The holidays are here, and as the kids bask in the joys of vacation, many businesses are deep into the final throes of business planning. Scrambling to figure out sales projections, headcount and more can make the end of the year an exercise in anxiety about what is happening next year. Here is my look at what is happening in 2012:
- It Is Going to Hurt to Be an Offline Retailer: e-Commerce has been here for over a decade, and it has just started to capture some significant share. Reports show e-commerce somewhere between 7-12% of total retail sales. But guess what? Retail generally counts autos…and e-commerce is just a freckle there. Taking out auto, e-comrce has a much higher percentage of the stuff that you already buy. From computers to televisions to shoes to furniture, e-commerce is having a significant effect on the way that offline retail operates. Amazon killed Borders (besides what they didn’t do to themselves), and e-commerce is on its way to killing other soft offline retailers (read about Sears closing stores). And with more and more online retailers maximizing logistic efficiencies to minimize delivery time (like Amazon Prime and ShopRunner), the “disadvantage” of online shopping begins to disappear. 2012 will be even harder on offline retailers because their primary advantage of proximity and “service” will begin to fall away at an accelerated rate. Look for a fair number of broad-based retailers to report store closings and depressed earning, even as the economy recovers a touch. There are just cost disadvantages to owning and stocking a retail store that will become harder to overcome. I suspect that retailers who aren’t deeply web-integrated (like Ross and Marshalls) will have a tougher 2012.
- Social Finds It’s Place: Social media has been all the marketing rage. We’ve moved to a time where Facebook is larger than all but the biggest countries. Twitter is expanding like crazy. And then there’s…uhhhh. Well, there have got to be other social networks that work. (Linked In is great for professional stuff, but I wouldn’t call it social.) Social has found its place. It is on Facebook. And Facebook is an amazing platform for developers and companies to build small interactive experiences that scale massively. Social interaction is NOT an indication of desire to buy, or an indication that customers will evangelize on your behalf. Social media is about awareness, about reminding your customers that you love them and are interested in their experiences. It is not a direct response channel, it is not a primaryacquisition channel and it is not an affiliate program. But rather, it is all of those. It is about the impressions that you leave. It is about the way that your treat customers. It is about the way that you share with your customers. Think of it like your logo, or your retail store layout, or the way your business card looks. None of these things really drive sales alone. But they go towards creating an image, an emotion, an experience. And that drives sales. Social will be realized as a crucial element of branding and customer service.
- Mobile and Web Become 1: The days of the web as a distinct development process apart from mobile are numbered. Mobile and web are becoming the same experience. HTML 5 development can make sites device agnostic. A well-programmed site will present itself well to users of smartphones and tablets. There may be some tweaking that is done to maximize your presentation on particular devices, but the choice to build or not build a mobile experience will be moot. Your website will be your mobile experience. Tablet commerce is here. Mobile commerce is here. Your team must master the essential elements of these presentations because that is e-commerce. As much as your team spends tweaking your website, they will be tweaking it even more to insure that the user experience is fluid on laptop, smartphone and tablet. This starts out with a device agnostic approach to user experience and development processes. If you have not started this process, or are considering hiring mobile experts to make a mobile site, start deeper, closer to the source. Website, mobile, tablet is a new trinity. Not to be worshiped, mind you, but they should be considered, developed and maintained as one.
- SEO Becomes More (and Less) Important: SEO is the marketing channel that makes marketers crazy. It is a source of delicious, free traffic. But at the same time, the marketer’s presentation and position is at the whim of a secret algorithm. But SEO remains a crucial part of the online marketer’s arsenal. And as search continues to grow, and consumer expectations around search grow (I just Googled and discovered which Arlington gas stations were open on Christmas Day through search. It was a stupid and arcane query, but Google found that answer for me in their first result…nice) having a powerful presentation in search has never been more important. Hence the reason why SEO is more important. There is more traffic to be won than ever. SEO is less important because the search engines get better and better and results become more and more personalized. There are fewer “tricks” that work in SEO. SEO has become an exercise in creating clear messages on well-coded pages. SEO has become about creating quality content that answers questions. SEO is less about the bits and the bytes and more about creating information that is useful. Seems like a good outcome to me.
- Paid Search and Organic Search Become Close Cousins: Adam Audette of RKG has a terrific primer of SEO/SEM integration. And Google will not ever mix the algorithms…that would require them to backtrack on 15 years of discussion around this topic. They will not cross that divide. But in order to help create a good user experience (and to generate more revenue) the techniques that drive clicks will become closer. For instance, the metric Quality Score of a paid search landing page will expand beyond that of obvious performance, and involve elements of SEO scoring (as evidenced, minimally, by the inclusion of landing page meta-data in the paid search experience). Think of it this way…although the algorithms of paid search and natural search are different, the results are converging. Google’s definition of a good organic listing and a high quality paid search landing page are becoming more similar. And as this happens, we see that Google is hiding lots of keyword data from organic searches and not paid listings. Further, organic search results take up less and less room on the search result page. The end result? Google essentially directs the marketer to engage well and deeply into paid search to get at consumer behavior data, and with the disappearance of a fair portion of Google organic search data, Google is telling folks to keep their meddling hands off of their organic search results. So, the enterprising marketer will take a “whole search” approach, using data from paid and organic search to make the best possible search presentation. My response: It’s about time.
- The Video Battleground Becomes Less Crowded: It is going to boil down to You Tube, Netflix, HBO Go, Amazon and cable streaming to mobile. Hulu falls apart. Vimeo becomes less and less relevant, and live streaming of sports takes off.
- Music Consolidation Happens: I have satellite radio, Spotify, Pandora, iTunes, and I could have rdio, rhapsody and a billion others… It will take a while, but satellite dies a painful death. iTunes works its way towards a subscription model. Spotify and its pals are just so compelling. Why buy music regularly if I can just rent it forever? There is no economic model on the resale of owned music files, so rental works. We all stream all the time. Including terrestrial radio. Apps like “IHeartradio” mean that there is no reason for local radio to exist. Terrestrial radio diminishes increasingly over the next 12 months. Not a good time time to own Clear Channel or any other radio network…
- E-Mail Declines as a Communication Tool: Asynchronous communication has always been inadequate. While there is some magic in a thoughtful correspondence, my inbox is besieged with marketing and spam. There are marvelously few conversations that are meaningful. This high noise to signal ration (it has got to be 50:1 noise to signal) means that I pay less attention to e-mail. My wife and I text more often than e-mail, and FB messages are more likely to catch me than an e-mail. The era of e-mail as a primary point of engagement are dwindling. And commercial e-mails will begin to dramatically underperform unless they become personalized and intimate. If they are more noise, then they will stop being useful. Listen up e-mailers…change or die. And you will die faster than the direct mailers do/did. You will fail faster…
- Catalogers Are Under Seige: From postal rate increases, skyrocketing paper costs, postal service cuts, and aggressive personalization from both on and offline retailers, the cataloger faces very difficult times. We keep the recycle bin near the mailbox…and we are not alone. The infinite shelf of online and the immediacy of the in-store experience make the catalog old news. Catalogers need to leverage the tablet, and the web, as fast as possible. If you aren’t, your key-responding demographics will be getting older and older, and less and less consumption-oriented.
- The Occupy Movement Makes a Comeback: Occupy become Moveon.org. Sadly, Occupy will devolve into NPR-like fundraisers, until an agenda evolves. Then they become the Tea Party of 2012 (political activists that revolve around a common set of goals, not conservatives…).
- Obama Wins Re-election in a Landslide: Not wishful thinking on my part, but even as the GOP seems to coalesce around Romney as of this writing, they don’t believe that he really is one of them. Resources turn from the White House to Congress and the partisan stalemate becomes even worse. GOP will win in 2016, falsely benefiting from a torrid economic rebound starting in late 2014. Washington gridlock will be worse than ever previously experienced, and I will be in a rage.
- 2012 Will Be Amazing: Not so crazy, this prediction, but between solar paint and the discovery of Goldilocks planets, 2012 will herald amazing new scientific discoveries that will excite everyone. We have been in a bit of “been there done that” with regard to things that we discover. But 2012 will be a year that we discover something truly incredible? Biggs Hoson? Evidence of bacterial life on other planets? A cure for a major disease? Something is coming. I can just feel it.
Happy New Year!