Disruption Tour --- Run To Survive

Q2 Quarterly Online Sales Flash Survey Results

2009 is proving to be one of those contrary years, especially in retail — a mix of stops and starts, alternating signs of recovery and stagnation, perplexing (if not outright maddening) metrics.  As we have said before, we have no crystal ball here at Shop.org – but the collective insight of retailers in our most recent Shop.org/Forrester Quarterly Online Sales Flash Survey give us some directional clues at very least. 

59 retailers participated in the Q2 Online Sales Flash Survey, conducted from July 1 to 7, 2009.  Respondents represented a mix of business type (variations on multichannel, branded manufacturers, pure plays) and annual Web business size.  As usual, we asked simply, “How did your gross online sales (top line) for the period April 1, 2009 through June 30, 2009 perform relative to the same period last year (April 1 through June 30, 2008)?” 

Shop.org Members can download the full data and PowerPoint summary results from the Web site; following are a few highlights:   

• Fully 59% of retailers surveyed reported that their gross online sales had indeed grown for the quarter compared to the same quarter in 2008.  9% reported flat sales (in this economy, nothing to sneeze at), and one third (32%) reported sales decreases. 
• Average YOY quarterly growth across all retailers surveyed was 11.8%
• Close to two thirds of large retailers ($100+ million in annual Web sales) reported revenue increases for Q2 2009 vs. Q2 2008.  Ditto for mid-sized retailers (defined as between $10 million and $100 million in annual Web sales).  Smaller retailers (under $10 million) struggled somewhat more, but half of those surveyed in this segment did in fact realize sales growth. 

Thanks to all retailers who participated in this quarterly (and entirely anonymous) survey!  We look forward to your participation in our next quarterly results survey the first week of October, shortly after the Shop.org Annual Summit.  And, as always, we welcome your comments and thoughts.

The demographic has shifted dramatically over at Facebook

http://seekingalpha.com/article/147593-facebook-s-demographic-aging-that-s-great?source=email

The demographic has shifted dramatically over at Facebook and that change could lead to billions in revenue, according to one prominent board member.

iStrategyLabs spent the last six months collecting user demographic data and discovered the number of users over the age of 55 soared from 1 million to nearly 6 million. During the same 6 month period, high school and college users dropped by as much as 22%!

Here’s the breakdown:

At the same time Facebook continues to gray, Silicon Valley entrepreneur Mark Andreessen–a Facebook board member–suggests the social network could realize revenue of $1 billion if it would only push harder with its advertising.

"This calendar year they’ll do over $500 million..If they pushed the throttle forward on monetization they would be doing more than a billion this year…There’s every reason to expect in my view that the thing can be doing billions in revenue five years from now," Andreessen said.

What’s interesting is that the 15-24 year olds are the ones that helped Facebook become the juggernaut it is today, but when you have champagne revenue goals while your audience has a beer budget, you need those with established incomes to pay the bills–or in this case, click on the ads.

Perhaps the key question is can Facebook continue to grow while losing its vocal youth? Arguably, high school and college users were the ones that evangelized Facebook to their older friends and family. Without them, will Facebook’s growth–and revenue–stall?

The 5 Things People Pitching VC's Don't Usually Know

http://startups.typepad.com/my_weblog/2009/07/the-5-things-people-pitching-vcs-dont-usually-know.html

Image via Wikipedia

Here they are:

1. We see a lot of ideas, all the time, week in and week out.  Most say, if you make an investment in our company, we'll really be able to make progress on all fronts.   Some say, we haven't had much money to date, but look at what we have been able to achieve with little money in a small amount of time.  People that can make progress without money tend to be the ones who make the most progress when they have money.

2. Our scope and interests are limited.  We focus our plans on stage of investment, types of technology and specific geography.  We win by staying close to our plans.  We won't make an exception for you because any off plan successes are considered luck.  Any off plan failures make us look stupid.

3. Market timing can be the most important factor in success.  More important than management or product.  Again, not all the time is this true.   But, if you're late, we are likely to consider it game over.

4. We're in a hurry to produce returns but not necessarily in a hurry to invest as we need to be careful.  Careful in a number of ways including your idea, team and timing.   Your need for the money right now isn't often a factor in our investment process.   Repeating that you need the money now frequently, doesn't change that.

5. Sometimes, you may need to consider that your storyline needs to change.  What you focus on in the pitch is important to proper interpretation.   Commonly, people emphasize the product over the market and the team over the business.   We are investing in the business that will be derived from a market.

GDP for US Retail Sales est 2009

http://forecasts.org/sales.htm approx 4.2 billion and Total GDP US $13.8 Trillion
http://flagcounter.com/factbook/us#economy

http://www.computerworld.com/s/article/9075759/Online_retail_sales_in_the_U.S._to_hit_204B_in_08

Online Retails sales to reach for 2008 $204 billion

If you go back to 1994 when I began marketing in email with Text and then with HTML email the road we as marketers have followed in the email marketing channel has been paved in GOLD. In fact, email is so ubiquitous today that a merchant would be foolish not to use email as a marketing tool. It is one of the most profitable in their arsenal. Now if you follow the email GOLD road and apply it to where the world is today with TransactionalRSS(tm) (TRSS) and where we all see TRSS going in the next 15 years shouldn't you be jumping into this marketing channel? Shouldn't you be making TRSS part of your strategic plans for 2009/2010? Look at the following TRSS metrics....

General Mill/Pillsbury launched a TRSS feed for Recipes 6 months sooner then Kraft and they already have nearly 10 times the TRSS feed subscribers with their first move strategy. Pillsbury now has 98,000 RSS subs to only 9,000 for Kraft. Source:Google.

More to the point...Where will you be if your competitor moves into TransactionalRSS before your company does?

Intuit now has 20% of its visitors coming to its site from its TRSS marketing efforts Source: Experian

"Now this blog post hit my desk yesterday and it provides some solid metrics on email marketing nearly 18 years from where it began in 1994. Here are some key metrics about your e-mail customers." from Kevin Hilstrom Minethedata.com.

Once you read the bullets think about how this applies to TransactionalRSS (TRSS) and why you need to get into the know about TransactionalRSS. To learn more...why not give the team at RSSCheck/ShoppeSimple a ring or click. For details checkout RSSCheck.com.

• Half of all customers who purchased in the past twelve months subscribe to e-mail campaigns.
• E-mail buyers have a 77% annual repurchase rate, among the most loyal of any channel.
• Only 25% of your e-mail file bothers to click on at least one e-mail campaign, per year. The remaining 75% are inactive.
• Only 5% of your e-mail file buy something from your e-mail campaigns, on an annual basis.
• E-mail is what I call a "transition channel". It is the channel that your customers migrate to as they begin to rely upon catalog marketing less. After the customer buys from an e-mail campaign, the customer is likely to buy from your website, without attribution to any other marketing campaign.
• 80% of your e-mail purchasers buy merchandise on sale, or buy when free shipping is offered. As a result, your e-mail buyer file is over-populated with discount shoppers.
• When you offer full price merchandise via e-mail, you generate $0.05 per e-mail campaign.
• When you offer sale merchandise, or you offer free shipping, you generate $0.25 per e-mail campaign.
• Over time, you optimized e-mail performance based on the metrics you had available to you ... open rates, click-through rates, conversion rates. As a result, your optimization best practices resulted in a program that sale/promo customers love. Your customers are no longer interested in e-mail marketing unless there is a marketing promotion.

Best practices in TransactionalRSS(tm) marketing

1. Make subscription easy

RSS is new (it stands for Really Simple Syndication) to many of your customers. Companies often make the mistake of linking an orange RSS icon button to a page of XML code and force the consumer to get into tech speak. Obviously these companies are hoping their customers will “figure it out.” The ShoppeSimple offering includes our trademarked shopping icon and bag, custom landing pages in your company’s look and feel. It also includes merchant branded TransactionalRSS(tm) (TRSS) feeds in a consumers home page or Reader. ShoppeSimple also provides TRSS code for the newest technologies like IE 7/8 Firefox and Safari to alert your consumers s that there are TranactionalRSS Feeds on your website.

2. Use branding elements in your feeds. Nearly all RSS feeds are just a line or two of text, but through ShoppeSimple's TransactionalRSS template technology you can use your logo, fonts, colors, etc. This maximizes your brand identity, differentiates your feeds from your competitors, and makes the feeds more familiar to customers. With template technology you can include thumbnails, descriptions, buy-now buttons, and more.

3. Provide relevant content through personalization and category selection. 

The key to retaining subscribers is providing relevant content. With ShoppeSimple you can select the product category of your choosig and push out feeds to your consumers based on these categories. Also a merchant should consider using their datafeeds or the ShoppeSimple TransactionalRSS Feed System to make TranascationalRSS publishing automatic.

4. Measure subscribers and their actions

As previously described, TransactionalRSS presents unique measurement challenges as it does not require an email address for delivery. TransactionalRSS is private and anonymous. The technologies behind web analytics solutions therefore do not work in RSS readers or My Home pages. ShoppeSimple analytic technologies enable merchants to track every TransactionalRSS (TRSS) Feed and measure the behaviors of each TRSS thread. Reports the company provides include subscriber counts, content reads, Hub visits, clickthroughs, most popular content, most popular feeds, TRSS readers used, search engines, traffic sources and more. Due to the ease of unsubscribing, per subscriber analytics is especially important to assess the performance of your TRSS program. By judiciously analyzing your customers’ content interests and making appropriate changes in your content strategy, you can build upon your active subscriber base. 

5. Promote your feeds

Market your feeds using the ShoppeSimple's TransactionalRSS Feed System as a retention and customer acquisition tool. You company will find this new channel of marketing will increase your site visits by more than 20% and the TRSS order conversion is 5 times better than email. You will also see your TRSS order value increase by 20%.

6. Integrate with email and other marketing programs

ShoppeSimple has employed a Merchant Hub as a single consumer place that offers content as TransactionalRSS or email or social networking or mobile based applications.  This will allow merchants to acquire more subscribers over time due to the fact that many customers strongly prefer one medium over another. By addressing concerns such as privacy (giving out email addresses) and
technology (unfamiliarity with RSS), you have a chance to build trust with your customers by communicating with them on their preferred terms.

Placing the ShoppeSimple Icon on your opt-out subscription area will also allow you to retain those who many want t unsubscribe from email but who may choose to receive your TransactionalRSS feeds rather than opting-out altogether.

ShoppeSimple will also append web analytics campaign IDs into all clickthrough links, allowing you to monitor your TransactionalRSS visitors after they have clicked through from their feeds. This technology will allow you to track customer behavior and measure the performance of your RSS
campaigns using your analytic tools like Google Analytics, Coremetrics, Omniture and more.

Social media users – who are they, and what do they do?

from Shop.org

Many of us in the online retail space have discussed at length the many strategic and tactical aspects of designing, developing, and managing social media for our businesses (no less so right here within the Shop.org team!).  We wanted to step back and understand better who social media users at this point are (surely social media has evolved far beyond something just for teens or young singles, right?), and what they are doing (is it just connecting with friends, or – further to business purposes – are we also connecting more between retailers and consumers?). 

As part of our ongoing consumer research series, this month we asked consumers quite simply, “What do you do on social media sites (e.g. Facebook, Twitter, Kaboodle, or others)?”  A total of 4,034 adults over the age of 18 in the U.S. told us just that in a survey conducted in June 2009 by BIGresearch on behalf of NRF and Shop.org. 

Judging from the results, social media appears to be on the path to becoming increasingly mainstream media.  While there is much growth ahead yet, social media is by now woven into the lives of adults across age, sex, household income, marital and parental status, and region.  And while much of that activity to date centers on connecting with friends (both old and new), chatting, and sharing photos, consumers do recognize that social media is helpful for a number of shopping related activities as well. 

BIGresearch broke out the responses to this question into the overall respondent group (adults over the age of 18), as well as a second group, dubbed “social media users”.  A “social media user” is defined as any respondent who indicated that they did two or more things on the list of answer options provided.   

What did we learn about social media users?  Social media users skew somewhat more female than male.  Close to half are married, and another quarter describe themselves as “single, never married.”  They range in age, with a heavier concentration between 18 and 54 years, and heaviest use among 35 to 44 year olds specifically.  If one couples this data point with the knowledge that social media users skew female and that quite a few are married, one could surmise that social media users include a fair number of moms, as well.  Social media users are found in every household income bracket, although with somewhat fewer represented in the $100,000+ bracket. 

How do these social media users specifically spend their time when using social media sites? (Shop.org members may download the full set of data results from the Shop.org Web site.)  A sampling of answers:   

• Connect with friends – 64.5%
• Share photos – 39.5%
• Reconnect with old classmates / friends – 39.1%
• Look for sales / promotions / coupons – 17.9%
• Look for product advice / recommendations – 13.3%
• I like to follow my favorite retailers – 8.4%
• Post ratings or reviews of shopping and dining experiences – 7.0%

So if you – or perhaps your senior management – have been wondering just who wants to engage with you and is looking for your product information via social media, it appears it’s just about everyone one would pass walking down Main Street.  The absolute numbers of course are still growing – but for retailers it’s increasingly an opportunity to connect with both existing and new customers, many of whom have real purchasing power and actively want to engage with you.  As a retailer, it’s up to you to show them that you really want to engage with them as well.  

As always, looking forward to your thoughts and comments on this subject. 

»According to a June 2008 Razorfish-authored digital consumer survey (1,006 individuals in the U.S. surveyed):

+“… 64% of connected consumers have customized the home page of their choice with content feeds…”

+Connected consumers are continuing to adopt Web 2.0 features … with 52% using RSS feeds with some regularity

+“All signs point to the continuing disintegration of “one-stop” digital destinations … we’ve found that they (consumers) … prefer using multiple destinations, and then aggregating media and services, via simple tools like RSS, into a highly personalized view of their digital world.”

»According to a March 2008 Universal McCann-authored digital consumer survey (17,000 active internet users in 29 countries):

+When asked “Thinking about using the Internet, which of the following have you ever done?”, 18.6% of U.S. users acknowledged subscribing to an RSS feed

When these individuals were asked how frequently they accessed an RSS feed , 25% responded “daily” while an additional 35% responded “weekly”

TransactionalRSS – From News to Commerce

 

• About ShoppeSimple

---

Ever have a radio you couldn’t turn off?  That’s advertising in our world today.  Sometimes it’s relevant, sometimes it’s not.  Sometimes, someone’s shouts cut through the din and make you pay attention.  Most of the time, it’s just there — in signs and logos and banner ads and email blasts and TV spots and hyper-contextual social links and alerts from friends about their favorite brands.

The consumer doesn’t choose.  It’s simply there.

What would the model look like if you gave consumers back their rights to choose what they see?

First, you’d want to know when the best deals were happening.  And you’d want to check them out on your schedule, when you are interested in, say, a new summer dress or a nephew’s birthday present.

Ideally, you wouldn’t want to give up your name, address and email to get the deal — you shouldn’t have to — when you’re ready to buy, you’ll buy.  And you’ll get those offers  where and how you want them — in a browser, on the web, by email, in a mobile device, or through a social network.

That’s what ShoppeSimple has done with TransactionalRSS(tm). TransactionalRSS uses RSS technology in a consumer-friendly way to drive more on-line business. ShoppeSimple uses TransactionalRSS to take the user control, anonymity and platform independence of RSS to create a seamless, superior consumer shopping experience.

And when the consumer gets to choose when they’re paying attention, they’re more likely to buy.

Check out the first iteration of the ShoppeSimple experience at sites like Peruvian Connection and Botanic Choice. Look for the ShoppeSimple logo and click to visit the hub to see TransactionalRSS at work.

And watch for the new ShoppeSimple.com in the next few days.

Add comment June 26, 2009

There’s Something Happening Here

ShoppeSimple(tm) started with the simple idea that advertising works best when customers are paying attention. And they pay attention when they can choose when and how they connect with merchants, whether it’s on the web, in a browser, on social media sites or on a mobile phone.

Transactional RSS(tm) (TRSS) makes it possible.  ShoppeSimple opens the TRSS opportunity in ways that are really simple for consumers and that can really work for merchants.

The company is moving fast — expanding features and adding new clients coming into the ShoppeSimple community (check out RSSCheck.com for even more information about the company).  This blog will track that growth, and in the process, we’ll share news, stories and insights into marketing and TRSS from the ShoppeSimple team.

Check out www.ShoppeSimple.com.  Let us know what you think. Put us in your reader and watch this space.

50% Of Google's Self-Serve Advertisers Don't Come Back The Following Year

Siliconalleyinsider.com

Around 50% of all search advertisers that buy their ads directly from the search engine companies, including Google (GOOG), don't do it again the next year, according to a new study. Businesses like Yodel, ReachLocal and LookSmart lose 60% of their local advertisers each year.

The news could mean greatly diminished growth prospects for Google and its competitors.

In 2006, Google (GOOG) said local advertisers would spend $10 billion on Google search ads by 2010. But this new study, commissioned by Clickable and carried out by Borrell Associates, reports that local businesses won't spend more than $5.3 billion online until after 2013.

Until now, the explanation for such slow adoption from local advertisers -- the kind that made local newspapers cash cows for years -- has been that local businesses are slow to adopt new technologies.

In 2006, Google exec Sheryl Sandberg explained the challenge:

We think the [local] market is widely under penetrated. It sounds surprising to a lot of us, but even in the United States, arguably the most developed market in the world for ecommerce less than 50% of businesses even have a Web site, or let alone advertisers, so we think there is tremendous opportunity to bring those people online and bring them into our advertising product.

Clickable's study suggests a new -- and for Google, alarming -- possibility. When we learned the bit about how 50% of all self-serve search advertisers don't do it again the next year, we wondered: Maybe these local advertisers have tried to get on board -- advertising their businesses on search engines Google and Yahoo -- but decided their marketing money was better spent elsewhere.

Clickable, which paid for the study in hopes of turning up new new sales leads, sees the results differently and says the problem is that without a handy service like Clickable, local advertisers have a difficult time measuring the return on their search ad-buying investment. So they should become Clickable customers.

But Borrell CEO Gordon Borrell sees it more our way. He told the WSJ that the problem is that for local businesses, search advertising is more expensive than it should be. “Search advertising has been over-hyped and over-sold to local businesses,” he said. He also noted that over-charging middlemen, known as affiliate marketers, are part of the problem.

If it's true that the multi-billion dollar local advertising market is not "under-penetrated" as Google has always argued, and that local businesses are simply uninterested in search advertising because it doesn't generate enough return on investment, the growth prospects for search engines companies like Google must be considered greatly diminished.