Thread by @minethatdata

1 - Now we're supposed to use technology to "deliver on customer personal empowerment"?

For the vendors out there who read this (the majority of my audience), try reading the quote above as if you were a Marketing Director at Shopko.

How does the quote read to you?

2 - The customer purchasing at Shopko is several steps removed from "personal empowerment".

There's nothing quite so empowering as having a seamless omnichannel experience while buying sweat pants at Shopko.

3 - Out here on Twitter, you need two things ... a filtering mechanism to remove a vendor-centric view of shopping ... and you need a merchandise-centric view as seen through the eyes of a customer.

4 - An example. I performed a customer analysis for a Professional Sports team. This team had a "seamless omnichannel customer experience" integrating online/offline channels with marketing strategy and merchandise alignment. A thing of beauty, a pundit might think.

5 - One problem. Sales were extremely aligned with "winning".

6 - If the team won 30% of their games, they sold 0.4x units.

If they won 50% of their games, they sold 1.0x units.

If they won 70% of their games, they sold 1.6x units.

If they were elite, they sold 3.0x units.

7 - So a vendor-happy omnichannel customer experience might lead to a +/- 5% increase in sales. When the team was bad, a 0.4x unit volume became a 0.42x unit volume ... close to meaningless.

But winning? That made a difference!!

8 - The same thing happens at Macy's or Best Buy or Warby Parker. Think of the latter ... they're considered a trendy brand (i.e. they're "winning"). Macy's? Not a "winning" brand.

9 - I worked for a retail brand that was having a third-consecutive lousy year. Really lousy. And nobody within the company realized it (except for the CEO and CFO). You'd hear a merchant or a marketer say "We're doing fine" in meetings.

They were not doing fine.

10 - So I converted their profit-and-loss statement into an NFL-style won/lost record.

I showed that the past three years yielded 8-8, 5-11, and 4-12 seasons.

The Executive Team nearly lost their minds when they saw me write that they were a 4-12 team.

11 - I was told to be in the Executive Conference Room at 8:30am the next day ...

... they weren't happy.

"WE'RE NOT A 4-12 TEAM ... LOOK AT WHAT WE ARE DOING".

Of course, I was ready for this. I brought p&ls for competitors, and converted their data to won/lost records.

12 - Then the room got really quiet ... and then the team set up a "war room" to cause change to happen.

The room realized that their focus on a seamless / frictionless omnichannel customer experience did not stop the losing.

13 - Why mention all of this?

Vendors have very good solutions ... solid solutions ... credible and important solutions. Their solutions can make my client base a lot of profit.

But the profit pales in comparison to having a "winning strategy".

14 - What I see increasingly is less and less focus on having a winning strategy - and more and more focus on running 2-3 plays out of 70 per game that are fancy and shiny, plays that get attention (i.e. an influencer marketing campaign, or a $10,000,000 omnichannel investment).

15 - Winning is important. Focus on details. Great high-performing existing merchandise. Fabulous new merchandise that customers can't wait to see. A marketing strategy centered on customer acquisition. These things are far more important to my client base than vendor ideas.

16 - Until we refocus retail on having a "winning season" instead of having a "winning play or two" ... we'll over-focus on vendor solutions and under-invest in the stuff that really matters.

Any questions?
KH