How to be ‘Fab-lytic’ with Consumer Analytics: A Fabletics Case Study

For storefront businesses, tracking a trend in foot traffic, favorite items and drawer revenue comes pretty easy with a daily routine. In e-commerce, where you don’t come face to face with your visitors, consumer and web analytics become vital in analyzing (and improving) your business performance.

Many companies, especially in the retail industry, are finding the benefits of e-commerce to outweigh the costs of a storefront because analytics can lead to higher customer satisfaction and therefore greater loyalty. The past few months one e-commerce only retailer in particular has caught the eye of many marketers for their analytics-driven strategy and model.

In September, the Wall Street Journal reported that sales of yoga clothes went up 45%, but participation in yoga only went up 4.5% (Germano, 2014). Fabletics, fronted by America’s sweetheart Kate Hudson, has been a frontrunner in maximizing on this retail trend and taken the women’s athletic wear category by storm with their members first, analytics driven business model.

“There’s so many aspects as to what the business plan is and why we believe it’s been successful,” Hudson told Vogue. “There was a hole in the online athletic-wear community of affordable athletic wear that was hip and fashionable, and when I heard that I thought what an interesting thing – because that is where you reach women. Why wouldn’t you want to reach women on a wider scope to motivate them to become more active? To me that’s what it’s all about.” (LOVEALYVIA, 2014).

How has Fabletics set themselves up for success? Through an analytics driven, e-commerce subscription model that strives to provide the best in customer satisfaction bringing increased retention and maximum customer value.


How’s it Work?

When a new user visits Fabletics, they’re immediately asked to provide data. Asked for your fitness frequency, attitude, preferences and style, Fabletics is able to learn enough about you as a first-time visitor to provide recommendations on the best suited fitness outfits for you based on style and functionality. According to Lindsay (2014):

“To overtake the competition, e-commerce sites must create compelling, relevant shopping experiences for every one of their customers. But the clear upshot is that personalization thrives in an e-commerce environment. It’s debatable that there’s no other type of website more innately aligned with the ins and outs of personalization than a shopping site.”

Fabletics has taken personalization to the next level, incentivizing users to become VIP members in order to continue receiving it. Those who sign up for the subscription-based service receive recommended outfits each month. This creates a deeper relationship between Fabletics and an individual consumer; more deeply tracks an individual’s preferences and, for the cherry on top, allows consumers to save on their purchases.  The business model is smart, innovative and enticing – a win for the business and a win for the consumer.

Smart Model – Smart Marketing

Most appealing about e-commerce only businesses are their capabilities for smarter marketing. Beyond incentivizing members to openly and continually share their individual preferences, Fabletics has tapped their resources to utilize available data to reach their target audiences. Perhaps its because I’m a young professional woman who undoubtedly wears yoga pants (although I do not yoga), but Fabletics had been inundating me across Pandora, Google, Pinterest and Facebook for three months before I took the plunge and joined the club.

With tools like Facebook Exchange, DoubleClick, Conversant, Connexity and Facebook Custom Audiences; they’ve pulled data and served targeted marketing messages. According to Connexity (2014), “shopping patterns are the best predictors of consumer behavior.” Utilizing their experience in hosting some of the world’s largest e-commerce shopping sites, Connexity builds customer-shopping profiles and connects retailers to new prospective customers who are either in-market or considering similar purchases.

Beyond prospecting new customers and member sign-ups, Fabletics follows their members’ trends and remarkets to them for future purchases. Using Google Analytics and DoubleClick, Fabletics tracks individuals’ visits to the site and specific browsing habits and when no purchase is made or the 1^st of the month is on the horizon they’ll begin serving specific marketing with that individual’s most likely picks across various platforms, primarily email and social media. According to Google Analytics (2014), “While you can implement Dynamic Remarketing by creating only an all users list, creating more narrowly targeted lists lets you focus your ad content and budget where it will have the most impact.”

Finding Further Success

“Personalization is critical to e-commerce sites. We are in a deeply relationship-driven period in digital marketing, and consumers want to feel those one-on-one connections with the brands for which they’re opening their wallets. Gather the data, continue to cull information, and be prepared to make adjustments in real-time—now and forever—so you can deliver the kind of personalized greeting, dynamic content, and powerful drives-to-buy that get results and turn unknown shoppers into loyal buyers.” (Lindsay, 2014)
Bringing even further depth to their data analysis for individual users and innovation to their marketing strategy, Fabletics should consider improvements like:

·       Time of day conversion knowledge – instead of mass sending the VIP reminder that your monthly picks are available, learn an individual’s most likely time to convert and browse the site to send the email and shorten the conversion cycle

·       Price comparison analysis – let user’s know just how much they’re sharing compared to other athletic wear retailers

·       Negotiating shopping cart – convert those wavering to purchase with items sitting in their shopping cart with real-time deal offers to close the deal

·       Recognize most loyal referrers – recruit even more customers to refer friends and family with public recognition and reward for their efforts (i.e. social recognition of gift for free outfit for referring 10 friends who purchased last month)

·       More social integration – further integrate with social platforms with click to purchase inside the networks within pop-up boxes or application tabs without having to leave the site

·       Guest checkout – convert data-protectors and increase sales with a guest checkout option. It could be limited to one guest checkout per IP address and promote deeper incentives for becoming a member by driving home the privacy policy with more detailed language to create trust

References
Connexity. (2014). About. Retrieved from http://connexity.com/about/
Fabletics. (2014). How fabletics works. Retrieved from http://www.fabletics.com/how-it-works
Germano, Sara. (2014, August 20). Yoga poseurs: athletic gear soars, outpacing sport itself. Wall Street Journal. Retrieved from http://www.wsj.com/articles/yoga-poseurs-athletic-apparel-moves-out-of-the-gym-to-every-day-1408561182
Google. (2014). Create audiences for dynamic remarketing. Retrieved from https://support.google.com/analytics/answer/3457161?hl=en
Langault, Marie-Josee. (2014, October 14). Move over lululemon, fabletics new yoga line changes the rules [Blog Post]. Origin. Retrieved from http://www.origindesign.ca/move-over-lululemon-fabletics-new-yoga-line-changes-the-rules
Lindsay, Kevin. (2014, May 23). Shopping gets personal: how personalization redefined e-commerce. Adobe Digital Marketing Blog. Retrieved from http://blogs.adobe.com/digitalmarketing/personalization/shopping-gets-personal-personalization-redefined-e-commerce/

LOVEALYVIA. (2014, August 26). Kate Hudson fabletics (principles of marketing and research). Couture Bay. Retrieved from https://couturebay.wordpress.com/2014/08/26/kate-hudson-fabletics-principles-of-marketing-and-research/

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Say “Hello” to Your Big Brother: Google

Time may be the most valuable resource on earth. Consumers today want what they want … yesterday. Companies are faced, daily, with the challenge of knowing their customers well enough to deliver. The Internet has created an active, intelligent and data-driven environment where companies and consumers alike can share and collect an overwhelming abundance of accessible insight, analytics, preferences and reviews in real time. According to Benady (2012), "Some in the industry predict that online monitoring technology will develop in accuracy and effectiveness over the next five years to such an extent that it will become an indispensable part of marketing." One company that is ahead of the curve in data collection and data-driven marketing is the true big brother of the Internet…the boy next door...Google.

According to Google, I am a woman between the ages of 25 and 34 who speaks English as her primary language and has made over 1,000 searches just this week for things such as ISU football schedules, fitness plans and “superhero who wears blue”.  I like Christmas, grammar rules and historical landmarks. Oh, and I spend my 30-45 minutes of free time each week watching movie trailers and Boxers jumping on trampolines on YouTube.

I don’t eat dinner across the table from a Google employee or sit at a desk at night filling out surveys to share these details with Google myself. As I am searching Google, YouTube and using Chrome, it turns out they’re searching me too. This is not new news. In fact, it’s been around a lot longer than we’ve all been aware. According to Wallace (2014), “Disable cookies from your browser and you won't be able to use Facebook, Twitter, LinkedIn, Google and many otherwise free digital services. That's because these platforms are not free. We all exchange our data for the service, and in turn receive more targeted ads based on who our friends are, what we say to them in email, who we retweet most often and what keywords are typically found in our digital resumes.” For the most part, data collection is done with YOU the consumer in mind in order to serve banner ads, search results, news and videos that are relevant to you – saving you time and providing value in your online experience.

Google happened to find that not only is this valuable experience of relevance important to consumers, but also to businesses. Consumers are more likely to click on a banner ad or search result they’re actually looking for – it seems like common sense, right? So why not make money from serving these great results? This is the question Google has led the way in answering as they build a profile based on your email content and web browsing habits, monetize your purchase information from the iStore and storage devices such as iPhone and iCloud. Google’s personalized experience is so successful that with the launch of the Nexus 5 they built the Google Experience Launcher (‘GEL’) into the Google Search allowing access to anyone. According to Kelly (2014), “regardless of whether you own a phone or tablet made by Samsung, HTC , Motorola, Acer , Asus, ZTE , Huawei or anyone else, you can now get that Nexus 5 look and feel and wave goodbye to TouchWiz, HTC Sense and other third party skins.”

Privacy is a right. Consumer privacy, then, refers to both physical space and information. According to Caudill and Murphy (2000), consumer privacy is on a continuum suggesting "that consumers have varying degrees of concern with privacy and place different values on their personal information." Where many consumers online willingly complete form fills, accept sharing information from Facebook and save their credit card information; others will shy away from these actions and therefore purchases or participation in research due to the collection of their private information. Google has had to manage consumer privacy vs. business ethics vs. business success since the beginning. According to Fran Hawthorne, US author of Ethical Chic:

Consumer pressure has definitely made online companies more sensitive to ethical issues like the environment, human rights, and privacy. In terms of privacy: Apple itself in 2011 had to back off from an effort in which iPhones and iPads were secretly collecting information on users' locations. There are a lot of reasons, including the Google 'right to be forgotten' ruling, the furore over Google Earth, the NSA revelations, fear of hacking, and I think, consumers just getting fed up with ads. (Channel 4 News, 2014)

Apple’s newest privacy statement addresses the consumer pressure and takes a shot right at Google’s methods directly from Tim Cook himself:

We don’t build a profile based on your email content or web browsing habits to sell to advertisers. We don’t "monetize" the information you store on your iPhone or in iCloud. And we don’t read your email or your messages to get information to market to you.

Cook recognizes the recent privacy concerns with Target credit card hacks and private celebrity photo stealing and addresses the trust a consumer should have for Apple over Google head on. Fair play Mr. Cook, but Google responds too. Apple has also created search engine DuckDuckGo which “doesn't track your searches or mine your data for advertising or other purposes…[however] it doesn't rival Google when it comes to providing answers to questions right at the top of its results” (Channel 4 News, 2014).

Notable efforts from Apple don’t go unnoticed, but neither do Google’s efforts to continually address these issues as well. This year the European Court of Justice made the “right to be forgotten” decision ruling that “search engines with European domains – such as Google, Bing, and Yahoo – must allow EU and European Economic Area citizens the ability to remove links to personal information that is ‘inadequate, irrelevant, or no longer relevant’” (Stern, 2014). Comprising 90 percent of the search volume in Europe, Google holds the burden most of responding to this request. I question if it is even possible to truly erase something once it has been posted. Even SnapChat that supposedly erases its servers every 24 hours and immediately after a viewed image or video to an individual, I question its validity. Dr. Luciano Floridi, professor of philosophy and ethics of information at Oxford University validates my questions in his findings that “the information remains there for anyone who wants to find it by added means’ pointing out that currently anyone can simply use the core google.com domain to access the links, rather than Europe-specific domains such as Google.uk or Google.de. ‘It’s almost like taking aspirin when you have a bad toothache. That can help momentarily but the problem’s there. You need to go to the dentist’” (Stern, 2014).

I argue that the invite must also be honest about the value to the consumer in participating and sharing private information (i.e. purchase, location, profile, etc.). This leans to an ethical issue of a social contract in online marketing research. According to Caudill and Murphy (2000), "consumers opt in to a particular activity from which they perceive future information streams will be of value." If it were more clear to a consumer how the collected information from search data to purchase data was being used, and by who, in order to give them what they are looking for more quickly at a later date, the social contract would be fulfilled. The question remains if it is truly as clear as it sounds…and, unfortunately; it is just not that simple. I am constantly telling potential and confused clients "its very big brother" in explaining the data available to us to serve ads across an ad exchange.

References

Benady, D. (2012). The world’s biggest focus group. Marketing, 35-37.

Brandom, Russell. (2014, September 18). Apple’s privacy statement is a direct shot at google and I love it. The Verge. Retrieved from http://www.theverge.com/2014/9/18/6409915/apples-privacy-statement-is-a-direct-shot-at-google-and-i-love-it

Caudill, Eve M. and Murphy, Patrick E. (2000). Consumer online privacy: legal and ethical issues. Journal of Public Policy & Marketing, 19(1), 7-19. Retrieved from http://www.jstor.org/stable/30000483

Channel 4 News. (2014, June 4). Is apple teaching google a lesson in internet ethics? Retrieved from http://www.channel4.com/news/apple-bing-duckduckgo-google-search-engine-online-privacy

Kelly, Gordon. (2014, January 9). Google experience launcher an easy hack to get the look of the nexus 5 on your phone or tablet. Forbes. Retrieved from http://www.forbes.com/sites/gordonkelly/2014/01/09/google-experience-launcher-an-easy-hack-to-get-the-look-of-the-nexus-5-on-any-android-phone-or-tablet/

Stern, Rachel. (2014, November 21). Google loses ground in fight against europe’s ‘right to be forgotten’. The Christian Science Monitor. Retrieved from http://www.csmonitor.com/World/Europe/2014/1121/Google-loses-ground-in-fight-against-Europe-s-right-to-be-forgotten

Wallace, Tracey. (2014, November 3). The ethics of data, visualized [Infographic]. Smart Data Collective. Retrieved from http://smartdatacollective.com/tracey-wallace/279421/ethics-data-visualized-infographic

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Don’t Forget to ‘Mention’ It

Social media is becoming increasingly important for marketing research. Aside from using such venues for recruiting research participants, content analysis of the social conversation can provide valuable insights into consumer behavior. With over 1.28 billion users on Facebook, 500 million tweets sent every day, 200 million monthly active users on Instagram and over 400 million Snapchat snaps shared per day (Digital Insights, 2014); social media allows vast and immediate access to the groundswell of public and, often, private opinion.

Monitoring the social conversation in marketing research will reveal consumer insight in to their thoughts on your business, industry and individual products. According to Blakeman (2010), monitoring “discussions of you and your services or products is essential if you are to nip bad press in the bud. Respond appropriately and you can turn negative feedback into a positive story.” It may also be possible to uncover valuable insight in to product improvements and consumer engagement tactics. According to Byrne (2014), media monitoring allows you to:

§  Tap into conversations about your brand, even when people are not talking directly to you

§  Identify other terms related to your brand and how they’re being used

§  Identify trending topics and hashtags — conversations you should be taking part in

§  Where they’re happening — both in terms of platforms and channels and geo-location

§  What languages these conversations are happening in

§  Who’s leading and influencing these conversations

            Mention, a social media and web-monitoring tool, allows you to set alerts based on keywords and view content related to those keywords directly within the tool’s application. According to Cleary (2013), “when you monitor and track keywords, you can find potential business, build relationships with new people and respond quickly to situations that could damage your brand.”

            Mention alerts are easy to setup. You can add any keywords or filters you’d like to narrow your search. For example, if you are looking for the social conversation surrounding “craft beer” you would filter your list with the advanced setting of ALL. Mention users can also filter what sources you are actually looking to monitor. I’ve found it works best to turn off notifications from the web (i.e. articles) and filter only social networks for a true look at the social conversation.

Let’s take a look at an example:

Iowa Beverage Systems, a beer distribution company here in central Iowa, can use Mention to monitor changes in their brand recognition, beer consumption and alcoholic beverage industry, as well as to gather audience insight and content related to each of the brands they distribute.

(Source: “Iowa Beverage Systems: Beer” Mention, 2014)

            Iowa Beverage Systems could set up alerts to monitor the terms “beer”, “craft beer” and “drinking” in order to gather audience insight. As in the photos above, Iowa Beverage Systems can conclude the terms are used often across social media channels with over 3,000 mentions in under 12 hours. It is also obvious that Twitter is a primary source for the social conversations on “beer”. From these insights, Iowa Beverage Systems should consider monitoring Twitter more closely and activating users through the social network more often than other networks like Facebook.

            The Mention dashboard is an easy to use interface sorting mentions by priority, favorites, relevance and more. According to Karl (2014), “you have the option to mark mentions as favorites, send them to trash or flag them as irrelevant. Anytime you mark a mention as irrelevant, you’ll stop receiving mentions from that source – it’s a good way to further filter results and cut down on the noise.” Can you think of a thread in your business’ social conversation that you’d want to filter in order to cut through the noise?

Mention should be used in tandem with Google Analytics to get a full picture of consumer interaction with your business through social media. Where Mention provides insight and response in to the social conversation within all social networks, Google Analytics provides insight in to which social channels are sending the most qualified visitors to your website and further insight in to only some “partnered” networks.

(Source: Google Analytics, 2014)

            According to Melissa Baker, author of Social Media Marketing: A Strategic Approach, “Having a comparison of the user drop-off rates across all channels is helpful in gaining a deeper understanding of what is working and what is not. Knowing the number of visits each channel sent along is not enough to gauge the true success of your messaging” (Peyton, 2012). This social visitors flow also outlines a visitor’s journey through your conversion funnel, providing a quick analysis and check that channels are indeed leading consumers toward a conversion.

            Activity stream within Google Analytics is the most direct comparable feature to what you’ll receive in using Mention. Unfortunately, it only works within lesser known social channels such as Digg, Echo, Delicious and Google+. According to Peyton (2012), “Activity Stream allows you to view individual post/page analytics, the content on Google Ripples, the actual content and the social activity. With one click, you can jump to the interaction and respond, follow the user and monitor conversations about your content.” With the real-time insights and capabilities, it is too bad that Google falls short in playing nice with the two largest social networks, Facebook and Twitter. Mention covers them all and in 42 languages (Karl, 2014).

            As a business you are looking to increase conversions. Where Mention allows you to track successes and challenges within the social conversation, Google Analytics will track the lead to conversion once a user visits your website. By setting up GOALS within your account, you’ll be able to begin tracking each conversion. According to Peyton (2012), “With only a few clicks, you can quickly start tracking how social traffic helps drive website conversions or events. This can include obvious conversions such as an online purchase or lead form completion, but it can also include micro-conversions such as video views or blog visits.”

(Source: Peyton, Lisa. (2012) Social Media Examiner.)

            Between Mention and Google Analytics, social marketing efforts can be tracked from beginning to end, inside and out. This gives you as a marketer both the broadest and deepest insights for analysis and interpretation. It all starts with a measurable objective. Once an objective is set, track your strategy using both tools to draw the strongest conclusions for optimization. 

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