The Era of Omni-Channel Commerce … and, the Marketing Evolution that Changes Everything!

By Donna M. Iucolano Founder & Principal Consultant Spinach Candy, LLC

What’s Driving My Perspective

• Digital retailing and interactive marketing professional since 1994.

• Worked in high-profile, senior executive roles starting, leading and managing digital businesses in 3 industries – gifting, children’s publishing, and women’s apparel.

• Co-founder of shop.org, the world’s largest trade association for e-commerce – now part of the National Retail Federation.

• Today, manage a strategic digital business and marketing consulting, interim management and business development company.

Your Customers Live in an Increasingly Omni-Channel and Social World … Do You?

How Close Are You?

Imagine if You Could …

Deliver relevant content that influences customer behavior to your customers and prospects based on

what they are doing that moment

where they are located

And, their history with you

This real-time interaction is what marketers have been wishing for forever.

Now .. We Can!

And, need an evolved mindset to realize it.

Omni-Channel is … Channel and device agnostic

Truly customer-centric

What today’s customer wants and expects

To be achieved by an evolution in marketing, as well as technology

All about CONVERGENCE!

Omni-Channel is More Than Multi-Channel

Once upon a time … not too long ago … it was enough for your brand to have a presence in multiple channels, both online and off-line. Those days are over!

A multi-channel strategy is about managing a series of separate touch points through various channels.

An omni-channel strategy

is about integrated touch points that together create an uninterrupted, immersive experience that is channel and device agnostic, and drives engagement, purchase, and loyalty.

What Makes Omni-Channel Different?

Connectivity, Consistency, Channel Neutrality

Leverages the always Connected Consumer

Requires an always Connected Enterprise

Lets consumers experience the whole brand, not a channel or individual touch-points

Requires consistency across all retail channels

Enables customers to start their experience via one channel / device, and continue or finish via others

Enables marketing to be more efficient (with offers relative to a specific consumer based on purchase patterns, social network affinities, Web site visits, loyalty programs, and other data mining techniques across bricks-and-mortar, Web sites, mobile, TV, catalog, etc.)

What Are We Converging?

Everything … Everywhere

Online and off-line Inbound and outbound Old media and new media Customers and technology Behavior and results Data and strategy Employees and divisions

Objective More profitable and committed

customer relationships

Omni-Channel Drivers #1 – The Growth of E-Commerce –

Worldwide and in the USA

Growth of E-Commerce in 2012

$1 Trillion Worldwide and Growing!

B2C e-commerce sales grew 21% to $1 trillion for the first time

2013 sales are projected to grow 18.3% to $1.3 trillion worldwide,

Asia-Pacific will surpass North America to become the world's No. 1 market for B2C ecommerce sales.

Sales in North America grew by almost 14% to a world-leading $365 billion in 2012 – a figure expected to increase 12% to $409 billion this year.

Despite strong growth, North America’s share of global sales will drop from 33.5% last year to 31.5% in 2013 as Asia-Pacific surges ahead.

Source: eMarketer

Growth of E-Commerce in 2012, cont’d.

Position of the USA

Online shoppers in the US spent $226 billion in 2012

The U.S. will remain the single country with the largest share of worldwide B2C e-commerce spending, at almost 29% in 2013.

The U.S. market is increasingly dependent on a strong holiday season. Consumers spent $42.3 billion online in November and December, a 13.7% increase over $37.2 billion spent during the holiday shopping season in 2011

This will grow to $327 billion in 2016 – an increase of 45% over 2012. In 2016, e-retail will account for 9% of total retail sales.

China is closing the gap fast. In 2016, China will have 22.6% of the worldwide market, vs. 26.5% in the US.

Omni-Channel Drivers #2 – The Growth of Mobile Commerce

(as a Sub-Set of E-Commerce)

Growth of M-Commerce in 2012

Mobile Commerce is Growing Rapidly; Tablet Adoption is the Driver Beating Smartphones

Customers are more connected than ever before.

Smartphone and tablet penetration has grown dramatically.

Mobile Commerce grew by 81% to almost $25 billion last year in the US alone.

Mobile devices accounted for 11% of total US retail e-commerce sales in 2012, and future growth is expected to push mobile sales to a 15% of all US retail e-commerce sales this year.

Heavy usage during holidays when customers were looking for deals.

This year, US consumers will spend $24 billion shopping on their tablets, and that figure will nearly double by 2015.

Omni-Channel Drivers #3 – The Growth of Social Networking and

the Hyper-Connected Customer

Social Media Mania

Maturing, believe it or not. Social media and social networking are growing up fast.

Almost 20 years old.

Part of the fabric of people’s every day lives and a global phenomenon.

Being driven by … More people using smartphones and tablets to access social media.

Emergence of new social media networks that catch on.

And, by simultaneous use while doing something else. While watching TV to comment about shows or to research products in ads.

While shopping (in store or online) to look for deals, coupons, reviews.

While on public transportation and in cars (regrettably).

While crossing the busy streets in New York City and elsewhere.

While in the bathroom (ugh!).

Social Empowerment = Influence

Facebook is Driving Purchase Behavior

Facebook has greatest impact on purchase behavior. 47% of Americans using social networks said that Facebook has the greatest impact on purchase behavior (up from 24% in 2011).

54% of Facebook members have used the social network via a phone, and 33% use a phone as their primary way to access Facebook

Facebook is the most addicting social network. 23% of Facebook’s users check their account 5 or more times DAILY.

Source: Edison Research

Social Empowerment = Immediate Gratification

A 24/7 Hyper-Connected Experience is Becoming the New Normal

Twitter was the fastest growing social network in 2012, but has little impact on purchase behavior – only 5%.

Users that follow brands on social media is on the rise. From 2010 to 2012 the percentage of Americans following any brand on a social network increased from 16% to 33%.

The fastest growing segment in social media is 45-54 year-olds. 55% of Americans 45-54 now have a profile on a social networking site.

22% of Americans use social networking sites several times per day

Social Empowerment = Creative Expression

Pinterest Rising

Pinterest was the darling of 2012

Most powerful, intuitive and appealing experience

Had the largest year-over-year increase in audience and time spent of any social network , across PC, mobile web and apps

Overwhelmingly female audience -- 70+%, between 25 and 54

Top Interests: fashion, entertainment, crafting, gardening, and home

Spend most when follow thru on a purchase for item first seen on social media – more than 2x Facebook ($179 vs. $80 per order)

It’s just for pinning now, but stay tuned … with their loyalty and conversion P-Commerce could be next!

Source: Nielsen and Fast Company

6 Areas That Will Impact Your Success in Omni-Channel And, What Marketing Leader Can Do

1. Marketing Philosophy

Getting beyond multi-channel to customer-centric

Most companies believe their marketing is customer-centric

The reality is they think in terms of ad hoc, channel specific marketing efforts and quick wins, low hanging fruit vs. holistic and long-term customer value.

What Marketing Leaders Need to Do:

Think Like Customers • What do they need

(even when they don’t know they need it)?

Become Silo-Busters • Be Channel &

Device Agnostic • Connect marketing

elements together to keep drawing customers in

Develop a Deep Understanding of Interactions

• Insights without

Prejudice • Create consistency

and immersion

2. Marketing Strategy

Let customers (help) define your strategy

Use insights, patterns and trends to find “gaps” of opportunity within the customer experience

Design an omni-channel strategy that complements and enhances the existing customer experience.

What Marketing Leaders Need to Do:

Research • Go beyond personas

and demographics • Know interests;

emotional, aesthetic, and functional needs

• Know the competition so you can beat them

Assessment • What’s holding you

back? • Think about assets

available, channels, team skills, partner opportunities, org structure, management

Define Goals

• Increase sales • Deepen customer

engagements • Change perceptions • Re-organization • Cultural changes

3. Customer Experience

Evolve to Responsive Web Design

Design approach aimed at creating sites and marketing efforts that provide optimal viewing experience across devices (PCs, smartphones, tablets, etc.)

Ensures easy reading and navigation with a minimum of resizing, panning, and scrolling — across a wide range of devices

What Marketing Leaders Need to Do:

Be the Customer Advocate

• See yourself as the

customer does • Stop tinkering with

existing design efforts • Showcase best

examples

Embrace Design Thinking

• Typography matters • Use larger images • Don’t be afraid of white

space • Lose the Flash • Facilitate sharing • Content is still king

Embrace Change

• RWD is flexible and adaptable

• Test and learn • Iterate frequently

4. Path-to-Purchase

The shopping funnel is dying!

Customers are bouncing around, and in-and-out of different channels, across multiple devices

Customers are being influenced by people that are in and out of their social networks

What Marketing Leaders Need to Do:

Stop Tracking Irrelevant Metrics

• Like last click

attribution • Look at total spend

and overall results

Create a New Visual • The funnel will evolve

to a spider web of sorts • How many touch

points are needed before your customer takes action?

Understand the Customer’s Entire

Journey

• Monitor key metrics and holistic performance indicators

5. Organizational Execution

Highly integrated, aligned organizational execution is needed for omni-channel success Invest time educating people, and secure buy-in from all parties , internal and

external, before starting the transition to an omni-channel approach

Internal “rewards” and “punishments” need to be re-evaluated

What Marketing Leaders Need to Do:

Educate & Lead • Be a champion for the

new approach within your organization

• Find others evangelists • Identify ownership • Highlight need for

coordination, flexibility and interdependence

Planning • Evolution won’t happen

over-night • Identify possibilities • Identify obstacles • Quantify risk of not

moving in this direction

Execution

• Keep “relevance” as the guiding force

• Fail fast and keep trying new things to succeed

• Testing budget needed

6. Data and Analysis

On-going analysis of customer interactions …

Builds on your initial customer research.

Provides an evolving picture of customer behaviors and preferences.

Covers typical metrics, and often, integrated reports using 3rd party data

What Marketing Leaders Need to Do:

Know What You Want to Track

• Raw data is not

enough • Beyond simple ROI

Accurately Capture Data from All Sources

• What is the necessary

level of detail? • Holistic look at

numbers to see how different data influence each other

Reporting

• Flexible, configurable reporting platform

• Access to up-to-date reports that enable real-time campaign updates

• Dedicate resource(s) who make analysis a priority

Companies On Their Way to Omni-Channel Success In Your Own Neighborhood

Companies to Watch

American Eagle Outfitters • $3 billion retail apparel brand for

tweens, teens and young adults • Omni-channel leader in a global

study by Kurt Salmon, the global retail and consumer goods consultancy

• Huge focus on mobile, and in engaging their young target

• Re-building entire organization from top to bottom

Walmart • Multi-national retail discount chain • $440+ billion • Focus on mobile, same-day

delivery and competing with Amazon

Companies to Watch

Sephora • French brand and chain of

cosmetic retail stores • $900 million in revenue • Carry 100+ brands plus their own

private label • Early adopter of Responsive Web

Design

Walgreens • Largest retail drugstore chain in the

USA • Aiming to be much more than our

local drugstore • Very large TV campaign touting

their efforts • $70+ billion in revenues

Final Thoughts

Omni-Channel success requires Omni-Channel Marketing which is less like a campaign and more like an on-going conversation O-CM represents a shift in “how” successful brands will approach today’s

dynamic marketplace.

O-CM is grounded in a foundation of strong brand and strong customer relationships despite its dependency on new and emerging technologies

O-CM has the power to create relevant, immersive and converged experiences that will increase customer acquisition, improve conversion, ensure retention … and build your brand!

Don’t forget to discuss your Omni-Channel Evolution with marketing partners, like Bronto – they can and will help you!

Thank You!

FOR MORE INFO: DONNA M. IUCOLANO FOUNDER & PRINCIPAL SPINACH CANDY, LLC 130 SHORE ROAD, # 240 PORT WASHINGTON, NEW YORK 11050-2205 (OFFICE) 1-516-883-0024 (E-MAIL) DONNA@SPINACHCANDY.COM