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RetailMarketingPro

  • Digital Shopping Is Shaping Up To Become The New In-Store Retail Experience

    Digital Shopping Is Shaping Up To Become The New In-Store Retail Experience

    Despite stubbornly high inflation and aggressive interest rates biting into consumers’ disposable income, as prices remain elevated, new data suggests that shoppers are continuously looking for more seamless digital experiences in retail and department stores. 

    At the end of January, online grocery sales declined by 1.2% finishing off at $8.4 billion in the U.S. market. Demand for ship-to-home was also down, which includes the likes of FedEx, UPS, and USPS. 

    Experts suggest that the decline in these services was largely driven by the uptick in big-box retailers now offering direct-to-home delivery for shoppers, taking on logistical responsibilities themselves, instead of using third-party carriers. 

    Mass demand for online shopping during the height of the pandemic helped solidify the future of the online retail industry, and today shoppers can find nearly anything and everything they need online. 

    While this has created a massive opportunity for retailers, from all industries to transition their operations online, and present consumers with a more accessible channel – grocery retailers were slow to adapt, despite seeing steady growth during the pandemic era. 

    With many pandemic-related concerns now in the rearview, grocery chains and mass stores are creating a more digital in-store experience, as it hopes to draw in walking customers to their brick-and-mortar locations. 

    The drive to digital 

    Consumers have become accustomed to the convenience of online shopping, whether it’s for home goods, clothing, or even groceries. Everything they want and need can be found online, price-matched, and shipped straight to their door. 

    On top of this, shoppers can shop from any device they see fit. From computers to tablets, smartphones, and even mobile apps – it’s all accessible through a few clicks and swipes. 

    The rise of smartphone adoption among consumers in recent years has meant that retailers can create a multifaceted shopping experience. Research shows that around 82% of shoppers will consult their phone before making an in-store purchase. 

    With the internet so readily available, shoppers can now quickly compare prices from different retailers and stores, read reviews, or in this case, follow up on nutritional and dietary information relating to their grocery purchases. 

    What’s more, is that nearly every popular and big-box retailer now offers an online option. In the past, a few niche brands and businesses had a website, with a small online store – today, the picture is completely different. 

    A February report showed that around 7.8% of U.S. consumers purchase groceries online. That’s because big names such as Walmart, Amazon, Target, and Krogers, among others, all now offer online shopping and delivery services. 

    Even more, these stores are making use of their delivery teams to get items from stores and warehouses to consumers, in record time. 

    The competition for same-day delivery means that retailers are constantly looking at how they can deliver online purchases to shoppers quicker than their nearest contender. 

    That’s because consumers want convenience. They also want to see which retailer has the best deals or online benefits. The same February report showed that 62% of shoppers cite convenience as the reason for shopping online rather than in-store. A further 52% cited that online benefits and app-only deals led them to use online platforms for their grocery shopping. 

    In a similar vein, some have found that buying groceries online is often more affordable than having to go to a store. 

    A Travel Daily News article found that buying groceries online in the United Arab Emirates (UAE) can cost consumers less. The reason why consumers can save more money on their grocery bills is that they have more access to digital channels that allows them to compare prices, look for coupons, bundle deals, and even free at-home delivery. 

    There’s plenty to get excited about when a mass store or a household brand offers online deals – and now grocery chains are noticing that they need to step up their digital game if they want to continue playing with corporate contenders such as Walmart and Amazon. 

    The digital experience coming to a store near you 

    Digital needs are creeping into every known industry, and as the Internet of Things (IoT), Software as a Service (SaaS), and Artificial Intelligence (AI) become more mainstream, we could soon see technological innovations reach our favorite local grocery store.

    In this instance, the case may be true for a small handful of well-known grocery chains that have already started mapping the customer journey through digital and technological innovation. 

    Kroger has more than 2,800 stores nationwide across 35 states and operates other grocery retail stores including Ralphs, Dillion, Smith’s City Market, Jay C, Pay Less, and Bakers, among a list of others. 

    In the last couple of years, Kroger’s introduced digital product displays on shelves in some of its stores. Powered by Microsoft Azure, the digital sensors, or EDGE – Enhanced Display for Grocery Environment – can help process data generated by customer behavior, buying trends, and demand for certain products. 

    EDGE is connected to IoT sensors, which can deliver real-time data to stores, allowing them to monitor which products have low inventory levels, require restocking, and for customers display discounted prices. 

    Idaho-based grocery store, Albertsons, which has more than 2,500 stores, has steadily been experimenting with digital “smart” shopping carts in some of its stores. 

    Albertson’s “smart” shopping carts allow customers to ring up items as they place them in the cart, eliminating the need for them to go use checkout points. 

    This is similar to what we’ve seen Amazon has been trialing the last couple of years with its self-checkout stores, which the company heroically named Amazon Just Walk Out. 

    Research by McKinsey found that if a grocery store can properly implement tech-enabled self-checkout, it can help improve in-store productivity by 6% to 12%. This means that grocery stores will require less in-person labor at checkout counters during operational hours. 

    While it shows how technology can benefit grocery stores, not only in terms of physical in-store sales, customer experiences, and productivity, it’s still not able to compete on the same levels that eCommerce can offer consumers. 

    Final thoughts 

    While it’s hopeful that grocery stores will in the coming years adapt for the more digitally native consumer, it’s perhaps a race against time for some to ensure their longevity and ensure their long-term growth. 

    While eCommerce and online retail remain the triumphant winner, the introduction of digital can only further enhance an already well-known practice that has helped shaped the virtual shopping reality. Yet this time round, it’s up to grocery chains and big-box names to bring digital back to where it was once considered irrelevant. 

  • Walmart Teams Up With Salesforce to Sell Its Retail Software

    Walmart Teams Up With Salesforce to Sell Its Retail Software

    Walmart is making a major move into retail software and services, teaming up with Salesforce to sell its solutions to other retailers.

    Walmart revolutionized the retail market thanks to its focus on logistics, fulfillment, and delivery. The retail giant is looking to make money off of its innovative solutions by selling fulfillment and delivery solutions to other retailers and teaming up with Salesforce to make it happen.

    “Through this partnership, retailers can leverage the same innovative and scalable technologies that power Walmart’s pickup and delivery experiences,” said Anshu Bhardwaj, senior vice president, technology strategy and commercialization, Walmart Global Technology. “The same technology that powers Store Assist has enabled Walmart to fulfill over 830 million orders across over 4,700 Walmart stores. Together with Salesforce, retailers can scale their business and deliver the personalized, convenient experiences shoppers expect.”

    “Salesforce is thrilled to partner with Walmart as it transforms its business and further expands into the digital technology market,” said Tyler Prince, Executive Vice President, Alliances & Channels, Salesforce. “Through this partnership with Salesforce, Walmart can grow its business in new ways by productizing its proven retail processes – empowering other retailers to create new and personalized experiences for their customers.” 

    Walmart says retailers will be able to take advantage of three major features, including Buy Online and Pick Up In-Store (BOPIS), use Walmart GoLocal to manage local deliveries, and take advantage of Salesforce Commerce Cloud and Order Management to manage the entire omnichannel shopping experience.

    “Shoppers continue to expect brands to deliver highly connected and frictionless experiences across physical and digital touchpoints. In fact, 1 in 5 online orders placed the weekend before Christmas were picked up in store,” said Rob Garf, vice president and general manager of retail, Salesforce. “With the combined power of Walmart and Salesforce, retailers can drive success with best-in-class technology to advance their omnichannel capabilities, drive efficiency and ensure that every purchase quickly gets into the hands of the shopper – no matter where they are.”

  • Google Brings ‘Retail Search’ to Cloud Customers

    Google Brings ‘Retail Search’ to Cloud Customers

    Google is expanding its cloud services, bringing Retail Search to its clients in an effort to help them provide the best experience to their own customers.

    One of the biggest issues online shoppers face is finding the products they’re interested in. This can especially be apparent when comparing retail platform search capabilities with the Google Search features customers have become accustomed to.

    Google Cloud is now bringing the power of its search to retail clients, with Retail Search, which the company unveiled in a blog.

    This fully managed service is easily customizable, enabling organizations to craft shopper-focused search experiences. Our site search solution builds upon decades of Google’s experience and innovation in search indexing, retrieval, and ranking. Retailers can make product discovery even easier for shoppers, while optimizing for their business goals with advanced capabilities

    Retail Search gives clients the ability to offer advanced query understanding, meaning customers will have better success finding what they’re looking for even with the broadest of search terms. The service also includes semantic search, which matches product attributes with relevant products.

    Customers are already seeing the benefit of Retail Search.

    “With limited customer signals and no historical data, descriptive long-tail searches are some of the most challenging queries to understand,” said Neelima Sharma, senior vice president, technology, e-commerce, marketing and merchandising at Lowe’s. “We have been partnering with Google Cloud to give our customers relevant results for long-tail searches and have seen an increase in click-through and search conversion and a drop in our ‘No Results Found’ rate since we launched.”

    Google Cloud customers interested in learning more can visit Discovery Solutions for Retail or contact their Google Cloud field sales representative.

  • Shopify Evolving Into World’s First Retail Operating System

    Shopify Evolving Into World’s First Retail Operating System

    “Shopify is evolving into the world’s first retail operating system,” says Shopify COO Harley Finkelstein. “We think the future of retail is retail everywhere. A brand that’s going to be successful in 5, 10 or 15 years from now needs to sell across any platform and across any channel where they have customers. The idea is that it all feeds back in one centralized back-office, the retail operating system, which is Shopify.”

    Harley Finkelstein, COO of Shopify, discusses how COVID has dramatically sped up the timeline for commerce moving online and has also moved Shopify closer to its goal of becoming the world’s first retail operating system:

    Shopify Evolving Into World’s First Retail Operating System

    Most people assume that Shopify is an ecommerce provider. We have more than a million stores on Shopify. If you were to aggregate our stores in the US we’d be the second-largest online retailer in America. Of course, we’re not a retailer but we’re a platform. But we now have these great economies of scale that we’re using to level the playing field for entrepreneurs and small businesses. That being said, what really Shopify is evolving into is the world’s first retail operating system. 

    What we’re trying to figure out is what do brands and entrepreneurs and retailers need, not just now but in the future? We think the future of retail is retail everywhere. A brand that’s going to be successful in 5, 10 or 15 years from now needs to sell across any platform and across any channel where they have customers. This idea of enabling Shopify merchants to very easily push their products to the Amazon Marketplace or the eBay marketplace or now the Walmart marketplace, that gives them access to a new set of consumers. The idea is that it all feeds back in one centralized back-office, the retail operating system, which is Shopify. 

    Then we’ve gone ahead and asked what else can we do for these merchants? Can we do capital? We’ve now given out about a billion dollars worth of cash advances and loans to small businesses. We’re doing fulfillment and we’re doing shipping. We’re increasing the scope and the relationship that we have with the million stores on Shopify. This is allowing them to become category leaders.

    COVID Speeds Up The Ecommerce Revolution

    From our view, it seems like the commerce world that would have existed in the year 2030 has really been pulled into the year 2020 (as a result of the COVID crisis). We’ve seen ecommerce as a percent of total retail go from 15 percent to 25 percent in the last three months. That’s the same growth rate that we’ve seen over the last 10 years. What really has emerged here is sort of this tale of two retail worlds. On one side you have these resilient retailers that are doing great, they’re pivoting, and they’re expanding their businesses. On the other side, you have these resistant retailers who have not made it. In many ways, it’s probably the most exciting time for retail in a very long time. 

    We talk a lot about these direct to consumer brands that are becoming category leaders. The Allbirds and the Gymsharks who started on Shopify when they were very small and have grown to become the incumbents in their industry. Every 25 seconds a brand new entrepreneur makes his or her (products) for sale on Shopify. We talk a lot about those new startups, those new DTC brands. But actually, what we’re also seeing on Shopify are companies like Lindt Chocolate or Heinz ketchup or Chipotle. They are signing up for Shopify and basically from like five days from contract to launch they are completely changing their businesses. 

    This resiliency isn’t simply in the hands of just the smallest of brands. Big companies are also beginning to think a lot more about how to stay resilient in this time. They’re moving well beyond ecommerce or thinking about offline commerce now. They’re thinking about how do they sell across social media? How do they sell across different marketplaces? So no, I don’t think it’s too late (to enter ecommerce) but I do think they have to rethink their strategies.

    Shopify Evolving Into World’s First Retail Operating System Says Shopify COO Harley Finkelstein
  • Home Depot Canada Caught Giving Customer Data to Meta

    Home Depot Canada Caught Giving Customer Data to Meta

    Home Depot is in hot water, with its Canadian division sharing customer data with Meta without the proper consent.

    The Office of the Privacy Commissioner of Canada (OPC) found that Home Depot of Canada had been sharing customers’ e-receipt information with Meta. The information included email and in-store purchases.

    “As businesses increasingly look to deliver services electronically, they must carefully consider any consequential uses of personal information, which may require additional consent,” Commissioner Philippe Dufresne said.

    “In this case, it is unlikely that Home Depot customers would have expected that their personal information would be shared with a third party social media platform simply because they opted for an electronic receipt. As Canada marks Data Privacy Week, it is the perfect time to remind companies that they must obtain valid consent at the point of sale to engage in this type of business activity.”

    The OPC’s investigation showed the behavior had been going on since at least 2018. Meta evidently used the info to compare users’ purchases with the Home Depot ads showing in their Facebook feeds, providing information regarding the effectiveness of ad campaigns.

    Home Depot defended its action by saying it relied on “implied consent” and that its privacy policy was available for all to read. That policy says the company may use “de-identified information for internal business purposes, such as marketing, customer service, and business analytics” and that it “may share information for business purposes,” such as “with third parties.”

    Thankfully, the OPC didn’t buy the Home Depot’s defense.

    “The explanations provided in its policies were ultimately insufficient to support meaningful consent,” Commissioner Dufresne said.

    “When customers were prompted to provide their email address, they were never informed that their information would be shared with Meta by Home Depot, or how it could be used by either company. This information would have been material to a customer’s decision about whether or not to obtain an e-receipt.”

    The OPC also did not buy Home Depot’s explanation that it didn’t expressly ask for consent in an effort to avoid causing “consent fatigue” among consumers.

    “Consumers need clear information at key transaction points, empowering them to make decisions about how their personal information should be used,” Commissioner Dufresne said. “Consent fatigue is not a valid reason for failing to obtain meaningful consent. Many customers would be surprised, as the complainant was in this case, to learn that their personal information had been shared with a third party like Facebook without their knowledge and consent.”

    As we have stated at WPN many times before, it’s completely understandable when free services use consumer information as a way to offset the cost of offering those free services. When consumers are paying for a product or service, however, there is absolutely no excuse for then collecting and monetizing the consumer’s information.

    In this case, the only thing more insulting than Home Depot’s actions was its lame justification of those actions. Thankfully, the OPC saw right through Home Depot’s arguments.

  • Conversational Marketing Closes the Gap Between B2C and B2B, Says Drift Marketing VP

    Conversational Marketing Closes the Gap Between B2C and B2B, Says Drift Marketing VP

    Conversational marketing is a whole new way of thinking about marketing and sales, says Dave Gerhardt, VP of Marketing at Drift. “We go to our jobs in B2B and none of the tools that we use match how we actually buy as real people,” he says. “That’s the most exciting thing to me about conversational marketing. It’s really closing the gap between B2C and B2B. We just call it B2P, marketing to people.”

    Dave Gerhardt, VP of Marketing at Drift, was recently interviewed on the B2B Growth podcast by John Rougeux who is VP of Marketing at Skyfii. Gerhardt discusses conversational marketing as a new B2B product category and how it is changing marketing from reaching out to you later to a conversation that is happening now:

    Conversational Marketing is About Connecting You Now

    Conversational marketing is a whole new way of thinking about marketing and sales. The traditional way of doing marketing and sales is all about later. Come to my website and fill out this form and somebody is going to reach out to you later, when it’s convenient for them. The big shift that is happening in marketing and business over the last five to ten years is customers have all the power today. You can’t make people wait. Information is free now.

    I can find anything I want to know about a company without ever having to go to your website. It’s crazy to think that you are going to force people to go to your website, fill out a form, wait three days to hear back from your sales team, and then get a demo. Conversational is all about connecting you now with the people who are ready to buy now while they are live on your website.

    B2P – Marketing to People

    It’s not about buyers. It’s not about sellers. It’s not about sales. It’s not about marketing. It’s about people. That’s how people all communicate online today. I pressed one button in my car and I got a list. I ordered something from Amazon while I was here this morning to send back to my house and it’s going to be there tomorrow when I get home. There are countless examples of that. That is how we all behave online in our real lives today.

    But then something happens weird happens. We go to our jobs in B2B and none of the tools that we use match how we actually buy as real people. That’s the most exciting thing to me about conversational marketing. It’s really closing the gap between B2C and B2B. We just call it B2P, marketing to people.

    What Ties Our Products Together is Conversation

    We have an email product and we have a landing page product. Black and white versions of those people would say everybody has email, everybody has landing pages. The thing that ties those together is conversation. That forces us to think about what is conversational email? What is conversational landing pages? What is conversational whatever? That one word forces our product team to think about how can we change this? If our fundamental stance as a company is that the internet should be one conversation, then how does that weave into everything that we build?

    Ultimately what we care about is that email becomes a conversation. Meaning, the way that marketers have had to use email the last decade is a one-way channel. Email is meant to be a two-way channel. Marketers have been using it as, “John come to my webinar.” What happens if you actually respond to that email? Most of the time you can’t because it’s donotreply@ or it just goes to some inbox where nobody is answering it. That is a terrible experience. Our belief is that if you reply, “Hey actually I can’t make it. Can you reregister my colleague?” That should get handled. We are thinking of that from an evolution standpoint.

    The same thing with landing pages. Most landing pages today are static. You go to the landing page, put a bunch of info in and you are gone. What if that was a real-time conversation on the page? That one topic has to weave itself into everything we do from a product perspective.

    >> Listen to the complete interview with Drift Marketing VP Dave Gerhardt on the B2B Growth podcast.

  • Why Is Content Marketing So Powerful?

    Why Is Content Marketing So Powerful?

    Content marketing is a powerful digital marketing strategy that can provide many benefits for companies:

    1. Increases brand awareness: By consistently creating and distributing valuable content, companies can increase brand awareness and establish themselves as thought leaders in their industry.
    2. Builds trust and relationships: By providing valuable and informative content, companies can build trust with their audience and create a loyal customer base.
    3. Cost-effective: Content marketing is considered to be more cost-effective than traditional forms of advertising, as it doesn’t require large budgets for ad placements.
    4. Generates leads: By providing valuable and informative content, companies can attract and generate leads, by making it easy for potential customers to learn more about the company’s products and services.
    5. Long-term results: Content marketing can generate long-term results, as the content that is created can continue to be shared and consumed by the audience even after it’s initially published.
    6. Versatility: Content marketing can take many forms: Blog posts, infographics, videos, webinars, e-books, white papers, social media posts, and more. This allows for a variety of ways to reach and engage with the target audience.
    7. Inbound: Content marketing is an inbound marketing strategy, meaning that it helps to attract customers through valuable and informative content, rather than interrupting them with traditional forms of advertising.
    8. SEO: Content marketing can also improve search engine rankings by providing valuable and relevant information that search engines and users find useful.
    9. Measurable: Content marketing allows to track and measure the results through analytics, which helps to evaluate the effectiveness of the strategy and optimize it accordingly.

    In summary, content marketing is great because it helps to increase brand awareness, build trust, generate leads, and provides long-term results in a cost-effective and versatile way, aligning with the way people consume and engage with information today. It also allows for measurable results and helps to improve SEO.

  • Why Your Content Isn’t Ranking

    Why Your Content Isn’t Ranking

    It happens all the time—you spend hours creating what you think is an amazing piece of content. You post it, and then weeks or months later, it’s still not ranking. If your content doesn’t rank, your audience doesn’t see it, and you can feel like your efforts were wasted. 

    Search engine optimization (SEO) is the main goal of content creation. You want your content to rank organically and ideally as high as possible on the first page. 

    Even well-written content doesn’t always rank, though, so why is that?

    Below we explore some of the potential reasons a piece of content may not perform well organically after you post it. 

    Understanding Content’s Ranking Potential 

    In general, the more content you publish that’s high-quality on your site, the more likely you are to rank for keywords across the entire site. Google likes to see a lot of content because then the algorithms that fuel the search engine have more context, and they’re better able to understand what your site is about. 

    Each time you publish a new piece of content, Google is getting more keywords, and that means more understanding of your brand. 

    That’s why optimizing all of your content with semantically relevant keywords in your headers, descriptions, and titles is essential. 

    That doesn’t mean you go for quantity over quality, however. Google can actually end up not only ignoring your content if it’s not high-quality—you could also be penalized. 

    Along with the words you use in your content creating ranking opportunities, you’re also able to optimize your images. The way you optimize images is going to be a major ranking factor that drives traffic. 

    So what if you’re in a situation where you know you’re creating great content that you feel is properly optimized, and you still aren’t ranking?

    We’ll cover these situations below. 

    Your Keywords Are Too Competitive

    Probably one of the biggest reasons your content isn’t ranking is that you’re targeting keywords that are too competitive. Yes, they have a lot of volumes, and that can make them a shiny target, but to rank for keywords that are extremely competitive is going to be almost impossible for a new piece of content. 

    First of all, stop with the one and two-word targeted keywords. Instead, look for long-tail, less competitive keywords. 

    You should do a keyword search on everything you’re thinking about using for your content. Under a search box, if you type your targeted keyword in, you’ll see gray text that lets you know how many results it brings up. You can also use keyword tools to figure out the competitiveness of any given word or phrase. 

    Irrelevant Content

    You might create content that you think your ideal audience wants to see, but you might be wrong here. 

    You have to think carefully about why you’re creating every piece of content before you spend time and effort on it. You also want to consider if you’re going to be able to truly add value to the lives of your readers with what you’re producing. 

    If you’re not thinking carefully about creating value, you’re going to have weak, shallow content that doesn’t get much engagement.

    The Content Is Outdated

    If you have a lot of content on your site already and you don’t think it’s ranking as well as it should be, you need to consider whether it’s outdated. You need to update your old content on a regular basis, and that can help you boost its ranking. 

    If you’re overwhelmed and have a lot of content, start with an audit. Go over your current content by performance, and then from there, look at your oldest and underperforming pieces of content to figure out if you could make changes that would help them be more relevant or updated. 

    Your Site Has Technical Problems

    If your site as a whole has technical issues, it’s going to prevent individual pieces of content from ranking. 

    Common technical SEO problems include not having an XML sitemap, broken links, coding errors, privacy concerns, or Google not indexing your site. 

    You may need to work with a developer if you think your problem stems from your technical SEO. 

    Similar to some of the technical issues already mentioned, you also need to ensure your site is fast and mobile-friendly. Google has outright said that its priority in indexing content and sites is mobile-first. You can check using Google’s Mobile-Friendly Test, and if your site isn’t responsive, you need to work on redesigning it. 

    Similarly, site speed is also a critical ranking factor. If your site is too slow, you may need to invest in updates such as getting better hosting service or compressing your media files. 

    Short, Thin Content

    Just like Google wants to see updated and highly relevant content that’s tailored to the needs of your audience, you also want to make sure that your content is long enough. There’s a reason this matters.

    First, when you have longer content, it gives Google more content to crawl. 

    Also, long-form content tends to provide a very in-depth view of a topic, and that’s more likely to be high in value for a reader compared to short or thin content. 

    This doesn’t mean you fill your content with meaningless fluff to try and up the word count, though. Don’t go overboard trying to have a longer article to the point that you’re no longer adding value. 

    When you have in-depth content that’s relevant and valuable, this can help reduce your bounce rate because people are going to spend additional time browsing your site. That can in and of itself be a ranking factor for Google. 

    You Don’t Have Enough Links

    Finally, Google’s algorithm analyzes your site’s relevancy and domain authority when determining how to rank your site for particular keywords and phrases. The term domain authority was initially created by Moz, and it’s a prediction of how well your site will rank on search engines, with a score that ranges from 1-to 100. 

    The number of links pointing to your site is part of this. If you don’t have a lot of backlinks to your site as a whole and also to individual pieces of content, it’s going to be tougher for you to rank. 

    You need to use link-building strategies through relationship building and creating quality content. You should also send guest blog and content pitches to sites and publications or outsource the work to a professional link-building company.

  • Retailers Should Focus On The Last Mile, Says Justuno CEO

    Retailers Should Focus On The Last Mile, Says Justuno CEO

    “Conversion optimization is the same as it’s been for a while,” says Justuno CEO Erik Christiansen. “People still don’t want to focus on the last mile. We’ve kept to the same message that retailers should be investing in their current website visitors. There’s always low-hanging fruit to improve your business. How do you take one marketing dollar and stretch it as far as you possibly can? It’s all about creativity. That’s what marketing is and that’s what retail is.”

    Brand growth expert Austin Brawner of Ecommerce Influence interviewed Justuno CEO Erik Christiansen about conversion optimization:

    Retailers Should Focus On The Last Mile

    Conversion optimization is the same as it’s been for a while. People still don’t want to focus on the last mile. Finally, in 2020, we saw that shift when advertising got so expensive. Everyone is like, okay, we have minimal budgets, how do we stretch them? Finally, with all the competition from COVID where everyone’s shifting online everyone, they are saying that we can’t keep just throwing money at this. We’ve got to come up with the real problem.

    When we first launched we had to pivot immediately because when we mentioned the word coupon or the word pop-up people just ran the other way. It’s been ten years of education and we’ve kept to the same message of investing in your current website visitors. Our main job still is to educate the online retailer about the basics. We ask most businesses, as you know with email, are you doing a 30, 60, 90 day, the basics? Are you doing a cart abandonment email? You cover the basics and you get so much further ahead.

    There’s always low-hanging fruit

    Everyone thinks businesses are run perfectly but most businesses are just a mess. What I’ve been trying to do is challenge my team to look at the basics. There’s always low-hanging fruit to improve your business. When it comes to retail, where’s the low-hanging fruit? Let’s break out your business to the basics like new visitors versus repeat. With the new ones, how many are there? What percentage of emails are we capturing? Are we sending those emails to your ESP? Are we putting in the basic workflows? There’s so much low-hanging fruit.

    Then, you’re sending these emails, are you reinforcing those campaigns on-site? You spend so much time designing the email, sending it. Then it comes to that shopping cart abandonment. Do you even know how many people come to your cart each day? Do you know how many carts get abandoned and the dollar value? What can we do? The basics are still very much there in terms of opportunity to help people increase their sales lead capture and sales. How do you take one marketing dollar and stretch it as far as you possibly can? How do you also get creative? It’s all about creativity. That’s what marketing is and that’s what retail is. Retail is retailing and getting your hands dirty.

    Retailers Should Focus On The Last Mile, Says Justuno CEO Erik Christiansen
  • How AI is Influencing Digital Marketing

    How AI is Influencing Digital Marketing

    The world of digital marketing is gradually changing thanks to chatbots, virtual assistants, and other AI technologies. While some marketers continue to insist that robots cannot replace people, others stay up with the latest developments in AI and understand what changes will soon be made to digital marketing. In fact, more than 50% of marketers feel that using artificial intelligence in their data strategy is crucial.

    Platforms like Get Cash, for example, employ AI to match borrowers with approved lenders within a 24-hour period. Even if your credit is less-than-perfect, you can apply on the internet for the finest short-term loan offer ranging from $100 to $5,000. AI is to blame for the loan requests being processed more quickly than in most banks and lending institutions.

    However, let’s get back to the topic of how AI is influencing marketing. AI enables businesses to make choices that result in more creative and specialized advertising. That’s not all, though. Here are a few more ways that AI is having an impact on marketing. These are ways that businesses cannot afford to ignore. 

    Voice Search Is Growing

    It’s no surprise that many people are switching to hands-free data entry while traveling. As the world becomes more mobile, all kinds of changes to our lifestyle can be expected. According to recent research, technology has improved to the point where many algorithms can now accurately distinguish human speech about 95% of the time.

    According to the most recent research, the voice search functionality of their smart speakers will be used by up to 33.2 million US consumers this year. 

    In 2018, Nielsen found that one in every four Wi-Fi-enabled homes in America had a smart speaker. Therefore, companies will need to modify their SEO and marketing tactics in response to the growing popularity of voice search.

    Additional Applications for Augmented and Virtual Reality

    Although VR and AR have been around for quite a while, they are still seen as new. Although AR is currently more often used for video games these technologies are increasingly being employed for marketing. More and more businesses are realizing the potential of AR and VR as effective marketing tools.

    Consider the augmented reality furniture app that allows you to test furniture, acoustic panels, or other amenities in your home before purchasing it. This is a great illustration of how AR can be both practical and entertaining. Additionally, some clothing companies have joined the virtual reality revolution. They design apps that let consumers try various outfit combinations without leaving their houses.

    In order to avoid missing out on this fantastic opportunity, it is necessary to start investigating how to incorporate VR and AR into your marketing strategies immediately.

    The Use of Chatbots for Marketing Is Growing

    Chatbots facilitate marketing, which is why their acceptance is expected to increase. These AI innovations are perfect for handling the early stages of the marketing process. For instance, they are great at gathering contact information and information for a sales call, responding to typical customer service inquiries, or providing guidance on common technical issues. Up to a certain point, these chatbots assist in automating client communication before directing them to a person for assistance.

    Chatbots may significantly improve the marketing process. Because most of this process is automated, you and your team will be able to perform more marketing duties and close more business as a result.

    Chatbots on Facebook Messenger have also made great strides. Businesses can now offer an in-app shopping experience thanks to them. Customers can browse and even make purchases inside the chatbot with the right configuration. Therefore, it makes sense that more businesses are attempting to incorporate chatbots into their marketing plan.

    More Individualized Advertising

    The Facebook team started a project named Rosetta a few years ago. The initiative intends to improve the caliber of material that Facebook users see in their news feeds. Rosetta employs AI to improve user experience by determining users’ wants and maximizing their Facebook interactions.

    Fundamental changes are occurring in traditional marketing procedures. These changes range from improved engagement to greater client loyalty and strong conversions. The quantity and variety of user data available today, including usage of social networks, purchase history, and personal preferences, pave the way for effective personalization.

    However, businesses ought to do more than merely gather data; they ought to combine and analyze it in order to develop campaigns that directly cater to the needs of the people. This may be difficult, but the payoff is substantial.

    The benefits of AI in digital marketing are hard to dispute. Marketing organizations can now employ emerging technology to enhance their tactics as they become more widely accessible. 

  • YouTube and TikTok Are Blowing Facebook Away in Teen Usage

    YouTube and TikTok Are Blowing Facebook Away in Teen Usage

    Facebook has a major problem in its attempts to appeal to teens, with the platform being blown away by both YouTube and TikTok.

    Younger markets are critical for social media platforms and their future growth prospects. The more attached users are to a platform early on, and the more their online social lives are intertwined with it, the more impetus there will be for them to continue using it in the coming years.

    Unfortunately for Facebook, its usage among this critical demographic — ages 13 to 17 — has plummeted. According to Pew Research Center, the number of teens saying they use Facebook has dropped from 71% in 2014-2015 to a mere 32% in 2022. In contrast, 95% of teens use Google’s YouTube, while 67% use TikTok.

    Pew also found some interesting demographic differences within the target group.

    There are some notable demographic differences in teens’ social media choices. For example, teen boys are more likely than teen girls to say they use YouTube, Twitch and Reddit, whereas teen girls are more likely than teen boys to use TikTok, Instagram and Snapchat. In addition, higher shares of Black and Hispanic teens report using TikTok, Instagram, Twitter and WhatsApp compared with White teens.

    The study is bad news for Facebook and may provide insight into why the company is pivoting so hard toward the metaverse. If Facebook can execute its vision for the metaverse, it may be able to reclaim its crown.

  • TikTok Under Fire for Potential Keylogging, Some Say Concern Is Overblown

    TikTok Under Fire for Potential Keylogging, Some Say Concern Is Overblown

    A security researcher has called out TikTok for inserting code in its in-app browser that could be used to log keystrokes, but not everyone is convinced.

    TikTok is frequently in the news over concerns with its handling of user data and how much influence — and access to that data — Beijing has. In the latest round of concerns, security researcher Felix Krause has highlighted the dangers of apps that have their own in-app web browsers, including TikTok.

    According to Krause, TikTok’s in-app browser injects JavaScript into third-party websites when a user visits them from within the app. The code can be used for a variety of purposes, including logging keystrokes and collecting sensitive information.

    Krause admits that he can’t say for sure how TikTok is using the JavaScript code it’s inserting:

    We can’t know what TikTok uses the subscription for, but from a technical perspective, this is the equivalent of installing a keylogger on third party websites.

    Read more: Oracle Begins Audit of TikTok’s Algorithms for Beijing’s Influence

    Zach Edwards ― the security researcher that discovered some Microsoft trackers were not blocked by DuckDuckGo before the latter fixed the issue — pointed out the dangers of conflating what could happen with what is happening.

    TikTok sent the following statement to Motherboard, strongly denying Krause’s implication:

    The report’s conclusions about TikTok are incorrect and misleading. The researcher specifically says the JavaScript code does not mean our app is doing anything malicious, and admits they have no way to know what kind of data our in-app browser collects. Contrary to the report’s claims, we do not collect keystroke or text inputs through this code, which is solely used for debugging, troubleshooting, and performance monitoring.

    Only time will tell if TikTok is collecting the data people type in the in-app browser, although doing so would likely be the smoking gun regulators would need to crack down on the service. Given how high the stakes are and the lack of any evidence, it seems unlikely that TikTok is guilty of this particular offense.

    At the same time, TikTok remains one of the most controversial apps or services available, with more than its fair share of privacy issues. That alone will make it hard for some people to believe the company isn’t guilty.

  • How to Increase Sales in Online Marketplaces

    How to Increase Sales in Online Marketplaces

    If you’re not selling online, are you really selling? This is a question you likely asked yourself in the beginning stages of building your business. And if you’re an executive of a company who has been selling online for a while, you may be trying to figure out how to sell more online. Even if you have the most revolutionary product lineup, getting into the hands of your audiences is not easy. 

    As the pandemic demonstrated, nearly everything is available online and ready to ship to your door instantaneously. From toilet paper to milk, bedding to televisions, everything you could possibly want, need, or desire can be found online. This fact is mindblowing when you think about how shopping used to be strictly done in-person. Now you can pre-order your groceries from the comfort of your couch and order school supplies for your kids at the same time. 

    The online marketplace is cluttered with literally millions of brands competing for the same consumers. Differentiating yourself as a brand can be tricky, no matter if you are a small business or a large retailer. If you’re looking to increase your brand’s sales online, then you’ve come to the right place. Below are three ways to boost your sales and get consumers coming back for your products time and time again.  

    1. Make Friends with Amazon

    Despite your personal feelings toward Amazon, the truth is, selling on Amazon can be extremely beneficial. Consumers who are willing to try a new product will likely first search on Amazon to see if it’s available. Free, expedited shipping for Prime customers is a gamechanger for consumers in this must-have-it-now landscape. And while buying on Amazon may be simple, selling on this e-commerce site is a different story. 

    Before you start selling on Amazon, be sure to read all of its rules and regulations. Skipping this step may lead you to a suspended amazon seller account. This often happens due to lack of performance, like policy violations or a lack of sales. It can also happen, however, if you have multiple selling accounts or you are selling something prohibited by the site. Having a suspension can be a frustrating experience, and it can take days if not weeks to get your account restored. 

    Your best bet to selling successfully on Amazon is to do your homework. Make sure your business is set up with proper documentation. Once you’re on the e-commerce site, be responsible to your purchasers. If something is delayed due to inventory, communicate this with your buyers. Also, if you receive a negative comment, be sure to respond to the feedback on the site directly. These small tips will boost your Amazon seller profile and hopefully keep you far away from a suspension. 

    2. Be Active on Social Media 

    Social media platforms like Instagram and TikTok are making it even easier for users to stop what they’re doing mid-scroll and purchase products. As a business, you want to capture users’ attention when they are most vulnerable and most likely to purchase. You can do this by being an active brand on social media. This can look like creating funny or memorable Instagram Reels or having an enticing giveaway. 

    If you aren’t socially savvy, that’s alright. There are plenty of tutorials online to get you started and inspire you to create buzzworthy content. If you’re still at a loss, you may consider hiring a social guru either as a full-time employee or contractor. Having a dedicated social media person on your team can ensure your business is at the forefront of latest trends. This will pay off quickly when you see how many new customers are finding your brand through social apps. 

    Another thing to note: make sure your checkout experience is simple. The more seamless the checkout experience, the more likely someone is going to buy right away. If the process is tedious or laborsome, users will click back and continue scrolling. The likelihood of them coming back to your site to purchase is slim to none. Monitoring your consumers’ purchase journey is one key way to ensure they are completing their orders quickly and efficiently. 

    3. Manage Your Inventory

    This last tip is especially relevant today. Shortages have become relatively normal since the onset of the pandemic. Currently, everything from baby formula to tampons to Sirarchia is in low supply. The reason for these shortages stems from a weak supply chain. Raw materials are limited, human labor is varied, and shipping or transportation is unstable. This can lead to your business suffering from less or delayed inventory. 

    As a business, being upfront with your customers is key. If you are facing inventory shortages, it’s important to let your customers know before they checkout. This can look like putting a banner on the top of your website communicating this to them. Nobody wants to be surprised after they’ve already paid to find out the new item they bought will be shipped weeks from now. The sooner you communicate issues with your consumers, the more they will trust you as a brand and repeat business. 

    If you are selling on multiple platforms — like your website, Amazon, and social — then keeping up with your inventory is key. You may want to look into an inventory management system to help you and your team keep track of what is available. Moreover, implementing this system can help you track what items are in demand and when you need to order more. 

    Takeaways

    Selling online isn’t as simple as selling lemonade at your neighborhood block party. You have to get in front of the right audience in the moment they are looking to buy. You also have to create a seamless shopping experience and communicate openly to increase customer satisfaction. While you will definitely face hiccups from your online marketplaces, remember that honesty is always the best policy. Represent your business and show up for your customers with respect to become a favorable brand in their eyes. 

  • Amazon Raising Fees for Third-Party Sellers During the Holidays

    Amazon Raising Fees for Third-Party Sellers During the Holidays

    Amazon is raising third-party seller fees during the holidays, the first time the e-commerce giant has ever done so.

    Rising inflation is hitting all corners of life, impacting individuals and businesses alike. According to CNBC, Amazon is raising fees for third-party sellers in response to the economic challenges it’s facing.

    The company sent an email to sellers using Fulfillment by Amazon (FBA), informing them that they would have to pay $0.35 per item sold in the US and Canada between October 15 and January 14. Amazon said “expenses are reaching new heights,” necessitating the price hike.

    “Our selling partners are incredibly important to us, and this is not a decision we made lightly,” Amazon said in the email.

    The move is not surprising, given that FBA handles the entire processing of packaging and delivering goods to customers, a process that is directly affected by rising labor and fuel costs.

  • Get Ready for Ads on Your Phone’s Lockscreen

    Get Ready for Ads on Your Phone’s Lockscreen

    A Google-backed startup plans to bring its lockscreen platform to the US within a couple of months, turning lockscreens into another way to serve ads.

    Glance is a subsidiary of InMobi Group, the Indian ad giant. The company introduced a way to display news feeds, ads, games, and more on Android lockscreens. As a result, users are bombarded with content before they unlock their phones. The company claims its software is preinstalled on some 400 million smartphones, with its previous focus being the Indian, Asian, and EU markets.

    According to TechCrunch, the company is now in talks with US carriers to bring its platform to US phones within the next two months.

    It’s hard to fathom users actually wanting to be bombarded with ads on their lockscreens, especially when they’re already paying for both the wireless service and the phone they’re using.

    As we have stated many times at WPN, it’s one thing — and entirely expected — for a company to rely on ads when it is providing a user with a free service. It’s a completely different story when companies that are already making billions of dollars in sales and services want to degrade the user experience by placing ads atop those paid products and services.

    Perhaps the most unsurprising factor in this whole story is Google’s involvement. The company already has a near stranglehold on the online advertising market. It should surprise absolutely no one that the company is backing Glance.

    Here’s to hoping US carriers provide a way to opt-out of Glance’s “service.”

  • Why KYC is Important in Growing Customer Base

    Why KYC is Important in Growing Customer Base

    As your business grows, it is important to keep track of your customers and ensure that you follow all the necessary regulations. One way to do this is to verify Know Your Customer (KYC). A strong KYC program helps ensure that a business is only doing business with legitimate customers, which protects the business from fraud and other risks.

    What is KYC?

    KYC stands for “know your customer” and is a process that businesses use to verify the identity of their customers. The KYC process typically involves collecting customer data such as name, address, date of birth, and ID type (For example, passport or driver’s license) and then verifying this information against a reliable source. In many cases, businesses will also perform additional checks, such as asking for proof of address or running a credit check.

    By completing the KYC process, businesses can be sure that they are dealing with legitimate customers and reduce the risks associated with fraud and money laundering. KYC stands for “know your customer” and is a process that businesses use to verify the identity of their customers.

    The benefits of implementing a KYC process include:

    1. Compliance with Anti-Money Laundering (AML) Regulations

    KYC is important because it helps businesses comply with anti money laundering compliance regulations and prevent fraud. By verifying the identity of their customers, businesses can be sure that they are not dealing with criminals or terrorists.

    2. Reduced Fraudulent Activity

    KYC can help businesses avoid fraud by verifying customer identities. It helps businesses save money and protect their reputations.

    3. Improved Customer Relationships

    Customers appreciate it when businesses take measures to protect their personal information. Implementing a KYC process can show customers that you value their privacy and security.

    There are several steps you can take to improve your KYC verification process:

    1. Collect the Necessary Information Upfront

    When a customer first interacts with your business, collect the necessary information for KYC verification. It includes the customer’s name, address, date of birth, and ID number.

    2. Use Multiple Verification Methods

    Don’t rely on a single verification method, such as checking ID documents. Use multiple methods, such as phone calls or email confirmation, to verify customer identities.

    3. Keep Updated KYC Records

    Make sure to keep updated records of your customer customers’ KYC information. It will help you quickly resolve any issues that may arise.

    4. Use Technology to Automate KYC

    Various software solutions can help businesses automate the KYC verification process. It can save time and resources and improve the accuracy of customer identity verification.

    There are some challenges that businesses may face when implementing a KYC process. These include:

    1. Time-Consuming and Resource-Intensive

    The KYC verification process can be time-consuming and require extensive resources. However, various software solutions can help businesses automate KYC verification. It can save time and resources.

    2. Customer Satisfaction

    Customers may not be happy with the extra steps required for KYC verification. To overcome this, ensure to communicate with customers about the KYC verification process. Explain why it is necessary and how it will benefit them in the long run.

    3. Technology

    KYC verification can be complex and require specialized software solutions. Employees need to be properly trained on using KYC verification software and tools. It will help ensure that the process is carried out correctly.

    Conclusion

    Any business that wants to expand its customer base needs to look closely at its KYC (Know Your Customer) processes. In today’s world of increasing regulation, businesses need to demonstrate that they know who their customers are and that they are legitimate.

  • Uber Eats Now Accepts Shiba Inu and Dogecoin

    Uber Eats Now Accepts Shiba Inu and Dogecoin

    Fans of the most popular dog-themed cryptocurrencies have a new place to spend their crypto, with Uber Eats now accepting Shiba Inu and Dogecoin.

    Uber Eats doesn’t directly accept any crypto, but it does via its integration with the BitPay service. BitPay made the announcement via a blog post.

    BitPay offers a variety of options for purchasing prepaid gift cards with crypto. Gift cards can be bought with cryptocurrencies including Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Dogecoin (DOGE), Shiba Inu (SHIB), Litecoin (LTC), XRP (XRP), Dai (DAI), Wrapped bitcoin (WBTC), Gemini USD (GUSD), USD Coin (USDC), and Binance USD (BUSD).

    Despite starting as a meme, Dogecoin has become a major player in the crypto market. Shiba Inu, the “Dogecoin killer,” has similarly captured the hearts and wallets of users.

    BitPay’s expanded support for both coins will make it much easier to use them for everyday purchases.

  • Netflix Taps Microsoft to Help It Roll Out an Ad-Supported Tier

    Netflix Taps Microsoft to Help It Roll Out an Ad-Supported Tier

    Netflix is moving forward with its plans for an ad-supported tier, tapping Microsoft to help it develop the necessary infrastructure.

    Netflix has been looking for ways to increase growth, especially after the company reported its first subscriber loss in nearly a decade. One of the main options the company has been looking at is an ad-supported tier, but rolling it out requires an infrastructure that Netflix does not currently have.

    After earlier reports indicated the company was looking at Google or NBCUniversal for assistance, the company has chosen Microsoft instead.

    “Today we are pleased to announce that we have selected Microsoft as our global advertising technology and sales partner,” writes Greg Peters, Chief Operating Officer and Chief Product Officer.

    “Microsoft has the proven ability to support all our advertising needs as we work together to build a new ad-supported offering. More importantly, Microsoft offered the flexibility to innovate over time on both the technology and sales side, as well as strong privacy protections for our members.”

    The announcement is a big win for Microsoft and will hopefully help Netflix turn its fortunes around.

  • Walmart is the Roman Empire of Retail

    Walmart is the Roman Empire of Retail

    Walmart is the Roman Empire of retail, says Burt Flickinger, Managing Director of SRG. Walmart announced an impressive earnings and revenue beat that told the story investors want to hear. Walmart is winning the retail wars, especially against arch-rival Amazon. “Like Hannibal and the Carthaginians, Amazon is starting to go the wrong way.” says Flickinger. “Big win for Walmart today and they will accelerate that in the next two to seven years.”

    Burt Flickinger, Managing Director of SRG, a consumer industry business consulting firm, discussed how Walmart is winning the retail wars in an interview on Fox Business:

    Walmart is the Roman Empire of Retail

    This earnings report just reinforces its winning. Amazon is going sideways. This is a reenactment of the Punic Wars, Rome versus Carthage. Walmart is the Roman empire of retail. Like Hannibal and the Carthaginians, Amazon is starting to go the wrong way. Big win for Walmart today and they will accelerate that in the next two to seven years.

    What’s doubly impressive, we talk to a lot of vendors and shoppers around the world, what the vendors are saying is Walmart is reinvesting all the PPA (price and promotional allowances) in lower prices. Lower prices normally mean lower margins and lower revenue. But in this case, the shopper is shifting to Walmart.

    Walmart strategically saw all the land-based businesses like Payless and all the retailers from toys to sporting goods going out of business. They had great sales on land and not so good online. Walmart is winning both ways. Amazon, with all the trouble they’re having with Whole Foods, can’t capitalize. Walmart is running the table.

    This Says it All for US Retail

    This says it all for US retail. The well capitalized highly capable retailers are winning and if it’s a one man show, like Bezos running the show, you could be Alexander the Great, you could be Hannibal out of Carthage, but one general isn’t going to win a war. Recent (lower) retail sales numbers were a combination of a couple things. One is Jerome Powell scared the market, especially high to mid-end, didn’t spend as much. Also, consumers were a little bit scared toward the end of the year. Walmart, off price, low price, did very well, but full price full service struggled and that’s why the numbers were bad.

    Walmart comp sales increased 4.2 percent, just like Steve Jobs and Apple with their great campaign Think Different with Muhammad Ali, Walmart is thinking different with Doug McMillon. It’s evolved from a company of family management to professional management. Walmart had 40 percent growth online.

    Walmart Ads Are Really Connecting

    Before, Walmart looked at advertising as an expense. But as Jerry Della Femina said, most of the Super Bowl ads were pretty pathetic. Walmart was one that stood out because it advertised Walmart online and Walmart in-store. The Walmart ads are really connecting with consumers, a United Nations of consumers.

    They’re reaching everybody around the world with better prices and better service. Doug McMillon has invested in inventory and has invested in store staffing, first to raise wages with some push from the UFCW. They are hitting on all cylinders. The biggest problem now is they can’t handle all of the volume they are seeing on the weekends.


  • National Retail Federation CEO: This Is A Great Time For Innovation

    National Retail Federation CEO: This Is A Great Time For Innovation

    This is a great time for innovation,” says National Retail Federation CEO Matthew Shay. “There’s been a great increase in efficiency in the supply chain. Those gains are not going to be given back. Customers are going to continue to expect certain kinds of delivery and fulfillment opportunities that have been rolled out by retailers this year. They won’t give that up. They are going to want the convenience and they are going to expect to be able to maintain that in the future.”

    Matthew Shay, President and CEO of the National Retail Federation, says that the pandemic has made this a great time for innovation by retailers:

    This Is A Great Time For Innovation.

    Just look back a decade ago and the companies that were created in the midst of the great recession in 2008, 2009, and 2010. We saw a lot of new IPOs. This is a great time for innovation. Some of the predictions this year, for example, about the number of stores that would close or bankruptcies that we would see just haven’t materialized. Part of that is because consumers have been relatively healthy and part of that is because on a net basis we’ve seen new businesses opening to offset the closing. There’s an enormous amount of innovation taking place.

    On the issue of returns, there’s a big company located right here in Washington, D.C., Optoro, a big partner for many retailers helping them process returns efficiently. I’ve talked to senior executives at UPS today about shipping issues and there is a lot of innovation taking place. They are working very diligently and have a great delivery record so far. We are looking forward to getting all those gifts to American families. The biggest gift of all, of course, will be some additional pandemic relief.

    A Lot Of This Is Going To Be A Permanent Change

    The issue is how much of this consumer behavior has changed permanently and fundamentally? How much of us as Americans go back to our old behaviors? That’s going to play itself out. Certainly, a lot of this is going to be a permanent change. People will do more as we saw across all demographic groups, regardless of age, this entire year doing much more online. Some of that will remain sticky.

    There’s been a great increase in efficiency in the supply chain. Those gains are not going to be given back. Customers are going to continue to expect certain kinds of delivery and fulfillment opportunities that have been rolled out by retailers this year. They won’t give that up. They are going to want the convenience and they are going to expect to be able to maintain that in the future.

    With those kinds of innovations and that kind of resilience in the system against the backdrop of a year next year that could be extremely bullish if we get the vaccine rolled out, as we all believe it will be. I talked to a senior executive of one of the major pharmaceutical companies last week and they said early April or the end of May everyone that wants it will get it. We could be set up for a really big comeback for consumers next year.

    National Retail Federation CEO Matthew Shay: This Is A Great Time For Innovation
  • We Are a Marketplace That Sells Demand Generation, Says Grubhub CEO

    We Are a Marketplace That Sells Demand Generation, Says Grubhub CEO

    “We are a marketplace that sells demand generation,” says Grubhub CEO Matt Maloney. “We sell growth. That’s what our primary product is. We’re not a logistics company. We do logistics because we know that’s an end to get to restaurant growth and make money off our logistics. The gross margins on the logistics are not fabulous. The gross margins on the demand generation are fabulous which is why I differentiate between a logistics company and demand gen company. If you’re selling consumers, you’re selling growth, and you can charge a lot for that.”

    Matt Maloney, CEO of Grubhub, discusses with Jim Cramer on CNBC how Grubhub is in the business of driving growth for restaurants and is not just a logistics company:

    The American Public Has Just Adopted Digital Ordering

    This is our fifth anniversary of our IPO. The market now is ten times what I thought it was five years ago. It’s because the American public has just adopted digital ordering as their preferred way to engage with their local restaurants. We are not just marketing to Millennials. We are marketing on national television across all channels, all time zones, and hitting all segments. We just see that people realize that digitally ordering on their app or on their desktop is just easier.

    Of course, our ad campaign is working. I wouldn’t have it on TV if it wasn’t working. You think about it this way. You know your LTV, your lifetime value of your customer, once they start ordering we know that they’re lifers. They’re on forever. We can make that revenue model and then we know how much it cost to put the ad on there. So yes, over time, as people see the ad, more and more it becomes less and less effective. But we’re nowhere near our LTV.

    https://youtu.be/qpyVP-JhToc
    Grubhub National TV Commercial

    I have always been willing to be extremely aggressive investing in the future. Historically, I was bound by the amount of money I could invest. The reception of these communications just weren’t hitting the public and they weren’t working as well. Then around the third quarter of last year, we saw that we could spend way more than we had historically. I’m just talking about effectiveness. Spending it effectively. We came to the street on our third quarter earnings call and said we see opportunity and we are going long in the fourth quarter.

    Yum Made $200 million Investment – They Believe in Our Story

    People are going to say where’s the beef, the old Wendy’s commercial. They’re like show me the money. (We don’t have Wendy’s) but everyone talks to everyone in this industry. I think over time exclusivity is just not going to happen. (We have Yum) and Yum is the biggest restaurateur in the world. YUM is an incredible brand which includes Taco Bell, KFC, and Pizza Hut. They are very forward-thinking. They invest in technology a lot and they wanted to make a fundamental partnership and we wanted to understand what the brands needed from a partner.

    Yum made a $200 million investment because they believe in our story. We didn’t need the investment because we have a very healthy balance sheet. What it did it was really bringing the support of the young brand and the franchisees into Grub. As a tight partnership, we’re able to execute on technology and growth for them in a way that nobody else in the industry is doing right now. I totally disagree (that we aren’t making money from this partnership).

    We Are a Marketplace That Sells Demand Generation

    We are a marketplace that sells demand generation. We sell growth. That’s what our primary product is. We’re not a logistics company. We do logistics because we know that’s an end to get to restaurant growth and make money off our logistics. The gross margins on the logistics are not fabulous. The gross margins on the demand generation are fabulous which is why I differentiate between a logistics company and demand gen company.

    If you’re selling consumers, you’re selling growth and you can charge a lot for that. That’s the profitable side. Everyone else in my industry is a logistics company which has razor thin margins. One of my competitors said they’re the next FedEx. Do you really want to be the next FedEx? There’s the multiple that we can get as marketplaces and there’s the multiple that logistics companies can get.

    Everyone Would Prefer to Order Digitally

    I think that everyone in the country would prefer to order digitally than order on the phone. That’s why we acquired Tapingo. It’s an incredible acquisition because it gives us further scale on campuses. Tapingo is a pickup focused product. So here’s what you need to think about. We sell growth, we sell orders. I don’t care if that’s a pickup order, a delivery order, a self-delivery order, or a catering order.

    Everyone else in my industry only does delivery facilitated by that platform. Because we partner with the restaurants (which means) the restaurants are subsidizing part of our transaction fee, we are always cheaper. That’s what people don’t understand. There’s a lot of bait and switch pricing going on (from competitors).

    We Are a Marketplace That Sells Demand Generation, Says Grubhub CEO