Take a look at how digital transformation is helping leading retailers all over Canada. This includes Canadian Tire’s $400 million drive to shift gears as a clicks-and-bricks retailer. Loblaws PC Plus program and much more.

CMO digital cover made by ITWC

Online sales, mobile traffic expected to rise this holiday season: Adobe

Eric Emin Wood Eric Emin Wood Published: 10/27/2016

It’s going to be another jolly holiday season for Canada’s online retailers, according to the latest holiday shopping predictions by Adobe Systems Inc.

The company’s Digital Insights division expects Canadians to spend around $5.6 billion online between Nov. 1 and Dec. 31 this year, a 12 per cent gain over last year – and nearly half their browsing will be through a mobile device.

However, the signs point to Canadians preferring window shopping on their mobile devices to actually buying products on them, Adobe Digital Insights manager Becky Tasker tells ITBusiness.ca, with mobile devices expected to account for 28 per cent of Canadian holiday sales (18 per cent on smartphones, 10 per cent on tablets).

Moreover, when shoppers do purchase items on their mobile devices they typically costs less than items purchased via desktop or notebook, she says.

Adobe Digital Insights manager Becky Tasker
Adobe Digital Insights manager Becky Tasker believes Canadian retailers can learn a great deal from Adobe’s latest online holiday shopping predictions.

“From a business perspective, retailers need to identify what’s causing this behaviour and how can they make up for the monetary gap,” Tasker says. “One recommendation I’ve been giving is to not only focus on mobile optimization – which will improve the experience for everybody – but to also think about cross-device integration: the sort of technology that can allow a customer to jump between their smartphone, tablet, and desktop in an integrated, cohesive way.”

While the bulk of Adobe’s research covers the U.S. market, Tasker says much of the information is relevant for Canadian retailers as well.

For example, as in the U.S., “Black Friday,” which this year will fall on Nov. 25, kicks off Canada’s holiday shopping season and is expected to be the second-most profitable day for online retailers – next to Cyber Monday, when Adobe expects Canadian retailers to pocket more than $200 million in online revenue, three times their usual rate of sales.


Meanwhile, Adobe expects online holiday sales in the U.S. to grow at a slightly lower rate than last year – 11 per cent year-over-year, versus last year’s 12.7 – an expected drop that can teach Canadian retailers a lesson as well, Tasker says, since as online holiday sales continue to rise, it becomes harder for them to grow at higher rates.

“There isn’t necessarily anything bad about it, it just seems like the growth is getting more isolated and competitive with so many players on the market today,” she says, emphasizing that, more than anything, the reduced growth rate represents an opportunity for retailers to differentiate themselves in other ways, such as by offering a superior customer experience.

“When we asked consumers why they shop online, obviously good deals and free shipping and great bargains were part of it, but we also saw this insurgence of convenience factors,” Tasker says. “Not having to wait in line, or wait in traffic, a greater variety of products or product availability.”

The retailers who best pay attention to these convenience factors and emphasize their skill at meeting them – while continuing to offer competitive prices – will be the ones in the strongest position to attract higher sales and repeat visitors, she says.

“Even though they’re not as big as cost savings, customers are starting to show that they’re willing to pay a bit more of a premium to go online,” Tasker says.

Handful of products driving growth at the top

Another trend the Digital Insights team noticed was that a large percentage of year-over-year growth came towards the end of the holiday season, rather the beginning, with five per cent growth during the first two weeks and 24 per cent growth at the end of December.

There are several tactics retailers can deploy to take advantage of this opportunity, Tasker says, such as discount offers that require consumers to “clip and collect,” or reduced prices for delayed shipping – or, for procrastinators, expedited shipping.

“The level of growth we saw at the end of the holiday season indicates an area of opportunity that’s a little more untapped than the unsaturated earlier part,” she says. “A website or retail company could easily promote last-minute shopping to procrastinators, encouraging them to complete that purchase and finish their holiday shopping.”

Finally, Adobe’s predictions confirm that the holidays exacerbate an unfortunate reality of retail – that a very small percentage of items drive the majority of sales. In the U.S., Adobe found that only one per cent of products drive 74 per cent of online sales during the holidays (versus 63 per cent on average).

Among the products that Adobe expects to drive holiday sales this year, based on social media buzz: Lego sets; Hot Wheels; Nerf products; video game systems including the Playstation 4, XBox One, and Nintendo DS (but not the Wii U); Pokémon Sun and Moon; and toys based on TV shows Paw Patrol, Skylanders, and perennial Disney phenomenon Frozen.

To compile the U.S. version of the report, Adobe’s Digital Insights team measured 80 per cent of all online transactions from the top 100 U.S. retailers on an ongoing basis, ultimately covering 1 trillion visits to more than 4500 retail websites and 55 million stock keeping units (that is, items for sale); analyzed 75 million social mentions between September 2015 and December 2015, and between August 2016 and September 2016; and conducted a companion survey of more than 1,000 U.S. consumers.

Canadian predictions were compiled from 6 billion visits to Canadian retailers.

In the past, Adobe’s predictions have proven to be accurate within two percentage points of actual sales.

Consumers still prefer using cash to buy – for now: Payments Canada

Eric Emin Wood Eric Emin Wood Published: 11/17/2016

Cash continues to be the preferred method of payment for the majority of Canadians, but its popularity isn’t worth much.

According to Payments Canada’s latest “Canadian Payment Methods and Trends” report, released Thursday, the total value of Canada’s cash transactions is a drop in the bucket compared to other payment types, and it’s losing ground fast to various electronic, card-based, and online transactions.

“As payment methods and channels continue to evolve in the POS [point-of-sale] and remote environments, bringing about new payment options, it is important to remember that users have already demonstrated a high drive towards ever faster and more convenient transactions,” authors Michael Tompkins and Viktoria Galociova, both members of Payments Canada’s research unit, wrote in the report.

Overall, the organization found that while cash represented 32.4 per cent of all payments conducted last year, those payments represented only 1.3 per cent of the total value of money exchanged. Even the volume of cash payments has declined by nearly a third since 2008, Tompkins and Galociova wrote.

By contrast the most valuable payment category, cheques and paper, represented 44.7 per cent of the total value of money exchanged, despite representing only 4.2 per cent of payments. This is because while fewer cheques are being written, they’re for increasingly higher amounts – in fact, the average cheque’s value grew by 10 per cent between 2014 and 2015, to more than $46,000, the researchers wrote.

Courtesy Payments Canada

Payments Canada, which owns and operates Canada’s payment clearing and settlement infrastructure, including systems, bylaws, rules, and standards, analyzed 20.9 billion transactions, worth more than $8.9 trillion, to produce the report.

Online and electronic payments growing

Of course, if you’d been following breakthroughs in contactless, mobile, and online payment methods over the past half-decade, you’d expect to see more growth in digital platforms – and you’d be right.

The volume of online transfers grew by 47 per cent between 2014 and 2015, the highest rate of growth among the methods analyzed, even if they only represented 0.6 per cent of all transactions and 0.5 per cent of their total value.

Prepaid, debit, and credit cards are also driving electronic payment growth, Tompkins and Galociova wrote, with debit payment volume growing by 5.5 per cent and credit card payment volume growing by 5.3 per cent. The researchers attributed the latter to convenience and rewards programs, citing Ipsos Reid data that indicates 82 per cent of credit card holders receive rewards from their primary credit card, and that 50 per cent of cardholders use their primary card because it offers rewards.

Meanwhile, Canadians have increased their monthly use of credit cards by 21 per cent, while lowering their average balance by 12 per cent, indicating they used their credit cards for convenience rather than borrowing purposes, the researchers noted. More of us are paying off our monthly credit card balances too – 68 per cent in 2015, versus 55 per cent in 2011.

Finally, electronic funds transfer (EFT) payments represent not only the second-most valuable payment method (by a thin margin) but one of the fastest-growing methods by volume, expanding by an average of five per cent in volume and more than eight per cent in value every year since 2008, Tompkins and Galociova wrote, making it very close to passing cheque and paper items as the largest single segment of transaction value.

Other highlights from the report:

  • Canadians conducted an estimated 120 million online transactions worth $45 billion last year.
  • Since 2011, the volume of cheque and paper items has decreased by 25 per cent, while ABM transactions have decreased by about 20 per cent.
  • Cash use has also declined by 20 per cent since 2011, and it has the lowest average payment size – $17.50 per transaction.
  • Credit cards are now used in 58 per cent of all POS transactions.
  • Contactless payments grew by 70 per cent, both in volume and value of transactions, 2015.
  • While cheque use continues to decline overall, their value has actually grown by more than two per cent on average every year since 2008.

You can check out the full report here.

Salesforce outlines 4 ways brands can thrill the connected customer

Gary Hilson Gary Hilson Published: 11/16/2016

New research puts customers in the driver’s seat when it comes to determining which companies lead in the digital age.

According to a new Salesforce.com report, “The State of the Connected Customer,” 62 per cent of Canadians agree technology is redefining their behavior as a consumer, and 61 per cent feel significantly more empowered than they did five years ago.

They also expect businesses to quickly adapt to these changing preferences, otherwise they’ll simply switch brands: According to the report, 69 per cent of consumers agree technology makes it easier than ever before to take their business elsewhere because it empowers them to research, browse, and purchase wherever they are and whenever they want.

Given the reality of the connected customer, Salesforce used the report to outline four ways companies can pivot to be successful, rather than risk being disrupted.

Place customers at the centre of your business

First and foremost, businesses need to place customers at the centre of their business, as digital conversations can make or break brands, and customers have “boundless” access to online content that drives decisions, Salesforce found. Nearly half – 48 per cent – of respondents believe social media has given consumers more power, and 70 per cent are more likely to purchase products that have positive online consumer ratings.

Embrace immediacy

Brands must also embrace the culture of immediacy, Salesforce found, as 63 per cent of consumers expect companies to respond and interact with them in real time. Mobile plays a critical role in the on-demand world as well, since customers expect companies to participate in the culture of immediacy through instant mobile service and access to information: 48 per cent said it’s absolutely critical or very important that companies have an easy-to-use mobile experience.

Personalize, personalize

Another expectation is personalization: Customers want to be treated like people, not numbers so while connected customers are technology entrenched they are still looking for personal relationships with companies. Brands need to get smart about personalization as 62 per cent say they’re likely to switch brands if they’re treated like a number instead of an individual.

The research shows that the connected customers expect consistent and intelligent experiences across every interaction or communication channel, and being recognized and remembered is a large part of that. Ultimately, familiarity at every touchpoint defines brand commitment, and 64 per cent of respondents strongly agree or agree they expect companies to provide a consistent experience wherever they engage with them.

Know thy product

Finally, not only do brands need to know their customer, sales representatives need to know their own products and services inside and out.

To ensure that’s the case, The State of the Connected Customer recommends that brands reinvent the sales process, as savvy customers expect made-to-measure sales experiences, rather than sales pitches. They expect to be helped and informed by the company sales team: 81 per cent say it’s absolutely critical or very important to work with a salesperson who focuses on achieving their needs instead of making a quick sale, while 82 per cent say it’s very important to work with a salesperson who doesn’t try to sell products they don’t need.

Overall, the spirit of the report seems to be a tried and true business tenet: Value your customers or perish. Only now you must do it much faster and better.

Five proven tactics to help turn web traffic into successful leads

Sean Jimenez Sean Jimenez Published: 10/20/2016

Web traffic is always nice. But you might have a tough time if you can’t convert your traffic into quality leads. So how do you maximize your conversion rate online, especially as a B2B venture?

Years of doing business to business has taught me that one must go above and beyond to educate and provide valuable content to the right audience. If you can’t first narrow down your target audience, you’re wasting valuable time and marketing dollars.

After you’ve locked down your target audience, you have to get them to your site, make them want to stay and ultimately come back for more. The higher your Customer Lifetime Value – or the net profit you can generate from your entire future relationship with a customer, the more successful your online venture will be long-term.

Now let’s assume you have a respectable website up and running and are ready for some serious Conversion Rate Optimization (CRO) – but don’t know where to start. Don’t fret. Follow these 5 simple tips and you will be well on your way to successfully driving in, converting, and retaining leads.

1) Learn from the best, takeaway from the rest

See what your competition is doing right in the online marketplace, how they present themselves and what opportunities exist for you to make what they’re doing better. You’re likely going to be sharing the market with your competition for a while, so you may as well make the most of it.

Perform a detailed audit of their website, conduct a usability test, and use your competitors’ sites as a benchmark for your own to make it as easy as possible for your target audience to find what they are looking for. This is also a great opportunity to look at industry leaders’ sites and leverage key success points from the best.

2) Create great content – and do it regularly

You may have heard the old saying “content is king.” As cheesy as that sounds, it’s entirely true. The key to building your reputation online lies in the quality of the content you produce. In order to present yourself as an expert in your industry, you must look and act the part.

The best content on the web normally shares three common traits. Nail all of these consistently, and you won’t go wrong:

  • Great content has a positive outlook;
  • Great content evokes high emotions; and
  • Most importantly, the best content is practical and useful.

I am amazed at how many companies out there are producing mediocre or even poor content. If you have the money, it pays to hire a good content writer or technical writer. If not, there are plenty of sites where you can hire experienced freelance writers for your short-term projects.

A good first impression stems from quality content that is both unique and informative. Helpful content will not only drive more shares and quality backlinks, but it will also earn you valuable referral traffic. And the more consistently you post quality content, the better your reputation will be.

3) Leverage testimonials & case studies

As humans, we tend to conform to the successful actions of others with the expectation that we can achieve equal or greater success. This is why the inclusion of testimonials and case studies as social proof can add to your reputation and conversion chances.

If you’re a start-up or are relatively new in your industry, try asking for referrals from past business partners or clients that you’ve worked with in the past. It’s better to have something tangible on your site from a trustworthy source than to forego it and lose prospective leads over a lack of visible reputation. When prospects are out shopping for something they have to commit to, they want to see results.

4) Be so good they can’t ignore you

Regardless of what you do, be amazing at it. Provide an outstanding product or service experience that make people want to buy from you. Because let’s face it – there is too much competition out there from companies that all sell basically the same thing.

As much as I hate to say it, people are lazy and don’t want to constantly be switching from one brand or company to another. Oftentimes, they will pick someone they can trust and stay with them for the long haul.

By standing out and inspiring mutual trust with both current and prospective clients, you will leave them with no better option than to choose your product or service. The best part is, by earning their trust, they will make your job easier because you won’t need to go out and find new business – business will come to you.

5) Put the “lead” in thought leadership – become an influencer

This is easier said than done (and it takes some time) but here’s a quick tip: narrow down your niche and become a specialist. It’s a lot easier to drive conversation in something that you live, breathe and die for than it is to become a jack-of-all-trades and only be able to offer a shallow opinion in industry conversations. By becoming an influencer you will instill trust with other professionals in your industry and ultimately, you will be sought out as an expert. In the words of the great Neil Patel, you’re driving leads through thought leadership.


In order to be successful in a competitive online marketplace, you must put yourself in front of your audience and show that you can be trusted to deliver powerful, positive and practical content consistently. If you already have a great product or service and a respectable web presence, you’re halfway there. The other half lies in your ability to promote yourself to the right audience by participating and leading the way in industry conversations.

Use these tips in ways that are appropriate to your business and you will be well on your way to converting more traffic into reputable leads that will be the foundation of your business for years to come.

Number of digital coupons issued likely to exceed 360 billion by 2021, Juniper says

Eric Emin Wood Eric Emin Wood Published: 10/24/2016

Long after Groupon’s heyday, the number of digital coupons being issued is higher than you might think – and it keeps going up.

In fact, thanks to retailers’ commitment to providing a personalized experience, the number of digital coupons released every year is likely to grow by 60 per cent over the next five years, from nearly 225 billion in 2016 to more than 360 billion by 2021, according to a new report by Hampshire, U.K.-based tech research firm Juniper Research Ltd.

“As retail becomes an ever more connected experience, brands and retailers are increasingly seeking to extend their engagement with consumers, moving beyond creating awareness and facilitating payment, to a deeper and richer integration of loyalty programs,” author Lauren Foye writes in the report, which was released on Oct. 24.

“This in turn has seen digital coupons evolve from being [a] means of driving consumers to storefronts to being a core element of promoting and reinforcing brand loyalty,” she writes.

Simply put, thanks to a mix of social media, loyalty programs, beacons, and chatbots, retailers can – and do – provide customers with a greater volume of coupons than ever before, Foye writes, citing examples such as Apple Inc., which uses its iBeacon platform to regularly transmit packets of data that can be picked up by smartphones, and ride sharing giant Uber, which through its Local Offers program gives customers one loyalty point for every dollar spent on merchandise at participating stores.

Though each channel is powerful on its own, they’re best used in tandem, she writes. After all, certain customers prefer receiving SMS messages over email, while others favour in-app delivery.

“Juniper believes that the key is not to only provide coupons via the most popular channel, but instead to offer consumers choice, as needs and desires vary,” Foye writes.

This proliferation of multi-platform content then contributes to retailers’ personalization efforts. For example, as each consumer brings their loyalty cards from one retailer to another, marketers can quickly build a profile of their habits and preferences, making it easier for companies to ensure their latest offering is tailored to that user’s needs.

Such technology can also help companies target users while they’re in the vicinity of their favourite brands, Foye writes, helping drive impulse purchases. For example, Major League Baseball (MLB) uses in-stadium beacons to share game highlights, team information, and deals on merchandise and refreshments with fans.

Readers interested in learning more can download the report, after creating a user profile, from Juniper’s website.

Cisco embraces behaviour analytics with new marketing strategy

Paolo Del Nibletto Paolo Del Nibletto Published: 11/14/2016
Cisco Systems senior vice president and CMO Karen Walker looks forward to adding behaviour analytics to the company's marketing strategy.

SAN FRANCISCO – Cisco Systems Inc. wants to switch up its marketing game and is embarking on a digital-first strategy that will add behaviour analytics to its lead generation strategy, its CMO says.

According to Cisco CMO Karen Walker, most business buyers are making their buying decisions online, with at least 67 per cent of buyers following a “digital” buying process.

“Customers are now a step ahead of the call centre,” she says. “They are self-educated and are telling you what they want or are interested in.”

In the past year, the San Jose, Calif.-based networking and telecommunications vendor delivered approximately $6.6 billion in the pipeline for partners using the leads it created, she says. But going forward, those leads need to step up their game.

Walker’s team plans to put more behaviour analytics-based channel marketing programs in place to provide its partner base with more valuable – what she calls BANT – leads. She believes this effort will help partners make faster and more accurate business decisions.

What are BANT leads?

BANT stands for Budget, Authority, Need and Timeline. With a BANT lead a potential customer has indicated they have Budget available, the Authority to make a decision or is the right decision maker in the sales process, Need (his or her company has an IT problem and are in need of a solution you are proposing) and the “T” is for time frame or the potential customer has a time frame in place for solving their problem and are ready to making a purchasing decision.

Cisco’s marketing push will work to provide channel partners with, as Walker describes it, customer insights in a deep data drive. For example, Walker’s team wants to inform channel partners on a potential customer’s share of their company’s wallet and propensity to buy, and help them better target certain market segments. She believes with this data, channel partners can properly invest in the Cisco technology solutions necessary for success.

“We’ll have data around the individual with names, demographics and personal interests,” she says. “As an example, we found out security buyers got a thing for Halloween and I think it’s that fine line between good and evil when it comes to security.”

“Listen, we are not going to launch a zombie campaign, but all joking aside we plan on delivering a rich set of data about human beings inside the security spend and we are going to do it digitally,” Walker adds.

Walker, who is responsible for Cisco’s global marketing and corporate communications, is specific when it comes to her strategy for channel partners. The focus is on security, and her marketing drive will put a lot of emphasis on the fact that Cisco is serious about security.

“Security is connected to networking so we are bringing security into Cisco’s main brand,” she says.

From day one channel partners should look for Cisco supplying solution providers with content and other marketing assets such as videos, banners and social media to enable them to tell their own story. And according to Walker, this is a first for the networking giant.

Demand generation will be another part of Walker’s all-digital marketing strategy. Cisco will be doing demand generation in two ways: marketing assets will help to drive a solution provider’s own marketing campaigns and secondly Cisco is boosting investment in its demand generation engine by 25 per cent. Cisco is also going to provide the channel with access to Cisco digital marketing agencies for things such as paid search campaigns and Web design.

“We want to both educate and teach marketing to the channel. It’s like teaching them how to fish instead of just giving it to them,” Walker says.

Besides digital, the marketing push will also be highly mobile. Look for Cisco to build local versions of its Web site Cisco.com in bite size portions.

“We have to completely redesign our content for digital and mobile consumption,” she says.

Work still needs to be done in Cisco’s new digital marketing journey. Walker tells ITBusiness.ca the goal is to be completely digital in its go-to market strategy, but have that intertwined with sales.

“We will play a much higher value role now because the customer will already know based on their online knowledge,” she says.

TubeMogul acquisition a natural fit for Adobe, experts say

Eric Emin Wood Eric Emin Wood Published: 11/15/2016
TubeMogul CEO Brett Wilson speaks at 2015's TubeMogul University conference in Lake Tahoe, Calif. (Courtesy TubeMogul)

Though ad spending on digital video remains dwarfed by ad spending on TV, the former is growing much more quickly, and by acquiring one of the sector’s emerging leaders, Adobe Systems Inc. is making a smart move, according to the experts at Constellation Research.

With mobile devices especially seen as an increasingly effective channel for digital video advertising, incorporating multi-channel programmatic video platform TubeMogul into its signature Marketing Cloud offering can only enhance Adobe’s value for CMOs and marketers, Constellation Research vice-president and principal analyst Cindy Zhou told ITBusiness.ca.

“YouTube alone reported a year-over-year rise in mobile video consumption of more than 100 per cent last year,” Zhou said. “By integrating TubeMogul into Marketing Cloud – and specifically their Media Optimizer and Primetime solutions – Adobe will be able to help more companies and ad agencies optimize their ad buying by providing the tools they need to divide their audience with greater granularity, before choosing the right channel to target the right segment.”

Both Adobe and TubeMogul announced the $540 million USD acquisition on their respective websites last week.

In a Nov. 10 blog post, TubeMogul CEO Brett Wilson called the acquisition “a great move” for his company’s clients.

“This will be the industry’s first independent end-to-end video advertising platform,” he wrote. “Current TubeMogul clients can envision a future where first-party data and measurement from Audience Manager and Adobe Analytics is available directly in TubeMogul’s platform — a combined data and buying dynamo that spans TV and digital formats.”

“Once integrated, (Adobe and TubeMogul) will enable brands and agencies to plan, buy, measure and optimize their global video advertising with a neutral, independent partner that doesn’t have direct ownership of media or content,” he continued. “Our combined incentive is to arm marketers with insights on what’s working — and act on it.”

Meanwhile, Adobe executive Brad Rencher admitted in a Nov. 10 interview with the Wall Street Journal that while video is the fastest-growing segment in advertising, it isn’t one the company addresses today.

The TubeMogul acquisition will solve that problem by extending Marketing Cloud’s capabilities, Rencher, an executive vice president and general manager of Adobe’s digital marketing division, said.

“We have a long history in video,” he told the Journal. “With the marketing cloud we’re now helping not only create video experiences, but also helping marketers deliver that content to all devices.”

Like Wilson, who will continue to lead TubeMogul under Adobe’s digital marketing wing, Rencer also noted that Adobe’s independence from the media business will make it a more attractive partner for brands and advertisers than some of its competitors. That compatibility was a key reason Wilson embraced the merger, the Journal reported.

In a Nov. 10 blog post, Constellation Insights managing editor Chris Kanaracus noted that by purchasing TubeMogul, Adobe was creating the industry’s first end-to-end independent advertising and data management solution that will span both TV and digital formats, simplifying what has been a complex and fragmented process.

“While today, total digital video advertising spending is about one-fourth that of television ads, digital video ad spend is growing much more quickly, at double-digit rates,” he wrote.

The two companies also share many customers, Kanaracus noted, including Allstate, Johnson & Johnson, Kraft, Liberty Mutual, Nickelodeon and Southwest Airlines.

If there’s a downside to the deal, it’s that it’s unclear whether Adobe will continue its new division’s fight against Google Inc., which TubeMogul has argued engages in unfair practices that make it difficult to use third-party tools to buy ads through Google, Kanaracus wrote.

Though TubeMogul made its initial public offering at $7 USD per share in in 2014 and once reached a high of $23 USD per share, the company’s stock had been volatile before the merger. It closed at $7.67 USD per share on Nov. 9, the day before the acquisition was announced, with Adobe ultimately paying $14 USD per share.

Antoine Azar’s Thirdshelf unlocks the power of marketing automation for independent retailers

Brian Jackson Brian Jackson Published: 11/16/2016

One of Antoine Azar’s favourite moments comes when he sees the light bulb click on in the head of his customer, usually some time around when the co-founder and chief technology officer of Thirdshelf helps them realize how much more money they’re going to make.

“It’s a huge eye-opener when they see the data they could be having,” he says. “It changes the way they look at their business.”

Started by three co-founders in mid-2015, Thirdshelf is a loyalty marketing solution made for small, independent retailers. Its customer tracking capabilities, paired with artificial intelligence (AI) that automates many aspects of customer relationship building, is the Ingenious Award winner in the SMB mid-market solution category for 2016. Azar, who nominated his own firm, says winning is a huge recognition that reflects his own business mission.

“It’s not technology for the sake of technology, it’s to help retailers,” he says. “We’re extremely passionate about helping people grow their business and be successful.”

Etiket a fan

That’s a sentiment that Simon Tooley, founder and CEO of Etiket – an early customer of ThirdShelf – agrees with. He founded Etiket after years of working at a larger retailer and was looking for an “innovative solution” to replace the analytics, loyalty, and marketing automation he enjoyed there, but for his smaller venture.

“It’s great to see people passionate about what they do being recognized for building innovative solutions,” Tooley says. “Showing the level of care and dedication that they Thirdshelf team has always demonstrated.”

The award from the Information Technology Association of Canada (ITAC) is hardly the only validation that Thirdshelf has received. Earlier in 2016, Azar and his two other co-founders raised an angel funding round of $800,000 to scale their technology and find customers.

New opportunity for smaller retailers born

Azar, a computer engineer by education, first saw the opportunity for serving the independent retail market at a previous business he ran, an agency developing mobile apps. While his agency catered to large customers, conversations he had with smaller retailers revealed there was no good technology to help them develop a loyalty relationship with their customers.

“We figured out the right solutions was an AI engine that could analyze the data and do marketing actions on their behalf,” he says.

Today, Thirdshelf has about 250 retailers using its platform to manage 300,000 customers in loyalty programs and the firm has grown to 15 employees. Given that there are 1 million independent retailers in the North American market, Azar sees room to grow.

Here’s how the software works – Thirdshelf connects with a retailer’s Point of Sales (POS) system such as LightSpeed, Vend, or Springboard. From there, it can analyze the transactions happening and start to identify first-time customers and return customers. Certain retailers have dutifully collected information about their customers already, and that can be input to help build customer profiles.

The trio of Thirdshelf founders.
The trio of Thirdshelf founders.

Making retail customer-centric

If customers of the retailer opt-in to the loyalty program – usually incentivized to do so by a rewards system that would include discounts on future purchases – Thirdshelf can analyze their purchasing patterns and design a personalized promotion for that customer. The software can also attribute actions to transactions, so retailers know if their marketing efforts are working.

“Retail has traditionally been very inventory-centric,” Azar says. “Every retailer should be customer-centric and we’re able to give you exactly that.”

At Etiket, Tooley says Thirdshelf does help shift the focus from inventory to customers. His team measures each action it takes with the solution to learn what works and what doesn’t – and for the most part, it’s working.

“We’ve evaluated that each dollar we invest in the platform has generated $14 in revenue,” he says. “Our customers also love the program, which means they keep coming back to see us.”

While retailers rely on Thirdshelf to run their loyalty programs, its operated as a white label product and invisible to the retail customers. The more data from customers that ThirdShelf can collect, the better it gets at helping out with marketing. That comes thanks to Azar’s machine learning algorithms. He’s been working with PhD holder Laurent Charlin from the University of Toronto on machine learning research, and the research duo have even won a grant from the federal government.

The power of the platform

“It also has vertical specific knowledge, so if you’re opening a bike shop tomorrow, you don’t necessarily have all the business insights about how to run promotions… but our system has that built in,” Azar says.

Thirdshelf’s goals are to collect 75 per cent of a retailer’s customer data and reactivate 10 per cent of dormant customers, as well as increasing second purchases by 25 per cent and increasing overall purchase frequency.

When working with one of his earliest customers, Azar recalls a “moment of truth” for his business. His customer was calling, saying that he felt like he was working with Thirdshelf, but unsure if it was generating more revenue or helping customers. Azar responded by working with him to develop a campaign based on the customer segments identified by the software.

“He generated an incredible amount of money in a couple of days,” Azar says. “He saw the power of the platform.”

In other words, you could see the light bulb clicking on.

ITWC is a media partner with ITAC for the Ingenious Awards.

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Brad McBride, VP Sales, bmcbride@itwc.ca, 416.290.0240, ext. 354
Desere Cowin, Senior Account Executive, dcowin@itwc.ca, 416.290.0240, ext. 174

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