Category Archives: Big Data

Are Loyalty Programs Getting Lost in the Shuffle?

Image from Technology Advice

A wide range of innovative loyalty programs are in the marketplace, and they report impressive ROI and user engagement. But are they a high priority for retailers? Many retailers (and their agencies) have been slow to commit to loyalty programs.

At ShopTalk in Las Vegas May 16-18, loyalty programs seemed to have gotten lost in the shuffle of digital solutions (i.e. omni-channel, email, artificial intelligence, email). As eMarketer Yory Wurmser noted, “loyalty programs are of mixed importance…loyalty rates are going down.” He added that programs delivering direct gains in “transactions” or “emotional” allegiance to brands and retailers will have a leg up over pure-play loyalty solutions.

Quidsi CEI Emile Arel Scott also noted the limited appeal of pure-play loyalty programs. “We have gone through so many loyalty programs,” said Arel Scott, whose company is owned by Amazon. “They are a lot of work. Better service and customer feedback are much more important than points,” he said.

“The real struggle is for brands to find a message outside of ‘25% off’ or a sale,” Arel Scott added. “The key is to continue to get more specific in messaging,” he said, noting that chats seem to hold a lot of promise in this direction.

For Index CEO Marc Freed Finnegan, it all comes down to getting customers to build an account with a retailer, where all the data can be kept. An account “remembers everything I buy. Loyalty is a leading way to get there,” he said. But so are mobile accounts and other channels that stimulate incremental revenues.

Does this mean that loyalty programs aren’t poised for success? Not really. Many of them, especially card linked offer programs, have already evolved into broader programs that provide the useful analytics, feedback and targeting capabilities that the ShopTalk panelists alluded to. But it is an ongoing battle to gain a retailer’s attention, given all the industry solutions out there.

Closing the Loop: Online Loans Help Drive SMB Marketing


There is an increasing amount of overlap between front office functions (advertising, marketing, PR, presence management) and back office functions (human resources, scheduling, delivery, payment processing, accounting, business analysis).

ReachLocal, for instance, has been delivering services on both ends with ReachEdge. It isn’t alone. A number of companies are engaging in “A Commerce” (Appointment Commerce), which takes data to promote open slots in a schedule. Now in the works: loans based on an analysis of business results and needs, and that are applied to specific marketing efforts.

Online loan providers look at a variety of SMB data as part of the approval process, including marketing-based results (conversions, etc.) This especially helps newer SMBs that can’t work through banks because they have a short history of business results and limited assets to use as security for loans.

The new breed of online loan providers include Peer-to-Peer lenders such as Lending Club, Avant and Prosper; new Big Data oriented players such as Kabbage, OnDeck and ForwardLine; and new loan units from large payment processors such as PayPal, Square and Amazon.

Kabbage’s automated model assesses three factors: capacity to repay, character, and the consistency or stability of the business. For the latter, it looks at an SMB’s financial history with such transaction channels as PayPal, Amazon, Sage, eBay, Stripe, Etsy, Yahoo, Authorize.net and Square. Kabbage’s motto? “We actually want to lend to Small Business.”

Another approach is taken by ForwardLine. Chief Revenue Officer David Teichner tells us that many of the loans are used for marketing campaigns that will prove instrumental for an SMB’s growth. Typical loans are in the $30-50K range.

“Small business owners want to grow their business,” says Teichner. Some of ForwardLine’s loans are used for working capital, additional retail space or other business needs. Many of the loans are being applied specifically for marketing programs — sometimes in partnership with companies who provide SMB marketing services.

This is dynamic stuff that begins to blur the lines between front office and back office. We’re watching this space with real interest and believe that loans and the analytics around them will be connecting many of the dots in SMB marketing.

At the same time, however, we note that the space has suffered a black-eye this week due to a news scandal coming out of Lending Club, the largest company in the space, including loose compliance to loan standards. The scandal is likely to put the entire space under a microscope for awhile, although we expect that the industry will continue to develop.

Local Onliner Bookshelf: The FinTech Book

The application of Financial Technology is a major part of our vision for local ‘close the loop,” transaction marketing. As an executive from MasterCard Advisors noted during one of our 2011 events, “You are what you buy, not what you search for.”

Customer analytics, prepaid deals, loyalty programs, card linked offers, small business loan programs and alternative payment services such as ApplePay constitute the bulk of the local angle for FinTech. And in theory, it brings the banks and credit card industry directly into the local marketing sphere. There’s a reason we’ve seen a steady stream of local marketing leaders flocking to events like Money2020.

Beyond our local focus, however, the development of FinTech has mostly been used to bring about an alternative to traditional banking, which has largely failed to evolve with the times: over-charging, over-complicating and under-delivering for services – especially to SMBs. As Citi’s Chief of Client Experience for Digital Heather Cox said: “People need banking, they don’t necessarily need banks.” If banks are going to re-engage, it will only be to use their remaining market power to rebundle the host of financial services now available from numerous players.

These themes dominate in The FinTech Book, a new crowd-sourced reference work comprised of contributions by 86 FinTech authorities. Compiled by Susanne Chishti and Janos Barberis, the book is heavily oriented towards international markets. London is the hub of the FinTech world, not San Francisco.

Oddly, given its overall depth, there is almost nothing on the use of FinTech for transaction marketing (and the paper back version of the book is quite floppy and hard to hold — go electronic.) But this book will remain the standard reference on the FinTech landscape for some time.

Artificial Intelligence Helps Fill-In Schedules for SMBs

Marketing automation is playing a key role in making local scale for many marketers. It’s been front-and- center for companies like Demand Force, InfusionSoft and SignPost. Another contender is Frederick, a 20+ person marketing automation company based in San Francisco that was recently acquired by Booker.

Frederick takes a Big Data approach to data it receives from Booker and a host of other platforms. Using a combination of artificial intelligence and automation, it works with SMBs in a number of vertical categories that rely on frequent visits from customers (i.e. health & beauty, auto repair) to fill appointment slots. It also helps reinforce and engage customer relationships via reminders, review solicitations, upsells and cross-sells.

The company’s goal is to build a 1:1 marketing plan for its customers. In doing so, Frederick CEO and co-founder Corey Kossack tells us that the company looks at a number of variables, including customer transaction history, service sale-through rates, staff utilization rates and daily occupancy information.

While there hasn’t been a long track record – the company was founded in 2014 — customers are averaging revenue growth of 30% year over year, says Kossack. “What we have found is that structured data can be used to drive better results than segmenting a Constant Contact list,” he says.

Frederick’s application of Artificial Intelligence is what Kossack believes is its differentiator. “We are unique here in that we make decisions on behalf of the business based on proprietary algorithms,” he says. “Frederick is like a living, breathing marketer, studying millions of data points to determine what to do next.”

“Hey Alexa!” HomeAdvisor, TalkLocal Are Customizing for Amazon Echo

Amazon Echo represents a new eco-system for commerce, and is arguably, one of the biggest innovations in recent years. By simply voicing a request triggered by a common command, (“Hey, Alexa”), users can tap into hundreds of apps that are being specially designed to link their Web info – from movies and music to medical info. The key to Echo’s success over Apple Siri or Microsoft Cortana is that it is hands-free. The speaker can “hear” across the room and very quickly respond.

Over the next several months, Echo is likely to go even bigger, as the original $179 hands free speaker is now being supplemented by Amazon Tap, a smaller $129 portable speaker. The software is also being built into various devices.

We’ve been wondering how long it would take for it to hook into local services. Last week, HomeAdvisor added its Instant Booking feature, which sends service pros out to a location. CEO Chris Terrill said in a statement that “Smart-home platforms are the next big growth accelerators for local home services, and no other player in our category has the scale or technology to unlock the power of the connected home for homeowners.”

TalkLocal is also being added to the system. That makes total sense to us. TalkLocal is a service that automatically captures user’s calls, transcribes the message for its request elements, and links it to local services as a lead.

Co-founder Manpreet Singh tells us that TalkLocal initially expects a modest trickle of leads – 12 or so – to come in via Echo. “Few people will anticipate their plumbing needs. You’d have to be very lucky to discover us while in the midst of a plumbing problem,” he says. “Over time, more people will discover us.”

Deploying for Echo has been an experience for TalkLocal, which has worked closely with the Echo team in Seattle. Singh notes that TalkLocal has had to adapt to Alexia’s unique linguistic needs. “Designing commands and rules for a voice-enabled AI can be like finding a powerful but very clever trickster genie,” he jokes.

Experimentation has also been required. While TalkLocal provides over 40 service categories, it will launch with just a few. “Each service category is a virtual paradigm shift in terms of relevant terminology and possible linguistic pitfalls,” says Singh. We also want to give ourselves the opportunity to learn more about how users interact with the current skill.”

Singh adds that TalkLocal plans to do beta testing “with a ton of users” before launch. “We need as many users as possible engaging with this new type of technology. We can only anticipate so much about what people will say and do, or what expletive or prank requests they might try to submit,” he says.

TalkLocal’s Manpreet Singh

SMB Loyalty Marketing Trends: A Discussion with Venga CEO Sam Pollaro

Venga CEO Sam Pollaro

The conventional wisdom in the industry is that a loyal customer brings in 5X the revenue of a new customer. A slew of loyalty marketing platforms are reinforcing the CW with new technology that reach deeply into understanding and targeting loyal customers with superior analytics, incentives and ad campaigns.

Loyalty platforms include such players as Upserve (formerly Swipely) and Fishbowl. Another one of these platforms is Venga, a provider of loyalty services for 500+ sit-down restaurants in the U.S., Canada and the U.K.

CEO Sam Pollaro tells us that Venga has seen a shift in the loyalty market over the past couple of years. It has begun to change from explicit loyalty programs (i.e. punch cards or card linked offer programs) to implicit programs using payments and social media to more subtly track customers and their habits.

Pollaro says Venga’s goal in its implicit approach is to “surprise and delight.” “When customers spend $500, an alert might be added to their profile,” and they might be given a dessert or a special table the next time they come in, he says. Or if they have indicated they like a certain kind of wine, they can be notified when a special shipment comes in.

Offine-to-online marketing is another trend that Venga is riding, mostly with the help of social media. Facebook, in particular, uses its direct response capabilities to help Venga develop “Fan Builder” campaigns, that lead to more Facebook likes; “We Miss You” campaigns that target customers that haven’t come in for a while; and “Special Interest” campaigns that will target customers based on their past visit and purchase history with specific imagery in an ad, such as a wine or beer bottle.

More than 50 percent of customers can be tracked down on Facebook from customer lists with just a phone number, says Pollaro. Because they are Facebook members, there are no opt-in requirements, he notes. The program is especially useful, since restaurants typically can only collect emails from 10-15 percent of their customers. Facebook is also more effective than programs such as Gmail, since Gmail now segregates promotional emails.

Venga is seeing especially good results for its clients since it is targeting consumers that are already fans. Pollaro says the company sees 3-5X typical restaurant response rates. The high click-through rate also cuts cost-per-click rates by 50 percent or more.

MarTech’s Growing Impact on Local, SMB and Niche Marketing


Chief MarTec Scott Brinker

MarTech — the integration of software and marketing — is a wild card in the new generation of marketing. The new era of Martech takes into account not only ads and promotion, but content and experience, social and relationships, commerce and sales, data and management. The question for us is how it all ultimately applies to local, SMB and niche marketing.

It is certainly true that we’re increasingly focused on MarTech-centric issues: such as driving more customer loyalty and upsells via engagement, utility, targeted promotions and analytics. In our space, its been the differentiator and evolved focus for such social and promotions oriented companies as Radius Intelligence, Surefire Social and Signpost.

The keys are the “marketing pace layers,” as described by sector pioneer Scott Brinker, in his new book, “Hacking Marketing.” Brinker notes that in the modern era, campaigns take weeks, tactics take days but feedback and iterations (i.e. social media and messaging) are in real time and have become increasingly important. While advertising will often retain a central place, other critical channels are now invited into the “core“ marketing experience. Brinker thinks it is a 70/30 ratio.

In a keynote live streamed at his MarTech conference today in San Francisco, Brinker previewed many of the attributes of the MarTech revolution. Brinker notes that there were 350 companies in the space in 2013, 1,000 in 2014, 2,000 in 2015 and more than 3,500 in 2016 – 87% growth in the last year alone.

One of the key attributes of the space is that its scope and marketing relies on so many pieces that the Microsofts and SAPs of old –which assembled monolithic building blocks of tech — no longer really apply. All the companies in the space are constantly iterating and borrowing or partnering from each other. “The real story is: how do you leverage the opportunities,” says Brinker.