Sorry, Retailers–Cyber Monday’s Days Are Numbered

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From my Forbes.com blog The New Persuaders:

Not long after Cyber Monday was invented in 2005 as an online alternative to Black Friday, I called it a “marketing myth” because it was actually not even close to a top holiday shopping day.

Then a funny thing happened–Cyber Monday, created by the National Retail Foundation’s Shop.org online unit, became a self-fulfilling prophecy as retailers jumped on the term and began offering special sales that day after the Thanksgiving holiday. By the following year, it had turned into a real phenomenon, at least for many retailers, and last year it became the heaviest shopping day ever to date. It might even happen again this year.

But now, even as many retailers have made Cyber Monday sales a stock part of their holiday strategy, I’m betting its days are numbered. Why?

* Early sales. Smart retailers noticed that before Cyber Monday, at least (and perhaps still), the period leading up to the big day actually were even more active shopping days. And in their never-ending attempt to get a step ahead of rivals, many retailers ran not just pre-Cyber Monday sales, but pre-Black Friday sales as early as the evening before Thanksgiving. Apparently they worked. They almost certainly will cannibalize Cyber Monday sales. …

Read the complete post at The New Persuaders.

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Facebook’s New Gift Service: Nice, But Not Yet An E-Commerce Game Changer

From my Forbes.com blog The New Persuaders:

Just in time for prime gift-giving holidays like Friday’s World Rabies Day (or if you prefer, Ask A Stupid Question Day), Facebook today launched a social gift service. It’s rolling out to only a select few for now.

I must be one of them, because I was able to send something to my wife to try it out. But in its current form, I doubt I’m going to use it much.

This isn’t the 2.0 version of the Facebook Gifts virtual-gift service that the company shut down two years ago, by the way. In fact, the new Gifts is built upon, and run by, the folks at Karma, the gift-giving service Facebook acquired in May.

It actually looks pretty good. And while I have ordered precisely one gift that obviously has not yet been delivered, so I can’t judge the entire gift-giving process, it worked quite smoothly. I clicked on my wife’s Timeline, clicked the gift button, and off I went to order her some caramels. She can even pick her own flavor–that’s pretty cool.

In this case, I obviously know her address, so one advantage of Facebook Gifts–not having to know or ask for someone’s address–is moot in my case. What’s more, I didn’t get an automatic reminder I might get if it were her birthday, so that bit of friction elimination wasn’t a factor for me either. But it’s fast and easy to send gifts to friends, and that’s great–not just for consumers, but for Facebook, which can use a service that brings in revenues not dependent upon its brand of advertising that many large marketers are still doubtful about.

So what isn’t great, at least for me?

* A lot of the most prominent gifts are pretty vanilla–teddy bears, spa appointments, flowers, cupcakes. Maybe they’re fine products. Maybe they’re the sort of thing most people give their friends. But for a service with a tagline “real friends, real gifts,” too many of these products seem just too impersonal. Products, especially gifts, are not necessarily fungible, and all the less so for close friends for whom you’re supposed to be getting something special. And if they’re not close friends–and let’s be honest, most people don’t have several hundred close friends–I probably won’t be sending them many gifts, from Facebook or anywhere else. …

Read the complete post at The New Persuaders.

Facebook To Start Charging Businesses To Run Offers

From my Forbes.com blog The New Persuaders:

After launching Offers several months ago, Facebook now is switching the retail and local merchant deals service into money-making mode.

The No. 1 social network, under pressure to prove that it can juice revenue growth to justify its $50 billion-plus valuation, said today that it will require merchants to buy at least $5 worth of ads in order for their offers to appear in  the newsfeeds of their target audiences and their friends. The amount businesses are required to pay for these ads, specifically Page Post ads, will vary depending on the size of their Facebook pages.

Facebook also has added several new features to Offers. For one, they’re available worldwide to all Pages with more than 400 fans. Also, merchants can add a bar code to an Offer so they can track results more easily, as well as potentially run Offers on their e-commerce sites.

Facebook says the changes, in particular the requirement that merchants spend money, should produce Offers that consumers view as higher-quality and more relevant because businesses will be incented to make those offers better if they’re paying for them. The changes also position Offers more squarely against incumbents Groupon and LivingSocial.

Facebook isn’t providing much in the way of numbers on how Offers are doing except for one example: It says the ARIA resort in Las Vegas booked more than 1,500 nights, producing a return of five times its investment from running Offers.

Although many of the new ad and commerce initiatives Facebook has been rolling out no doubt were planned well before its May initial public offering, the company has introduced a flurry of new ad formats lately. Facebook’s share price had fallen by half from the IPO, thanks to concerns by investors about whether its ads are catching on fast enough, especially on mobile devices.

What’s Google’s Marissa Mayer Up To?

We haven’t heard much from Marissa Mayer, one of Google’s highest-profile executives, since she left her longtime job as vice president of search products last October to become vice president of location and local services. Some saw that as a demotion, though it’s clear that Google is putting an especially heavy emphasis on local commerce and advertising. So, hoping she will reveal a bit more of what she has been and will be doing in the red-hot local e-commerce and ad markets, I’ll be watching Mayer’s fireside chat with Mike Arrington at the TechCrunch Disrupt conference in New York today. Here’s what she has to say:

Q: What’s Google like now with Larry Page as CEO? Mayer: Google’s always been focused on the user, and Larry even more so. The other thing that’s happened is we had projects that started small like Chrome and Android that are now large. There’s a lot of optimism. A lot of energy.

Q: Is it good for competition and the industry that there’s Facebook, Bing, and other significant competitors? Mayer: It causes everyone to work that much harder and get that much better.

Q: What are you doing now? Mayer: I’m VP of Maps and Local (guess her title has changed a bit?).

Q: Is Google scraping other sites’ content for its Place pages? Mayer: People expect results to be comprehensive. So we want to get people really good data when they search for local information. It’s really meant to be a directory. There’s not enough information there to make a decision… so you go to the reviews and other sites.

Q: Is Google going to show only its own reviews once it gets enough of them? Mayer: Today we aren’t getting a lot of [our own] long-form reviews. (So I guess not, for a while at least).

Q: What are Google brands that matter going forward? There’s so many, I’m confused. Mayer: We’re really trying to streamline that. Not as many separate brands like Hotpot, etc. There’s Maps and there’s Local. Maps is the geospatial location and it should be personalized. Places is the local side of it, the textual and descriptive side. Those are really the two big pillars in this space.

Q: How are things going on the mobile side? Mayer: Great. We just crossed the 200 million installs on Google Maps for Local. About 40% of our traffic for Maps is mobile. More on the weekends, could cross permanently in June.

Q: What’s your goal to be successful in the next year? Mayer: Get you places you want to go or didn’t know you want to go. Enhancing our data. On the very far reaches, I’m starting to look at contextual discovery: Can we figure out from your context just the right information you’re likely to want without searching for it. Like if you walk into a restaurant that your friend went to last week, maybe you could see what they ordered.

Q: What are you personally investing in besides Square and One Kings Lane? Mayer: Also Minted, Gene Security Network. I’ve been active as an angel for a little while. It’s fun. I love watching how companies go through the growth phase, and helping them get through that. I’m not on Angel List or anything like that.

And that’s it. Well, not much there, sorry to say. You’ll get more on what Mayer and Google are planning for the local market here.

Offermatic Takes On Groupon With Automated Deals

Like a lot of people, I’ve been taken a little aback by the incredible success of Groupon, the deal-a-day site that Google recently offered $6 billion to buy–only to be rejected last week, for pete’s sake. Estimates of annual sales, all thanks to the 50% cut it takes from deals offered daily by local merchants around the U.S., range from $500 million to an almost unbelievable $2 billion (and indeed that is believable only if it’s gross revenues, of which Groupon gets half or less).

For all that, no small number of people have questioned various aspects of Groupon’s business, from wondering if it’s a fad to asking whether merchants ultimately will find the deals profitable enough to continue. A new deal service launching today from Sunnyvale-based startup Offermatic provides some potential answers to those limitations–while raising some questions of its own.

I can’t really offer a better description of Offermatic than the one Mike Arrington at TechCrunch provided last May, when Offermatic began beta testing: It’s the freak love child of Mint (the online finance tracking service now owned by Intuit), Blippy (a service where you post your purchases to the world), and Groupon. So for example, if you spend $75 at Home Depot one month, you might get a $20-off coupon from Lowe’s–deposited automatically in your credit-card account. More details from Offermatic: Continue reading

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