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January 31, 2008 |
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Marketing Methods and Alternative Options for 2008 Part Part IV:
Incentive Programs: Gift Cards, Refer-A-Friend, Coupons and Sweepstakes
by Chip Arndt
 Miami, FL (January 31, 2008)—The last three newsletters covered marketing methods using traditional Comparison Shopping Engines, Marketplaces, Affiliate Sites, Print Media, Press Releases, Newsletters, E-mails and Blogs for small to mid-sized merchants to reach consumers. For this month, we explore incentive programs.
We have found that using and mastering traditional marketing methods is mandatory to help “spread the word” about your company and that complimenting these methods with new marketing initiatives drives sales and brand awareness.
If you missed the prior three newsletters, and prefer to read them first, please click here to view the Newsletter archive. All newsletters are archived and free to read.
So let’s continue from our last newsletter commentary.
Overview of Marketing Options
Options, options, and more options!
It is an overwhelming task to cover the full landscape of marketing options and by no means do we claim to cover them all, but we try. In addition to the several marketing options covered in the last newsletter, online merchants should consider complimenting traditional methods of marketing, such as print media, press releases, newsletters, snail mail, and e-mails with new methods such as blogs, search engine marketing and optimization, video e-mail, gift cards, coupons, sweepstakes and other ideas to drive quality traffic to your storefront and turn this traffic into paying customers.
The goal of effective marketing is simple: drive customers to your online storefront.
This can be achieved in numerous ways and some methods work better than others. Some traditional, seemingly outdated methods, such as direct mail and print media, are STILL very effective. And when traditional methods are complimented with new marketing methods, we have found that more traffic is driven to an online merchant’s storefront and that this traffic is “stickier” and easier to turn into customers.
MerchantAdvantage believes that regardless of which marketing method(s) you choose, each marketing method compliments and works in concert with the other. For instance, if you send out a direct mail during the holidays, ensure that you highlight specials mentioned in these direct e-mails on your website, provide coupon codes that only can be redeemed online by the person receiving the snail mail (which helps you track whether the mailing worked), highlight a “special offer” that a customer can only receive online, remind them of monthly online specials, create easy access to membership and gift card programs, and create a blog (if you have the time) to educate customers on the value-add of your products and remind them of special offers on your storefront.
Another example is when you execute an online e-mail campaign, ensure that you provide “hyper-links” in this e-mail to landing pages within your site that speak to the “special offer” you are referring to or the membership program you are trying to build. These are just some examples.
The main point is that consumers are so savvy that using marketing methods to just drive them to your online storefront is NOT enough. Once you make a connection with a potential customer about a special offer or program, ensure that when they reach your sight, they come to the “special message” directly and can act on it quickly.
Okay…onto what you may already know…or maybe not.
Incentive Programs: Gift Cards, Refer-A-Friend, Coupons and Sweepstakes
Definition:
Incentive programs are marketing campaigns that provide the opportunity to receive something for doing something else. They can work but need to be executed perfectly. Examples include: creating marketing campaigns that implement either a redeemable coupon for people to use when making a purchase on your site; a time-limited special offer to sign-up and win something fantastic (such as a cruise vacation, tickets to a concert, or even a week at a trade show); gift card programs; or refer-a-friend and receive something for the referral. As there are companies that devote their entire business model to helping small to mid-sized businesses with these type of programs, we will let them speak for themselves and mention a few ideas and examples of what you might consider.
Example 1: Gift card usage.
During January, retailers frequently reminded subscribers to redeem the gift cards they received during the holidays. However, a handful of retailers took the additional step of incentivizing subscribers to redeem their gift cards so the retailers could book the value. Bass Pro Shops, in a Dec. 25 e-mail, offered a $4.95 shipping rate when subscribers used their gift cards, while Foot Locker, in a Dec. 26 e-mail, offered 10% off or free shipping. The Sports Authority also offered 10% off.
Example 2: Friend referrals.
Blue Nile incentivizes both the referrer and the friend by giving them discounts on products via targeted e-mail campaigns. Customers then link back to the Blue Nile site to redeem product discounts and are given the option to refer a friend. Then these referred leads are tracked in their data base for follow-up with further credits and discounts given to the referring entity. Furthermore, lead-generation contests are common which incentivize entrants to notify their friends about the contests…and the cycle goes onward.
Example 3: Gift reminder sign-ups.
About 10% of major online retailers have gift reminder e-mail programs, including 1-800-Flowers, Barnes & Noble, Hallmark, Lillian Vernon, Omaha Steaks, Overstock, ProFlowers, RedEnvelope, Sharper Image and Sportsman's Guide. A few of them have offered incentives for sign-ups, including Lillian Vernon, which in a Jan. 9 New Year's-themed e-mail offered $5 off and promised that you wouldn't forget people when doing your holiday shopping ever again.
Example 4: Wish-list building.
Wish-list creation is a strong signal that a customer is ready or likely to buy. Looking to tap that indicator, Old Navy held a sweepstakes during the holidays, giving folks a chance to win everything on their wish list. They notified subscribers of the sweepstakes in a Nov. 19 e-mail. What's great about this tactic is that it encourages consumers to browse your products, which isn't always the easiest thing to do online. So at its heart, it's a promotion that encourages assortment familiarity and discovery.
Example 5: Coupons Usage.
A beauty company ensured that any time a customer bought $25.00 or more of product, a pop-up box came up offering 5-10% off other items that complimented the products they bought. They also placed these coupons for free on www.mycoupons.com a “couparison shopping site”, which enabled them to save money and expand marketing reach by repurposing their coupon program.
Example 6: Sweepstakes.
A small company specializing in fishing equipment had a contest to submit the best pictures of a fishing trip that “Best Exemplified The Fun of Fishing” for a three month period. They created a separate webpage (with product links to other areas on their site) on their site about the contest and posted pictures as they came in. People who came to the site could vote on the best pictures, which counted for 50% toward deciding the winner and company management counted for 50%. They revealed the grand prize winner the week of July 4th. The grand prize was a week in Key West, Florida and they had sponsors in Key West help with promotion and even placed a paid ad on their promotion page.
Mission to Working with Incentive Programs:
Let’s keep this simple. Here are three main reasons to work with Incentive Programs:
- Fun
A. Incentive campaigns work, but can be a miserable failure if your “execution” and/or “prize” associated with the campaign is cheap or dumb and the marketing associated with the offer is boring.
- Brand Building
A. People remember companies that help them get a better deal, albeit coupons and incentive programs, or create some fun campaigns to win a trip.
- Differentiation from Your Competition
A. If you consistently offer coupons you can then tailor them and repurpose them for seasonal specials and separate yourself for the competition even more.
B. Sweepstakes can be fun and a real value add to building loyalty programs.
Here are three main issues when working with Incentive Programs:
- Cost
A. If you have an in-house person to handle all of the machinations of a viable and excellent on-site incentive program then great, if not you then have to outsource, which may be worth the cost and time to execute and follow-up correctly.
- Execution
A. Have you ever been involved in an incentive program that did not work well and you never came back to that storefront? I have. Enough said.
- Follow-Up
A. Climbing 95% of Mount Everest is worthless….so focus on the full follow through and follow up with those who participate in your incentive programs. If you can’t do weekly follow up then don’t embark on this type of marketing program.
B. One method to proper follow-up is creating automated e-mails at sign up, automated, ongoing follow incentive campaigns, and “thank you” follow ups after the campaign. The point of all of this is to build your database and a loyal customer following and the only way to do this is through gracious and thoughtful FOLLOW-UP!
Recommendations to Working with Incentive Programs:
- Ensure that you know what you are doing.
A. Having an incentive program that does not follow through to your website, check out page in your shopping cart, data base, and incorporates proper e-mail follow-up and reminders will lead to miserable results and hurt your brand.
B. I recommend working with viable coupon/incentive companies that are professionals at helping you set up and execute these marketing strategies and can work properly with your shopping cart technology. If done well, these programs can work quite well.
- Same recommendation goes for Sweepstakes, which can be much harder to manage.
A. You want to ensure that it is properly presented on your website, various landing pages within your site and blog (if you have one), and
B. Track for real signs up from potential customers and not just random people.
- Fun with Art
A. Graphics should be interesting, engaging, beautiful, and consistent with your brand.
- Make sure you are offering something of real “value-add”
A. Does 5% off shipping really make for a good promo, or $0.25 off of an expensive product, or a trip to somewhere where no one wants to go? I think not…make it worth the customers’ effort to engage with you.
PART V of this Newsletter Series on Marketing Methods and Alternative Option for 2008 covers Search Engine Marketing and Search Engine Optimization using general search engines and comparison shopping engine search features.
MerchantAdvantage Wrap Up:
There are many ways to market online and wirelessly. No method is perfect and online merchants should manage each marketing campaign carefully, understanding how each campaign can, and should, tie into the other. This approach ensures that you are sending a consistent message to the marketplace and that any leads that come to your storefront from these efforts are managed properly, albeit a special offer via a marketing channel is reflected back on your site when that potential customer comes to your site. There are also limitations to what an online merchant can afford, and most online merchants don’t have the money or internal resources to manage too many marketing initiatives effectively. So choose two or three marketing strategies, manage them efficiently, and when you see that you have mastered them, introduce another method and make sure that it ties into your existing marketing efforts. |
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Think Outside the Box
by Brett Bernstein, Tech Support
 Miami, FL (January 31, 2008)— I took a few moments to read the article by Chip in this issue and found it ironic that my article takes an opposite approach to the same issue.
I certainly agree that the definitive source for your marketing data is your storefront…in virtually all cases. However, as we get into the details we find that it is merely only the source of your data, but it is certainly not the final marketing content which you should send to all of the shopping destination sites.
Data within a storefront application has been created, and is entirely formatted, for the storefront. Its sole purpose is to entice consumers to purchase product AFTER they have already arrived at your storefront. But to shift to an age old analogy, what you say to get someone "into a store" is significantly different to what you say once they are there. The same is true of online marketing. Data that will interest a consumer while at your site may not hit home at all when viewed on a random Google search or a comparison shopping engine ("CSE") session.
Let me insert here that I HATE spam. But I am always curious as to what the spammer’s goal is when they send me the strange emails that they send. Do they really think I will be enticed to get a second mortgage on my house because of a random infuriating email? This kind of marketing, to me, is ludicrous. No matter how inexpensive this is, I just can’t believe ANYONE will simply sign up for a second mortgage because they got a random email sent via a disreputable method. How desperate would I have to be to accept this marketing solution, and move forward with the company for my second mortgage? And I don’t even want to get into the other spam marketing emails…they couldn’t possibly be working. Sorry, I digress.
The point is that data, or a marketing message, should be adjusted for the venue to which it will be dispensed. As another example, Budweiser always has a "special" message when advertising for the Super Bowl, as opposed to standard magazine ad. So, too, should an online retailer’s message be different for someone shopping in a shopping destination site than for a consumer already on the retailer’s storefront.
That’s why it makes sense to "alter and adjust" your product information before marketing/sending it to external marketing venues. Obviously certain information remains the same – price (and quantities when applicable) for example. But sometimes it does make sense to change basic information like the product name when sending your data outside of your own systems and to CSEs, or other marketing channels.
So here is some advice for any merchant when marketing online. Before sending product data to shopping destination sites, scrutinize your own data but with a new viewpoint.
Review your data in the same format that it exists at the shopping destination sites, and then see if you would be enticed to visit your own store. If it makes sense to alter some of your content that you send to a marketing channel in order to appeal to consumers to then click into/onto your storefront then do it! |
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Merchant of the Month:
Soholighting.com
 I am really excited to be up and running on the MerchantAdvantage application Channel Management. We were about to outsource our channel management and data entry work to a firm in India for a couple of thousand dollars a month when MerchantAdvantage came along.
This application has saved us tons of time and money and our data feed is more accurate. We have also begun listing with many other channels where we expect to see an uptick in sales. The program is extremely robust and has so far exceeded my expectations in terms of it's capacity to manipulate and handle my data.
The training sessions were very organized and professional and I have found all MerchantAdvantage staff to be helpful and knowledgeable. The program is intuitive and easy to use though that it might just feel that way because of the tremendous training and follow support from Brett.
Thank you to the entire MerchantAdvantage team - especially Brett for your great service, training and follow up.
Zev Herman, Chief Operating Officer, soholighting.com
Get Your Channel Management Fee Waived Plus Receive a Complimentary Companion Airline Ticket!
We're thrilled and inspired by all the Channel Management success stories you share with us. Now we want to turn the spotlight on you! Send us your best Channel Management success story and you could be selected as our Merchant of the Month.
If chosen, your company will be exclusively showcased in an edition of our monthly newsletter, eTail dTail.
Best of all, your monthly MerchantAdvantage fee will be waived in the month you are selected and you will receive a complimentary Companion Airline Ticket. Submit your Channel Management success story today to stories@merchantadvantage.com. We look forward to hearing from you!
(Note: MerchantAdvantage reserves the right to use any or all of your story, whether or not your article is selected as the winning entry.) |
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About MerchantAdvantage
MerchantAdvantage (www.MerchantaAdvantage.com) is an ecommerce software solutions company committed to championing and helping the small to midsized online ecommerce Merchant address complicated mobile and online e-commerce issues and take a systematic, controlled and proactive approach to online product marketing. MerchantAdvantage provides long-term, cost effective software tools that enable an online business to grow by reaching the widest audience possible via online, broadband, and wireless devices. MerchantAdvantage's applications are designed to thoroughly connect the online retailer to their marketplace partners in a seamless motion of communication allowing Merchants to take control of their ecommerce channels, marketing strategies, and IT solutions. These software tools specifically help ecommerce retailers bridge the gap created by non-standardized data feeds to various online market places, shopping comparison sites, and other online shopping destination sites.
MerchantAdvantage is changing the macrocosm of ecommerce by staying ahead of the curve in providing business solutions to the growing online retail marketplace: We're here because America's commerce future is online.
MerchantAdvantage, the premier software for on-line retailers looking for an efficient and cost-effective method to online product marketing introduces Channel Management with Chanalytics(sm) Professional and Lite. Channel Management products help online retailers save time and money while maximizing their return on investment and marketing budgets by allowing them to easily connect to shopping comparison sites an assess their performance. MerchantAdvantage is for online retailers wishing to better manage online marketing efforts and increase sales volume.
MerchantAdvantage – Take Control of Your Marketing Channels! |
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MyCoupons (www.MyCoupons.com) is a pioneer of on-line coupon distribution. Since its inception in 1994, MyCoupons has led the way with innovations to help merchants reach their target markets in a cost-effective fashion. The latest innovations are the cost per redeem(tm) coupon code distribution system and the Couparison shopping(tm) engine. Cost per redeem provides merchants a lower cost method of distributing coupon codes. No set up costs and listing to MyCoupons is always FREE.
Couparison shopping provides consumers with an easy way to locate a coupon code for a specific product they are seeking and allows merchants to more finally tune their offers by linking them to specific products or product categories. The fees are low, flat and they only apply when the coupon is actually used. There are never any per-click charges and merchants have complete freedom over the structure of their coupon code offer.
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Do you have any issues, concerns or interests you would like to share?
Email us at:
tip@etaildtail.com
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• Final Online Holiday Shopping Tally Finishes Up 19%
by mediapost.com
ONLINE SHOPPING FOR THE 2007 holiday season totaled $29.2 billion--up 19% versus the same period in 2006, according to comScore, Inc., and off slightly from the originally forecast 20% bump.
Monday, Dec. 10, dubbed by comScore as "Green Monday," was the heaviest online spending day of the season with $881 million spent by shoppers, followed by Tuesday, Dec. 11 ($819 million) and Thursday, Dec. 6 ($803 million). "Cyber Monday" (Monday, Nov. 26), which represents the first major spike in online spending activity during the season, ranked as the 9th-heaviest day, with $733 million.
The week ending Dec. 16 was the heaviest week of the season with $4.7 billion in spending, according to Reston, Va.-based comScore--edging out the week ending Dec. 9, which saw $4.6 billion.
The week ending Nov. 18 showed the strongest growth rate (26%) versus the corresponding week in 2006, while the week ending Nov. 4 showed the softest growth (4%).
The results include home, work and university locations, but exclude auctions and large corporate purchases.
"Ultimately, the softness in the growth of online retail sales during the first 10 days of November proved difficult to overcome and prevented the season's growth rate from reaching our forecast of 20%," said comScore Chairman Gian Fulgoni. However, the period between Thanksgiving and Christmas--another measure of the strength of the holiday season--experienced a healthier 21% bump.
In terms of category sales, video games, consoles and accessories were the fastest-growing--jumping 129% versus the 2006 holiday season, with popular consoles like Nintendo Wii and Sony PlayStation and games like "Halo 3" driving strong sales in the category. Furniture, appliances and equipment (up 67%), event tickets (up 24%), and consumer electronics (up 23%) also experienced above-average growth, according to comScore.
After seeing substantial softness early in the season, online apparel sales picked up considerably in the latter part of the season, finishing up 18%. Meanwhile, sales of jewelry and watches declined marginally versus year ago as rising costs in precious metals like gold and platinum may have dampened consumer demand.
• comScore: Holiday shopping season was "robust"
by bizreport.com
For France and the UK the holiday shopping season proved to have quite a few benefits for online retailers. According to the metrics firm the season peaked in the first half of December for most etailers.
This is a fairly normal occurrence according to Bob Ivins, EVP of European markets for comScore. “The typical pattern we note in all countries, including the U.S., is that online retail activity peaks in mid-December as consumers have to allow time for shipping and delivery of their purchases in most categories,” he said.
In the UK, Amazon sites drew 9% of the traffic during the holiday shopping season (October 29 - December 23) while Apple brands attracted about 6% of online shoppers. The Home Retail Group of websites, which include Argos and Homebase pulled in 5% of holiday shoppers.
Meanwhile in France Groupe PPR was the main attraction for online shoppers, drawing in 11% of shopping traffic. Apple drew 5% of shoppers and Amazon websites drew in 4% of the holiday shopping traffic.
On the other hand, holiday shopping in Germany was not as robust. While users still flocked to online retailers, their peak was later in the season that the peak week for UK and French shoppers, indicating that while users were shopping online they were also finding deals in brick-and-mortar stores.
The leading shopping site for German etailers was Otto Gruppe with an 11% share of shoppers. Amazon sites attracted 9% of shoppers while Arcandor AG attracted 5%.
• Google Improves iPhone Offering
by pcworld.com
A month after it launched a customized Web portal for iPhone users, Google is introducing a new version that further integrates the company's offerings into Apple's popular phone. It will be on display at this week's Macworld Expo in San Francisco, and available to anyone who uses the iPhone.
The services are accessed simply by directing the iPhone's Safari Web browser to Google's home page. Previously, iPhone users had access to special versions of google Search, Gmail, Calendar, Reader and other services working from a unified interface on iPhone's Safari.
On Monday, Google announced that it has further streamlined the interface, tweaking it both for speed and usability. Users can also customize Google applications on tabs in the Google.com menu bar; you can select what Google app you'd like to use by bringing it to the front menu. The tab customization includes Gmail, Calendar, Reader, Docs and Picasa accounts.
Gmail is now faster, and features "auto-complete" that will automatically fill in the contacts field of e-mails. The calendar now features a Month view. Google users can also access "iGoogle" gadgets -- mini-applications that show you weather, stock info, news feeds and other content.
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"Technology should exist to aid us in our endeavors; We are here because you are online.sm"
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Michael Lambert, CEO |
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For information on how MerchantAdvantage may help your business grow, please contact us:
Chip Arndt
Executive Vice President
Business Development and Strategy
305.895.9466 x113
partnerships@merchantadvantage.com
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