Tag: online shopping

Social Media

It’s a Facebook Thing: Connecting Users With The Products They Want

 

You’re scrolling through your newsfeed, you see a sweatshirt that has your name or your profession in a catchphrase, and it’s only $30. It feels weird to see something so distinctly “you” pop up. So, how does Facebook do that? If you feel like Facebook has more ads than usual, you aren’t dreaming it up; Facebook has been hitting all of us with more ads that are more relevant to us. Although it may seem unnerving at first, Facebook’s data collection tools are fascinating and can often connect users with products they want.

 

Facebook uses your profile to create personalized ads. If you like Target’s Facebook page, then Target will start delivering ads to you. Facebook will deliver ads to you based on what your friends like. However, it’s not just what you and your friends are doing alone that generates ads; it’s also demographic information. Major life events like getting engaged or married will produce content specifically for you. If you are recently engaged and post it to Facebook, wedding dresses and wedding venues will start to populate your feed. Kind of cool, huh?

When an advertiser creates an on Facebook, it can select all sorts of parameters, so it reaches the right people. For example, if someone is trying to sell a swimsuit: They can target it towards people that live near large bodies of water or has swimming listed in their interests. The more information you put about yourself on Facebook such as your age, where you live, where you graduated college, activities you like and where you work: This all will determine what ads are delivered to you.

If you don’t include all of this information on your profile, Facebook turns to your friends to fill the gaps. Facebook only needs to know one particular thing about you, like where you live, and what your friends provide to create a reasonable demographic that advertisers can use to reach you.

Let’s say you have a Facebook account just for the sake of having a profile. Facebook collects data through companies such as Datalogix, Acxiom, Epsilon, and BlueKai. These companies collect information about you through things like store loyalty cards, mailing lists, public records, browser cookies and more. So, if you are a customer at Starbucks and utilize their rewards program, you will see a Starbucks ad pop up on your Facebook at some point, or even a tee-shirt with a coffee cup on it saying Coffee Addict.

These data collection companies know more than you would think: race, gender, buying habits, economic status and more. If you don’t use loyalty cards or enroll in reward programs when you shop, Facebook still has you pinpointed. If you purchase a car at a dealership, they will more than likely ask you for your email to send you reminders about car servicing and more. That dealership wants to advertise on Facebook, so they upload a list of all of the email addresses they have. That data is then made private, and Facebook pairs the email addresses with the one you registered on Facebook. If these match, you might see an ad from that dealership on Facebook. Your friends might see the same ad from the dealership because they are reaching out to their target audience.

There’s no reason to feel a little spooked by all of this, but all of this information is kept private. Facebook uses a system called hashing to prevent from all of your private information from leaking. When you went to the grocery store last week, and you tried a new brand of yogurt that has just launched and used your discount card at check-out, Facebook might have delivered an ad for that yogurt that you had not seen previously. Don’t worry; it’s not because your phone heard you say how delicious it was at first bite.

Here at Velocity Agency, we pride ourselves in our knowledge of data collection and ad targeting. If you are trying to expand your target audience, we can help you take your brand to new heights. We have the knowledge and experience to make those internet users stop mid-scroll and CLICK the purchase button.

Market Information

What’s in the Box?

Online shopping started in 1994 and spread like wildfire in 2017. As a result, nearly 79% of Americans shop exclusively online. People have ditched waiting in long lines, driving through traffic, and searching for the best bargain by simply scrolling through the World Wide Web. It doesn’t get much simpler than being able to type in anything that you are looking for and setting filters to narrow it down to your preferred product. Business owners discovered they needed to be innovative and develop a new way to sell their goods online. Thus came the birth of an entirely unique time in online shopping: The Box Pop.

Subscription boxes are everywhere. Chances are if you are on the internet, there’s at least one subscription box beckoning your wallet. Birchbox put the subscription box retail trend in motion with its launch in 2010, with a specialty in beauty, grooming and lifestyle products. Birchbox subscribers pay $10-$20 to receive goodies like skin rejuvenators, fragrances, and makeup. This company has 800,000 active global subscribers which equal a total of $96 million in annual sales.

Just like with any successful business model, the imitators quickly followed suit. There are subscription boxes for everything from razors, tactical gear, video games, clothing, and of course: food.  In 2012, Blue Apron was founded and is now known as the gold standard for food delivery services. Each Blue Apron box contains enough food for you and your family (2-4 people) and offers a very reasonable price range ($59.94 – $69.92).

Subscription boxes have risen to fame because of three different reasons: convenience, personalization, and excitement. Subscription boxes are a perfect example of experiential marketing, a strategy that directly engages consumers and encourages them to participate in the evolution of a brand or a brand experience. Therefore, creating a consumer-producer relationship with the brand.

Convenience

There’s nothing more convenient than coming home from a long day’s work to see a box on your doorstep full of goodies; meal kits offer a hassle-free way to prepare dinner after work. Some consumers don’t like to get off of work and then face the stress of determining a recipe, shopping for ingredients, and preparing a meal. With meal subscription boxes, all of that is taken care of for you. There are even specialized subscription meal boxes made for those with particularly demanding schedules such as college students.

Personalization

The difference between the average consumer now compared to ten years ago is the value placed on personalization. After all, we live in a time where there’s a space for each of us on the internet that we can personalize and make our own through social media. Upon subscribing to a box, subscribers are asked a series of questions. Some have a list of all of their products with check boxes for the customer to click, while others have text boxes where customers explain their product preferences in detail. Consumers have the chance to put a little of themselves in their ordering and feel special in the process.

Excitement

You’ve already skipped the stress of real-life shopping, and you have defined yourself by making your product preferences known. Now it’s time for the fun part: the excitement of the box on your doorstep. Because the business asks what makes you tick, you know that the box is going to contain products you will love. But, it’s the feeling of it being a gift and a surprise that really has jump-started this marketing trend. This type of excitement isn’t just trending with subscription boxes either. Unboxing videos routinely take a few of the top 10 spots on most-viewed YouTube watch lists, among the music videos from international superstars and the latest viral prank.

Even though the marketing model for subscription boxes seems to have everything that we as consumers want, some recent news has made many of these business owners wary. The subscription box business is not immune to the same dangers of other, more traditional businesses. Many of these companies have been reporting a dramatic slump in sales and must think of ways to increase sales. The subscription box market is severely saturated, with more than 2,000 different types of boxes to offer and steadily growing. Also, big companies such as Starbucks, Sephora, Macy’s, and Adidas are joining in the craze which is making the smaller companies lose steam rapidly.

What do you think the next step will be for these business owners to stay on top?

Market Information

Alexa, Purchase Whole Foods

In our last newsletter, we detailed the Retail Apocalypse. Perhaps we heralded this shopping doomsday too soon. With the latest news about store closures and business bankruptcy, it’s easy to give up on the classic brick-and-mortar retail place. As people seem to spend less on items and more on travel, according to Business Insider, retail could be on its way out eventually. However, if there’s one thing that is predictable about the market, it’s that it can sometimes be unpredictable. Amazon’s recent acquisition of Whole Foods alone proves that retail might not be facing an apocalypse so much as a digital makeover.

Last week, the online retailer site Amazon announced its $13.7 billion (including debt) purchase Whole Foods Markets, signaling a significant new step for the company outside online purchases. In addition to this purchase, Amazon has also announced a plan known as Prime Wardrobe, a system to allow customers to try on clothing and shoes before purchasing them, to expand its fashion retail as well. Many analysts note that these moves signal not a revitalization of classic retail stores but a reliance on them as well. After all, why would a company like Amazon spend billions on a system that is supposedly out of style? In fact, based on these announcements as well as Amazon’s continuing plan to break into pharmaceutical areas, retail stores still seem to have some value outside of online services.

Perhaps the classic brick-and-mortar stores just offer a sense of security, consistency, and personality. Offline sources have, for longer than Amazon, often gathered customer movements in real time to understand what products were preferable. Since people have always relied on going to stores for goods, the retail store remains a staple of the industry. Of course, regarding Whole Foods, food retail remains a reliable source of physical shopping with people going for food on average twice weekly. Though the places to find food or clothes have been static for quite a while, that’s not to say that the system cannot be improved upon for efficiency.

While retail stores might still have a place in the digital revolution, they may have to tackle a new set of standards to keep up with the competition. The latest purchase of Whole Foods offers Amazon a real-world base to test out online systems ranging from increased WiFi to visitor data profiling. With Amazon’s system of big data, Whole Foods might soon be able to access customer preferences with groceries and allow them to make recommendations for additional purchases in real time. This could also connect to Amazon’s home delivery system where grocery preferences can already be suggested for purchase before heading to store. In essence, this new method of purchase is not a preference of physical or digital stores but a combination of both.

Still, none of this guarantees that Amazon’s new method is sure to work or benefit the classic retail store. Indeed, some retail stores have seen drops in stocks following Amazon’s announcement. Nevertheless, this method proves there are still new horizons out there for the retail business. The future may be digital, but at least there is still a future at all for retail stores.  

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