1 - Alright, let's look at some enjoyable marketing / response relationships.

Say you spend $100,000 in Paid Social. Your ROAS is $3.00.

Are you making the "right" decision?

The answer is almost certainly "no", though it isn't your fault that the answer is "no". 2 - Both marketers and analysts don't have the right data to answer the question.

We need a framework to think about how ROAS changes as investment levels change. This kick-starts the analysis process.

Here is an example of how ROAS changes as investment levels change.

Read this thread, and switch "running backs" out for "loyalty programs".

For 95% of e-commerce brands, loyalty programs "appear" to work ... but don't fundamentally change rebuy rates or annual orders per buyer (which means they don't work).

https://twitter.com/JoeyIckes/status/1649459088428859413

This is the point in the discussion where some folks come after me ... "loyalty programs are proven to work, just read the study from Vendor X, they proved that loyal customers spend the most."

As Penny on the Big Bang Theory used to say, "oh honey".

1 - In the mid-2000s, there were all sorts of marketing blogs that catered to "customer service" concepts.

I made the mistake of discussing the importance of featuring sold-out items. Bloggers did not like this idea. "It's not a great customer experience." 2 - They'd harp on the fact that the items shouldn't have been sold out in the first place, and if they are sold out, they should be pulled from the website to prevent a bad "customer experience".

1 - So I have an interesting situation.

30% of last year's sales for this brand came from loyal buyers (0-12 month buyers with 5+ life-to-date purchases).

Also ... 30% of last year's sales came from new buyers, and the new customer count was down 15% from the year prior. 2 - When you present these findings to the Leadership team, they begin to salivate over the prospects of ... increasing customer loyalty.

1 - Myth: It costs 8x more to acquire a customer than to retain a customer.

This is a myth/lie perpetuated by vendors, researchers, trade journalists, and pundits/consultants to sell loyalty services. 2 - If you believe this myth, then why are you spending money acquiring customers?

Why wouldn't you reallocate all of that money that you are wasting and instead retain all of your existing customers?

Why aren't you doing that?

1 - A common refrain from the past two days.

Kevin - vendors aren't grifters.

Well of course they aren't "all" grifters.

The vast majority are not grifters.

But the small fraction of vendors who take advantage of my clients taint the vendor industry. 2 - There are many shades of grifting.

1 - Remember the Peter Brand quote from Moneyball.

"Okay. People who run ball clubs, they think in terms of buying players. Your goal shouldn't be to buy players, your goal should be to buy wins. And in order to buy wins, you need to buy runs."

Let's extend this to e-commerce. 2 - "Okay. People who run marketing, they think in terms of channels. Your goal shouldn't be to buy channels, your goal should be to buy profit. And in order to buy profit, you need to buy customers".

Classic trade teaser:

"Will Amazon and GrubHub take a bite out of Uber and DoorDash's food-delivery dominance?" I spoke at a conference about four years ago. There was an EVP of Marketing who actually talked like this.

He essentially memorized the teasers and talking points on each side of an argument, and then positioned his worldview based on one side of the argument.

Daniel is 100% right here.

Do this by Merchandise/Product class and you have something really revealing as well. I call the Merchandise/Product version of this a "Class Of" Table (i.e. measuring how items from the "Class Of" 2015 performed over time).

https://twitter.com/d_mccar/status/1528016843528622082

Most of the "Class Of" reports I run for clients demonstrate a problem with one class. There was a merchandising team that messed up - got fired - and then the new team messed up for a year as they got used to their new jobs.

The result is a couple of "lost classes".

Great Moments in Omnichannel History.

https://twitter.com/JonLemire/status/1526983451018244103

I mean, the trade journalist / retail pundit community absolutely fawned over Target the past three years after they ran screaming from Macy's when the omnichannel thesis crumbled into dust bunnies under a bed.

1 - So it is 2006 back at Nordstrom.

One of my teams is responsible for calculating the sales potential of every zip code in the United States. We used the predictions to prioritize markets for new stores and then the location of the new store. 2 - Sometimes you get a "vibe".

This team was not being treated the best, in my opinion. They did good work, but I could tell the work was not respected.

Welcome to analytics!

But still, something was "off".

I can't convince my readers that customer acquisition is important ... why do we think harder topics should be immediately embraced?

We're not wired to accept things that go against our tribe, our faith, our beliefs, or our self-interests.

Every one of us has issues.

https://twitter.com/DavMicRot/status/1512263028594593823

2 - I once met with a CEO, a popular television individual.

His business, possessing customers with an approximate 33% annual rebuy rate, was stuck ... and it wouldn't thrive without a refocus on customer acquisition. I had a decade of data on my side proving my point.

1 - So I went to Google to look up a communications platform, and just to torment me Google brings back a tweet from a vendor.

"78% of CEOs expect marketers to drive revenue, and you do that by tearing down organizational silos". 2 - When you read comments like this one, you kinda realize that so darn few professionals understand what the purpose of marketing is.

1 - This is a fun one.

I segmented customers based on historical gross margin percentage and life-to-date purchases.

The y-axis represents gross margin percentage over the next twelve months.

Tell me what the chart says to you. 2 - What's fun here is the hybrid behavior among the prior low-margin high-frequency buyers.

Future low margin activity happens for three reasons ... these customers buy from low-margin categories ... they buy liquidation products ... and they use loyalty points to purchase.

1 - A Marketing Director asked me a question a few years ago.

"Tell me what the next big thing is." 2 - My first response was "whaaaaa?"

So I asked the Marketing Director what she meant?

She said "where is the next place where I can spend money and cheaply obtain new customers?"

1 - So I'm in line to pick up my RV from a lengthy repair.

Next to me is a couple. They are speaking with their service rep.

They are not happy. 2 - This couple is FURIOUS.

It is clear from the conversation that the RV repair shop failed them.

It is also clear that the service rep gets yelled at six times a day and is numb to yelling.

1 - Let's talk about email marketing briefly. 2 - How would you "prove" that email marketing has value, ROI, profitability?

1 - A marketer said to me "you realize we're trying to improve customer loyalty because it costs too much to acquire a new customer and costs to acquire customers are increasing, causing problems." 2 - Let's work backwards here for a moment.

If you are able to get 40% of last year's buyers or less to purchase again in the next year, loyalty is too darn hard to achieve - you run an acquisition-centric brand. Your entire job is to acquire customers at an acceptable cost.

1 - There's so many things to consider in sports that the comments here deserve to be "unpacked" a bit, as the kids say.

We'll connect this to business in a moment.

https://twitter.com/mlombardiNFL/status/1471810719154946051

2 - Fourth and Goal ... on Sunday night, Green Bay goes for it and scores a touchdown. On Thursday night, the Chargers go for it and miss and end up with a player with a head injury. In fact, the Chargers left many points on the field going for it, likely costing them the game.

1 - As you already know, there are many different types of marketing professionals. 2 - There are classic brand-centric marketers. They skew to creative, to "big ideas", to intangible benefits. There are far fewer of these professionals today than there were in 1996.

1 - I mentioned a few days ago that digital marketers benefited from 25 years of cannibalization.

It was like there were two different economies happening.

A miserable one for old-school marketers.

A thriving one for digital marketers. 2 - If you were in my profession in the 1995 - 2010 timeframe, you saw the death of catalog marketing. My peers worked tirelessly while losing 5% of their sales per year to digital marketers who cannibalized the sales.