Why Proximity Mobile Payments Are Good for Business (Part One)

For a few years now there have been experts recommending that businesses should invest in the equipment that allows customers use their smartphones to make point-of-sale payments for goods and services at restaurants and brick-and-mortar retail stores.

However, given the many potential roadblocks, it is not surprising that many businesses took a wait-and-see approach before making any investments in this type of technology.

That was, until last month.

When Apple announced that the new iPhone 6 would include near-field communication (NFC) and Apple Pay, in my opinion, one of the biggest obstacles to proximity mobile payment adoption was eliminated.

This doesn’t mean that it is a given that proximity mobile payments will be embraced by a majority of consumers right away. But, there are several reasons why now might be the time to make the investment, particularly if the business is located in an urban or suburban area. These reasons include:

The number of smartphones with NFC is increasing.

According to comScore, 174 million people in the U.S. owned smartphones (72 percent mobile market penetration) during the three months ending in August 2014.

What is of particular interest is that at the end of August, 42 percent of the U.S. smartphone subscribers used a device that was made by Apple. That means that at the end of August at least 42 percent of smartphone users in the U.S. couldn’t make NFC enabled proximity mobile payments, even if they wanted to.

Last month’s announcement doesn’t mean that all 42 percent of Apple smartphone users will now have access to NFC technology. It is going to take some time for customers to make the transition to the iPhone 6 or iPhone 6 Plus. However, according to Forbes.com, Apple has sold over 21 million new phones in the first two weeks, 10 million of those in the first three days alone. And, with the holiday season just around the corner, that number is bound to increase sharply by the end of the year.

When combined with the fact that many of the other smartphone manufacturers offer some NFC-enabled smartphones, the percentage of consumers who will be able to take advantage of proximity mobile payment options is much higher today than it was not too long ago, and that percentage will only continue to increase.

The number of mobile wallet options is increasing.

There are several Android mobile wallets (e.g., Softcard, Google Wallet, etc.) out there. Now that Apple has introduced Apple Pay, consumers will have more opportunities than ever to take advantage of proximity mobile payments when a restaurant or retailer makes the option available to them.

Major brands are working together to increase awareness.

As usual, Apple has done a great job introducing Apple Pay to consumers.

But, they are not the only brand trying to create awareness of proximity mobile payments.

In a recent article on eMarketer.com, Matthew de Ganon, Senior Vice President, Product and Commerce at Softcard, reports that Softcard currently has about 20,000 activations per day. This success is due in part to the fact that Softcard was created under a partnership with AT&T, Verizon Wireless and T-Mobile.

“We’ve had great success with consumer education through our partner stores, the carriers: Verizon, AT&T and T-Mobile,” states Mr. de Ganon. “They educate consumers on the mobile wallet, what it means and how they can tap to pay.”

“A majority of consumers assume at some point they’re going to have a mobile wallet that will allow them to pay for goods and services, but only a very small percentage actually knew that it was already here,” Mr. de Ganon continues.

More consumers are moving to 4G smartphones.

Having access to high speed wireless data is very important to the adoption of proximity mobile payments.

If it takes too long for a transaction to process, there is a good chance that the customer will abandon the transaction or choose an alternative payment option. If this happens with frequency, the consumer will most likely lose interest in using proximity mobile payments altogether. That is why having access to 4G is going to be crucial to the success of this emerging technology.

The good news is that according to Ovum research, 4G connections in North America are quickly rising.

Citing the Ovum research data, an article on cellular-news.com reports, “With 127 million LTE connections, of which 15 million LTE connections were added in the second quarter alone, North America leads the world’s regions in the number of connections, market share and penetration of LTE, with a 33 percent market share of all 391 million mobile connections.”

Again, with the holiday season right around the corner, this number should increase even higher by the end of the year.

Final Thoughts

As shown, there are many factors that are coming together to make proximity mobile payments a viable and smart business decision.

Just the fact that Apple has entered the market is a great signal that now is the time to look into this technology. As Lance Whitney points out in a February 2014 article on CNET.com about NFC-enabled cell phones, “…Apple typically likes all of the pieces to be in place before it dives into a burgeoning technology.”

Still not convinced? In the next post I will explore how offering proximity mobile payments can benefit your business beyond the obvious convenience of offering an additional payment option.

Photo credit: Omar Jordan Fawahl on Flickr on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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The Importance of Training Employees About the New Uses of Technology

The Deer in the Headlights Look

We have all seen it.

In fact, we have all probably displayed that look on our faces at one time or another.

For those of us who are early adopters of new technology, we know this look all too well. It’s the look on the faces of frontline employees (e.g., salespeople, clerks, bartenders, waiters, etc.) after a customer asks about a new use of technology that the employee was not adequately trained on.

As an early adopter of many new mobile technologies, I have learned to expect to see this look from time-to-time.

However, as time goes on and more people become comfortable trying new technologies, it is going to become more important for businesses to not only try new things, but also provide employees with the proper training so that customers are provided the customer service and buying experience that will set the business apart from the competition.

A few years back, this was a topic that many marketing experts and business consultants were talking about. As time moved on and the experts got more specialized in their expertise, I personally have heard this advice mentioned less frequently.

However, as more businesses have begun using technology for everything from product development to product delivery, this advice is still as important today as it was then.

Having employees who are not trained properly is going to lead to frustration and delays in transaction time. This inevitably will lead to decreased customer satisfaction and fewer future sales.

On the other hand, having employees who are properly trained to use the latest technologies will save the customer time and thus make the business transaction more enjoyable, which will have a positive impact on customer satisfaction and retention. In the end, this will have a positive impact on the business’s bottom line.

Photo credit: Brian Bilek on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Online Video Marketing – Just What the Doctor Ordered

If your business isn’t utilizing online video to market your products or services, you are probably missing out on a great opportunity to connect with your customers and potential customers.

A research report that was published last year by the Pew Research Center’s Internet & American Life Project points out that the percent of online adults who watch or download videos has grown in recent years, increasing from 69% of adult internet users in 2009 to 78% in 2013. This number is even more important given the fact that the number of adults who use the Internet is also growing.

According to the report, the increase in online adults who post, watch and download videos is being driven by mobile phones and video-sharing sites like YouTube.

However, as David Meerman Scott points out in his book, titled “The New Rules of Marketing & PR,” increased access to high speed Internet connections and technology that make it easy for anyone to create and upload video content also had something to do with the growth in online video usage.

Special Effects Not Required

If you check out what the big brands like Coca-Cola, Red Bull, or Old Spice are doing with online videos, you might get the impression that a huge budget is required for success.

However, that’s just not true. In fact, brands can be successful without all the Hollywood-style special effects, just ask Blendtec. (They were able to create viral videos with little more than a man in lab coat and a blender.)

The Hidden ROI of Online Videos

As is the case with all online content, online videos can have a positive effect on the business’s bottom line in other ways, as well, including decreasing operating expenses. This can be achieved by creating educational videos that help customers use the business’s product.

For example, take a look at what the Rug Doctor is doing with its YouTube channel. Even though the product is relatively simple to use, in my opinion, the directions that they include when you rent a Rug Doctor do not offer enough explanation on how to use their product effectively. While they fail in creating easy-to-use written instructions, they do an excellent job with their YouTube channel. The videos don’t look like they cost the company very much to make, but as the number of views testify, they have success demonstrating how the product is used.

As of today, one the basic educational videos that explains how to use a Rug Doctor has been viewed by over 435,000 people on YouTube. Just think about how much staff time it could have potentially saved the company if even half of those people didn’t have to call to ask questions. Not only that, think of all time they may have saved those same customers. That’s just good business.

The fact that this many people viewed the Rug Doctor’s videos does not come as a surprise when you look at online video trends.

According to the Pew Research study that I previously mentioned, educational videos are among some of the most widely viewed online video genres.

Final Thoughts 

Many experts recommend that businesses of all sizes use online videos in their marketing efforts for a wide range of reasons.

The Pew Research study reinforces the fact that consumers are already watching video online. This is not going to change any time soon. In fact, as the Internet gets faster and more options are available to reach your customers and potential customers, it will become not only a recommended tool in your marketing toolbox, it might become the key to success.

Photo credit: jm3 on Flickr on Flickr.

Video credit: Pew Research Center

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Using Sexual Imagery to Sell to Female Consumers

When creating a marketing campaign, particularly one that uses sexual imagery to sell the product, it is important to consider what you are selling and to whom you are selling to.

In his book, titled “Words That Work: It’s Not What You Say, It’s What People Hear,” Dr. Frank Luntz points out that, “You can have the best message in the world, but the person on the receiving end will always understand it through the prism of his or her own emotions, preconceptions, prejudices, and preexisting beliefs. It’s not enough to be correct or reasonable or even brilliant. The key to successful communication is to take the imaginative leap of stuffing yourself right into your listener’s shoes to know what they are thinking and feeling in the deepest recesses of their mind and heart. How that person perceives what you say is even more real, at least in a practical sense, than how you perceive yourself.”

However, this is something that businesses often fail to do.

As I pointed out in a recent post, businesses have often used sexual imagery in the ads that aired during the Super Bowl.

However, the over-the-top use of sex to sell has created a backlash from female consumers who claim that some of the ads are just plain sexist. Given the purchasing power that female consumers have, especially for certain products, businesses like GoDaddy have been forced to create Super Bowl ads that appeal to both men and women.

This made me wonder whether or not sexual images really do help sell products, particularly when many potential customers are female.

To answer this question, let’s first look at it from a more general perspective.

Does Sex Really Sell?

If the number of companies using sex to sell is any indication, then the answer is yes.

In a 2012 article, Dr. Tom Reichert, professor and head of the department of advertising and public relations in the UGA Grady College of Journalism and Mass Communication, points out that, “Advertisers use sex because it can be very effective. Sex sells because it attracts attention. People are hard wired to notice sexually relevant information so ads with sexual content get noticed.”

The article goes on to point out that the use of sex in advertising has increased over the years. In fact, Dr. Reichert reports that although sex is primarily used to sell low-risk products purchased on impulse, the use of sex to sell everything from alcohol to banking services has increased in recent years.

The article specifically points out that much of the growth in sexual imagery, particularly in print advertising, was used to sell alcohol, entertainment and beauty products. And, with the exception of entertainment advertising, an overwhelmingly majority of sex-selling advertisements feature female models.

With the advent of social media, businesses may need to rethink this strategy. This is particularly true when female consumers are the ones using their product or service.

However, this doesn’t imply that sexual imagery is completely off limits when selling products or services to women.

Women’s Reactions to Sexual Stimuli

A recent study that was published in Psychological Science, titled “The Price Had Better Be Right: Women’s Reactions to Sexual Stimuli Vary With Market Factors,” provides some interesting insight into when and why it would be appropriate to use sexual imagery to sell to women.

The study, conducted by Dr. Kathleen Vohs, Dr. Jaideep Sengupta, and Dr. Darren Dahl, finds that, “As predicted, women found sexual imagery to be distasteful when it was used to promote a cheap product, but this reaction to sexual imagery was mitigated if the product promoted was expensive. This pattern was not observed in men. Furthermore, we predicted and found sexual ads promoting cheap products heightened feelings of being upset and angry among women. These findings suggest that women’s reactions to sexual images can reveal deep-seated preferences about how sex should be used and understood.”

According to Dr. Vohs, Land O’Lakes Professor of Excellence in Marketing at the University of Minnesota Carlson School of Management, “Women generally show negative attitudes toward sexual images. Sexual economics theory offers a reason why: The use of sexual imagery is inimical to women’s vested interest in sex being portrayed as infrequent, special, and rare.”

Final Thoughts

Although the use of sexual images in advertisements has increased in recent years, businesses may need to rethink this strategy. This is particularly true if many of their potential customers are female and the product that the business is selling is relatively inexpensive.

However, as the study cited above points out, sexual imagery can still be an effective marketing tool when targeting female consumers if the product is perceived to have high value and is therefore consistent with the way women typically think about female sexuality.

Photo credit: Hard Seat Sleeper on Flickr.

Video credit: Time Inc.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Not Your Father’s Super Bowl Ads

In recent years, when you tuned in to watch the Super Bowl, you could expect to see some beer commercials, car commercials, an occasional movie trailer, and a GoDaddy commercial or two that featured scantily dressed women who encouraged viewers to host their web sites or register their domain names with GoDaddy.com.

This year, you shouldn’t expect the scantily dressed women—at least from GoDaddy.

Last fall, GoDaddy announced that in 2014 they are going to take their advertisements in a new direction.

According to a press release issued in October of 2013, GoDaddy confirmed that this year’s Super Bowl commercials won’t have the risqué innuendo viewers expect to see in a GoDaddy Super Bowl advertisement.

The press release states that “GoDaddy’s marketing has evolved with the company’s overall transformation under new CEO Blake Irving, who is committed to maintaining GoDaddy’s edge, but in a way that speaks inclusively to the customer base and demonstrates the value the company provides to small businesses and entrepreneurs.”

In other words, GoDaddy is making an effort not to alienate women.

Less Cheesecake Is Good for Business

A recent Adweek article that was written by Kat Gordon points out that Super Bowl ads typically haven’t done a good job reaching female viewers.

According to Gordon, “Sadly, so far the track record of the work has been pretty degrading in their depictions of women. In 2013 we saw waitresses turned strippers, scantily clad women tackling each other in the dirt, and a supermodel sloppily kissing a computer programmer.”

“Those were the major marketing fumbles of the day,” continues Gordon. “Not only were these ads off-putting to women, but many men also tweeted their wish for something other than lowest-common denominator creative. And the old adage that “sex sells” is being refuted with research that says that brand recall dips when the brain is busy processing ta-tas.”

That alone would make some brands take note. However, it is some of the other statistics that Gordon points out that may have caused GoDaddy and other brands to show a little less skin this year.

“According to Nielsen demographic data, 46 percent of the Super Bowl viewing audience is female, and more women watch the game than the Oscars, Grammys and Emmys combined,” writes Gordon. “She-conomy.com reports that women influence the majority of consumer spending across all categories, and onlineMBA.com published a report that found women comprise the majority of Twitter users (59 percent). Finally, women out-tweet men by 60 percent, per a study of 1,000 British Twitter accounts by Brandwatch.”

This points to the fact that female consumers are not only very influential when it comes to making purchase decisions, they are very vocal about it.

This makes the female consumer a force to be reckoned with.

That would explain the fact that this year’s Super Bowl ads are going to feature a lot less cheesecake and a lot more beefcake.

Note: For additional information about what to expect in the 2014 Super Bowl ads, check out this USA Today article.

Final Thoughts

Each year, brands spend millions of dollars to reach consumers during one of the most watched events of the year.

Given the fact that nearly half of the Super Bowl viewers are female and they tend to be the most vocal online, it is not surprising that brands have stopped ignoring this important demographic and started to create ads to meet their expectations and desires.

In 2014, it is important that brands create ads that appeal to both men and women in an effort to maximize their return on investment.

Photo credits: Rocky Mountain High and torbakhopper on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Seven More Things That Will Influence Business in 2014

It’s a new year.

That means it is a good time to look ahead and try to predict what businesses will need to focus on in order to stay ahead of the game.

As I was thinking about this post, a few things occurred to me.

First, many of the things that I have on my list are things that people have been talking about for a few years. This may be due to the fact that technology is finally catching up to the hopes and dreams of innovators around the globe. This could also be due to the fact that smart people try to think in terms of what the world will be like 10, 20, or 30 years from now, and plan their short-term goals so that they are meeting the needs of consumers now and in the future.

Second, the lists that we make each year don’t only apply to the year ahead. They build off the past and hopefully look to the future. Therefore, it is not surprising that the items on last year’s list could easily be on someone’s list for 2014.

Third, although now is a good time to look ahead, smart businesses need to be doing this all year long. Because technology is advancing at such a fast pace, something new could be invented or released mid-year that could change the direction of business.

The List So Far

As I mentioned, the things I was watching in 2013 are still relevant in 2014. Therefore, instead of creating a whole new list, I am just going to add to it. For review, here is the 2013 list:

1) Rapid Advancements in Technology

2) Mobile (User Experience and Marketing)

3) Mobile Payments

4) Mobile-Influenced Merchandising

5) Privacy Issues

6) The Evolution of Marketing and Public Relations

7) Emerging Markets

Note: As I do each year, I suggest checking out the “100 things to Watch in 2014” list published by JWT Intelligence. As was the case in the past, this year’s list has some very interesting predictions.

Additional Things I Will Be Watching in 2014

While this is by no means a comprehensive list, here are some additional things that I think businesses should be watching this year.

8) Internet of Things The definition of the Internet of Things is not completely agreed upon. That said, my definition is most aligned with the definition provided by SAP. According to Wikipedia.org, SAP’s definition of the Internet of Things is, “A world where physical objects are seamlessly integrated into the information network, and where the physical objects can become active participants in business processes. Services are available to interact with these ‘smart objects’ over the Internet, query and change their state and any information associated with them, taking into account security and privacy issues.” This will not only change business, it will change how we live. (The most common example that I have heard about is the refrigerator that can tell you when you are out of milk. This technology can and is being used to help companies meet the needs of consumers in all areas of life.)

In the short-term, the use of this type of technology can help companies gain a competitive advantage over the competition. In the future, this type of technology will be table stakes.

9) The Evolution of Retail It is inevitable that advancements in technology will change the way people shop. In order for brands and retailers to compete, they are going to have to take many variables into account and offer creative ways for consumers to purchase products and services from them. Last year, I pointed out that mobile phones are influencing the way people shop at brick-and-mortar stores. But the changes don’t stop there. Innovative companies have found ways for consumers to purchase products from them in ways that we never thought possible. Need some examples? Look at number 11, 14, 59, and 79 on the JWT Intelligence “100 Things to Watch in 2014” list.

10) Omni-Channel Retail Although this is part of the evolution of retail, it is important enough to be included by itself. According to Wikipedia.org, “Omni-Channel Retailing is the evolution of multi-channel retailing, but is concentrated more on a seamless approach to the consumer experience through all available shopping channels, i.e. mobile internet devices, computers, bricks-and-mortar, television, radio, direct mail, catalog and so on. Retailers are meeting the new customer demands by deploying specialized supply chain strategy software.”

As Wikipedia points out, “With omni-channel retailing, marketing is made more efficient with offers that are relative to a specific consumer determined by purchase patterns, social network affinities, website visits, loyalty programs, and other data mining techniques.”

Note: Some people have used the phrase onmi-channel marketing. However, it looks like more people are going with onmi-channel retail. It seems like they are basically talking about the same thing (i.e., not only having the brand reach consumers via multiple marketing channels, but having each of the channels know how the customer interacted with the brand in the past.)

11) A Global Marketplace Thanks to the latest technology, we have access to and can sell products to consumers located in all areas of the globe. However, the Internet is not making us homogeneous. In fact, as I pointed out in a post last year, research has shown that the Internet may reinforce regional differences. The key is knowing what customers want and filling their needs. This is going to call for increased awareness of the needs of each demographic group (region, political affiliation, income level, educational attainment, etc.) in the market(s) that you are selling to.

The flip side of the coin is that businesses around the globe can now compete for your local customers, increasing the need for improved efficiency and quality, not to mention having an effect on how you price your products and services.

12) 3D Printing Wikipedia.org defines 3D printing as, “a process of making a three-dimensional solid object of virtually any shape from a digital model.” The rapid improvement of this technology has made it economically feasible for people to use it to create a wide variety of products. With it, the technology brings a host of legal and security concerns that need to be addressed. If 3D printers become inexpensive enough, this technology has the potential to change business as we know it today.

13) Cyberattacks By now, everyone has heard about hackers attacking companies and getting access to customers’ personally identifiable information (PII). When this includes customers’ financial information, it can cause a public relations nightmare. However, now that we are connecting things that we use in the terrestrial world to the Internet (see #8, The Internet of Things), just think about the problems that could arise. This is something that all businesses need to think about. This is even more important for companies that are helping bring the latest technologies to our homes and offices.

14) Ethics This is something that all businesses should be thinking about. In fact, it is going to become more important as time goes on. Businesses that deliver a quality product while being friendly to employees, customers, and the environment are going to win in the long term. And, when it comes to using the latest technology for business, companies that push the envelope are often going to be rewarded. However, businesses that go too far and make customers uneasy or upset could feel the financial impact. While I am often an advocate for using the latest and greatest technology, I am also aware that sometimes just because we can do something doesn’t mean that we should. A little forethought can go a long way.

Final Thoughts

So there you have it. My list of things that I will be watching in 2014 and beyond.

Is there something that you think that I should have included? If so, please let me know…

Photo credits: Zach Copley and Samuel Mann on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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A Huge Social Media Fail—Or Is It?

In the short history of social media marketing we have seen a lot of brands post things on the Internet with the hope that the content would resonate with consumers only to have it backfire.

In May, BuzzFeed posted an article, titled “19 Companies That Made Huge Social Media Fails.”

The list includes many examples that leave you shaking your head and saying to yourself, “What were they thinking?”

Now, let’s face it, it is very tempting for brands to join the conversation when news breaks in order to gain exposure for their brand with very little time or effort involved.

If the event is positive or lighthearted in nature, then joining the conversation is just good business. (Oreo showed how to do it right earlier this year after the lights went out at the Superdome during the Super Bowl.)

As Mike Mikho suggests, even negative events that involve celebrities can be fair game. (I’d add that this is true only if no one is seriously injured.)

However, if consumers’ conversations are focused on tragic events (e.g., terrorist attacks, school shootings, natural disasters, plane crashes, etc.,) then joining the conversation might not be the best thing to do. Saying the wrong thing at the wrong time can create a huge headache for your brand.

In my opinion, the best thing brands can do to when a tragedy happens is to remain silent for a while. (And, yes, this means delaying those automated posts that were planned in advance.)

If you feel that a comment is required, pay your respects to the victims or find ways to be helpful without being self-promotional. This is a good rule to follow if your brand doesn’t want to find itself on a list similar to the one BuzzFeed posted.

Some Rules Are Meant To Be Broken

Having a lot of people criticize your brand for saying something insensitive is generally not a good thing. And, showing up on a social media fail list probably isn’t going to help generate sales.

That is, unless you’re Kenneth Cole.

If you go back to the BuzzFeed list, you will see that Kenneth Cole was number 1. Kenneth Cole earned a spot on the list by making light of the protests in Egypt in 2011 by posting this on Twitter: “Millions are in uproar in #Cairo. Rumor is they heard our new spring collection is now available online at http://bit.ly/KCairo -KC”

The tweet created its own uproar—this time on the Internet. (This was exacerbated when pranksters added the tweet to the window on the Kenneth Cole store in San Francisco.)

According to CNN, Kenneth Cole apologized within an hour of posting the tweet. Cole is quoted as saying, “We weren’t intending to make light of a serious situation. We understand the sensitivity of this historical moment.”

Cole then posted on his official Facebook page, “I apologize to everyone who was offended by my insensitive tweet about the situation in Egypt. I’ve dedicated my life to raising awareness about serious issues, and in hindsight my attempt at humor regarding a nation liberating themselves against oppression was poorly timed and absolutely inappropriate.”

However, as it turns out, while the tweet may have been considered inappropriate by some consumers, it also was good for business.

In the October issue of Details, Cole is quoted as saying, “Billions of people read my inappropriate, self-promoting tweet, I got a lot of harsh responses, and we hired a crisis-management firm. If you look at lists of the biggest Twitter gaffes ever, we’re always one through five. But our stock went up that day, our e-commerce business was better, the business at every one of our stores improved, and I picked up 3,000 new followers on Twitter. So on what criteria is this a gaffe?”

Given this, it is not surprising that Cole used the same tactic again when he tweeted this about the Syrian crisis in September of this year, ““Boots on the ground” or not, let’s not forget about sandals, pumps and loafers. #Footwear”

Again, it had people criticizing Cole for being insensitive.

And, that is most likely what Cole wanted people to do.

Why It Works for Kenneth Cole

So, why does it appear that Kenneth Cole gets rewarded for saying something on social media that would have a negative effect on other brands?

Is it the type of product that he sells? Maybe.

Is it the type of consumer that he is selling to? Could be.

Is it because social media is a nonissue? I’d argue no, because the data he presents show that his shocking statements on social media actually generated business.

Could it be that we are trying to be too politically correct and Kenneth Cole’s customers are supporting someone who stands up and says screw conventional thinking and is willing to take a risk and make fun of a horrible situation? Could be, but I doubt it.

Is it that all press is good press? Maybe.

So what gives?

First, we need to remember that social media is just a vehicle for people to get their message out to the world.

Before social media, people were saying things that made other people criticize them. Kenneth Cole is no exception. In fact, Kenneth Cole Productions, Inc. is known for its controversial and sometimes tasteless advertising.

On the other hand, Kenneth Cole Productions, Inc. is also known for its involvement in charity and social causes, including its involvement in the search for a cure for HIV/AIDS. Its target audience might be aware of this, which could explain why Kenneth Cole is given a pass when other brands would suffer.

But, then again, others would point out that the controversy Kenneth Cole creates actually helps the business.

The reason for this is something that I can’t quite explain. It could be a combination of many different factors that can’t be controlled for.

What I can say for sure is that this tactic is only going to consistently work if the brand delivers a great product in the first place. And, there is where I think the real answer is. Kenneth Cole makes great clothes. So, therefore, Kenneth Cole Productions, Inc. might be able to get away with things that other brands can’t get away with.

In the end, I wouldn’t recommend using Kenneth Cole Productions, Inc. as a role model for your online communication strategy. That is, unless you can deliver great products on a consistent basis and are willing to respond to complaints from consumers who might not be so forgiving.

Photo credits: mikest and davitydave on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Lessons American Retailers Can Learn From a Store Over 8,000 Miles Away

Whether you love them or hate them, nobody can argue with the fact that Walmart has been very successful at doing what they do.

This success can be partially attributed to the fact that Walmart has found ways to appeal to and meet the needs of working class consumers.

With over $328 billion in retail sales in 2012 in the United States alone, this retail giant has the money to spend on R & D to find out what their customers want. Everything that they do has been thought through, including the design of the actual “brick and mortar” stores. As retailers know, this can have a huge impact on sales.

A New Approach to Meet the Needs of African Consumers

In his book, “Africa Rising: How 900 Million African Consumers Offer More Than You Think,” Dr. Vijay Mahajan explains that global firms that have focused on Africa have primarily focused on the people he classifies as Africa One. These are the people with the most disposable income. However, they account for only about 5% to 15% of the people in the African market.

He goes on to point that in the near future, there are going to be huge opportunities for businesses that target the “future middle class” or what he calls Africa Two. This segment accounts for 35% to 50% of the African market, or roughly 350 million to 500 million consumers on the continent.

Dr. Mahajan explains that this market is comparable to similar segments of the population in India or China. He therefore uses examples from India to explain some of the opportunities as well as some of the obstacles that businesses will potentially face if they invest in Africa.

In one example he points out that Kishore Biyani, founder of India’s largest retailer at the time the book was written, divides India into three segments. His company, Pantaloon Retail (India) Ltd., focuses on India Two (i.e., the drivers, maids, and nannies who work for India One.)

“In targeting India Two, Biyani discovered that he needed to rethink his business,” writes Dr. Mahajan. “Customers in this segment were turned away by the neat and orderly aisles seen in retail stores in developed markets. Instead, they wanted the crowded chaos of an informal market. He created a store that felt cluttered and cramped, with produce covered in dust, which signified freshness to customers. In fact, he spent $50,000 transforming one of his original shining, Western-style stores in Mumbai into a chaotic marketplace. He has shown that the formula for success might look nothing like the one that is successful in the West. Using this India Two formula, he had built a $600 million business by mid-2007.”

Dr. Mahajan suggests that in order for businesses to be successful in Africa, particularly among consumers he classifies as Africa Two, businesses might need to set aside models designed for developed markets or the elite markets of Africa One, in favor of more chaotic models similar to the one that Biyani successfully used in India.

Walmart Knows How to Sell to the Working Class

There are several ways that American retailers can benefit from the information provided by Dr. Mahajan.

For example, they can examine whether investing in Africa might be a viable option for their business. As Dr. Mahajan explains, Africa is filled with potential business opportunities. The key is to actually give African consumers what they want, not what the business thinks that they want.

American retailers can also benefit by using the logic that Pantaloon Retail Ltd. used, but apply it to American consumers.

As is the case in other parts of the world, the needs of American consumers are going to vary based on income levels.

Given income constraints, consumers with less disposable income are probably not going to be purchasing expensive luxury goods. Therefore, stores that sell these products are going to want to design their stores to appeal to consumers with higher incomes. (Think Bloomingdale’s, Barney’s New York, Saks Fifth Avenue, or even Macy’s.)

However, everyone needs food and basic household supplies. Given the fact that about 50% of households in the United States had household incomes of less than $50,000 per year in 2011, we know that there is a huge market for businesses that can appeal to this segment of the population.

Appealing to this segment of the population is something that Walmart does well. In fact, 56% of Walmart’s customers have household incomes that are less than $50,000 per year.

Given the fact that Walmart has made a lot of money selling to lower income consumers in America, is it at all surprising that the retail giant has started making investments in Africa? In 2011 Walmart acquired a majority stake in Massmart Holdings Ltd. According to Walmart’s website, Massmart operates more than 350 stores in South Africa and 11 other sub-Saharan countries. I wouldn’t be surprised if that number continues to grow.

Final Thoughts

As Walmart has shown, if done correctly, a lot of money can be made by focusing on less affluent consumers in America. The same could easily be true in other parts of the world.

As Dr. Mahajan explains in his book, there are going to be many opportunities for businesses that invest in Africa, particularly those that focus on the “future middle class” or what he calls Africa Two. This segment of the population accounts for approximately 35% to 50% of the African market.

However, as the example of Pantaloon Retail (India) Ltd. demonstrated, retailers that are thinking about serving consumers in different markets and market segments may need to rethink the way that they design their stores in order to meet the needs of those consumers.

Given their success in selling to working class Americans, it is not surprising that Walmart has started to invest in Africa.

That said, there is still time for other retailers to follow Walmart’s lead and find ways to meet the needs of lower income consumers all around the world, particularly among those located on the African continent.

Photo credits: Wesley Fryer  and Rusty Clark on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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It Pays to Use These Shopping Apps

According to a recent article on Forbes.com, Apple reported that there are about 1.25 million apps in its app store, while Google boasts over 800,000 apps.

With this many options available, it is amazing that any individual app can find a way to stand out from the crowd.

When an app does gain widespread acceptance from mobile users, retailers and brands need to take note.

While I don’t have a specific formula for creating an uber-popular shopping app, I can tell you that a good place to start is by delivering value to users.

It is for this reason that I’d highly recommend shopkick and Ibotta to consumers, retailers, and to the companies that make the products that are sold at their stores.

Win, Win, Win With Shopkick

I’ve been a fan of shopkick ever since I bought my first smartphone in 2011.

As I pointed out in a post in July of 2011, shopkick provides a win, win, win for retailers, the companies that make the products that the stores sell, and most importantly, consumers.

Retailers that partner with the app benefit by the increased foot traffic that shopkick brings.

The companies that make the products that line the store’s shelves benefit by increased sales. Being included in the list of items to be scanned acts as an advertisement each time shopkick users open the app.

Additionally, companies that partner with shopkick to get their products included in the items that shopkick users scan to earn kicks often literally get their products into consumers’ hands. And, once they have the products in their hands, it is a lot easier for consumers to put the items in their shopping carts.

Furthermore, shopkick has added lookbooks to the app. These lookbooks give brands another way to advertise their products to customers.

Consumers not only benefit by earning kicks that can be exchanged for gift cards or other rewards, but they are also introduced to products that they might find useful in a fun and entertaining way.

Shopkick users can now also earn kicks for making purchases at participating retail stores. This not only helps users gain kicks faster, it helps stores link shopkick use to actual retail sales.

Not convinced about the value of shopkick? Then feel free to ask any of their over 4 million users what they think. I’m guessing many of the responses will be favorable.

Save Money With Ibotta

I’m a huge fan of the Ibotta app. In fact, I haven’t been this excited about a shopping app since I first was introduced to shopkick.

And, it appears that I’m not alone.

According to an article on TechCrunch, the app climbed to 100,000 registered users in the first 75 days following its release. That article was written in December of 2012.

While I don’t know exactly how many registered users it currently has, Ibotta has a loyal following. In fact, a recent survey conducted by Consumer Intelligence Research Partners (CIRP) found that Ibotta is one of the 20 most frequently used apps among smartphone and tablet users.

What is the reason for this success? That question can be answered by one word: value.

The easiest way to tell if anything is delivering value is by measuring whether or not it saves users money.

That it does.

I have been using the app for about a month and a half and in that time I have saved $43.00. (I use the app about once a week.)

Not only has it saved me money, it has also encouraged me to try some products that I normally wouldn’t have purchased—many that I will purchase again in the future. That is the goal of any good advertising.

What makes this different from shopkick is that users actually have to make a purchase to earn the reward. I would think that this is enough incentive for retailers and brands to want to get involved with this app.

The way the app works is that users are asked to do small tasks to earn the opportunity to get money back from the app after a specific product is purchased. Only products listed can be redeemed for cash and they have to be purchased from participating retail stores. (Purchases are verified by having users submit receipts and scan UPC codes that are on the products that they purchased.)

What makes the app more interesting is that Ibotta offers bonus badges to users who complete certain specific tasks (e.g., invite new users, buy a set number of specific products, transfer money earned on the app to PayPal, etc.) In some cases, these badges also come with a monetary reward. That makes the badges that much more valuable.

Final Thoughts

There are a lot of apps out there to choose from. This makes it difficult for any particular app to gain widespread acceptance.

When shopping apps do gain acceptance, retailers and the companies that make the products that they sell can definitely benefit by their involvement with the app.

As explained by looking at two of my favorites, shopping apps can help increase foot traffic, increase awareness of different products or services, and even result in increased sales.

Furthermore, involvement in shopping apps could also be a creative way to help keep the non-shoppers occupied while the shoppers in a group shop.

While there isn’t a set formula to create a popular app, the best and most recommended way to do it is to deliver value. This is something that I feel both shopkick and Ibotta have accomplished. It is for that reason that I would highly recommend both apps.

To sign up for shopkick, click here. To sign up for Ibotta, click here. In both cases you get a bonus for signing up. And, if you use the links I provided, so do I. Thank you in advance.

Photo credits: Fruitnet.com  and Jay Reed on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Focus on the Non-Shopper to Increase Retail Sales

In an effort to increase the sales of their products and services, retailers need to focus on the whole shopping experience. This starts even before consumers see or hear the store’s advertisements and extends beyond the time that they actually use the products and services that they have purchased from the store.

When examining the shopping experience, a lot of effort is put into thinking about the needs of the shopper. However, it seems that some retailers forget the role that non-shoppers play.

The Role of the Non-Shopper

In his book, “Call of the Mall: The Geography of Shopping by the Author of Why We Buy,” (affiliate link) Paco Underhill identifies some of the challenges that retailers face.

“If an adult has to drag two sullen adolescents along for every step of a shopping expedition, you can be sure that the trip will end prematurely,” writes Underhill. “Whereas if those adolescents can be given some enjoyable outlet for their entertainment, they’ll let you shop as long as you want. The mere promise of a reward may keep them quiet. (Of course, when you’re ready to go you may have to drag them out of the mall.)”

“Yes, Dear.”

Even if a couple has the benefit of getting a babysitter to watch their children, the non-shopper in a couple can also present similar problems. In many cases, it is the male who plays this role.

Although there are exceptions to the rule, most men do not get as much satisfaction from shopping as their significant others do, unless they are in a sporting goods or electronics store.

If the mall has an electronics store (e.g., Apple Store, Best Buy, etc.) or even a book store, then the male can waste some time there. If he is lucky, there is a food court with a television set, or even better yet, a sport’s bar with all the entertainment that most men need.

However, if the store is not connected to a mall and there aren’t any other places to walk to, then the male is left to tag along like a puppy dog or wander aimlessly around the store until his significant other is done shopping. (Sure, if there is a men’s department, he can check that out. But, if he doesn’t want to make a purchase, that will only take a few minutes of his time.) This could result in the female shopper leaving the store before she wants to, which could cost the store money.

The solution might be as simple as providing an area where men can sit down and watch television. This could be enough to give the female the time she needs to shop. (As an added bonus, the area could be sponsored by a brand that caters to men. This would offset the cost of lost floor space, and possibly add to increased sales in the long run.)

Free Beer!

In 2011, a friend of mine posted this tip on Foursquare: “They give the guys free beer so they can relax while their wife/girlfriend shops!”

He was talking about a boutique store in Deer Park, Illinois. Not only did they give him something to do while his wife shopped, they created an experience memorable enough that he wanted to share it online. I’m guessing that his wife was able to take her time shopping. I would also guess that it wouldn’t be too hard to get him to go shopping with her the next time she visits this particular store.

It should be noted that this is not the only store to offer free beer to customers. Bill Hallman, a clothing store in Atlanta was featured in a 2006 Adweek article for doing the same thing. In that case, Peroni, an Italian import, paid the store for the privilege of being the beer served.

Final Thoughts

In many cases, when customers enter a retail store with the intent to make a purchase, they are accompanied by non-shoppers who can distract from the shopping experience. In some cases, this distraction can be so overwhelming that the shopping trip is ended prematurely.

It is for this reason that it would be in their best interest for retailers to focus some of their attention on the non-shoppers.

Retail experts have countless suggestions on ways to entertain the non-shoppers so that the shoppers have all the time that they need to accomplish what they set out to do.

In fact, many stores have already identified the role that non-shoppers play in the shopping experience and have found ways to entertain them so that they don’t become too big of a distraction. Among other things, it is not uncommon to have a restaurant or coffee shop near or within the retail store. And, as shown, when that is not an option, some small boutique stores have gotten creative with the way that they “distract” the non-shoppers within the group.

While it will vary by the type of store and where it is located, the important thing is that retailers find ways to entertain non-shoppers, as they may have a greater impact on the store’s bottom line than one might think.

Photo credits: Sai89AJ and jai MANSSON  on Flickr.

Chad Thiele

Marketing analyst and strategist, freelance writer, content curator, applied sociologist, and a proud UW-Madison alumnus. My goal is to help businesses achieve their marketing objectives and business goals while gaining additional experience in the exciting world of digital marketing. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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