Just like buying a gym membership won’t make you fitter, buying tech won’t add instant capability. Adore Beauty’s CMO Dan Ferguson talks tech, data (and gym).
To celebrate Online Retailer Conference & Expo this week, we speak to Dan Ferguson, CMO of Adore Beauty about what’s next for e-commerce and why your staff are the key to innovation and driving growth:
Data: how do you cut through the hype for tangible results?
One of the things that sticks out when you start investing in data and analytics is articles written about data use in broad terms and proliferated with buzzwords. Optimising processes, using algorithms to reduce costs, building AI to scale personalisation all sound like actions but are actually the end result. Trying to squeeze real value out of these is like tearing apart a cake to try and figure out the ingredients.
To get tangible results from your data investment, start with a list of ‘’valuable questions’ in your business. If you’re lucky enough to have team members, aim to get cross functional input on these questions so that you’re more likely to uncover value agnostically.
For each question, make sure that the kind of answer needed is defined by the person who wants to use the data. For example, a question or problem to solve could be to ‘Define LTV to improve marketing effectiveness’. This is a doozy – ask this to a roomful of analytics managers and you’re likely to get just as many different types of answers. The competitive advantage is in making sure the answer YOU get is instantly usable by the function that needs it. As an example, a solution could be a percentage boost to apply that is unique for each marketing channel.
Another way to increase the impact of data and analytics teams is to give team members the chance to work hands on in areas they are supporting. If your data person is building a forecast to increase the effectiveness of your warehouse resourcing, make sure they spend time at the warehouse, and understand the real benefits (and losses) their algorithms will support.
Through understanding the problems and processes they are working on, team members can help to instantly ensure solutions are ‘fit for purpose’. Stronger operational ties will also accentuate values like flexibility, naturally (and gently) increasing personal accountability and interest in how real value is realised.
Scaling with strategy and avoiding the pitfalls…what are your top tips?
One of the biggest pitfalls when you’re growing a business too quickly is how it can reduce business impetus to critically evaluate performance. Meeting revenue and other financial goals can too often be a means to an end – that is, we’ve hit our targets so we must be on the right track! The danger in this is that it’s just a matter of time before your growth obscures a business trend or issue that develops over time – and once it’s finally identified, correcting course or adapting is practically a much bigger issue than it need be. Every business is different, however, a few things I’ve learnt through experience;
- Evaluate performance and growth with more than one lens. If you run your business by revenue or product growth, try adding marketing channel performance as a critical review. Likewise, if marketing channels are a focal point then try taking a step back and measure/target customer acquisition, retention and LTV as a counterpoint.
- Add extra points of analysis and reflection to stretch the business and achieve in multiple dimensions and expands the definition of ‘on track’ so complacency can’t get an easy foothold
- Ever heard of the phrase ‘strong opinions, weakly held’? To help us reach the right decision, we can use this framework derived from psychology – this enables retailers to make decisions or forecasts with incomplete information and can be really useful in online retail. Have a defined strategy, and monthly/quarterly plans but retailers need to accept that the data or results can mean adopting a different focus or direction on the fly — have your B and C plans defined and ‘on the boil’ to support this.
How do you make use of the tech at your disposal?
With the high stakes sales process that can go along with tech investment for an online business, it’s easy to feel like you’re buying an end state – but once the dust clears there’s many more steps before that state is realised.
Even more common – like buying a gym membership can make you feel fitter – buying tech itself won’t add instant capability and progress to strategic goals. A key point is hiring the right talent to be able to really sweat any asset you add. Prioritise a bias to action and the ability and desire to learn quickly over extensive experience.
Supplement this with an external contact or viewpoint that is as battle tested as possible – explore international inputs and consultants from even more developed online retail markets. They’ll add a sense check and critical view with real sharp competitive advantage.
Don’t be distracted by bright and shiny things. The best tech platforms are constantly evolving and adding functionality (look for this in the pitch stages) and aim to use more of what you have before considering adding extra.
Nurture this by ensuring any tech is virtually owned by the function or skill set that is best placed to realise value from it. That means marketing owns their email platform and organisational IP around it. Cement this relationship with clear goals and KPIs for the function that naturally encourages the team to realise as much value as possible from the capital they work with.
Our working relationship with Emarsys is a good example of these lessons in practice. After two years, our customer marketing revenue grew by 2x, and our business started to focus elsewhere for growth. In my first few months, I added a talented team member to focus on the platform with clear KPIs that she used to inform rapid changes and improvements. Emarsys supported us with constant platform and feature improvement – plus, they introduced our first predictive model to drive smarter AI-like automations. Since that initial pause 18 months ago, we’ve increased our feature usage of the platform by more than 50 percent. The end result has seen this area grow by 6x revenue.
What should retailers and brands be investing in now to remain competitive in the long term?
Brands need to invest in data and analytics. Retailers should create a single platform that brings together all your data sources and grows your business IP in how this platform is applied and used across each and every function in a BAU way
For brands, consumers’ inboxes and visual fields are increasingly crowded with online retail offers and brands. Customers’ purchase and repurchase decisions will increasingly be driven by brand as a starting point and all the tech hype and digital marketing bells and whistles are table stakes.
Brand is no longer a campaign or an aesthetic, rather it is how your business exposes and demonstrates its value every day in the most meaningful way to your audience. Look for where in the business your brand is being best exemplified, and then work to nurture and develop this. The end points can be marketing campaigns, experiences and design but it won’t resonate unless it starts with something real.
See presentations from Adore Beauty on both days of Online Retailer as well as a presentation from Emarsys on Day Two on the topic: Rocket Fuel for $100m growth – How Adore Beauty keeps breaking growth barriers with a data driven brand. To see the full agenda for Online Retailer Conference & Expo (to be held 24-25 July at the ICC Sydney) or to buy tickets, click here.