Visit the CMA Website Canadian Marketing Blog

Welcome to the CMA - Canadian Marketing Association - Blog. This Blog is an initiative of the CMA Digital Marketing Council. All marketing-related topics are fair game: branding, strategy, online, offline, marketing trends, technology, direct marketing, market research...and more.


eCommerce

Tips, strategy, and insights about eCommerce.

C-Level Marketing

It used to be critical for every marketer to understand and apply the 4 P's of marketing. They are Product, Price, Place (Distribution) and Promotion. Seems a bit out of sync these days given the new world of marketing and the evolution of consumer interaction in the digital space.

I'm not suggesting we forget about the 4 P's, not at all. However, I propose we move up the alphabet and expand out. I believe we are now faced with 7 C’s of Digital Marketing. They are Content, Community, Conversation, Creative, Campaigns, Conversion and Commerce.

All play a very significant role together in today's ever changing marketing landscape. As search, social media, social networks, online video, virtual worlds, widgets, mobile and a host of other areas and elements gain in popularity, marketers must continually reformulate the way they approach and engage their audience. Today context is vital along with utility and, to a certain degree, entertainment. And, we can't forget about measurement. The need to quantify the effectiveness of our efforts is greater today (and I'd argue more attainable) than ever before.

Understanding how the 7 C's overlap, intertwine and are used in combination is just as important as the foundation set with the 4 P's. Change is good.

  • Comment on this post
  • Send 'C-Level Marketing' to a Friend
  • Permalink
Feb. 04 2008 09:00 AM | Posted by Michael Seaton | Comments 5 posted
 

Social Networks And Ad Spend - Should We Change What We Mean By Ad Spend?

eMarketer has reported $1.2 billion in projected advertising spend within social networks this year (an amazing 70% of money being spent is between MySpace and Facebook). As 37% of the US adult population and 70% of teens are frequenting social networking sites, it is a no-brainer that marketers and advertisers are keen to tap into these entities.

As more dollars shift to digital , eMarketer pegs total ad spend of $4 billion worldwide by 2011 against online social networks alone. Those are serious numbers. Naturally, the next question is "what will result from that spending in terms of effectiveness?"

emarketerd.gif

My belief is that before we label social network marketing efforts as "ad spend", we should take a step back and see what is intended for those dollars and how they will be truly allocated. We know that Users do not want to be advertised to, so it may be misleading in terms of the investments marketers will make.

As I have previously written about over at The Client Side Blog and have recently read re:Chris Brogan's and Mack Collier's opinions, I wonder if we should begin segmenting our budgets to reflect "engagement spend" or "community spend" or "conversation spend"?

Outside of the online world we isolate budgets for sponsorship, local area marketing, community events etc.., all with unique objectives, goals and outcomes. So perhaps we should spend some time reviewing what we hope to achieve in social networks and take it from there. Lumping it all under advertising just sounds too easy.

The eMarketer study shows that brands see a huge opportunity to engage Users in social networks. My hope is that we are beginning to think beyond interruption and approach interaction as a platform. Marketers will have to challenge themselves to find the right balance of novelty, utility and relevance for todays consumers. Our best hope is that a good chunk of the "ad spend" goes to something other than ads.

  • Comment on this post
  • Send 'Social Networks And Ad Spend - Should We Change What We Mean By Ad Spend?' to a Friend
  • Permalink
Dec. 14 2007 12:29 PM | Posted by Michael Seaton | Comments 1 posted
 

Move Over Millennials - it's the 50-Plus set spending more online.

Being marketers, we’re constantly training our eyes on what’s next – new technologies affecting how to reach and interact with consumers. In recent times, there’s been lots of attention focused on the 15 – 24 year olds, the gadget savvy, text messaging set we call the ‘Millennials.’ Mostly due to their sheer size – around 80 million strong in North America, we’ve been watching and analyzing their every move, figuring out new ways to engage them with a 2 inch mobile phone screen. Today though, they don’t have high earning power yet, as many are still paying off student loans and getting their careers going. In fact, Millennials in some ways are an audience that holds promise but isn’t ready for prime time.

However one group emerging as an online powerhouse – wealthy, engaged, connected and spending big in travel, finance and electronics, you have to look no further than the heads of many households in Canada, according to ComScore Media Metrix and Statistics Canada. Say hello to mom and dad - the 50+ set!

It’s easy to overlook the influence older Canadians have on our economy, given our obsession with youth culture. Canada’s digital media universe increased 1 million to 23 million users in June 2007 compared to last year, according to ComScore Media Metrix Canada, with a large portion of growth coming from Canadians aged 50 or older. In fact, the average Canuck spends close to 43 hours a month online, burning through 4,000 page views – more than any other country in the world. And older Canadians use web services such as online banking at a higher percentage rate than Americans do.

What makes the 50+ target group such an attractive demographic for an advertiser isn’t just their size, although that is part of the reason as boomers account for almost a quarter of the entire population. It’s their spending power.

According to Statistics Canada, households with at least one member age 55 or older spent 71% of their incomes on discretionary purchases – or $144 billion annually, and are expected to grow to more than $215 billion in 10 years. Granted, older Canadians account for a relatively small portion of the total online universe (around 7%), but consider these recent insights on web usage from Ipsos Reid:

71% of 50-plus Canadians with home access to the web have a high speed connection and spend an average of 8.7 hours per week online.

50-plus Canadians spend a large portion of their online time on research type activities such as trip planning (47%), product purchases (40%) and comparison shopping (37%).

29+ of Canadians aged 50+ visited a social networking site in May 2006 compared to 8% in September 2006. This is mostly due to the influence of their children, using Face Book and the like to reconnect with family and old acquaintances.

The 50-plus Canadian consumer represents a large, diverse and growing segment of the online population. They like to comparison shop, need convenience purchases, shop for quality and most importantly have the time to spend looking for what they need.

  • Comment on this post
  • Send 'Move Over Millennials - it's the 50-Plus set spending more online.' to a Friend
  • Permalink
Dec. 10 2007 09:00 AM | Posted by Robert McIntosh | Comments 0 posted
 

Is Radiohead better at marketing or making music?

According to Nielsen SoundScan, retail sales of CDs in the US have fallen by 20% in 2007. Eighty-nine million CDs were sold in the first three months of this year compared with 112 million during the same period in 2006. Even the growth of digital music downloads failed to pick up the slack, with overall album sales dropping 10%. (SoundScan counts every 10 downloads as a "digital album.")

By contrast, individual song downloads are up 20% from the same period last year, to a record 288 million. Customers are exercising control over their media experience - cherry picking songs rather than downloading entire albums and being stuck with tunes that end up dragged directly to the recycle bin.

Singing the blues.
Arguably more than any other, the Music industry has been suffering from technology’s affect on their business model. From a splintering audience, increasingly complex distribution channels, free downloads, and reinterpretations and challenges of existing copyright law, music companies are frequently cut out of the transaction when music is swapped and traded. And some would say the industry has been slow to address this rapidly changing marketplace.

When heavy metal band Metallica heard a demo of their song “I Disappear,” circulating across Napster, even before it was released, the band quickly launched a lawsuit in 2000. The band won, Napster filed for bankruptcy protection in 2002 and was later acquired by Roxio, but the existing distribution channels and copyright laws were forever changed.

That’s why I listened closely to a promotion by the band Radiohead to promote their new record, “In Rainbows.” An industry first for a band this well known, they allowed people to set their own price for downloading it – from $0 to the sky’s the limit. People could pay whatever they thought it was worth. And Radiohead would watch to see what happened.

Why Radiohead?
Radiohead seemed to be the best case to test a ‘pay-what-you-can” approach. They have a large, loyal audience composed of educated, sophisticated listeners, the sort who may actually care a bit about the issue of how artists are compensated. Plus a reader survey in the British music magazine New Music Express asked fans how much they would pay – most said an average of $10. Not scientific but anecdotally it confirmed what they were already thinking.

Results so far.
According to ComScore, of the 1.2 million visitors to Radiohead’s “In Rainbows” website between October 1-29, 62% of customers who downloaded the album did so without paying – and 17% spent $4 or less. On a happier note, many of the payers, about 12%, paid between $8 and $12 per copy. This translated to an average $2.26 per download. Not great results if revenue is the only metric.

Interestingly, other music research done in this pay-what-you-can approach suggests fans are much more likely to pay less money for music from mega rich artists like J-Lo, Gwen, and Justin. They won’t miss it, right?

Lesson Learned - again.
For me, the Radiohead “pay-what-you-want” promotion succeeded in many ways if you look beyond just the revenue it generated - modest at best.

First, the approach generated millions of dollars in media coverage, far more than the label would probably have spent on promotion.

Second, the distribution model was less costly, meaning better gross margins with more money ending up in the band's pocket.

Third, in this age of digital downloads, trying new approaches and challenging old models, the 80/20 rule of marketing still seems to apply, for around 20% of Radiohead customers generated about 80% of the revenues.

A reassuring insight the next time a music executive (or any marketer for that matter) wants to try this approach again. Now that's a note worth sharing.

  • Comment on this post
  • Send 'Is Radiohead better at marketing or making music?' to a Friend
  • Permalink
Nov. 26 2007 09:00 AM | Posted by Robert McIntosh | Comments 1 posted
 

The Ultimate Decision

The Promise:
It came upon us as a promise, wrapped in the innocence of simplicity. The inner core of a brand captured miraculously in a simple question.

How likely is it that you would recommend us to a friend or colleague.”

The Net Promoter Score was born. The brainchild of Fred Reichheld, a Bain & Co. Fellow and Dr. Laura Brooks of Satmetrix Systems. The sort of material that Harvard Business Review writes their cases about. In fact HBR did publish an article in Dec 2003 with the eye catching title “The one number you need to grow”. The equivalent of a viral campaign unfolded, supplemented with a book… global speaking engagements.

Just as a black hole, the simplicity drew everyone to it. The promise, incubated by field studies at 400 businesses (turns out to have been 50+ in the end) which held that if we managed our customers properly – our business would grow. To do so only required our focus on customers who are either our promoters (scoring you a 9 or 10), passives (scoring you a 7 or 8) or detractors (scoring you 6 or less). Wait a minute – that’s all our customers. Exactly, but we’ll get to that again at the conclusion.

The Formula: % of Promoters - % of Detractors = Net Promoter Score (NPS)

Therefore if 50% of your respondents were promoters and 20% were detractors – you netted out at a score of 30. The higher the score the better.

NPS we were told would accurately predict a company’s ability to impress customers, turn customers into advocates, and -- in turn -- become an indicator of potential business growth. Scientific proof that this simple metric was ultimately more powerful and meaningful than any other management theory about customer satisfaction, customer retention, passion, loyalty or …well anything. So simple even a CEO could follow it ;-^)

And so the market embraced the theory. From all corners of the world. Heavyweights like GE (Real Estate division) Philips, HSBC, IBM (Enterprise Content Management), LEGO, Enterprise Car Rental, Intuit, Schwabb, American Express, Microsoft and others.

A simple approach, developed by respected accreditted professionals, endorsed by a world class university adopted by companies. What’s so bad about any of this?

The Questions:
Cracks in the foundation started to develop because of the lack of support to the contentions. Namely that the NPS was not a strong predictor, that there was evidense of research bias in the support used to substantiate the NPS and that the ACSI was not uncorrelated with firm growth..

We find no support for the claim that Net Promoter is the ‘single most reliable indicator of a company’s ability to grow.’ The clear implication is that managers have adopted the Net Promoter metric for tracking growth on the basis of the belief that solid science underpins the findings and that it is superior to other metrics. However, our research suggests that such presumptions are erroneous. The consequences are the potential misallocation of resources as a function of erroneous strategies guided by Net Promoter on firm performance, company value, and shareholder wealth.”

Source: Timothy Keiningham et al. July 2007 A Longitudinal Examination of Net Promoter and Firm Revenue Growth

Other studies, other experts, opinion leaders, bloggers (see below) added their voices to the boisterous cacophony – worthy of the NYSE trading floor on a black bear day.

Undaunted, NPS supporters countered (see below) with their own assertions the NPS being as good as more complex measures and for the most part avoiding any direct discussions surrounding the statistical annomalies brought forward by Keiningham.

In this quote, Dr. Masden acknowledges being part of the team at the London School of Economics that vetted the NPS Score and asserts its ongoing validity as a reliable method of linking customer loyalty to growth.

"As far as the current debate goes, anyone who has read the information being disseminated from the “anti-Net Promoter” camp quickly comes to the realisation that the one Net Promoter question is, at the very least, just as good as more complex proprietary measures, that are tough to translate to the average executive and employee. But that leaves me questioning: why are we hung up on the measurement? The real conversation needs to be about how to get an organisation to be customer-centric and what that can mean for a company’s future”

Source: Clickadvisor.com on Sept 17 Net Promoter: the ultimate debate on customer loyalty

The Stalemate:

There is too much of an industry and ‘cult’ established around the NPS for it to dissapear on the basis of the allegations laid against them. In defence and defiance they point out that we are all ultimately pursuing the same path. True.

One can argue that the NPS may have accelerated the customer centricity movement, the other important benefit is that in its simplicity it has refocussed the dialogue on using metrics which can be widely disseminated and easily understood. Well in the words of Tim Keiningham

“ I too believe that loyalty consultants and researchers have over-complicated the message (and the analyses) with more advanced statistics than it took to get the Apollo space missions to the moon. It makes it impossible for management to understand, communicate, and rally support. This is ridiculous!”

The Ultimate Decision:
Believe it or not up to this point was the easy part. The hard part is deciding for yourself what happens next.

Will there ever be one metric to fit all needs? Highly improbable – and any contenders will not be allowed to make unsubstantiated claims. Instead of waiting for the new simple metric, we must continue to move forward with as simplified a system we can devise, implement and gain compliance with.

There are many competing schools of thought (Customer Experience Management, CRM, Loyalty/Continuity, Value Drivers, Image, WoM) reflecting the different successful business models/brands in the market.

To understand which approach will work best for your brand you must identify three things:

1. who your profitable customers are

2. what kind of relationship your profitable customers wish to have with your brand
a.Share of Wallet: the traditional CRM-centric make me a compelling (price/promotional) offer and I’ll buy it from you (or perhaps your competitors) – a brand relationship centered on the transaction.
b.Share of Mind: the traditional marketing promotions/communications approach – focussing on the key value proposition – a rational based brand relationship.
c.Share of Heart: Customer Experience Management – How people feel about the brand experience. Experience seen as a price mitigator and continuity reinforcer – an emotion based brand relationship.
d.Share of Life: How customers see the brand as a longer term partner for their category requirements, solutions and corporate/sustainability responsibility – an ‘adult/mature’ brand relationship.

3. within the relationship type identify the activities the enterprise must do to instill the longer-term repeat purchase pattern it seeks.

The key in my opinion is instead of defining your brand as an advocate of a particular ‘school of thought’ and then trying to mold your customers to fit within that model, we must instead look and manage this from the customer’s perspective. Therefore come to recognize the ALL of these relationship types exist simultaneously among different groups of your customers. What and how you communicate will be best served by understanding the type of customer they are first and from there make the ultimate decision as to how to relate and evolve with your customers.

Cheers
Miro

Suggested Reading:
NPS Adovcates:
The Ultimate Question. Driving Good Profits and True Growth. Fred Reicheld

www.satmetrix.com

www.netpromoter.com

Dr. Laura Brooks’s – VP Satmetrix latest blog posting

The Satmetrix white paper describing the research

Research conducted by the London School of Economics

Dr. Marsden from Clickadvisor.com on Sept 17 Net Promoter: the ultimate debate on customer loyalty

NPS Contrarians
Loyalty Myths: Hyped Strategies That Will Put You Out of Business and Proven Tactics That Really Work, Tim Keiningham, Terry Varga, Lerzan Aksoy, Henri Wallard

A Longitudinal Examination of Net Promoter and Firm Revenue Growth

The Value of Different Customer Satisfaction and Loyalty Metrics in Predicting Customer Retention, Recommendation, and Share-of-Wallet

January 2007 Maritz Research White Paper

COLLOQUY magazine article


  • Comment on this post
  • Send 'The Ultimate Decision' to a Friend
  • Permalink
Nov. 01 2007 09:00 AM | Posted by Miro Slodki | Comments 1 posted
 

The Age Of Recommendation

It should not be any surprise that as consumers we believe each other. We are all in the game of consumerism together and trust opinions from people we believe to be just like ourselves. When you think about it, recommendations are likely what commerce was built right from the very start, so this is really nothing new.

However, what has happened on our watch is that the digital space has given rise of the voice of the individual and the ability for everyone to provide "word-of-mouse" testimonials. We have seen a rapid acceleration in terms of the abundance and availability of this kind of material more so than at any other time in history.

As Chris Anderson cites in his book The Long Tail - The New Economics of Culture and Commerce, "the trend watchers at Frog Design, a consultancy, see this as nothing less than an epochal shift":

We are leaving the Information Age and entering the Recommendation age. Today information is ridiculously easy to get; you practically trip over it on the street. Information gathering is no longer the issue - making smart decisions based on the information is now the trick... Recommendations serve as shortcuts through the thicket of information, just as my wine shop owner shortcuts me to obscure French wines to enjoy with pasta."

It makes perfect sense. And, so does the chart below showing that when it comes to CPG consumer product reviews posted on the Internet "virtually all shoppers now find them credible". They are an extremely influential part of the purchase decision - either positively or negatively.
Consunmer%20gencontent.gif

Our opinions, tastes and degrees of satisfaction/dissatisfaction with anything and everything have now become navigation points that rise above any tag line or benefit statement we can muster up. The question marketers need to ask is how they are enabling the recommendation-factor for their brands and generating a collection of positive consumer generated content.

I believe there is no big secret on how to achieve this. It is as simple as creating something, be it a product or experience, that people will want to talk about, recommend and share with others. It all seems to fall into place from there.

  • Comment on this post
  • Send 'The Age Of Recommendation' to a Friend
  • Permalink
Oct. 18 2007 07:01 AM | Posted by Michael Seaton | Comments 3 posted
 

CMA eMarketing Professional Certificate Course Starts In One Month.

Quick reminder that the fall semester of the Canadian Marketing Association's eMarketing Professional Certificate Course is just one month away.

I have taken on the responsibility of instructing the course from Ken Schafer of Tucows and have also revamped the course materials, updating the outstanding sessions originally crafted by Ken.

The course covers web site best practices, usability, social media, email, search, eCommerce, privacy, analytics and online advertising with practical examples, case studies and stimulating discussions over a 15 week period. Students will leave with a solid foundation of today's digital landscape and a superior marketing skill set in order to go forth and make their own mark in the growing medium.

It starts up September 26, 2007 and there are only a few spaces left. For those interested in taking a deep dive into the ever evolving world of digital marketing, don't delay.

Kick start your future with the CMA's eMarketing course. For more information, or to register for the course, please visit the CMA website. I hope to see you there.

UPDATE: I forgot to mention the course is available in Toronto and Montreal. Mitch Joel, and Dave Haber of Twist Image will be the course instructors in Montreal.

  • Comment on this post
  • Send 'CMA eMarketing Professional Certificate Course Starts In One Month.' to a Friend
  • Permalink
Aug. 25 2007 11:17 AM | Posted by Michael Seaton | Comments 1 posted
 

Are you going to Search Engine Strategies 2007?

If you are, you’ll be surrounded by new search technologies, hear ways to make your online marketing dollars work harder, meet smart techies – even find out how to build your ‘purple cow quotient.’

It’s a global conference that stops in Toronto June 12th and 13th at the Metro Toronto Convention Centre. This year sounds like a smart time investment judging by the conference lineup and list of exhibitors. In years past, SES attracted between 1,500 and 2,000 marketing types and business owners interested in brushing up their online marketing skills, networking with product managers and listening to technology innovations by industry leaders.

The conference itself is divided into three information tracks. The first – ‘Get me up to speed’ is an introduction to search marketing, optimization, key players in Canada, and how to identify online scams and performance myths. The second, ‘Let’s make some money’ covers monetization – there’s a website clinic, speakers who cover how to make cost effective online development decisions, and what skills we need in our online marketing tool kit. The third, ‘On the cutting edge’, discusses trends, innovations and new approaches in local search, paid listings and marketing to women online.

Of note is Track C (On the Cutting Edge) on Day 1 - Local Search: A Growth Industry. Leaders in the local search space including YellowPages.ca, Google and ZipLocal offer their update on the state of the art, explore chicken-egg frustrations, and attempt to glimpse into the future direction of local search. The moderator is Anne Kennedy, Managing Partner from Beyond Ink with speakers from Yahoo! Canada, ZipLocal and Darby Sieben, Senior Manager of traffic and distribution from YellowPages.ca. On Day 2, Microsoft showcases their much talked about new online advertising solution. The keynote address on Wednesday is entrepreneur and change agent Seth Godin, author of The Dip.

Make sure you spend time on the show floor too. Arguably this is where your investment really pays off. You’ll be able to meet with developers and product teams who work on search and optimization products everyday. These folks have an intimate knowledge of how the tools function and can showcase competitive differences between providers. Plus they offer unique and well thought perspectives on the online search industry as a whole. It’s a rare opportunity to get up close to the technology and the people who build it, have a personal demonstration and ask lots of questions relating to your specific business situation.

The Search Engine Strategies 2007 Conference & Expo is at the Metro Toronto Convention Centre (Front Street) June 12th and 13th. To register, visit http://www.searchenginestrategies.com/sew/toronto07

  • Comment on this post
  • Send 'Are you going to Search Engine Strategies 2007?' to a Friend
  • Permalink
Jun. 11 2007 09:00 AM | Posted by Robert McIntosh | Comments 0 posted
 

How to Impress the On-Demand Consumer

One of the attributes of what we at work call the new "On-Demand Consumer" is that when 'Joe On-Demand' is in-market, he looks for fellow consumer reviews and ratings of the product or service he is interested in. Sure, he cares what official experts have to say on the matter, but the opinions of his friends and peers and the guy next door are what will really influence his purchase decision.

So, if Joe is trying to decide between a Sony plasma TV and a Panasonic plasma TV, he will browse the consumer reviews at epinions.com. If Joe is hunting for a decent hotel, he'll visit TripAdvisor to read what people who have stayed at the hotel thought of their experience.

I recently stumbled across a great example of a company that is managing this new "consumer-as-reviewer" reality. While browsing TripAdvisor looking for consumer reviews of a handful of hotels in Montreal, I discovered one hotel that clearly recognizes the importance of the On-Demand Consumer.

Like many of the hotels I had short-listed, the TripAdvisor listing for Hotel Omni Mont-Royal had over a 100 TripAdvisor Traveler Reviews. Most of the reviews were favourable, but there were a smattering of negative reviews as well. Pretty much what you'd expect to see for all the hotels. You can't please everyone!

Except for one thing.

Every single Traveler Review - positive or negative - that had been posted this year was followed by a detailed written response by a management representative from the Hotel Omni Mont-Royal. That's right, someone representing the hotel had taken the time to read and respond to each of the reviews.

This was the first time I'd seen a hotel respond to consumer reviews on TripAdvisor, and it really impressed my wife and me. Rather than bury their head in the virtual sand and ignore what was being said about them, this hotel took a pro-active stance by participating in the online dialogue and - at the same time - demonstrating their strong commitment to customer service. I'm sure we weren't the only potential customers who were positively influenced by this smart move.

While we didn't end up staying at this hotel - we had a change of plans - its active participation in the TripAdvisor Traveler Review section certainly made a strong and favourable impression on us.

  • Comment on this post
  • Send 'How to Impress the On-Demand Consumer' to a Friend
  • Permalink
Apr. 18 2007 09:00 AM | Posted by Bill Sweetman | Comments 2 posted
 

What is your view on Email Marketing ?

What is your view on the state of e-mail marketing, is dying or thriving?

Will email survive as instant messaging and RSS start to take hold? Will new techonologies hold the same promise and return on investment seen with email? What will the future look like when the generation that grew up on the net hits the workforce and becomes the driving force in the economy?

I wrote a post over at One Degree and received some comments there. Now I want to hear from you over here in support the upcoming CMA “Optimizing E-mail for Better Results“ breakfast roundtable.

What questions would you like the “Optimizing E-mail for Better Results“ rountable to address at the upcoming CMA – Canadian Marketing Association breakfast event on March 7 which I will help moderate.

Here is your call-to-action:

Respond in one of two ways and join the conversation:
1. Leave a comment here or at One Degree
2. Call my comment line at The Client Side podcast and leave an audio comment 1 206 666 2242 which I will include as part of the roster of questions for the panel and will include on the next episode of my podcast.

(Of course, you can always show up and ask a question from the audience at the event - we'd love that too!)

Looking forward to hearing from you.

  • Comment on this post
  • Send 'What is your view on Email Marketing ?' to a Friend
  • Permalink
Feb. 27 2007 09:46 PM | Posted by Michael Seaton | Comments 2 posted
 

Other than that, how was the show Mrs. Lincoln?

On the scale of “this is bad”, the news about the security breach at U.S. based retailer TJX (Winners and HomeSense in Canada) is, well, bad. Consumers are already pretty weary about their credit card security, and this certainly won’t help. If there is a bright spot in all of this it’s that the security breach is not related to online retail/eCommerce – TJX closed their eCommerce operations in the U.S. in 2005, and (other than gift cards via a 3rd party provider) have never ventured into the space in Canada.

Let’s hope/help the message stays precise – this is not an eCommerce/online shopping issue.

  • Comment on this post
  • Send 'Other than that, how was the show Mrs. Lincoln?' to a Friend
  • Permalink
Jan. 18 2007 11:54 AM | Posted by CMA
on behalf of
Michael LeBlanc
| Comments 0 posted
 

When Not If... 2006 Holiday eCommerce Perspective

Spurred by Jeffrey Grau’s recent eMarketer report on the state of eCommerce in Canada, I thought I would add my own perspective around the Holiday online shopping season. Grau’s report picks up on a theme that I have been promulgating for several years – that the dialogue in Canada should be about when eCommerce hits the tipping point in Canada, not if.

What does a tipping point look like? Look to the South my friends, where ComScore Networks is first out of the gate with a forecasted 26% year-over-year growth this holiday season for online B2C eCommerce retail (not including the huge online travel segment). These growth numbers are now almost routine for U.S.retailers (though I’m sure they don’t feel routine – amazon.com had 4 million orders on December 11th alone – it’s biggest day ever), even within a Holiday retail season that was by most reports coming in on the low end of the single digit forecasts.

Growth in Canadian eCommerce is solid, with eMarketer reporting that Canadians are ‘poised” to double their online spending for retail goods from $8 billion in 2006 to $16 billion by 2009. The key difference here is that these numbers include online travel, event ticket and digital downloads – each of which is a huge component of that eight billion dollar number.

Why do online sales of physical, DSTM (Department Store Type Merchandise) merchandise in Canada trail the U.S. retail market? It’s a simple question with a complicated answer. While there are indeed several great online retailers serving the Canadian marketplace (The Shopping Channel, canadiantire.ca, sears.ca, futureshop.ca/bestbuy.ca to risk naming but a few) there remains essentially both a supply side and demand side deficit. In other words, more retailers would go to the expense and effort of selling online in Canada if more consumers were shopping online, and more consumers would shop online if only there were more retailers selling online.

One of the catalysts that will drive greater adoption of B2C eCommerce in Canada is a greater influx of U.S. merchants serving the Canadian marketplace. Not necessarily because they are better online merchants, but because their big brand names drive awareness, and they help “make the market” in terms of breadth and depth of assortment available online.

Don’t look for that to happen in 2007 however – with the growth rates that we’re witnessing in the U.S. right now it’s difficult to see the big online retail brands looking North for growth any time soon – their focus will continue to be keeping up with double-digit growth rates in their core online domestic business and serve their customers well.

So where does that leave us? Watch this blog space for more!

  • Comment on this post
  • Send 'When Not If... 2006 Holiday eCommerce Perspective' to a Friend
  • Permalink
Jan. 09 2007 08:45 AM | Posted by CMA
on behalf of
Michael LeBlanc
| Comments 1 posted
 

Are you passionate about a marketing topic? Would you like to write a post about it for the Canadian Marketing Blog?
  • Submit a new post


Subscribe to our feed

May
1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31




Blog Roll