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Easy returns can enhance the customer experience

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Easy returns can enhance the customer experience

Spencer Kieboom is a man in love with what he does. “Reverse logistics is something I love — it’s so neglected,” he told us. “‘Return free in 90 days’ is a policy, not a solution, and there’s a big difference between the two. It’s just a policy somebody came up with in the hope it would lure more consumers into buying by alleviating the time constraint.”

Kieboom’s mission has been to find a way to make returns easier for consumers and less of a headache for brands. His company’s might be summarized as pick up at porch — but it’s not quite as simple as it sounds.

The reverse supply chain in crisis

In a time when brands and consumers have been consumed with anxiety about what we might call the “forward” supply chain — getting goods from the factory into consumers’ hands — there’s been less discussion about what happens in the reverse direction — the return of unwanted goods. Yet that reverse supply chain has been impacted by events like the pandemic too.

As we’re all aware as individual consumers, COVID vastly accelerated the adoption of direct-to-consumer e-commerce as a favored method of shopping, including for goods people had previously been accustomed to purchasing in person. “When COVID hit, what became very apparent to me within three to six months was that the winners either could adapt very quickly, or at least had the initial framework there, a framework that adds convenience to the consumer,” said Kieboom. “Consumers are going to flip over every stone for convenience, now even more than before. Moving forward, the companies that will be the winners in the next three to five years will be the companies that are looking at their supply chains from a strategic perspective instead of it just being a cost line.”

Easy returns enhance the customer experience, but they solve major problems too for retailers who can have millions of dollars of unpaid inventory waiting to be returned to them. Why the delay? Typically, says Kieboom, customers will wait out most of the free return period before bothering to ship the items back.

Labels, boxes lines

For over seven years, Kieboom was a professional baseball player, and had major league experience as a catcher with the Washington Nationals. He retired early and, it seems, flung himself headlong into his new field. He studied Amazon’s reverse logistics, processes at UPS and FedEx, Dick’s Sporting Goods’ RFID system, Ace Hardware’s “separate POS systems and how they affect inventory management.”

What he discovered was that “there’s a big hole in the reverse supply chain.” He sympathizes with the retailers. “The victim here is the retailer because they’ve been so focused on developing their forward supply chains to consumers to meet their demand that they’ve not met their own demand in doing so. The time of over 30 days it take a consumer to return unwanted goods crushes them. That time is related to labels, boxes and — my least favorite, personally — lines.”

The consumers’ attitude is that they will get around to returning things “eventually” and on their own time. The friction endemic to the return experience disincentivizes consumers. Packing and shipping is inconvenient, but there’s evidence that BORIS (buy online, return in store) is a negative experience too. “Buy online, pick up in store makes a ton of sense,” said Kieboom. When people pick up curbside or in store, he said, over 30% make a purchase in addition to the original online purchase. “BOPIS is here to stay. BORIS has less than a 10% buy rate, converting a new purchase.” Having to bring unwanted goods back to a store is not a great customer experience.

In most cases, it’s not good for most stores either. Online and in-store POS systems just don’t work together, Kieboom explained. Stores carry limited SKUs in comparison to SKUs available online. “You can’t just start selling other SKUs in your store. The next thing you know, they have a locker in the back that gets filled up and eventually gets picked up in a line haul, and that line haul takes it back and they say, just liquidate it, just get rid of it.”

Read next: Supply chain crisis impacts holiday shopping


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Solving through consolidation

Kieboom is the founder and CEO of Pollen Technologies Inc. (not to be confused with Pollen Technologies Ltd., a U.K. banking and payments solution). It’s mission is to help the retailer by removing those inconveniences to the customer that delay returns. The by-product, of course, is an improvement to a much-overlooked part of the customer experience.

“We offer simple scheduling in partnership with retailers,” he explained. The consumer is prompted to pick a date and time on the brand’s website or app. “It’s almost like a PayPal button,” he said. “We control the windows based on parameters of volume and density for that retailer — we’re not going to pick up stuff seven days a week with 1,000 returns in that area, but we’ll pick up stuff two days a week.”

The challenge was to align pick-up costs with the price of a shipping label. Although retailers want to see prompt returns, they won’t pay double or triple the cost of shipping to achieve that. "By doing pick-up at volume, you can get the cost down to $5 or $6 [per item] — that’s possible — but we also control consolidation. That’s what I learned with Amazon’s reverse logistics. With consolidation, which is what our technology does, we’re able to lower the per unit cost on shipping. You don’t need a label, you don’t need a box, we validate the goods on the porch.”

Using Pollen Returns is not mandatory for customers. “If the consumer wants to drop it off, they’re welcome to drop it off; we’re an additional service.” As might be expected, the advantages of density and consolidation imply an urban focus. “Twenty cities’ metro areas make up 70% of e-commerce and our initial focus is on fashion and apparel due to the time constraints from seasons, and fashion trends that lead to waste and dollars lost in the industry.” They’re looking at opportunities in other verticals like telecoms.

“We built technology that works within the existing eco-systems that are out there,” said Kieboom. “We’re not here to offer a new dashboard to somebody — they have enough, and there are companies that are really good at that. We’re here to expedite the return process by minimizing the inconveniences to consumers that make them take on average over 30 days to return unwanted goods. In doing so, you improve inventory returns and minimize waste. It really does bring a more circular supply chain into it.”


About The Author

Kim Davis is the Editorial Director of MarTech. Born in London, but a New Yorker for over two decades, Kim started covering enterprise software ten years ago. His experience encompasses SaaS for the enterprise, digital- ad data-driven urban planning, and applications of SaaS, digital technology, and data in the marketing space. He first wrote about marketing technology as editor of Haymarket’s The Hub, a dedicated marketing tech website, which subsequently became a channel on the established direct marketing brand DMN. Kim joined DMN proper in 2016, as a senior editor, becoming Executive Editor, then Editor-in-Chief a position he held until January 2020. Prior to working in tech journalism, Kim was Associate Editor at a New York Times hyper-local news site, The Local: East Village, and has previously worked as an editor of an academic publication, and as a music journalist. He has written hundreds of New York restaurant reviews for a personal blog, and has been an occasional guest contributor to Eater.


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Hur datarena rum kan hjälpa till att hålla internet öppet

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How data clean rooms might help keep the internet open

Are data clean rooms the solution to what IAB CEO David Cohen has called the “slow-motion train wreck” of addressability? Voices at the IAB will tell you that they have a big role to play.

“The issue with addressability is that once cookies go away, and with the loss of identifiers, about 80% of the addressable market will become unknown audiences which is why there is a need for privacy-centric consent and a better consent-value exchange,” said Jeffrey Bustos, VP, measurement, addressability and data at the IAB.

“Everyone’s talking about first-party data, and it is very valuable,” he explained, “but most publishers who don’t have sign-on, they have about 3 to 10% of their readership’s first-party data.” First-party data, from the perspective of advertisers who want to reach relevant and audiences, and publishers who want to offer valuable inventory, just isn’t enough.

Varför vi bryr oss. Two years ago, who was talking about data clean rooms? The surge of interest is recent and significant, according to the IAB. DCRs have the potential, at least, to keep brands in touch with their audiences on the open internet; to maintain viability for publishers’ inventories; and to provide sophisticated measurement capabilities.

How data clean rooms can help. DCRs are a type of privacy-enhancing technology that allows data owners (including brands and publishers) to share customer first-party data in a privacy-compliant way. Clean rooms are secure spaces where first-party data from a number of sources can be resolved to the same customer’s profile while that profile remains anonymized.

In other words, a DCR is a kind of Switzerland — a space where a truce is called on competition while first-party data is enriched without compromising privacy.

“The value of a data clean room is that a publisher is able to collaborate with a brand across both their data sources and the brand is able to understand audience behavior,” said Bestos. For example, a brand selling eye-glasses might know nothing about their customers except basic transactional data — and that they wear glasses. Matching profiles with a publisher’s behavioral data provides enrichment.

“If you’re able to understand behavioral context, you’re able to understand what your customers are reading, what they’re interested in, what their hobbies are,” said Bustos. Armed with those insights, a brand has a better idea of what kind of content they want to advertise against.

The publisher does need to have a certain level of first-party data for the matching to take place, even if it doesn’t have a universal requirement for sign-ins like The New York Times. A publisher may be able to match only a small percentage of the eye-glass vendor’s customers, but if they like reading the sports and arts sections, at least that gives some directional guidance as to what audience the vendor should target.

Dig deeper: Why we care about data clean rooms

What counts as good matching? In its “State of Data 2023” report, which focuses almost exclusively on data clean rooms, concern is expressed that DCR efficacy might be threatened by poor match rates. Average match rates hover around 50% (less for some types of DCR).

Bustos is keen to put this into context. “When you are matching data from a cookie perspective, match rates are usually about 70-ish percent,” he said, so 50% isn’t terrible, although there’s room for improvement.

One obstacle is a persistent lack of interoperability between identity solutions — although it does exist; LiveRamp’s RampID is interoperable, for example, with The Trade Desk’s UID2.

Nevertheless, said Bustos, “it’s incredibly difficult for publishers. They have a bunch of identity pixels firing for all these different things. You don’t know which identity provider to use. Definitely a long road ahead to make sure there’s interoperability.”

Maintaining an open internet. If DCRs can contribute to solving the addressability problem they will also contribute to the challenge of keeping the internet open. Walled gardens like Facebook do have rich troves of first-party and behavioral data; brands can access those audiences, but with very limited visibility into them.

“The reason CTV is a really valuable proposition for advertisers is that you are able to identify the user 1:1 which is really powerful,” Bustos said. “Your standard news or editorial publisher doesn’t have that. I mean, the New York Times has moved to that and it’s been incredibly successful for them.” In order to compete with the walled gardens and streaming services, publishers need to offer some degree of addressability — and without relying on cookies.

But DCRs are a heavy lift. Data maturity is an important qualification for getting the most out of a DCR. The IAB report shows that, of the brands evaluating or using DCRs, over 70% have other data-related technologies like CDPs and DMPs.

“If you want a data clean room,” Bustos explained, “there are a lot of other technological solutions you have to have in place before. You need to make sure you have strong data assets.” He also recommends starting out by asking what you want to achieve, not what technology would be nice to have. “The first question is, what do you want to accomplish? You may not need a DCR. ‘I want to do this,’ then see what tools would get you to that.”

Understand also that implementation is going to require talent. “It is a demanding project in terms of the set-up,” said Bustos, “and there’s been significant growth in consulting companies and agencies helping set up these data clean rooms. You do need a lot of people, so it’s more efficient to hire outside help for the set up, and then just have a maintenance crew in-house.”

Underuse of measurement capabilities. One key finding in the IAB’s research is that DCR users are exploiting the audience matching capabilities much more than realizing the potential for measurement and attribution. “You need very strong data scientists and engineers to build advanced models,” Bustos said.

“A lot of brands that look into this say, ‘I want to be able to do a predictive analysis of my high lifetime value customers that are going to buy in the next 90 days.’ Or ‘I want to be able to measure which channels are driving the most incremental lift.’ It’s very complex analyses they want to do; but they don’t really have a reason as to why. What is the point? Understand your outcome and develop a sequential data strategy.”

Trying to understand incremental lift from your marketing can take a long time, he warned. “But you can easily do a reach and frequency and overlap analysis.” That will identify wasted investment in channels and as a by-product suggest where incremental lift is occurring. “There’s a need for companies to know what they want, identify what the outcome is, and then there are steps that are going to get you there. That’s also going to help to prove out ROI.”

Dig deeper: Failure to get the most out of data clean rooms is costing marketers money


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Stig upp | Digital Marknadsförare

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Ascend | DigitalMarketer

At this stage, your goal is to generate repeat buys and real profits. While your entry-point offer was designed for conversions, your ascension offers should be geared for profits—because if you’re serving your customers well, they’ll want to buy again and again.

Ascension offers may be simple upsells made after that initial purchase… bigger, better solutions… or “done for you” add-ons.

So now we must ask ourselves, what is our core flagship offer and how do we continue to deliver value after the first sale is made? What is the thing that we are selling? 

How we continue to deliver value after the first sale is really important, because having upsells and cross sales gives you the ability to sell to customers you already have. It will give you higher Average Customer values, which is going to give you higher margins. Which means you can spend more to acquire new customers. 

Why does this matter? It matters because of this universal law of marketing and customer acquisition, he or she who is able and willing to spend the most to acquire a customer wins.

Very often the business with the best product messaging very often is the business that can throw the most into customer acquisition. Now there are two ways to do that.

The first way is to just raise a lot of money. The problem is if you have a lot of money, that doesn’t last forever. At some point you need economics. 

The second way, and the most timeless and predictable approach, is to simply have the highest value customers of anyone in your market. If your customers are worth more to you than they are to your competitors, you can spend more to acquire them at the same margin. 

If a customer is worth twice as much to you than it is to your competitor, you can spend twice as much trying to acquire them to make the same margin. You can invest in your customer acquisition, because your customers are investing in your business. You can invest in your customer experiences, and when we invest more into the customer we build brands that have greater value. Meaning, people are more likely to choose you over someone else, which can actually lower acquisition costs. 

Happy customers refer others to us, which is called zero dollar customer acquisition, and generally just ensures you’re making a bigger impact. You can invest more in the customer experience and customer acquisition process if you don’t have high margins. 

If you deliver a preview experience, you can utilize revenue maximizers like up sells, cross sales, and bundles. These are things that would follow up the initial sale or are combined with the initial sale to increase the Average Customer Value.

The best example of an immediate upsell is the classic McDonalds, “would you like fries with that?” You got just a burger, do you also want fries with that? 

What distinguishes an upsell from other types of follow up offers is the upsell promise, the same end result for a bigger and better end result. 

What’s your desired result when you go to McDonalds? It’s not to eat healthy food, and it’s not even to eat a small amount of food. When you go to McDonalds your job is to have a tasty, greasy, predictable inexpensive meal. No one is going there because it’s healthy, you’re going there because you want to eat good. 

It’s predictable. It’s not going to break the bank for a hamburger, neither will adding fries or a Coke. It’s the same experience, but it’s BIGGER and BETTER. 

Amazon does this all of the time with their “Customers Who Bought This Also Bought …” But this one is algorithmic. The point of a cross sell is that it is relevant to the consumer, but it doesn’t necessarily have to be aligned with the original purchase. What you don’t want to do is start someone down one path and confuse them.

You can make this process easy with Bundles and Kits. With a bundle or a kit you’re essentially saying to someone, “you can buy just one piece, or you can get this bundle that does all of these other things for a little bit more. And it’s a higher value.”

The idea behind bundles and kits is that we are adding to the primary offer, not offering them something different. We’re simply promising to get them this desired result in higher definition. 

The Elements of High-Converting Revenue Maximizers (like our bundles and kits) are:

  1. Fart

Om du är ett e-handelsföretag och säljer en fysisk produkt kan det se ut så här: erbjuder gratis frakt för beställningar $X eller mer. Vi vill ge dina kunder samma önskade resultat, men med mindre arbete för dem.

  1. Automatisering

Om du är ett möbelföretag och vill lägga till en Intäktsmaximerare kan detta se ut så här: Just nu för en extra $X kommer våra högutbildade medarbetare och sätter ihop detta åt dig. 

  1. Tillgång 

Människor kommer att betala för snabbhet, de kommer att betala för mindre arbete, men de kommer också att betala för en titt bakom ridån. Tänk på människorna som betalar för Backstage Pass. Dina kunder kommer att betala för en VIP-upplevelse bara så att de kan se hur allt fungerar. 

Kom ihåg att uppstigningsstadiet inte behöver sluta. När du väl har en kund bör du göra ditt bästa för att göra dem till en kund för livet. Du bör fortsätta servera dem. Fortsätt att fråga dem, "vilka behov möter vi fortfarande inte" och försök att möta dessa behov. 

Det är ditt jobb som marknadsförare att söka upptäcka dessa behov, föra tillbaka dessa till produktteamet, för det är det som kommer att göra det möjligt för dig att fullt ut maximera det genomsnittliga kundvärdet. Vilket kommer att göra det möjligt för dig att ha mycket mer att spendera för att skaffa dessa kunder och göra ditt jobb mycket enklare. 

Nu när du förstår vikten av uppstigningsstadiet, låt oss tillämpa det på våra exempel.

Hazel & Hem skulle kunna ha gratis prioriterad frakt över $150, ett "Boutique Points"-belöningsprogram med exklusiva "double point"-dagar för att uppmuntra till att spendera och ett exklusivt "Stylist Package" som inkluderar en komplett outfit anpassad för kunden. 

Cyrus & Clark kan behålla nuvarande kunder genom att erbjuda en årlig strategisk plan, "Klar för dig" marknadsföringstjänster som utförs på den strategiska planen, och den högsta nivån skulle tillåta kunder att vara det exklusiva företaget som Cyrus & Clark servar i specifika geografiska territorier.



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