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The Brand behind the Brands We Love

In brand-building, Healthcare, innovation, retail, Shopper Marketing on January 2, 2014 at 1:01 pm

Inmar leads the way in digital promotions

by Jeff Sandgren

As we wrap up another round of holiday shopping mania, there’s a powerful force at work behind the scenes. For more than 30 years a company you may not know has been quietly helping you shop every day, and lately they’re ambitiously working to change the way you’ll shop tomorrow. In the ‘Emerald City of Retail,’ the hidden Oz who’s helping to enhance your shopping experience (while not bothering to attract your attention) is a company called Inmar, and their ‘Intelligent Commerce Networks.’

Inmar Inside

Sometimes the brands you know and trust deliver on their Brand Promises by relying on other brands. Think ‘Intel Inside®[i]’: a great advertising slogan, catchy, memorable, succinct and effective. When you buy a computer, you’ll hopefully never even have to see the Intel chip, much less actually touch it; but the little sticker on the outside telling you it’s in there could easily sway your purchase decision. Another example, wordier but similarly powerful, is BASF’s old slogan:

We don’t make a lot of the products you buy. We make a lot of the products you buy better®[ii].

In both of these cases, the B2B company wants you, a consumer, to value their brands in order to make you feel better about buying – not from them, but from their customers, the B2C companies that sell finished consumer goods to you. It’s unlikely that you ever bought a chip directly from Intel or a drum of chemicals from BASF (unless you’re a bigger geek than the editors of BrandTech News, or go by the street name “Heisenberg.”)

But while you almost certainly know who Intel is, and probably have heard of BASF – the largest chemical company in the world (even if you don’t know what the letters stand for) – you might not know who Inmar is. And you might be surprised to learn that the financial transactions they process en masse daily have an annual aggregate value of about $44 billion across their promotion, supply chain and health care networks.

If you’ve ever clipped and used a paper coupon, chances are good that it was processed by Inmar. This was their first competency, and remains a major component of the company’s business. They started handling coupons back in the early 80’s, as Carolina Coupon Clearing, a company formed by the son of a Reynolds Tobacco exec who brought in a team of former IBM associates to elevate the process from one which, at the time, relied on weighing masses of paper coupons by the pound. The solutions they built, and the refinements that have evolved since, now enable a smooth, secure processing of billions of coupons from thousands of brands in countries around the globe. They currently process coupons for a large share of US companies; and they serve a global customer base with their broader promotional solution portfolio that has grown to include not only paper coupons, but also rebates, sweepstakes and now digital coupons – more on that in a minute. This approach of harnessing technology and smart thinking to improve complex processes still steers the company.

David Mounts, Inmar CEO

David Mounts, Inmar CEO

“It all starts and ends with people,” explained Inmar CEO David Mounts, at a recent interview. “We strive to find the best minds and intellectual capital we can, then we direct our investments to make it easier for bright people to deliver great solutions to our customers … and ultimately great experiences to consumers.”

Inmar innovation

In the coupon world, paper still dominates in sheer volume, but the most impressive growth percentages there days are being posted by digitally discovered coupons. Digitally discovered coupons fall into two major groups. The already familiar Print-At-Home (PAH) coupons – those discovered online and printed with home computers – increased in use by more than 12 percent in the first half of 2013, relative to 2012. The newer kid on the coupon block is the use of completely paperless “e-wallet” coupons, where the reward is either loaded to a consumer’s loyalty card or stored on a smartphone app. While still a small segment, the use of these promotions increased by more than 230 percent in the same period.

The targeting and personalization capabilities of these digital offers provide powerful new ways for marketers to engage and entice consumers with increasingly relevant offers, and to gain insights on what consumers preferred (and what provided the best return on investment). But with this new sophistication comes the matter of new complexity. To help brands and retailers cut through the cyber-maze, Inmar has developed their Offer Management app, which lets marketers easily create offers, aggregate performance data and score the promotional effectiveness of multiple offers across all channels.

The rapid development of these solutions by Inmar has, in part, been accelerated by two recent acquisitions: the first, a company that pioneered an innovative technology to facilitate the secure distribution and redemption of digital promotions; and the second, a company with deep expertise in shopper behavioral analytics. By combining Inmar’s own knowledge and experience of couponing and promotional strategies with the added power of analytics and shopper insights, and with the real-time, on-demand delivery of offers to smartphones and tablets, Inmar’s innovations are changing the promotional game for brands and retailers – and delivering offers to consumers on products they want, with promotion types they like, across the digital platforms they individually prefer.

Inmar integration

One shopper insight that everyone knows is that shoppers in the checkout line don’t want to be delayed. Retailers are keenly aware of that, and they are particularly (and rightly) sensitive to the impact of any new technology at checkout that might slow things down. So the big hurdle that digital couponing has had to clear has been one of achieving a seamless and super-fast digital redemption when the paperless coupons are presented. No one wants to download a coupon offer to their loyalty card or unique identifier, then have to wait for an elaborate network to validate the coupon, in a setting where passing seconds feel like minutes. But the validation can’t be skipped, either, because coupon fraud can cost retailers millions. Inmar’s point of sale technology, developed by acquired company M-Dot achieves secure, accurate, real-time redemption by leveraging the speed and scalability of cloud technology. In fact, prior to Inmar’s acquisition, M-Dot was chosen as the winner of Amazon Web Services’ Startup Challenge. The solution is so scalable that it has been demonstrated to execute over a million concurrent transactions in a 10th of second.

More recently, Inmar built on that impressive back-end integration with a promising new front-end partnership. They recently announced a strategic relationship with NCR, one of the top Point Of Sale (POS) system providers for retail. The new offering will integrate Inmar’s digital coupon solution with NCR’s marketing and POS applications, providing retailers with a powerful new platform for quickly and easily planning and implementing digital coupon campaigns, offering paperless coupons to shoppers across multiple touchpoints … including mobile phones and tablets.

According to Mounts, “Retailers that ‘opt in’ will be able to introduce digital promotions into their marketing efforts with remarkable speed – and at minimal cost.”

It’s a win-win-win solution: shoppers get the added savings of digitally discovered coupons, without slowing down their checkout experience; retailers get an easy platform for implementing their digital coupon campaigns; and consumer goods manufacturers get a much more targeted delivery mechanism that can yield new insights in minutes.

Inmar involved

For all the technology focus, Inmar hasn’t lost sight of its ‘human goals’ either. Ever since opening shop in Winston-Salem, Inmar has remained true to its community, where it is one of the area’s major employers. This part of North Carolina has seen economic decline over the past decades with the erosion of three of its major industries – tobacco, textiles and furniture – the latter two primarily declining due to relocation of the industries to cheaper offshore markets. Inmar, by contrast, has stayed in the game locally, opening three different offices as headquarters for its coupon, product returns and pharmacy solutions groups. Supporting operations in the supply chain, health care, and coupon redemption networks occupy around 30 additional facilities across North America.


Now the company is upping its ante by consolidating all three local offices into a beautiful new complex in downtown Winston, with almost a quarter million square feet of modern office space, renovated from an old tobacco processing plant. Located on the edge of the Wake Forest Innovation Quarter, a cornerstone of the Renaissance of Winston-Salem, the new facility clearly underscores Inmar’s corporate social responsibility and its commitment to the local jobs it has created.

When Mounts says it all starts and ends with people, he clearly means it. – JTS

[i] Registered trademark of Intel Corporation

[ii] Registered trademark of BASF SE

New Valassis Survey Reveals Fresh Insights on Millennials’ Shopping Behaviors

In brand-building, mobile & tablets, retail, Shopper Marketing on September 13, 2013 at 3:00 pm

by Jeff Sandgren

This week Valassis released the results of its Sixth Annual RedPlum® Purse String Survey, to gain insight from today’s shoppers and learn more about their shopping behaviors – especially where and how they look for deals. The study, based on insights from more than 5,100 respondents, found something surprising about Millenials in particular: although they are more ardent digital devotees (no surprise there), they prefer good old paper coupons.

Lisa Reynolds, Valassis Vice President of Consumer Engagement

Lisa Reynolds, Valassis Vice President of Consumer Engagement

“The RedPlum Purse String Survey results are somewhat counter intuitive from what you might expect based on what we know about Millennials,” said Lisa Reynolds, Valassis Vice President of Consumer Engagement. “While they are heavy digital users, this group also embraces tried and true methods for savings, as much as any other age group … they area a true testament to the use of savings from both print and digital sources.”

Perhaps most surprisingly, 51 percent of Millenials indicated that print is their first choice for savings. Unlike other groups, they rely slightly more on in-store coupons and deals than retail circulars; but like other groups, their top four sources are newspaper, emails/coupon alerts, Internet searches and their mailbox.

We wanted to learn more, so we were fortunate enough to get some Q&A time with Lisa Reynolds. Here’s what she had to say.

BTN: Millennials are seen as being less brand loyal than other demographics.  What strategies do your most recent findings suggest for Retailers and CPGs to at least hold ‘share of wallet’ with this segment?

LR: When asked to self-identify as promotion sensitive, price conscious, brand loyal or time crunched, Millennials like all other respondents indicated they were promotion sensitive (69 percent  versus all respondents 75 percent). Given their desire to seek out savings from a variety of sources and the multitude of influencers along the path to purchase, retailers and CPGs must utilize an omni-channel approach, using not only digital but also print and in-store initiatives to reach this consumer.

BTN: You mention various vehicles for conveying offers – have you observed any correlation between offers types and conveyances?  i.e., what types of offers work best as retail circular deals versus mobile coupons?

LR: While we didn’t specifically ask a question correlating offer type, what we do know is that Millennials use their smartphones to a higher degree for savings and in a variety of ways. For example, 45 percent (compared to 24 percent all respondents) of Millennials accessed a coupon in an email on their smartphone; 38 percent downloaded a savings app (versus 21 percent of all respondents); and 36 percent compared deals on their phone (versus 20 percent overall). The RedPlum Purse String Survey also found that these promotion-sensitive Millennials are getting their savings the same way as all other consumers across age groups and income levels with 51 percent indicating newspaper is their first choice for savings.

BTN: You note several differences between Millennials and all age groups.  What trends are you observing in these gaps – are Millenials pulling away from the herd and becoming more distinctive in their behaviors over time, or are any other age groups (if so, which) becoming more like Millenials, closing those gaps?

LR: The RedPlum Purse String Survey confirmed Millennials’ penchant for all things digital. They are leading the way using more mobile coupons and using their smart phones to access a coupon in an email, a coupon code, compare deals and download a coupon to a loyalty card. These trends will continue. We also found some distinctions between the Haves (those with an income over $60,000) versus the Have-Nots (those with an income under $60,000). Haves spend about 10 percent less time looking for deals to achieve the same savings. Both use their savings for basic necessities; the Have-Nots to a higher degree (65 percent versus 52 percent for Haves). Next, the Haves use their savings on dining out while the Have-Nots put it toward paying down debt. As a result, besides groceries, the Haves are more interested in coupons and deals on dining out and entertainment.

BrandTech News View: Regardless of demographic, consumers embracing digital coupons still rely heavily on paper coupons. Wise retailers and brand marketers need to tightly integrate their omni-channel offers and messages to make sure they engage all consumers at the Zero Moment of Truth.

  • Computer Savvy Millennials Still Turn to the Newspaper for Their Coupons (
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Shopper engagement sounds like ‘war.’ It is.

In Apple, brand-building, retail, Shopper Marketing on August 21, 2013 at 4:29 pm

By Robert Liljenwall

Retail isn’t the same anymore.  Consumers are marching into their favorite retailer with their smartphones at the ready … these handy data companions are helping customers analyze retailer offerings and give focused advice on their shopping list where and when it’s not available from the retail shelf.  Shopper engagement is not managed by the retailer as much anymore as by the shopper, who is now in control.  Armed with new ‘shopping weapons’, today’s shoppers know exactly what they’re looking for. And if they don’t find what they want, they either move on or order online when they get home.  Shoppers are on the hunt, especially in these challenging economic times (and, yes, we know that recession was officially over in June 2009.)??????????????????????

It is not always ‘bad news’ that consumers are now empowered with more information than ever before.  Retailers and brand marketers who truly know their customers’ needs and wants are able to capitalize on the shopper desires.  And as Internet sales continue to rise in all sectors (e-commerce rose 18.4 percent through the first six months of 2013 compared to same period in 2012), we spent more than $64 billion online during the second quarter of this year according to the US Census Bureau, which tracks these things … an increase of 4.8 percent over same period in 2012 of total retail sales of $1.126 trillion for 2013 2Q.

So what does this all mean?  We know several things:  One out of four Americans work in retail services.  Retail sales is increasing … slowly at a rate of 0.09 percent for the second quarter, and, no, retail is not going away.  Also, we know that mobile commerce is not going to take over retail (projected that only 1 percent of total retail sales will be on mobile devices by 2016.) And according to latest consumer research, the average consumer uses 10.7 different sources to make a purchase decision.  It all doesn’t just happen in the store.  But we know that, too, don’t we?

But what is happening is that individual retailers are fighting to keep their customers happy and keep them buying “in-store.”  Best Buy is notable for its struggle against Amazon and was able to make a dent in their California market by forcing Amazon through legislation to pay sales tax, but is that enough?  Target kicked out Amazon Kindle products – each were tired of being “showrooms” for Amazon and its own products.

Enter POPAI – the Global Association for Marketing at Retail – which published their fourth edition this spring of “Marketing at Retail – Understanding, Influencing and Winning Today’s Shopper.”  POPAI itself has experienced a metamorphosis in its 76-year history – starting out as a vendor-driven point of purchase trade group attracting producers, retailers and brand marketers.  But as technology expanded across all fronts, POPAI today reflects the broad array of “interests” that serve the entire retail industry – both in-store and online.

Marketing At Retail

Marketing At Retail

In this 386-page text – the largest ever – you will certainly recognize the change in the retail and technology landscape.  New chapters on mobile commerce, social media, and technology advances and online integration with in-store merchandising.  You will find an expanded offering presented by 23 of the top professionals in marketing at retail.  This publication is also available on an e-Version.  You can order your copy at Hard copy sells for $39.95 and the e-Version for $35.95.

Starting in summer 2011, we found that in putting this publication together we wanted to have the most complete resource for everyone serving the retail industry – and subjects not previously covered such as mobile commerce and social media were going to play a major role.  Throughout the editing process, too, we were constantly updating the chapters because technology and new retail initiatives were coming into the industry and we wanted to insure our readers they had the latest.

We do recognize that retailers certainly know that their #1 goal is to gain customer insight.  Consumer behavior, as Dr. Dan Flint (University of Tennessee) points out, is changing as technology changes, because consumers now have more data available to them than ever before.  “They can make choices quicker and more accurately because they have current data at their fingertips.”  And the authors point out that retailers are learning how to provide better customer technology support inside their stores with Wi-Fi and local data points on what’s on sale and to guide them to their own personal shopping needs.

Speaking on behalf of the authors, I want to share with you one grand example of how stupid some major retailers can be.

I have a Macy’s revolving account and pay my monthly bill online.  When I made a ‘confirmed’ payment on my Macy app. via my iPhone, I noticed that the payment had not been subtracted from my account within a week’s time.  I called Macy’s only to learn from the Macy’s customer service rep that…”We’re sorry, but we’re finding that many payments made on the iPhone do not get recorded even though you receive a confirmation!”  “Well, is this new?”  “Oh, no, it’s been going on for some time.  We’re sorry.”

Sorry!!!  I couldn’t believe it. But wait … the nightmare continues … I went to make my payment online with my iMac, and then I can’t seem to get a confirmation, so I called customer service again. The Macy’s rep asks what kind of browser I am using.  “What do you mean?  I am using Safari.”  “Oh, sir, we don’t really support Apple.  Do you have a PC you can use?”  True story, so help me Steve Jobs.  Can you believe that a major retailer would allow this to happen?  My next purchases were with….guess who?  Amazon.  (We awarded Macy’s the Lemon Award for August.)

Retailers who don’t give the same kind of attention to detail and support that an Amazon gives to its customers is going to find defections growing.

Is there a ‘war’ going on?  You bet.  Retailers who understand the stakes are Disney, Costco, Trader Joe’s, Whole Foods, Starbucks, In & Out Burger, Nordstrom’s and Apple, of course.  They have their customers in focus – they have gained keen customer insight, which should be the goal of every brand marketer and retailer.  There are many great retailers who are embracing the “new, smarter shopper” and are eager to support them online and in-store with technology that enables them to easily get the ‘stuff’ they want.

Shoppers have more choices than ever … and when retailers make it difficult to do business with them … you lose them, perhaps forever. You have to win the shopper battles to win the war! – RJL

[Note: both editors of BrandTech News are also contributing authors to the POPAI textbook, and Robert Liljenwall is Co-Editor]

  • Innovations in Asian Shopper Technology
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  • Decoding the Offline Shopper with Location Metrics
  • Macy’s sales slip, says shoppers wary to spend
  • Look out retailers: Google Glass has a price comparison app!
  • America’s Economic Recovery At Risk As Consumers Start Pulling Back

A Day in the Life of Canadian Retail

In brand-building, Canada, retail, Shopper Marketing on August 21, 2013 at 2:32 pm

Challenges and Champions in Canadian Retail

by Jeff Sandgren

Dawn breaks over the eastern Maritimes, and the great economic engine of Canadian consumers revs up for another day.  Breakfasts and school lunchboxes, clothes and cosmetics—millions of consumer goods will all be synthesized into the activities and lives of thirty-five million Canadians.  Virtually every one of these items passed at some point through the vast enterprise of Canadian retail.

Happy Canada Day

Happy Canada Day (Photo credit: Anirudh Koul)

As Canadians awaken and prepare for their workday, one out of every eight will be heading to a job in retail; in the US, the retail sector employs about twice that proportion.  Yet while retail’s activity accounts for approximately six percent of Canada’s economy, the ratio in the US is triple that.  This significantly lighter saturation of the Canadian retail market, relative to that of the US, is one of the notable disparities luring the attention of US-based retailers to growth opportunities north of their border.

Powered by the engine of Canadian consumers—and by their annual shopping infusion of over $12,600 per capita (totaling over $450 billion)—Canadian retail was up before the dawn.  In fact, it never sleeps. Complex global supply chain networks source goods around the clock and around the world, as Canadian retailers—both domestic and foreign-based—constantly seek to better serve the changing tastes and escalating demands of the shoppers of Canada. Sophisticated retail technology systems ceaselessly churn through mountains of data. Retail merchants strive for the perfect assortment of goods, offered at the optimal price and promotion; while retail operators execute the merchants’ plans to ensure that all the right items are in the right places, each at the right time, with just the right number of retail store associates to deliver the ideal shopping experience.

One hour later, in the Eastern Time zone that stretches from the mouth of the St. Lawrence to the western bank of Lake Superior, dawn wakens the heart of the French Canadian market. The urban centers of Ottawa and Toronto comprise over 60% of the population of Canada, a large majority of whom live within 90 miles of the US border.   Fashionistas make plans for shopping trips in the apparel stores of Quebec and Montreal, where the latest styles from France, Europe, and around the world adorn the storefront windows.  The apparel tastes of the world are brought to these markets by merchants like Larry Rosen, Chairman and CEO of the Harry Rosen chain, founded by his father in 1954. Although his chain already accounts for 40 percent of the Canadian market in high-end menswear, Larry personally visits fashion centers around the world every year, immersing himself in the customers’ shopping experience there at clothiers large and small.  These days, Larry make his visits with his new iPhone in hand, having replaced his business-worthy Blackberry with the device that he finds helps him better identify with his target consumer.  Customer-centricity is a mission that never ends.

Local markets across the culturally diverse greater Toronto area serve up the particular tastes of their local enclaves.  The strategy that ethnic eateries, handbag boutiques and neighborhood booksellers have always known—that of being obsessively tuned to the tastes and experiences of their local clientele—now drives all of retail. Some have had to adapt, like Eleanor LeFave, whose bookstore, Mabel’s Fables, has recently countered the pressures of online and big box booksellers by finding new sales opportunities in wholesaling to school book fairs.  In the ceaselessly competitive world of retail, the courageous merchants who innovate and adapt to changing customers and competitors survive and thrive. Those that have failed to steer by the customers’ compass lose their way, and ultimately fall behind.

Sunrise in the eastern prairies shines each morning on one of the most notable sites of changing retail formats.  Portage Avenue in Winnipeg was once the home of “The Big Store”, Winnipeggers name for the then-giant Eaton’s, where in the 1960s they spent 50 cents of every shopping dollar (excluding groceries).  The store, however, was only a small part of the giant catalogue fulfillment centre which covered 21 acres and employed 8,000 workers.

As times changed and Canada’s population became increasingly urban, more and more consumers had local access to stores; by the mid-1970s over 60% of Canada’s suburban population lived within a thirty-minute drive of an Eaton’s store.  In January of 1976, Eaton’s announced their last catalogue, and a massive layoff.  A string of missteps over the next two decades culminated in filing for bankruptcy in 1997, acquisition of assets by Sears a few years later, and the eventual retirement in 2002 of one of the most iconic Canadian retail brands.  Today Portage and Main in Winnipeg features shopping malls connected by an underground concourse and the Winnipeg Skywalk—both measures taken against the location’s legendary (if unproven) status as the coldest and windiest intersection in Canada.

As morning reaches the western prairies in Alberta, another day’s preparations begin for the 23,000 employees who work at the West Edmonton Mall—with over 350,000 m² of leasable area, the largest mall in North America (the world’s largest until 2004).  In the mid 1990s this mall included two full Bay department stores, the second having been added when the chain took advantage of space vacated by the bankruptcy of Woodward’s.  Other retailers leaving at that time included Canadian Tire and IKEA, part of a trend towards ‘big box’ standalone properties; but the space was subsequently filled by T & T Supermarket.  Since then, new additions have included the first Victoria’s Secret in Canada (2010), and La Maison Simons’ first outlet outside of Quebec (2012).  Today there are over 800 stores and services offering world-class retail experiences to over 28 million visitors per year.

Finally, dawn lights up the Rockies and the westernmost Canadian urban center of Vancouver.   Here, as in many urban areas, fewer young people are getting driver’s licenses—healthier lifestyles, digital socializing, and online shopping are making personal automobiles less relevant as the Millennials move into the mainstream. Smart retailers are reading these winds of change, and finding opportunity there.

Mountain Equipment Co-Op, a pioneer in healthy lifestyle merchandising since its founding in Vancouver in 1971, was also an early innovator in multi-channel retailing.  In 2013 it won the Canada Post E-commerce award for Best Multi-Channel Retailer of the Year.  Lululemon began here in 1998, also with a focus on healthy living.  Its 4,500 “educators” (a.k.a. store associates) mentor customers—traditionally females, but now including male yoga enthusiasts—towards the benefits of healthy lifestyle (with, of course, the proper apparel) in over 200 stores.  In a model to which many retailers aspire, the focus of retailers like these on quality goods and a well-educated customer base are overcoming the traditional “race to the bottom” on price discounting, which has dragged down other low-cost-focused retailers.  It’s working: Lululemon is now expanding into the US, UK, and across the Pacific to Hong Kong, Australia and New Zealand. MEC has over 3 million members in Canada and internationally.

Meanwhile, in the global time zone of cyberspace, where the sun neither rises nor sets, retail is always open.  Retailers with strong e-commerce programs are continuously retuning or reinventing themselves.  Staples, voted the most trusted brand in Canada in 2008, and a top 10 most trusted brand ever since, just re-launched its already successful loyalty program, and plans to add another 200,000 items to its e-commerce site by the end of 2013.  In the world of consumer-driven retail, continuous improvement is now de rigueur.

The machines and merchandise of Canadian retail, with their planning and problem-solving, never sleep – because they dare not.  Because the retail and consumer goods sectors are as challenging as they are rewarding, and as brutally competitive as any industry.  Because shoppers today have more choices and knowledge of alternative sources, more access to product and price information, and more connection with the influence of their peers than was dreamed of even a decade ago.  The dynamics of Canadian retail are accelerating at an unprecedented pace – and retailers that are slow to keep up are thrown out of orbit. – JTS

  • Target arrival met by cautious shoppers as sales stumble
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Chicken soup ain’t good for the Apple soul

In Apple, Healthcare, Shopper Marketing on March 8, 2012 at 11:07 pm

by Robert Liljenwall

Samgyetang, a Korean chicken soup

Image via Wikipedia

Well, excitement filled the air again last week when I accidentally spilled chicken soup on my MacBook Pro while recovering from the flu.  A late 2009 model, my MacBook Pro was toast.  Gone.  Dead.  Logic board destroyed.  No matter how good chicken soup is for your soul, it’s absolutely not good for your laptop, Apple or not.

I had little time to decide – heading out for a 10-day trip back East in two days, it was now or never. And I soon discovered that sending my computer to the Apple hospital would take almost a week, and $1,240.  Soup cost me $1.99, laptop repair would be about the cost of a new computer.

Disgusted with my own stupidity and lack of dexterity, I looked around.  Surely in SteroidLand, there was a solution waiting for me.  Ah, ha, the MacBook Pro Air – sleeker, slicker, lighter, sexier, and actually, younger (a 2012 model vs. 2009).  And it only cost $9 more than my rehabbed three-year old sister.  After confirming that this was the right decision with two very helpful Apple customer service reps, it was a done deal.  And since I had recently put iCloud (via Lion) on my iPhone 4s, the migration was instantaneous:  I transferred my contact list, calendar, and over 20,000 emails instantly onto my new Air.

I was such a happy camper, and as I was walking out the store with my new Air under my arm, a young man was walking with me as we approached the front door.  I stopped and asked him:  “Did you buy anything?”  He answered, “No.”  “Well, you know, the alarm goes off if you don’t buy anything.”

For just a second I knew he thought I was serious.  He gave me a quizzical look, which quickly faded to relief and a broad grin as I was smiling, too.  “Naw, just kidding.”  He seemed relieved.  And I was relieved, too.  I was a very happy Apple camper, on steroids, again!

Let me see? A new iPhone 4s, a new Air in the past two months.  Yup, I’ve done my job of helping Apple this past quarter – along with millions of others around the Planet.  I just can’t leave an Apple store without buying something.    — RJL

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Walmart flexes muscle by moving into the neighborhood

In brand-building, Shopper Marketing on March 8, 2012 at 10:46 pm

by Robert Liljenwall

In the supermarket business, there is no bigger, badder brand than Walmart.  By a long way, Walmart is the world’s largest retailer in terms of total revenues ($446 billion), employees (2.1 million worldwide), and $206 billion market cap in the supermarket segment.  Not satisfied with its global power, Walmart is heading to a neighborhood near you with its new, smaller Neighborhood Market format, which will be about a third of the size of its regular Super Center stores – from 33,000 to 45,000 sq. ft., which is about the size of Best Buy.

English: A Wal-Mart Neighborhood Market in Win...

Image via Wikipedia

Why is this brand event significant? The down-sizing of Walmart’s traditional do-it-all format to fit into local neighborhoods spells trouble for the well-established supermarkets brands in Southern California where the company has targeted approximately 13 stores in the near future.  These stores will compete head-to-head with Ralph’s, Vons and Albertson (California’s ‘big three’) which are unionized – and Walmart isn’t.  And the company has picked a very smart strategy of avoiding ugly public fights with opposition of unions and local communities.


Most of us have always had the brand perception of Walmart as the ultimate downtown-killer, forcing thousands of local merchants throughout its dominant South and Midwest markets out of business, leaving many downtowns to antique stores and a few insurance companies.  That is the fear that many cities have, especially in Southern California which already has 28 Walmart stores in Los Angeles County.  According to their new strategy, this move into smaller markets will probably work because they have learned that the Walmart brand doesn’t always mean cities are hanging out their ‘Welcome To Our Town’ signs anymore.  Every city wants more business, more employment opportunities, but not at the expense of closing their downtowns.

If you haven’t been into the newer, refurbished Walmart Super Centers – you ought to visit, shop.  These stores are extremely well designed – still have wide aisles and great in-store fixturing and signage.  The signage is particularly helpful and dramatic, especially in the meat section.  I was impressed.  One thing you can count on: Walmart will not make the same mistakes that Tesco did with Fresh & Easy, a concept that has not caught on, especially in the Trader Joe’s sector.

Walmart appears to have a handle on its brand values – good and bad – and is making adjustments to expand and enhance their revenues, even at the expense of its competitors.  — RJL

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Virtual Assistant Cuts in Line at Duane Reade

In brand-building, Shopper Marketing on October 23, 2011 at 1:29 pm

by Jeff Sandgren, Technology Editor

Some brands have it tough right from the start.  Branded solutions that focus on situations we innately dislike, for example.  Take waiting in line.  We hate to wait. In today’s society we’re each of us much too busy (and far too important) to have to endure anything short of immediate service and gratification.  So waiting is a big negative.  By association, so are all the accoutrements of waiting.

Queue Management solutions seek to tame that beast.  The most familiar component to most of us is the systems of belts and stanchions that line everyone up into an orderly queue, like at airport security points.   It’s a love/hate affair, really.  You may not like the feeling of being “herded” by the retractable tension belts, but the alternative is much worse, with a pushing and shoving crowd in which the rudest and pushiest are rewarded with the shortest wait.  Let’s face it: the tension belts of queue management keep things civilized.

More recently, however, innovative companies have begun to look at this space as an opportunity not just for orderliness, but for engagement.  They’re going beyond tension barriers and take-a-number systems, and employing digital signage, and even holographic projections.

We spoke with Keith Carpentier, Senior Business Development Manager at Lawrence, a Tensator Group Company.    At this year’s GlobalShop, the leading industry trade event for marketing-at-retail solutions, Lawrence showed some bold solutions to change the user experience while waiting into something more informative, entertaining, and social.  Apparently, some innovative retailers took note.

“Our position in the industry historically was retractable tension belts,” Keith explained, “but at our show this year, there were very few tension barriers as part of our booth.  We made a very powerful technology statement around queuing, and around impulse purchase buying.”

“The main goal has always been to guide the customer.  But in today’s competitive world, the guidance part is just the foundation of the pyramid.  Layered on top of that – and what the retailers today are most interested in – is impulse purchase generation, reduction of ‘walk-away’ shoppers, and efficiency.”

Lawrence claims to have led retailers to success in treating the checkout and service queues as a ‘micro-environments’ within the store.  It’s not the Point of Sale, and it’s not the broad shop.  It’s unique, with its own dynamics.  “It’s now taking on a more digital persona,” suggests Keith.  “The newest generation of solutions improves the efficiency AND become a profit center.”

Tensator has studied the difference between Actual Wait versus Perceived Wait.  A big factor is whether the waiting guests have their attention occupied with something they find interesting.  An occupied wait always feels shorter than an unoccupied wait.  Witness the prayerful posture of the smartphone crowd in such situations.

The checkout queue is the moment when a shopper has made the decision to buy something and invested the time to make the purchase, so it seems to be an ideal moment to engage them.  Initially, in-queue signage has offered URLs of brand sites or brand social sites as suggestions for guests to browse and “Like”.  QR codes are part of the next iteration, to make it easier for guests to ‘leapfrog’ to their sites with a simple click of the phone’s camera.

“Right now Brands are testing, learning how to best utilize the space.  Retailers are working hard at staying relevant, especially with younger shoppers.  They are looking to leverage this space as part of the experience, creating custom content to drive the consumer to social media sites.  It’s a great way to gain additional consumer insights.”

The ‘Holy Grail of queuing’, according the Keith, has always been grocery. Within the past year, there has been a big uptick in the grocery category, which pundits used to feel was ‘off limits’.  This includes interest and pilot studies by big players like Safeway, Kroger, Giant Eagle, and H.E. Butt in Texas.

Chain Drug retailers are even further along.  “Six out of the top ten chain drug are working with us to adopt these innovations,” claimed Keith.  “And we’re especially proud of our latest, state-of-the-art installation at Duane Reade.”

This past July, Duane Reade, New York City’s largest drug store chain, held a grand opening of its Wall Street megastore in the Trump Building.  Prominently displayed is “the industry’s first Virtual Assistant”, a next-generation digital signage solution by Tensator that creates the illusion of a real person acting as a ‘Greeter’ to provide Duane Reade customers with a friendly hello, useful information, and brand and promotional messaging.

“Our Virtual Greeter is an essential part of the ‘wow factor’ we have built into our newest store, and serves as ambassador of the new Duane Reade customer experience,” said Paul Tiberio, Senior Vice President of Merchandising & Chief Marketing Officer for Duane Reade. “The virtual aspect captures shoppers’ attention from the moment they enter the store – engaging their visual and auditory senses. And because the Virtual Assistant is so compelling, shoppers are receptive to the wealth of information she provides.”

There’s a bit of a Wizard Of Oz parallel to the presentation in the visual impact of the image – along with the requisite “pay no attention …” implied relative to the rather large projection platform, but it’s a nice neutral grey that quickly disappears from the visual perception with only the brand imagery sticking to the memory (hopefully).  Besides, the Virtual Assistant is just so charming, who cares what’s behind the curtain?  See for yourself at

The size of the projection device also triggers in our price-sensitive minds the question of what this thing costs – or, more importantly, how the payback measures up.  Tensator is no stranger to these issues with their traditional product line, having done extensive studies of the reduced cost of “walk-aways”, consumers who were intending to purchase but abandoned their merchandise when dismayed by the perception of a checkout queue that was too daunting.  Tensator studies have allegedly found an 80-90% reduction of this costly phenomenon when queues are properly designed, managed, and equipped with engaging information for the shoppers.

In this case, the Return On Investment seems pretty clear: replacing the cost of a human greeter with one whom, as the website demo informs us, is “available 24 hours a day, seven days a week, never needs a break or vacation” and can say whatever messages you want in whatever language is required with total compliance and consistency.   Human resources like that don’t come free … certainly not on Wall Street.            -JTS

  • A Miracle Makeover at Duane Reade (
  • Check Out The Amazing Duane Reade Drugstore Specifically Catering To Wall Street (

A Snappy Approach to Mobile Advertising

In brand-building, mobile & tablets, Shopper Marketing on October 5, 2011 at 10:07 am

by Jeff Sandgren

Quiz: What innovative 2-D tag image solution was used in these advertising campaigns this summer?

  • Ocean Spray, in their cross-country mobile sampling tour
  • Toyota Motors’ ToyoTag, to “move the consumer closer to the transaction”
  • Gap, in Glamour Magazine (right on the cover, next to Rihanna’s … personality)
  • Office Depot’s nationwide back-to-school promotion offering $500,000 in mobile gift cards
  • Wrigley’s Orbit gum back-to-school in 100 million packages of gum
  • Bud Light’s “Ultimate Fan Experience” promotion
  • Casa Noble Tequila and Bar Louie restaurants offer chances at tickets to a Santana concert
  • Chivas Regal’s “Brotherhood” campaign

If you answered Quick Response (“QR”) Codes, or the more colorful Microsoft Tags, you’re wrong.  The correct answer is SnapTags, a solution offered by SpyderLynk, a mobile activation and marketing platform company.

This could be mobile marketing’s worst kept secret.  While Quick Response codes seem to dominate the news, and Microsoft Tags fight for a share of media attention, SpyderLynk continues to build up an ever-growing stable of successful campaigns.  And there are two good reasons why.

The first, from a brand point of view, is looks.  QR codes are functionally nifty, but they’re ugly … by design.  They were developed by the Denso Wave Company as a better way to track car parts, with more information than traditional ‘striped’ 1D barcodes.  Nicole Skogg, SpyderLynk’s Founder and CEO, is also the inventor of the SnapTag, which feat she performed before she’d even heard of a QR code, so the whole angle of approach is different, coming from a visual, brand-friendly starting point.  Where the visual appeal matters (e.g. Rihanna on Glamour), the choice of a simple, attractive logo with a surrounding circle, rather than the black and white QR checkerboard, has better brand appeal.

The second reason for SnapTag’s success, from an advertising effectiveness standpoint, is reach.  At issue is the question of how many cell phones are “feature phones” (cell phones with cameras) versus how many are “smart phones” (iPhones, Androids, etc.), which matters because SpyderLynk’s SnapTags work with both, so they simply cast a wider marketing net.  Two equally credible reports came up with different answers this summer.  Nielsen finds that 40% are smartphones vs. 60% feature phones.  The report from comScore found an even smaller slice for smartphones, at around 35%.  SnapTags can potentially be “read” by virtually all of these devices.

Smartphone adoption is growing, but the numbers for now still give feature phones the majority.  On top of that, comScore also found only 6.2% of mobile phone users actually scanned a QR code in the most recent test period.  Here in the US, camera phone users can use a service from another company, Scanlife, to send a photo of a QR code via MMS to a special number, where a server decodes it and sends back an SMS message with the web link or other info that the user can then input to get more content.  Did that sound too involved to you?  Precisely the point.

We spoke on two separate occasions with Nicole Skogg, SpyderLynk’s Founder/CEO and Jane McPherson, SpyderLynk’s CMO, who have had a great view of the development of this new solution over the past few years.  We wondered, would the trend in QR adoption make it easier or harder for SpyderLynk?

Jane prioritizes brand strategy over technology:  “The bigger questions should be, are brands really giving consumers a reason to use them?”

“There’s a bit of risk,” Jane explained.  “If everyone throws QR codes on everything without offering consumers value beyond a web connection, will it turn consumers off?  Right now there’s still a novelty factor, but marketers are going to have think more carefully about the best times, places, and ways to use mobile activation codes.  We try to focus our clients on really meeting a market need.”

According to Nicole, “We’re moving into a Marketing 3.0 landscape.  Consumer-driven conversations are the next phase, an ongoing, on-demand dialogue with the brand.  It’s about brands getting close to consumers, and to their decision-making process.”

Adoption by brand marketers has come in waves, according to Jane.  “Traditional advertising was the first big wave, then event marketing, now retailers.  We’re finding that shopper marketers are focusing more on purchase consideration, rather than just dropping brand and awareness.  Their focus is on helping consumers in making a purchasing decision.  HP is doing a good job of serving short videos to help them answer questions about products.  For Coors, sweepstakes still work, because that’s a high engagement brand.  It varies by product.”

An interesting example of on-package marketing with SnapTags is the recent work of Colorado Native, a brand of AC Golden (MillerCoors) that’s marketed locally in the Rocky Mountain state.  According to Jane, they put SnapTags on their bottles.  Participating consumers are first “age-gated”, then drawn into a back and forth dialogue with trivia, polling questions, and social networking.

“They are doing a great job of crafting campaigns that drive loyalty in the marketplace.  Colorado Native contributes a portion of all sales to a charity. Right now, if you snap and send (with your cell phone camera) the SnapTag engagement lets the consumer decide which charity.  Now the consumer feels connected.  Colorado Native has also become arbiters of event news.  So they ask via SnapTag conversations: what events do you care about?  Consumers choose the event, and they send out messages about the appropriate events.  Their SnapTag community is as big as or bigger than their Facebook community.”

SnapTags were also used to clever effect in DVD launches, like Warner Brothers’ “Inception” and Sony Pictures’ “This Is It”.  Ah, but show business has a way of drawing the unwary into its web.  Nicole’s innovations were recently honored by The Producers Guild of America, in association with Variety, who chose her as one of the 2011 “Digital 25” Leaders in Emerging Entertainment.  That puts her in the heady company of Lady Gaga.  We’ll be looking for her first SnapTag tattoo soon.  -JTS

  • Ocean Spray Taps SpyderLynk for Cross Country Mobile Tour Using SnapTags (
  • Q&A: Nicole Skogg, CEO of SpyderLynk: The Rise of Social Barcodes (
  • Could Social Snap Tags ever take on the ugly QR code? (
  • SpyderLynk CEO Nicole Skogg Named to Mobile Marketer “2011 Mobile Women to Watch” List (
  • Office Depot Engages Customers with First-of-its-Kind Mobile Back-to-School Promotion Created by Momentum Worldwide and Using SpyderLynk SnapTags (
  • Social SnapTags Direct Magazine Readers To Facebook (
  • Snap And Send For More Infomation From Toyota (And Many Others) (

Editor’s Note, March 2012:  We learned from a David Alex that there might be some name confusion.  In the completely-unrelated world of biological research, a Professor Kai Johnsson developed ‘novel tools to study protein functions’ and calls the technology a SNAP-tag.   Spyderlynk’s mobile marketing technology is called a SnapTag and enables marketers to offer consumers the opportunity to activate commerce, social, promotional and couponing campaigns from any location. Nicole Skogg, the founder of SpyderLynk invented and patented the SnapTag.  We are not sure she how much she knows about protein functions … but she is a wiz at mobile technologies and marketing platforms.  Thanks, David, for helping with disambiguation.

Into the Wonderland of Neurodesign

In neuromarketing, Shopper Marketing on May 20, 2011 at 3:37 pm

by Jeff Sandgren

Upon learning that NeuroFocus, a curious company that is busy gleaning insights from deep inside our skulls, had recently published findings from a study of the male brain, I thought it prudent to benchmark my male psyche.

It turned out to be a choice like that of Alice, curious to see where the rabbit was going, and stumbling inadvertently into Wonderland.  My simple initial curiosity was, am I a ‘normal’ guy?

“It all depends on what your spouse thinks of you,” cautioned the instantly disarming Dr. Pradeep, CEO and neuro marketing White Rabbit, “your estimate of your own normality can be overly exaggerated.”

Dr. Pradeep is a genial, energetic fellow, whose frequent humor provides comic relief from topics as heavy as brain-wave analysis.  Nevertheless, I decided to proceed with caution, since there were clues here that my wife might already have this guy on her payroll.  Better to leave the personal introspection aside, I thought, and focus on the more general applications, starting with: what, among all their neuro-discoveries, has been the most surprising so far?

According to the good doctor, they run into interesting insights all the time, nearly every day.  But there have been a few fundamental surprises.

Big Aha’s

“One big ‘aha’ concerns the over-sixty segment, and how we talk to them,” explained Dr. Pradeep.  “Their brains seem to almost always discard negative messaging.  There’s a difference between suggesting to an over-sixty person that
they should put their money where it’s safe (negative spin) versus suggesting that they put it where one day their grandchildren can have access to it (positive spin).”  The latter approach, according to this analysis, will likely be more effective.

Another ‘aha’ concerns the teen brain.  Since the different parts of their brain develop at different rates (the reasoning part of the brain develops more slowly than the emotional part of the brain), talking to teenagers should use the language of emotion, rather than the language of reason.

“I’m not just talking about marketing,” Dr. Pradeep added, “but about teaching and even parenting.  We might want to tell them they shouldn’t drink before they’re ready, that they should drive more carefully – what a frustrating exercise that is when we approach it based on rational arguments!”  He didn’t offer a positive alternative here (sorry, parents), but we assume it should be along the lines of “You know, getting a DUI or wrecking your car is SO awesomely uncool.”

So what about the male brain?  What’s the best way to talk to me?

Doctor Pradeep suggests that “… the cliché is to characterize the male brain has having a natural propensity to focus on scantily clad images; but that is an overly simplistic way of characterizing what is actually a more complex underlying emotional phenomenon.  We don’t tend to think of guys as emotional, so we talk to them in the language that grabs their attention.”

The doctor conjectured further.  “What if you understood the emotional territory that men’s brains occupy?  Then you could talk to them in the language that their brains are actually focused on, but do so with a certain emotional high ground.”

At this point in the interview, I abandoned the notion of selling this story to Cosmopolitan instead of using it in BrandTech News.  The notion that men’s brains have such a thing as “emotional high ground” might be too tough a sell.

So what about the female mind?  According to Dr. Pradeep, “It is only a crude and senseless man who would simplify the female mind.  The female mind is mysterious.”  And again, the contagious chuckle.

Seriously, there are insights being gained, and he promised that NeuroFocus will be revealing some big aha’s in the near future.  Dr. Pradeep did note that, while we (the royal Marketing We) seem to agree that there is a Trillion-Dollar Woman out there shopping, much of the marketing and message crafting still isn’t directed towards her, because it is still being created “… by guys, for guys.  We all give each other high fives about how wonderful we are, but too many times we aren’t targeting the decision maker in the language that is natural to their brains.”

Enabling Neuroscience

So how does all this mapping of our brain territory come about?  The enabling technology that NeuroFocus uses for their psycho-cartography is the well-established Electroencephalography (EEG); but not the gooey experience that most of us
envision, with greasy sensors stuck in your hair and a plethora of wires tethering you to the monitors.  Instead, NeuroFocus has developed Mynd™, the first ‘dry’[1] full-brain, wireless EEG apparatus.

The Mynd maps in great detail the parts of your brain that are active when you are sensing and considering various stimuli – without overlaying the subconscious stimuli of being tethered  by a mass of wires, or worrying about messy cleanup afterward.  Mynd effectively untethers the wearer, and the brainwaves it is capturing can be transmitted wirelessly to any Bluetooth-enabled device.

The real magic comes when this is coupled with pixel-level eye tracking, at a rate of two thousand times a second.  Test subjects can then be exposed to various packages, ads, images, messages, etc. while adorned with the NeuroFocus headgear.
A neuro-physiologist can observe in real time, and the ensuing data-stream can be analyzed and interpreted after the session.   The focus of NeuroFocus is on what they deem to be the three key parameters: attention, emotional engagement, and memory retention—because neuroscientists know what physical parts of the human brain correlate to those mental activities, and the EEG can reveal their activation.

But what about this Big Lurking Question:  was this neuroscience a creepy Orwellian invasion, or a way for Marketing to better understand and tailor the big wide world to little old you and me?

“Neuromarketing is just using science to understand what motivates us … and what makes us behave in certain ways,” the doctor assured me.

Focus on Retail

There are many applications for the findings of this research, so it’s not surprising that NeuroFocus has offices in such insight-hungry locations as New York, Hollywood, Cincinnati, Tokyo, London, and more.    The company is a world leader in the fast-growing neuromarketing research field, with numerous patents for its advanced technologies and a blue-chip client list representing the top companies in many Fortune 100 categories.

One solution area that is especially relevant to many of our readers is marketing to shoppers, online and in-store.  In fact, Dr. Pradeep is one of the Keynote Speakers at this year’s upcoming “Shopper Insights In  Action” ( ), along with such big names as A.G. Lafley, former CEO of Procter & Gamble, and Shopper Insights VP’s and Directors from Best Buy, Campbell Soup, Macy’s, Family Dollar, and GameStop.

Asking Dr. Pradeep about marketing at retail revs him up even more, like bumping an electron in the great atomic structure of neuroscience up to an even higher level.  But he isn’t just enthusiastic about it – he’s clearly vexed.

“There is your consumer, just a few feet away from your product.  There is your consumer, in your store, with money, ready to buy,” I could smell the ozone coming through the phone line, over a crackling high-pitched whirring sound that had nothing to do with bad reception. “What is the impact of marketing in that scenario, to a willing person with money in their pocket?  Hundreds of millions of dollars are spent sending messaging to the consumer on the couch, far, far away; yet brand marketers have difficulty justifying a few dollars more at retail.”

Doctor Pradeep suggests a new term, Storefront Marketing, to synthesize both the physical retail in-store environment and the online web storefronts (as distinct from webpages where goods are not being offered for sale), a very consumer-centric definition that defines a moment in time and space (or cyberspace) where a consumer is potentially on the verge of a purchase.

“You’ve done all your broadcast and print advertising, all your brand building, and now the consumer is right there at the point of purchase, eyeballing your merchandise.  How are you connecting with them?  What conversations are you replaying? Are you trying to start a brand new conversation?  Or do you think your previous marketing was so profound that you don’t need to converse with them again?

“Marketers aren’t connecting the dots at retail.  It’s about selective replaying, and that thinking hasn’t happened yet.  The brain of your consumer at retail, it’s the same brain you’ve been talking to.  What would happen now if you could selectively replay the key parts at that moment?  Neuroscience facilitates this by isolating these particularly evocative and memorable snippets.  These are what you need to give to your creative folks, so they can reactivate those snippets in the consumer’s mind and trigger a replay of thewhole story.”

We observed a common maxim of Storefront Marketing (by whatever other name you reference it): that you only have a few seconds of a consumer’s attention in which to engage them and draw them to your product or offer.

“That is precisely the point,” Dr. Pradeep replied.  “If only you could know at the point of purchase what was important to your consumer, and you could tastefully reactivate it, then the whole experience could be recreated in their mind, and you could have them engaged.”

Predictive Analytics

In addition to guiding the design of your Storefront Marketing, Dr. Pradeep believes that the combination of neuromarketing and predictive analytics can be especially effective.  And he had empirical evidence to back it up as his verbal tempo and tone hit the accelerator again.  “We did an experiment with a major client, in which we went back and looked at marketing with over two years of data, and applied to that history the predictions that our neuromarketing research would have made.  We wanted to see how our predictions correlated with real in-market performance.  In some scenarios, you might be very happy to find a 20 – 25% correlation of prediction with in-market results.  In our case, we found a correlation in excess of 80%.

“Imagine if you could know in advance how to make 80% of your ad budget effective.  What would you do?  How much better would your performance be?  What costs of wasted advertising could you save?  The predictive capabilities of these solutions are going to be phenomenal.”

Tapping the brakes just a bit, Dr. Pradeep noted, “Look, the whole truth of the human brain will remain forever unknown … but we can get closer and closer.  Purchase decisions are made at the brain, so the closer we are, the better our opportunities.”


Finally, we asked Dr. Pradeep for his view of the future of neuromarketing.   There was a rare pause.

“When someone markets to me, I want them to talk to me like I actually have thinking and feeling brain – like I am someone who is not fooled easily.  People want to be talked to in a way that shows respect, that evokes thoughtfulness and passion.

“When we look back from the future, I think the very term ‘neuromarketing’ will become an anachronism,” foretold Dr. Pradeep.  “I think the future is about neuro-design.  By better understanding the human brain, we can move up the chain beyond marketing, to truly designing for the consumer products and offers that will genuinely be of greater service and relevance.

“Look at all the dials and knobs and instructions we have to deal with today.  Who thought I’d want to have to learn all this stuff?  Think of neurodesign as if everything was designed by Apple.  Brand Apple takes the time to make sure their products are fit for human consumption.   We have agencies to decide if food is fit for human consumption, but not product interfaces.

“Marketing informed by neuroscience can do better.  It can improve how we speak to and engage consumers.  It can direct products and features that appeal to the human brain, pricing that is not confusing, promotions that actually make sense.”

In summary, Dr. Pradeep believes we need to “demolish the glibness of marketing, put science in its place, and migrate marketing to the loftier world of design.”

After the interview, I reflected that my initial impression of Dr. Pradeep was all wrong.  He wasn’t the White Rabbit.  Clearly, he was The Caterpillar.  My mind was full of smoky, intoxicating images of a future where the inner mysteries of my brain directed the world of product design and marketing with magical efficiency.  I half-stumbled outside for a breath of fresh air, but still felt a bit dizzy, so I sat for a moment at the base of our maple tree.

An unknown time later, my wife woke me with a gentle shake.

“What are you doing sleeping out here?” she asked, “and what were you dreaming about?  You kept saying ‘curiouser and curiouser’.”

Okay, so my estimate of my own normality may, in fact, be just slightly exaggerated.    JTS

Editors’ Note: for those who would like to go further on this topic, Dr. Pradeep has authored a book titled “The Buying Brain”(2010), a business book bestseller.

The Mynd headset does require a very tiny amount of hair conditioner to make contact with the scalp

Emo-Metrics and the New “Q”

In neuromarketing, Shopper Marketing on May 20, 2011 at 3:04 pm

by Jeff Sandgren

Never play poker with David Berman!  CEO of Affectiva, a rising star company in the world of neuromarketing, his team is developing innovations in affective computing to help understand how people feel in order to improve products and experiences.

Be especially careful if he offers to let you wear one of his ‘special’ wristbands. Just give him your money and get it over with, because your ability to bluff will be gone.

The wristband in question is the new Q™ Sensor, a product that was officially launched this month after having been tested with over a hundred beta clients over the past year.  The Q detects and records physiological signs of stress and excitement by measuring slight changes in the skin’s electrical conductivity. This measurement, called electrodermal activity or galvanic skin response[1], is a human response component of emotional reactions.  The Q Sensor senses this measure go up when you are feeling excitement, stress, fear, or engagement, and drop when you are bored or relaxing – and might therefore know whether you really are holding an inside straight, or just faking it.

As the insightful reader has already deduced, this technology wasn’t invented for anything like gambling.  The original prototypes were developed by the M.I.T. Media Lab’s Affective Computing group run by Professor Rosalind W. Picard.  Dr. Picard and Dr. Rana el Kaliouby originally began work together with National Science Foundation (NSF) funding to develop technologies to help people on the autism spectrum, as part of a commendable effort to improve communications for people in the autism spectrum who have trouble reading and processing emotions.  Beyond those benevolent beginnings, though, it is another opportunity, like EEG and eye-tracking (see “Neurodesign” article) for neuromarketers to explore another, more common human foible – our susceptibility to the stimulus of shopping.

The inventors specialize in a science known as ‘affective computing’, which means computing technologies that “sense and respond respectfully to human emotions”, according to Dr. Picard.  Additional tools in their bag of technology tricks include the Affdex™ facial recognition and chromatic cardio monitoring –more on these in a moment.

The core technology for the Q Sensor has been validated in peer-reviewed journals demonstrating the accuracy of the electrodermal activity sensors used on the wrist compared to FDA-approved electrodermal activity sensors wired to fingertips. The validation is especially important for scientific researchers who have been limited in the past to using wired sensors in lab settings.

While basic skin sensing techniques have been used for a century (i.e. in lie detectors); previous methods typically require electrodes, wires and a lab setting. Affectiva has expanded the range of possibilities by making a comfortable sensor the size of a wristwatch, freeing people to wear it during everyday activities outside a lab. The key experiential difference is that the wearer quickly and easily moves beyond any physical distraction of wearing a monitoring device, and the device  enables essentially unlimited mobility.  Researchers can measure real people doing real everyday activities.

Eschewing games of chance (with the certainty of losing), and hungry for more insights on how the science of marketing can penetrate the art of human decision-making, we spoke to a proud and excited David Berman on the day of Affectiva’s first commercial launch, version 1.0 of the Q, called the Q Curve because it is contoured to fit on your wrist with the comfort of a bracelet or watchband “… in a way that is highly resistant to motion artifacts.”  The next version, the Q Pod, will release in a different form later this year, allowing easier wearing by children or adults in alternate locations.

We started by wondering how the company came about.  Not surprisingly, given the altruistic inclinations of the scientists, these inventions almost didn’t see the light of commercialization.  According to Berman, the science spent almost ten years in the MIT Media Lab, funded by a National Science Foundation grant, and supported by a number of corporate sponsors.  As the solutions began to show more and more promise, the pressure from the sponsors to incorporate the  technology into commercial products grew also, until Dr. Picard and Dr. el Kaliouby finally turned to Media Lab Director Frank Moss for resolution.  His solution, akin to the one that created E-Ink Corporation (and subsequently, years later, the Kindle and Nook), was to create spin-off so that the scientists could realize their nobler endeavors. By scaling the technology in the commercial world, they can help make it accessible and affordable to non-profits and fund philanthropy programs. Affectiva was born.

Berman came on board about nine months later, a move to leverage his experience gearing up WebEx, where he was instrumental in implementing the software-as-a-service sales and marketing model that grew revenue by a factor of 100.  David is no stranger to the world of start-ups … or success.  He was President of Worldwide Sales and Services for the company that was recently acquired by Cisco.  “It turned out to be a technology that made peoples’ lives better, and allowed them to have a more effective meeting experience without having to hit the road,” said Berman of WebEx.  “In the same way, Affectiva is providing game-changing technologies to improve other human experiences.”

And there are other correlations of note.

“There’s a sort of correlation between monitoring autistic children and multi-tasking consumers,” explained Berman, “because in one way you’re using the same core technology to let people share emotion to communicate more effectively.”

There’s good reason for Affectiva’s choice of the first two solutions.  The Q is designed to measure arousal, but by itself it doesn’t report whether that arousal is negative or positive.  This coordinate on the emotional map, which Affectiva refers to as ‘valence’, is captured instead by their other upcoming solution, the Affdex facial expression monitoring system.  By combining the inputs of how strongly I am responding to my environment and stimuli, together with the sentiment analysis of whether I do or don’t like a particular arousal, researchers can get a clearer picture of my location on my internal emotional map.

Affdex builds on the work of Paul Ekman, a psychologist who developed the Facial Action Coding System (FACS) to taxonomize every human facial expression.  The doctors automated many of the key elements of this code into a video analysis platform, thus enabling the software to report on the likely emotions of people whose facial expressions are being captured by a video recorder or webcam.

Avoiding Groupon’s Super Bowl Ad Flop

“The neat thing about the Affdex platform,” said Berman “is that you can monitor real time emotion at scale.  Let’s say Groupon had tried this by testing their intended Super Bowl ad (in case you missed the Antibuzz, it was a colossal failure by almost any account).  If they had sent out a trial version of the ad to a few thousand internet viewers who opted in with their webcams on, they could have known up front that people wouldn’t approve of an ad poking fun at culturally endangered Tibetans.”

Readers with webcams are encouraged follow up this newsletter by trying the technology themselves.  Simply click on, enable your webcam, and watch a few commercials.  As you’ll see, the software will detect whether or not you smiled – and this is just one simple example of a much broader range of emotional expression interpretation in the platforms capabilities.  It got me right on all three attempts.

As David pointed out, the potential is more than just ‘flop avoidance’.  Marketers could use this to monitor on an ongoing basis whether web content was “getting stale”, or even as a trigger for interaction, by using the emotional read to choose the timing and content for a particular call to action.

“We’re doing a lot of integration work with some of the larger ad measurement companies,” he revealed, “and really building out the platform ahead of the product launch.  Plus, we’re really having a lot of fun!”

“We’re starting with measuring media, but there’s a whole next wave of interaction that this technology enables.”

Regarding privacy concerns, Affectiva “takes the highest road” and is 100% opt-in.   All research participants are volunteers.  “If you make people’s life better, we believe they’ll opt-in.  They key is making sure they get enough value out the experience. At the end of the day, measuring customer experience means consumers will get a better product or more tailored solution.”

Speaking for the editors, we’d LOVE to know what people are thinking when the read our blog at .

Another example for our readers in the retail space is the MIT Mood Meter, where a deployment of cameras around the MIT campus counts smiles to determine the general sentiment of students, faculty and visitors.  See , and imagine having that insight, that easily about your shoppers.

What about the mysterious third solution?  A little further out, Affectiva is developing a solution that monitors blood circulation by detecting tiny variances in skin tone, as another way of measuring arousal without any worn hardware.  We’ll let you know when news breaks on that.

Early Learning at IPG Shopper Sciences

We were able to connect with one of the earliest users in the consumer goods space, John Ross, CEO of Mediabrands Shopper Sciences, who is using Affectiva and other solutions to gather data as people shop, improve the shopping experience, and create more value for customers.

Interpublic Group, as readers probably know, is one of the giant media companies with agencies around the world.  To serve the broad array of customer needs regarding shopper marketing, they decided a few years ago to build dedicated lab space, the IPG Media Lab, starting with one in Los Angeles.  The New York Lab is scheduled to open in the fall.  Charter clients included Microsoft, Sony, Johnson & Johnson, Bayer, Kohl’s, and Home Depot.

“One important consideration,” Ross told us, “was to facilitate a place where learning and pure research could take place with teams that were NOT necessarily attached to a client, allowing us to advise all our clients more objectively.”

“When the lab identifies trends, products spin out of that,” said Ross “and Shopper Sciences is an example.  In this world where the shopper is so informed, so powerful, we need a new toolset to understand shoppers and the decisions they make.

“Most of the marketing world focuses on consumption, on consumers.  They look a brand awareness, brand consumption, brand tracking.  Retailers focus on transactions like register logs and ecommerce reports.  What’s left in the middle is
WHY – why shoppers behave as they do.”

Shopper Sciences’ tool set include such lofty elements as ‘purchase barrier matrices’, ‘neural shopping matrices’, ‘physical response diagnostics’, and proprietary tools to score point of purchase materials, all to get a better handle on how  shoppers make decisions.

Clearly, it’s a perfect environment for Affectiva solutions.  Ross saw them as a tool set that would allow them to bring a quantitative measurement to emotional decision-making.  A big plus, according to Ross, was that the form factor enabled a methodology that could be readily scaled for retail.

“The form factor was so elegant that it fades into the background,” complimented Ross.  “This is important because shoppers tend to answer surveys smarter than they behave; they under-report the emotional side of their decision-making.  These tools give us better insights to what they’re really feeling.”

Shopper insights versus Buyer insights

Ross cited, as an example, a recent study of young women cosmetics shoppers.  A major brand client was concerned about representation in stores, and wanted to better understand shopper behavior.  Using the Q Sensor, they were able to determine that women were engaged and confident when picking the first product, but then became more stressed when they tried to find additional cosmetics in suitable colors. As a result, very few kept the same brand across the various cosmetics.

With these insights, the brand and retailer are developing improvements to reengineer the shopper experience by making it easier for shoppers to match colors in-category.

“We’re bringing the emotional state of the shopper into the ‘fix the sales’ process,” says Ross.  “Presupposing that the shopper isn’t emotional does them a disservice. What looks like rote behavior by shoppers often isn’t.  Shoppers bring in a burden of worry, concerns, and need for education.  These new techniques allow us the scale to reveal the ‘micro-moments’ when the shopper becomes distressed or disengaged.”

As brands and retailers seek to improve  consumer experience (and their own performance), there seems to be a clear need to go beyond ‘Buyer Insights’, which only assess what people actually bought, into the more transient realm of ‘Shopper Insights’, looking at what’s going on inside the minds of those who are on the verge of making a purchase decision.

“We have all this data and agency reporting on buyers,” agrees Ross, “but the data on the poor shopper is so thin by comparison, that it gets lost in the strategic decision-making process.  We’re on the cusp of bringing the voice of the shopper into the process, and we believe this will transform retail. ”

The voice of the shopper, the internal voice that captures both rational and emotional elements, is perhaps the compass by which our consumer-driven economy can recover its direction.  Ground breaking research at the intersection of branding and technology is pointing the way.   JTS

The Q Sensor also measures temperature and 3-axis motion for additional
contextual interpretation of user state


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