SUPPLY CHAIN

Amazon fulfillment service grew more than 50% during holiday season

BY Deena M. Amato-McCoy

The Amazon Marketplace, an online mall that that allows third-party sellers to reach customers around the world, hit big milestones during the holiday season.

The amount of merchandise that the marketplace’s Fulfillment By Amazon (FBA) service shipped during the holiday season worldwide grew more than 50%. The increase was based on the “millions of items” that Prime members ordered from sellers in the Seller Fulfilled Prime program, a service that offers free two-day or next-day shipping. On Cyber Monday alone, sellers worldwide received orders for more than 28 million items, the company said.

Amazon Marketplace hit a number of milestones for 2016, including:

• FBA delivered more than 2 billion items worldwide.

• Active sellers worldwide using the FBA service grew more than 70%.

• Outside the U.S., FBA units shipped grew more than 80%.

• Using the FBA service, Amazon sellers from more than 130 different countries around the world fulfilled orders to customers in 185 countries.

• The Seller Fulfilled Prime program added more than 6 million new items that are now Prime eligible across the U.S., U.K., France, Germany and Japan.

• Sellers on Amazon that reached $100,000 in sales grew by 30%.

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MOBILITY

Regional grocer deploys mobile emergency communications system

BY Deena M. Amato-McCoy

H-E-B is taking steps to keep its employees, customers and food supply safe.

The supermarket retailer is modernizing its emergency communications with a software platform from AlertMedia that combines multichannel, two-way messaging and 24/7 monitoring services. The infrastructure consolidates communication channels – such as voice, text, e-mail, social media, and Slack – enabling users to interact with its audience from any mobile device.

H-E-B plans to use the platform to connect with employees across its 400 locations about product recalls, severe weather, system and power outages, among other critical situations.

“Keeping our partners, customers and food supply safe during emergency situations are top priorities at H-E-B, and every second counts in our business,” said Justen Noakes, director of emergency preparedness, H-E-B, which operates more than 370 stores in Texas and Mexico. “AlertMedia allows us to communicate quickly and effectively with our team, around the clock, wherever they are. We can filter information based on the locations and departments we need to communicate with regarding a particular situation. The more we use it, the more we realize all the different ways this can help our business.”

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Insights

Chief Marketing Officers: Four Steps to Succeed with Lifecycle Marketing in 2017

BY CSA STAFF

As we head into 2017, retail chief marketing officers are under the gun more than ever before to produce measurable results. Jobs are on the line, as CEOs demand evidence that increased marketing technology investments are paying off. And that spending won’t slow down soon: Gartner recently doubled down on its prediction that CMOs will outspend their CIO counterparts on technology in this coming year.

Meanwhile, today’s consumers are empowered — and unforgiving — if they feel neglected at any stage. So while marketers have gained the ability to synchronize, refine and optimize campaigns across all marketing channels, they can’t afford to lose focus on the long term relationship. More than ever, customers need to be immersed throughout their lifecycle with the business.

While many brands are using marketing technology data to foster customer-centric campaigns, some are also looking at the big picture: using lifecycle marketing to better communicate and create more revenue across customers’ entire buying lifecycle, for life. To succeed, they need to execute these four essential steps that drive lifecycle marketing in today’s consumer-driven world:

1. Engage

To help fuel a relationship that moves beyond the transaction, the responsibility rests with the brand to put the customer at the core of its communication strategy the moment they cross the threshold from being a prospect to becoming a buying customer.

Across all of retail, the majority of customers are one-time only purchasers from a particular brand. In these situations, the brand has failed to give customers a reason to reengage or stay engaged. Often, the culprit is an “unhealthy” customer list that limit brands’ insight into the different customer segments. As a result, retailers end up treating all customers the same, regardless if they have purchased one time or are a repeat customer.

Following a purchase, proper engagement is king. Data has shown that for the vast majority of multichannel retailers, repurchase falls off dramatically during the 60 days after an initial purchase. During this two-month “honeymoon” period, brands should strategically leverage customer data to determine the most relevant offers and messages – then hit the right customer at the right time to fuel transactions through optimal engagement.

2. Repeat

One tactic for maintaining a mutually beneficial relationship with the customer is through a coordinated email Welcome Series. Today, many brands use a single bland welcome email; it’s a much better idea to build a campaign that communicates meaning and relevance to customers based on their interaction with the brand.

While the mechanics of a welcome campaign may vary from brand to brand, the goal remains the same — keeping customers engaged with relevant content and offers until they are ready to purchase again.

By overlaying behavioral and purchase data collected at the point-of-sale or via online cookies, including demographic information, products searched, products clicked, etc., brands can test messaging and offers to determine how to most effectively engage with customers throughout the welcome campaign.

Targeting customers early with relevant content allows brands to invite them into a relationship that converts one-time buyers into repeat purchasers.

3. Maximize

Twenty percent of the customer base often generates about 80% of the revenue for a particular brand. Although brands want to drive value by converting one-time buyers into repeat customers, there is still significant revenue being produced by the “best customer” segment – a loyal audience that must be sustained and kept in the pipeline.

Industry research has shown that with every ensuing purchase, returning customers spend on average 67% more than new customers. Sustaining engagement through relevant offers and communication with the best customer segment throughout their lifecycle will help to drive future high-value transactions.

One tactic to enhance a customer–brand relationship is with a ‘Surprise and Delight’ program — saying “thank you!” to best customers for their loyalty while encouraging customers to move cross-category. Surprise and Delight programs work so well because they tap into basic human nature to stimulate response instead of numbing them with tired marketing messages. They heighten receptiveness to new products, upgrading services and more. Moreover, surprises can fuel word of mouth marketing and turn best customers into brand advocates.

4. Reactivate

For brands, winning a customer is only half of the battle. Once a brand has converted a prospect to a customer, the customer lifecycle is still an ongoing, cyclic process that needs to be fed opportunities to sustain a bilateral relationship.

When a customer is reactivated, their lifetime value increases — boosting the potential revenue associated with their future purchases. At the same time, the cost of acquisition decreases because it is more cost effective to market to past customers.

By sustaining customer-centric communication with lapsed customers, multichannel retailers can help reactivate lapsed customers. For example, an orchestrated outbound communication series can create an increased sense of urgency as customers approach the inactivity cliff.

Using past customer behavior data to define a relevant offer or create personalized email with tailored content can help to rebuild the lost relationship. Retailers can also model the future value of a reactivated customer so that they can have a framework for investing in win-back initiatives and the value gained once a customer is reactivated.

The Bottom Line

Gone are the days of the traditional sales funnel, where customers moved from awareness to transaction in a linear fashion. Today’s customers move in and out of the buying cycle so swiftly that for brands to properly engage, they need to place the customer at the core of their marketing and have the right lifecycle campaigns in place to reach them regardless of their stage along the buyer’s journey. For retail CMOs, this may well be a mandate to survive and thrive in 2017.


Augie MacCurrach is the CEO of Boston-based Customer Portfolios.

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