Baymard Institute recommends to place the main product categories directly in the main menu. This means that the level 1 navigation in the header menu (on desktop) or the burger menu (on mobile) is your main categories. That way, visitors can get a quick glance at what your site offers without having to click, hover, or scroll.
Here’s the best combination I figured out so far:
If you have about seven or fewer main product categories:
Show those categories directly in the header menu. Some websites managed to fit up to about 10 categories. However, I find that it looks overwhelming.
Each menu item one triggers a Mega Menu panel. Show the sub categories as columns – ideally 3 to 5). (See example)
Optionally show an image for each column, or for a few featured items. (See example)
If you have more than seven main product categories or a lot of sub-categories:
Have a single Shop button (or a similar label) which triggers a two-dimensional Mega Menu.
Alternatively, if you can figure out a simplified version of your categories, you can still show a handful of items at the top, and have a two-dimensional Mega Menu under each. (See example)
Show a collapsed Shop menu item for the product categories.
This month, the 48th edition of MTL+Ecommerce was held at L’Oréal Canada office in Montreal. For this occasion, we learn a bit more about how the world’s largest cosmetics company uses data and personalization to drive online growth.
What is the secret of L’Oréal Canada’s fast rise? How does a company that works for the first time in Canada arrive in less than 7 years to sell billions of its products (it reached 1 billion dollars this year!)?
In order to answer to all of those questions, L’Oréal brought up different people from its team dedicated to the digital marketing of the company:
Martin Aubut, CDO of L’Oréal Canada,
Douglas Sutcliffe, Head of Data Science of L’Oréal,
Estelle Ngo, Manager Precision Marketing of L’Oréal Canada,
Florent Dubois, Director Digital & e-Commerce Active Cosmétique (Vichy, La Roche-Posay).
THE DIGITAL REVOLUTION IS A CONSUMER REVOLUTION
The world is changing, and with the digital revolution, everything is going faster. Companies that have badly started their digital shift find themselves lagging behind and end up out of the competition.
A steel global corporation like L’Oréal has its own structure and its own “ecosystem”, and it might be difficult to try to transform it. So how to remain adapted to the digital age with a structure as heavy and already well established as L’Oréal?
HUMAN BEING AT THE VERY CENTER
Here what L’Oréal CEO said about the company vision: “drive a big company like a startup”.
Therefore, efforts to make the business even more competitive need to focus on the human being more than on the structure itself.
Whether it is in the way of managing human resources to make the business run smoothly or in the way it deals with consumers, L’Oréal is all about Human.
Like all other companies, the consumer is at the center of L’Oréal’s interest. Indeed, the consumer is no longer a passive buyer, he becomes active and participates in the evolution of the brand.
A MATTER OF CUSTOMER IDENTIFICATION
It is expected that by 2021, ecommerce will be the first growth opportunity for every business. Why? Because more and more people prefer to purchase online.
The company devotes 20% of its business strategy to develop its ecommerce platform. The rest is 100% brand love. Feelings, behaviors, habits: people who look for L’Oréal products are those who love the brand. In return, L’Oréal adapts itself to the needs and demands of its consumers.
In 2012 L’Oréal Canada started to deploy its ecommerce strategy. All the digital platforms used by L’Oréal were media of expression for their online consumers: social media, website, email marketing, digital content, etc. The company had to be familiar with its online consumers in order to better respond to their needs and to improve its efficiency. To get there, L’Oréal had to obtain customer engagement: What interests them? What makes them react? What are their consumption habits? Etc.
CONSUMER JOURNEY IS A FRONT-END & BACK-END JOURNEY
Once L’Oréal has identified its clientele and its habits and behaviors, the company has started doing data science. L’Oréal is studying how its prospects are evolving throughout the customer journey. It allowed the company to both upgrade its services and to develop innovative programs designed for the customer.
DIGITAL HAS CHANGED THE CONSUMER JOURNEY
The ultimate goal is to reach and connect with customers in both personalized and individual way. But it is not a linear path anymore. Passive consumers of yesterday have become the main players in today’s marketing strategies.
In order to build customers journey that leads to purchases, L’Oréal is seeking to build a 1to1 connection with customers and to know what each individual needs.
Through this adaptive approach, the brand has progressively stopped talking about “digital marketing” but more about “marketing in the digital area”. In other words, how can they play marketing in this vast digital playground?
For example, the company has recently launched a new mobile app (Modiface app) that allow users to style their hair and makeup through various filters. It is a great example of how L’Oréal is driving beauty of tomorrow.
TECHNICALLY, HOW L’ORÉAL DOES IT?
Facebook Business, Youtube data, Analytics data, etc., all those tools allow the company to both draw a precise profile of the consumers and to learn their preferences and habits.
How does L’Oréal make sure that it reaches a person at the right time?
First, L’Oréal creates the right platform. For example, it can be a customized landing page that provides the customer interests and needs.
Then it is important to create more opportunities to engage with the customer. For example, the company makes sure that they give the same customer the same experience on social media, on the website, on a mobile device and even in a physical shop; because what attracted the customer on the landing page is also what will get him/her engaged somewhere else.
L’Oréal wants to make sure that a personalized experience could be found on all its platforms in order to allow the customer to be familiar with the brand and its environment (website, app, email, etc.).
How L’Oréal reacted to all the information collected?
L’Oréal brings customers into a funnel and once they have a touch with one of its platform (app, social media, website, etc.), the company get information about the customer (under the customer authorization). The idea is to practice hyper-relevance on each step of the customer journey.
Thanks to their online platform, L’Oréal can map the customer purchases and have hyper see through. For example, the company knows that it takes 10 touch points before a prospect decides to purchase a product.
In conclusion, L’Oréal success is all about customer-centric approach. The brand concentrate on how it can improve its data in a way customers still win in all the process.
The company shifts from a short-term CPA (Cost Per Action) to a long-term CLV (Customer + Lifetime + Value). The segmentation of its audience allows the brand to give a data-driven communication in order to deploy a very accurate and personalized customer journey for each person.
Are you sitting on a goldmine without realizing it with a non-optimized website?
Are you doing the right efforts so that your website’s visitors take the actions you want them to?
I’ve had a lot of exciting discussions about those topics with Raphaël since meeting him a year ago at MTL+ECOMMERCE (to which he comes every time!). Raphaël is a CRO (conversion rate optimization) expert and runs Splitbase, a company that offers conversion optimization services for luxury ecommerce.
From his start as a magician when he was 11 years old to becoming a cryptocurrencies expert and then going into CRO, Raphaël is an overall very interesting person. He’s a really great speaker and communicator (Tedx, MTL+ECOMMERCE, Inside Bitcoins), was named one of Canada’s 10 future Dragons by Shark Tank billionaire Kevin O’Leary, and counts the famous Dan Martell as his mentor.
In his awesome interview, Raphaël shares his tips on CRO, entrepreneurship, content promotion and much more!
Vin Clancy (formerly Vincent Dignan) is one of those people who simply stand out from the pack.
But behind his outrageous clothing style, name change, rags-to-riches story and Facebook group success there is a long-term strategy made of well-thought hacks.
After Vin being a speaker at MTL+ECOMMERCE in April, I wanted him to be the first of my new Growth Hacker Interview series as he encompasses really well the growth hacking mindset as well as life hacking topics I tackle in my blog posts.
Here are answers to questions I’ve crowdsourced from Growth & Life Hackers like yourself!
1. Ambroise Debret: What would you do differently if you were starting in Growth Hacking right now?
Vin Clancy: The best platforms right now for organic content marketing are LinkedIn and Facebook groups- lots of opportunities to get tonnes of engagement. The third, if used correctly, would be cold email.
2. 2 least & most sexy moments of your career? What did you learn from them?
After you learn how to market, and how to sell, comes learning how to manage others. This is an area that I had to massive improve on in the last 12 months. Raising the second round of money for my first startup was challenging, lots of fruitless meetings.
I remember one of my advisors telling me “You looked like you were going to kill the investor in that meeting!” I was like “damn!”
Vin Clancy at MTL+ECOMMERCE on April 26th, 2017
3. What’s your secret to being all over the place at any time? Have you managed to clone yourself?
Using the distribution of social networks. I’m a fan of public speaking too- it is still under-rated in creating super-fans. But being able to sit behind your laptop and make serious waves is amazing.
4. How does Vin Clancy determine the limit between acceptable vs. too spammy/pushy?
It’s never spam if you add value. You *know* if you’re adding value or not. It all needs to be tied to a mission, then everything aligns.
5. Do all Growth Hackers become Life Hackers by extension?
Haha, good question. I’d say the good ones do, yes.
6. What is the #1 mental shift anyone has to make in order to succeed?
Understanding the sacrifice needed. It takes such sacrifice to start to “make it”
7. How to growth hack your way to getting rockstar mentors alla Vin Clancy?
Buy their courses/stuff. Most people don’t have unique skills to “give value”, and me/others don’t have brainspace to work out what you should be doing.
Do some stuff for us and charm us. Give us something we don’t have. Most entrepreneurs don’t have a social life, so giving them that can be a good way in.
8. Is changing one’s name the ultimate Personal Branding Hack?
I think dedication is the ultimate growth hack. Most people don’t have it.
10. Is the Facebook Group strategy still relevant for anyone starting right now?
11. Anything else you’d like to add to this Vinterview?
Montreal was one of my top 5 talks of the world tour (Which had about 150 talks in it in total) amazing turnout I couldn’t have predicted and great afterpartying after. Salut Canada, I hope to return one day!
Ever dreamt of going viral with an E-commerce idea?
That’s what Alexandre Vanier did with Poches & Fils (P&F). They started selling pocket T-shirts and went viral several times (going on Dragon’s Den as well as with exclusive videos), selling in the millions in the process. They’re Montreal-based but taking on the world, pocket by pocket!
I invited Alexandre to speak at MTL+ECOMMERCE #33 in November 2016, and it was a great talk. He shared actionable growth hacking tips with great humor to a crowd of 100+ E-commerce aficionados.
Alok Ahuja and Benjamin Crudo talked about their work with Shopify Plus. They were accompanied by their client and merchant Yellow Shoes.
THE LAUNCH OF SHOPIFY PLUS (BY ALOK AHUJA, SHOPIFY)
When people think about Shopify Plus, they wonder how that ecommerce platform works. Shopify is always thinking about the future, the long term. Being at its head means implies answering the questions that buyers didn’t even ask yet. It means being one step ahead of the game. It is a real challenge and you have to be very passionate about it to succeed.
Nowadays when you think about ecommerce, Shopify is one of the first things coming to mind. That’s speaks loudly of what Shopify has achieved in such a short time in the ecommerce industry.
Alok has been in the industry for over 16 years, witnessing its ups and downs. He spent a lot of time finding solutions for his retailer clients.
Back in 2008, things were really different. Alok would spend hours in the office talking to clients and trying to find out how he was going to fix the next problem. Clients would spend hundreds of dollars in license fees and administrators to maintain the hosting and the architecture of their websites. With his team, he could spend twelve to fourteen months working on a website, to the point of being sick of it.
That’s when he started to think that it was not the good or effective way to launch websites. It just didn’t make sense.
With the launch of Shopify and other platforms, the ecommerce industry is changing really fast. Nowadays, clients want to focus on the social aspect and have a fresh website as quickly as possible. The Shopify Plus team has started to show people how quick websites can go live.
Now, a website can be launched in 8 or 6 weeks. With this kind of effective team, people can focus on their social strategies and we realize the technical part of it. This is important when regarding e-commerce today.
When people think about Shopify Plus, they ask Alok what is different? There are a lot of key points that differentiate it and it is the most effective solution for an enterprise at the cost level. Shopify Plus allows you to focus on your purpose while getting a good customer experience.
With today’s mobiles applications, you are able to do so many things and so easily. That is the goal of Shopify Plus : to simplify the construction of a website and to allow the customization.
SHOPIFY EXPERTS PROGRAM (BY BENJAMIN CRUDO, DIFF AGENCY)
Benjamin started his career as a retailer in his dad’s company.
He came to appreciate how technology had a huge impact on a retailer’s ability to administrate their business in an efficient manner and achieve their goals. Through fighting with point of sale systems and Yahoo stores back in the day, he became an enthusiast with the application of technology and how to make things even better.
He left his father’s company and went to Concordia University where he got a degree in software engineering. He learnt the skills that were necessary to understand the fundamentals of the technology, its limitations and ultimately to develop his own ability to innovate.
He took a part time job as a student in a local company of electricity that needed a new website. They had a previous experience but they were disappointed. So he had to prove to them that he could deliver. At that time it was 2011 and Shopify was a much lesser known player in the market place. The platform was less evolved than it is today. Nonetheless, it was still a really good platform to work with. Its ease of customization has always been one of the pillars that makes it so good.
Shopify Experts Program
A Shopify Experts Program was then launched and Benjamin got involved in the community and started contributing to it. Today, there are thirty staff members who work for over than 250 plans. Through that Experts Program, they were able to accumulate reviews and demonstrate to customers that they could do a good work.
Any kind of ecommerce project generally follows these general steps:
Trying to understand your buyers better
Focus on the design part
Develop a launch (Shopify makes that a bit easier)
Grow the content
As a retailer you basically have three different levels to control the success of your business:
The amount of traffic that the website gets
The conversion rate
The growth margin
Traffic is a commodity. You have to give money to Google to get traffic.
The growth margin is tougher. It is constricted by your suppliers and your own ability to produce a margin rise. The conversion rate is the secret asset. That’s where you have the ability to take the platform and craft an experience that really speaks to your customers. If you can take your conversion rate to a profitable spot, you can buy traffic and increase your cost of acquisition. Therefore you’ll be able to use more revenue to bring traffic into the site. Ultimately, profit is gonna go up. It’s really important to focus on the conversion rate aspect of a website.
The design process that developers follow is also really important. You have to settle who you want to benchmark yourselves against and what it is exactly about the competitors that the customers appreciate. Trying to identify the exact features that are well known and that you have seen is a great starting point. This will help you to uncover ideas of how you’d like your design to come out in the end.
Persona development is also important to take the time to consider who the target market is, and to understand their motivations and behaviours. A website has to speak to everybody that is coming to it. Therefore, keeping in mind these personas really allows you to separate your own opinion from what works for the site.
A really good exercise is to consider all the different paths that people might take to come to the website and understand the utility of it. Very often we might wonder if they heard it on the radio, or if they googled “winter boots” and they were brought to our winter boots collection? We no longer live in a tiny place where you land on a homepage of whatever website. People are coming in and out from a multitude of websites and too many different places within the site. So we have to keep in mind that somebody might come into a random page of the website and may have missed a lot of information that you thought they received. There are many motivations and devices that could lead people to the site. You have to consider all of them in order to provide the best user experience.
The core of any well handed site is a very strong information architecture to offer a good browsability and searchability of the website. You have to think about the technical information that you present to the users, quantify it and then arrange it in a way it can be followed very easily. This is a simple concept but as the site grows, it becomes more complex.
The last stage of the user experience process is the wireframing, which is a low fidelity version of the site. After you have figured out that you wanna talk to a specific individual, that you have staged a few features of competitors, that you have thought of a couple of scenarios… That informs our ability to create a really intuitive wireframe that shows the relative importance of the information on the page. If you are rushing into the design without doing all this, then you will find yourself kind of redoing this. The best way is to start coding from day one and just make your modifications through it.
A lot of customers often have this experience where they feel that the web developer doesn’t get their objective. Very often, it is not because they are not good software developers but because the customers did not take the time to truly place all their concerns on a map to achieve the best possible experience wanted.
As you continue to put content on the website, it’s really important that you consider a few different lenses. In order to be confident of our website you have to consider all the experience that you deliver through it. The marketing motivations: do you have the right content, are you listing all the right details, are you using the right ads, … You want to keep the message consistent, and of course the development has to be done well.
The cost associated with development has tremendously declined due to Shopify and other kind of platforms.
The next question is, which technology do you use to develop your website? There are a lot of defining characteristics proper to each kind of e-commerce. There are software services where you just pay for your website’s confection like Shopify Plus. You can also download a WordPress theme and they give packages for each type of e-commerce. There are advantages to each method.
So you wanna decide which platform to use. These are all the major concerns that you have when employing your particular technology: have you got the hosting cost associated to it? Have you got the support fees that you may encounter? Is there any upgrade that needs to be performed, maintenance, insurance?
We are going to explore each of these individually.
Let’s have a look at Shopify Plus. It has an initial cost but over time you’ll see that the cost remains the same. When you sign up for Shopify there is a particular monthly fee unrelated to the traffic on your site or the amount of products. It is a very simple cost basis to understand, which means that when your business grows and traffic increases, Shopify isn’t going to ask you for any more money. It is a great benefit for a growing business.
Platforms like Magento might seem cheaper at the outset but with Shopify, over time consideration for hosting comes in. With Black Friday coming up, Shopify triples the number of servers so you could deal with a higher traffic. This way, everyone could continue to sell. Magento has a cost associated to this. You have to pay more applications fees, more store space, license fees…
These are the criterias that you have to consider when you are hosting your own solution versus signing up for a simple service model like Shopify.
Whatever platform you choose, you are going to find that the design is basically the same. But there is a new difference in the developing costs. Shopify, in contrast to other hosting platforms, is less expensive for the development part. The reason for that is because on Shopify the way that you customize the platform is by focusing your developers attention only on the esthetic component of your website. We don’t need to worry about the engine in the middle. The developer’s responsibility is just to deliver the website without writing it.
A platform like Magento gives you the full responsibility of the software : the presentation area (where you deal with the esthetical aspect of the design), the middle area (where all the logistic is set), and the persistence area (the maintenance of the website).
Shopify only forces you to focus on one of those three aspects while a system as Magento forces all of them to you. Very often, you will find that accessing to all of that is not always necessary. With Shopify, you don’t have to worry because there is a team of professionals worrying about it for you, which is a huge benefit.
RETAILER’S POINT OF VIEW OF SHOPIFY (BY THE MANAGER OF YELLOW)
The manager at the Yellow Shoes said that since recently, while they were developing an ecommerce store, they became ecommerce Team Leader. They initiated the contact with the consulting company Diff Agency. Quickly, they became knowledgeable on ecommerce. Therefore, they gave the retailer point of view about Shopify.
This year, Yellow is celebrating its hundreds anniversary. The manager’s grandfather started the business. He turned that into one of Quebec’s largest and most popular shoes business. The reason it became so popular was the self service method of selling. You had the shoes on display with all the sizes under it. Customers could come much like in a grocery store, see the shoes and then pick the size by themselves. No need for a staff employer. This was a big change in retail.
Currently, Yellow has a hundred plus stores in Quebec. They are not necessarily located in Montreal. The biggest stores are in Gatineau, Sherbrooke,… They have a limited selection of quality products at a reasonable price that we are very proud of.
Now about our first experience online: as a traditional retailer, we had no experience online. But we knew that a huge demand came through online stores. Customers and store managers were demanding it. We knew that in order to be competitive, we had no choice but launching our online store.
We used the traditional Shopify Platform. We didn’t want to invest a lot of money and we wanted to launch our website quickly. Originally we just put our shoes online. We used the first generation Shopify Platform and we presented our shoes in a form of catalog. Immediately, in the first month we saw a huge increase in our sells. It was more than we had planned. We wanted to give a more optimal experience to our clients so we decided to really invest.
One of our first strategies was to find a technical partner, someone who was a Shopify expert. It’s when I met Benjamin Crudo. He and his team helped us build a really good foundation.
What was a key to us was that we wanted to build a site that really cared about our customers. We presented our goals and our targets and they helped us with the strategy and the realization of the entire project.
One of our key things was targeting our clients. We built a client profile. We wanted to increase the conversion rate. With Shopify Plus we could start using promotions and boosting the shopping experience for our clients. Of course, we wouldn’t have to pay our transaction fees as the growth continued to go up.
We took a very mobile approach. Our goal was to limit the path to purchase, so our customers would be able to navigate through the website easily. With Shopify Plus, we were able to get a personalized site and were able to build our Yellow identity.
By using Shopify Plus, we were able to triple our conversion rate. This was a serious turning point for our business. We started this online project in May to be able to launch it in August, right on time for the “back to school” period. This was a huge sell period for us. We were able to complete all of this in three months. We are really proud of that achievement and we met our customers’ expectations.
In the future,Yellow is going to use our increased budget to invest more into the website. We want to expand our ecommerce influence. We are now able to merchandise our collections online, change words or columns on the homepage… Things we never thought we would be able to do. We can actually take control and do it ourselves. Therefore, I am very happy with our Shopify experience.
On the #33 Conference of MTL + ECOMMERCE, Maximilien Meilleur, director of the Customer Experience in SSENSE, explained his vision of nowadays customer service.
SSENSE is an international online retailer, and currently, it sells four hundred designer brands on its website and counts more than two millions page views per month. SSENSE has indeed developed an outstanding marketing process. During this conference, Maximilien gave some pieces of advice to help the startups, businesses and companies based on his experience with SSENSE.
What does “customer service” really mean?
Everybody talks about it and it’s natural because the customer is at the center of everything we do. But it came to a point where it has become meaningless. We should stop talking about customer service and start trying to figure out what is it that we really do for our customers and tell the world about it.
So, what is customer experience and how should it be approached? If we talk about customer experience we think about champaign in business class, having someone waiting for you and asking you if you need something, free beers…And it looks like the right thing to do. But it’s the first biggest mistake that we can observe. It’s quite the opposite.
There is no magic recipe. What works for one company will not necessarily work for the others. But there are still some basic points that we all have to follow.
1. Meet customer expectations
What really matters is just to meet customer expectations. If you do it all the way, they’ll stick with you. Achieve basic things like: shipping on time, fulfilling the visual basic expectations from the site…Think about what your customer expect at the minimum. The thinkline is easy, but the execution is hard.
Being consistent is the key. Everytime your customer has an interaction with you, you are training them and setting their expectation of you. Let’s use chat as an example. One day the customer comes in, asks you a question on chat and you answer in 30 seconds. If that happens more than one time, the next time the customer will come, that’s what he or she will expect. That is called the relative expectations. If one day, you are not there in 30 seconds, in a minute or more, then you will not fulfill the expectation that you build with your customer.
Expectations can be tricky so before building them, you need to know what league you are playing in. When you get “the free glass of champaign at the Dollars store” it’s weird. It doesn’t feel normal or natural. Customers comes with a personal expectation so if you don’t deliver that, it doesn’t matter how many free beers you give.
2. Be aware of the big players setting the “absolute expectations”
You can’t always control customers’ expectations. Customers of one brand still browse in other company’s store so they come in with a bunch of absolute expectations. The big players (Amazon, Facebook, Ebay…) are the ones setting up those expectations and you need to be aware of them.
Out of e-commerce, a completely different example of that is the smartphone and its app design. When you open an app and you can’t find the “delete app” button, you are displeased because you already expect it to be there .That is because it is always available in the big players sets.
Maximilien gave the example of when he discovered the “wish list” in Amazon giving the option to save items for later, he didn’t see its utility. But now if he goes online and he doesn’t have a wish list available, he’ll feel like something is missing. So the expectations are set both by the big players around (absolute expectations) and your interactions with your customer (relative expectations).
3. Avoid the frustration moments by being honest
The problem is that the expectations of each customer are different and unclear. And in a company, what we want to offer is consistency. So, how should we deal with this?
First of all, we have to make the difference between frustration and disappointment. A frustration moment is when you expected something to work as announced and it doesn’t. When the system doesn’t deliver something that was promised. It is really hard to come back after that kind of situation because the customer is frustrated from now on.
In the other hand, a disappointment moment is when the customer had higher expectations. They thought you would deliver the moon and you take them back to reality. For example, if they wished to be delivered in a day, they’ll be disappointed to learn that you can only do it in three days. So they came in with an expectation that you cannot meet but at least they can’t be mad at you because you were honest about your real capacity.
If you lose your customers over a frustration moment you will likely lose them. Very few customers will give you a second chance. After a disappointment, it is easier to win them back. So to avoid frustration, you have to tell them the moment they come in what is it that you can do or not.
4. Try to win back the displeased customers
If you still didn’t deliver your promise and a customer is really upset, it’s not the end. The interaction of the customer with you ends the moment you decide it to. So instead of ending it like that, get back to the customers, try to win them back. If you have any gifting budget or any kind of resources effort that you want to invest, focus it on the experiences that didn’t go well. Because if you offer them a compensation and keep trying to win them back, they’ll stick with you even more than before.
To support that point, Forester, the famous car company, made a study where they compared the number of customers who switched from one company to another when they were displeased versus those who stayed with them and bought even more than before after they won them back. That was a very positive experience. Numbers were three times higher when they fought to win back the customers that went away.
5. How to talk to the current customers?
The millennials are a very demanding generation. If they want something it’s here and now, right away. But on the other side, they are easy to understand. They like to find the information by themselves. You just need to build your network so the entry points will lead them to ask questions and let them come to you. Always be there to listen to them and answer to their questions as an adviser. You have to let them know that you are there and wait to jump on the occasion when they contact you.
6. Find your marketing differentiator
This whole strategy for customer service sounds really boring and in a great part, it is. But it is important to nail those goals. Make sure you invest a lot of time the firsts years to build this up. Once you nailed all of the five points above, it’s time to find your marketing differentiator. Pick the right interaction aligned with your marketing strategy, your branding, your messaging and your customers. Pick only one instead of various but less unique differentiators, and tell the world about it. For example: free shipping in the US, etc. This will make all the difference and you will reach the real quality customer service.
This is the first of a series of blog posts we will be publishing on MTL + ECOMMERCE. Paul and I (Sarah) wanted to share our experience launching an ecommerce business in Montreal. Over the coming posts we’ll talk about strategy, customer acquisition, money management, how to setup a transactional website and pretty much anything else related to ecommerce! If there is a topic you want us to blog about or have some comments to make, shoot us an email at firstname.lastname@example.org.
So, what’s all the fuss about?
You might remember us from the last MTL+ECOMMERCE meetup as community sponsors! If not, here it is. As suggested by its name, La boîte à bonbons is a candy subscription box. The process is quite simple: customers sign up, choose their favorite type of candies (sour, sweet or mixed candies) and they receive a monthly box of candies that we have carefully selected – I have to admit that sampling those candies is not the most unpleasant experience.
What’s our background?
Sarah: “After finishing my bachelor’s at John Molson, I joined HEC for the masters and that’s when I started paying attention to the Montreal startup scene. I always knew that large corporations were not meant for me, and that’s how I started working for mnubo, an IoT data analytics company. While I take care of the digital marketing strategy today, after almost 2 years there, I can say that I did a little bit of everything; a startup requires you to always be on a “learning mode”! Working with great entrepreneurs such as mnubo’s co-founders makes you a little itchy to become one as well, and that’s how we thought of La boîte à bonbons! Mostly, I will be the one leading the project, and take care of the marketing efforts and website development.”
Paul: “In 2015, I graduated from HEC Montreal, majoring in Finance. A bit by accident (and because of a passion for cuisine) I ended up at Cook it, the very first meal kit delivery service in Canada. I am now a partner there and I take care of both operations and finance. Before joining Cook it, I knew very little about ecomm or the startup community. Having the opportunity to work in an early stage startup that grew its revenues 10x over a year, gave me the opportunity to learn a lot, not only about finance or operations management but also about strategy and customer acquisition. At La boîte à bonbons, I will mainly be here to assist Sarah in managing the operations and defining our strategy.”
Why we want to blog and why should you read us?
The main reason we wanted to blog is to share our experience with the Montreal ecomm community or anyone interested in being part of it. We’ve been part of the meetups for a while, and what’s really great about this community is knowledge sharing. And so we decided that we should be doing the same, help other members of the community through our experience with La boîte à bonbons. We want to share a bit of our strategies, opinions and our (many) struggles.
Hopefully, some of you will find our posts interesting and it might perhaps bring value to your own experience. But let’s be clear, we do not pretend to know everything! Far from there. And at times, we will probably be wrong! But some of the things we are going to discuss might become of use if you are (thinking of) launching an ecomm business or are interested in the subscription business model, so keep them in mind 😉
Finally, we would like to thank all of the MTL + ECOMMERCE team for the opportunity given. We hope to match your expectations. A special thank to Ambroise, who suggested this series of blog posts.
PURE-PLAYERS VS. BRICKS & CLICKS (BY JUSTIN COHEN, KEURIG)
MTL+ECOMMERCE #32 was about how has Keurig been choreographing their direct consumer business, with their partner retailers. Keurig has made a great contribution to the coffee industry in the last five years. Technology today has the incredible capability of driving growth for ecommerce businesses.
The coffee industry has changed a lot. Keurig is mostly known for selling single-serving coffee pods. However, the brand also owns Van Houtte Coffee, Timothy’s, Green Mountain. They target the B2C market, but the B2B market still represents a great part of their incomes.
The digital director Justin Cohen focused on the DTC (Direct-to-Consumer) ecommerce, the at-home business. Keurig also sells through pure-players and distributors.
The main question is about trying to understand how Keurig works with all its partners without cannibalizing its own direct-to-consumer business, and still support their distributors they way they want to. As customers start to make more purchases online, it’s only natural their brand is going to want to deliver that online experience.
There are three trends that are driving loyalty amongst consumers:
1. Value. It’s not that people are trying to find deals, it’s more about the feeling of getting something for their money. It’s about giving something more, like a special gift or a discount. Some shoppers want to shop based on price. For example, Grolsch has created a cap using the bluetooth technology. Once customers buy a beer, they can download a movie on their computer or on their phone.
2. Transparency. Brew Dog, in the United Kingdom, released the recipes of all their beers online, challenging their followers to make their own beer. It turned into additional sales in store, because people wanted to compare. It also increased the brand awareness.
3. Unlimited. Consumers are looking for an unlimited access for a set fee, with services such as Netflix.
Based on these three points, keurig.ca is there to increase brand engagement and make their shoppers’ life easier.
Keurig works on five growth drivers. The role of DTC at Keurig are:
2. Retention & rewards
3. Control the brand experience
4. Increase brand engagement
The CEO of Netflix considers strategy as his biggest pain point. Everything he has decided not to do keep him up at night. Netflix is never going into sports, e-sports, live features. It is a tough decision to stay in your own model.
Keurig’s online growth strategy depends on on the things they will or will not do, with their bricks & clicks and their pure players partners. They need to grow their channels in the right way.
Justin Cohen then introduced the concept of the endless aisle. If consumers shop in a store, and they are out-of-stock, they can buy it online. The brand that manufactures ships the product directly.
Though, Justin Cohen does not find this notion very strategic. Every retailer is trying to say “put all of your products online”. Some products move very quickly, while the rest is put in a warehouse, and everything that wasn’t bought rationally is going to get back to you, with fees. Retailers are not being selective, nor a strategic partner. Justin Cohen doesn’t think this theory adds much value.
Amazon for example has two ways of working with brands: they buy stock, and they sell it when they are confident enough with the products or the brand; or brands set up a store and send products using the Amazon marketplace. It gives the brand the choice to put any product they want on this “endless marketplace”.
There are obvious inputs in choosing the right channels, which are volume and margin. Those are the two main characteristics to study, but the consumer is also to take into account: how does your consumer like to shop? How seamless is that retailer experience shopping for your consumer? Does this partner has a clearly defined strategy? What are they willing to share? As a brand, Keurig always focuses on being transparent: share information, help personalize their site experience… Keurig and its partners are both collaborators and competitors. They may be reluctant to give data or information, as they know the brand is going to use it in order to grow its sales.
Most of the time, partners have trouble dissociating their online business from their brick & mortar business. They think it could be a source of conflict for the retailer. Keurig.ca is not competing on price ever, as they are a high-end seller. They compete on UX, on rewards…
Depending on your challenges, there are several options to set up a growth online: have certain inputs factor in the channel strategy decision, and have human subjectivity, look at the marketing… in order to choose the right channel strategy for the brand.
In order to do this, the brand must define what they want to accomplish:
1. Design your DTC as your lead brand channel in order to control the brand message;
2. Identify your gasps;
3. Select a few great strategic partners;
4. Share data and information;
5. Review, revise and optimize every year.
HOW VIRTUAL REALITY WILL IMPACT SHOPPING HABITS? (BY DAMIEN LEFEBVRE, VALTECH)
The difference with augmented reality is that with virtual reality, everything is created, and users are able to go everywhere they want within the set limit. Unexpectedly, the VR system started in the 1950s.
Ebay started a VR project with a retailer in Australia a few months ago, to see 2D items in a 360 environment. Ebay is about to develop this service in the future. Alibaba is also working on a VR project, showing more than 5 000 items in the next few months. Though, Damien Lefebvre does not believe people will buy a 360 headset to see items in VR at home. He believes in something else, but time will tell.
In store, the game is different. The good news is generation Z and millennials love VR. They want to buy VR items, and they even expect VR systems to change their in-store experience. Valtech started working on VR in 2015, and the market is expected to see a massive growth:
VR represents a 30 billion dollars market. People would be ready to pay more for a 360 sexual experience, to see Celine Dion in concert, the real estate industry… the potential is huge.
Merrell created a VR experience in store, based on motion capture technology. People were able to hike and walk on top of mountains. The message was strong: you did it in VR, buy Merrell shoes and do it in real life.
Real estate businesses can also make their clients visit houses, furniture shops can feature three chosen couches and let consumers decide which couch fits better in their own home… the possibilities with VR technologies are endless!
1. What does your everyday life at work look like?
Startups are awesome for the particular reason that there’s not really an “everyday”. Every day tends to be different, because things come at you from every angle, you have the freedom to steer in any direction. You’re dealing with organized chaos, and for some people (like me), it’s a thrill. In my role as CTO, my expected tasks will be composed of syncing with our dev team regarding our progress, review our roadmap and its priorities, meet with my cofounders to review progress on our most important initiatives, work on PR and business development (which means meeting a lot of new and fascinating people), and of course, actual software development.
2. What are Thirdshelf’s objectives?
Thirdshelf is a marketing automation platform with A.I. at its core. We use artificial intelligence to crunch through a retailer’s POS and ecommerce data to extract patterns and insights. These insights are then fed to our marketing automation engine, to intelligently re-engage the customers and grow sales. When a retailer turns Thirdshelf on, they basically get a world-class marketing department in a box, that is able to tailor-make a loyalty program and ongoing marketing campaigns for their business.
3. What kind of data does Thirdshelf need in order to analyse data and optimize campaigns?
We connect to transactional systems such as point of sale systems and eCommerce platforms. From there, we’re able to extract transactional data down to the SKU-level. So we don’t just know that a customer made a purchase at a certain date for a certain amount, but we actually know what it is they bought. Based on this data, we can derive a lot of interesting insights.
4. Concretely, how does it process data to enhance customer retention?
We have some very interesting technology working behind the scenes to understand customer behavior and optimize retention. The most basic level is called RFM analysis. We’ll build a profile on each customer based on the recency (R) of their last purchase, the frequency (F) of their purchases and the monetary (M) amount they’ve paid to date. Where it gets more interesting is in the sku-level machine learning algorithms of the platform. These algorithms’ role is to predict what a customer will buy in the future, at what date, and why, based on a timeline of past purchases. This is a very challenging problem in machine learning that we’re tackling, and we’ve received a R&D grant from the National Research Council of Canada to develop this technology.
5. Could you tell more about the principles of machine learning?
Machine learning differs from traditional programming based on the fact that the developer is not hardcoding conditions and outcomes in the code, because he doesn’t know what they are, and there’s just too many of them. Instead, we ask the machine to look at data, and based on a mathematical model, to try and make sense of this data – finding correlations, deducing causations, posing a certain action, and then measuring the impact of that action to assess the quality of its understanding. Because it’s a closed loop, the machine is able to learn from its actions and keep improving as it collects more data points. It’s truly fascinating technology.
6. Focusing on the customers, how does Thirdshelf build a high-value relationship with them?
The big buzzword in the industry is “omnichannel retail” (offering a smooth experience regardless of the channel customers use to interact with a retailer). Our vision for retail goes beyond the nuts and bolts of channels. We call it “relational retail”. We believe high-value relationships are built when a retailer offers exceptional customer service, regardless of the number of channels. Let’s stop obsessing about multiplying the channels, and let’s make sure we focus on a customer’s individuality and personalize our offering, even if it’s only through one channel. This resonates highly with independent retailers, for who 90-95% of their business is in-store, and investing online only has a tiny impact on their bottom-line.
This relational retail is based on values of trust, relevancy and respect.
Trust: Customers tend to have a lot of trust towards independent retailers, and for that reason we’re completely white-label. We don’t come between retailers and their customers (like many of our competitors do) because we want to preserve that relationship of trust.
Relevancy: We live in an incredibly noisy world, and what separates signal from noise is relevancy. Marketing is too full of irrelevant messages, promotions of products we don’t want, or sent at the wrong moment. We focus on personalized offers for the right products, sent at the right time to the right person.
Respect: The reason of an artificially intelligent marketing platform is to avoid blasting entire customer lists with generic messages. At its core, this comes down to respecting the customer’s individual needs, respecting their time and their attention. Customers appreciate this and reward those merchants accordingly.
7. How does personalization take shape?
Personalization takes very different shapes. At the core, we personalize the content of the message and its timing. If you buy a mountain bike today, you might be interested in an offer to upgrade. But you don’t want to get it right away – you’ll want it in (say) 12 months. So both message and timing are critical. Secondly, with the multiplication of communication methods, the medium becomes very important. Some customers want to communicate via email, others via SMS, and others via a social network like Facebook Messenger. We adapt to each customer’s preference.
8. Is it simple for a small business to incorporate this strategy?
It used to be impossible – technology was simply not available to small retailers, and the big retailers spend millions with big-corp suppliers like SAP, IBM and Oracle. With a platform like Thirdshelf, a retailer can turn it on in a few minutes, and start seeing the revenue boost in a matter of days. Because we’re connected to the transactional platforms, we’re able to measure in real-time the hard dollars we bring in. Retailers get very excited to watch their Thirdshelf dashboard and see the revenue grow based on each campaign we automate!
9. Now that we understand better the process of customers’ reactivation, what about maintaining current customers loyalty?
Our platform’s first step is to segment the customer base according to their stage in the “shopper journey” – from first-time customer, to churned. Of course, our goal is to bring customers to the middle, most profitable segment of loyal repeat customers. A customer in this segment gets highly rewarded for their loyalty, and our platform works hard to keep them there.
10. What’s next for Thirdshelf?
We’re working very hard on our cutting-edge machine learning technology alongside AI researchers (there’s some great ones in Montreal!). In parallel, we’re very excited about some of the joint initiatives we’re working on with our POS and eCommerce partners to bring this technology to many more retailers. As our customer base grows, the intelligence of the collective network of Thirdshelf retailers grows with it, and we’re able to keep increasing the value we provide to our retailers. Our goal is to become the reference for customer behavior in the SMB retail industry.