How did an online retailer become not only a household name, but an essential part of the household? How can you compete against a one-stop shop where consumers turn for everything from streaming video and cloud storage to air mattresses and zip ties? We have the answer, but first, let’s take a peek into Amazon’s allure.
The Everything Store
Amazon’s compelling combination of convenience, price and an expansive ecosystem of products and services creates its own pull. Labeled the “virtuous cycle” by Jeff Bezos, their flywheel approach of adding more and more products and touchpoints is changing consumer behavior. According to recent research by Internet Retailer, Amazon is now the first place consumers go to research products. When shopping online, 59% of consumers surveyed said that Amazon was their first choice. Their second was Google at 20%.
This behavior is having a profound effect on the market. In 2016, 4 of every 10 dollars spent online in the US was spent with Amazon, and more than two-thirds of US ecommerce growth can be attributed to Amazon. During the same year, more than one-quarter of all US retail sales was attributed to Amazon.
Competing Against a Goliath
Competing with Amazon on price and shipping can be tough. Amazon offers such a variety of products and services that they can more easily give a little in price in one area to win big in another. But not every retailer can – or should – offer an ecosystem like Amazon’s. So what can you offer that Amazon doesn’t? That’s easy – a personalized experience.
Think about it for a moment. Amazon was one of the first retailers to offer product recommendations, but they haven’t capitalized on that as well as they could have. Their recommendations aren’t based on my past shopping behavior or information I’ve personally shared with them, so they’re often jarringly irrelevant. For instance, I recently carted an electric pressure cooker. Amazon recommended a clear replacement lid and spill-proof lids for a Yeti coffee mug, which I don’t own and have never even shopped for.
Additionally, Amazon’s communications with me are stilted and generally unimaginative. And the recommendations in their transactional emails are even more off track than those they offer on the site. For example, I just received a shipping confirmation for some 4” clip-on fans for my greenhouse. What recommendations did they include? An automobile oil filter and a base that turns a propane tank into a heater. What?
To compete with Amazon’s impersonal machine, you have to get real. Learn who your customers are, and segment your messages to show that you get them. Let me show you a few examples.
Retailers Who Are Getting It Right
Juice Beauty offers an all-natural line of beauty products. Although the products can be used by men or women, the brand appeals most to the millennial female who wants to take better care of herself. She’s attracted to clean, cruelty-free products made from fresh, organic ingredients. And millennials are digital natives, so Juice turned to social media and partnered with organizations and influencers who could help amplify their message.
Juice Beauty knows their target audience, and they’ve identified the right channels to have a conversation with them. How do they use that knowledge to differentiate themselves? They “speak the language,” explained Director of Digital Jeffrey Grannis. “This age group does their research. They really want to know what’s in the product, and we are fully transparent about that.”
The results: New customers are up 45% year-over-year, and millennial website visits are up more than 90% year-over-year. “It’s our fastest-growing segment.”
Tommy John, a premium men’s underwear label, needed a solid handle on who would be a good fit for their products. Guys who wear all sorts of clothing can benefit from undershirts that stay tucked, underpants that don’t bind and socks that stay up. But at $40 for an undershirt, the company felt that their initial target should be men who wear suits.
Once they identified their persona, Tommy John used it to differentiate their products from the mainstream brands and even other high-end brands. The company sticks to events and marketing tactics that appeal to “their guy.” For instance, they sponsor PGA events and even took over New York’s Wall Street subway station, plastering it with ads that spoke directly to the confident, professional male. Each double entendre reinforced the comfortable fit, including “Tommy John in a nutshell? A nutshell.” And they got very creative with euphemisms to show that men who don’t wear Tommy John don’t belong, including “No Cave Diving,” “No Dice Rolling” and “No Holster Jolting.”
Their goal? Connect with the right shopper and then keep him coming back. And they’re well on their way.
And finally, let’s take a look at tarte high-performance naturals™. Maureen Kelly founded the line of healthy, eco-chic cosmetics and beauty products for herself (a self-professed beauty addict) and others like her who want an all-natural, high-performance product in “chic, runway-inspired cases and compacts.” Having identified the target audience, tarte then needed to engage and inspire loyalty.
“Shoppers expect us to know who they are from the second they land on the site through the purchase experience and beyond. If the message [we’re] delivering isn’t relevant to her, she won’t engage,” says Stephanie Urban, digital marketing director at tarte. “From product recommendations to personalized email creative and affinity-based offers, marketers need to find the little touches that will drive a lift in conversion.”
Their personalization tactics are working. “In the past year, our email channel has grown over 200%. We’ve seen significant lifts in engagement, traffic and revenue,” Urban said.
Personalization = Success
These are not isolated successes. I could name many more, but I think I’ve made a believer of you. So let me point out a couple of resources. First, Engage and Sell: The Tools Every Commerce Marketer Needs to Succeed highlights how personalization tools can move the revenue needle. And 3 Essential Elements of Personalized Commerce Marketing details what you’ll need to successfully automate and scale your personalization efforts.
If you need more, please reach out to me in the comments or via LinkedIn. I’ll be happy to point you in the right direction.