DM Magazine January 2022

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Interview: Martin Kihn, Salesforce

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Spectacular Direct Mail: Creating Assets that Wow and Bond with Recipients

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Direct Mentorship Works Well Too:

The case for more and better mentorship

BY ALAN MIDDLETON

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nside marketing divisions and agencies across Canada the impact of the pandemic, aided by improvements in communications and technology, is rapidly accelerating change. Work habits and schedules, as well as organizational hierarchies and procedures are transforming.

For anyone in interactive or direct marketing and sales, what’s critical in this new ‘world’ are management practices that emphasize constant upgrading of skills — and the development of better mentorship practices at all levels of an organization.

Mentorship practices, as I have described in my book Mentorship Matters: Now More than Ever!, that engage people directly and encourage and ‘nudge’ their thought processes rather than dictate them are much more effective. While some formal processes and practices are needed, there needs to be a shift in how organizations are managed.

A similar transformation can be seen in marketing practice as mass communications — only slightly segmented messages, sent through broad media channels — started changing into more directly understood, targeted, and delivered communications.

The same trend can be seen in the delivery logistics of goods and services. Has it gone far enough in management practice? Not yet.

Many organizations and their interactive/direct marketing and sales departments, as well as marketing companies, retain structures where senior management sets rules and processes for the levels below them, and effectively discourage initiative and innovation from the very levels that deal most directly with the customer.

The Harvard Business Review defines mentorship as “the offering of advice, information or guidance by a person with useful experience, skills or expertise for another individual’s personal and professional development.”

This often happens informally but in our new world it needs to be available more formally as well. Mentorship practices have evolved: they are no longer just senior positions mentoring more junior or only within organizations.

In our industry, one of the most recognized and best developed mentorship programs is AMA Toronto’s Mentor Exchange. Established in 2009, the program has made significant contributions to advancing the value of mentorship while benefiting mentors and mentees. Progressive mentorship programs like this one, whether internal or external, show that mentorship is now a key management capability for both mentor and mentee, and any organization, large, medium, or small, that encourages its practice.

Mentors benefit from improving their management skills: listening and asking, facilitating change management, influencing, and overcoming obstacles.

They prove themselves as valuable transformative leaders by learning what it takes to develop others. Mentors gain

fresh perspectives and stay updated with new thinking and knowledge. They learn more about themselves and share their expertise with others in the organization.

They also expand their professional network and reinforce their role as subject matter experts.

Mentees benefit by gaining valuable perspectives and ideas from someone with relevant experience. When in an internal program they learn about the organization and its culture and enable contacts and networking for greater job satisfaction and promotional opportunities.

If in an external program, such as the Mentor Exchange, they add to their knowledge and perspective on the discipline and industry sector. Mentees gain perspective on their career and themselves, future challenges and opportunities, and they can learn about gender and ethnicity issues. And importantly, they gain perspective on managing others based on their mentorship experience.

Organizations that encourage informal and formal internal and external mentorship programs also benefit in numerous ways. These types of mentorship programs foster a corporate culture that encourages personal and professional growth through the sharing of information, competencies, values, and behaviours. Establishing an environment where leaders are building leaders helps the process of identification, development, and retention of talent for key managerial and professional roles.

We also know that good mentorship programs have the ability to accelerate staff diversity and inclusion, which are critical for business success. In recognition of International Mentoring Day on January 17, mentorship advocates Eli Wolff and Mary Hums wrote: “Mentoring relationships help us to broaden our lens for diversity and inclusion, allowing us to see others as people first while moving beyond labels and stereotypes.

Mentors and mentees can help each other to redefine normal and move to typical, creating visibility for individuals and communities. Through mentorship we can expand our minds, hearts, and vision toward race, sexual orientation, disability, religion, and culture. This is the power of mentoring.”

Mentorship is therefore an essential management capability because it engages people directly not just through processes and procedures. Along with formal training and prior experience, mentorship helps blend the learning from the mix of art and science so important in all forms of sales and direct and interactive marketing. Mentoring and coaching, especially in the emerging post-pandemic world, provide a critical management skill, one that matters more than ever.

ALAN MIDDLETON is an independent consultant, writer and speaker on marketing and mentorship.

A former professor of marketing at the Schulich School of Business at York University, he is a long-time mentor and the author of “Mentorship Matter: Now More Than Ever!” available on Amazon.ca.

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Spectacular Direct Mail:

TRADITIONAL DM

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Creating Assets that Wow and Bond with Recipients

BY NATE WELLS

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ometimes a counterintuitive approach to social media, email, and banner ads can yield huge ROI. My company Applied Underwriters, a global risk management company, has made a number of recent acquisitions, challenging our internal brand communications team to amplify, or integrate new brands or subsidiaries under one brand umbrella.

Thinking of traditional physical mailboxes as relatively “empty”, our team is finding great success creating innovative direct mail pieces that deliver high lead gen and brand affinity. The key to spectacular direct mail is creating pieces that both bond and resonate with targets, and have an added value beyond the piece, resulting in longer lasting and positive brand experiences.

If considering adding a direct mail campaign to your next marketing push, here are five steps to take the assets you create from ordinary to spectacular:

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1. If They Don’t Get it, You Won’t Get It Approach each direct mail piece as if the audience does not know the company, or approach as if you are talking to a new viewer or target each time. If the direct mail piece is esoteric it won’t resonate and the target won’t bond with the piece. No matter the novelty, it must be simple to understand within the context of what you do or want to do (launch a new product? raise brand awareness? enter a new market?).

During the winter/football season we created an Office Penalty Flag, playing off the idea of all the funny office infractions that happen daily. Very lighthearted, but built around the theme, “if you’re not saving money with Applied, you should be penalized…”

We also created a Football chalkboard, that folded out with an easel, where recipients could write office notes on. We created a way of printing chalk onto the chalkboard, with a customized silk screen message, “Write Your Own Winning Play.” Not only did these pieces get mindshare, they also claimed deskshare while generating a warm, positive brand experience. ❱ DMN.CA

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2. Create “Keepers” As part of an ongoing campaign, consistently touch targets with stuff they can’t or won’t throw away. Our approach is always to make a land grab for that desktop real estate. If you’ve done that, created an asset that bonds with the user and stays ever present, you’ve done your job.

We know from market research our agents really like their golf. In another example, we created a book that unfolded into a playable golf course, including a miniature club and balls. Each page featured our brand mascot — the Applied Underwriters Big Dog — representing our presence across the U.S., with an 18-hole golf course for each city.

We actually got a patent for the hinge design that made the book stay open and flat while you played. Always ask: “How can I make the user experience better?” The golf course book was absolutely spectacular, unique, and interactive, and people fell in love with it. But this piece would not be effective though if it did not include our core brand messaging.

3. Build Value Beyond the Piece As great as the direct mail piece may be, for the piece to “take on a life of its own” the campaign cannot end at the physical direct mail piece. It must be supported with a promotional website, social media and even possibly a “thing within a thing”. We created a direct mail piece for our annual Harvest promotion, built around a wine coaster set of five, beautifully illustrated by well-known scratchboard artist Steven Noble (market research also tells us agents really like their wine!)

Each coaster has a QR code that when scanned, takes the visitor on a 360 VR stroll (highlighted by the illustration now coming to life) through a Napa Valley vineyard. This kind of detailing really bonds the piece with the recipient. Moreover, she may use these coasters to augment the experience of sharing wine with friends and family at home, and as such, this DM piece creates an intrinsic “personal value” beyond the promotional aspects.

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4. Know Your Audience, Don’t Cast a Too Wide a Net Know your audience and don’t cast too wide a net or you could waste big bucks fast. We know a lot about the 36,000 or so agents and brokers across the U.S that we target, and we know that they’re interested in insurance. We can do clever things and take chances with spectacular DM and know it won’t fall on deaf ears. The key with any direct mail piece is to appeal to your viewer/ target. Do your market research before you commit to producing the piece.

As mentioned above, we know in the workers’ compensation industry, agents like their seasonal favorites like wine and golf. We also know this is a small and finite audience that appreciates brands they perceive as clever. Would taking out banner ads be a better use of funds or work another time? Possibly, but for this audience we know that cementing a reputation as a perceived “clever” brand that knows its audience is the best way to generate the feedback we seek.

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5. Feedback Beyond the Piece Engaging customers about their thoughts on the DM piece is a great way to get a dialogue started.

All direct mail pieces should be considered as a first touch point to eventually increase the engagement of the recipient/viewer. This is not a strategy like sending a postcard and saying, “Hey, we are open for business.”

Instead, the direct mail piece provides an excellent feedback mechanism that can also be tracked via Salesforce and other programs. Ask your customers, did it work? Did they see it?

Did they share it? Ultimately the goal of direct mail is not necessarily to drive sales but to effectively build brand awareness and interact with the customer.

NATE WELLS is Vice President Global Communications, Applied Underwriters.

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KICKER INTERVIEW

The Connected Omn

An Interview with Martin Kihn, SVP Strategy, Marketing Cloud, Salesforce

BY STEVE SHAW

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STEPHEN SHAW is the Chief Strategy Officer of Kenna, a marketing solutions provider specializing in delivering a more unified customer experience. Stephen can be reached via e-mail at sshaw@kenna.ca

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here is a tug-of-war going on in the marketing world these days between two opposing schools of thought. On one side are creatively minded brand marketers, who remain convinced that the only sure way to achieve long-lasting market growth is to build brands. On the other side, just as adamant, are data-driven performance marketers, preoccupied with converting clicks into sales.

The tension between these two tribes has escalated in recent years with the massive shift of media dollars from traditional broad-reach channels to digital advertising, much of that soaked up by Facebook, Google and Amazon.

At stake is a larger claim to the marketing budget.

And while brand marketers insist that brand recognition and preference drives purchase behavior, the performance marketers argue that search intent trumps brand awareness. Google describes this as the Zero Moment of Truth (ZMOT), when in the buying

process the connected consumer researches a product prior to purchase.

For now, the performance marketers have the upper hand. It is a lot easier to prove marketing ROI through last touch attribution than to give credit to squishy measures like brand devotion. In this Age of Distraction, when attention span is so fleeting, people tend to skip, ignore or scroll past the ads, or worse, install ad blockers. And that means it is harder than ever for brands to win consideration early in the decision cycle.

With the imminent demise of third-party cookies, programmatic advertising will be dealt a fatal blow.

Brands will begin to covet first-party data collected through owned media and use that intelligence to drive more engaging experiences with customers.

Brand marketers will have a new role to play: finding creative ways to engage in a deeper dialogue with customers, using content as the conversation starter.

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KICKER

And performance marketers will worry less about generating fly-by traffic and more about the continuity of digital engagement. In short, every marketer will become a “full funnel marketer”, organizing themselves around the customer journey.

Martin Kihn calls this omnichannel framework the “know, personalize, engage” (KPE) model. Marketing must shift from a campaign orientation, he believes, to a real-time mindset where the goal is to deliver more dynamic experiences that build upon each other over time. To offer that type of rich, adaptive, contextual experience demands, of course, a single view of the customer, and a next-generation, zero-latency engagement platform that can fire like a neural synapse the moment someone interacts with the brand.

An accomplished author, Martin started out as a writer on an award-winning MTV show called “Pop-Up Video”, and then made a sudden pivot to the world of management consulting. That experience led to a JANUARY 2022

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Martin Kihn, SVP Strategy, Marketing Cloud, Salesforce

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nichannel Experience

best-selling memoir called “House of Lies” and later a hit TV series.

Stephen Shaw: When you were going through that baptism of fire during your time as a consultant, did you have any regrets about switching careers?

Martin Kihn: Well, not really. It was a mercenary choice. “Pop-Up Video” had got some popular attention, which was very nice. It was a lot of fun. And as a writer, I probably couldn’t get a better job than that. But I was getting paid $1,000 a week, and only when I worked. So, between seasons, I was laid off, and then I went on unemployment, which was not $1,000 a week. So, my net take-home was something like

Co-written by Martin Kihn and colleague Christopher O'Hara of Salesforce, Customer Data Platforms delves into these concepts in more depth.

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CDPs are the hottest marketing technology around today, but are they worthy of the hype? Customer Data Platforms takes a deep dive into everything CDP so you can learn how to steer your firm toward the future of personalization.

CONTINUED ON page 12 DMN.CA ❰

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INTERVIEW CONTINUED FROM page 9

$50,000. And this was the late ’90s and that was not a lot of money.

And I thought, “I will never own an apartment.” That was literally the thought that went through my head if I continue in this career.

So, I decided that I’m just going to go to business school. And I ended up liking it more than I thought.

I actually enjoyed learning about corporate finance. I thought I was learning about America, the way America works, you know, capitalism. And then I got a job at a consulting firm right out of business school and my salary doubled. But then the job ended up being very difficult, very stressful, and much harder than my previous work. But I was getting paid more and there was a career path. So, I didn’t actually regret it. I did know pretty early on I wasn’t going be a consultant forever. That’s true.

Shaw: At what point along the way did you decide, “This would make a good memoir?”

Kihn: Well, I tell people I went to business school so I could just quit writing. And ironically, that’s when my writing career started to take off because I had something to write about. As a consultant, you go on-site with clients. So, I went to various cities. These are not glamorous cities. These were wherever the client might be.

And we would go and sit in their offices, and they would give us a conference room or something, a cubicle. And I would notice that the consultants didn’t necessarily have a background in the industry, but they would use language in a way that made them sound like they were experts. So, the good partners could sound like they knew everything about everything because they dazzled people with the way they used language. So, I thought, “I’m going to write a dictionary. It’ll be the “Consulting to English” dictionary.” And that’s how it started. And it’s actually in the back of the book. There is a dictionary there. And then it just turned into a memoir.

Shaw: You left consulting to join the digital agency Digitas. Was the switch over to the agency world a welcome reprieve from the consulting grind?

Kihn: I felt so much more at home. ❱ DMN.CA

“You’re either nailing it and winning huge clients or you’re on the way down and firing half your staff.”

It’s still my favourite type of place to work. It has creatives, with the British guys and their little glasses and the facial hair and the wry smirk. And then also very smart people doing SAS models, and then also the smarmy sales guys. There’s lots of stress because advertising is really all or nothing. I mean, you’re either nailing it and winning huge clients or you're on the way down and firing half your staff. It’s this roller coaster. So, emotionally, it was maybe a bit too fraught for me, but I liked the atmosphere and the people because they’re very lean and very efficient. And then my wife spouse-napped me and convinced me that we should move to Minnesota where she’s from. I went to work for a creative agency in Minneapolis called Fallon, very well-known at the time, a creative hot shop. I was the analytics team. It was basically me. I did measurement for this TV agency. And it was pretty cool, actually. But then I joined Gartner which was just starting a group called “Gartner for Marketing Leaders”. Gartner recognized that marketing was becoming more technical. CMOs were asking about applications, databases, and measurement. And so the whole profession of marketing had become more aligned with the core Gartner value prop, which is CIO research. So the Gartner fit was good because I’m good at research, I’m good at explaining things and I’m good at public speaking.

Shaw: Your time at Gartner was spent during the glory years of programmatic advertising.

But now we’re on the verge of a “cookieless” world. Do advertisers go back to oldschool audience targeting, or is Google’s concept of a “federated learning of cohorts” going to become a practical alternative to the walled gardens?

Kihn: Well, there’s no going back. The tech has advanced, and everything is just much farther along than it was in 2010 when RTB [real-time bidding] started to become a thing. There will continue to be user-level IDs. There’ll be opt-in. The trade desk solution will probably continue to exist in some form or other. And all of this assumes that consent has been gathered and stored. First-party data will be used for media. You can already do it with Facebook Custom Audience. The New York Times is already talking quite a bit about first-party database audiences. And then the other thing is FLoC1. There are others – TURTLEDOVE and SWAN. And then I think they ran out of bird acronyms. The idea of some kind of machine learning-generated cohort is perfectly valid. Those will exist, I think there’s no doubt about it, at least in Chrome.

Shaw: And what about Salesforce’s DMP? Are you going to fold DMP functionality into your CDP?

Kihn: The DMP won’t be required in a cookieless world, but that doesn’t mean that elements of DMP won’t continue to be useful.

Salesforce has a DMP called Audience Studio, which used to be Krux. Krux was acquired in 2016 back in the boom years of DMPs. We’re hoping to keep this product going as long as people want to use it. But when we talk about how digital ad campaigns will be done in future, I think first-party audiences will form the core. And then there will be lots of other ways to do media without any kind of data, based on contextual information. And this will be better than it used to be, because machines are smarter.

Shaw: You crossed over from the martech beat at Gartner to leading martech strategy at Salesforce. Is your role at Salesforce to be the chief storyteller? Or is your role to help align the product roadmap with where marketing is going?

Kihn: Both. My role has shifted.

When I first started, I was very focused on CDPs because at the time — this was 2018 — customer data platforms were zooming up the hype cycle. The number one question from our customers at Gartner was, “What is a CDP?”.

Advertiser Perceptions did a survey at the time asking marketers what CDP they were using. And something like 60 percent of the respondents said they were using Salesforce CDP. But at the time we didn’t have one. And number two and three were Adobe and Oracle.

Oracle had talked about launching one. Adobe didn’t have one either.

We would have to either build one or acquire some new capabilities.

So we decided to just build it ourselves.

Shaw: Going forward, how does Salesforce maintain its pole position? It’s a pretty fierce arms race.

Kihn: Yeah, it’s tough. It’s competitive. The big competitor in our space is Adobe, but there’s lots of others. Our marketing cloud has been built up over the years through a series of acquisitions that have been integrated more or less over time. Our CDP was built on the same codebase. And that’s the secret I think, where literally JANUARY 2022

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INTERVIEW anyone can build an application on top of this set of tools which take data in and out from the CDP. So our CDP functions as a repository to organize customer information.

This whole “platformarization” is in service of a larger narrative that Marc Benioff [Salesforce CEO] is pushing, which he calls business transformation. What he means by that is that the different parts of the organization can work together better if they're all using the same unified profile. A “single view of the customer”.

Shaw: Does the CDP become the linchpin for what you call the connected omnichannel experience?

Kihn: In the late 1990s marketing automation was all about crosschannel orchestration — email, direct mail, the website. The difference now is that there are so many more channels and such a greater requirement for really rapid decision making and orchestration.

So, you need a different architecture, obviously. The CDP should be available to anyone in the organization who needs to deal with customers. That includes the service team, obviously, sales, for sure. More broadly, anyone in customer experience or research.

So, it’s got a lot of applications outside of marketing.

Shaw: Does the CDP occupy the center of a galaxy of orbiting platforms that serve different customerfacing functions within the enterprise — marketing, sales, service, eCommerce — or does the enterprise architecture reconfigure around the customer experience, eliminating the silos?

Kihn: It’s the latter. That’s the goal.

And it is a journey, though. It’s a multi-year journey. It’s a journey for all of us. And by that, I mean, I don’t know any customer who has reconfigured completely but many of them are doing really well.

Shaw: You state in your book, quite clearly, that CDPs will become the single source of truth for customer data. Who should own it — marketing or IT? Kihn: I think the tension between IT and marketing is one that’s getting worked out in real-time.

JANUARY 2022

And it differs by organization, but in general, I think that there’s more appreciation now for the difficulty of the task at hand and the resources and time and expertise that are required to do something like maintain a single view of the customer in-house.

I get asked every week, “Can we just do this ourselves, just use open source and get our data science team on this one?” And the answer is, “Yes, of course, you can.” You can do almost anything yourself if you have enough people and you have enough time and you have the right kind of talent and you’re willing to invest in it.

But what Salesforce is offering is outsourcing that headache. For instance, Facebook changes their API 90 times a year. Do you really want to have somebody on your team dedicated to monitoring Facebook’s API so that you can reconfigure it every time it changes so that your social advertising doesn’t break down? That doesn’t mean you don’t still have control over things like master data management. CDP doesn’t replace MDM. It also doesn’t replace the enterprise data warehouse or the data lake.

Shaw: Gartner has predicted that 80 percent of companies pursuing a 360-degree view of the customer will abandon those efforts because it’s hard to do, as you just pointed out. Will they really wave the white flag?

Kihn: I know that research you’re referring to. In fact, that prediction was made by a good friend of mine. But their point is more nuanced than it sounds.

What they’re actually saying is that if you define “single view of the customer” as a complete view of your customer containing every single data point — where you’re trying to create a truly golden record, absolutely accurate and persistent and exhaustive — then that is probably a waste of time.

And I have to say I completely agree with that. That's not really what a CDP is supposed to be. It’s not supposed to be a data dump.

It’s supposed to be something different.

Shaw: What becomes marketing’s mandate in this data-driven, experience-driven world that we're moving toward?

Kihn: Professional marketing has changed quite a bit since I was in business school 20 years ago. It was not a statistical profession.

The thing now is, it’s all about who in the organization knows the customer. Who can take the outside-in view? When I was at Digitas, we were designing, in a sense, artificial journeys for artificial people. Today marketing is supposed to be the one who understands the customer best.

Take Delta Airlines. They look at the end-to-end experience for their high-end business travelers, all of

“The difference now is that there are so many more channels and greater requirements... for rapid decisionmaking.”

the different digital touchpoints, not just the look and feel, but what information is provided?

When is it available? There’s a lot of complexity in that journey, but they’re trying to make sure it’s all connected and coherent and that it delivers what people are expecting and then just a little bit more. And in order to do that across channels, they need to join the kiosk with the mobile app, with the website in real-time. If I change something on the kiosk, I expect it to be reflected in the app right away.

Shaw: My observation is that marketing is mainly driven by performance marketing goals, that their job is to go after the next sale, not create new value for customers or, indeed, have an influence on the business model of an organization.

Kihn:Your point is a good one.

Certainly, the KPIs might be wrong, but I think the good marketing organizations have been trying to move away from the performance driven approach. If you’re too focused on performance, the customer experience suffers.

Every customer I can think of has thought about that, what you just said, the implications of being focused on the wrong metrics.

But many have a long way to go.

And I can also say, there are good organizations out there where marketing is just communications and somebody else owns the voice of the customer. There’s not a single one-size-fits-all answer.

Shaw: Most of the martech vendors are usually too busy trying to satisfy the most pressing needs of marketers instead of convincing them of new ways of doing things. Yet Salesforce is providing thought leadership for the industry.

Brian Solis, Mathew Sweezey, yourself — that’s a pretty impressive roster of thought leaders. Is Salesforce trying to be a change agent?

Kihn: We definitely are. The tension is always between what’s available today versus tomorrow and getting people to adopt tools they already have. For example, we’ve productized AI and machine learning, what we call Einstein features, which is another, gentler way of surfacing new ideas.

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INTERVIEW Shaw: The other challenge, of course, is creativity versus analytics. How do you eliminate the functional division between brand and performance marketing and bring together a collective pool of multi-disciplinary people organized around the customer who can think creatively and analytically?

Kihn: Generally speaking, the Centre of Excellence model works, and I think agile workflow is good because you bring together people who have different skills and form

teams and then un-form them like a movie crew.

Shaw: The Hollywood model.

Kihn: The Hollywood model. I think that seems to work.

Shaw: Amongst the many challenges that marketers have today — data, obviously, being one of them — complexity is the other one. Do we need to groom a new generation of “T-shaped marketers” who are completely at ease with technology, data and creativity?

Kihn: I think that computer science is now the number one major when it used to be English.

But I think that creative is going to become more important over time.

It’s the one area where a company can differentiate itself by talking to customers in a more human way.

And it’s also something that people will probably always do better than machines other than coming up with the right sale price — machines will probably be better at that. But coming up with a way to communicate with other people that can move them is the realm of

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creative. And so I like the idea of a T-shaped marketer. People know data is important. I think we need to tell them that creative is equally important.

Shaw: Ultimately AI may be the answer to the complexity challenge. It will allow very complex communication programs to happen in real-time working off a wellstructured CDP. Kihn: Yeah. Ten years ago, you had to have an exact match between the Cust ID, Identity A and Identity B. It had to be the same email, same name. Then we could do fuzzy matching. And now through AI, you can do some very complex matching without a lot of code and initial setup. The software itself is getting smarter. It’s supposedly making our jobs easier. The issue is that we need to understand how it works so that we can guard against things like bias or inaccuracy.

Shaw: Just put your futurist hat on, five years from now, where are we? We’ve had five, six years of tremendous progress in technology. Where is the next wave of technology taking us?

Kihn: I think consumers will be more open than we are now and less paranoid about marketing, targeted advertising, marketing messaging. We’ll see more of the value in it because it’ll be better and more relevant. The steps we have to go through now are just ridiculous. But the machines will be much more nuanced and sensitive to that kind of thing.

Marketing will morph into the customer experience crew.

Shaw: So, is there a new memoir in the works based on your experience of the past few years?

Kihn: Of course, yeah. I also am very interested in cats. I wrote a book about my dog. So, if I can combine cats and marketing — I think there’s something there because cats really do rule the internet. So, I’m working on that.

Shaw: Cats and dogs. Like IT and marketers in the past, cats and dogs.

Kihn: They can co-exist.

JANUARY 2022

// 15

COURTESY DANAVATION TECHNOLOGIES CORP

TECHNOLOGY

The Next Marketing Analytics Tool — Smart Labels

T

oday’s shoppers are tech-savvy and informed.

They read and write online reviews, search for the best deals online, and have invented the practice of “showrooming” — visiting a store to check out a product in person before buying it online at a lower price. When shopping, they consider factors like where a product was sourced, its ingredients or components, and whether the product has harmful environmental effects. They want to know if a product is fair-trade, gluten-free, or locally sourced. If they’re not shopping online, they have their smartphone in hand.

And whether they’re shopping on their laptop or at a brickand-mortar store, today’s buyers expect shopping to be seamless, convenient, and highly engaging.

“We’re seeing the evolution of shoppers and the evolution of social conscience,” says John Ricci, founder and CEO of Danavation Technologies Corp, a Canadian company leading John Ricci, founder and CEO of Danavation the way in Technologies Corp digital retail.

“Nowadays, people need a lot more information to make an educated JANUARY 2022

purchase.” Ricci’s firm is working to expand the application and acceptance of labels as a source of real-time information which benefits customers and retailers in a way that builds a richer experience and provides more accurate data.

Homegrown innovation Ricci is a retail vet with more than 30 years of experience in the industry. He noticed that the retail environment seemed to be missing something, a solution that met and exceeded the needs of modern businesses and techsavvy consumers. Determined to revolutionize the retail segment and to bring retailers into the digital age, in 2018 Ricci launched Danavation’s signature system called Digital Smart Labels.

The relatively straightforward but powerful solution are micro e-paper displays that enable diverse organizations — not just retailers and grocers but pharmacies, pet stores, animal shelters, distribution warehouses and many others — to automate their labelling, pricing, product information data and promotions in real time. They are easier to read and more energy-efficient than LCD displays and reflect light like paper to offer high resolution

Digital platforms mean updates are instant and can adapt to location.

and contrast, easy visibility, and vibrant colour displays that can be read even in direct sunlight.

The state-of-the-art technology is driven by cutting-edge IoT automation technology and proprietary software developed by Danavation.

“We’re the only electronic shelf label provider that’s founded and grounded in North America,” says Ricci. “We design and engineer all of our hardware and software right here in Canada. In the tech world, this means less concern about privacy and security as there are no servers outside of the country and far less risk of security breaches.

We represent a safer environment to do business. We like to think of it as one thing that no one else can,

and that’s home-field advantage.”

This homegrown approach also allows more effective customer service, on-site technical support, and 24/7 availability.

Celebrating operational efficiencies Central to the idea is to connect shoppers with the latest, most relevant product information so that they can make more informed in-store decisions, while providing the retailer with faster reaction times and the opportunity to optimize operations. This includes engaging consumers at the shelf, which increases basket size, Ricci suggests.

“We preach three wins: operational efficiency, consumerDMN.CA ❰

COURTESY DANAVATION TECHNOLOGIES CORP

BY TANIA AMARDEIL

engaging features, and revenue generation,” says Ricci.

Operational efficiencies are a given, starting with the reduction of paper. Electronic labels help establishments lower their carbon footprint and boost sustainability.

They also reduce labour costs and free up employee time, so staff can focus on product education and offering valuable customer service — more high-impact tasks than switching out labels manually.

“Customers’ number one pet peeve is that you can’t find a salesperson anymore,” says Ricci.

“Employees should be free to walk around the store, asking customers if they can help them with something.”

Danavation’s labels also sync with retailers’ ERP and POS systems, offering unprecendented speed and accuracy and vastly improving in-store efficiency and productivity.

Reimagining the shopping experience “The next win, engaging consumers, is critical for the success of a

Data-driven insights and analytics concentrate on consumer buying habits.

business,” says Ricci.

Although today’s consumers are increasingly shopping online, brick-and-mortar retail stores will always have a distinctive appeal and cachet. Nothing compares to feeling the weight and texture of a sweater, selecting your own perfectly ripe tomato, or enjoying a personalized experience thanks to the help of a friendly and knowledgeable sales associate.

Shopping in person also guarantees that you’ll get exactly what you

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COURTESY DANAVATION TECHNOLOGIES CORP

// 16

TECHNOLOGY

want, when you want it — without the shipping delays, fees, and order mix-ups of online shopping.

Still, today’s retailers know that they need to go the extra mile to engage and excite customers who enter their stores. Shopping has become more of a destination and an experience, and engaging customers is essential — both to give them a memorable, five-star experience and to increase cart sizes, maximizing profits for retailers.

Smart revenue generation “Businesses are opening their doors and they want to sell more products,” says Ricci. “They don’t want customers to just walk around and look, and then go home and make the purchase at their kitchen table. If you really want customers to make the purchase in the store, you have to catch them while they’re there.”

The team at Danavation is hard at work developing various software features that will soon be available to retailers to help them engage their customers at the shelf level to encourage purchases and increase order size. From the recently-launched Digital Smart Blade (a largerformat Digital Smart Label that extends perpendicularly from shelves, offering consumers relevant promos in real time while increasing revenue for retailers, who can rent out the ad space to brands) to augmented reality and QR codes embedded into the labels that give consumers more info about a product (for example, a winery tour for a bottle of wine for sale at the LCBO), Danavation’s innovations facilitate an enhanced shopping experience.

Propelling data-driven marketing “All retailers are looking for that secret sauce — how do we get into our customers’ heads, how can we get them to buy more, how can we make the buying experience a lot more personal than it has been,” says Ricci. You know how when you search for a new car or pair of shoes on your phone, you suddenly start seeing ads for the same product?

That’s what retailers should be doing, too, says Ricci.

The advanced engineering behind Danavation’s digital e-paper displays, cloud architecture, software, and, in the near future, data-as-a-service intelligence tools will equip retailers with valuable insights into consumers’ buying habits. Coupled with parameters such as inventory levels, cost of goods sold, sales velocity, competitor offers, weather conditions, current events, and demand/price-sensitivity, the firm’s innovative leveraging of AI, big data, and machine learning will allow retailers to automate pricing at the shelf, optimize their product mix, and forecast inventory.

Ultimately, the data-driven insights and analytics will be focused on understanding customer buying habits and using that knowledge to better respond to customer demands.

Giving shoppers the right products, at the right time, at the right shelf — along with a captivating, personalized, digitalforward experience — is the way to bring retail into the digital age and to effectively serve and engage today’s savvy shoppers.

TANIA AMARDEIL is a Toronto-based freelance writer.

JANUARY 2022

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OPERATIONS

Post-holiday returns are coming. How can retailers turn this into an opportunity?

BY DAN SURTEES

T

he 2021 holiday shopping season has come and gone. Yet the aftermath is upon us — the inevitable wave of returns.

The past two years have seen an historical increase in online shopping. eCommerce sales have risen by 44 percent since 2019 ­ which has resulted in a higher rate of return than in-store purchases (20 percent vs. 8-10 percent).

Retailers could now be set to tackle the largest wave of returns ever.

While the process of managing returns is typically seen as having a negative impact on operations — consumers don’t usually view them as a “fun” transaction — retailers have an opportunity to turn it into a creative way to further drive customer loyalty.

An opportunity for an offer Retailers are constantly looking for ways to increase foot traffic to their stores. Offering promotions specifically tied to in-store returns becomes all the more important when you take into account the many alternative avenues consumers have for returning products in today’s retail environment.

Rising levels of digitization, which only accelerated during the pandemic, mean consumers have more options than ever to return products — online, through curbside drop-offs, or couriers. As a result, retailers are ❱ DMN.CA

losing potential opportunities to make a sale or offer customized promotions in-store to further drive customer loyalty.

XCCommerce’s research confirms that today’s customers are looking for promotions and loyalty programs. When done right, these promotions create the positive customer experience every retailer strives for and can have an enormous impact on the image of their brand.

According to our research, 72 percent of consumers stated a desire for more promotions — a top factor when making a purchasing decision. Sixty-nine per cent (69 percent) said discounts are the main reason they shop at a certain retailer and 56 percent stated discounts are the most important factor when considering where to shop.

Not only will promotions attract a consumer to your store. Our research also shows that promotions are very likely to keep those consumers around as loyal shoppers to your brand — 62 percent of those surveyed said they are loyal to retailers who offer promotions.

Beyond the discount Many retailers offer promotions such as discounts, loyalty point multipliers or free shipping . But in today’s retail landscape retailers need to get creative if they want to attract the modern consumer.

Leveraging VIP rewards to offer

exclusive invitations to events or early access to new items before the general public, for example, will make customers feel like more than just a sales number. It creates a connection between the brand and the consumer that all retailers strive for.

Today’s consumers are looking for brands that align with their own, personal values. Retailers that can guarantee ethical practices — including ethical trading, manufacturing, and shipping practices — are more likely to be held in greater esteem compared to those that do not.

Tying a promotion to your business’s ethics or corporate social responsibility program, such as offering charitable donations in the name of the consumer as part of a purchase or return, can help establish a great connection with that customer, and build your brand image.

Easy and painless There is more to consider than just promotions during the returns process. The entire experience must be easy and painless — particularly given the ease in returning goods online. If there is too much friction, customers are less likely to return to your store; no matter how great the promotional reward.

In many cases, the management and operational challenge to achieve a seamless experience that ties in sophisticated promotions

can be daunting. Today’s complex promotion execution and management solutions can help meet this challenge.

By more easily offering a large range of promotions through the variety of channels customers engage with, retailers can be empowered to create a seamless returns and promotion offer experience that today’s modern consumer expects in the modern retail landscape.

Business stakeholders must work together to create promotions that are meaningful to their customers and encourage them to return to stores. And the staff in store must be aware of what promotional tools they have and be able to upsell and cross sell the rewards and benefits.

In this ever complex world of retail, the business must be able to react quickly, managing and modifying promotions, in the light of everchanging market conditions, sales volumes and customer responses.

DAN SURTEES is Vice President of Strategy and Business Development for XCCommerce.

XCCommerce is the industry leader in promotion management and execution, helping the world’s foremost brands drive growth and customer loyalty. For 20 years, XCCommerce has delivered retailers an Omni-Channel customer experience, with the power and speed to manage, execute and analyze complex promotional offerings, across all sales channels.

To learn more about XCCommerce and how they are delivering retail promotional excellence for the industry’s leading brands during this holiday shopping season, visit https://xccommerce.com

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