructure to meet its storage needs. With a Cloud-based system, the increasing amount of data can be spread across networks, eliminating the need for pricey hardware.

It’s easy to remove data from the Cloud and reduce your storage footprint. With physical storage, the hardware investment is a sunk cost—one that can increase rapidly and requires frequent service by IT departments. The Cloud allows companies to only pay for the storage they need.

The Cloud is secure The very public security breaches that have occurred in the past year have grabbed a lot of media headlines. But they haven’t prevented organizations from migrating to the Cloud. According to our most recent study, 90% of Canadian businesses that are concerned about security have moved past those fears and implemented some form of Cloud system. Security is no longer the main barrier for organizations looking to change their IT delivery models.

As the Cloud’s storage-based services have matured, they have added robust security features such as encryption-at-rest (bring

your own key or use Cloudgenerated keys), integrations with Key Management Services to ensure key rotation on a regular basis, encryption over-the-wire, robust Identity & Access controls, and full auditability. When leveraged properly, public Cloud storage services will almost always be more secure than on-premise solutions because of the amount

two. A private network offers computing services delivered over the internet by a third-party provider, which is dedicated to a single group. A public Cloud is similar, but it can be accessed by many customers at the same time.

Think of Amazon Web Services and Microsoft Azure. Hybrid Clouds are a mixture of the two and traditional in-house IT, that allows

Using a hybrid Cloud has become the primary choice for most Canadian companies, with 67% of Cloud users choosing it. of security services and features available. It would be almost impossible for any enterprise to employ a similar security protocol on their own.

That said, companies can’t get complacent. Once implemented, they need to be consistently updating protocols to match evolving security risks. What may have been adequate security a year ago may not fully protect against the ever-changing cybercrime landscape. The damaging security breaches over the past year have opened the eyes of Canadian organizations to the risks posed by hackers. Companies need to regularly conduct assessments of security preparedness levels.

The Cloud isn’t one-size fits all Organizations have options when choosing what kind of Cloud-based network they want to implement.

The most common systems are private, public or a hybrid of the

the same solution to be delivered in any of these ways.

Using a hybrid Cloud has become the primary choice for most Canadian companies, with 67% of Cloud users choosing it. The size and needs of a company will determine which is the best fit to ensure their data is secure and they are receiving the maximum return on investment.

The Cloud is still a relatively new technology. But with digital data flooding the market, organizations need to be seriously considering where they will store it all. While no method will ever be completely secure, the Cloud is a safe, efficient and flexible model that allows growing organizations the opportunity to scale up fast. If they haven’t done so already, 2018 needs to be the year organizations consider the Cloud.

Rene Heroux is chief technology officer, Scalar

Decisions.

January 2018

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Advertorial

How to Turn Your Subscribers Into Loyal Customers

By Greg Zakowicz, senior commerce marketing analyst, Oracle + Bronto Consumers are checking their email more often, and on more devices, than ever before. It’s not hard to see that email remains one of the most effective ways to reach customers. For savvy marketers, meeting consumers at this vital touchpoint is an opportunity that can’t be ignored.

But when it comes to consistently growing subscriber databases and maintaining subscriber engagement, the struggle – as they say – is real. Marketers often make the mistake of focusing on acquiring the sign-up, and then reverting to a generic batchand–blast messaging strategy. But this causes your subscribers to disengage earlier. They expect you to send them relevant, personalized experiences. And if you don’t deliver, you can wave goodbye to those subscribers you worked so hard to acquire.

So, how do you grow your list size in a way that will help you collect the right customers and keep them engaged?

Be Consistent – and Creative When looking to steadily grow your contact database, you need to take a consistent, multi-pronged approach. There are a few ways you can do this. First, include a sign-up above the fold of your homepage, or even better, on all pages of your site. This gives consumers an easy way to sign up while browsing on your site.

This is especially important if they link directly to a product page from the web. Limiting the signup to only the homepage decreases your ability to secure a new subscriber.

You’ll also want to consider popups, dropdowns, and ribbons.

These strategies are front and center to new visitors and are routinely the most effective list-growth tactics. Of course, don’t ignore other areas of growth: Include social pages, co-registration partnerships, and brick-and-mortar stores.

Now to address the elephant in the room: Should you offer an incentive for singing up? The answer is – it depends. Be wary of training your customers to wait for discounts to make purchases.

You can always get creative when it comes to what to offer: A free gift with their next purchase, a weekly or monthly raffle for a gift card or other prize for new signups, or even partner with a cause that is meaningful to your subscribers – which is another great way to personalize.

For example, if your brand sells men’s underwear, consider supporting a testicular cancer foundation. Promote and communicate this cause on your website, and ask them to sign-up to receive more information on how they can help get involved. You can even provide a “coupon code” to use at checkout that will allow that discount to be donated, rather than taken off the purchase price. This way the consumer becomes emotionally connected, and the brand can track the effectiveness of the campaign.

January 2018

Get Personal You’ve acquired new subscribers. Now it’s time to personalize their experience. Regardless of the products you sell – men’s underwear, cookies or car parts – personalization (even on a small scale) can have a deep and lasting effect. It can be the difference between keeping subscribers engaged – or having them hit “unsubscribe.”

The good news is that difference is entirely up to you. Even if you are using a batch-and-blast email strategy, look for areas where you can maximize personalization and create a bond with your customer. This could be acquisition source (on-site), email or purchase behavior. If you know your subscriber signed up to receive emails while viewing men’s shoes, your welcome message or series should have a high focus on men’s shoes. Include intuitive product recommendations in your batch-and-blast messages – making them immediately more relevant. If users click on a maternity link inside of your emails, they should be sent emails focused on maternity items. If they are a recent purchaser, helpful tips on how to care for a newly purchased product is a great way to build trust and provide value to a customer.

The best part of all of this is that this can all be automated, taking a large burden off your team.

Make Them Believers Commerce marketing isn’t about acquisition versus retention – it’s a combined strategy. You want to acquire the right customer and then engage them effectively along the way by showing that your brand understands them.

Focusing on your overall strategy will help get the right message, to the right customer, at the right time. This is where using segmentation, automation, send frequency and personalization can help.

Remember: One-size-fits-all might work for concert t-shirts, but it rarely – if ever – works for email.

About Greg Zakowicz

As a former consultant with more than 10 years of experience in email, mobile and social media marketing, Greg Zakowicz has first-hand knowledge about the challenges facing the retail industry. Now, as Senior Commerce Marketing Analyst at Oracle + Bronto, he provides thoughtful insight to the Internet Retailer Top 1000, and is a frequent speaker at ecommerce events.

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Data Storage Options

The state of customer service technology

By Jim O’Reilly

T

he advance of mobile technology throughout our society is forcing significant change on the customer service and call centre segments.

Self-service response apps are becoming standard, which means the voice-response service is being de-emphasized and also changed from being the first response to damage control when the mobile app fails. At the same time, turnover of call reps due to poor job satisfaction is running at around 40%, raising training costs, disrupting productivity and damaging the brand’s image.

The ratcheting of mobile selling, using Big Data techniques to target a customer’s needs in real time, changes expectations for the service response profile, too. Any failures to meet ever-accelerating windows for response and accuracy and depth of information cause friction with customers. This impacts customer loyalty, perhaps more so than with the same issue in a web page, due to the customer already being frustrated by having to go to customer service.

One solution is the chatbot/ virtual assistant, providing a more human-like interface to a Q&A session by answering free-form queries. Chatbots are getting smarter and better at anticipating customer responses and thereby getting to the point much more quickly (I just sat through a phone sign up where the human call agent

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insisted on reading every option for each question before I could reply! Avoiding that and getting right to the point is where chatbots are going).

Free-form input offers customer service a way to answer the odd-ball questions without interminable lists in a pull-down menu, or having to go through several pages to find the right issue.

Good chatbots require compute horsepower and good design to succeed and, today, this means hooking artificial intelligence (AI) into the loop.

Affordable AI is a new area of computing, made possible by solutions in the public Clouds. It allows information to be presented in context both to the chatbots and to human operators, which improves response accuracy, time to clear issues and the professional image of the brand. As with marketing and selling, Big Data analytics can add to the solution by both broadening the concept and adding real-time information to it.

The aim, of course, is to completely automate service response. This adds a need for speech recognition/output and the use of multiple media channels to the solution. With all of these (available) options a sophisticated data centre will answer a caller with app-based Q&A using spoken queries and responses preferentially over option selection on a web page, coupled

with the opportunity to display information in concert with the voice response and to use IM to pass personalized information such as access codes.

Customer support centres face more complex challenges, since the behavior (or misbehavior) of sophisticated smart devices is often involved. Personalization of the solution to the specific product needing support is easy enough, but even naming products or giving model numbers is errorprone and needs a patient and forgiving app to mimic human support.

The level of sophistication we are describing needs a scalable compute solution, which we find today in public Clouds. The Cloud approach removes most of the upfront investment in IT for call centres and should also allow Software-as-a-Service models to avoid upfront software licenses.

This is especially important in the early, exploratory days of building out a state-of-the-art centre, since errors such as needing less hardware or having to change software vendors can be erased within days. As in the general computing environment, public Clouds also provide a low-cost, pay as you go development sandbox.

Another area that digital transformation addresses is personnel quality. Those data analytics approaches can be turned onto the human agents

working in the centre, while being ready to monitor automated agents downstream. Feedback on performance, such as clearance time, customer satisfaction and so on can improve the agents’ operations and weed out unsatisfactory players. The analytics also can be used to spot problem customers, whether from frivolous issues to recurring nightmares, with both escalation and management reach-out options to save the customer.

Use of the Cloud allows agents to be distributed geographically.

Combine that with sophisticated phone call distribution and remote operations are possible, allowing for a happier workforce and better hiring flexibility. The analytics dashboards can monitor throughput and performance and prevent skiving off!

Jim O’Reilly has been an executive at a number

of corporations and startup companies.

Recently, he was vice president of engineering at Germane Systems, creating ruggedized servers and storage for the U.S. submarine fleet. He has also held senior management positions at SGI/Rackable and Verari; was CEO at startups Scalant and CDS; headed operations at PC Brand and Metalithic; and led major divisions of Memorex-Telex and NCR, where his team developed the first SCSI ASIC in the industry, now in the Smithsonian. Jim is currently a consultant and writer, focusing on storage, infrastructure and software issues.

His book on the future of storage, Network Storage, has recently been published.

January 2018

// 15

Feature

How analytics can improve your marketing ROI If your marketing strategy is geared toward attracting new prospects you better know who they are

By Dominic Clare

W

hen your marketing team tells you “I think” or “I feel,” it’s time to be cautious. Trusting only your gut to tell you what might resonate with your target audience can not only undermine the success of your campaign, it often leads to bad investment decisions. While we know the best campaigns come from the right combination of the art and science of marketing, our experience shows that evidencedriven decision making results in better ROI. The challenge with building a campaign based on instinct alone is that you risk overlooking prospects. Rather than guessing what customers want, marketers need to focus on what they can prove so they can make smart, evidence-based decisions.

Yet many organizations are reluctant to admit they don’t know everything about their own customers and executive teams resist change that would help them succeed. In the recently published 2017 CMO survey by Deloitte and the American Marketing Association, 68% of marketers say they don’t use analytics to make everyday business decisions and 32% lack adequate analytic tools and processes for measuring success.

This is unfortunate, especially given how easy it is to fill in the missing pieces to build out a complete view of the customer.

Here’s what happens when organizations challenge this norm.

Earlier this year Environics Analytics began working with two large organizations to help them maximize their marketing investments. One is a large financial institution and the other is a wellknown automotive company.

Both organizations saw an opportunity to identify new prospective customers by integrating their internal data with third-party data. While the two organizations operate in different spaces, the process was similar. In January 2018

both cases, Environics Analytics helped them combine their internal data with a rich dataset, containing up-to-date demographic data as well as insights into the social values of consumers. This process allowed both organizations to look beyond what customers were buying to gain insights on everything from their spending power, age and household size to whether they like sports and prefer cooking to eating out.

Based on this information EA built personas around groups that exhibit similar behavioural patterns. These personas serve two important purposes. First, they help organizations learn more about who their best customers are. And second, they give organizations guidance on who they might want to target. It could be groups that share similar traits to their best customers or groups that are inexplicably underrepresented and could be a source of new growth. The same data can be used to identify the best way to reach those prospects.

By understanding the segments and their personas through this integrated intelligence, both organizations were able to make informed decisions about their media strategy. This allowed them to develop a coherent communication strategy with their media partners and helped them shape the creative to reach their target audience. It also enabled these two companies to track and measure their performance to give them a clear view of their return on investment.

The results speak for themselves.

The automotive company EA worked with used analytics to guide its messaging for a particular line of cars in its portfolio in one province while it adopted a more traditional marketing approach in the rest of the country. The provincial campaign that relied on analytics saw sales jump by eight per cent for the target product line, while the sales for that same

product slipped by double-digits in the rest of Canada.

The Canadian financial company EA is working with is now starting to differentiate its services based on segments, to unlock hidden opportunities and develop new relationships.

As an added benefit, these early wins are helping convince both of these large companies to knock down barriers to improve the flow of information between departments. Both companies have similar words of advice for any company that wants to learn more about their customers: ❯❯ Being data driven doesn’t need to be overwhelming; ❯❯ Knowing who your target audience is really creates better

❯❯

campaigns; and Business challenges become more manageable with a datadriven collaborative approach used by all stakeholders.

While there is always resistance to change, the return on investment that analytics can deliver will convince any executive that this is a worthwhile endeavour. While there are no certainties when it comes to marketing, moving away from “I think” to “I know” will deliver measurable improvements to your campaign’s accuracy and reach.

Dominic Clare is senior vice president, consulting, at Environics Analytics.

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// 16

Engaging Lapsed Customers

Three things a direct marketer can learn from branded content

By Jerrid Grimm

I

n recent years, branded content has flipped the marketing industry on its head. Last year alone, U.S. marketers spent a whopping $10 billion on content marketing in an attempt to better engage their audiences—and many have been successful at it.

According to our 2017 Branded Content Benchmark Report— which measures how well branded content performs—consumers are spending more time engaging with branded content than ever before.

Despite dwindling attention spans, the average active reading time for a piece of branded content increased from 66 seconds in 2016, to 73 seconds in 2017. For context, the average amount of time people spend reading an email is just over 11 seconds.

While the two marketing practices are inherently different, direct marketers have the opportunity to draw inspiration from branded content and further enhance their own email campaigns by implementing the following tactics.

Consider weaving in a narrative Branded content is able to hold a consumer’s attention for upwards of one minute because readers are getting something of out it—they’re entertained or being provided with information they ❱ DMN.ca

deem relevant. It’s all about telling great stories.

And, in truth, so is direct marketing. Marketing professionals have an opportunity to weave a narrative into email campaigns and capture the audience’s attention for as long as possible. This will help create an experience for the audience, help them identify with a story, and ignite emotion—all things that enable them to draw a personal and lasting conclusion about the brand.

One great example of a narrative-driven email marketing campaign is this one by non-profit organization Charity:water. After donating money, donors can see their money take a journey around the world. The email recipient gets progress reports about what their money has been used for and sees a project timeline that shows where their money has gone in the past.

There’s also a map that explains more about the work being done in the region.

Meal-kit delivery service Blue Apron offers another great example with a recent email campaign that provided customers with their year in review. In a simple blue infographic, it goes over things like how many meals they cooked, what ingredients they explored and how many local suppliers they supported. The campaign is personalized, gives the customer relevant data, and

encourages them to think back on the meals they shared—thus stirring emotions.

Get the most important points out of the way quickly Even when branded content is educational or entertaining, our data shows that less than half of people finish the entire article.

In true journalistic style, it’s important to capture the reader’s attention early on. Don’t waste any time getting to the who, what, where, why, when and how. Direct marketers take note: the same should go for email marketing campaigns.

Upon receiving emails from a brand, consumers often skim through the copy. So do them (and yourself) a favour and keep the wording as simple as possible.

One email campaign from Uber is a great example—and plays on the fact that users scan emails.

It includes a big block of faded text—nine lines exactly—with less than 20 words bolded. “We know that you’re scanning this email to save time,” it reads. “Sync your calendar with Uber to save more.”

Optimize for mobile conversions In both branded content and email marketing, readers convert higher on desktop. While desktop users engage with branded content for less total time than their mobile counterparts, we found that 1.83%

of desktop users convert back to the brand’s site—double that of mobile users. And according to MailChimp, about 72% of clicks come from desktop users in email marketing campaigns.

But with more than 40% of emails and 57.6% of branded content being consumed on mobile devices, what can both groups of marketers do to increase mobile conversions? We need to invest time and resources into creating mobile optimized campaigns that are also conversion oriented.

Optimize email campaigns by using a single column layout and concise copy. Create a short subject line or content headlines that display well on smartphones, because many mobile screens can only fit four to seven words.

Also, use smaller images for faster loading and of course, make all the links highly visible to boost conversion rates.

Yes, branded content and direct marketing do have their differences, but ultimately they have the same goal: to engage the audience with meaningful information. In this, there’s a huge opportunity for direct marketers to use insights from branded content to increase engagement on their own campaigns.

Jerrid Grimm is the co-founder of Pressboard, the platform brands use to buy and measure sponsored content.

January 2018

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Engaging Lapsed Customers

The next wave of loyalty programs Winning over consumer hearts and minds

By Shannon Warner and Lynn Lang

B

rand loyalty is critical to businesses of all sizes and sectors, but what makes a successful loyalty program and prevents consumers from jumping ship when a better offer comes along?

When organizations are looking to foster loyalty, many forget the most important driver: emotions.

A report by Capgemini’s Digital Transformation Institute found that emotional attachment has the greatest influence on loyalty of any indices studied. In fact, meaningful brand loyalty is impacted more by emotions than points, rewards or even price.

Smart organizations balance both rational and emotional factors for customer engagement and loyalty.

However, broadly speaking, current loyalty approaches are broken. Eighty per cent of executives believe they understand consumer emotions, but only 15% of consumers agree. This comes at the expense of the brand. â?ą DMN.ca

In order to upgrade their loyalty programs to be effective and engaging, organizations can implement engaging and relevant experiences that matter to the customer, with loyalty as the strategic outcome.

Emotionally engaged consumers are better for your business The new report examines the correlation between emotions, rational elements and brand values in relation to consumer loyalty. Overwhelmingly, across the four sectors examined (retail, financial services, automotive and telecom), the correlation between loyalty and emotions is highest.

Brand traits such as honesty, trust and familiarity mean more to consumers than price competitiveness, promotions or corporate social responsibility.

Emotional connection often translates into monetary value for brands. Eighty-two per cent of consumers with high emotional engagement would always buy the brand they are loyal to when making purchasing decisions, compared to 38% of consumers with low emotional engagement. In addition, 81% of emotionally connected

consumers will promote the brand among their family and friends and 70% will spend up to twice as much with brands they are loyal to.

In the retail sector specifically, increasing the level of emotional engagement could drive a five per cent increase in annual revenue.

Augmenting loyalty initiatives with tactics that foster emotional connection to the brand (both within and beyond the loyalty program itself) will generate additional lift, help retain the most valuable consumers and result in greater spend by loyal consumers.

Furthermore, emotionally engaged consumers have higher expectations of the brands they feel loyal to. For example, they expect brands to know their individual preferences on a personal level, meaning personalized product recommendations, shopping habits and even in-store or online experiences. The discrepancy between what executives think and how consumers feel

demonstrates the need for brands to improve loyalty programs across the board and incorporate tactics to create an emotional connection.

Follow four principles to create an emotional connection Retailers need to change the way they build relationships with consumers so they are focused on engagement and mutual trust, rather than being transaction focused. To drive loyalty, retailers should use the following principles to create strong positive emotions and deeper engagement with their customers.

80% of executives believe they understand consumer emotions, but only 15% of consumers agree.

January 2018

// 19

Engaging Lapsed customers

1. Respect: Companies can show respect to their consumers in a variety of ways. For example, they can respond to queries in real time, ensure they do not make them wait, and use the information that consumers share to improve their experiences. Such actions will enhance consumers’ feelings of honesty, trust and integrity toward companies.

2. Reciprocate: The two-way nature of loyalty makes it something people enjoy giving as much as receiving. There are a number of ways brands can build that sense of reciprocity.

When a consumer shares his or her information, the brand should use it. When a consumer complains about a product or service, the brand should respond promptly and authentically.

When consumers cross a milestone (e.g. spend, history), the brand should thank them.

3. Recognize: Brands need to treat their consumers as individuals that are unique and special.

Information about consumers can be acquired through many channels, including mobile apps and facial recognition, which can January 2018

In the retail sector specifically, increasing the level of emotional engagement could drive a 5% increase in annual revenue. be used to deepen relationships.

4. Reward: Brands need to create experiences that promote long-term relationships and go beyond transactional metrics.

Rewards come in many forms.

For example, from things that have monetary value (e.g. competitive prices, special sales), to things that make people feel special (e.g. quality products, exclusive access), to things that make their lives easier (e.g. shorter lines, self-service options), or to an opportunity to give back (e.g. social advocacy).

Brands should offer rewards and incentives that consumers care about such as personalized product recommendations, allowing consumers to choose rewards they deem most valuable to them and

celebrating special moments in consumers’ lives.

A balancing act While emotions have the strongest correlation to loyalty, rational factors and brand values are still important. Depending on your business, your target consumer may prioritize rational factors or brand values over emotions.

It is important to understand the target, their priorities and what kind of experiences they value most.

Although the majority of consumers value emotional engagement, it is not true of every consumer. Striking the right balance is difficult, but key.

Experiences that matter Although current loyalty programs may be broken, there is a path forward. As competition and

choice continue to grow, brands need to ensure they know their consumers at a more “human level” to foster lasting connections. They need to create a contextual view of the consumer and their journeys with their brand to understand their evolving needs and desires.

Brands must then design and execute compelling and engaging experiences that matter, where loyalty is the strategic outcome.

Doing this will help brands to shift a significant portion of their consumer base from having a transactional relationship to one where meaningful experiences ultimately drive emotional engagement and secure sustainable long-term loyalty.

Shannon Warner leads Capgemini Consulting’s

North American retail practice and Lynn Lang is a digital expert with Capgemini Canada.

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Six tips for launching a social strategy in 2018

By Jessica Schaeffer

T Jessica Schaeffer

is chief of staff and director of marketing & communications at LaSalle Network, a national staffing, recruiting, culture firm recognized by more than 70 culture and revenue-based awards. Schaeffer has been at LaSalle Network for six years and is on the board of directors for the American Marketing Association.

here are so many social media channels out there, with new ones developing every month— Instagram, Facebook, Pinterest, Twitter, Yelp, Glassdoor, LinkedIn, Snapchat, the list goes on and on.

As a marketer, you can get a lot of pressure to keep up with the Jonses’. You never want to be late to a trend, but you have to take the time to make sure it’s right for your business.

Here are a few things we consider before investing in a channel (because let’s be honest, it’s an investment— time, money, energy) and how we go about creating a social strategy.

Step 1: Do your research Take the time to learn the nuances of the channel.

Who engages on this platform? How easy is it to use?

What type of content is shared and by whom? How frequently is information shared? What are the days of the week and times of day that it’s most used? How are other brands utilizing the channel—both in your industry and outside of it?

Step 2: Ask yourself—does this make sense for our business?

The first thing we ask before investing in a new channel is does it make sense for our business? What a retailer does may not be right for a professional services firm.

What a Fortune 500 company does may not make sense for a start-up.

Look at competitors and how they are using the channel. Would yours be a mere imitation of theirs or could you make it unique and compelling? Ask yourself—how can we benefit from using this channel?

Do we have the team in place to support and maintain it?

Step 3: Do a pre-mortem Before investing in anything, we take a pre-mortem.

We talk about what could go wrong. What negative things could come about as a result of us activating this channel? Will our audience actually interact with us on this channel, or will it fall flat? If they interact with us, will it be in the way we hope, or will it become the Yelp of social media sites and be consumed by negative naysayers because of an undescribed proprietary algorithm? If we know exactly what to expect going in, few things will take us by surprise.

❱ DMN.ca

Step 4: Determine the goal What’s the goal of investing in this channel? Is the audience engaging on the channel one you want to reach? If the answer is yes, what do you want those followers to do as a result?

Is the goal to showcase your culture to attract more qualified talent? Is the goal to showcase thought leadership to build credibility and brand visibility to make your sales peoples’ jobs just a little bit easier?

Social media channels should have a clear focus and goal—and the goal does not have to align with the goals of your other social channels. Each channel can serve their own purpose.

Step 4: Gather a team By now, you should have already determined that the current team has the bandwidth to manage this channel. Now, the key is to find people who are passionate about the channel. They will need to become subject matter experts, and be responsible for supporting and maintaining it.

Step 5: Plan!

Create an editorial calendar for the channel. Know what you are going to share and when based on the research the team conducted. Determine exactly what you want the content you are sharing to look like, and create as much of it as you can in advance. Plan out the first month and then make adjustments from there based on channel performance.

Lay out a plan for how you’re going to introduce the channel and promote it across your other platforms, and how you are going to engage with your audience.

Set goals for the growth and engagement you’d like to see. These may change based on initial performance.

Step 6: Analyze Is it working? Are you hitting your goals you laid out initially? Are you seeing the growth and engagement you expected? If not, why? What can you tweak that may yield a large return? What pieces have performed the best, and why? Dig deep to identify what’s working and what’s not and change your strategy accordingly.

January 2018

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