Digital Marketing proposal to increase the awareness and sale of Bosch power tools by 10% on Grainger.com. Proposal By Ashutosh Anand Professors Aric Rindfleisch, Kevin Hartman, Rhiannon Clifton University of Illinois Urbana-Champaign Digital Marketing Capstone

Table of Contents 3

Executive Summary 3

Client Analysis 3 Bosch Power Tools 4

About Bosch 4 Bosch Power Tools 4 Primary/ Secondary Customers 4 SWOT Analysis 4

Grainger.com 5 About Grainger 5 Grainger’s Customer Base 5

Problem Statement 6 What problem are we trying to solve? 6 Key Scenarios and Problem 6

Scenario 1 6 Scenario 2 7 Scenario 3 7 Achieving 3 Scenarios 7

Data collection and Analysis 8 Data Collection – Outline Of Procedures And KPIs To Be Reviewed 9 Potential biases and how to avoid them? 11

Channel Strategy 11 Recommendations for the content and tone of the message and visuals to be used for the campaign 13

Test and Control Plan 14

Bibliography 16

Executive Summary Grainger intends to increase its online sales of Bosch Power Tools on Grainger.com by 10 percent in a given year and this Consolidated Digital Marketing Plan will help Grainger achieve that goal. Based on the segment of customer scenario that has been raised by Grainger which are: Scenario 1: Customers visiting the Bosch Power Tools Page; Scenario 2: Customers entering the Bosch Power Tools Page on both Boschtools.com and Grainger.com; Scenario 3: Customers who click on the Bosch Power Tools Page on Boschtools.com, but go to the Grainger Plumbing Page. At first, Grainger will be monitoring the running marketing activity in 2016, analyzing as how the above customer scenario’s contribute to Grainger’s sales. In 2017, Grainger will launch a new marketing strategy, relying on points of difference that have traditionally been emphasized in Grainger’s marketing efforts to professional organizations but utilizing the powerful effects of customer testimonials taken from a digital marketing source: social media. The 2017 marketing campaign also includes opportunities for gathering primary research data through customer surveys that will assist Grainger in developing a new marketing strategy to achieve the goal of an improvement in Bosch Power Tools sales on Grainger.com by at least 10%.

Client Analysis

Bosch Power Tools

About Bosch Robert Bosch GmbH (About this sound pronunciation (help·info)), or Bosch, is a German multinational engineering and electronics company headquartered in Gerlingen, near Stuttgart, Germany. It is the

world's largest supplier of automotive components measured by 2011 revenues. The company was founded by Robert Bosch in Stuttgart in 1886. Bosch is 92% owned by Robert Bosch Stiftung.[1]

Bosch Power Tools

The Power Tools Division of the Bosch Group is one of the world’s leading providers for power tools, power tool accessories and measuring tools. In 2015, its roughly 20,000 associates generated sales of 4.5 billion euros, about 85 percent of which outside of Germany. With brands such as Bosch, Skil and Dremel, the division stands for customer focus and great engineering progress. The core success factors are innovative strength and pace of innovation. The division generated about one third of its sales in 2015 with products that have been on the market for less than two years.[2]

Primary/ Secondary Customers Like Grainger, Bosch Power Tools has primary and secondary customers. The primary customers are procurement officers who buy the tools. The secondary customers include end users who search online for information on products they desire to use at work or whatever the needs come. Market research findings have shown that recommendations amongst colleagues(secondary customers) make a decisive contribution to the sales success of Bosch Power Tools. Bosch Tools is up 95% in web traffic from last year. The brand remains very strong, continues to make a high quality product, great innovations in their new products, good marketing and very few layoffs while other companies in general have seen cuts across the board. SWOT Analysis

Strengths Extensive focus on R&D - 3800 patents Quality of products - customer loyalty Balanced portfolio - different sectors International foothold Competency in automotive core components

Weaknesses Slow to respond to dynamic market demand Employee productivity Extensively process oriented Huge debt

Threats New players in sector - higher competition Lower sales due to high pricing Automotive sector demand fluctuations due to fuel pricing, external factors - uncertainty in core market Competency in automotive components Industry/Home appliances Energy Healthcare

Opportunities Increased demand for quality long serving products Renewable energy sector Hybrid car components Innovative new technologies, products

Grainger.com

About Grainger Grainger has a distinctive US business model with two differentiated online channels.One is Grainger.com, mainly addressing customers in large, complex- and medium-sized organizations. The other is Zoro.com, a niche website targeting smaller, less complex businesses and do-it-yourselfers. Since Grainger’s Canadian and Mexican clients typically utilize country-specific versions of these two websites, this discussion concentrates exclusively on these US-focused websites and the goal of the Capstone Project: increasing Grainger.com sales by 10%.[3]

Grainger’s Customer Base As noted earlier, Grainger’s best customers (80%) are large, complex organizations. Demand for power tools has also witnessed a surge among professionals, owing to resurgence in the housing market. The global volume of construction is expected to grow by 70% and reach US$ 15 trillion by 2025. The U.S., China, and India are expected to witness robust construction activity, owing to which demand for power tools is expected to increase in the future.

Problem Statement

What problem are we trying to solve? The goal of this Consolidated Digital Marketing Plan is to increase Bosch Power Tools sales on Grainger.com by at least 10% in a particular year. The problem to be solved is how to find the marketing strategies that will accomplish this goal.

Key Scenarios and Problem

[4]

Consider the above CDJ based on the above CDJ we will be mapping our sccenarios

Scenario 1 Audiences that visit Boschtools.com, look at a power tool (for example a drill), but do not visit Grainger.com CDJ-Phase: Initial Consideration Set Here are suggested analyses to perform:

● Perform traffic analysis on the time spent on Bosch Power Tools Page – Builds Awareness

● Retarget a display ad indicating that Bosch Power Tools are sold on Grainger.com – Builds Awareness.

● In response to time spent on Boschtools.com, retarget a display ad with an invitation to join the email registry, and, upon registration, transmit email touting Grainger.com’s advantages – Influence Consideration.

● If Scenario 1, in the email registry and past but not current Bosch Power Tools customer on Grainger.com, sent an email to consider buying Bosch Power Tools

Scenario 2 Audiences that visit Boschtools.com, look at a power tool, and then visit Grainger.com, log in to Grainger.com, and visit the power tools category CDJ-phase: Moment of purchase or Post-purchase Experience

Here are suggested analyses to perform:

● Use traffic analysis to monitor time spent on Boschtools.com and Grainger’s Bosch Power Tools Page – Builds Awareness.

● After analyzing time spent on the two pages, then send a display ad invitation to join the company’s email registry, following up with email content marketing touting Grainger’s advantages – Influence Consideration.

● In the registry, but with an abandoned shopping cart, they get content marketing with necessary details to complete a buy order on Grainger.com’s – Improve Sales Process.

● If Scenario 2, in the email registry and past customers on Grainger.com but not buying or abandoning shopping cart now, receive email asking whether to buy BoschTools on Grainger again? – Reposition the Brand.

Scenario 3 Audiences that visit Boschtools.com, look at a power tool, and then visit Grainger.com, log in to Grainger.com, and visit the plumbing category but not power tools” CDJ-phase: Active evaluation or Moment of Purchase Here are suggested analyses to perform:

● A/B and multivariate testing ● Should time spent on the two pages (Boschtools.com and Grainger Plumbing Page) be

analyzed to determine if non-customers get retargeted? - Builds Consideration. ● Outcomes analysis

Achieving 3 Scenarios

Business Objective

Key Question Data-> Source

Scenario 1 Build Awareness Do secondary end users and potential primary customers know that Grainger.com carries Bosch Power Tools?

Clickstream Traffic ► OpenTracker; Competitive Intelligence (desktop/mobile search activity) ►Google Trends; and Traffic Analysis (desktop/mobile search activity) ► Google Analytics.

Scenario 2 Influence Consideration

Do secondary end users and primary customers want more details on Grain ger.com’s prices and services in order to better evaluate a possible purchase?

Clickstream Traffic►OpenTracker; Competitive Intelligence (desktop and mobile search activity)►Google Trends; and Traffic Analysis (desktop/mobile search activity)► Google

Analytics

Scenario 2 Influencing Sales Do sales efforts result in additional sales for Bosch Power Tools on Grainger.com?

Testing► Google Website Optimizer (Can the sales effort to convince customers to buy on be Grainger.com be aided?).

Scenario 3 Reposition the Brand

Are there steps that can be taken to improve the brand experience so that Grainger.com might have repeat customers of Bosch Power Tools products?

Voice of the Customer► Google Customer Surveys (Can past experience be improved? Encouraged to be repeated?).

Scenario 3 Grow Loyalty Are Grainger.com customers delighted and wish to advocate for my brand?

Voice of the Customer Survey Question (to determine if delighted), then Brand Advocacy Survey Question (only if delighted)►Google Customer Surveys

Data collection and Analysis Collecting relevant data for analysis is challenging. There are dozens of options, but a good marketer wants to define some template, from where to start. Data collection options for Grainger problem statement presented can be for instance:

● Competition analysis of Grainger + TOP5 competitor, Similarweb ● Website traffic analysis (Grainger and Boschtools) from Alexa or Similarweb or Google Trends ● Social media analysis via TrueSocialMetrics, to compare different SOME platforms (Grainger

and Boschtools) plus combining Economic Value from Google Analytics ● Google Trends analysis of Grainger, Boschtools relevance, also power tools trended generally

in USA Sentiment analysis of Twitter volume via AnalyzeWords ● Search (organic or paid) analysis for Grainger.com from Compete PRO ● Analysis of Sales trends based on Grainger.com and/or Boschtools data management ● Segmentation study for Grainger, for instance company data management enhanced with

demographic data, like Census Facebook and Twitter performance overview plus Team response time by Hootsuite

Data Collection – Outline Of Procedures And KPIs To Be Reviewed

Business Objective Key Performance Indicators(KPIs) To be Reviewed

Build Awareness

Acquisition KPIs: •Clickthrough Rate (CTR) - Bosch Power Tools Page and Ads; •% New Visits - Bosch Power Tools Page and Ads; •Cost Per Click on Ads or Cost Per Mille on Ads (CPC/CPM); and •Cost Per Acquisition or Impression on Ads (CPA). Behavior KPIs: •Bounce Rate on Boschtools.com, Ads and Grainger.com; •Depth and Length of Page Views; •Shopping Cart Abandonment Rate on ePro; •Loyalty on Boschtools.com and Bosch Power Tools Page on Grainger.com; Outcomes KPIs: •Return on Advertising Spend (ROAS); •Days to Conversion on Ads; and •% Assisted Conversion Rate.

Influence Consideration

Acquisition KPIs: •Click To Open (CTO) on email asking customer to join the Email Registry; •Unique Open Rate/Site Traffic; and •CPA on Email (separate statistics for A and B versions). Behavior KPIs: •Bounce Rate on Email, Email Registry; •Depth and Length of Page Views; •Shopping Cart Abandonment Rate; •Session Length on mobile email registry application/Loyalty; and •Events Per Visit on Boschtools.com and Bosch Power Tools Page. Outcomes KPIs:

•Database Conversion Rate on Email Registrants in response to email; •ROAS-Sales Conversion Rate/Days to Sales Conversion on Email; and •% Assisted Conversion Rate.

Grow Loyalty Acquisition KPIs: •CTO on email sending YouTube video/invitation to become a social media brand ambassador; •Unique Open Rate/Site Traffic; and •CTR on YouTube link/invitation to become ambassador. Behavior KPIs: •Bounce Rate on YouTube and owned social media feeds associated with the invitation; •Depth and Length of Page Views; •Applause Rate on YouTube and owned social media; •Partial/Complete Views on YouTube; •Actions Per Social Visit on YouTube; •Posts, Comments, Sharing, Tweets and Retweets on Social Media relating to Brand Ambassadorship; •Events Per Visit on Boschtools.com, Bosch Power Tools Page on Grainger.com, YouTube and owned social media feeds. Outcome KPIs: •Conversion Rate on Email to YouTube Viewership as well as Brand Ambassadorship action on owned social media feeds; •Sales Conversion Rate on posts associated with Social Media Advocacy; and •Days to Conversion on Email and attempts at Social Media Advocacy.

Improve Sales Processes

Acquisition KPI: •CTO on email giving necessary details on an ePro order; •Unique Open Rate/Site Traffic; •CPA on Email; Behavior KPI: •Bounce Rate on Email, ePro and Bosch Power Tools Page on Grainger.com; •Depth and Length of Page Views; •Shopping Cart Abandonment Rate; •Session Length/Loyalty; and Outcomes KPI: •ROAS - Sales Conversion Rate on Email; •Days to Conversion on Email and ePro; and

•% Assisted Conversion Rate.

Potential biases and how to avoid them? When collecting and analysing data, there is always possibility of danger of bias. Different kinds of categorizations of bias are made. There’s one framework from Jayson DeMers, who presents five different biases to avoid in market research: “1. Confirmation Bias: This type of bias is a tendency to interpret information based on a previous assumption, rather than letting the data speak for itself. 2. Irrational Escalation: This cognitive bias is the tendency to dismiss or ignore new research evidence if it happens to override or undermine a decision that has already been made. You need to be open to the idea of cutting your losses. 3. Social Desirability Bias: Social desirability bias leads people to make more socially acceptable decisions when in the presence of a researcher than they would if left alone. 4. Framing: The theory behind the framing effect states that similar information will yield different conclusions if it is presented in a different way. 5. Knowledge Bias: The bias states that people sometimes prefer familiar options over options that are objectively better.” And how to avoid such biases? To try to be out of any pre-assumptions, and observe the data as objectively it is possible. Sometimes, when company has already invested a lot of resources and completing a research, which shows totally different, what was expected, it is good to start again (without pre-assumptions). Depending on whether the data is collected by person or by “machine”, it can lead to various results. People tend to want to please the interviewer more, when data is collected face-to-face than when they can conduct the questionnaire by themselves alone. Human being is mainly social and wants to create pleasant atmosphere. It is good to consider, when conducting for instance by phone, when by e-mail, when “pop-up questionnaire”. To avoid framing it is crucial to think the order of the words in questions, but also the order of questions itself. Usually questionnaires include so called “checking” questions, basicly the same or similar question in some frequency to test, whether the respondent is consistent in replies. Especially building brand awareness and performing for instance the brand inquiry for certain sampling group it is important to remember that people tend to respond, if they are familiar with the brand. It is rationale to have different focus groups to perform data collection. For instance first-time visitors on Grainger.com, current customers, passive customers (have bought something in ages) and also a group, who are prospects, not visited Grainger.com yet. Comparing the results can help to understand the power of the Grainger brand more than just conducting the inquiry only non-visitors or current customers

Channel Strategy Audience category 1 - Users landing on Grainger.com directly

For someone visiting the website for the first time, Grainger could make use of a pop up display advert that, after browsing the site for a period which indicates an interest in the product, the pop up display ad can then offer the option to sign up to the newsletter to keep abreast of any special offers that Grainger are offering on products. As mentioned in the course lecture video on “Optimising your plan” presented by Rhiannon Clifton, statistics show that only 2% of first time visitors will purchase on their first visit to site. Grainger can therefore use Retargeting (using display ads to create cookies on website, following customer around to other websites and reminding them of the product they viewed previously) in order to draw the customer back to the website and convert the other 98% of first time visitors into purchases. Email campaigns to new customers will act as promotional email campaigns as you are trying to entice the customer to return to the website to purchase (i.e converting the customer). Therefore, those customers opting into the newsletter offer from the pop up display ad, will be targeted with promotional email campaigns Vertical banner display ads can be used to target existing customers. Through the use of analytics, Grainger can pick up and determine customer preferences and target these customers with specific products based on their preferences.

[5] As shown in above figure, Facebook is the top source of display ads. As there is a greater than 50% chance that a person who likes a Facebook photo of a product will buy that product, Facebook should be a major source of display ad spend and the display ad should include an image. Images should also be part of the display ads that will be targeted to readers of Answers.com pages of interest to primary or secondary customers. Display Ads - To Increase Consideration And Invite Potential Customers To Join the Email Customer Registry After receiving display ads on Facebook and Answers.com, Scenario 1 customers will be provided with a display ad inviting them to join the Email Customer Registry.

This display ad will also be made available to customers who follow Scenario 2 (Bosch Power Tools Page on Boschtools.com and Grainger.com) and/or Scenario 3 (Bosch Power Tools and Grainger Plumbing Page). The display ad will highlight that Grainger is a distributor of both corded and cordless Bosch Power Tools. It will also promise those who register information on future Grainger promotional offers on Bosch products and Accessories. Emails To Procurement Officers To Influence Consideration Should an internet user respond to the invitation in the display ad and join the Registry, Grainger will send follow-up emails individually targeted primary or secondary customers touting one of Grainger’s major advantages relative to its competitors. Procurement officers will receive an email highlighting the point of difference that Grainger has a competitive advantage with its ePro electronic procurement system with the option of joining KeepStock. . Email/Customer Survey To Procurement Officers To Reposition The Brand An email will be sent with a customer survey requesting that the drivers of their past purchases be quantified. The email to procurement officers will emphasize Grainger’s professional distribution of professional, well-engineered, high-quality, durable Bosch Power Tools products and accessories. Another attribute that will be tested is whether procurement officers pick Grainger because of its eProcurement and KeepStock systems. If there is another attribute that is appealing, it will emerge from the survey responses as to what they liked and what they want to see changed before shopping Grainger.com again.

Recommendations for the content and tone of the message and visuals to be used for the campaign Scenario 1 - Audiences that visit Boschtools.com, look at a power tool (for example a drill), but do not visit Grainger.com The content and tone of the mail campaign to new customers should be personalised (i.e Dear and the customer’s name, not just Dear Customer). As it is their first touch point with the company, the tone needs to be professional and welcoming. Secondly, the customer needs to receive a welcome message from Bosch tools for signing up to the newsletter and possibly encouraging the customer to set up personal preferences (this will allow you to determine the type of product promotions to send them for future mail campaigns – i.e customer preferences). A email from the CEO of Grainger will be more impactful along with a coupon.

Offering discounts to Customers who have visited the website and added the product to cart

Test and Control Plan 1. List three research objectives. Conducting some research will help us verify and improve the campaign performance. There are three main research objectives: • What Research is Necessary? • What Analytical Tools Will Be Used? • How Can Impacts On User Experience Be Avoided? First SMART Research Objective: In 2016, before the display and email campaigns are launched, we need to determine the number of Bosch Power Tools Page Viewers in Scenarios 1, 2 and 3 who become new and repeat customers. For each Scenario, Grainger should use Analytics to determine total sales. If the activity cannot be tracked until December 2016, then it should be measured for the first six months of 2017 and multiplied by two to obtain the annual estimate. Second SMART Research Objective: In 2017, increase the number of customers who are aware that Grainger sells Bosch Power Tools, and convert a percentage into new sales. Grainger should increase awareness by 38.73 percent, and generate a 2.5% increase. Display ads and emails will invite internet users who click Boschtools.com to possibly make a purchase on Grainger.com. The email touting Grainger’s advantages relies on an essential digital marketing strategy: activate consumers to market on your behalf. The social media commentary that is the basis of the storyline in the follow-up email presents favorable customer testimonials on behalf of each customer segment. What analytical tools will be used to measure whether this SMART Research Objective has been achieved? • For the display ads on Facebook and Answers.com, Grainger should use the Google Analytics tool to monitor customer traffic. For each IP address, register clicks on the display ads on Facebook and Answers.com and subsequent purchase activities (abandoned shopping carts and purchases on ePro). For the past three months, Grainger’s display ad traffic is .42, and the goal of .35 appears achievable. • The display ad with the invitation to join the Email Registry will be received by those who click on the Bosch Power Tools Page. This group of internet users enjoyed the highest CTR rate and should easily reach the .35 benchmark for display ad traffic on Grainger.com. • Grainger should also use Google Analytics to measure the effectiveness of the follow-up email to the registrant touting Grainger’s advantages in generating new sales. The CTO rates were benchmarked at 19.19%. • Grainger will determine the conversion rates in 2017 for display ads and the registry-related emails. As shown in the benchmarks presented in Module 3, Task 3, email campaigns ($28.50) are slightly more effective than display ads ($34.425).

Third SMART Research Objective: Grainger should try to generate a 7.5% increase in customers and 500 new social media ambassadors from the final three email content marketing strategies—Improving the Sales Processes, Repositioning the Brand and Grow Loyalty. Percentages will be different for the emails providing necessary details on how to order in ePro (4% new and repeat customers), repositioning the brand (1.75% new and repeat customers), and inviting customers to become a social media ambassador (1.75% new and repeat customers, 500 social media ambassadors). To achieve the Third SMART Research Objective, both Google Analytics and Google Customer Survey tools will be used. • The Key Performance Indicators (KPIs) to be measured for each of these three emails are CTO, Abandoned Shopping Cart and Sales Conversion. • Google Customer Survey responses will be reviewed for the reasons driving past customer purchases. Was it the prevailing point of difference (for procurement officers, the website/ePro difference and end users, “Everyday Heroes”) or another reason. • Determine whether a total of 500 procurement officers and end users became social media ambassadors and review other quantitative data generated from the Google Customer Surveys for planning future marketing strategy. • Focus on how many procurement officers and end users were delighted with the old marketing strategy or the new marketing strategy represented by the video. User experience will be improved through the application of best practices. All clickable links will be highlighted in blue and take the email recipient to the appropriate website or customer survey. Subject lines in emails will contain mentions of keywords known to increase CTO rates—such as “video.” Rather than a video link, video thumbnail of the YouTube content will be included in the body of the email.

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Bibliography Works Cited

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