Category Archives: Retail

e-commerce – it’s crowded out there …

shopping malls

In the world of e-commerce, it can be difficult to become known, seen or heard, particularly if you’re an SME without deep pockets to spend on the marketing machine.  There’s so much activity in the digital world that, as a customer, it’s a little like going down a high street with rows of shops that are thousands deep and thousands of storeys high, each offering different goods – and somehow you have to find what you want without a map.

This means that helping your customers find you has never been more important.  Whether it’s PR or celebrity endorsement, e-mail or TV, the need for publicity and marketing through multiple channels is an increasingly essential element for businesses in the world of e-commerce.

A friend of mine had seven siblings – and, as a child, getting the attention of one of her parents when they were all together at mealtimes could be tough.  Her tactics ranged from shouting to crying to getting up and quietly speaking directly into an ear.

Which is just like marketing.  Broadcast, social media, PR and advertising all offer an opportunity to be heard by your target market – if they’re listening.  But sometimes it can be helpful to deliver a personal or private message directly into the ear of the individual you are targeting.  That’s what direct marketing is about – whether it’s email, direct mail, telephone or social.  And it’s even more powerful if used in combination with an awareness-generating channel in the first place so that there’s recognition when the direct marketing message is received.

For me, that’s the challenge and fun of multi-channel marketing – using all the relevant resources available to get your message across, and making the message relevant to specific individuals.  And with the sheer volume and detail of data available now, there’s no real reason not to do an exceptional job of identifying, understanding, targeting and reaching your customers with appropriate messages and offers.

Even better, you can actually measure the results and see how wisely you’ve spent your budget – an essential part of planning your next campaign.

In our marketing and data consultancy, Tuffill Verner Associates, we have helped businesses generate awareness and sales both on and offline.  With over 30 years experience we provide results-driven, data-led, clear, tailored practical and creative advice to businesses who want to make the most out of their marketing activity.

If you’d like to chat about your business issues, please call Victoria on 01787 277742 or email victoria@tuffillverner.co.uk

 

Protecting the innocent and vulnerable against First Party Fraud

Life’s not fair. And that’s a fact that we tend to learn very early on in life. But the level of unfairness generated by fraud in the UK is grotesquely unfair. The Fraud Advisory Panel states that UK Fraud is estimated to cost every adult in the country an average £765 per adult.

Against that backdrop, there is a requirement (particularly among those in the water industry, energy providers, telcos and financial services) that businesses should “treat customers fairly” – a challenging goal, given the increasing sophistication and ongoing evolution of fraud.

The many faces of fraud

Fraud has many faces – and it’s somewhere between difficult and impossible to keep up with the latest innovations from fraudsters. Fortunately technology, combined with experience, provides solutions to some of the problems. Identity verification, address and age verification, voice analysis, IP address checks, CCJ and credit checks all help in the battle against identity theft, cybercrime, password theft, credit card fraud, consumer scams and so much more. Transactional and social media all have a part to play – and can be particularly effective in the area of first party fraud.

First party fraud

So what is first party fraud? And how big a problem is it? Fraudscreen defines it as “your own customers, using their own identities, taking advantage of your inability to challenge their version of the truth, in a distance selling environment”.

And why not? It’s easy to do if you’re so inclined – just tell lies to businesses in situations where they can’t prove that you are not telling the truth.

The result? Higher costs for everyone. £765 per adult, much of which is due to first party fraud, is a huge amount of money for any individual. And it is the innocent, the vulnerable and the honest who end up paying the price for other people’s dishonesty.

Changes in culture and consumer behaviour

What’s particularly alarming is that this kind of opportunistic behaviour is continuing to grow across all demographics and throughout the UK. According to the National Fraud Authority Experian Fraud Index 2010 (April 2011), private sector fraud cost the UK economy £9.5 billion in 2010. Of this, over half was attributed to first party fraud – and when talking about automotive fraud, the percentage shot to a massive 80%!

We can make excuses about the economy, but this increase is at least in part driven by the shift in UK culture. Even in 2010, according to an ABI survey, 44% of individuals consider it acceptable to inflate the value of an insurance claim; in addition, consumers have been encouraged by the legal profession and others to claim injuries that cannot be disproved (soft tissue damage such as whiplash) – needless to say, this drives motor insurance prices ever upwards – last year saw a 39% increase!

‘Society’ has become increasingly tolerant of dishonest and opportunistic behaviour, and this acceptance has led to increases in first party fraud across home shopping, TV licensing, government-funded benefits, insurance, water and energy companies, lenders (credit cards, mortgages, banks and building societies, payday lending).

The common denominator? All these sectors offer the consumer the opportunity to receive goods, services, or money dishonestly, by exploiting weaknesses within a business’s systems and processes – particularly where there is no comeback in terms of CCJ or credit score. For example, first party fraudsters deliberately

  • Apply or place an order for goods, services, or loans with the pre-meditated intent NOT to pay
  • Tell lies on application forms
  • Claim that home shopping parcels have been returned or were never received
  • Falsify insurance claims and/or inflate the value of the claim
  • Falsely claim injuries that cannot be disproved
  • Fail to pay insurance instalments once certificate has been received

Until relatively recently, this sort of behaviour has gone largely unchallenged and has simply been attributed to bad debt, or delivery issues, or just not picked up at all.

The rule is simple. When it’s pre-meditated, it’s first party fraud.

Treating your customers fairly

The simplest solution for businesses is to tar all customers with the same brush and spread the costs among everybody. Unfortunately this means that the honest, the innocent and the vulnerable end up paying the price for the dishonest minority.

It’s hard to know that an individual “intends” to behave in a dishonest way before he has actually done so. But the good news is that, in statistical terms at least, it is possible to pull apart your customers into predictive segments of good, bad or mixed behaviour. Fraudscreen, for example, can be applied as early as prior to making an outbound marketing decision; for inbound, at point of application; even after the horse has bolted – ie when you’re at the point of collections or, worse, recoveries.

Having used conventional fraud prevention techniques to ensure you know to whom you are talking, it is then a matter of applying additional data that tells you how consumers are likely to behave. Most particularly, how they will behave in an environment where they can ‘get away with’ opportunistic behaviour – where it actually doesn’t matter what they do – because there will be no come-back in terms of credit score or litigation.

Third Party Data for First Party Fraud

There is a range of data sets that are used, individually and in combination, to prevent fraud of all types, including first party fraud.

Credit data identifies a customer’s ability to pay. CCJ and similar data is also extremely useful, but works best in combination with other data sets as it provides absolutely no information on individuals who have no CCJ against them. Geo-demographic data can also be useful as part of an overall data solution, as can transactional data like Goods Lost in Transit – a tricky area as not all GLIT is caused by bad people – it can just be that something’s genuinely gone wrong, or the person delivering is lazy or dishonest.

Consumer behaviour and attitudes

There are also data sets which can be used to understand a consumer’s behaviour and attitudes. Social data is becoming an interesting tool from a first party fraud perspective – useful insights can be carefully drawn from self-reported data on Linked In, Facebook, Twitter, Google + etc. In insurance, CUE, though it has some bugs to iron out, provides claims information which can be a useful tool to verify whether or not people are telling the truth on their application forms – especially as the consumer is now quite sophisticated in his use of aggregator sites to test which answers to which variables will provide the lowest premium. The application form has now become more about price than telling the truth.

And, of course, there’s Fraudscreen, a data solution which was designed from the outset to identify consumer groups who are likely (or not) to behave opportunistically (ie first party fraud), and provide categories of consumers who are statistically more or less likely to lie for their own gain, or steal if it’s easy, or claim money or refunds from service providers. Fraudscreen can be applied across sectors to segment customers into groups of predicted good, bad or mixed behaviour. It’s an ideal solution for helping businesses in their goal of treating customers fairly as its data provides insights into consumer attitudes towards payment and honesty. And it means that the innocent or vulnerable consumer is less likely to pay for the behaviour of the opportunistic consumer.

First party fraud isn’t going anywhere, and the issues of treating customers fairly will continue to grow. A water company recently quoted that honest consumers end up with an additional £16 on their water bill, purely to cover the costs of those who won’t pay. Rather than make everyone pay for the faults of the few, surely it would be fairer to punish the dishonest, reward the honest, be fair to the innocent, and help the vulnerable?

Fraudscreen was designed to help businesses treat consumers fairly, and succeeding in that challenge will provide businesses with a real edge over their competitors, help them gain and keep new customers, afford excellent PR opportunities and improve their profitability.

Victoria Tuffill is a direct marketing consultant with over 30 years experience. She founded Tuffill Verner Associates consultancy with Alastair Tuffill in 1996. She is also founder and Director of Fraudscreen – a data tool that assists in the prevention of 1st party fraud. Her experience ranges across businesses including publishing, home shopping, insurance, utilities, telcos and collections.

© Victoria Tuffill and Tuffill Verner Associates, April 2012. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Victoria Tuffill and Tuffill Verner Associates with appropriate and specific direction to the original content.

Multi-channel marketing … in schools

I was fortunate enough to enjoy reading and literature from a very young age, and, as a child, my father introduced me to Isaac Asimov. I promptly inhaled all his fiction, and, in particular, I remember reading a short story which has always stuck in my mind, called “The Fun They Had”. In that story, two children are reading with wistful enjoyment (and utter disbelief that any human could possibly know enough to be able to teach) about something called “school”, where children learnt and played together.

In Asimov’s future, every child has a mechanical “teacher” in their own home – programmed to the child’s own ability, which teaches and assesses its pupil on all subjects. The story was written in the 1950s and some 60 years later, Asimov’s vision of the future of teaching seems to be moving ever closer – and it’s certainly not taking hundreds of years.

Today we have extensive online education tools through all stages of education – from primary school vles (virtual learning environments) such as Espresso and Education City to all the way up to the scale to university and beyond. We have Fronter from Pearson – now widely adopted in London … there’s Noodle … Moodle … online revision tools … CEM (introduced into universities as early as the 1990s and since adjusted for use earlier in the educational process) … Open University has invested heavily in digital tools … support apprentice programmes like Blackboard; and many adult e-learning courses both for businesses and individuals.

However, there are still schools and universities, many of which are embracing technology in ways that other business sectors may find enviable.

Multiple marketing channels in education

Modern technology not only allows the provision of e-education, it also enables schools, colleges and universities to promote themselves, their brand, their goals, their community and their achievements to meet their own business goals and fulfil their ambitions.

Schools have unique challenges, which they address through the combined use of digital and traditional channels. State and private schools have subtly different goals, but today schools from both sectors are embracing technology to support their core priorities:

  • improved levels of achievement for their pupils (and better rankings in league tables)
  • a strong desire (particularly in the private sector) to raise awareness and persuade potential parents to choose that particular school for their children – just the same as any other business, but servicing a very specific market sector

The differences in technological philosophy between private schools (who have to find their pupils) and state schools (where pupils are admitted based on geographic location) are interesting. In general terms, state schools have been driving e-learning based on the curriculum; while private schools have been embracing technology to drive marketing.

But those differences are gradually becoming blurred, particularly with the advent of Academies and Free Schools. Schools use a variety of marketing channels to promote themselves and their community – from websites, SEO, print, direct mail, email, social media, e-learning, mobile technology, and TV and radio.

A strong emphasis on websites

Websites are essentially an interactive prospectus for schools, and provide a channel for self-promotion, dissemination of rules and policies and, importantly, to:

  • Engage parents – through inclusion of information, fixtures, exam statistics, OFSTED reports, news, pupils’ work and homework, blogs, school reports
  • Engage pupils – provide the facility for pupils to engage with each other and their teachers through private areas of the website, offer e-learning including “games”; internal debates; encourage contribution to school news reports and blogs
  • Engage the local community – publicise and involve the local community in school events, support local events, and form links with local industries
  • Raise money – publicise fundraising events; school charities; alumni engagement
  • Sell merchandise online – uniforms, equipment, sportswear – even souvenirs –directly from the website

There are some fantastic websites both from private and, more recently, state schools, who are now starting to see and reap the benefits of a good website as they begin to identify themselves as a business.

Social Media, digital and traditional PR

Use of digital PR is increasing in schools, combined with traditional PR through press and media, in a cohesive and integrated strategy to keep branding awareness, engagement and enjoyment of the school firmly in the public eye. A great OFSTED report should be shouted from the rooftops – as well as within a schools reception area; a visit from a famous author or celebrity makes an involving story; excellent exam results; a particular pupil or group of pupil’s remarkable achievement; school charity fundraising; particular sporting success; availability of school facilities to the community – all these provide opportunities to communicate and publicise the school both locally and farther afield.

But social media in schools has obvious challenges, and often has its own section in a communications / ICT policy. A problem with bullying or inappropriate posting is very serious. So it can be a tricky balance for a school to use Facebook or Twitter to promote themselves while adopting a proscriptive approach about whether or how their pupils may use them.

However, blogs, e-newsletters, Facebook, Twitter, and even Pinterest can be an effective part of a school’s overall multi-channel strategy, and can set an example to involve pupils in how to use social media wisely and understand their benefits.

A good example is set by Kelly College, who uses Facebook to promote the school, disseminate information, generate interest, good press and involvement for parents, staff, pupils, and the local and wider community – working almost as a microsite of the school website.

Of course the traditional PR channels are also used – press, community magazines, a printed prospectus with stunning photography, broadcast media, posters and print. Broadcast has an added advantage of the ability to load videos onto the website and Facebook and You Tube … to enhance involvement and drive improved Google rankings.

Keeping up with Technology

It’s noteworthy that much of the technological innovation in education comes from the children first – they know and use the new technology; they have an instinctive understanding of social media, the internet, tablets, smartphones and the internet – all of which are a fundamental, living and breathing part of their lives. There are “rate your teacher” or “rate your food” sites; children already use social media to keep in touch with their friends … and to achieve objectives – whether it’s a Twitter campaign to prevent the appointment of a new head teacher, or a fund-raising exercise from a blog about school meals. So how much of a school’s social marketing activity could – and should – be developed and produced with pupil involvement ‘in-school’?

The increasing availability of notebooks and ipads is also impacting schools – it’s not that long ago that having an ICT suite was considered very forward thinking. Now schools are developing and implementing strategies for a time when all pupils have notebooks or ipads – in which case ICT will become a thing of the past!

My thanks to Jessica Avery and Peter Provins for sparing the time to talk to me.

by Victoria Tuffill, August 2012

© Victoria Tuffill and Tuffill Verner Associates, August 2012. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Victoria Tuffill and Tuffill Verner Associates with appropriate and specific direction to the original content.