Month: April 2019

Point-of-sale loans, or loans offered to customers at checkout, are quickly picking up pace among retailers. The latest is Mastercard, who this week acquired Vyze, a platform that connects customers shopping in-store and online to a range of different purchase financing options at checkout. Its customers include brands like Home Depot, Microsoft, HTC and Samsung, and Mastercard wants to scale it to other retailers, who pay fees to Mastercard to enable the service.

It’s a hot market: Point-of-sale loan startups, like Affirm, Klarna and Bread, are getting increased attention from funders: According to data from CB Insights, 9 point-of-sale companies raised more than $700 million between June 2017 and October 2018.

The Vyze acquisition is the latest among a series of point-of-sale lending opportunities that retailers can enable, on the heels of a recent Walmart program to give customers access to point-of-sale loans through Affirm. Mastercard said point-of-sale financing through loans offered through the Vyze platform have the potential to be a massive customer acquisition channel for retailers.

Retailers have traditionally pushed store cards at checkout — but they’re often a source of friction for customers and merchants. Customers who don’t get approved might abandon the purchase altogether, and retailers rolling them out might face a backlash from customers if they’re too pushy or if the terms are seen as unreasonable.

High-interest cards can be seen as predatory; with rising delinquency rates and reports of store employees being incentivized to promote them to customers, they can be a brand risk to the retailer. But with the advent of point-of-sale loans offered by third-party lenders at checkout, retailers give customers more choices to finance their purchases. It’s a win for retailers because it can result in less abandoned transactions, and it keeps their brand outside of the consumer-financing picture.

“Merchants love it because now they don’t lose the customer,”  said Zahir Khoja, svp of global acceptance at Mastercard. “They can increase basket size and create loyalty with their end consumers. It gives lenders approval rates north of 80 or 90%, which they wouldn’t see today.”

As a result, instead of an awkward moment where customers who are declined may feel shy about continuing with the purchase, the customer gets provided a menu of available financing options. Mastercard wouldn’t comment on specifics of the types of offers that Vyze partners offer customers, but Affirm and Splitit start at no-interest options. Since the loan is between the customer and the lender, the retailer doesn’t take on the risk if the customer defaults on the loan.

“The main implication here is the ability to facilitate seamless acquisitions of rewards or miles for consumers without having to go through the typical steps of signing up,” said Moshe Katri, managing director of equity research at Wedbush Securities. “Theoretically, this should help merchants with new consumer acquisitions.”

It’s a model that’s yet to be tested in a post-recessionary environment, Leslie Parrish, Aite Group senior analyst, said. And while the potential to add financing options is a way to grow a retailers’ customer base, it comes with the risk of lending to people who may be rejected from a retailer’s store-card program. If the customer’s experience of the loan process is seen as sub-par, or if the terms are seen as predatory, the retailer risks tarnishing its image in the eyes of the customer, said Brendan Miller, former principal analyst at Forrester and currently head of global marketing at payments company Rapyd.

The opportunity for retailers with point-of-sale platforms like Vyze is to let lenders compete for customers’ business by offering the best possible terms — a move that, if done correctly, could elevate the retailers’ brand proposition among customers.

“Imagine a scenario where the customer [is] presented with three financing options at checkout, each lender would compete for the customer’s business and all the terms would be completely transparent,” said Miller. “The customer could choose between the private label program, Affirm, or a 30-day post-paid billing option. That would be truly innovative.”

The post Point-of-sale loans gain traction among retailers appeared first on Digiday.

Let’s face it: no child harbors life-long dreams of one day breaking into the ad tech sector. It’s a far more serendipitous road than that. For that reason, many ad tech executives nurse a secret dream job, should they ever decide to leave the sector.

We asked a bunch of ad tech executives what they would wish to do should they ever leave ad tech.

The best responses are featured below.

Justin Taylor, managing director, Teads
My post-ad tech dream is to start a delicatessen where I live on the South Coast. Move away from the commute and connect with local produce and the local community. I suspect there would still be some programmatic advertising and content-rich marketing involved — can we ever get away from it fully?

Andrew Buckman, chief operating officer, Sublime Skinz
I’ve tried to leave ad tech twice in the last 10 years; I even got as far a business plan once. I live for the outdoors. I dream of spending my time in the mountains and just getting out there. If I could, I would spend the rest of my days running my local Scout troop full time instead of just on Saturdays and every other spare moment. Introducing young people to new adventures is one of the most rewarding things I’ve ever done.

Fiona Salmon, managing director, 1PlusX
When GAFA [Google, Amazon, Facebook and Apple] rules the world and ad tech players slide into the abyss, I’ll be an interior designer. I live for my daily Pinterest and Instagram interiors inspiration. It’s the last thing I check before I go to sleep, and it’s the first thing I check when I wake up. Before our first child was born, I decided to enroll on a yearlong interiors course with The Interior Design Institute, and I loved it. [With] three children along, I’ve not completed the course, but I will, one day!

Luke Fenney, vp of publisher sales, international, Index Exchange
I love this industry, but if I had to leave, I’d set up a high-end road cycling hire and tour company — something that would allow me to ride my bike in locations all over the world each day. Think: the Louis Vuitton of biking experiences. Stay tuned!

Dan Wilson, CEO London Media Exchange
I am not sure you can ever truly leave ad tech, but when I do, I am going to drive old people round an airport on one of those golf buggies. It will genuinely put a smile on my face helping the elderly get to what may possibly be their last flight somewhere.

Clare Delaney, sales director, EMEA, Staq
Everyone thinks about their Plan B, and my mind wanders sometimes to having my own cheese and wine shop/bar for people to stop by, eat cheese, drink and chat. So basically doing what I like to do. Weirdly, it does run in my family as my Grandad on my Dad’s side owned a Dairy, and there is still a creamery in the family down in Minehead in Somerset. For now, I will be working my way around London’s cheeseboards.

Craig Tuck, managing director, Ozone
We recently moved home and have acquired a slightly larger garden. That responsibility is not something that sits well with me, having been guilty in the demise of many pot plants over the years! We needed help. The gardener arrived, with a refreshingly positive outlook on life, laid-back style and all-around happy aura. Not only was the garden looking ship-shape, but we had some funny stories to tell and bigger smiles on our faces when they left. Post-ad tech, I’d like to do that: take in the fresh air, hug a few trees and make people smile again.

Chris Bennett, managing director, EMEA, Pixability
It’s all about books, boats and bicycles for me, with the proviso that any ambition beyond ad tech has to coincide with approval from The First Lady — aka Mrs. Bennett. At the top of the list will be a gentle bike ride from the East to the West Coast of the U.S. Ad tech normalizes you to Silicon Valley executives, Boston-based MIT dudes and deal-making New Yorkers. I’d like to meet some of the 327 million Americans between the coasts, and then write a book about the experience.

Denise Breslin, managing director, Mobsta
If I didn’t work in ad tech I’d want to work at Coca-Cola. Since I was young I’ve loved the brand — I had a Coca-Cola bottle-shaped pencil case at school — and actually moved to London, with a degree in marketing, thinking I’d be a brand manager at Coca-Cola.

Amit Kotecha, marketing director, Permutive
I’m currently on holiday at the home of Lego in Denmark. There is the opportunity to build Lego and be creative at every turn here. I think the ad tech industry often lacks this creativity. Everything is based on numbers and statistics which means that we deliver results based on facts, but forget we are delivering advertising to create a human connection for brands. If I ever left ad tech, I would love to work for a brand like Pixar or Lego that inspires and enables people to explore their own creative potential.

The post ‘Delicatessen owner, Scout leader, interior designer’: Ad tech execs reveal their Plan Bs appeared first on Digiday.

Six months into the job, JCPenney’s new CEO Jill Soltau is filling out her executive team with alumni from Macy’s, Walmart, and Target, and signaling that improving pricing and merchandising strategies will be her top priorities.

With declining sales and a high debt to pay off, the hires also give some indication of how Soltau plans to turn the company around.

On Wednesday, JCPenney announced that it had hired a new principal accounting officer, and a new senior vice president for home product design and development. It is also bringing on Trish Adams, formerly Target’s executive vice president of its merchandising group, as a strategic advisor. In a press release, JCPenney said that Adams will “evaluate and create plans to simplify and improve the effectiveness and profitability of the Company’s pricing and promotional strategies.” (JCPenney declined to provide additional comment for this article).

JCPenney’s sales declined by 7.1% last year to $11.6 billion, and the company has about $4 billion in debt to pay off. Soltau took over in October for Martin Ellison, who left to take over the CEO job at Lowe’s. Soltau has said that her main priority at JC Penney is to “re-establish the fundamentals of retail.”

In bringing on Adams in particular to oversee JCPenney’s pricing overhaul, it signals that the company may be trying to take some cues from Target in order to do so. In 2017, the Minneapolis-based retailer decided to streamline its promotional strategy, by getting rid of “two-thirds of its price and call-out offers,” that advertised limited-time deals in favor of more consistent promotions.

Tiffany Hogan, an analyst with Kantar Consulting, said that JCPenney would be wise to take a cue from Target’s strategy, and simplify its couponing while at the same time making customers confident that they can find could deals every day. On the home page of its website, JCPenney currently advertises up to 50% off for some of its private label brands, an Easter sale, up to 25% off on Nike products, and a buy one get one deal on women’s sandals, all of which end at different times.

JCPenney’s struggled to establish a consistent pricing strategy over the last five years, thanks in part to churn at the CEO level. Ellison’s predecessor Ron Johnson, who left the company in 2013, was criticized for trying too many things at once. He tried, for example, to rid of sales and coupons altogether, and instead emphasizing that JCPenney offered low prices every day — but by getting rid of all of sales and coupons, shoppers felt he moved too drastically.

In her second earnings call in February, Soltau told analysts that she had five other main priorities, in addition to simplifying the promotion strategy: reducing excess inventory, strengthening the company’s omnichannel capabilities, redesigning store processes and investing in more tech tools to help associates better serve customers, improving inventory shrink, and “rethinking our merchandise assortments and strategies.”

In merchandising, one of Soltau’s first steps was to stop selling appliances at JCPenney — something that her predecessor Ellison added — while signaling her intention to invest more in women’s apparel. To that end, the February hire of Michelle Wlazlo — formerly Target’s senior vice president of merchandise, apparel, and accessories, who also oversaw Target’s private label strategy, signals that JCPenney might invest more in private label brands.

“This is someone who looks like they know the apparel business, and has seen it from the old ways of doing business through the new way,” Jessica Ramirez, a retail analyst at Hali & Associates said, citing her experience at Gap and Saks Fifth Avenue in addition to Target.

But the biggest challenge Soltau will face is not if she can turn around the company, but if she can do it before JCPenney has to start paying off its mountain of debt.

“They needed to act yesterday rather than tomorrow,” Ramirez said.

 

The post With new hires, JCPenney’s new CEO outlines turnaround strategy appeared first on Digiday.

Unlike agencies, publishers aren’t known for their elaborate onboarding programs. But competing with the platforms for top talent continues to get tougher. That’s why publishers including Condé Nast International, The Telegraph and News UK have begun honing their onboarding programs to woo new recruits, albeit in more muted ways than their agency counterparts.

Four weeks ago, Condé Nast International launched an app for all new recruits as a way of keeping important information new hires need in one place. The app drip-feeds information 30 days before staffers join the company and 30 days after. Previously, the publisher had a very light onboarding process as its London HQ is a relatively new office.

“The opportunity is in the pre-onboarding; this is the period of time where engagement is critical,” said Zoe Walters, director of the people team at Condé Nast International. “It helps give certainty of what the new hire is joining, helps answer questions and also provokes curiosity.”

To improve the onboarding process, News UK has started surveying new starters after the three-month period to spot irregularities and inconsistencies. Currently, 94% of new starters surveyed score the top attributor as the people in the company. For the last year, the publisher has paid closer attention to the full employee journey.

Publishers like The Telegraph have a straight-forward weeklong induction where leaders talk about the brand, its history and the strategy, as well as hosting sessions on technology, compliance and benefits. The Telegraph updates the sessions continuously. The most recent version includes a session from its head of diversity, inclusion and belonging.

Thorough onboarding programs reduce the likelihood of new staffers leaving within the first six months, but there are some companies where the heavy lifting stops when the new recruit walks through the door. Research by executive search firm, Wickland-Westcott, which offers a 90-day employee onboarding service to firms, found that 90% of companies estimate that between 10% and 25% of people leave within the first six months of joining. While 98% of companies believe onboarding programs are key in retaining talent, there’s a gap in the market: 30% say onboarding programs last for a week, and that drops to 23% that say they last just one day.

“There’s clearly a demand, but companies don’t do much,” said Adam Hillier, practice lead for marketing and digital at executive search firm Wickland-Westcott. “There’s a real need for employers to quickly align candidates with the basic toolbox required to join the company.”

A common approach, said Hillier who primarily works with finding candidates in the mid-level ranking with base salaries ranging between £150,000 ($195,000) and £300,000 ($390,000), is setting up a few meetings in the first week with key stakeholders.

“It can be more prevalent at a senior level that, by expectation, they will land quickly,” he said. “Companies fail to understand senior-level people don’t have the bandwidth to get others up to speed and help them establish themselves in a new business.”

Companies will always point to finding the right people as an ongoing challenge, and there have long been complaints that Facebook and Google suck up talent with alluring career prospects, bountiful resources and good stock options, as well as thorough embedding programs for new recruits. The latter can fall off the priority list for publishers on razor-thin margins that have spent up to a year, plus decent sums, on headhunter fees to find the right senior leader.

Equally, for legacy media companies, there are still a lot of siloes that exist within departments that make it harder to get to grips with all parts of the company. Netflix is regaled for its excellent onboarding process. According to a former Netflix employee, new recruits don’t do any tactical work for up to two months; instead, they learn about the business, build relationships and knowledge through dozens of one-to-one and offsite meetings. Continuously updated documents capture information ranging from various teams and workflows to tough experiences to learn from. Staff is encouraged to show vulnerability so that new starters feel they can reach out.

Wickland-Westcott’s 90-day onboarding process includes chemistry tests, expectation meetings, new-manager language briefs and personality profiles, but a key element is having an objective third-party present to bounce ideas off since new starters may be more hesitant to speak their mind to a new boss.

Even so, keeping employee churn down to zero is near impossible, even in the early days, and no amount of onboarding will keep the wrong candidate in the job. “In media companies,” said Hillier, “there is a lot more that they can do to make a more compelling value-add for the individual coming in.”

The post Publishers tinker with onboarding processes to better attract and retain staff appeared first on Digiday.

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The post What First-Party Data Does Epsilon Actually Have? appeared first on AdExchanger.

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