WHY E-COMMERCE MARKETING IS BROKEN

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1 WHY E-COMMERCE MARKETING IS BROKEN Martin W. Smith The traditional sales funnel is dead online

2 ECOMMERCE MARKETING IS BROKEN May seem strange to say ecommerce marketing is broken. The hockey stick growth of ecommerce in America and across the globe over the last nine years masks core challenges such as: 67.91% of ecommerce shopping carts are abandoned 1. Average ecommerce conversion rate is stuck around 3% 2. Ecommerce is not aligned to emerging social/mobile web. Ecommerce is growing at a phenomenal rate. The problem with the graph above is that it offers no context. Ecommerce compared to total retail sales is still miniscule. Currently at 6% 3 means there is a huge opportunity still ahead for those who embrace the new realities of ecommerce Cart Abandonment Rate Statistics - 2 Ecommerce conversion rates - 3 May 15, 2014 US Census Data - Why Ecommerce Marketing is Broken 1

3 Ecommerce merchants drown in tactics even as Return on investment (ROI) is suspect. According to a Content Marketing Institute & Marketing Profs survey, B2C marketers use an average of 12 content marketing tactics. Why Ecommerce Marketing is Broken 2

4 ECOMMERCE IN TACTICAL RETREAT Ecommerce merchants have been pulled pillar to post. Tactics that worked yesterday such as organic SEO, marketing and paid advertising work less well today. Those tactics are easy to copy and immediately known to competitors. As competition heats up successful tactics such as marketing are piled on, reducing efficacy. Ecommerce tactics such as marketing start as a movement with true believers and advocates. Movements evolve to businesses and businesses, especially digital businesses, discover the point of diminishing return. A BRIEF HISTORY OF ECOMMERCE TACTICS Awareness was the most important need when ecommerce was new (late 1990 s to about 2003). Having a website capable of informing AND taking money was novel. The web was nascent and finding a consuming tribe of supporters easy. Search Engine Optimization (SEO) dominated content and ecommerce marketing from 2003 to Google s organic traffic influence was so dominant during this period online merchants spent millions to study and implement SEO. The mobile and social web is slowing Google s search dominance. As social networks such as Facebook and Twitter scale their influence can t be denied. Social Media Marketing influences consumption even if how and why isn t fully understood by Why Ecommerce Marketing is Broken 3

5 many ecommerce retailers. FRIENDS OF FRIENDS MARKETING = WHAT S NEXT IN ECOMMERCE There are only two ways to win tactical warfare online: 1. Be FIRST to use a tactic. 2. Use tactics asynchronously to disrupt. First mover advantages can be significant, but so are the risks. With marketing changing so fast, it exposes a multitude of tactics with little ROI data. It becomes easy to invest in a non-starter such as Foursquare-like mobile check-ins or the wrong social network such as MySpace. Tactical ecommerce is expensive and doesn t scale. Only a handful of websites can find tactical advantages consistently. Tactical ecommerce is Greek for most merchants since they don t have the advanced skills or budget needed to play roulette with their brand. People don t buy brands they join them. Never has marketing guru Faith Popcorn s brand statement been more accurate. The social/mobile web changes everything. Why Ecommerce Marketing is Broken 4

6 Smart marketing is moving from PUSH, where buying more media increases sales, to PULL where buying more media helps when brands have a conversational engine. Conversational Engines buy media in support of social, content, cause, video and other kinds of digital marketing. More for less Paid Media Search Ads Sponsored Tweets Facebook Ads Web content Landing pages White papers Blogs Owned Media Earned Media Re-Tweets Likes and Shares Blog comments Traditional media coverage As marketing becomes a conversation customer service changes along with customer expectations. Why Ecommerce Marketing is Broken 5

7 Marketing, once a one-sided lecture, is now a conversation. CONVERSATIONS ARE DIFFERENT When we have conversations with friends and family there is an easy give and take. They know us and we love them. Conversations, thanks to social media marketing, are changing brand marketing. When every brand, company and service has high quality, a great website and cool social media we buy from who we KNOW and LOVE. The What s Next marketing question becomes how can your website become KNOWN and LOVED by new customers. Our Triangle Startup Factory funded startup helps ecommerce customers: Curate the right conversations at the right time. Collaborate to help customers realize dreams. At the beginning of our journey Phil Buckley, Curagami s Co-Founder, asked an interesting question, How could we help merchants get to know their customers as well as they know their friends and family, what would be the value of that tool? We rarely become instant friends. Conversations and trust require time. Online we look for clues. Clues tell us if people like us are using a social network. Social networks know friends and friends of friends are key to winning Metcalfe s Law (value of a network is square its members). Creating SCALE is why social networks such as LinkedIn use feedback loops like this one: By sharing my friends and friends of friends reach LinkedIn reinforces their 6 degrees of separation value proposition and WIN Why Ecommerce Marketing is Broken 6

8 Metcalfe s race in the race to be the most powerful social network for business. Leadership creates scale and scale makes it difficult for competitors. CONVERSATIONS, ECOMMERCE, BRANDS & BRANDING Curagami s founders, Marty Smith and Phil Buckley, have extensive B2C ecommerce and B2B content marketing experience. Content, as the Curagami team knows from selling over $35,000,000 online, is a tough nut to crack. Testing storytelling on the product page proved harmful to conversion. Longer content not easy to scan on their ecommerce site s product page hurt conversion. Content, such as reviews and videos, helped conversion when positioned well (usually behind tabs). Reviews in particular were vexing. Marty asked the team at the online reviews company Bazaar Voice why anyone would write the 251st review and the answer was magical. People don t write the 251st product review to add feature information. Features have been more than covered by the first reviews. People contribute the 251st review to signal their desire to JOIN the experience-club formed around that product, said Brett Hurt Bazaar Voice s Founder at the etail conference in Mr. Hurt s statement sounds like Faith Popcorn s, People don t BUY brands they JOIN them. Curagami s founders realized the importance of Hurt s statement for ecommerce marketing in a social / mobile time - merchants must create ways for customers to JOIN, ADVOCATE and SHARE. Since many tools provide ways to join, advocate and share Curagami s founders realized their tool would need a second phase - an ability to focus a tribe of supporters to collaborating with customers to help realize dreams. Why Ecommerce Marketing is Broken 7

9 CURAGAMI PHASE I - TRUST & COMMUNITY Many ecommerce websites have reviews. Reviews are invaluable User Generated Content (UGC). Reviews were so critical to Smith s and Buckley s ecommerce success in 2008 they created a Buzz Team. Teaching their Buzz Team how to use keywords, write reviews and share their reviews was prescient since the social / mobile web is one huge BUZZ factory. The 1%, 9%, 90% Problem. Visitors to any website come in three flavors : 1% - Contributors Willing To Share Valuable User Generated Content (UGC). 9% - Supporters Willing to Vote, Share and Add On To 1%er contributions. 90% - Readers are the vast silent majority helping a website s ranking by consuming its content. We realized Curagami needed to create community, a safe place where Contributors, Supporters and Readers would come to LOVE and advocate. Curagami, unlike social networks such as Facebook, needed to provide community and social network benefits ON an ecommerce website. The team thought about online community coming up with 5 tenets: Creation Story Who Are YOU (About page should map core values and tell a story referred to over and over). Share Authoritative Content Become the expert for your entire business segment. Ask For & Reward User Generated Content (UGC) Must be valued by actively curated and rewarded via gamification. Why Ecommerce Marketing is Broken 8

10 Gamification Defined system of rewards that may include jobs so community begins to scale and take over. Movements Not Campaigns Umbrella ideas that incorporate major calendar events but whose genesis you own. Ecommerce content marketing is different than B2B. As the Content Marketing Institute shared ecommerce content serves to create important Asks : Ask for a customer s RETURN VISIT. Ask for customers to JOIN. Ask customers to BUY. Ask customers to ADVOCATE & SHARE. Traditional multi-channel ecommerce marketing funnels STOP at conversion leaving no room for advocacy, shares or friends of friends marketing. In the new conversion journey purchase begins an important loyalty loop. David Edelman shared a different consumer journey 4. Edelman s new funnel aligned to the emerging social / mobile web. As social media and ubiquitous mobile connections continue to transform the web new marketing ideas become paramount: Forming community. Winning hearts and minds. Listening at least as much as talk. 4 Aligning with the Consumer Decision Journey - Why Ecommerce Marketing is Broken 9

11 Listening and being fully present on the social web may be one of the new marketing s hardest lessons. Type A builders, as most marketing pros tend to be, do many things well listening wouldn t be the first thing that jumps to mind. ORM & NEW LISTENING TOOLS Online Reputation Management (ORM) is the art and science of knowing the relevant and important conversations going on about your company, brands, services or your personal brand. Some tools such as Radian6, now part of SalesForce, read the fire hose from the social web. Drinking from a fire hose only sounds impossible. ORM tools that curate relevant conversations, Topsy is our favorite free ORM tool, are important but insufficient. Reputation needs to be managed proactively as well as reactively. Reputation and the trust it creates have never been more important or more at risk. We built Curagami as a proactive ORM tool. Curagami searches the web for relevant conversations, relevant for our customers who are currently in high end audio and fashion, place those buzzing conversations in an admin where customers curate the conversations most relevant to their offers, branding, content and positioning. This new listening helps form reputation and clout proactively. Reputation is protected because our client s websites know about and discuss relevant content. Not all content is created equal. Some content buzzes more than it converts. Curagami helps ecommerce websites find content that buzzes and converts. We help ecommerce websites convert in several ways: Better Merchandising - Merchandising with the User Generated Content supplied = relevant and socially rewarding (for those sharing content). More Return Customers - Customers visit frequently to see what crazy inventors in the basement are up too. Conversion Rates Improve - Most ecommerce websites convert better with returning customers than new so Curagami helps increase conversion rates. Why Ecommerce Marketing is Broken 10

12 SEO Improves The New Google s focus on a website s heuristic measures such as time on site, pages viewed and returning customers is perfect for a low cost content engine such as Curagami. Money To The Bank Curagami works on metrics such as site conversion, list growth and cart abandonment where even TINY improvements create a large impact on the bottom line. WORKING WITH CURAGAMI We have 2 great beta partner ecommerce customers. Our team is small and we want to help our first customers use Curagami to transform their Internet marketing. Curagami has 3 pricing options. Each option has a limited number of 2014 / 2015 partnerships until our team expands. We hope you are interested in leaving the diminishing returns and tactical warfare of the current ecommerce in favor of winning hearts, minds and loyalty with Curagami. If you are ready for a new kind of ecommerce... Contact Marty phone: (919) Why Ecommerce Marketing is Broken 11

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