5 Strategies for Profitable Brand-Retailer Partnerships

 In Blog

We recently held a webinar that took a deep dive into the complicated partnership between brands and retailers within the eCommerce space. However, the partnership doesn’t have to be complex. Today, brands and retailers are discovering creative ways to benefit from opportunities. Below is a transcription of our webinar,  5 Strategies for Profitable Brand-Retailer Partnerships: A Matchmakers Guide.

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Brittany Sudlow: (00:05)
Hi everyone, and thanks for joining today’s webinar presented by Jumpshot. In today’s webinar, we’re going to be talking about the five strategies for profitable brand retailer partnerships, a matchmaker’s guide. Before I introduce our panelists today, I’ll quickly go over a few housekeeping items for today’s webinar. All audience participants have joined the webinar in listen-only mode. We will have a Q&A session at the end of the webinar. So please use the chat feature on the right-hand side to ask any questions as they come up. If we don’t have time to answer your questions during the live webinar, a member of our team member will respond to you within the next 24 hours. And lastly, we’ll be sending out a recording of today’s webinar to all attendees.

Brittany Sudlow: (00:47)
All right, let’s get started. I think we’re going to have a great panel today. We’ve got a bunch of people who love data, consumer stories and having fun while geeking out on numbers. So, we’re lucky enough to have both Steve’s today. We’ve got Steve Levay, our Communications Manager, who’s always on top of what’s going on in media, what breaking news stories are happening and really digging into the data behind that and kind of what led to that decision, what happened after post-mortem. We also have Steve Kraus, who is our Head of Digital Insights. He has decades of experience analyzing data from every consumer angle thinkable. He has a background in psychology, so he really puts on that hat when evaluating numbers and it makes it a little more personable. Plus, I hear he has a killer bill Clinton impression that he debuted in one of our previous webinars called Google Uncensored, so be sure to check that out. And then there is me, my name is Brittany. I think my title says it all, all-around bad-ass. But really, I’m the Product Marketing Manager. I’m super humbled to be here with both Steve’s who are truly experts in data analysis and hopefully I can bring a little bit of that consumer angle to today’s webinar.

Dr. Steve Kraus: (02:08)
Thanks Britney. I’m Steve Kraus. I’m just going to start off with just a couple of slides to give you a little bit of background on Jumpshot and who we are and in particular talk about our data and where it comes from because so much of what we’re going to talk about today really builds on our data. We’re a startup company founded back in 2015 with about 200 employees. We’ve got offices in several cities around the world and we are headquartered right here in San Francisco. And the data that we’re going to share with you today come from our panel of devices that’s about 100 million devices around the world on which we’re able to follow the clickstream of what happens on those devices. So, it’s an extremely large panel and today we will focus on results from the U.S. And, as you can imagine, the data that we get really reflects consumer digital behavior in a very deep and granular way.

Dr. Steve Kraus: (02:59)
But when, when we started with it, it’s very big – it’s very unstructured. So we actually do a tremendous amount of work both in machine learning and human coding, really to try to understand what’s going on, on specific websites, on specific marketplaces, to be able to take a raw series of clicks and understand, what was, a click-through on a search engine results page and understand what was a conversion. So, we can look at, literally hundreds of thousands over a million brands across thousands of websites. And I really think our data does two things really well. This one gives you full visibility around the internet, including transactions across all different marketplaces, what’s going on behind walled gardens. So, we give you visibility to digital behavior that sometimes hard to see and then we also have the full path-to-purchase and we’ll untangle some of that today as we go along.

Brittany Sudlow: (03:53)
All right. These are some of Jumpshot’s customers here. The reason we put this up is just to kind of show you guys, we work with both brands and retailers. We work with market research companies. So, we really have a full understanding of kind of what the category landscape looks like, what successful brands have looked for in their retail partners and vice versa. And so we’ve kind of taken some of those stories in the data, in our personal experiences, and really put them into this webinar today.

Dr. Steve Kraus: (04:24)
So today we’re talking about brands and retailers and I always kind of think of brands and retailers as, as frenemies. I mean there’s certainly not competitors in the traditional sense. They obviously need each other. Brands need distribution. Retailers need things to sell, so they’ve got to work with each other obviously, but there is always a bit of tension there because they’re playing a zero-sum game and they’re going after the same pool of consumer dollars. So there has always been a bit of tension. Obviously, retailers tend to have a stronger connection to the consumer because they’re handling the transaction. And as a result of that, they also have a lot of the customer data that’s so crucially important. And for as long as there have been brands and retailers, brands have often said, “Oh, we get checks but not information from the retailers.” And that lack of information is, is one of the points of tension in the relationship. And so we’ll talk about that as we go along as well.

Dr. Steve Kraus: (05:23)
So when we talk about a brand, retailer partnerships, well let’s start at the top and obviously a lot of aspects of the digital world are winner take all economies where you’ve got big dominating giants. So, let’s start with Amazon and Google. And obviously, over the past few years, Amazon has been transitioning from being a pure retailer to also creating brands. First with the great emphasis on private labels, on its own AmazonBasics brand. But just within the past year or so, there’s been a significant pivot by Amazon away from private label brands per se and toward exclusive brand relationships. And often these are with existing brands that offer to create a new product line, for example, specifically for Amazon customers or for Prime members. And I think this really reflects the point of view from Amazon that really brands continue to be important. They continue to strongly resonate with consumers. So we see the pivot there from private label to exclusive brand relationships.

Dr. Steve Kraus: (06:22)
On the Google point of view, well, we just did a whole webinar with Rand Fishkin and some other real SEO guru is all about search. I encourage you to check it out, but one of the things that we saw there was clearly Google looking to move beyond just their core search expertise to capture more of the funnel, including lower funnel product-oriented search that Amazon has become very strong in, but also to be more directly involved with transactions themselves. So, you’ve seen Google come up with innovations like a universal shopping cart that can be used across different sites and low and behold, new relationships between Google and a whole slew of different well-known brands. Again, reflecting the notion that brands continue to really resonate in consumers’ minds, but also reflecting a whole new world of brand retailer partnerships. So we see it here with Amazon and Google and we’ll see it as we look throughout the eCommerce landscape.

Dr. Steve Kraus: (07:22)
Now, it’s interesting that while Amazon, as we’ve seen, has really been dialing down a little bit, their private labels, but gearing up their exclusive brands, you’ve seen throughout the marketplace, a lot of interesting brand retailer relationships. And Target really stands out as one that’s really been very innovative working with a lot of brands that were originally direct to consumer brands (DTC). So you see kind of a real innovation on both sides of Target being open to working with these kinds of brands, just these kinds of brands, saying, there’s going to be a limit to how far we can go with a straight direct to consumer model. We need retailer partners to take us that next step in terms of distribution. So certainly, Target has been a leader, but it’s not just Target. There have been a number of recent examples that have made the headlines, as you see there on the slides about innovative new partnerships between retailers and brands.

Dr. Steve Kraus: (08:18)
So, with that as background, let’s jump right into it. We’re gonna talk about five principles for effective partnerships between brands and retailers. And we’ll examine these principles from both the brand and retailer perspective. We’re going to start off talking about how to map the eCommerce landscape in a really effective and deep-dive kind of way. And then we’ll talk about finding the rocket ships, the traffic masters, the promotional experts, and then finding the right affinities. How do you find the right personality fit between brands and retailers, so it really resonates with consumers? Okay, so let’s start with how do you map the eCommerce landscape in a way that really gives you the information that you’re going to need. And as I said, one of the things that’s really great about our data is it gives us full visibility into transactions across all the different marketplaces. And that’s really the place where any brand should start.

Dr. Steve Kraus: (09:11)
So, let’s just start with an example of Nike. So, the first thing that you do in mapping the landscape is to understand all of the places where your product is being sold. And you may just think that, well, you know, every brand must know every place their, their brand is being sold at. In fact, that’s often not the case. And when we work with clients and start off with this kind of landscape mapping process, they’re often surprised to find some of the outlets of their products are being offered. Often wholesalers and resellers are selling products or channels they’re not even aware of. So here we’re just looking at a conversion rate on the horizontal access. The average product price on the vertical axis and the size of the circle reflects the number of transactions. Now, Nike is an interesting case where they’ve got actually a significant amount of their sales happening on their branded site and you see as that say a low converting but high price and a very large segment of the population.

Dr. Steve Kraus: (10:10)
If you look out kind of more on the lower right, you see amazon.com, a much faster converting, but at a lower price. Uh, you know, Nike famously made headlines a couple of years ago when they announced they were going to start selling directly on Amazon. That was actually part of a larger initiative where they wanted to sell more directly to consumers and they’ve got the brand strength where they can, you know, in a sense drive their biggest fans to their branded site who will then pay flagship margins for their flagship products. But it’s only by starting off with this full picture of the landscape that you can as a brand really start to evaluate where am I selling, where am I selling most effectively? And then most importantly, how do you look at this from a competitive point of view and then reverse engineer your competitor’s success. So that, you’re then able to think about what are some retail partnerships that might add to my bottom line.

Brittany Sudlow: (11:07)
Awesome. Steve. Um, it’s not just about looking at where you’re selling on retailers, but also who are your competitors, you know, brand-101. What we’ve found is that actually is that you can’t just rely on the antiquated marketshare, because just because Nike is number one doesn’t mean it’s the number one competitor for every shoe brand. So, here’s an example of, of Saucony is using insights, our on-demand platform at here at Jumpshot, you’re able to see when people considered multiple brands of shoes, who do they actually end up purchasing if they didn’t purchase your brand. So, in this case, Saucony and we found that ASICS, New Balance and Adidas are all purchased more frequently than Nike after someone considered a Saucony shoe. So just shows you that, that the journey is complex. People are browsing across multiple retailers, but they’re also browsing multiple brands. There’s a lot going into it, you know, delivery, price, color, everything. So, it’s critical to look at it from all these different angles, not just retail partners, but competitors. And this may honestly vary across marketplaces. So maybe ASICS isn’t their top competitor on Amazon, but it is on a Zappos or something like that. So just another angle that to look into and consider.

Steve Levay: (12:26)
Hey everybody, this is Steve Levay, I realized that I haven’t spoken in about, you know, 13 slides. So, let me introduce myself again. Hello. We talked a little bit about mapping the landscape for specific brands for specific categories for where your products are sold. But we also need to think about that map evolving over time. And you know, eCommerce is huge. It’s a, it’s something like 12% of all retail sales in the US now, but that is shifting depending on where you are in the landscape. So we’re going to look at some of the big trends to see who’s going fast.

Steve Levay: (13:01)
So if you take a look at the broad retail landscape, we’ve done it hereby, by plotting some major retailers by the number of transactions that you drive. So, on the left side, on that Y-axis, you’ll be billions of transactions. And on the X-axis, that’s how efficient they are at driving those conversions. So, it’s conversion rate. And it should be no surprise to anybody that Amazon is in a class by itself. Their conversion rate is far higher than anybody else, nearly 80%. So, at 8% of all the shoppers that come to their site end up making a purchase, which is just about crazy and incredible and nobody else touches them. Um, and it should be no surprise that they’re bigger than everybody else too. 1.5 billion transactions in 2018 and that number is up 34 million from where it was in 2017. That growth alone would put them at about the fourth biggest retailer in the US online. And that’s just staggering to me. But you know, everybody sells lots of different places as we’ve already covered. And places like Walmart are also growing and they’re growing faster than Amazon is. So, Amazon, the clear leader, but there’s a lot of growth happening, and a lot of that growth happened where all those black dots are near the bottom of the X-axis. Right? So the next slide is going to go into those retailers a little bit.

Steve Levay: (14:09)
So here we’re plotting all those black dots in a slightly different way. So instead of the bottom access being the conversion rate, we’re plotting the change from 2017 to 2018. So, on the right side you’ll see all these retailers that were growing. On the left side, you’ll see all of these retailers who are shrinking somewhat. So off far to the left, you’ll see jet.com dropping almost 60% year-over-year. And on the right side you’ll see brands like or retailers like Target and Chewy and Wayfair who are growing at a remarkable rate. Chewy and Wayfair are really interesting to me, their niche players, right? Chewy just sells pet food. And they’re finding a way to thrive. And we’ll talk about that in a little bit, but retailers like Wayfair just selling furniture, home decor, also showing a huge amount of growth and but also you have established retailers who are brick and mortar dominators like Target and Home Depot and Nicole’s, all of whom are making major investments into their eCommerce to try to grow transactions and seeing a lot of success.

Steve Levay: (15:06)
I mentioned that 30 million growth, that Amazon showed last year, that Target is just about there, not in terms of growth but in terms of overall volume, but they’re growing at a huge amount and a lot of these brands, you know they have existing private labels like Steve K. talked about a little bit earlier, but they’re also looking for partners and they’re also thinking about ways to keep growing that business to keep accelerating that business. So you should be aware of the ones that are thriving doing that if you’re a brand looking for our retail partner.

Steve Levay: (15:37)
So, in this case, we’re looking at a very specific category. This is just in the skincare category of what we call in our category structure, the beauty category. And if you look at three retailers, Amazon would be the dominator here, they are still around 70% marketshare, but that’s down from 80% a year ago. And that decline in marketshare isn’t about selling less, it’s about other retailers selling more and more. So, a huge part of that growth has come from Walmart and around 30% year-over-year and Target around 45% year-over-year just in Q1 2019 against Q1 2018. That growth matters if you’re a brand, whether you sell with Target or Walmart now or not, and it’s distinct from growth. We’ve seen from a retailer like Sephora who surges in the holiday shopping months of Q4. So, in this, in this line graph, you’ll see those Q4 dates, you’ll see big spikes, right?

Steve Levay: (16:25)
As people are buying a lot of stuff, buying a lot of products for the holiday shopping season, you don’t see those same spikes for Walmart and Target. It’s much more steady everyday growth. Jumpshot data shows that some of its overall growth in the skincare sector comes from consumers who view products on Amazon or Sephora, but then ultimately buy on Target or Walmart. And even more comes from those who shop exclusively on Target and Walmart and don’t even consider other domains. So, getting skincare products onto Walmart and Target digital shelves is really a good idea. Even if you still have products at Sephora, you need to have inventories in other places as well because consumers are going to showroom digitally on Sephora. They’re going to compare different brands, different reviews, different ratings, and then they’re going to buy where they can get the cheapest price.

Brittany Sudlow: (17:15)
Awesome. Thanks, Steve. I guess we’ll now transition over to find the traffic masters.

Steve Levay: (17:23)
Yeah, so one of those private masters from a retailer’s perspective is Chewy, I mentioned them earlier. Pet food giant. And the pet food category is really fascinating. It’s a place where there’s been a real challenger to Amazon’s general dominance. Chewy.com, their stock prices have been surging after their IPO earlier in the month. There’ve been neck and neck with Amazon for years in terms of overall transactions in the category, but the strategy for that success is actually fairly different from Amazon’s. If you look at just one brand, say Blue Buffalo dog food. The transaction volumes are really similar on the, on the chart on the left side, that that right-hand bar though, that conversion level that they’re just about the same, about 300,000 for the year so far. But the product views for Blue Buffalo are radically different. You look at that left-hand bar, double, right? 2 million views, twice as many as Amazon this year.

Steve Levay: (18:12)
And a huge portion of that traffic, those 2 million views, it comes from paid search. 83% of Chewy search traffic comes from paid sources. Just over half of Amazon search traffic as paid and that’s not an accident. Chewy is running a massive CPC, cost per click, campaign on Google to drive that traffic. If you search for any, almost any brand of dog food, I’ve done Blue Buffalo here, for Google, the leading paid results are all for chewy.com pet product listings. And in this case, it’s the retailer who’s really driving that. Chewy will ask its brand partners to fund campaigns for their brands, which Chewy will then leverage and manage providing essentially guarantees for sales in exchange for brands making that sale. So, brands get a win and they get a competent, custodian of their campaign and Chewy gets a win because they get a lot more traffic to their site.

Steve Levay: (19:05)
They get our reputation for the place for people to become loyalists. And by specializing in just one category, in pet food and supplies, they’ve really been able to pay dividends. And looking at a slightly different category, actually a much different categories. This is a very specialized skincare product, skin serums, if you look at all marketplaces, the number one skin serum brand, I think might actually be eye serum, but it does not matter. It’s TruSkin Naturals. They drove about 100,000 transactions from January to May in 2019 far higher than any other brand, especially these established brands like Clinique. And what happened for that is that that traffic is very, very loyal. Part of what drives that, that category leadership is the fact that the people who come to interact, to come to buy this brand, only view TruSkin. 90% of all the interactions for TruSkin only look at that one brand in a shopping session they’ll never look at any other brand. Only 10% are looking at other brands and all of the shopping occurred directly on Amazon, which signals that another retailer might be able to capitalize on this brand affinity by partnering with the brand saying, “Hey, come sell it through us. We’ll, we’ll help you out in some capacity.” It’s right for diversification of sales.

Brittany Sudlow: (20:26)
Awesome. So cool to look at how these brands are building loyalty themselves, but a different angle you need to look at it as also how are they driving traffic? So, you saw Chewy does a lot of paid advertising. Kind of on the flip side, TruSkin is going with a different approach. As you can see in this bar chart, traditionally we see a lot of traffic driving through search engines like Google, Amazon search. But TruSkin has its own kind of following and they’re building traffic in a different way. If you look on the right side, that’s kind of a breakout of what’s in that “Other” traffic bar. There’s a lot of stuff from, from content, areas like Buzzfeed or Real Simple, YouTube, and, social channels like Facebook. And so it’s a lot of others like they’re building brand awareness and credibility in a community of loyalists on all these other sites and rather than focusing on traditional search.

Steve Levay: (21:19)
Yeah, that’s so true. They’re also leveraging like Ebates, so re-couponing sites, affiliate marketing, and they’re also getting traffic from their own domain to Amazon. So, people go to trueskinnaturals.com, maybe they read a review on, you know, Real Simple or Baffler or whatever. And then they get that, what’s that brand? They Googled TruSkin. They went to trueskinnaturals.com, they read a little bit more about the product, but they can’t buy on trueskinnaturals.com, they go back to Amazon. So driving their own traffic to the retailer trueskinnaturals.com they’re seeing the success.

Brittany Sudlow: (21:46)
It’s really interesting approach that they chose not to distribute themselves at all and they just went with Amazon, that’s the only place you can buy TruSkin, right?

Steve Levay: (21:54)
Yes. It’s remarkable in fact.

Brittany Sudlow: (21:54)
Awesome. Cool. Shifting gears, I think we’re going to kick it back over to Steve Kraus.

Dr. Steve Kraus: (22:02)
Awesome. And I love this slice, like the two young influencers, but there’s nothing on their screens to implement. So as we talk about who’s really good at promotion, you know, we start to look at the ebbs and flows in traffic over time and who’s really able to create, you know, through their promotional efforts, a real flow of traffic. And so, Amazon obviously stands out, you know, historically, so much of retail activity happened around the holidays and you certainly see those spikes there when we look at Amazon’s transactions over time. You know, if you remember back to the original origin of the phrase Black Friday, well that was when retailers became profitable for the year and obviously no one would ideally want their business to be that way. No one would want to operate, you know, in debt essentially for the first 11 months of the year and then make it all up in the last five, six weeks of the year.

Dr. Steve Kraus: (22:58)
So, for a long time, brands and retailers have been trying to figure out how do they even out that demand and Amazon has really stood out with the creation of Prime Day and one of several retail holidays that are out there now. But if you look at that spike for Prime Day, you see how it really is remarkable and they’re able to drive and amount of traffic that normally they’re not seeing outside of that holiday boost. Now the thing that I would encourage brands to think about is that yeah, Amazon sells a whole lot at Prime Day. They also, in particular, sell a whole lot of Amazon stuff on Prime Day. And as we look at in our Jumpshot data, the most popular products on Prime Day, it’s a lot of Amazon products. It’s, it’s Echo, it’s Firesticks, it’s things like that. So, uh, certainly, you know, Amazon has enough power that Prime Day sort of drives a, a ripple throughout the eCommerce marketplace and other brand and retail sites, do see a boost around Prime Day, so you may want to be selective and understanding how are you going to leverage this if Amazon’s focused really more on their own products, maybe as a brand, do you need a retailer that would, again, have more of a partnership with you and helping you to leverage this kind of promotional holiday?

Steve Levay: (24:12)
Yeah, that’s so true Steve. I mean like one retailer that’s really learned that Prime Day lesson is Wayfair, as I may have mentioned before, and when they have their own promotional day, they call it Way Day in April, they also see this huge impact on the market. You can see, this is just marketshare in terms of number of transactions by retailer in the furniture category, and on Way Day last year, you see this massive shift in marketshare. Wayfair briefly overtakes Amazon and they’re not even in the second place position, most of the time they’re third place in furniture transactions from Walmart. So on one day you see a major dip in Amazon and a major boost for Wayfair because they’ve taken that success space and growing that identity as a furniture provider and turned it into a massive opportunity for promotion.

Steve Levay: (25:03)
And you know, it’s not just retailer driven promotions that are important. Black Friday still is a really important holiday and you see giant boosts for most retailers on that holiday. But you need to find the retailers that do it in the right way, the right approach, the right strategy of shifting every year a little bit. Um, and if you look at the difference between 2017 and 2018 transactions, Black Friday this last year with like a really big surge, it was a really good retail day. Walmart and Target and Kohl’s all saw double-digit percentage wise growth. But one retailer we didn’t, and this is I think just in the electronics category we’re looking at is Best Buy. They actually saw a decline year-over-year and the number of transactions that happen on Black Friday. And one reason for that is that they didn’t offer standard free two-day shipping on purchases that were made, this is something consumers are looking for.

Steve Levay: (25:52)
Amazon has had a huge impact on the market with Prime membership, right? People come to expect to get their products really quick online and if they don’t, they’re not going to purchase it from you. Um, there were also some complaints that Best Buy wasn’t operating the right kind of discounts for its client base. There weren’t particularly exciting this year on all the things that people wanted and so they looked elsewhere, and other people reap the benefit. So if you’re a brand and you’re thinking about your retail partners, maybe you take an inventory away from Best Buy on that day, maybe you think about somebody else who’s keeping up with the trends.

Dr. Steve Kraus: (26:24)
That’s a great example. Again, as a brand, you’ve got to find the retail partners that have the right juice, that can really drive traffic and conversions. And that’s not going to be every retailer that’s out there on every holiday.

Steve Levay: (26:33)
Yeah. You need retailers that can literally deliver.

Brittany Sudlow: (26:38)
Great. I guess we’ll shift to the last and final topic of Finding the Affinities. The finish line is in sight.

Dr. Steve Kraus: (26:46)

All right. I love it. Hitting the finish line. And when we talk about finding the affinities, one of the ways we can do this is to think of brands and retailers as having distinct personalities and then trying to find personalities that go well together. And because we have a very comprehensive perspective on what it is that consumers are doing in the digital world, we’re able to look at correlations across categories and that really helps us build a very deep understanding of who might be shopping for a particular brand or retailer. So here I’ve just chosen, uh, three, uh, sort of these hot new DTC kinds of brands, all three of which have actually, then developed partnerships, in the first case reformation with Nordstrom and then Quip and Casper with a Target.

Dr. Steve Kraus: (27:32)
And you can see again here just looking from the brand point of view that they have a distinctive, age skews, gender skews. Uh, we’re also able to look at what are the top publication skews as you were looking to kind of go upstream and find what kind of media would influence the sort of people who are interested in certain brands. You can look at the streaming genera’s and I just done this year at a very high level. We can actually do this at a very granular level. So, we could tell you for people who bought a particular brand, here are the specific TV shows that they want to watch. Here are the musical artists I like to listen to on Spotify. Here are the other brands that they tend to buy in other categories. So you can really build a very deep, rich, multidimensional understanding of brands and retailers through this kind of information.

Steve Levay: (28:22)
That’s so true, Steve. I find that affinity stuff really fascinating, especially when you uncover affinities that you might not expect. So, and this happened recently with a partnership between the retailer Target and the brand Vineyard Vines, not necessarily a partnership you might anticipate. We actually had; we were laughing earlier because people in the office didn’t know what Vineyard Vines was. I had this experience growing up on the East coast, it’s very preppy brand, lots of like whales and it’s, you know, Martha’s Vineyard specific lots, very bright colors. Anyway, not necessarily the target group for Target that you might think about so to speak. Um, but you know, after they had a partnership, you see, Target becomes the number one transaction- uh, number one retailer for transactions of Vineyard Vines clothing in across the internet except for vineyardvines.com for a brief period. And you know, you see this decline afterwards, partly because they sold out of a lot of that clothing.

Steve Levay: (29:14)
Um, you know, other sites are often in this sort of gray market as Steve Kraus was talking about a little earlier- third-party wholesalers, it’s kind of thing, um, resellers. Uh, but you see a really interesting thing happen. So, Target gets a lot of traffic as a result of the partnership. They get a lot of sales, which is good for Target, but, what else happens? They see an interaction. So, among, women’s clothing shoppers, the ones that interacted with Vineyard Vines also interacted with Target’s private label. So, A New Day, Universal, Thread, Exhilaration; what, who, who, what, where all these brands on uptick in views after that Vineyard Vines partnership they would not have seen otherwise. So, it’s a real win-win situation. Vineyard Vines gets a new place to sell new clothing, tapped into a new group of buyers to sell to and Target gets not only a bunch of sales through their Vineyard Vines partnership, not only a bunch of physical foot traffic to their domain, but they also get traffic that goes directly to the private labels that they want to sell to.

Dr. Steve Kraus: (30:15)
Yeah, Target really stands out to me as one of the most innovative retailers out there. We know, we saw earlier how they’re partnering up with some of these formally exclusive D2C brands like, like Quip and Casper. And here you see them partnering with an existing brand and doing in a way that probably brings in new customers and also drive traffic to their own private labels to be really, really effective.

Steve Levay: (30:38)
Yeah, I think they’ve been really innovative with omnichannel as well. So, trying to get more in-store pickup going, which is a real boom for brands that are stocking their physical shelves. Lots of retailers that have that established brick and mortar presence; Kohl’s comes to mind with their partnership with Amazon, actually a retailer partnership that has brought a lot of foot traffic into their business as a result of eCommerce behavior.

Brittany Sudlow: (31:01)

Target was one that recently announced one-day shipping, right?

Steve Levay: (31:04)

I think that’s right. I mean Amazon announced it for some of their customers but Target and trying to match. So we talked earlier about Best Buy failing to keep up with, with logistical concerns as a huge driver of consumer interest and yet other retailers like Target are going to try to like get on that really quick.

Dr. Steve Kraus: (31:20)
Well, I’m going to wrap it up with a few final thoughts and as I put this slide together, I thought how could I combine some takeaways with some egregious copyright violation? So that’s when I put in the quote from a Little finger from Game of Thrones there. But I thought it was really, really telling that I thought this quote was great when he says, you know, “chaos isn’t a pit, chaos is a ladder” and if you look at the impact that Amazon has had in eCommerce, you see a lot of good buzz out there in the popular press about, Oh, “Amazon’s taking over. It’s all over. That’s the future.” And in fact, we’ve seen all these examples of other retailers that are thriving of all of the all of the innovation that’s going on and the partnerships between brands and retailers. Uh, we’ve seen that the growth of, of Chewy and Wayfair in categories, or maybe Amazon was a little bit weaker. So I do think there is a lot of opportunity out there in the marketplace, even though Amazon, honestly Google have very strong positions in what they do.

Steve Levay: (32:16)
That’s really true. I think it’s really interesting. I mean Amazon gets dinged a lot for being sort of a monopolistic, but it’s not really, and we can see the fact that other retailers are coming in to innovate where there’s room to and seeing a lot of growth.

Dr. Steve Kraus: (32:31)
Yeah, it’s a, it’s been really interesting. I just got back from the London where we did an event and it was a very similar kind of takeaway over there where Amazon is not quite as strong in the UK, and you certainly see, you know, in certain categories, you know, that they say over there, “Oh, you know, the high-street is dying”, meaning retail stores over there. But in fact, there’s a, there’s a tremendous amount of opportunity, particularly in some of these categories where Amazon is not as strong. Which actually leads me to my next takeaway. You got to know in what categories is Amazon very, very strong and not as strong. And so it really requires the kind of data that we have not so subtle plug for our data, but to be able to look at transactions across marketplaces and throughout the path to purchase is really, really crucial.

Dr. Steve Kraus: (33:11)
Uh, we’ve seen examples with direct to consumer brands realizing, “okay, we’re going have to innovate. We’re going to have to try some new things. We can’t just stick to a given model and assume that we’re going to get the kind of brand awareness and penetration in the marketplace that we want.” And then we talked a lot about finding good fits, whether it’s looking at the persona profiles or if it’s simply looking at growth. And there are a lot of different ways to look at growth, whether you know, we defined it as rocket ship or brands and retailers that can really drive traffic overall or traffic at certain times of the year in terms of certain promotions. It really comes down to the right fit.

Steve Levay: (33:47)
Yeah, for sure. I would just add to that direct to consumer point too is that some retailers are thinking like direct to consumer or some really big brands are thinking about being direct to consumers too. We talked about TruSkin earlier, who’s taking this model, this approach of developing a really successful product, getting their word out there, but then having a site that acts like a weigh point for people to come and learn about them before directing traffic onto somebody else. So, taking a sort of DTC playbook, saying like how can we introduce something directly to the consumer that’s going to help them with what they want and then expanding outwards. Like retailers can think like that too.

Dr. Steve Kraus: (34:21)
And letting Amazon handle the logistics and fulfillment that they are such experts at.

Steve Levay: (34:28)

Yeah, why build that up when somebody’s already done that for you?

Brittany Sudlow: (34:48)
Awesome. I love that Game of Thrones reference. Well, I think that concludes the formal presentation, but we still got some questions I think a few rolled in. Um, but feel free to continue to submit your questions on the chat feature and we’ll try to get to them if we have time. All right. Um, first question: You guys talked about retail holidays. Do they really work and are consumers getting tired of them?

Dr. Steve Kraus: (35:14)
Do they really work? I think the answer is pretty clear. Yes. And we should expect to see more of them because they work. And I think in part, I say that they work because you know, the, the standard of what constitutes work is so low. And by that, I mean, do these holidays generate incremental sales? I think yes, usually they do. And our data seems to support that they do generate incremental sales. But even if they didn’t do that, even if they just had the effect of taking existing sales and spreading that out more evenly throughout the year, that will be considered a win for most retailers. And you know, we mentioned it earlier, but remember where, where Black Friday got a name because that was the day in the year when retailers supposedly got into the black and no business would, would want to run 11 months of the year in debt and try to make it all up in the last month.

Dr. Steve Kraus: (36:03)
So for a long, long time, uh, brands and retailers have been trying to figure out ways to even out that demand throughout the year. So already we’ve seen, uh, you know, you know, Black Friday became a big thing and then it became Cyber Monday and then it was Cyber Week. And actually, this past year we sort of found that, you know, that, uh, that Thanksgiving and even the day before Thanksgiving, we’re kind of the new cyber Monday. Uh, you saw in our data what happens with, uh, with Prime Day. I mean that’s a huge spike in activity right in the middle of the summer, which historically was a very slow time for retailers. Amazon has used that mostly for themselves and they’re selling a lot of their own products. Uh, but there is kind of a sympathetic bump in sales that happens on a lot of other sites. We saw the impact of Way Day. Uh, and obviously there are a whole bunch of other smaller retail holidays that people try to make, take off everything from National Doughnut Day to Small Business Saturday and they don’t have, I’ll have the same kind of impact. But like I said, even if it’s just a matter of kind of spreading out demand more equally throughout the year, that’s considered a win by brands and retailers. So I think we should expect more retail holidays.

Steve Levay: (37:11)
It’s interesting to think about that as like kind of like almost like an ad strategy or creative strategy too. Say like, let’s connect using this like an artificial spike, but maybe it’s, maybe it’s specifically for our consumers. So, like, you know, if you’re not a doughnut seller but your conservatives really like donuts. It’s not the greatest example, perhaps, but it’s an opportunity to like be playful and to get on board with things because they do kind of drive traffic depending on how, how big your microphone is.

Dr. Steve Kraus: (37:38)
Yeah. And just to participate in something that’s part of the more social conversation as you know, water cooler conversation and commerce and sales sort of all come together. It’s just a way to sort of stay engaged and stay relevant and something that consumers are talking about.

Brittany Sudlow: (37:53)
I laughed this morning; eBay just announced that they’re doing a crash sale, so they’re basically anticipating Amazon to crash on Prime Day this year and so they’re going to have a sale themselves, which I think just kind of speaks to the demand that there is for those Prime Days. Cool. Um, next question: This was covered a little bit in the webinar, but I’ve been thinking a lot about third party sellers on Amazon. Does Jumpshot have data on first party sales vs third party sales?

Steve Levay: (38:21)
Yeah, so that’s a really interesting thing. Um, one of the things that we can see in the clickstream data review process is when a sale is made on Amazon, especially on Amazon, um, we can see who was shipped by, who was fulfilled by who was the seller basically. Um, and sometimes that seller is the brand itself. Sometimes the seller is Amazon if it’s like a private label, sometimes that is, you know, it’s a no-name company that you’ve never heard of. And you know, one of the things we do when we do what we call discovery internally or we try to find out all the different ways you can categorize a purchase beyond just like, you know, what product category it falls into is who are all the other sellers in a, in a category. So somebody like shoes, you see an immense number, thousands and thousands of other companies that are basically these third party sellers.

Steve Levay: (39:08)
And so, you know, over time it’s not something we’ve really done like a high-level piece on, but you know, I’ve seen data as high as 60-70% of sales on Amazon are third party aftermarket resellers or third party, not, you know, primary wholesaler resellers. So, it’s a huge part of the Amazon ecosystem and I know that Amazon is starting to like to think about what that really means for their infrastructure. You know, some, some of those third party sellers, if their volumes are going to be high enough, they’re going to be kicked off the platform. Um, so it’s something Amazon is taking really seriously, partly because I would anticipate like there’s a potential brand revolt in the works if they have way too much gray market on their site. Brands are not going to want to partner with them. Um, some major brands to have sort of spoken up against it. So I, yeah, it’s a really fascinating question and one I want to dive into more.

Brittany Sudlow: (39:56)
Cool. Um, let’s see what the next question is: What role does social media play in all this?

Dr. Steve Kraus: (40:04)
Uh, social media is a really interesting element of this that we haven’t talked too much about in this webinar. And I think as always, you know, as brands and retailers trying to partner, it’s trying to understand, you know, what does each stand for, how does each resonate in the minds of consumers. And it’s really the same thing with, with social media. Uh, so if you think about a site like Pinterest that in recent months has been trying to make some significant inroads into having more of a, a commerce focus and they’ve done a lot of that through, through partnerships. Uh, so they’d had a partnership, for example, with Home Depot, and that’s kind of a good pairing because Pinterest does sort of speak to that aspirational/inspirational element of, of home design. Uh, if you look on Instagram, I’ve kind of got a different feel, a different type of audience.

Dr. Steve Kraus: (40:54)
Again, that’s a little bit more aspirational and inspirational, uh, around fashion or travel or other kinds of experiences. My son is very into SoundCloud and again, that’s kind of a, uh, you know, uh, a streaming site, but it has a strong social component to it. And the people that go there have particular interests and they’re aspirational in certain kinds of ways. So, I, I think a lot of times when we think about social, it’s not just understanding where our consumers are right now, but really what are they, what are they aspiring for? What are they looking to find out more about? Uh, you know, when we think about how consumers work through the funnel, that very early discovery phase, you know, isn’t, isn’t quite owned by anybody yet. You know, if you think of, you know, shopping is kind of owned by Amazon and search is owned by Google. As you move way upstream and the journey and you get to more of the discovery phase there, you see a social play, a role, you see publisher sites play a role. Uh, and so it does become much more tapped into the aspirational/ inspirational element of it. So I think for, uh, for the different social media sites, that’s the thing to keep in mind is what are the users they’re aspiring to, what are they looking to discover and then find brands that unlock that element.

Brittany Sudlow: (42:13)
Cool. Um, I think we have time for one more question. I’m going to kind of lump two together because I think they can be answered in the same answer: What do you mean by “walled gardens”? I’m not familiar with that term. And are you behind the firewall? When a URL is an HTTPS, can you still see in report the long tail?

Steve Levay: (42:32)
Yeah, so I mean I would say when talk about “walled gardens”, we’re really talking about sites that do not share information. So, if you’re an Amazon brand, you definitely get some analytics from Amazon, but you don’t get the whole picture. Um, so we think about that data being sort of sequestered behind a walled garden, Google, Facebook, all these giant tech companies obviously have an interest in putting that data to use for their own work. And if they’re not sharing that with you, that puts you at a disadvantage. So, we think about those, that sort of walled garden ecosystems for data itself. Um, and yes, we do see an HTTPS click. So, all and any transaction that is like encrypted, like that is something we are able to see and count and count our aggregation. So absolutely. A good question.

Dr. Steve Kraus: (43:18)
Yeah. And when we think about, uh, that phrase “walled garden”, it usually refers to, as Steve said, kind of goes big category dominators Amazon, Facebook, Google. But in another sense, it kind of also applies to your competition as well. We don’t normally think of your competitors’ site as, as a walled garden, but in the sense that you can’t really see what’s going on there. I mean, you might have some sense of traffic, but it’s much harder when you’re looking at the competition to get a read on, on transactions or to reverse engineer their strategy and try to understand what channels have really been productive for them. Uh, you know, we’ve certainly seen examples where if you just look at a brand sales in an absolute, they’re rising. But if you then look at their share online, we see that it’s falling because there’s so many categories of the digital world that are still growing quickly. You can be growing but actually falling behind. And unless you’re getting that insight from, you know, “behind the walled garden” of a competitor, you’re not really going know that competitive standing and that change in share.

Steve Levay: (44:14)
Yeah, and I mean we also connect between them, right? So, like if you have a Google strategy to drive traffic to a retailer, we can see that as an addition to how effective that traffic is once you get into the retailer. So, between these walled garden ecosystem, the consumer behavior that we’re measuring is not like, you know that consumer does all those and they have a logic behind them and it’s sometimes hard to deconstruct that logic unless you have the full picture and our data really powerful because it gives that full picture.

Brittany Sudlow: (44:39)
Yeah. I think a lot of brands and retailers, are stuck just optimizing their own UX and their own flow on their own site and that’s, they just spent hours and more headcount. And that’s just all they focus on, but you have to look kind of beyond your site and that, that complete journey. So cool. Um, all right, well that concludes today’s webinar. If you didn’t have a chance to get your question in or if we didn’t have a chance to answer your question, someone from Jumpshot will reach out to you within the next 24 hours. And if you have any additional questions or would like to speak with someone at Jumpshot to learn more, feel free to shoot us an email at hello@jumpshot.com or visit our website, www.jumpshot.com. Thanks for joining and have a good rest of your day.

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