Four Trends to Consider in 2021

Ok, it’s been a year. We all feel it, I’m not going to pile on. While I’ve heard wildly different sentiments on what 2021 holds, I think we can all safely say: we’re ready for a new year.

Regardless of how quickly we start to emerge (if at all) from the shadow of COVID, we’ll all have opportunities to remake things this coming year. COVID accelerated a great many technology-focused shifts in consumer behavior. We didn’t suffer through COVID only to have things go back to the way things were. 2021 may be a better year because of our sheer determination to make it so.

Let’s have look at what’s in store (yep, wink):

A Spate of Entrepreneurs Emerge that Focus on Luxury Experience

This crisis has seen distinct winners, and these winners won big: people well-invested in the stock market, professionals who worked from home, online retailers, pharmaceutical companies, fitness equipment manufacturers and more.

As a result, it looks like a set of HENRYs (high earners, not rich yet) are about to graduate from being just high earners to being high earners with enough in the bank to feel rich. They’re flush with cash and ready to spend. I expect to see a spate of entrepreneurs offering new products, services, experiences, and investments that cater to this newly wealthy crowd.

Entrepreneurs we will see aplenty. With all the layoffs and at home work, people are looking for ways to generate additional income. New business applications (required filing for entrepreneurs) have grown by 38% year-over-year as of mid-November.

In-Person Experiences Will Be Very Important (and Flexible)

Hopefully by some point in 2021, just about every American who wants to be vaccinated will have had the opportunity. After nearly a year of staying apart, a great many of us will be starved for interaction in pubs, live events, gyms, and retail. But though we’ll crave in-person experiences, we’ll also be nervous and uncomfortable sitting cheek-to-jowl in movie theatres and concert venues as we once did. We’ll want the ability to socially distance when necessary for the foreseeable future.

There’s good reason to retain that ability: coronavirus isn’t the only global health threat. Infectious disease specialists have been warning that an array of zoonotic diseases, including a deadly flu, can emerge at any time. Retailers, restaurateurs, and other purveyors of in-person experiences are keen to ensure they’re able to function through future pandemics, and that means reconfiguring their establishments to support social distancing whenever necessary.

As we reenter the world in 2021 we will see more restaurants with walk-up windows, stores configured to support social distancing, and more outdoor spaces re-purposed for pop-up commerce events. My little town – a suburb of Seattle – recently closed some of our main streets off to traffic for a weekly Christmas market. New York City has already given over parking spaces to restaurant owners so they expand their outdoor dining. There’s a good chance we’ll see expanded or regularly scheduled transformation of outdoor spaces for the foreseeable future.

It will be interesting to see what happens with massive venues and spaces. I suspect that the owners will opt for smaller events in subdivisions of their properties. That may ultimately give rise to a new breed of niche events that cater to specific customer interests, like sneakers, resale, custom and handmade goods, and more. Commerce, like nature, abhors a vacuum.

In any case, because we’ve become so focused on digital, we are likely to require less square footage for merchandising, and will redeploy excess space as places in which people gather to socialize or pursue an interest.

Digital Component to In-Person Experiences

The pandemic increased our reliance on all things digital, and we’ll see a digital component to in-person experiences in 2021. By this autumn, people may be eager and ready to watch the World Series in the local sports bar, but they’re likely to have researched which bar they feel most comfortable with ahead of time. Technology – apps, social, web, text, etc – will enable consumers to communicate with brands and each other about availability, safety, and guided experiences to ensure smooth and comfortable brand engagement.

Already we see restaurants and stores building digital bridges within their facilities to provide hybrid experiences. Many restaurateurs invite customers to dine in their outdoor patios, but continue to require them to order their entrees and drinks via an app or digital menu. Many grocery store chains have established digital channels to allow consumers to buy online and pick up in store during the pandemic – this is a channel with sticky behavior that will continue to be invested in. As Lee Hnetinka, Founder and CEO of FastAF recently said to me (paraphrase) – would you ever go back to using a VCR?

This will all feel rather seamless to people, as digital has been sneaking into our in-person experiences for a while. Take, for instance, people who purchase nose-bleeds seats at a concert or sports events, only to watch the action on a screen. Once again, the pandemic is the “great accelerator” (thanks for that phrase, Scott Galloway).

Retail will Focus on Tech that Drives Efficiency and Lower Costs

While there have been many winners in this pandemic, it has still been one of the most challenging economic crises since the 2008 crash. Retailers and brands will meet that economic challenge by focusing on technologies that provide efficiencies and convenience to both themselves and their customers. As Americans, we have an easier time spending money on cost-cutting and cost-saving initiatives than we do on experiential and net-new customer acquisition tools. This is a shame actually, as economic downturns are a great time to invest in your customers.

While 2020 was one of the most difficult years I can remember, the solutions to the challenges we faced will define the next decade. I am optimistic we will sustain the agility and problem-solving energy we brought to this year for many to come. Happy New Year everyone!

 

Is your brand ready from the new year? Contact us and let’s chart your path to growth together.

The Responsibilities of Responsive Businesses

Thriving in an Age of Extreme Uncertainty

The retail sector has experienced quite a bit of whiplash as of late. COVID-19 has accelerated the retail apocalypse, claiming more than 190 companies to bankruptcy this year alone. Massive furloughs, brought on in response to lockdown orders, will make it harder for retailers and manufacturers to reopen quickly once it’s safe again.

Social unrest adds to the uncertainty, as people take to the streets in support of racial equality, and consumers demand that brands state their positions and their plans for achieving representative workforces. According to a recent survey, 71% of Americans say “brands have a role in responding to the issues of racial injustice and police brutality.”

As I write this, the forecasters are warning that Hurricane Laura may bring an “unsurvivable” storm surge to the Louisiana/Texas border. And it’s only the beginning of hurricane season. It’s a reminder that cataclysmic climate change adds a great deal of uncertainty for us all.

The nation is also bracing for what promises to be one of the most contentious elections in our history. Brands who weigh in face the threat of significant backlash and retaliatory boycotts. Will the election go off without a hitch? Will COVID prevent many voters from heading to the polls, and if so, will that add to fury over the outcome? If yes, how will that affect the retail environment?

Preparing Your Responses

Everyday something positive and something negative occurs in the world, and there’s pretty much no excuse for brands to sit on the sidelines when their customers want to hear their voice just because those brands don’t know how to respond.

We’ve seen brands of all stripes respond to COVID, issuing statements in support of healthcare workers, and urging folks to wash their hands or wear masks. Some even pivoted their manufacturing processes to produce PPE or disinfectant. We’ve seen all brands respond to #BLM, some giving their response through initiatives like #PayUP.

Staff at AdAge started a blog that tracks how brands are responding to racial injustice.

Some responses have been better than others. Some have been sublime, like the Nike ad that asked viewers to stop pretending there’s no problem in America, and altered its famous tagline to, “For once, don’t do it.”

When it works well it’s not by accident. The brands that have nailed the right tone and message have thought long and hard about the mission and vision that drive everything they do, and craft strategies to support both of those things. The focus goes beyond responding to world events or current topics of conversations. Their missions and visions inform the way they design new products, offer them to the market, and speak to their customers individually.

Their mission and vision drive their identity, and it’s well worth emulating that approach. Note that I say it’s worth emulating their approach to hyper focusing on their identity and not their actual tactics. Your mission and vision is different from Nike’s, your tactics might have to differ as well.

Scenario Plan Your Identity

Your brand identity carries you through the highs and lows of the market and society. You need to understand your identity in times of jubilation — as when America elected its first African American President or when Chelsey Sullenberger safely landed a passenger plane in the Hudson River. And you need to understand your brand’s identity as it responds in times of tragedy, crises, strife or grief.

What does scenario-planning based on identity actually look like? How do you go about it when we really don’t know what humankind or nature has in store for us? Of course we can’t know what’s coming down the pike, but we do know that events can fit into several buckets — national crisis, heroic feats — and that gives all of us a chance to ask ourselves: how should we respond?

Tone is critical here, and you need to determine the voice that most reflects your mission and vision. If you’re a “can-do” brand like Nike, you may want to strike an inspirational tone during difficult times. If you’re a brand that values shared experiences, you might want your tone to be light and hopeful when the world is in a dark place as a remembrance of happier times.

What’s important is to develop a plan of attack for every type of scenario — joy, jubilation, tragedy, crisis. That plan should be a solid understanding of what your identity is, and the best tone to take ahead of time. You’ll also need to identify indicators that tell you it’s time to put out a statement in response to an event. If you’re a Carhartt type brand whose mission is to offer rugged clothes to workers in dangerous jobs, a statement may be warranted when coal miners are successfully rescued from a collapsed mine. Your indicators are specific to your brand and customers, and driven by your mission and vision.

Don’t Lose Sight of Your Identity

Your identity is driven by your vision and mission, which is likely to be extremely stable, but not inflexible. Reformation may be necessary if the trends and events alter your universe in significant ways. (The Constitution may be “perfect,” but it still needed amendments/a Bill of Rights.)

That said, no brand should ever lose track of its identity. It’s interesting to me that some of the brands that have recently declined significantly or even gone bankrupt are those that lost track of their identity. Take, for instance, Ralph Lauren. For 30 years RL was the definitive lifestyle brand, one that many others tried to emulate. But the company began to lose its way once consumers moved on from the lifestyle Ralph Lauren offered. It also expanded into too many categories which diluted the vision. Once, the name Ralph Lauren invoked scenes of living the good life on a safari holiday. Today when I hear the name I think of cheap sheets in Macy’s. They’re not alone. JCrew, The Tailored Group have all suffered similar crises in identity, and have gone bankrupt recently.

Normally, bankruptcy isn’t the same as certain death. These brands may rise again, recovering sales lost to newer brands and re-engaging their customer base. Or they may not. One thing I know for certain is that they need to reestablish who they are and then “overplan” for the future based on that identity.

The year 2020 has been uncertain to say the least. If you’re looking for advice on how to be more responsive with your marketing, reach out to us, we’re here to help.

It’s All About P2P

We’re at an interesting time in human history. On the one hand, we’re donning face masks, erecting plastic barriers, and disinfecting our hands after any personal interaction. At the same time, we’re in the streets demanding that racial barriers come down once and for all, and to state unequivocally that every African American is a unique individual who matters greatly to our country.

We can’t deny that we’ve lost the things that have traditionally allowed us to be personal — touch, being face-to-face, civility — at a time when we need them most. We’ve seen brands respond with compassion to COVID-19 and to the Black Lives Matter movement, releasing statements of support, manufacturing PPE and respirators, and donating to African American advocacy groups.

But your work isn’t done. You still have another role to play, and that is to make every one of your customers feel as if they are a valued and unique individual. The commodification of the customer needs to end. Customers are more than a lifetime value number or an average basket size, they’re moms and dads, daughters and sons, and people with hopes, ambitions and challenges to overcome.

So let’s forget about the B2C, B2B and D2C business labels for a second and concentrate on the model that’s truly important right now: P2P, or person to person.

Customers Are Onto Mass “Personalization”

Over the past decade tech companies and pundits have boasted about the ecommerce industry’s ability to deliver personalization at scale thanks to AI, recommendation engines of every stripe, chat bots, programmatic advertising with dynamic creative optimization and the like, but the consumer isn’t buying it.

It turns out, people have a different definition of what personalization means. According to the 2020 Gladly Customer Expectations Report, consumers want to be known by their name, and they resent when they’re made to feel like nothing more than a case or a ticket. In fact:

  • 79% say personalized service is more important than personalized marketing
  • Only 36% of customers say brands make them feel like unique individuals
  • 84% of consumers say they’ll spend more money, and go out of their way, to shop with a brand that provides them with great experiences.

 

What makes people feel like a person rather than a ticket? Sixty-six percent of consumers told Gladly that they feel human when a brand knows them, either by name, or as a shopper from a specific location. Fifty-six percent say they feel like a person when a brand can recall and acknowledge past conversations, and 55% say it’s when the brand acknowledges past purchases.

Technology can go a long way in driving efficiency in interactions with customers, but it can’t provide the personal touch customers want most. This is why I believe P2P is where retailers and brands need to focus their attention over the next 12 months. Nothing will make your customers more loyal or appreciative of your brand than for you to demonstrate a better understanding of their feelings and needs.

B2B Gets it Right

I find it interesting that ecommerce puts a lot of energy into designing B2C sites that are captivating and inviting, and yet when it comes to emphasizing the personal relationship, those sites don’t come close to B2B.

B2B sales have always been about the personal customer relationship. A building supply company knows that its customers need efficiency and reliability above all else. Their livelihoods depend on it. So they explain their products and their guarantees one-on-one. And they build sites that make it easy for their buyers to place orders in bulk, pay via their preferred payment options, display negotiated pricing, accept orders via spreadsheets, and allow them to place repeat orders in just a few clicks. These sites display an inherent respect for their customers’ time and business.

B2C hasn’t done nearly as good a job of understanding the customer. The industry has created very efficient systems for selling. We’ve optimized ecommerce funnels and store layouts and streamlined the checkout processes, but do you even know who’s buying from you? Or why? Is there a better way to build that relationship other than bombarding their inbox with general emails or retargeting them with ads for products they’ve already purchased when they go to check the weather?

Right now, customer interactions are all about closing the sale, right then and there. Sites deploy a host of tactics, aptly called dark patterns, that seek to coerce consumers into buying, regardless of whether that’s the right choice for the consumer at that moment in time. They “create urgency” by telling consumers there are just a few of those items left in the warehouse and other shoppers are looking at it. And they engage in “confirm shaming,” a tactic in which consumers must agree they’re losers in order to close a pop-up window. They sneak things into the cart and hope the customer doesn’t notice and so on.

What if all brands became more like B2B, and adopt a long-term view of their customers and the relationships they can have with them? If they viewed each shopper as someone to whom you could sell over the long haul, rather than attempt to close the deal at hand using whatever tactic possible?

Now is the Time for One-to-One Selling

Now is an ideal time to begin selling one-to-one, to introduce post-purchase, and even pre-purchase opportunities for customers to connect with one of your customer experience team members in a more engaged way. There are some great brands that are doing this really well today.

Take Parachute, a home and bedding store that invites shoppers to work with a styling consultant who “visits” their homes via a video app in order to recommend colors, styles and products that actually match the consumer’s home.

It’s the antithesis of those email newsletters we all receive that promise stuff, “you’ll love,” when, in fact, nothing could be further from the truth.

King Arthur Flour is another great example of a brand that knows how to do personalization. On the one hand, its site sells baking necessities and bakeware. But it also offers plenty of recipes and step by step tutorials that teach critical baking skills to home bakers. And if a dough doesn’t rise or have the same consistency as the one in the video, bakers are invited to call the King Arthur Baker’s Hotline for assistance. Calls aren’t answered by reps who have little experience in baking and who read canned answers, most of the reps have culinary degrees and have worked as professional bakers, chocolatiers, and chefs before coming to King Arthur. Recently, Eater magazine described how the hotline became a source of comfort during the quarantine, soothing customer anxieties that went beyond their buttercreams not mixing properly, like when they’ll be able to hug their grandkids again.

What I like about King Arthur is the way the brand views customer service as a revenue generator and not a cost center to be optimized and automated. By maintaining a staff of highly qualified experts to dispense baking advice in their customers’ hours of need, the company is ensuring those customers succeed at their baking projects, and that success makes them inspired to try bigger and more ambitious projects.

T-Mobile made a commitment to provide every customer with a dedicated customer service team so that callers wouldn’t need to repeat the background of their issue every time they reached out. When I had an issue I had the same rep answer my call three times in a row and it was great. I absolutely received the kind of personalized attention that makes me feel glad I had chosen them as my wireless provider. I haven’t had that level of service of late and I miss it.

Touch Someone

I firmly believe that brands should begin implementing P2P practices today. That means a few things. First, it means doing things like calling customers after they’ve made a purchase to see how things are going for them. Is the product living up to their expectations? Do they have questions? What would they like to see improved? Would they recommend it to a friend? Customers don’t need to take the calls if they don’t want to, but those who answer will be overwhelmed by the gesture. Such calls are exactly what makes them feel like people, not tickets or cases.

Sales associates who work in retail outlets should be empowered to spend more time with customers, even if it means some other task needs to wait until a shopper has had all of his or her questions answered. Associates need the freedom to step away from whatever they may be doing, and to be cross trained in assisting customers. If your brand sells automobile tires, make sure your sales associates have actually gotten their hands dirty changing one so that they know what they’re talking about when advising in-store shoppers. In a best case scenario, the associate should head out to the parking lot to help the customer change his or her tires right then and there.

Plexiglass, masks, and social distancing will remain with us for the foreseeable future, but those things don’t bar us from looking a customer in the eye and talking to them about their lives. There’s no better way to get that consumer back into your store, or recommending your brand to their friends and family then making him or her feel like a valued human being.

Finding Freedom Through Boundaries  

Due to the quarantine, all people who can work from home have been told to do so by stay-at-home orders. For many it’s the first time they’ve had to work from home for weeks on end. A lot of people like it, but others are struggling, especially if they share their homes with spouses and children who also need a place to collaborate with colleagues, teachers and classmates.

It’s easy to focus on work while in an office because, well, it’s why you get up early, shower, and commute to the office five days a week. Home is way more multidimensional, and that means distractions abound. It takes some effort to concentrate on lining up sales calls or proofreading a report when the dog is barking to be let out or dishes are piling up in the sink.

I’ve worked from home for the past five years, and I can tell you it requires some tactics and strategies to be successful at it. This blog is to share what I’ve learned, especially when it comes to setting boundaries. Of course, boundaries differ from person to person, but the need for them doesn’t.

If you find you’re unable to keep track of what day it is, or to get out of the work zone so you can be fully present with your family or roommates read on!

Formalize Your Workspace

Formalizing your work life within your home will help you avoid one of the biggest pitfalls of working from home: working all the time. Most of us have a bottomless pile of work we can do, and it’s all too easy to just keep plugging away. But you need downtime, and establishing boundaries is the best way to ensure you get it.

Start Early

Now that you no longer need to commute to the office, start your workday earlier. An earlier start time will give you space to get your job done and catch up if you fall behind for some reason. It’s no fun to miss happy hour with your roommates or dinner with the kids because you can’t finish your work until 8:00 at night. Early can mean different things to different people, but you’ll know what feels early to you.

Formalize Your Work Mindset

Everybody has a set of habits that puts them into a work mindset — wearing more formal clothes, blow drying their hair rather than pulling it back into a ponytail, cleaning up their desk at the start of the day, drinking coffee as they read industry newsletters. It’s important to keep up with those transitions so that you can psych yourself up for a productive workday. You may need to come up with some new transitions if your old ones are no longer applicable but be sure to do so because they’re important. You need some kind of demarcation between work and home life.

Another component to that is work hygiene, by which I mean, you need to create a space that you’ll use only for work while you’re in lockdown. If you don’t have a separate home office your kitchen table may seem an obvious substitute but beware. If it’s also where you plan family meals, read your favorite blogs, and strike up spontaneous conversations with your kids it’s likely to be a source of constant distractions and stress. Carve out a place in your house to serve solely as your office cubicle and make sure everyone in your household knows that when you’re there you are at work.

Another trick I use is to put physical reminders that connect me to the Something Digital headquarters in New York City. For instance, I have a photo of the Brooklyn Bridge and a map of New York hanging in my office, along with a bunch of other things that make me think of work.

Finally, be wary of making yourself too comfortable now that you’re no longer in the office. That includes changing fully out of your PJ’s before you hop onto your Zoom meetings. Formal from the waist up doesn’t cut it, and not just because you may embarrass yourself in front of your colleagues. Clothes help us define the roles we need to play at any given moment.

Personally, I’ve always put on work attire during office hours and change out of them at the end of the workday. You don’t need to go to that length if you don’t want to, but some kind of clothing adjustment will help you mark the difference between work hours and home life.

Create the Right Auditory Environment

Don’t overlook the auditory environment of your home office. I know a lot of people who keep the TV or radio on whenever they’re at home, but what works as white noise while you’re cooking dinner or dusting the living room will be a distraction when building a spreadsheet. Be sure to create in your home the auditory environment — silence or music — that helps you concentrate while you’re doing your office work.

Take Smart, Regular Breaks

Don’t be afraid to take breaks daily — they’re good for you and they help you concentrate. But be smart about it. A break isn’t picking up your iPhone to see what’s happening on Twitter (that’s a distraction). A break is pouring yourself a cup of coffee and sipping it somewhere other than your workspace. For me, a break means throwing a ball for our dogs or jumping on the rowing machine for five minutes. Don’t worry about setting a specific time in the day for your breaks. Breaks work best when they’re between different tasks or projects and you want a mental reset.

Don’t Overdo it with Multitasking

If you’re working from home for the first time you may feel the need to multitask more than you normally do but resist that temptation. We all need uninterrupted time to concentrate on a project or complex task. In an office, we can signal to our colleagues that we don’t want to be disturbed simply by closing our office doors. We don’t have the luxury of those visual clues at home, so we need other strategies. It’s okay to turn off your email notifications, put your mobile device in another room, or set your Slack to Do Not Disturb in order to carve out time to concentrate.

And speaking of doing more than one thing at a time: don’t keep snacks at your desk. In the office you’d never open a family-size bag of chips and chow down on them out of fear of becoming the brunt of office jokes. Don’t do it at home either because it’s all too easy to eat the entire bag when you’re in the zone.

Invest in Yourself

As I said earlier, you probably have an unlimited amount of work to do, and it’s very easy to fall into the trap of working all the time. One way to counteract that tendency is to set some goals that are outside the scope of your job, whether that’s tackling a home project you’ve been meaning to do for years or preparing healthier meals for you and your family.

We all have books we’ve been meaning to read or online classes we’ve wanted to take to advance our careers. Now is the perfect time to cross a few of those things off your list. Working towards a goal or two is a great way to invest in yourself, and to remind you that there is more to life than your job.

The other benefit of setting goals is that when you work from home, it’s really easy to divide your day between work and veg. And while vegging is absolutely a fine way to spend one’s time, it’s very easy to overdo it. Working towards a goal will prevent the guilt we all feel when we waste too much time or squander opportunities. And it will make those times when we do allow ourselves to veg feel all the more pleasurable.

Invest in Others

You may be working from home, but you’re not on an island. You need to find a way to continue telling those jokes or stories to your work buddies and eating lunch with your teammates.

In an office it’s very easy to invest in your colleagues. You can walk over to her desk to help troubleshoot a line of code or ask the three people in the breakroom which design they like better. And they, in turn, will stop by your desk when they want your opinion.

Continuing those investments from a home office requires you to be a lot more intentional about it. You need to actively say, “hey, I think Brad would really like this quote from this article, and I’ll share it with him now.” It also means being generous with your acknowledgments when a colleague helps you out and being transparent about what’s on your mind.

Fortunately, technology makes those investments really easy. You can post articles, videos and memes to a Slack channel, or schedule a Zoom lunch. (I know a group of friends who had a dinner party by cooking the same recipe and then jumping on Zoom to eat it together.)

To be sure, technology allows us to do our basic jobs from home, but it also allows us to recreate those vital connections that make us feel human. Don’t worry about being annoying (it’s up to your colleagues to decide when to read your stuff).

I think we err on the side of not reaching out via technology because it feels like an interruption, but you should trust that your colleagues have developed ways to tune stuff out when they need to concentrate. When they do get the time to read the articles or watch the videos you sent, they’ll be glad you took the time to think of them.

Enjoy Yourself

This may seem a bit odd given the current situation but now is the time to nurture joy. The quarantine has given us something we’ve always wished we had: ample time so spend with our loved ones. Enjoy the time you have to be at home because we may not have the opportunity to spend this much time with them again. We should celebrate it.

In my mind, John Krasinski personifies this spirit. A few weeks ago he decided to host a nationwide prom night for all the seniors who’d miss out on this rite of passage as a result of our need to practice social distancing. I got a lump in my throat watching how entire families put on their finest threads and listened to Chance the Rapper and a host of other A-listers perform live at these home-based proms. We see these acts of generosity and creativity all over the world, and they’re unbelievably moving.

Be a part of it. If your roommate can’t go home to see his family, find out from his mom what his favorite meal is and cook it for him. Join the millions of people who step outside their doors to applaud the first responders and healthcare workers on the frontline of the fight against the disease. These are extraordinary times, and people are responding in extraordinary ways. Dive headfirst into that joy. Do you have other tips and tricks that you use when working from home? Share them with us!

QA

How to Define your Tech Stack Strategy

Most people expect blog posts and articles about selecting an ecommerce tech stack to provide answers, yet this one will ask far more questions than it will provide answers.

I say this because every business is different, and not just in terms of products or services sold. An organization’s level of maturity, its availability of time and resources to dedicate to an implementation, and its existing systems have a tremendous impact on how to approach the project. If any vendor or agency tells you they have a foolproof template for building a tech stack for businesses just like yours, run for the hills. If you engage with a company that makes such claims, you will inevitably waste a lot of time and money on a project with a high chance of failure.

There’s no getting around the fact that launching or upgrading your ecommerce tech stack requires you ask many questions both of yourself, and of the tech vendors, consultancies and agencies you’ll tap for help.

Let’s start with the basics: what exactly is an ecommerce tech stack? Obviously, the entire world defines it as the collection of products and services that make up your commerce activities, but I no longer believe that to be accurate. A company can have a fantastic collection and still have a tech stack that’s an utter failure. It behooves us all if we redefine it as the partners that power your commerce system.

Select Your Tools

There’s a huge array of tools available to support your ecommerce platform, and another avalanche of them coming to market in the next 12 months. Here are your options, overwhelming right?

So how do you decide which ones are first necessary, and second, a good fit for your business? Here’s where all that questioning comes in.

Know Your Level of Commerce Maturity and Pick Partners that Match It

What do I mean by commerce maturity? It’s the complexity level of business solutions that your business should be employing.

Before you even begin to select partners and technology, you’ll need to assess the level of complexity you’ll need to deploy. How much time do have available to dedicate to this project? How much talent do you have within your organization? How much time does your internal talent have to dedicate? What other projects are they working on? How much budget do you have? What other technologies already exist? Which ones will you need to integrate with your new ecommerce tech stack? Do you have the resources to do that integration?

If you don’t know the answers to these questions you’re far from alone; most companies don’t. A good start is to take an inventory of all the solutions that already exist within your walls. If you don’t have a PMI system, then you probably are at a low level of maturity. That’s not an insult or a bad thing; it’s a guidepost to help you choose wisely. You don’t want an overly complex ecommerce stack if you don’t have the resources and skillset in house to manage.

Know Your Customers’ Expectations

You can’t really assess your maturity level unless you have a good handle on your customers’ expectations. Of course they all expect you to be able to take and fulfill an order, but do they expect you to have live inventory on your site? Do they want a branded shipping experience? Do they want personalized recommendations from you? Do you have the right set of tools to aid in shopping? Do your customers need visual search tools, for instance?

Answering these questions may require a variety of efforts, from market research and competitive analysis to compiling data from your customer service teams. And you should probably plan to spend some time talking with your customers.

If you’re feeling a bit overwhelmed by the breadth of these customers, keep in mind that most companies find it difficult to objectively assess how mature they are. You may want to appoint someone in your organization to ask those difficult questions, and if no one is available, find an agency or consultant to help you.

Pick the Right Agencies and Consultants

Chances are high that you’ll hire an agency or consultant to help you make sense of your needs and help you design your tech stack. It’s an important hire, one that can have long lasting consequences. The number one question you should ask yourself: do you trust this agency or consultancy?

Once you decide that you do trust them, other questions you must ask include: How mature are the other merchants in their portfolio? Are they thought leaders, putting out content that advances the industry? Given that just about every agency has a set of companies they recommend, ask yourself: How mature are the software companies they recommend? Obviously, if they’re not as mature as your company, you won’t get a lot of strategic benefit from them. Conversely, if they’re way more mature, you can find yourself buying a lot of expensive software from partners who are just out of your reach.

Let’s assume you decide that an agency or a consultant is the right fit, you need to ask: Do they have an offering or a way to partner that’s going to help you get to the next level of maturity?

Select the Partners Not Vendors

First and foremost, don’t just buy products or services, select partners, which is to say, companies that are committed to your success, and will work to ensure it. There is a huge difference between buying software from a vendor and partnering with a provider for a solution on which your entire business depends.

So how do you distinguish a vendor from a partner? Partners should be eager to educate you, and willing to explain their technology in ways that are meaningful to you and they should pick up the phone if you have an issue. Of course, many of the tools can be managed with self service but a lot can’t, and if you experience an issue with a mission critical component of your tech stack, you want a partner who understands the urgency of the situation.

They should be able to help you make rational choices. For instance, can they clearly and accurately tell you the resource allocation required to properly leverage their product? Do they have an assessment of their solution’s total cost of ownership? And of course, what level of customer service do they provide? Those are 3 key things that will help you understand whether or not you should engage with them.

Leverage Your Partner’s Pre-existing Relationships

Finally, if you decide to use an agency to help, consider leveraging their pre-existing stacks and relationships to the fullest extent possible rather than adopt net-new products. In technology, familiarity = efficiency.

In other words, if using an agency to assist with your ecommerce using the stuff they’re already good at is going to be good for you. You’ll also get better support, possibly discounts, as well as access to additional resources if your agency has a good relationship with those companies.

I told you this post would ask more questions than it answered, and I kept my promise. But within these questions there is methodology that will help you make smart decisions about your ecommerce tech stack and set your company up for continued success.

Chart and Arrows

25% of Your Online Sales? 100% Necessary: Your Amazon Playbook

If you are one of those merchants who’s still not selling on Amazon, or you are but haven’t yet checked into all the services they offer sellers, this blog post is for you.

The Case for Selling on Amazon

You might think of Amazon as your competitor, but that isn’t necessarily the case. With the right strategy in place, Amazon can be a vital strategic partner, as my colleague pointed out. Consider that in 2018, Amazon accounted for 49% of all online retail transactions, and an astounding 5% of all retail sales full stop.

Here is where things get interesting: about half of all products sold on Amazon are from third-party sellers. If Amazon is 49% of all online transactions, and half of those transactions are from folks like you, it means that about 25% of online transactions are from third-party merchants selling on Amazon. Put another way, 25% of your market potential online is through Amazon. And as mentioned in a previous blog post, for many consumers, Amazon is the first, and often only, step in their product discovery process, and if you’re not there, you have no hope of ever getting their business.

And key markets just love their Amazon Prime. According to a Business Insider survey, 44% of millennials would rather give up sex than quit Amazon for a year, and 75% would rather give up alcohol.

Step 1: Do Your Research

Amazon offers a ton of services to help third-party merchants sell and thrive on its marketplace. In fact, the breadth of services can be overwhelming, which is why we recommend spending some time reading about the options and making choices about what’s right for your business. Some merchants may benefit from engaging a consultant who has expertise in Amazon to help choose which services will best compliment their business goals.

For instance, what percentage of your business should come from the Amazon marketplace? If you’re getting an abundant amount of sales through the site on a daily basis it may be tempting to focus your efforts there. But what happens if something goes wrong with your Amazon account, or if it is deactivated for some reason? You need to know upfront the level of support you can expect from Amazon (and ensure they’re on the same page).

Step 2: Set Up Your Amazon Account

Generally speaking, merchants are either third-party sellers (Seller Central) or first-party sellers (Vendor Central).

  • Seller Central (3p): Amazon provides a turnkey web interface that allows merchants to market and sell products to Amazon customers (i.e. sell via the marketplace)
  • Vendor Central (1p): Amazon acts as a full-time distributor of your products, buying and storing inventory and taking care of everything from shipping and pricing to customer service and returns.

 

Account Types

You’ll also need to determine an account level. There are fees associated with selling on Amazon, and sometimes they give merchants pause. Don’t forget: there are always costs to do business, and while at times Amazon fees can seem high, consider the cost of selling through other channels. When considering TCO, you may find that it’s actually less expensive to sell through Amazon.

  • Professional: $40/month + fees
  • Individual: $.99/sale + fees

 

Fulfillment Options

Finally, select your fulfillment option. Fulfillment is one of Amazon’s strong points, and the company has built massive infrastructure to get packages into the hands of shoppers in a timely manner. It is a pay-as-you-go model. If you use Fulfillment by Amazon (FBA) your products are available for Amazon Prime.

  • Fulfillment by Amazon (FBA): Your products are in Amazon’s fulfillment centers, and Amazon will “pick, pack, ship, and provide customer service for these products.” Fees are on a per package basis, determined by size, there are also warehouse storage fees. Amazon offers a fee calculator to help determine your costs.
  • FBA Onsite: You store your products in your own facility, and Amazon reps pick, pack and ship it for you. Eligible for Prime and Subscribe & Save. Amazon fulfillment fees but without the storage fees.
  • Fulfillment by Merchant (FBM): You take full responsibility for  storing and packing and shipping orders. There are no fulfillment fees.
  • Seller Fulfilled Prime: Sellers deliver directly to domestic Prime customers from their own warehouse. By displaying the Prime badge, you are committing to fulfill orders with Two-Day Delivery at no additional charge for Prime customers. Amazon gives you access to the right transportation solutions to help you meet the high bar for the Prime customer experience. Note: There is a waitlist to join this option and participation requires sellers to use Amazon Buy Shipping Services for at least 98.5% of orders.

 

Inventory Management Tool

Amazon has built some great tools for managing your inventory, such as an Inventory Dashboard, and Inventory Performance Index, which measures inventory management over time, including how well you balance inventory levels and sales, fix listing problems that make your inventory unavailable for purchase, and keep popular products in stock.

Step 3: Produce Discovery, Promotions and Advertising

Amazon provides a range of options to feature your products and brand to help you win customers and generate sales. For instance, you can create special offers for sale on Amazon, your site, or your stores only (for FBA participants only). These are powerful tools because Amazon goes out of its way to get your offers in front of its customer base, which is why an additional 5% fee is applied across your entire account. So if you sign up for these programs, make sure you take advantage of them.

  • Amazon Exclusives Program: The Amazon Exclusives Program is one way the marketplace can help you acquire new customers. Amazon describes it as, “best destination for innovators to launch and build a brand by providing increased brand discoverability, marketing opportunities, and self-serve brand tools.” Don’t be put off by the name of the program, Amazon defines “exclusivity” as “selling through Amazon, your own website, and your own physical stores.” This can be a on a per product basis, or even unique variations on an existing product.
  • Amazon Deals: Amazon offers many deal options — Today’s Deals, Lightning Deals, Savings and Sales, and Coupons. If you haven’t yet applied to be included in Deal of the Day, do so immediately. Lightning Deals are now a consumer sport, with numerous shopping blogs offering tips on how to snag them. To participate in a Lightning Deal, you and your products must meet specific Amazon criteria.
  • Sponsored Products: Sponsored Products is Amazon’s PPC advertising service that helps sellers promote the products they list on Amazon. You select the products you want to advertise, assign them keywords and enter a cost-per-click bid. Then, when an Amazon shopper searches for one of your keywords, your ad is eligible for display alongside the search results. You’re charged only when an Amazon shopper clicks your ad, at which point the shopper is taken to your product details page.
  • Sponsored Brands: Formerly known as Headline Search Ads, Sponsored Brands are keyword-targeting, cost-per-click ads that allow brand to promote custom headlines, their logos, and images, and drive traffic to their Store or a curated page that showcases their brand and products on Amazon. Why should you invest in Sponsored Brands ads? From 2015 to 2018, Amazon surpassed Google for product searches, with Amazon growing from 46% to 54% and Google declining from 54% to 46%. And it’s still in its early days yet.

 

Step 4: Evaluate Additional Amazon Services

Ever notice how the arrow in the Amazon logo points from A to Z? That’s not an accident. The company has always sought to provide everything a person may need.

The same holds true for its sellers and a host of other business entities. Amazon offers a mind-boggling array of additional services, some for use on Amazon.com and others for anywhere else on the web. Some of these services, like Brand Registry, I consider must haves, others are beneficial for specific types of merchants and sellers.

  • Brand Registry: Amazon Brand Registry helps you protect your intellectual property and create an accurate and trusted experience for customers on Amazon. It’s software proactively removes suspected infringing or inaccurate content. This is one of the services I think all vendors should use.
  • Amazon Business: Amazon Business is a B2B service that allows businesses to sell and purchase supplies from one another. There’s no fee for joining, and members get access to quantity discounts, tax exempt purchasing, business-only prices, among other perks.
  • Amazon Handmade: This is an artisan-only community for selling handmade items to Amazon customers. Participants can take advantage all other Amazon programs, such as FBA, and promotions.
  • Amazon Custom: Amazon Custom is a store on Amazon.com, where shoppers go to customize your products with their text, images/logos or from a list of options that you provide. Custom products are cross-listed in our store as well as in your specified department.
  • Amazon Multi-Channel Fulfillment: Amazon’s Multi-Channel Fulfillment (MCF) offers access to Amazon’s fulfillment network, operational expertise, and trusted shipping options for all of your orders, from wherever they’re placed—both on Amazon.com and on other sales channels.
  • Amazon Web Services: AWS provides on-demand cloud computing platforms to individuals, companies and governments, on a paid subscription basis. The technology allows subscribers to have at their disposal a virtual cluster of computers, available all the time, through the Internet.
  • Amazon Pay: Amazon Pay is an online payments processing service that lets Amazon customers pay for item on external ecommerce sites, using the payment (credit card and address) stored in their Amazon account.

 

Parting Thoughts

Before I leave you in this post, I would like to take the opportunity to address some concerns about selling on Amazon that many sellers have shared with us at Something Digital.

The first concern is data. When a customer purchases your product via Amazon, obviously Amazon has access to their customer’s data, including search history, other products looked at, name, address, credit card information, and so on. What’s to stop Amazon from using that data about your customer for themselves or for your competitors’ benefit?

Consumer data is one of the hottest commodities in commerce, period. Should this stop you from selling via the marketplace? In my opinion no. Amazon already has all the data they need and if they don’t they will soon. It’s one of the perks of having the largest assortment of products online.

And consider this: Let’s say your products fall into a unique category that’s not sold on Amazon currently. You withhold your products from the marketplace, but will your competitors? Likely not. So unless you trust all of your competitors not to sell on Amazon, they’ll get to the 300+ million customers on Amazon before you.

Finally, as huge and as important Amazon is, it isn’t the only marketplace in the world.  Walmart, Jet and Alibaba are huge marketplaces, and you should plan strategies for them as well, lest you miss out on those opportunities.

Amazon _ You Me And Amazon Graphic

Is Amazon Your Competitor? Not if You Have the Right Strategy in Place

It’s hard to talk about online retail without the conversation winding its way back to Amazon. With 44% of all online sales, and 4% of total retail sales in the US1 , Amazon is the elephant in the room. But that doesn’t mean online retailers are at a disadvantage. It simply means you need to make Amazon’s existence work to your advantage. In fact, Amazon has several programs to help you do just that and more than 40% of Amazon’s total unit sales come from third-parties2.

Product Discovery on Amazon

An Amazon shopper is someone who prefers to shop in one big, online market place where everything from jeans, to s shoes, to a dog bed, to batteries can all be ordered at once and shipped within a day. Fortunately, this type of customer can be yours as well.

For loyal ecommerce customers, product discovery begins on Amazon. It’s the first place they will go whenever there is a need or want.  In turn, Amazon is a great way to grow your business by getting your brand in front of millions of consumers. When an Amazon shopper is looking to fulfill their needs or wants, why not have your best-selling ones included in the Amazon search results?

You don’t need to offer your entire catalog on Amazon. Many brands offer their evergreen and classic styles there in order to build brand awareness.  Rather, they reserve their complete catalog and newest styles for their ecommerce site. For these retailers, Amazon serves as the first point of contact, and they use that sale to promote their own ecommerce sites by inserting marketing materials or special onsite offers in the packaging (more on packaging later).

Tip: Something to keep in mind – Amazon wants to be the place where consumers get a wide selections at lower prices. You can prevent a race to the bottom by establishing a minimum advertised price (MAP), which bars any outlet from selling your products below that minimum.

From Product Discovery to a Holistic Strategy

Let’s start by defining what a holistic strategy for your business, which should be to offer a portion of your products on Amazon. In other words, you’re managing a marketplace channel, just as you would a reseller, wholesaler or brick-and-mortar channel. If you’re new to the Amazon marketplace, you probably fulfill your orders yourself.

Once you begin to gain some traction and begin reaching new customers, it may be time to consider the Amazon customer’s expectations. In the US alone, there are 90 million Amazon Prime subscribers — people who are accustomed to fast delivery of orders. Slow delivery can affect your Amazon Seller Rating, a metric that measures overall customer satisfaction of your buyers, and help you identify customer service improves that can lead to more satisfied buyers. A straightforward way to improve your Seller Rating is to join the Fulfillment by Amazon (FBA) program. This program means that Amazon will warehouse your products and fulfill them on your behalf. There are fees, of course, but you get a lot of advantages. For instance, your products are eligible for Amazon Prime free two-day shipping, and your product listings are displayed with the Prime logo, telling all those diehard Amazon shoppers that Amazon will handle all packing, delivery, customer service and returns.

If you sell products that are common or widely available, you can opt into Multi Channel Fulfillment by FBA – a program where  in which Amazon already warehouses those products, but you serve as the merchant of record. Because the products are already in the Amazon warehouse, this arrangement is a de facto dropshipper relationship. Dropshipping is a retail fulfillment method in which you don’t keep any of the products you sell in stock. When you sell a product, you buy it from a third party — in this case, Amazon — who then ships it directly to the customer. As a result, the merchant on record, you never see or handle the product. This program is intriguing because you can build your store’s brand, get sales, and boost your Seller Rating by relying on Amazon’s incredible fulfillment operations.

Amazon Exclusives Program

As I noted in the beginning of this post, Amazon is keenly interested in promoting product discovery in its marketplace (a self-serving goal, to be sure, but one that also benefits third-parties like you). The Amazon Exclusives Program is one way the marketplace helps you win new eyeballs. Amazon describes it as, “best destination for innovators to launch and build a brand by providing increased brand discoverability, marketing opportunities, and self-serve brand tools.”

Don’t let the word “exclusive” scare you. Participating in Amazon Exclusives doesn’t mean you need to abandon your existing ecommerce site. Amazon defines “exclusivity” as “selling through Amazon, your own websites, and your own physical stores.” In other words, the only secondary-channel outside of your direct-to-consumers is Amazon Exclusives.

Mind you, don’t have to expose your entire product catalog; you can sell just one product. What’s interesting about Amazon Exclusives is that Amazon will actively market your products on your behalf. It’s marketing channel is robust, encompassing onsite marketing, email campaigns that include your products, deals, giveaways, branded content and video. It’s very difficult to get your products included in the marketplace email and on-site Deals of the Day recommendation channel because there’s many people playing in there, but this program increases your chances.

Engagement Opportunities

When you sell via the Exclusives or Marketplace programs, you have one opportunity to engage directly with the end consumer, and that’s to request feedback from the customer. This email is your opportunity “to close the deal” and make them loyal to your brand (from a digital perspective).

Asking for Seller Feedback is essentially asking for an review and the amount of positive feedback you receive will have a direct impact on your products appearing in the product recommendation areas and winning the Buy Box (the display on a product detail page with the Add to Cart button that customers can use to add items to their shopping carts).

This means that feedback is important and you should ask for it, but you should also email the customer to introduce them to other areas of your product line. Just take care how you word that introduction, as Amazon frowns on selling products offsite in that feedback message. Think long and hard on the best way to initiate a direct relationship with a consumer who is likely to be a faithful Amazon shopper.

Sellers who do their own fulfillment have a second opportunity to touch the customer: the product packaging. The box your product arrives in is an opportunity to put your brand in a good light, which means you should really consider upping your packaging game.

You can buy short-run custom packaging from numerous suppliers, or at the very least, use a branded packaging tape with your logo, so there’s no reason to throw your product in a USPS box. (I’ve received products in packages the sellers created out of USPS boxes all duct-taped together. It took me a long time to access my product. Never again!)  Remember, first impressions count and effect your seller rating. Amazon shoppers are different from your other customers, and you need to approach them differently. They’re accustomed to an Amazon out-of-box experience, and it’s worth an investment to replicate that.

Finally, offering an in-box incentive is a great way to entice shoppers to your website and to establish a direct relationship with them. Offering a best-in-class, exclusive to Amazon shoppers, is even better. In other words, don’t offer the same promotion you offer to your affiliate channels. Your customer is already your customer, thank them for it.

Once that customer arrives on your website the world of marketing opens up to you. You can engage them via email marketing, retargeting, and make them profitable through the lifetime value of that customer.

1 https://www.cnbc.com/2018/01/03/amazon-grabbed-4-percent-of-all-us-retail-sales-in-2017-new-study.html
2 https://services.amazon.com/selling/benefits.htm/ref=asus_soa_hnav