Fashion Marketing: The New Paradigm

This summer, I spoke at many conferences (Annual Marketing Conference in Lima - Peru/ Fashion Seminars at the University of Trinidad and Tobago/ Luxury Marketing seminars at ISCOM in Paris) and the demand was always the same: "Tell us how Fashion Marketing is changing and what should be done to succeed". There is clearly an acknowledgment that the market, business and marketing environments of Fashion have dramatically changed and those changes require a new approach to succeed in fashion.

The changes happened in several ways:

* The market is now global...which means more opportunities but also more competitors

* The fashion/ luxury market segments have evolved from on segment (absolute luxury) to multiple segments (absolute luxury but also aspirational luxury and affordable luxury)

* The fashion/ luxury consumers are not more "one size fits all"...they are multiple segments dramatically different one to another...and there demanding totally different treatments

* And to make things more complicated, Digital Marketing is profoundly transforming the marketing  mix and particularly the promotional mix across the world.

With all those changes, fashion designers and businesses have to have marketing discipline. If not, they are going to dilute very quickly their limited resources on inappropriate or undistinguishable strategies and activities.

Having marketing discipline means for a particular fashion product idea:

* Have the right marketing objectives

* Focusing on the right target for such objectives

* Developing the right value proposition and positioning strategies for such target

* Developing the right marketing mix components to deliver such value with such positioning to the selected target

..And they have to do so while maintaining the creativity that makes fashion unique.

This is an amazing moment for fashion and luxury...very scary for some...quite motivating for others.

In all cases, the winners will be the ones who will be able to properly balance creative designs with marketing discipline.

Here is an extract of my presentation.

Good reading

Social Media Marketing finally maturing?

Recently I read a WSJ article on Facebook which relates to their new interaction with the Advertising professionals in order to conceive and develop promotional activities, that are not only trackable and measurable but ROI analysis-ready.

Does it indicate that Facebook is maturing as a media?

Interesting though that according to this article, when the new initiative of Facebook to create a "Client Council," calling together senior advertising executives from 13 big brands and ad agencies, to find advertising approaches that will help measure the return on investment (as opposed to just rely on a leap of faith in the power of social),  Mr. Zuckerberg's response to a question from one of the attendees on how they will be able to measure the return on their investment in this initiative, was: "That's a great question and we should probably have an answer to that, shouldn't we?"...Well, that is a question that should have been asked a long time ago already but later is always better than never.

Do they really have the choice?

Not so much...They have to. Otherwise, Facebook will be a souvenir down the road...not a business model to look at for reference.

So are they maturing or not?

It always go back to the same concept where the key principles of effective marketing and advertising are applied:

A) It is always about The Right Product to the Right Target with the Right Message at the Right Time through the Right Channel

B) It has to be measurable like any investments

Where Facebook has to be careful is that not all marketing communications do or can have sale objectives attached to them and therefore are more ready for ROI analysis...Sometimes a message has the singular objective to make the audience aware or knowledgeable about a product or an offer...and then other communications after that will bring the target to the purchase stage. The 1st message can not have a direct revenue or sales objective attached to it.

Also, what could be the reaction of the consumers and the Facebook users if Facebook push "harder" on the advertising options that they propose to their clients and such users feel intrusion.

In fact, Facebook as a social tool does not need to do push harder...Now Facebook as a business has to. So the question is not if. The question is how.

If they can not make it work, unless they are able to be funded through donations, they will go away.

So are they maturing? Yes they are and like all of us, they have no choices...They might have to end up relatively smaller and profitable. The jury is out but they make the right moves!

Google Analytics...Let's demistify!

So I am pursuing a Web-Digital Analytics certification program to complement and update my expertise in this domain and the more I go through the training (which is well done), I realize again that we just love to complicate things...to have the feeling that "we" know...and that "they" don't.

As one goes through a certification program on Digital Analytics with a strong focus on Google Analytics, it is highly probable that this person will be exposed to known terms...Metrics, segments, kpi, etc. and new ones like dimensions, traffic sources, goals, path, medium, outcomes, outcomes as goals, goals for KPIs, etc.

At first it is obvious one will be confused by so many terms and so many combinations of those terms...very confused. This is always the case when technology is put before business or marketing logic and a (brilliant) team of technologists use what they know, to give a business or marketing feel to what they propose.

Well, let me demistify Digital Analytics one step at a time:

Digital Marketing analytics (linked to tracking and analyizing SEM, SEO, emails, etc) is no more and no less than Database Marketing applied to online data...as simple as that! No 4th dimension world with new logics and new alien concepts.

• What is Database Marketing...This is what I came up with: The application of database and data analysis to marketing decisions!
• What are the marketing decisions that we are talking about? let me summarize the ultimate decisions that you want to make
  
  • What is the "best" target?
  • What are the "best" offering and offer?
  • What is the "best" time to contact?
  • What is the "best" channel?
• What is the point of improving marketing decisions? A higher return for your marketing investment!

When you look at Digital Marketing, this is the same purpose but online so the specific dimensions for you to try to find the "best" are not exactely the same than for the offline world but pretty close. They are not the same in the sense that they are linked to online but at the core, they relate to the same core focus: Observing and tracking consumer behaviors and understanding who they are so that a marketer can concentrate on the consumers or prospects who have the most or the most propensity to have the targeted behavior.

What are those online dimensions in line with the key marketing decisions?

• What is the "best" target?...Translate in Digital Marketing terms applied to digital data
  
  • What is the "best" traffic source?
  • What is the "best" visitor location?
  • What is the "best" keyword?
  • What is the "best" mobile device?
  • Etc.
• What are the "best" offering and offer?...Translate in Digital Marketing terms applied to digital data
  • What is the "best" AdWord Ad?
  • What is the "best" AdWord campaign?
  • What is the "best" message?
  • Etc.
• What is the "best" time?...Translate in Digital Marketing terms applied to digital data
  • What is the best traffic day?
  • What is the best traffic hour?
  • Etc.
• What is the "best" channel?...Translate in Digital Marketing terms applied to digital data
  • What is the "best" traffic source?
  • What is the "best" visit path?
  • What is the "best" landing page?
  • Etc.

Point made!

Digital Marketing is no more/no less than marketing commmunications...online/on digital devises:). So of course, it has its own content creation rules, technology requirements, interaction rules, etc....but in the end, this is still about a target going from point A ("I do not know you") to point Z ("I purchase your product") where the "online" path from A to Z, while not being linear, is still in the end in having as many people in the target going from A to Z.

So this means that Digital Marketing and therefore Digital Analytics are here to help build effective marketing communications to push or pull as many people in the target to the purchase stage.

It seems to me that once we simplify our understanding and once we go back to basics, things get clearer and manageable.

Thinking Fast & Slow...and Marketing!

I am reading right now the book Thinking Fast & Slow by Daniel Kahneman and this makes me wonder the implications of his findings and conclusions for marketing.

Basically, his baseline approach is to state that our thinking process is in fact composed of 2 systems which he calls System 1 & System 2.

System 1 is "fact, intuitive & emotional". System 2 is "slower, more deliberative and more logical".

Both systems have extraordinary capabilities and as extraordinarily, some important limitations.

For example, system 1 will be the one linked to intuitive persuasion..which sometimes leads us to the right conclusions...and sometimes not. The core idea is to detect those limitations and use (trust) system 2 to correct those "wrong" impressions.

Now system 2 is incapable of quick reactions, while sometimes they are needed or it can lead to "wrong" conclusions if no use "properly".

To help the reader understand the difference between the 2 systems, the author uses several examples...One of them is the Muller Lyer example.

Look at the image below!

What do you see?

The upper horizontal line is shorter than the lower horizontal line? Right?...This is what your system 1 tells you.

Now you know maybe that in fact they have the same length or your "deliberate-slower" observation will bring you to that conclusion...That is your system 2 speaking here.

So easy!...we just need to follow system 2 constantly but this is not that easy as sometimes, we just can not control system 1 or in other times, system 2 is so "demotivated" that it is bringing you to the wrong conclusions.

The key is to know which system to rely on...when and to recognize when the limits of each system are reached.

This is a very interesting book that I recommend to all marketers as in fact, what we do (or are trying to do) as marketers, is to influence the decisions-making process of our targets...Therefore, to understand how decisions are made within the context of the 2 systems and how those 2 systems shape our judgments and decisions are critical.

When to solicit system 1?

When to solicit system 2?

When to combine the 2?

Once we know which system we have to solicit, to obtain the expected reaction from our target , how to build the marketing communication in such a way that this is the system that our communication will aim at and as it does that, it does it effectively?

In advertising creative tactics, we are talking about emotional and rational appeals which more often than not are combined in marketing communications but they remain 2 separated dimensions...What about is we were to use system 1 & system 2 where of course the 2 systems could be combined if need but furthermore, one will influence the other like the Yin and the Yang of a message...Pretty powerful!

Oh well...just some food for thoughts.

Why expecting a better outcome when doing the same things?

Why would small and medium-size businesses expect a different outcome if they always do the same thing? Meaning nothing or the wrong thing for their leads management!

The Top challenges for small and medium-size B2B businesses are very well known: Erratic cash flow, difficulties in acquiring new leads and signing new clients...while their clients are consolidating their support into a smaller number of providers and reducing their budget at the same time.

As an example, in the "2012 State of the Online Marketing Services Industry" by HubSpot, the top challenge for marketing agencies is to better manage their cash flow, by having a more constant and controllable flow of business.

Before being able to control the business flow, one needs to have a flow…To gain this flow, businesses need first to generate leads.

Now, according to the same survey from HubSpot, the second most important challenge for marketing agencies is..."Not enough leads"!

So you are a small or medium-size business and you know that generating leads is the right answer to your biggest cash flow challenge…but your 2nd biggest challenge is generating leads!

And as if it were not enough, generating leads is the easiest part.

According to the National Sales Association, where sales occur in the sales cycle, it is as follows:

2% of sales are made on the 1st contact

3% of sales are made on the 2nd contact

5% of sales are made on the 3rd contact

10% of sales are made on the 4th contact

80% of sales are made on the 5th-12th contact

How many times did you ever reach the 3rd contact stage or the 5th contact stage for your leads or even worst the 1st contact stage? Do you have the time? Do you have the infrastructure? Do you have the talent?

So let me reset it…As a small or medium-size business, your core issue is generating and managing cash flow…To do so, you need sales leads but generating leads is your core sales challenge and even if you had leads, they might not pay off without following through.

As for many (if not all) insurmountable challenges, one needs to get back to basics.

To generate sales from leads, businesses need to generate the leads but even more importantly manage those leads.

Better business results imply a performing and systematic leads management process in place, that you can turn off and on as needed, to manage your projects flow...A big client left or is not yet there?...Open the leads generation and management faucet...Too many projects?...Reduce its flow.

What does an efficient leads management look like?

• A set of appropriate leads sources and a formal qualification process 
• A systematic and targeted follow ups mechanism
• A clear set of milestones for leads management activities between the different parties involved
• A dedicated attention and systematic results tracking
• A unique combination of adaptability and automation

Too complicated…I have a solution for you…Keep It Simple and Stupid first and…Just outsource!

You know you need to generate leads…You know you need to manage those leads effectively to extract the proper value from those…You know you do not have the time and expertise to develop and manage the process…So outsource!

This is the conclusion that many small and medium-size businesses that I worked with for managing their Leads Management process, came to. Yes it costs but in the end, the return is there.

Depending upon the surveys and the analysis, Leads Management Processes are credited with increasing leads conversion by up to 150% and the value per acquired customer by up to 70% (*).

So it is time to get serious with leads management!