ECOMMERCE: Late last year, Amazon reached out to us to discuss a new initiative. They were in the process of building Amazon Launchpad, a destination celebrating new products from great startups. Today, we’re teaming up with them to surface awesome new products and help makers get their goods into the hands of consumers. When it comes to e-commerce, Amazon is the leader. Their marketplace includes over one billion products globally (wow); and their ability to provide high-quality distribution and service is unparalleled.
RETAIL: There’s nothing inevitable about the level of crime at Walmart. It’s the direct, if unintended, result of corporate policy. Beginning as far back as 2000, when former CEO Lee Scott took over, an aggressive cost-cutting crusade led many stores to deteriorate. The famed greeters were removed, taking away a deterrent to theft at the porous entrances and exits. Self-checkout scanners replaced many cashiers. Walmart added stores faster than it hired employees. The company has one worker for every 524 square feet of retail space, a 19 percent increase in space per employee from a decade ago.
BRAND: Interbrand launches the inaugural Interbrand Breakthrough Brands report, in partnership with Facebook, Ready Set Rocket, and the New York Stock Exchange (NYSE). The Interbrand Breakthrough Brands report, entitled “Future Growth,” is unique in that it examines emerging companies that are brand-led—organizations that have both unique business models and strong brands. [100 Page Report Unlocked]
ECOMMERCE: Big purchases are scary to make online without anyone there to quell your fears and answer questions. Operator’s app wants to give you the same peace of mind, not with mechanical chat bot responses, but through real humans with knowledge about whatever you’re buying. Today Operator 2.0 launches with a new Discovery tab where curators assemble recommendations about their favorite products in a category, and can offer guidance about which to get.
DATA: So, for example, the data can contrast how well Oreos sell on a sunny Saturday in Seattle compared with a soggy Saturday in Saratoga. “This precise ‘rest-of-market’ outlook coupled with specific sales variables will enable Kroger and Albertsons to unlock new opportunities and relevant insights,” Hughes said. “For instance, they can overlay this real-time data with in-store displays and Twitter activity to tweak marketing tactics.” Partner manufacturers can track sales of their products using the same “rest-of-market” outlook.
BRAND: According to Carol Austin, VP/Marketing at Baskin-Robbins/Dunkin Brands, the brand's research has shown that customers want to "know everything from where the closest store is to when there's an event happening that they can participate in with the brand". The new app is an ambitious attempt to not only supply that sort of information to brand fans but also, via a Facebook login integration, give Baskin-Robbins an insight into consumer preferences and the opportunity to tie the brand to consumers' personal events.
MEDIA: Today, the company is launching its first video format as the next step in the process of building an ad business. Earlier this month, Pinterest quietly rolled out a video player that lets users and brands upload and store clips of any length straight to the site. Just like every other major tech company—namely Facebook, Snapchat, Google, Twitter and Tumblr—video is part of Pinterest's recent efforts to beef up revenue with interactive ads that typically cost more than static formats. But Pinterest claims its pitch to advertisers is a bit different from its competitors.
ECOMMERCE: Walmart’s strategy is to reach beyond its core customer. Despite its emphasis on discounts, Jet’s customers are younger, higher income (over $65,000 per year), better educated, and more likely to shop online than Walmart’s typical customers. So Walmart is not trying to get its existing customers to buy online; it is trying to expand its customer base to a different and more lucrative demographic profile. Despite its emphasis on discounts, Jet’s customers are younger, higher income, better educated, and more likely to shop online.
RETAIL: In some ways, Kohl’s has overcome one of the biggest challenges in identifying its customers: Getting them to log in while at a computer or on a mobile device. Kohl’s app has had 12 million downloads to date, and that’s helping to create a seamless shopping experience for the majority of Kohl’s customers who combine in-store and online shopping or those who shop between their desktop computer and mobile devices. The app also entices consumers to use mobile while in a physical store.
PRODUCT: If you decide you want to serve this customer that is okay! Remember that being good at customer service doesn’t mean serving every potential customer. You should always be courteous with people you can’t serve but you shouldn’t feel bad telling them that you’re focused on solving another problem. They’ll survive and you’ll be much more likely to serve your target customers better. Also, focusing in on a specific problem will help you find product/market fit. In the early days, by focusing on solving one problem really well, you’re betting on making a small amount of people very happy.
ECOMMERCE: Quality content marketing for ecommerce sites can be even more challenging. If, for example, the content is too "sales-y," it can be a turnoff. If it's too subtle, it could lead to lost sales. Marketers also can't just create a blog and check off some ecommerce content-marketing box. "Unfortunately, I'm still seeing many ecommerce businesses that think content marketing simply means having a blog," wrote Steve Olenski, a senior creative content strategist at Oracle Responsys, in a recent MarketingLand.com blog post.
ECOMMERCE: To be clear, a few digital-first brands will likely emerge as sustainable value creators. Brands with high enough average order values to overcome high delivery costs are better positioned (though Net-a-porter’s inability to make money after all these years underscores how difficult this is). Those that deftly merge online and offline experiences–think Warby Parker and Bonobos–also improve the odds (though, side-note, don’t be misled by the high productivity of their initial locations and comparisons to other brands’ productivity stats.
Last word: On The Halo Effect
The halo effect is a term used in marketing to explain the bias shown by customers toward certain products because of a favorable experience with other products made by the same manufacturer or maker. The halo effect is a concept driven by brand equity.
Issue 108 will feature an original, top 10 list of the VC-backed startups who've best achieved the halo effect. The list will be determined by number of new product segments, growth in organic web traffic, in-bound links to their online retail, net promoter scores, and any applicable statistics from Internet Retailer's databases.