customer experience; ecommerce, social media marketing

5 Things Ecommerce can learn from Retail – part 1

 Educate your customer

4612732045_e1e6061b69_zCustomer education plays a central role in the ultimate sales strategy. With educating your customer you offer them help. You also express you care about them making a wise decision for their particular situation. That makes education a powerful instrument for getting customers to connect to you before their transaction.

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What’s more, it is also an essential strategy to maintain the relation with your customer after the purchase. This can greatly influence your success in turning a one-off-sale into a returning customer. Check out The Ultimate Sales Machine by Chet Holmes. Chet Holmes gives many creative examples how education of customers caused sales to boom.

E-commerce can learn from retail in this field. E-commerce is generally very good at providing specifications. Automated interfaces of product specifications provided by wholesale or manufacturer make this very easy. The challenge for E-commerce is to shift its focus to the meaning and impact of specification in order to fulfil the need of each individual customer. Is e-commerce capable to provide more then just the product? If not, harsh price competition will be the result.P1070688-3

What do you think?

Thanks to Ralph Daily and Flickre.com for the photo.

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customer experience; ecommerce, social media marketing

How to create engagement with social media? 5 Things you need to know.

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Compare the two situations above. In what situation would you feel tempted to ask a question or make a comment?  These pictures tell you at one glance why it is difficult to create engagement with social media. Research by Forrester  shows that interaction with followers is indeed low and even declining, regardsless all investments.

Last year, Instagram posts from brands created interactions with 4.2% of a brand’s followers. This year, that fell to 2.2%. On Pinterest, interactions fell from 0.1% to 0.04%.

Facebook, however, experienced an increase in brand engagement – 0.07% up to 0.2%.

What the pictures tell instantly is that most of us need a human size to be able to act. Let’s dive deeper into this topic to understand why social media are ineffective to create the engagement. I am convinced that customers want to connect and engage with us. They just want it done differently. What needs to change in our social media approach?

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1. Social media is not social

The common denominator in the social media is that they are publication platforms. You push your message into the world. The intention is not to get an answer, the intention is to get your message forwarded. I once did a class in Stand Up Comedian acting. Twitter and the other media remind me of this: you hear something 3264262523_33d140c50f_mand you immediately pass it on. You have no purpose, no expectation about what the next person will do with your text. The game is that someone extends the string with a new comment. If no one does the string breaks and you start a new one. It’s good fun.

Facebook is at this moment still the most dominant Social Network. The mission that made Facebook big is that it facilitated you to share personal things with friends at college. Research reveals that nowadays sharing personal things is the biggest threat felt by Facebook users (35%).  Only 10% updates their personal status on Facebook regularly. Most Facebook users stick to liking and forwarding messages. The best liked feature of Facebook nowadays is “Seeing photo’s and videos”. Only 16% of the Facebook users actually likes Facebook for getting feedback.

Customers want more. Customers have a mission. They intent to buy a complex product or service and have questions that need an answer. To facilitate customers in this, communication should become a dialog. Question and answer. Like a circle instead of a line. And once a customer is participant in a dialog, he will want to remain included till he has made his purchase.

2. Social media is an art

Social media have become important in marketing because they can make a message go viral. Reach is of key importance for social media marketing. Without reach, your publication was useless. How do you achieve reach?

10951906866_d52d2f911d_mSensation and entertainment have to be key elements for a message to go viral. It’s a joy to see how some people really know how to bring a message. Social media created a new type of artists. We have seen numerous examples. Limiting myself  to mention one I would like to highlight Bethany Mota. Her video blog is a good example that shows how the right performance can trigger success. It is a good example how to move from sharing content to creating an experience.

Now position yourself as customer. What is the meaning of social media if you are a normal person? What if you are only modestly funny and sensational, and you have a question you want answered? For customers social media is not a specialization, but just a means. Due to the enormous stream of messages their message will be overlooked. The number of followers does not necessarily mean much. Each message has to compete with the overwhelming stream that everyone receives daily. What are social media for you, when your message drops dead fast?

From the customer perspective reach is not important. What counts is to get information on demand.  People don’t want to have to step onto a podium to try to reach hundreds or maybe millions of people. They rather are facilitated with a small comfortable group of relevant peers. In small groups one will be heard when asking a question. When someone responds a dialog starts. The question can be asked without much presentation skills, though it will always be to your advantage when one can bring a message well.

We have done some tests on this. Our test consumers reported that the optimal size of a group is 5 to 10 people. This is not a surprise. A social psychology research demonstrated long ago that when there are many people overseeing an assault, no one will act. People remain inactive because everyone thinks someone else is in a better position to act. When people know there are only a few others, people feel addressed and respond.

Social media should thus facilitate that customers are aware that they are part of a small group of relevant peers. This will make them feel free to communicate their question or comment. This will also ensure that they will feel addressed by a question of another customer.

3. Facebook marketing is like bowling

Many companies are active with social media marketing, because social media are used as an entry portal for web shops. Facebook alone drive 22% of all website visits, Pintrest drives 5%, Twitter less than 1 %. The 1% of Twitter is still more the other social media like YouTube, LinkedIn, Google+ etcetera together (source =  E-Consultancy). Social media are thus important in generating traffic to your shop. These figures are averages. Question is of course how these percentages are for your line of business. Especially simple and more emotion driven products will be successful on Facebook.
19331649063_e965086156_mThe impact of Facebook will stop the moment people get to your site, due to the platform switch. It’s like bowling. Once the ball is thrown, you can only watch it go. What you want is a social platform inside your shop. You want to be in control of the ball during the whole process.

We like to provoke you a little. Your Social Media Investments are totally inefficient. Based on the above data, 70% of traffic comes from other sources and is thus not impacted by your Social Media activity. But there is more. The data provided by the extensive analysis of SeeWhy of behavior of 600.000 customers, shows that only 4.3 % of shopping card traffic comes from Social Media sources. Social traffic is less inclined to buy something. But it’s gets even worse. They measured that social media traffic only counted for 2.11% of the total sales. So Social media is important in generating traffic (30%), but the share in sales is marginal.

What ecommerce needs is a platform that facilitates  shops to communicate with their customers during the orientation phase, the selection phase and during the closing.

4. Listening is gold

2706701983_dc3d66fb8a_mEngaging customers requires that they have the feeling they can contribute and that you will listen to them. Ecommerce is – in general – afraid for open customer feedback. “You never know what someone is going to say.” This attitude is not very productive nowadays. When they don’t tell you, they will most likely put the message on Twitter or another social medium.

Vocificate your site, meaning get the Voice of the Customer inside your shop. It’s a new term I invented to make clear that if you want engagement from your customers, your site needs to be theirs a little as well. You need to allow impact. You can consider that a threat or an opportunity. Knowing what your customer wants, gives you the opportunity to offer them exactly the right deal or service. The new ecommerce will need to dare to be open to customer feedback.

Getting engagement from your customer requires more. You need to be unique. You need to become an identity, otherwise there is nothing for them to engage with. When you have the social medium integrated in your site, this means it is centred around your shop. Such a social medium I like to call a Social Media At your Service (SMAS). Such a platform ensures that it is available in your shop only, so it creates an unique relation with your customers. What you give them, they can’t get anywhere else.

Add to this the strategy that you allow your employees to communicate freely and personally. Your site becomes human. This will strengthen the connection customers will feel towards your ecommerce shop. In this respect, ecommerce can learn a lot from retail.

5. Relevance

6090651389_71e6829503_mSocial media easily turn into a overwhelming stream of data. Information overload has become a general problem. When there is too much to read, you randomly pick some eye-catching messages. Facebook centres data around you and your ‘friends’. Twitter has the followers concept, next to the # for topics. Both platforms push ads. Any of these streams is too much to follow on its own, and most people participate in several platforms. They will miss a great deal of the messages. We have accepted that as normal. .

What is relevant to your customer? I think it is safe to assume the customer finds information related to his current activity very relevant. He wants information about mobile phones when he is looking for a mobile phone. Not when he is reading news or looking for a new fishing angle. Data clearly demonstrates this. For some time people have developed a blind eye for advertisement. Nowaday people even take action to avoid ads. This clearly is the consequence of the information overload that social media have brought us.

Next question is who are relevant to your customer? The current customer distrusts authority. Customers want to be in contact with other customers. Naturally that should be people who are investigating the same type of product or who have recently bought one. The information these people have and their opinion is relevant. The information you as shop share is relevant as long as it is considered open information. When you communicate on an open platform, your message becomes trustworthy.

Their is a second argument that makes communication in an open platform valuable for a shop. A message that is relevant to one customer, will most likely be relevant to the others in this group. This relates to Jay Baer’s Youtility concept. Your message needs to be truly helpful to get attention. Customers inside your shop are in need of information about your products and you probably have the information they need available. If you organise this will, you can have great impact for your customers.

You can help your customer to achieve a well based decision faster.

Conclusions

We started this blog with the statement “we need to change our social media approach”.  In this blog we have highlighted 5 important reasons why social media fail to create engagement with customers. To summarize this:

What is needed is a MICRO social medium.

You could argue that such a micro social medium misses the functionality to attract customers, because it is only available to customers who have already found your shop. That is however not true. The unique content will boost your SEO value as Google attributes high values to unique content that answers a customer question. We will address this topic in another blog article.

I am not arguing Facebook presence. It is important to attract traffic. Our position is that with a additional in-shop medium you can get much more result from it. Let’s position social media marketing in perspective though. Traffic of people that already know you (direct traffic and email traffic) are 90 % of the conversion. Social Media traffic is good for only 2 % of conversion. Where do you want to invest your next budget?

Facebook and Twitter happened to you. A micro social medium in your shop puts you in the driving seat. It’s your shop and you will turn it into a living community.

What do you think?

When you like the blog, you can do me a great favor by sharing it.

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With thanks to Flickr.com for all photo’s.

customer experience; ecommerce, real-time marketing, responsive marketing, social media marketing

The Marketing Vulcano erupts. Move, move move !

Vulcano

A marketing vulcano? You probably ask yourself: “what on earth would that be”? Sounds threatening. On the otherhand, we also know that vulcano’s leave fertile lava soil behind. The eruption thus creates a new future.

The growth of vulcano’s is something that facinates me. I can’t get my head around the earth being filled with magma and big tectonic plates shifting slowly, a couple of centimetres per year. When they move from each other, they leave a hole where the magma slowly erupts. When they move towards each other pressure builds up, leading to an explosion of magma. These are the vulcano’s we know and fear.

Let me tell you why I called this blog post the Marketing Vulcano. I use the parallel of a vulcano to express my vision that there are three trends in marketing that are colliding.  Everyone is doing the same thing. It’s probably also what occupies you daily:how can I approach the mass of consumers to gain a little bit more awareness“. When everyone is doing the same thing, it becomes harder and harder to win.

This one directional pressure will cause an explosive move into a new dimension. The winners will be the companies that move towards the new dimension, being “how can I turn my customers into ambassadors“.

We will first discuss the three trends with you. You will have to take a step back. Stop worrying about the operational details. Focus on why you are doing what you do.

We then highlight some elements of the new trend. We conclude with a vision of how ecommerce could look in the near future.

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Trend 1: Mixing models

While ecommerce started out with simple products, consumers have started using ecommerce for more and more complex products.

  • Technical complex products like computers.
  • Complex services like subscriptions, insurance and mortgage.
  • Even personal complex products and services, like healthcare.

Retail has lost much territory, but this trend will slow down. There is a reverse trend going on. We see companies that started as 100% ecommerce now open retail stores. There are brand stores like Philips in Amsterdam, focused on getting interactive customer feedback. We see consumers orient on internet and then buy in a retail shop and visa versa. We see stores that are truly multi channel, with a consistent presence in retail and ecommerce. Retail has some characteristics that are favored by customers. Being able to touch the product is very important in this. Personal interaction is a second mayor differentiator. In retail the shop assistant can work from the customer’s needs and build up value. That is key, because customers need a product, but they pay for the value they perceive. Reversely, when you fail to build value for your customer, you can only compete on price.

In short, we are moving to a more mixed model of the purchasing process.

Trend 2: Standardization

In the early days of ecommerce you had good and bad websites. You could stand out by having a site that worked well and was intuitive. Nowadays the CMS standard systems are so good, even a small shop can be at high standards. Plus you can choose from hundreds of website builders. There certainly still are quality differences, but almost all of these website builders will build a decent website for you.

Also in the area of Marketing much knowledge is standardized in plug-ins and services. Tracing customers, building up CMS databases, email marketing, customer service, and feedback. Customer reviews are also automated and available as service from content companies. All is available and it’s hard to find an ecommerce site that doesn’t have this organized.

When there is little difference between different suppliers, economic law tells us you will end up in fierce price competition, and that is exactly what has happened. The rise of price comparison sites only aggravated this trend. Investments in ecommerce are still big, but the pig trade cycle predicts that at a certain moment in time there will just be too much capacity built up and the shake out will start.

On the cost side, Ecommerce is spending huge amounts of money on Search Engine Marketing, Social Media Marketing and other forms of internet marketing. The lack of differentiation leads to hugh marketing budgets to win the customer. Google, Facebook and other media are exploiting their unique position in digital advertising. Based on the pressumption they can’t be omitted, the prices for their services are rising continuously.

Conclusion: strategies based on technique only are bound to loose importance. As technical innovations are slowing down, it is the effective usage that will create a winning strategy. The rising cost of the digital advertisement platforms will cause companies to look for a different approach.

Trend 3:  Social Media

Consumers adopted social media much earlier than companies. Due to the fact that consumers were on social media, companies had to be present as well. First mainly to prevent damage, as customer service. Nowadays most also publish campaign material, more or less like they would do on television. The best companies also ask for feedback.

Social Media has fundamentally changed the relation between customers and companies. In the mass media era, companies were in control of the public opinion. With the rise of social media every customer is a reporter too. The consequences are various:

  • One customer can break the reputation of a company.
  • Customers are used to being in contact with large groups of digital relations. The concept of “near relationship” has completely changed. The world has become a village.
  • People get an overload of information. All sources compete on an equal level for attention. It has become very hard to make a message stand out.
  • As a reaction to the power of the big companies in the mass media era, the current generation puts more trust in messages by peers on internet. Research shows that word of mouth is currently a hundred times more influential than an expensive marketing campaign. This creates a challenge for marketing.

Conclusion: companies will have to find a way to fulfil the expectations of customers in this social media era.

Focus on the mass

The three trends have build up pressure in one particular direction: making the large mass of people aware of your company in order to sell to a small percentage of them.

This concept originated in the mass media era. Mass media made it possible for companies to reach large groups of people with their advertisement. Ecommerce increased the focus on the mass of consumers. Websites are cheap to operate compared to retail and allow for presentation to groups much larger than any shop can fit. The commercial strategy of Ecommerce focusses on SEO optimization and Google adwords to maximize page views..

The rise of social media as commercial platform in the last couple of years has aggrevated this concept to hugh dimensions. An advertisement that goes viral can reach millions of potential customers in a day. Much more than search optimization can ever deliver.

It has been proven that in any large group of people 3 percent of the people are ready to buy, regardless the product under investigation. Based on this knowledge, the strategy to be visible to a large community makes sense. But the strategy is too simple, is becoming less effective and more expensive.

customer ambassadors

Research (see for instance SeeWhy) shows that Social Media Marketing has only limited impact on conversion. In their research social media accounted for 30% of the visitors. Unfortunately this resulted in only 2% of the sales.

What sells is relation, trust and service. The lava of marketing vulcano is focus on the individual customer. We see several movements towards this customer focus.

  • Email marketingto build a relation with current customers.
  • Personalization of site contentbased on behavior inside or outside the webshop.
  • The rise of trusted brandsin Ecommerce, like Amazon. Trusted brands can ask higher prices, regardless their bad listing on comparison sites.
  • Brand web storesare often times preferred above webshops that sell the same product at a lower price.
  • The popularity of consultants, like Mark Schaefer, Jay Baer, Nisandeh Neta, who teach companies to build marketing upon a trusted relationship with satisfied existing customers.

Email marketing and personalization sound like a personal approach, but these concepts make only a first step. They give a twist to the “reaching the mass” concept in the right direction. The mailing list is intended to be as big as possible. Customers are classified in a number of groups. Each group gets a specific message. The great thing about them is that they base an offer on previous purchases of this customer. Personalization basically does the same thing, but it does it real-time while the customer is browsing the site.

Why is this just the first step? What’s lacking is that the customer does not perceive this as a personal approach. It is a smart automated approach. Today’s customer however expects a personal connection with the vendor and transparent direct communication. Please check my blog about this: 5 elements of Customer Expectation . Email marketing and personalization of websites don’t fulfill these elements. For the customer to feel connected to your shop or brand, you will need to do more.

REDEFINING MULTI-CHANNEL

Our vision is that the Multi-channel concept will start to mean more than just selling and advertising via multiple channels. The methods of retail and ecommerce will mix into one new approach, picking the best of both worlds. The individual customer approach of retail and the digital information of ecommerce will be blended into a new type of interactive ecommerce. Ecommerce will become as entertaining and personal as retail.

Social media is now used to reach millions of people at an inconvenient moment. The future of social media is to interact digitally with a limited number of people at the moment you are relevant to your customer. We will start interacting with customers as a community in the web shop. Consumers are tired of being overloaded with irrelevant information. Being relevant becomes the most important differentiator. We will move from high reach with low impact to low reach with high impact.

We will have to learn to use social media that way. Topics that companies will have to handle are delegation of control and interactive public feedback. These skills are common in retail, so companies with a strong background in retail will have an advantage.

Additionally social media platforms will develop functionality to improve this interactive shopping. Facebook and Twitter are not fit for interactive shopping. Their strength is reaching the mass public. The new social media will need to be part of the customer’s action. That requires that it is really interactive and that relevance to the consumer’s current action is guaranteed.

In our previous post we already concluded that the winning companies will be the ones that manage to scale up personal interaction with their customers. Success will be built upon relationship and trust. Technology will only temporarily be a differentiator. Advertisement will not disappear, but it will no longer be sufficient.

What will make the difference is the people behind the brand, their strategy and their capability to listen to customers and turn customer feedback into a relevant offering.P1070688-3

What do you think?

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PS: This song Dancing on the Vulcano  used to one of my favorite songs.