November 18th, 2013 by Sarah Sluis
From Black Friday to Cyber Monday, consumers are only expected to spend 2.2 percent more than last year on gifts, according to a retail forecast from IBISWorld. Consumers are more focused on spending money on entertaining than on gifts, according to the market research firm. Money spent on food, drink and turkeys will go up 3.7 percent,
Black Friday shoppers
outpacing gift spending.
The recession has had a big impact on spending in the past five years. According to IBISWorld’s historical data from the past five years, 2009 and 2011 were particularly bad, with completely flat spending. Last year was the best in the past five years, with a nearly 6 percent increase in spending on Black Friday and an almost 10 percent uptick in the weekend as a whole. This year, the growth will taper off a bit. Spending on Black Friday is projected to go up 3.9 percent to $13.6 billion, but for the weekend as a whole, IBISWorld came up with a lower figure, $38.6 billion, which is up just 1.7 percent from the previous year.
Cyber Monday rightly deserves a category of its own. Even in the recession, online spending continued to grow. Sure, some online spending is additive, but most of the growth online comes from consumers shifting their behavior and moving their purchases online. This year, spending during Cyber Monday is projected to increase 13 percent, slightly less than the near 20 percent growth in the past two years. Cyber Monday is still less than a fifth the size of Black Friday, but many consumers prefer slower page load times to being crushed in a stampede of crazed shoppers.
IBISWorld’s study doesn’t comment on upticks on Thanksgiving Day shopping. Many retailers now open the evening of Thanksgiving, encouraging shoppers to stuff their carts shortly after gorging on turkey. Others, like Costco and Nordstrom, have resolved not to start the holiday shopping early. Wal-Mart is among the retailers opening on Thanksgiving, but it’s also trying to stretch the holiday season even earlier. In early November, it had Black Friday-level deals on seven electronics items, including a big-screen television, along with hundreds of deals in home décor. The National Retail Federation projects that sales will be up 3.9 percent in November and December, a higher figure than IBIS is predicting for the shorter Black Friday to Cyber Monday. That discrepancy could be related to retailers who are spacing out their offers.
Last year, the average consumer spent $423 during the post-turkey rush, according to the NRF. According to the circulars already posted on many websites, that’s one television, four DVDs, a board game, a SodaStream, winter outfits for the whole family, and a Razor scooter. Not a bad way to start off one’s holiday shopping.
November 18th, 2013 by Forrester Research
The following post was written by Anjali Yakkundi, an analyst at Forrester Research serving application development and delivery professionals.
Many have interpreted the customer experience imperative to mean that IT is dead and that marketers are the future. But this is far from the truth. After all, what’s the point of great design and marketing strategy if you can’t deliver the right experience to the right customer based on such important factors as location, device, and place in the customer journey? In new research, my colleagues and I maintain that now more than ever, IT professionals are vital to delivering exceptional customer experiences that differentiate brands from the competition.
But realizing this potential requires organizational transformation, as many application development and delivery teams conduct their daily business in the obscurity of the back office. Instead, they need to sit at the forefront of business strategies around customer engagement by, among other things, empowering business and marketing professionals with the right applications and mastering analytics for better insights and experiences. Most firms I speak with aren’t organized to support this imperative. In fact, I’ve only found one constant in our research into digital customer experience delivery within organizations: uncertainty.
Some organizations have their digital group within IT, while others have it under marketing. Others are paving new paths and have a single group that combines customer experience, marketing, and business folks with technologists. On the other hand, CIOs and leaders of customer strategy, marketing planning and execution, and application development—several of the parties typically involved in developing digital experiences —all recognize that Web-era organizations, talents, and project norms are failing in this new age. Yet the best alternative organizational designs aren’t obvious. In new research, we’ve found four models that firms can utilize to build their dream teams:
1. Full service. This is a variation on the centralized IT organization, with this team delivering digital experiences alongside other projects, and works best for companies with modest demands for digital customer experience projects and new technologies. In one example we found, a team uses agile methods and incorporates marketing stakeholders into project teams. The chief advantage of this model? Consistency. Marketing pros can count on application development teams that know their needs, rather than having to train IT generalists.
2. Marketing technology. In this model, marketing technology groups (which have typically covered more campaign-specific technologies, such as campaign management and email marketing) charge developers with controlling all aspects of digital experience delivery: development, budgets, personnel, platforms, and partner/supplier relationships. The model shifts development from corporate teams with the benefit of high responsiveness and innovation. But companies must be careful to avoid critical pitfalls, such as lack of focus and rapid project delivery that is difficult to evolve.
3. Split brain. Today, e-business groups often receive mandates to manage mobile and cross-channel digital experience projects across teams. The result is two divergent application development organizations: one outward-facing and closely aligned with customer experience leaders, and the other taking care of internal applications and business groups. A key benefit is business responsiveness, with no need to balance back-office and outward-facing requirements. However, teams must be careful not to sacrifice sustainability in the quest for ever-faster project delivery.
4. Digital experience ecosystem. Forrester has yet to find a good example of digital experience ecosystem—an ideal that is very hard to achieve. In this model, each digital experience player controls the tools and activities required for their work, but relies on other players for essential services. This model is high-reward, high-risk. The potential advantage is the balancing of business agility by empowering business leaders while promoting cost efficiencies of shared-service technology management.
Which model is best? The answer depends on how each model’s advantages and disadvantages stack up to a firm’s goals, history, and digital experience requirements. Every organization will progress toward the digital experience ecosystem, but few start there. In fact, this transition will take years—so application development leaders must start on it now.
November 15th, 2013 by Leonard Klie
A new survey from Dimension Data found that contact centers will require new technology and resources to keep employees happy and consumers engaged.
The research found that as contact centers make the transition from banks of phones with agents sitting patiently by to answer calls as they come in to highly responsive, cross-channel multimedia hubs, agents are growing increasingly dissatisfied, largely because they might not have been hired or trained to communicate within these new channels. Almost one third (31.8 percent) of contact center advisers are now handling transactions across a variety of emerging channels,
As a result, contact center agent absenteeism is three times higher than contact center management, and agent attrition is up 26 percent higher than last year, according to Dimension Data’s stats.
The 2013/2014 Contact Center Benchmarking Report notes that organizations must revamp their operating models, starting with properly trained agents, or risk losing them.
“The pace of technology adoption by end users is driving contact centers to evolve and gather speed, which means the complexity of transactions has increased. Organizations haven’t kept pace with technology and are operating outdated systems,” Andrew McNair, Dimension Data’s head of global benchmarking, explained in the report. “There’s no doubt that if management does not plan for increased contact center agent competency and develop skills across multiple channels and disciplines these organizations will fail.”
Problem is that it’s not just the agents who are growing dissatisfied. Customers are also increasingly dissatisfied with their contact center experiences. Customer satisfaction is down for the fourth year running, and the typical customer has only a 75 percent chance of having his issue resolved when contacting customer service, according to the research..
Dissatisfaction is especially high among Generation X and Y, who demand a choice of interaction points beyond phone calls, including Web chat, smartphone applications, and social media.
The report shows that for Generation Y the phone is now the third choice of engagement after electronic messaging and smartphone applications. In addition, the preference gaps for Generation X between phone, text messaging, and social media is also narrowing.
McNair believes that Web chat communications systems might be the remedy for increasing end-user dissatisfaction, as customers increasingly expect seamless interaction transitions from one channel to the next.
But there too, lies a problem: The report shows that as organizations look to shift 32.6 percent of contacts typically handled by agents to self-service channels, they have rushed to implement solutions that only address one channel. As a result, self-help options in the contact center are not catching on as expected, and isolated technology systems are hindering the multichannel consumer experience.
To extract this information, presented in its 2013/2014 Global Contact Center Benchmarking Report, Dimension Data surveyed 817 participants covering 11 business sectors in 79 countries. Sadly, it all points to rough times ahead. Hopefully the contact center industry can rise to the challenge.
November 14th, 2013 by Maria Minsker
Multimedia content is growing across the Web. YouTube continues to play a major player in the video sphere, but other image and video oriented social sites such as Instagram, Pinterest, Vine, are garnering some serious attention at well.
Though these visual-heavy social networks are not for every brand, those that can indeed benefit from engagement on those sites should make every effort to use them to their full potential.
Curalate, a visual analytics and marketing platform, released research earlier this week, revealing that there are certain properties that drive likes and sharing on Instagram much more so than others. In their research, Curalate used custom algorithms to examine how more than 30 image features including background ratio, dominant color, lightness and saturation combine to create high performing Instagram images. After analyzing more than eight million Instagram images, findings showed the best performing images feature a large amount of background space, blue as the dominant color and high levels of texture.
“Likes on Instagram, while incredibly valuable, are hard to come by with 65 percent of Instagram images garnering between 0 and 10 likes,” Apu Gupta, CEO of Curalate, says. “By making a few small tweaks, brands looking to connect with consumers on visual sites like Instagram can see their engagement skyrocket, resulting in increased customer loyalty and more importantly, sales.”
Key findings are below.
1. Blues and Single Hues Work Best on Instagram
Blues perform best on Instagram, while images with high concentrations of reds and oranges perform poorly. Images with blue as the dominant color generate 24 percent more likes than images that are predominantly red.
The more a single hue dominates an image, the more likes it receives. Images with single hue dominance above 40 percent receive the most likes. Currently, most images on Instagram don’t have single hue dominance–in fact, 90 percent of images analyzed only have between 0-20 percent single hue dominance.
2. Less Saturation is Key on Instagram
Images with 0-15 percent saturation (or little color) generate 18 percent more likes than images with more vibrant color (20-40 percent saturation).
3. Light and Complex Images Win on Instagram
To generate consumer interest, images should allow the eye to rest by having some background space. Images with a large amount of background space (above 90 percent) are very successful. Despite this, 70 percent of current Instagram images only have 0-20 percent background space, leaving significant room for improvement.
4. Dark Images Minimize Sharing and Likes on Instagram
Images with 65-80 percent lightness generate 24 percent more likes than dark images with 0-45 percent lightness.
5. Texture Plays a Role on Instagram
Images with high levels of texture generate 78 percent more likes than those with little texture.
Images courtesy of Curalate.
November 11th, 2013 by Sarah Sluis
There’s a question all startups eventually have to ask themselves: How will we make money? Many internet companies have created a successful product first, and kicked the idea of making money down the road. Twitter, which just filed an IPO last week, is one of those companies. It still hasn’t earned a profit, but its market capitalization is nearly $20 billion. The IPO raised the company $1.8 billion, but Twitter’s lost $133 million so far this year. Long-term, the social media site will probably earn most of its money through advertising. But pre-IPO, it’s brought in a lot of its money simply by providing access to its data.
Twitter’s IPO filing revealed that the tweeting service is earning sizable revenue from licensing their user data. 15 percent of their revenue comes from paid access to the Twitter firehose, as it’s called, with the other 85 percent coming from advertising. Given projections that Twitter will double its advertising revenue in a year, big data will likely matter less to its bottom line. But it’s something that other companies have noted. For some startups, selling data may be one way to bring in money before other revenue streams mature.
During a conference last year, Instagram CEO Kevin Systrom noted that “Instagram isn’t necessarily a photo company, or a communications company as I like to say, we’re also going to be a big data company.” Systrom was saying this even though his company had been acquired for $1 billion by Facebook.
More mature companies like LinkedIn also earn money through their data. LinkedIn brings in three-quarters of its revenue through memberships that provide less restricted access to its data for recruiters, professionals, and all those companies pulling in LinkedIn information into their CRM systems.
What Twitter offers is worth paying for, according to those involved. The Twitter firehose is so powerful that a company sued Twitter when it learned the company planned to discontinue its access to the data source. While Twitter’s open API that allows for light analytics based on a selection of the company’s data, it doesn’t include every single tweet or allow search for a keyword based on all historical data. For that, you need to strike a deal with Twitter to gain access to the firehose, which captures all information, leading to some notably different observations.
Two big players with access to the Twitter firehose are Gnip and Datasift, which resell that information to companies that need slices of Twitter’s data. However, Twitter has also struck deals with other companies, like Salesforce.com’s Radian6, which offers intelligence on all social media.
Many companies are using big data to make decisions, but it’s often difficult to tell where it’s coming from, or what kind of transactions are involved to secure that data. For Twitter, big data was just the beginning. Soon, the adage “follow the money” may just turn into “follow the data.”