Aug 14 2009

The Largest Sales Floor in the World

Recently I got this research and statement from Gartner Consulting.

Media and advertising follow consumer attention, and consumer attention has shifted massively toward social media on the Internet. Social media currently reaches nearly half of the U.S. population, and usage has nearly quadrupled during the past two years, according to comScore Media Metrix.

Now, to be clear Gartner defines social media as all blogging and social networking. All interactive media. That means all blogs, social media platforms like Facebook, Twitter, YouTube, Flickr, and all online traditional media like the New York Times and CNN. No matter. It is still a staggering stat.

Welcome to the new Sales Floor. It is the largest in the world. If Media Metrix is right then over 150 million people are on this sales floor, just in the United States alone.

150 million people buying, trading, reviewing recent purchases, talking with others about future purchases, talking about brands, praising or complaining about a brand’s customer service, discussing a brand’s message, passing information back and forth about pricing, reading the news of the day and expressing opinions. Feedback loops everywhere.

The architecture of this Sales Floor would be like combining all the major cities of the world into one road map.

And it is growing larger.

And every one of these people wants to be treated as an individual.

Media and advertising follow consumer attention.

If you want to grow your business, you should follow and engage this mass of consumer attention while learning to treat each as an individual.

We have a lot of work to do.


Aug 5 2009

The Funnel is Now Right-Side Up

In a recent conversation with Brad Werntz of Pemba Serves we were discussing the new business models that would develop due to new media.

For some reason my mind came up with a funnel and I started talking about it. By the time I was finished it made a lot of sense, which wasn’t surprising to Brad but a shock to me.

So the communication funnel has been upside down for a long time. Why?

Until recently all messaging by brands went into strict portals like magazines, radio, television, newspapers. Went into the top of the upside-down funnel. Media would receive the messaging, charge for it, place it in their formats, and then distribute.  Advertisers and the media told the brands that they could reach more people more cost-effectively then any other method.

And they were right.

So, all of this messaging went into the top of the funnel, got processed, and then was delivered to the target markets, and hopefully to a lot of people.

With new media this has all changed.

The funnel is now right-side up. Meaning that anyone can publish and can do it at no charge. The top of the funnel is open to the public. Opinions, product reviews, customer complaints, brand messaging, sales pitches, you name it…is flowing into the distribution systems.

Now, all of this information gets seen, and if good, it gets passed around. And if really good, it gains momentum and readership as it moves down the funnel. It also gets directed meaning that many people are involved and directing this information virally to the target markets that would be most interested. People like them.

So, with new media everyone can publish, everyone can express an opinion, everyone re-channels, and in the end the good information gains momentum and hits its proper target market.

So, why do brands still believe they control the message?


Jul 28 2009

Impressions of the Outdoor Retailer Show

First, I thought ORSM09 was a very positive show. Two things continue to happen. The stock market continues to move upward, reaching 9000 just before the Show. Second, this staycation thing is the real deal. People are staying home, taking up new sports, planning local family vacations, and the outdoor industry is benefiting.

It’s all working and our industry, although listing to port a little, is not capsizing. 

And I like the general attitude. “Yeah, things could be better, but we are still making some money, running a tighter ship, and we will make it through.” 

New media is growing in the outdoor space. Tweet-ups, constant tweeting from the Show floor, and many of the major brands looking at or engaging in the blogosphere. Outdoor Retailer is embracing new media and supplying more portals on the Show floor. All good. 

I still strongly believe that the Show should open its doors to the public on the last day. It will happen someday. It is inevitable. 

Now, to the darker side. I heard from several very reliable sources that a certain large retailer threatened several large brands if those brand did business with online powerhouse Amazon.

Let’s start with this. After too many years in the marketing business I must emphasize again that retailers and brands can not fight the market forces. For example, I remember about ten years ago, medium sized specialty retailers were running around the Show telling the brands that they would drop any brand who sold online. Several brands sought my advice. I asked this question,” where is your growth?” And they replied, “Online.” And I asked why? And they said, “Because we think that is where a growing percentage of the consumers will be.” 

Right direction. Right thinking. 

YOU MUST FOLLOW THE CONSUMERS. YOU WILL NOT LEAD THEM. YOU CAN NOT BULLY THEM. THEY ARE TOO BIG. THEY ARE IN CONTROL. THEY HAVE ALWAYS BEEN IN CONTROL. AMAZON IS GROWING FOR A REASON. 

So, to this large retailer, I say, you must stop this nonsense. Brands will follow the money. They will sell to retailers who bring them customers and offer growth. They have no choice. Their shareholders have put a bulls-eye out there and told management to hit it. Unless, you, large retailer, want to guarantee the returns necessary to keep these shareholders happy, then you must do it the old fashion way.

You must compete. You must continue to create a unique position in the marketplace, buy creatively, attract more consumers to your doors and online, offer great customer service and sponsor customer loyalty programs. You will sell more, and order more merchandise. And the brands will support you more. 

And speaking of support…how can you, large retailer, threaten brands when almost 50% of your floor space is now your own branded products? You, at times, drive consumers into your stores using other brands as the bait, and then you offer your branded products at a lower price while your salesforce whispers that your product has the same quality only it costs less.  

So you are partners with the brands, you compete with them in your own stores, and now you threaten them because they want to grow their businesses. No wonder brands are confused and, at times, angry.

You are a retailer. A damn good one. Probably, the best.  You have been solidly on the side of “good”. You have helped grow the outdoor business. Now, others with a different business model, want to do business and help grow the industry. Invite them in.  And sure compete with them, hard. But also talk with them. Educate them about expectations. Talk to them about the environment, sustainability and participation. Show them how to be a force for good in the business. Both of you will profit. Why? Because you are both capable of bringing millions more consumers into our business. And everyone will profit. 

So, be the leader that you are, and stop baring your teeth.

Peace. 

Out.


Jul 17 2009

Window to the World

I found the below graph from eMarketer (done by Ruder Finn)  very interesting. 

Overall, Ruder Finn divided online activities into six categories, listed from most common to least:

     * Learn

    * Have fun

    * Socialize

    * Express oneself

    * Advocate

    * Do business

    * Shop 

Men were more likely than women to go online for business, entertainment and to keep informed on news and current events.

Women, in turn, were more likely to use the Internet to advocate for a cause or issue, express themselves and socialize.

More than two-thirds (69%) of young adults ages 18 to 29 posted comments on social networking sites, 55% played games and 50% went online “specifically to rage against a person or organization.” 

Okay, much of this data doesn’t surprise me. What does is that 100% of the respondents are going online to “pass time”. Pass time? Who has got the time to pass the time? Once I got past feeling sorry for myself, then it started to become clear. 

The Internet has become an entertainment center, information center, education center, and a conversation center. It is becoming all things to all people. So, that monitor that sits in the house, or in the office…it truly has become the window to the world. 

So, if you are an outdoor business, then understand that your customers, consumers you want to reach, your vendors, your manufacturing partners, your environmental and social initiative partners, your reps, your retailers, your employees and their families are all looking “at the screen”. For many it is the first thing they do in the morning and the last thing they do at night, with many many visits in between. 

Brands better be presenting themselves there. And they should educate, entertain, sell, and dialogue.  

Ten years ago this was a dream. Now it is here, with all of its advantages.

Go.