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Is Barclays right about online discounts and their impact on sales?

May 27, 2015 by Marketing Donut contributor

Is Barclays right about online discounts and their impact on sales?{{}}You may have seen the latest Barclays TV ad in which a woman gives shoppers a money-saving tip. She suggests that online shoppers place items in their basket but not checkout and instead wait for a coupon to arrive via email.

It is, in effect, advising cart abandonment as a way of shopping. Marketers often debate whether recovery incentives actually work. So we were very interested when an organisation that had been taking such an approach (using a 15% discount incentive) came to us with results of a 26.2% sales uplift!

But, as we discovered, this didn’t tell the whole story.

With permission, we let the existing program run for several weeks to get a baseline before removing the coupon and continuing for a further period. The sales uplift immediately plummeted from 26.2% to 6.4%. Had we made a horrific mistake?

Here's what happened:

Sample

Sales
Uplift

Immediate
Purchased
Rate

Recovered
Rate

Value
Purchased

Percent
Abandoned

Value
Recovered

Cost of
Recovery

15%
incentive

34.0%

33.5%

13.0%

$79,620.00

66%

$20,054.13

$3,008.12

No incentive

6.0%

43.8%

4.0%

$80,184.00

57%

$4,251.62

$0.00

Difference

-28.0%

10.3%

-9.0%

$564.00

-9%

-$15,8.2.51

-$3,008.12

 

What stands out is that the recovery numbers had been boosted by the 15% incentive, so they fell when we removed it. But the value purchased hardly changed – in fact, it increased slightly when the incentive was removed. Customers were still buying at the same rate.

Clearly, when we stopped the incentive, a lot of people were buying through the normal checkout process, instead of getting diverted into abandonment recovery. The organisation had been allocating about $3,000 per month to the incentive, without increasing the value of sales at all.

What was happening?

Absolute price was never much of an issue, but nobody likes to pay over the odds. So, when presented with a 15% coupon in the cart abandonment email it changed purchasing behaviour as shoppers who would have bought immediately were diverted into becoming delayed buyers.

Instead of putting products in the cart and buying, shoppers would leave, wait until for the cart abandonment email, then return to the site and copy the coupon from the email.  But this is a much more complicated process and it’s well known that simplifying the checkout process improves sales.

Some of the would-be savers tried to save 15%, found it was all too much trouble and dropped out. Maybe the recovery email went to the spam folder, or maybe the coupons expired before they got around to using them. The precise reason doesn't really matter – what’s clear is that some potential shoppers were tempted by the offer but ultimately it actually stopped them going through with the purchase because of the added complexity.

The lesson is that you have to be very careful with incentives. Whenever you introduce a powerful reason to buy in a particular way, some customers will switch to it. But if your new way is complicated, some of those will drop out, and you could actually lose sales.

Copyright © 2015 Mike Austin, CEO of Fresh Relevance.

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Get started with email marketing

May 18, 2015 by Marketing Donut contributor

Get started with email marketing{{}}When it comes to building a brand and converting prospects into customers, email marketing is still one of the most powerful and cost-effective tools. But in an era of one-click unsubscribe and a customer base highly attuned to the ways of marketers, how can small businesses make the right connections?

Step one: build the database

The days of buying a prospect database are long gone – that approach is a fast track to a bad reputation and an avalanche of unsubscribes.

Instead, firms need to actively capture the email addresses of both customers and prospects; pretty much everyone you come across.

It is also worth considering creating a single database that combines both sales and marketing information. This avoids duplication and errors and it also makes it much easier to track interactions. This way, your sales staff get insight into all the past prospect communications, including which emails prompted click throughs and which did not.

Step two: create the right content

Email marketing is not a one-off event; it is an opportunity to build a relationship. And that means not bombarding individuals with blatant product sales – that will do nothing to inspire confidence or demonstrate value.

Instead, organisations need to create content that is interesting, insightful and indicates an understanding of the market.

Step three: use an email marketing tool

It’s well worth running an email marketing campaign once a month. But with each mailing, you’ll have manage all the inevitable email bounces and unsubscribes manually and that can be an administrative nightmare.

You can save a lot of time and stress by using one of the many low cost email marketing tools on the market. Products such as MailChimp can automate much of this process; and if it is integrated with your CRM system, so much the better as that means your database will also be updated automatically.

Step four: measure effectiveness

Email marketing tools provide valuable information about the success of each email campaign – most notably click through rates (CTR).

By combining your email marketing tool with your CRM you can add relevance to that data – correlating the number of leads generated and sales closed provides a direct financial ROI figure that can help you improve your on-going email marketing activity.

Step five: increase sophistication

Once you have mastered the process of sending regular, relevant and interesting emails, you can further fine-tune your email strategy. One way to boost your results is to split the email campaign between customers and prospects and refining the message accordingly.

If the company has enough insight in the customer database to distinguish between hot and cold prospects, it is also worth considering varying the frequency of the emails; creating a stronger, more frequent relationship with those on the point of purchase, for example.

The key to success

Email marketing is all about building a long-term relationship and then closing the deal. The key to success is to get the right processes in place from day one and then use the data to improve your return on investment.

Copyright © 2015 Helen Armour, marketing manager at Really Simple Systems.

Five steps to help you reach your target audience

May 05, 2015 by Marketing Donut contributor

Five steps to help you reach your target audience{{}}Choosing the right communications channels isn’t easy. And the social and content bandwagons have added even more pressure to business owners that feel they have to use all channels.

But being disciplined about which channel to use for what enables you to create consistent messaging that reaches the right audience in the right way and at the right time in the sales cycle.

Here’s how to reach your audience:

Step one: hyper-segment your target market

Splitting audiences into broad demographic groups is not enough. An effective marketing strategy requires detailed information on who is buying a product or service. Big companies do this kind of thing all the time. But if you are a small firm selling to consumers, you should think about how much your prospects earn, what they do and how they spend their spare time. B2B firms can combine sales data with desk research to establish job functions and other key customer characteristics.

Step two: Don’t forget traditional media

The Global Web Index Q3 2014 shows that the UK is one of the only countries in the world where time spent consuming traditional media still outweighs time spent consuming digital media.

For small firms, radio and printed press offer extremely valuable media opportunities. The GWI data shows that 45% of 16-24 year olds and 55% of over-55s still consume traditional printed press. The younger the audience, the more likely they are to consumer print press online.

Step three: get networking

Five years ago, it was a must to “do social”. The clouds are clearing now and most companies are recognising the need for appropriate and strategic social media activity linked directly to audience. But knowing which channel to use and how can be a minefield.

Facebook reported an increase in the number of daily users in 2014 showing that it is still a force to be reckoned with. Used by 81% of 18-29 year olds and 60% of 50-64 year olds, it’s the network of choice for the educated and affluent with 69% of users earning more than £48k a year. That said, Facebook’s organic reach is in decline so brands now need to look to paid for activity to get in front of audiences.

Only 18% of internet users are on Twitter and many users prefer reading than posting tweets. But just because they are not talking doesn’t mean followers aren’t listening. The media in the UK are also big users of Twitter so it’s also a good media relations tool.

LinkedIn is the key B2B network. Econsultancy suggests that it accounts for 64% of visits to all corporate websites after tracking two million visits to 60 sites over two years.

However, for consumer brands, the network has little value. For B2B firms, it’s an ideal tool for the targeted dissemination of news and content.

Pinterest can be a great way of getting products and content shared – and driving sales - assuming you have great imagery. UK users are now well over two million and 80% of pins are re-pinned from elsewhere on the site. For certain types of consumer brand - from fashion to food and interiors – it can be a great weapon in the communications channel armoury.

Instagram, Snapchat and WhatsApp have captured the younger market partly due to immediacy and partly due to concerns over privacy and “digital legacies”. However, these networks hinge on personal communication, leaving little or no room for brands.

Google+ is a great tool for improving the visibility of your online content. Often overlooked, it’s worth using if you want your content ranking as high as possible on Google as Google+ posts get indexed more quickly than content on other social networks.

Step four: Integrate

It’s important to stress that all channels should be integrated to deliver best return on investment. But don’t be tempted to simply replicate content across all channels. Keep messaging and themes constant but tailor content where necessary.

Step five: measure, refine and measure again

Whatever communications channels you choose to use, build in KPIs and evaluate progress on a monthly basis. If activity is working, do more; if it is not delivering, then leave it behind.

Equally important is knowing when to call time on an activity. If you’re starting from scratch it’s probably going to take you six months to test the waters. With all integrated marketing there is a momentum that needs building so give it time.

However, once you’ve reached momentum, be ruthless. The moment results decline (or if they fail to emerge), change your tactics.

Copyright © 2015 Rebecca Scully, managing director at Smarts Illuminate.

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Why there are no rules in communication

April 27, 2015 by Andy Bounds

Why there are no rules in communication{{}}“Give me some rules of thumb with communication – rules that I can follow without thinking.”

So said one of my clients recently. I asked what areas he was most interested in.

Him: “Well, when I’m making a formal presentation, should I use PowerPoint or not?”

Me: “I don’t know. It depends what the audience wants. Your best bet is to ask if they want you to use it or not.”

Him: “OK, but if I do use PowerPoint, should I send information in advance, or take everything with me on the day?”

Me: “It depends. Ask them what they want.”

Him: “Should I start my presentation with background information, to set the scene?”

Me: “It depends. Ask them if they want it.”

Him: “Who should present the information? The best presenters on my team? The people actually doing the work? Does it matter?”

Me: “It depends. Ask...”

My client interrupted me: “This is exasperating. I’m looking for some rules of thumb.”

I said: “Can't you hear the rule of thumb? Ask.”

The best way to ensure you give people the communication they want... is to ask them what they want. Contact them before the communication, and ask such questions as…

  • What do you want me to cover?
  • What do you want me not to cover?
  • Have you any concerns, that you want me to address?
  • Who else will see this communication? Is there anything I should include for their benefit?
  • Would you prefer a formal PowerPoint, or a more informal discussion?

If you don’t ask, you don't know. And that means you are guessing. This makes it less likely you'll get the outcome you and they want.

Copyright © 2015 Andy Bounds is a communications expert, speaker and the author of The Snowball Effect: Communication Techniques to Make You Unstoppable. His latest book is Top Dog: Impress and Influence Everyone You Meet.

Eight secrets to help you get press coverage

April 22, 2015 by Amanda Ruiz

Eight secrets to help you get press coverage{{}}Have you had your fingers burnt when hiring PR agents or agencies? Did they tie you into an expensive six-month retainer but didn’t deliver the results you were expecting? Or do you just want to do your own PR but don’t know where to start?

Fear not – here are my secrets on how to get into the press.

When I first started on my entrepreneurial journey, a friend (who runs The Mumprenuers Networking Club) said something that really struck a chord. She said: “Every day you must do at least one promotional activity in order to drive customer and brand awareness”.

So with those words ringing in my ears, I really went to town and mastered how to get into the press.

Through huge amounts of perseverance I secured press coverage in many of the major glossies and national newspapers. Here’s my step-by-step method to ensure you get results.

  1. Find your “golden nugget”: the thing that makes your business interesting. Then decide on your press angle: is it a product launch, profile piece, something seasonal, a local story, or a reaction to recent news?
  2. Research your ideal client: where do they hang out, what do they read online and offline, where do they shop, what are their hobbies, what’s their income? Find this out and create at least three mood boards to fit each type of client. Now target publications that fit these profiles.
  3. Research your competition: don’t reinvent the wheel, see where your competitors have got press mentions and which angles they used. This will inspire you to think of more new angles.
  4. Research your target journalist: read their articles, look them up on journalisted.com and LinkedIn, and follow them on Twitter. Contact them about the things they tend to write about and mention their latest article to show you’ve done your homework.
  5. Create a PR toolkit: including professional photographs and strong copy. Make sure your website is up-to-date website with clear contact details.
  6. Write a press release: and make sure it is newsworthy. Consider why the readers want to read about your business. Include: an eye-catching headline, short sharp paragraphs, a quote, verifiable facts, relevant statistics and full contact details. Share your press release via social media and make sure it’s easy to find on your website.
  7. Make a PR plan of action: be targeted. You will get the best results if you focus on your key targets and do quality follow-ups rather than doing a mass mail-out and hoping something will stick. Create a plan of action listing: contact details, date of contact, feedback, action to take.
  8. Develop a PR campaign: Practise your pitch before you go to the big guns. Never leave a voice-mail as journalists are busy; keep calling them, but try not to come over as a stalker! Be persistent and polite.

Once you have got into the press, make sure you say thank you to the journalist. Then add the piece to your website and share it on social media.

Copyright © 2015 Amanda Ruiz is the founder of www.amandaruiz.co.uk. She runs online courses for entrepreneurs that want to get press coverage.

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