The Experts

Fibendall_150x143_4_normal
Fi Bendall
Expert
+ About Fi Bendall

Fi Bendall is chief executive of The Bendalls Group and a Westpac/AFR 2015 100 Women of Influence, who was described by CEO Magazine as 'The CEO's Secret Weapon'. An expert and pioneer in digital strategy, she has over 23 years’ experience in the digital and tech sectors.

Are chatbots harming your customer service reputation?

Monday, November 12, 2018

Chatbots have become a part of how many organisations deal with customer enquiries. But are chatbots doing more harm than good for your business and its customer service reputation?

Adopting new technologies is a positive thing to do, but a blind devotion to new technology, when you can see it's not working, or harming your business, is foolish. In business, we often have to weigh up whether we opt for cost-effective options that may change or even negatively affect our customer service offering. For many companies, especially small and medium-sized ones, the adoption of chatbots presents this dilemma.

Once instituted, there are cost-savings for businesses using chatbots. Resources can be shifted from costlier human-facing customer service interactions to chatbot-based interactions. It also theoretically frees human customer service staff to handle higher level operations and tasks.

Once the initial outlay for a chatbot build and deployment has been made, there is minimal ongoing outlay. The same can’t be said about human customer service teams.

However, chatbots have still not developed the capacity to deal with anything but the most basic enquiries, requests and conversations. Despite the massive hype that has accompanied the ‘chatbot revolution’ many people, especially those customers dealing with chatbots, remain frustrated.

Writing in TechCrunch two years ago, Faisal Khalid asked ‘Why do chatbots suck?’: “I mean, there’s not a single chatbot I can think of that has won wide praise, or, more importantly, that has proven that chatbots are actually easier to use than an app.”

Only a year or so ago, I expressed a slightly less negative but still sceptical stance in SmartCompany, when I asked ‘Can chatbots be true brand advocates?’: “Chatbots are still fairly one-dimensional and basic, without the sort of analytical capacity that a really clued in salesperson or customer service agent might possess.”

And just recently, HubSpot’s Justin JW Lee wrote at length about the chatbot sizzle turning to fizzle, as organisations have struggled to meet customer expectations for service:

It’s said that a new product or service needs to be two of the following: better, cheaper, or faster. Are chatbots cheaper or faster than apps? No — not yet, at least. Whether they’re ‘better’ is subjective, but I think it’s fair to say that today’s best bot isn’t comparable to today’s best app.

A key aspect of whether chatbots are the real deal or not is how an organisation uses them in conjunction with other customer service channels, from good old-fashioned human-staffed call centres through to social media response channels.

Another critical factor is the scope of complexity that an organisation deals with from its customers. The more complex and far-ranging the queries and requests, the less useful chatbots are likely to be for customers. That is, unless the customer service chain is engineered in such a way as to be able to deploy chatbots as a screening frontline that can efficiently handle simple requests while skilfully delegating more difficult ones.

However, not enough chatbot programs appear able to do that at this stage. The risk then is that this alienates customers even more from the customer service process, leaving them with a poor experience, and organisations with a poor reputation for service.

In his article ‘Emotionless chatbots are taking over customer service – and it’s bad news for consumers’, Professor Daniel Polani argues that chatbots still lack the most essential of traits for excellent customer service — "compassion and goodwill":

They have the potential to improve some aspects of customer service and are certainly easier to use than automated phone systems that struggle to understand even your basic personal details. But they're also another hurdle separating customers from a human who can actually answer difficult questions and, crucially, show the compassion and goodwill that strong customer service is often based on. There's a chance that chatbots could cause both consumers and companies to find this out the hard way.

Returning to Justin Lee, he argues that we’ve now entered a zone of deflated expectations for chatbots, with more realistic assessments. Chatbot technology is established and can only get better from here, he says.

“The hype is over. And that’s a good thing. Now, we can start examining the middle-grounded grey area, instead of the hyper-inflated, frantic black and white zone,” Lee writes. “I believe we’re at the very beginning of explosive growth. This sense of anti-climax is completely normal for transformational technologyMessaging will continue to gain traction. Chatbots aren’t going away. NLP and AI are becoming more sophisticated every day.”

So there’s still hope on the horizon for chatbots and what they can potentially do for customer service interactions.

As a business, though, you have to decide if that horizon is close enough for you to expend valuable resources on a piece of technology that is probably just as likely to irritate as it is to delight your customers.

 

Health and wellness in the digital age

Wednesday, November 07, 2018

Smartphones, Fitbits and health and wellness apps have all changed the way we train and even meditate. What's next on the digital horizon for health and wellness? 

While we might think of health and wellness as a physical arena, somewhere we escape to from the sedentary poisoning of a life lived looking at screens, the truth is that many of us are using digital tools to get the most out of our exercise and relaxation regimes.

The relationship between technology and health and wellness is not entirely new. Exercise, in particular, is a measurable activity. We can time how far we run in a set amount of time; our heart rate; how many steps we take; what we eat; and much more. Think about how the humble stopwatch would've changed the way runners approached their sport.

According to the TimingSense website, the first race events to be timed were horse races in the UK in the 1750s, while human athletics events first began to be timed in 1850 at Oxford University. Even if we're not competing with others, many of us like to compete with ourselves. We like to get the most out of our exertions and physical endeavours.

Peter Drucker famously said, “If you can't measure it, you can't improve it.” Drucker was speaking about business processes, but the maxim has become just as applicable to health and wellness pursuits. It’s the thinking at the heart of the ‘quantified self’ movement that has arisen over the past decade or so, which seeks to monitor, measure and improve all aspects of our lives, but especially our physical beings.

Journalist Gary Wolf has chronicled the Quantified Self movement and he says it's not only about changing your physical self, but also about changing how you think about yourself, your self-perception.

“We know that new tools are changing our sense of self in the world. These tiny sensors that gather data in nature, the ubiquitous computing that allows that data to be understood and used, and of course the social networks that allow people to collaborate and contribute,” he explained in a TED Talk on the topic. 

“But we think of these tools as pointing outward, as windows, and I’d just like to invite you to think of them as also turning inward and becoming mirrors. So that when we think about using them to get some systematic improvement, we also think about how they can be useful for self-improvement, for self-discovery, self-awareness, self-knowledge.”

The Quantified Self movement is barely ten years old. As biometrics collides with artificial intelligence and machine learning, we're going to see even more innovations and advances in how we think about health and wellness. The Fitbit of today will seem as old-fashioned as a stopwatch. Once we factor in developments in areas like nanotechnology and the health sciences, we will be at a new frontier for how we approach health and wellness.

As Baby Boomers continue to search for the fountain of youth, or at the very least, a more satisfying path to getting older, expect to see more venture capital pour into technology that will help us better measure our activities and improve both our physical and mental health.

 

Is there anything sexier than tyres?

Monday, October 29, 2018

There's nothing sexier than tyres. At least that's the impression one might get from looking at a Pirelli Calendar. Not that you see that many tyres in The Cal™. A lot of gorgeous women, not many tyres. 

The automotive industry, including the wheel and tyre sector, can often feel a little like it’s stuck in some kind of Jeremy Clarkson timewarp. However, even it is making some concessions to the changing times. It has to, with the likes of Tesla, Google (through its subsidiary Waymo), and even Apple looking to revolutionise the way we drive and use cars.

A recent example of a company looking to change with the times is American tyre company with its new prototype boutique retail offering called Roll by Goodyear.

Roll is an interesting example of how businesses can reconfigure what they offer to tap into new, potentially lucrative market segments. It's also another example of companies in traditionally male-skewed product categories waking up to the fact women buy their products, often in great numbers, and there’s money to be made if you’re smart to that fact.

According to Goodyear, Roll came about following a great deal of consumer research that found many people, men and women included, found buying tyres to be an onerous and time-consuming task. The upshot of the research was that it would be a good thing to make buying tyres quicker and easier. Not exactly groundbreaking stuff, but sometimes even the most obvious things can elude big companies and even whole industries.

It’s usually blindspots like this that disrupters exploit. Alarm bells should always ring when the prevailing attitude in a business or industry is ‘that’s just how we do things?’

“Roll by Goodyear makes buying tires easier,” said Fred Thomas, vice president and general manager of Goodyear Retail, in the company’s media release. “Guests can choose when, where and how to install their tires and they are in complete control of the process from start to finish. Goodyear is eliminating the waiting room and giving people time back in their day to do the things they really want to do.”

Again, it's not rocket science. However, what's especially interesting about Roll is the concept and the look of the store tested very well with Millennial women. The design of the store is quite elegant. You can see why young women might be keener to pop in and browse the store for a new set of tyres than in your standard blokey tyre shop. It does look a little like an upmarket shoe store — but with tyres on the wall.

Source: Goodyear

Another factor that might be underlying this trendier, more customer-focused concept is that Goodyear is vying with other tyre companies for the loyalty of the Millennial generation, which is now well into its car ownership years. Hook them in young and they might stay loyal for a lifetime, so the thinking goes. That line of thinking is maybe not as sound as it once was, but it’s certainly a consideration. 

Of course, it will take more than a beautiful showroom to win young people and women over. Excellent service and convenience are a big positive though. 

Companies that have traditionally marketed their products to men can no longer ignore women or treat them disdain. There's too much money to be made to do that. Aside from being the Chief Purchasing Officers of the Home, women are also making decisions for themselves about what they want to buy. Women are far less likely to rely on a man in their life to go and buy tyres for them these days.

Goodyear's Roll is just one example of the way modern businesses have to rethink their approach to selling. It's not exactly revolutionary, but it's a welcome bit of forward-thinking in a sector not noted for its progressive thought.

 

What's driving the e-Scooter investor frenzy?

Tuesday, October 23, 2018

Silicon Valley's fervent investor community is prone to manias, especially since the rise of Uber, and the latest seems to be focused on electric motorcycles and scooters. Behind the frenzy is a belief that in a world with a growing population, mass urbanisation and diminishing resources, electric scooters and bikes might well be the main form of transportation for lots of people around the world very soon. 

But will Silicon Valley necessarily come up with the solution to the problem of how people get around urban areas in the coming age of autonomous vehicles, especially what’s referred to as ‘last-mile transportation’?

There’s already plenty of money pouring into e-scooter hire startups like Bird and Lime, which operate services that rent out scooters to people for short rides, both are powered by apps that allow you to locate, hire and unlock the scooters. 

The proposition is simple. These are lightweight, easily operated, battery-charged vehicles designed to get you from Point A to Point B in congested and built up city areas. For example, instead of getting in the car to travel a couple of kilometres in heavy traffic, you use the app to find your nearest scooter and scoot your way to where you want to go. 

It’s a variation on the Uber rideshare model, scaled down from car to scooter. In fact, Bird’s founder and CEO, Travis VanderZanden, is a former executive at both Uber and its rideshare rival Lyft. Bird was launched in September 2017 and since then has raised $415 million, with valuations for the company now running between US$1.5 billion to $2 billion. It’s most recent funding round in June raised $300 million.

Similarly, Lime has attracted its share of dollars too, $467 million since launching in June 2017, as investors scramble to get on board. Lime has also partnered with Uber, which will integrate Lime scooters into its apps, and was a principal investor in Lime’s most recent funding round, which raised $335 million. 

Plenty of big-name VC firms have been effusive about both Bird and Lime, and the ‘last-mile’ urban transport space in general, with the likes of Sequoia Capital, Accel and CRV all backing Bird, while Andreessen Horowitz and GV have taken stakes in Lime.

Explaining his thinking behind investing in Bird, B Capital partner Raj Ganguly said: “Ultimately, Bird has the potential to completely change how we think about short-distance mobility.” 

However, there’s also a fair degree of scepticism about just how profitable or even viable these e-scooter companies will be.

“Doesn’t it feel like the Uber heyday all over again? On some level, I get it—but also, I want no part in it,” one investor told Vanity Fair. “There’s liability issues, regulatory issues.”

“If I’m being honest, it feels like a short-term trend,” another investor said. “It already feels like a lot of the FOMO-stricken players and firms who missed out on companies like Airbnb or Uber are diving in.”

The e-scooter companies also face hostility and opposition from local government and the general public. Some US local governments have tried to work with the scooter companies, but others have banned them outright.

Like the bike-share companies such as oBike that popped up around Australian capital cities recently and subsequently disappeared, many have accused the scooter companies of creating a public nuisance. The reasoning is mainly because of users leaving the scooters all over sidewalks, as well as zooming through crowds at (relatively) high speeds. So while some people might love the scooters, many others are not so fond.

The Uber business model has proved to be successful, but applying it to e-scooters might prove to be a novelty blip on the radar. There’s probably a real need for this type of transport solution in the high-density urban centres of the developing world, but the Silicon Valley mindset might not have the answer to this specific problem.

 

 

 

Is time up for retail fashion's old guard?

Wednesday, October 17, 2018

It’s tough days in fashion retail. There’s lots of competition, from online and traditional, and margins have been cut finer than a Savile Row suit. Nowhere is this more apparent than in the UK, especially among High Street retailers. One of those retailers feeling the bite is Topshop, which recently reported a £12.6 million hit to its bottom line.

So when it abruptly cancelled an in-store promotion recently with Penguin Books for a book called “Feminists Don’t Wear Pink”, it earned the ire of a decent chunk of its customer base, young and fashionable women, and put its brand reputation among this influential group in serious jeopardy. 

Topshop cited creative and production reasons for pulling the plug on the promotion. However, the media and the Twitterverse quickly looked past this explanation, and pinned the blame on Topshop’s 66-year-old owner, Sir Philip Green, who has become the villain of the piece.

Actress Thandie Newton, one of the book's contributors, summed up the outrage when she tweeted: “Yesterday #PhilipGreen used his big muscles to smash up the @Topshop @penguinrandom #FeministsDontWearPink pop-up because he thought it was too controversial!!? LOSER.”

Whether it was actually Green who ordered the promotion be stopped is unclear. As some background to the story, it should be noted Green is not exactly a fan of Penguin Books, after it published a scathing unauthorised biography of him this year. The fact is Green might well have been pissed off that one of his managers signed off on a promotion partnership with the publisher of a book that had done so much damage to his reputation, rather than taking any offence to one of his stores being used to promote a feminist book.

However, as PR people put it, the optics are bad. And the optics can get very blown out and ugly once fed through the lens of social media. 

Topshop issued an apology the next day but by then the impression had been well and truly cast that theirs was a brand that does not support the empowerment of young women. That’s not a good place to be for a retailer which is reliant upon the custom of young women, especially when competition is hot and new retail outlets are breathing down your neck.

Topshop has been one of the leading fashion retail brands among young women in the UK for decades now. It started out as a youth-oriented offshoot of department store Peter Robinson and soon became part of the Swinging London fashion scene of the 1960s with its flagship store in Oxford Street. It was one of the earliest of the UK fashion retailers to take its online presence seriously, launching the UK’s first online fashion store in the 1990s. It is also seen as one of the most progressive of the High Street fashion retailers, initiating policies on everything from gender-free change rooms to animal-friendly PETA-approved fashion. 

However, Topshop, which is owned by Green’s Arcadia Group, has recently faced challenges on several fronts. 

Last year, its foray into the Australian market came to an acrimonious end, with the $30 million collapse of its Australian franchise. Its efforts to take on the American market have also placed it under strain, with some analysts believing the US expansion has distracted it from the robust competition it faces in the UK from the likes of River Island, H&M and Primark, plus up-and-comers like PrettyLittleThing and Missguided.

“Topshop has lost some of its edge and I suspect that’s because it has been trying to please the American market, which is less fashion forward. It’s had to dumb down a bit. It’s very subtle, but that means it’s lost some of its edge in the UK,” retail analyst Richard Hyman told fashion business journal Drapers.

Contrast Topshop’s feminist fashion faux pas to the body positive coverage PrettyLittleThing has received recently, and you get an idea of how important it is for fashion brands to be seen to be doing the right thing by their customers. 

PrettyLittleThing launched a campaign featuring ‘plus size’ models, which is not revolutionary, but when placed next to Topshop’s feminist shutdown, it shines as an example of a brand supporting and empowering women: “At PrettyLittleThing we are all about celebrating body diversity and we believe everybody is beautiful.”

What a lot of people don’t recognise is that fashion has always been a highly politicised and even ideological arena, especially so in the UK: fashion has meaning. Women are very awake to this and they can quickly sniff out brands that align with their beliefs and those that don’t. What brands stand for, and how they communicate that with their customers, is vitally important. Brands that can’t keep up with their customers’ expectations on this count will lose their respect and trust. 

The old guard of fashion retail, like Sir Philip Green, should tread carefully because never have women been as vociferous about their place in the world as they are now. Fashion moves quickly, even more so in the age of fast fashion and social media. Today’s cutting edge fashion brands could soon become tomorrow’s remaindered stock.

 

When bullies win, we all lose

Tuesday, October 09, 2018

Recent comments from women in Australian politics show bullying and intimidation are rife in public life. It's a problem in corporate life too. The problem with a culture that accepts, and even encourages, bully behaviour, aside from its obvious nastiness, is that good people eventually say ‘enough is enough’ and move on to some other place that will hopefully respect them and care for their wellbeing. In the case of politics, that means we eventually get a smaller and less talented pool of people to represent our interests.

Research from beyondblue shows bullying is unfortunately widespread in Australian workplaces. From your local retail strip shop right up through to the corridors of corporate power, almost 50% of Australian employees will experience some form of workplace bullying during their lives, according to beyondblue. 

Bully behaviour comes in many shapes and sizes, from the despicable and degrading hazing rituals to which trades apprentices have long been subjected through, to the reputational destruction wrought by whisper campaigns among even the highest levels of executive management. None of it is acceptable. Too many people are hurt, mentally and even physically in some cases. The mental health toll of bullying is substantial, along with the loss in workplace productivity that goes with it.

Changing that culture requires decisive and robust action from leaders.

“Bullying is usually blamed on individuals, or interpersonal problems, or ‘personality clashes’. This is too simplistic. Bullying occurs because of cultural, organisational and structural issues in the workplace,” said beyondblue CEO Georgie Harman, in response to beyondblue’s research findings. 

“Change requires root and branch reform of organisational culture, led decisively from the top by committed, unequivocal, strong leaders and managers.”

Unfortunately, across too many organisations, we too often see little effort put into changing the rotten cultures that harbour and foster bullying. 

The recent revelations of the kinds of bullying that have gone on in the federal Liberal party probably don’t surprise those who know a bit about how the business of politics is conducted. The former Foreign Affairs Minister Julie Bishop acknowledged as much with her recent comments in the wake of the resignation from Parliament of fellow Liberal MP Julia Banks.

“When a feisty, amazing woman like Julia Banks says this environment is not for me, don't say 'toughen up princess', say 'enough is enough',” Ms. Bishop said.

“Politics is robust, the very nature of it, it's not for the faint-hearted,” Ms. Bishop said. “I have seen and witnessed and experienced some appalling behaviour in Parliament, the kind of behaviour that 20 years ago when I was managing partner of a law firm of 200 employees, I would never have accepted… Yet in Parliament it's the norm.”

You may not agree with her politics, but why should Sarah Hanson-Young put up with the degrading, sexist comments levelled at her by Senator David Leyonhjelm? Why would a woman, doesn’t matter what stripe of politics she represents, bother running for Parliament if she’s going to be treated horribly?

Similarly, why would a woman bother to become a board member if she’s going to be ignored or even ridiculed for her contributions? Thankfully, I have not had this experience, but I certainly personally know women who have. These are women who have come onto a board in good faith to share their knowledge and expertise and then either been treated like an adornment at best or as an existential threat to the men on the board at worst.

Seriously, why put yourself forward to run for office or be on a board or become an executive when you are liable to get treated in such an appalling fashion? 

However, it's not only the victims of bullying who lose in these circumstances; the organisations and institutions that do nothing to fix their cultures will ultimately lose out. That's because people who are bullied, including many talented people, both male and female, will simply choose to work elsewhere, for an organisation with a healthy culture that calls out and eradicates bad behaviour. 

Quite simply, organisations that offer a safe and respectful environment will better be able to attract talent, while those that ignore their duty of care will lose out in the recruitment and retainment stakes. Good talent is a valuable asset. Organisations that can't attract that talent because they have a workplace environment and culture with a poor reputation will suffer. They won't attract women, or anyone else for that matter, who wants to enjoy their work.

Organisations that look after their staff will have the edge over those that don't; especially if they're interested in attracting smart women who don't want to put up with the rubbish that still goes on in too many workplaces in regards to bullying, intimidation, and harassment. Call it market forces or just plain decency, but the days of bully culture are numbered.

 

All care, no dare? The modern business-woman’s dilemma

Tuesday, October 02, 2018

A new Pew Research Center survey has delivered a big vote of confidence for female corporate leaders, with women scoring substantially higher than men on five out of seven categories of leadership.

On each of the categories, 49% to 66% of respondents said there was no difference in leadership qualities between men and women. However, among the other half of the respondents, the view was that women could be better trusted to achieve positive results in areas related to social and cultural outcomes like diversity and safety. Tellingly, though, men scored far higher in the categories related to risk and deal-making.

The survey shows a stark difference in how many people view the capabilities and qualities of male and female leaders. The traditional idea persists of women as nurturing and inclusive and men as driven and deal-focused. It's both a blessing and a curse for women leaders, especially those who want to be recognised as accomplished businesswomen in their own right, capable of negotiating the toughest of deals with the best of them. 

The results of the survey reinforce a set of gender stereotypes that hold women back in certain areas of business, such as accessing finance at the startup level, but also serve other women well, particularly in corporate environments that have moved to embrace triple bottom line ideas around social diversity and responsible corporate behaviour.

The categories of “negotiating profitable deals” and “being willing to take risks” are precisely the ones most commonly cited by the likes of venture capitalists as reasons why female-led startups struggle to get funding. 

A Swedish study examining the attitudes funding decision-makers like venture capitalists have about male and female entrepreneurs noted men were almost unanimously viewed as risk-takers and more likely to be interested in rapidly scaling companies than women. 

Some of the comments from participants in the study included:

“She is very cautious, as women often are, and she is careful in what she does, and she does not dare to invest.”

“It’s a fact that women are more cautious in their investments.”

“She is a typical woman: extremely risk-averse.”

However, the stereotypical attitudes of funding decision-makers did not correlate to the business outcomes measured in the study — the gender stereotypes were essentially wrong:

“Our research shows that VCs clearly evaluate entrepreneurs differently when it comes to gender. Because of this, female entrepreneurs may face difficulties in gaining credibility because different standards are used to evaluate their performance. At the same time, these beliefs have no basis in fact.”

It's great women are increasingly being seen as competent managers, as borne out by the results of the Pew Research. However, the managerial qualities highlighted in the survey also continue to show the areas in which women experience an unfair bias. There's still a lot left to disprove for female entrepreneurs and women in business who want their deal-making acumen acknowledged rather than their abilities to foster and nurture caring corporate environments. 

 

No place for 'boring' retailers

Monday, September 24, 2018

Former Myer CEO Bernie Brookes came out earlier this week with scathing commentary on Australia’s retail sector, saying most retailers were doing a poor job at exciting and enticing customers into their stores.

“You still walk into department stores and discount department stores … [in Australia] and they’re as boring as batsh*t, they really are,” he told attendees at a retail conference seminar in Melbourne.

Brookes, who was at the helm of Myer for nearly a decade before he stepped down in 2015, said too many retailers seemed to be content with wishy-washy offerings. “At the moment they’re all fighting in the same space, but none of them have a point of difference,” he told SmartCompany.

Brookes is certainly not alone in his assessment that Australian retailers can be a little on the staid side. Last year, an analyst for investment bank Citi went as far as to call the fashion lines he was seeing in stores dull.

“In our view, winter sales are weak because fashion trends are hardly different to last year and lack enticing colours. It’s all about black, khaki, pale pink and leopard print (yet again),” the fashionista analyst said.

And it’s to a very large degree true. The Australian shopping experience, especially when it comes to department stores and even retail fashion, is not terribly exciting. It definitely lacks the wow factor people want when they go shopping.

Brookes suggested retailers need to up the ante on experiential shopping, citing overseas retailers like Macy’s and Selfridges as examples to follow.

Another thing Australian retailers are still struggling with, and which Brookes himself never really succeeded at in his time at Myer, is integrating digital and bricks-and-mortar to create a seamless and modern shopping experience for customers.

This is still something with which retailers the world over, not just Australian ones, are coming to grips. Traditional retailers, especially department stores, have been under massive pressure to protect their patch and profits as online retailers have muscled in on margins. In many cases, and perhaps understandably, that has led to conservative retail strategies that have sought to emphasis discount retailing instead of premium brand strategies.

Traditional retailers were always going to struggle to outrun the likes of Amazon, or even British online fashion retailer Asos, on price. The one thing they have in their arsenal is the in-store experience, or ‘experiential’ retail as Brookes calls it. The trick for smart retailers has been to work out how they leverage their bricks-and-mortar with clever digital options. Australian retailers are not really there yet.

US department store Nordstrom has been cited as one department store that is working with some success towards a better integration of digital and physical elements in its strategy, creating what some in the retail industry call an omnichannel strategy.

The reality is that shoppers are now totally at ease with using their smartphones to price shop on the spot and research items as they browse in-store. They want to be able to order online and pick up at their convenience. They want some colour and fun when they walk into a store too.

If Australian retailers don’t want to be “boring as batsh*t”, they will have to work on integrating digital and physical, as well as bringing some life back into their stores.

 

The rise and rise of Instagram

Wednesday, September 19, 2018

Facebook has had a miserable past year or two. Mark Zuckerberg no longer looks like the sprightly Harvard dropout genius who created a billion-dollar company and game-changing platform. He looks worn down, worried, and like he wants to be somewhere else. 

He looks like the guy who wants to be living the Instagrammable life but is stuck in the worst sort of neverending Facebook news feed scroll. 

Because while Facebook has had to fight allegations that it is simultaneously destroying democracy and making people depressed, its pretty younger counterpart Instagram is flitting about from 5-star restaurants to movie premieres hobnobbing with celebrities and the beautiful people. 

Yes, there are no doubt social ills connected to the Instagram phenomenon too. However, the magnitude of those issues seems far less grave than what is confronting Mark Zuckerberg at Facebook. 

Compare these two recent headlines and you quickly get an idea of the challenges facing each platform:

  • “After Russia was accused of using memes and viral images to influence elections, Facebook will now fact-check pictures and videos”
  • “5 influencer tips for taking the perfect food photo for Instagram”

The other thing is that Instagram is a business still on the rise, whereas Facebook's growth trajectory is starting to level out. It is the mega platform of social media, with 2.23 billion monthly active users as of the second quarter of 2018, but user acquisition has got that much harder, while user retention has become a significant concern.

According to an analysis by Recode, Facebook added 22 million new monthly active users for 2018 Q2, its lowest quarter-over-quarter rise since at least early 2011 for that all-important growth metric. Growth in the US and Canada has been stagnant now for the past year, while user numbers have dropped a little in Europe.

Contrast that to Instagram, which is Facebook’s sister site after having been acquired by Facebook for around $US1 billion in 2012. Instagram hit a billion monthly active users in June 2018, doubling the number of people using the site since June 2016. 

Not only is it growing quickly, but it has also become the darling of advertisers, who see it as a perfect fit for marketing and selling to consumers. Mired in all of its other issues, Facebook continues to have trouble convincing advertisers its an effective sales platform. 

Facebook's gargantuan size is its main attraction. Much like the Yellow Pages of yesteryear, businesses and advertisers believe they have to be on Facebook because it is so dominant. However, that does not mean they think it's necessarily effective. 

In the case of Instagram, advertisers want to use the site because it connects very directly to the aspirational nature of consumers. It boils down to the fact we mostly show off in pictures (Instagram), while we rant and complain in words (Facebook).  

Facebook is not going anywhere anytime soon. However, Facebook as a company is looking increasingly towards Instagram for growth and advertising revenue. Mark Zuckerberg will be hoping Russian bots don't start using Instagram food photos to influence elections. He'll be in real trouble then.

 

A picture's worth 1000 words

Wednesday, September 12, 2018

“Seeing comes before words. The child looks and recognises before it can speak.” Those are the first words in art critic John Berger’s book Ways of Seeing. We see the power of images in our world every day, so it makes a lot of sense that significant amounts of smart money in advertising and marketing is being spent on visual recognition technologies. 

Think about your recollection of famous people and world events; an associated image is the most common thing that springs to mind. Most of us probably see Marilyn Monroe in that iconic white dress before we even think of the name of the movie that image comes from: ‘The Seven Year Itch.' It's why companies spend billions of dollars a year meticulously pimping and preening their brand image, from their merchandising collateral, through to staff uniforms and brand logos. 

AI drives visual recognition software. The software can identify and categorise images, still and video, in a way that will increasingly come to resemble what we have now with the text-based internet search engines. It's the next step away from the internet as we currently know it to a far more all-encompassing thing that will include even more data from images, as well as the Internet of Things devices.  

At an elementary level, you will be able to watch a video, let's say a clip of Marilyn Monroe in The Seven Year Itch, and then search the images in the clip, like the famous white dress, and immediately receive information on where you can buy that dress, for example.  

As consumers, we respond instinctively to the images we see. That's why social media platforms like Instagram, Pinterest and Snapchat are so beloved by marketers. All three platforms are dominated by visual imagery. According to one statistic, something like 95 million photos and videos are shared on Instagram a day, and over 40 billion photos and videos have been posted on Instagram since it started. The other two major visual social media platforms would register similar types of numbers. 

Generally, images speak in a more direct, less ambiguous way to consumers than words. Get the image right, and it’s a direct hit to the visual cortex of the consumer, which marketers hope means a direct line to the consumer’s credit card.

The likes of IBM, Google and Facebook (which owns Instagram) are all working on applying artificial intelligence to visual recognition software as part of the broader push into computer vision. Because so much shopping involves visual browsing on the internet, at least as part of the initial research phase, visual recognition technology is seen as a massively valuable potential tool that marketers can use to hook in consumers at the earliest stage of the buying process.  

Another driving force in the rise of visual recognition technologies and the general importance of visual imagery is that commerce has been globalised. English might still be regarded as the international language of business, but that’s being challenged by Chinese, as well as Arabic and Spanish in other parts of the world. However, visual communication to a large extent crosses these boundaries. A LOL emoji, like McDonald’s golden arches, is recognised and easily comprehended the world over. It’s significant that 80% of Instagram’s users, for example, are from outside of the US. 

The complex business of business will still require the technical nuances of the written word, but more and more the business of selling things will rely on the power of visuals.

 

MORE ARTICLES

Tech - can it make aged care sexy?

Could cryptocurrency save Facebook?