*Transcript by Descript

And so, you know, this business has just, as I said, it has accelerated quite a bit since COVID. And if you look at our cater growth of the last five years, it’s been about 30 percent growth. So it’s been quite significant.  Retail Unwrapped is a weekly podcast hosted by Robin Lewis and Shelley Kohan from The Robin Report.

Each episode dives into the latest trends and developments in the retail industry. Join them as they discuss interesting topics and interview industry leaders. Keeping you in the loop with everything retail. And  thanks for joining our weekly podcast. I’m Shelley Kohan, and I’m very excited to welcome Jennifer Downes from Lenovo.

She’s the CMO of Global eCommerce. So, I mean, being a CEO in today’s retail environment and really Lenovo’s wholesale retail environment. It’s probably one of the most exciting jobs with advanced technology, sophisticated software, along with radical advancements in AI and of course, generative AI, you know, marketing is really marching to a new order.

So I’m so thrilled to have you on Retail Unwrapped. And, uh, I’m interested in hearing about marketing in the new age. And also, I know you’re going to tell us a little bit about how you’re increasing customer retention and repeat buyers. So let’s jump right in and welcome.  Thank you, Shelley. It’s really great to be here.

So I appreciate very much you inviting me here today  because we’re going to talk about some of the work you’ve been doing with a company called Blue Corps, which I found super interesting. But before we jump into that, let’s give our audience a little bit of a background on Lenovo. Obviously, everyone knows the brand, but similar to other retailers, the company has really gone from kind of a wholesale to retail to direct to consumers.

So tell us a little bit about the transition for Lenovo.  Absolutely. It’s, this is a great story. So I love this question. You know, Lenovo is a global PC or technology company and As large as we are, we really had somewhat humble beginnings. And so we, we purchased the IBM PC business back in 2005. That included our flagship ThinkPad product, which is what many of us know us for, consumers and business folk alike.

And we eventually purchased IBM server business as well as the Motorola phone business. And so that really allowed us to realize this notion that we wanted to offer solutions to our customers, everything from pocket to the cloud. And so hinging off of that, we are a very. Customer centric organization at heart, and we saw the opportunity for the direct to consumer route to market.

And we saw that that was something that customers really wanted us to lean into. And so we launched the lenovo. com direct business in 2006. We operate in 34 direct countries today. And we see about a billion visits every single year. So it’s, it’s quite a large site and experience that we have built for our global eCommerce business.

And I would have to say the site, the site really services to 2 objectives. If you will. 1 is a destination for people to come to learn about our products to research. But they may not buy there. And so it really, it supports our omni channel sales efforts. Most of the people, and some find this surprising, most people who come to Lenovo.com actually don’t buy from us directly, they will buy from retail or they’ll buy from other channels.

But there are always those select people who really want that direct relationship with the brand and really want to feel like I’m buying it directly from them. I’m going to get that direct support from them.

And so with that, this is something that we have been able to, um, To really build out the capabilities on lenovo. com and bring to them the plethora of products and services solutions that we have to offer the market.  And over the last couple of decades, it certainly has been a very satisfying business.

Like many online stores, we have seen a huge uptick as a result of the pandemic. And since then, we have continued to evolve and create value for our customers through marketing onsite experience, whether we’re talking to a consumer or even a small medium business. Both of whom are target audiences on lenovo.com and so, you know, this business has just, as I said, it has accelerated quite a bit since covid and if you look at our cater growth of the last 5 years, it’s been about 30 percent growth.

So, it’s been quite significant. Interesting. You talked about bombing channel and I understand you offer. Buy on and pick up in Best Buy, which is great because you don’t really have stores, so that’s a fantastic idea.

How did that come about?  Well, being a customer centric organization, we spent a lot of times thinking about what can we do for our customers to enhance the experience? How do we lean into what we learn about our customers and really be where they want to be and allow them to shop the way that they want to shop?

And so we’re always looking for new ways to think about how do we, uh, Evolve the thinking and, you know, this was an idea that we spoke with best by in partnership with them. I think we both had the vision of we want to do something unique and different for our customers together. And instead of looking at ourselves as sort of competition, if you will, we looked at this as an opportunity to collaborate and deliver something that we knew was going to lean into new behaviors.

We are seeing as part of the pandemic. So, you know, during the pandemic, and that’s when this all came about. People couldn’t go in retail stores, right? They were all going online. But they also wanted the speed of getting what they wanted very quickly. So this kind of brought both of those together very nicely where they could come to Lenovo.com.

They could see everything that we had to offer, make the purchase, but then they could just go to their store and pick up the product. And that was something that we always thought about is how do we get the product to our consumers as quickly as possible? And at that time, we were imagining, well, wouldn’t this be cool if they could actually just go pick it up and get it in the same day.

And now that we’ve done that, and it has is proven to be quite a successful program for us. And in fact, when you look at some of the market data, some are saying that they expect this to be about a 700 billion business in 2027. So definitely the customers are telling us there’s a lot of value. And this type of an engagement type of solution.

And so, you know, we’re now thinking about well, if we’ve done this, this is the next milestone is how do you create a situation where a customer can buy from Lenovo dot com and actually have it delivered to their doorstep within hours. And this is where Amazon has, you know. You can either say they’ve helped us or hurt us, but they’ve done a lot in this space and really set the bar quite high for us.

And so some of this, I think, is becoming table stakes in the mind of a lot of consumers today.  It’s kind of interesting because if something happens to your computer and you have to get a new one, like, you want it now, you don’t want to wait. So I love that. And you’re so forward thinking about that. So I think that the tech industry overall has been very interesting.

We’ve seen a drop in the U. S. market overall with revenue and specifically electronics. Um, and we’re, this really coming off the pandemic and I think, you know, part of this is, you know, a lot of people beefed up on all their electronics during the pandemic and, you know, now they’re not buying as much, but Lenovo is a market leader.

If my numbers are correct, I think you own nearly 25 percent of the global PC market as of last year, but.  The big challenge in the industry is it’s not like fashion apparel where, you know, we purchase, we make frequency, we go and we visit our stores, we buy lots of stuff, we keep going back. I mean, for some, you know, in the, in the fashion industry, it’s, it’s a constant, you know, purchasing frequency.

But in the computers, you know, it usually, you know, I don’t know, it’s probably every few years.  And I know you can sell ancillary products and that type of thing, but in general, it’s a low frequency purchase. And so that presents its own unique challenges. Can you tell us about this quandary and how it impacts overall revenue?

Absolutely. And, and, you know, we see this as more as an opportunity for us and something that we’ve been working on for a number of years. When I first joined Lenovo 15 years ago, You know, we were looking at how do we create stickiness with our customers? We really want to put more, more of a balanced focus on retention versus always on with acquisition.

And, you know, one of the things that we realized was that, well, this is a purchase that people are making every three, every four, in some cases, every five years now, there are a small group of people, I’d say a segment of our audience that we consider the tech enthusiasts and they always want the latest and greatest, so they will always buy.

And they don’t, you know, they want multiple products. Um, but the average consumer doesn’t necessarily fit that bill. And so one of the things we’ve been really looking at is how do we find that opportunity to bring in some of the other offerings that we have? And we have a very broad portfolio, much larger than most people think.

And so, you know, we had to think about how do you craft the storyline and think about the offerings and how do you match them with a customer journey? If they’ve just purchased a product. Let’s not go and try to sell them more product, but let’s take a different stance where we’re showcasing some of the other offerings that we have, or just having more of a conversation where we’re offering them some information tips and tricks, et cetera.

So we’ve really tried to be very strategic about how we approach this.  But interestingly enough, despite all of that, you know, about 45 percent of our sales are actually coming from non PC, which I think a lot of people are surprised about that data point.  And so I think that does come from the decisions that we’ve made as a brand in terms of bringing in different offerings to our portfolio.

It’s not just PCs anymore. It’s so much bigger than that. And we also have other capabilities that we’ve built for our customers. We have online communities for some of our core segments, gamers, students, small, medium businesses, where we invite them to come in and it’s, it’s not about selling at all.

It’s really about just having conversations. It’s about sharing with each other. Some of the challenges are some of the cool things that they’re doing, and it’s an opportunity for them to not just only talk to the Lenovo brand, but also we bring them together and they talk to each other.

So these communities are starting to build a life of their own and really taking on an organic shape to them. Which is really interesting, but that helps us then, as we look to engage with new customers, because they see what our existing customers are talking about, and it keeps bringing them back and it keeps introducing them to what Lenovo is doing new innovations that we’re bringing to market.

And it brings that excitement. And I think all of that sort of helps bring a certain level of authenticity and relevance to what we’re doing and people want to keep coming back to the brand. So those are ways that we’re, we’re iterating to how do we. Bring that relationship much tighter and make it more of a long term type of relationship with our customers.

Well, I would just about tips and tricks because that really ends up building a community, right? And so now  that’s great. Um, tell us a little bit about the partnership with BlueCore and maybe you can start by telling what they do.  Sure. So BlueCore is a technology company that has really helped us increase the frequency by which our customers shop.

And we do that as a way to expand their pool of repeat buyers. So they’ve been able to help us bring forward the right offerings, help us understand through data and digital language, What other accessories or ancillary products, or even maybe complimentary products that we can sell to a customer who’s already purchased.

So, instead of, you know, Somebody who just made a purchase of a PC, we don’t want to offer them another PC. We want to offer them something that makes sense to them based upon the purchase that they’ve just made. And so this is a way for us to not only drive that repeat purchase, but it also helps us bring more knowledge of the broad portfolio that we have to our customers.

I mean, most people wouldn’t know this, but we sell office chairs. We sell light bulbs, um, smart products. So lots of things that you might not realize were there because in our typical marketing, these are not the products that are, that are put front and center in front of customers. But when you’re talking about a re engagement of a customer, these are the types of products that are ripe for that sort of conversation.

And so Bluecore has given us the opportunity to bring that into the fold. And we’re able to do this in a way that’s truly 1 to 1 for a while. We’ve been talking about personalization, but a lot of us, I think we’re doing personalization more at a segment level, right? The best you could do is group people, whether these are gamers or students or what have you, but now we’re able to say, well, Sally was on the site and she was looking at this think pad product and we’ve got a monitor that would go perfect with that system.

We can bring that up and blue core allows us to deliver that. Yeah. Right person, right time, right message, right? Sort of the old adage of marketing. And this is what we’re here to do, but we’ve struggled in recent, in past years to be able to do that effectively and efficiently, Blueport allows us to do just that.

No, when we’ve talked before, you’ve talked about this idea and you’ve been in marketing forever. You’re like an expert in marketing. So, uh, so there’s consumer versus channel marketing. Can you just touch upon that?  Absolutely. And this is something that I’ve been espousing for a number of years. And so it was so refreshing to see a technology partner start to think the same way, because oftentimes you’re bringing in tech that really speaks to a particular problem, a particular channel, but Bluecore has a really fresh perspective on how we should market to our customers.

The customer should always be at the center. And I think sometimes we as brands, ourselves included, Lose sight of that and it becomes more about the technology more about I have a certain number. I have to hit through the email channel or the paid advertising channel. We at Lenovo are really changing how we think about things where we want to say, what do we know about this customer?

We have 3 core segments. They’re not the only people we sell to, but gamers, students and small, medium businesses are areas where we really want to go deeper. And so we, we learn as much as we can about them through market insights, but also looking at the digital language. How are they responding to our campaigns?

What sort of activities are they doing on the website? And how do we take that and marry that to business goals, but also the needs of our customers. So blue core has helped us with that in that they’re able to translate those customer insights into communication strategies, taking a non buyer to make them a buyer.

A buyer who buys 1 time and drive repeat purchases, and then ultimately to make them a loyal buyer, which is the ultimate goal of what we want to do. And so this is where you start to not think so much about targets in 1 channel, but you start to look holistically about your marketing investment. And the return on that investment and you look at it more from a customer level to see how they’re progressing with you and look more at customer lifetime value, looking more at metrics around retention and repeat customer.

Um, those are things that historically we weren’t looking at. We were like many brands looking at the top line only.  So true. Oh my gosh. I love that journey. It sounds like they’ve really helped inform some of your marketing strategies, which is. That’s great. And the personalization is really the key. So that’s right.

Our list, our listeners know I love numbers and statistics, so I’m going to ask you, uh, can you share some data points with us about, you know, what, what you’ve learned and why this is so relevant in the new world of marketing today?  Absolutely. And we’re really pleased with the numbers we’ve seen to date.

So we see about a six and a half percent increase in our repeat buyer rate, which has led to about a three and a half percent increase in retention. Um, when we look at marketing attributed revenue for this program specifically, we’re up about 28%.  Um, overall the email channel itself has outpaced most of our other marketing channels.

We’re up about 20 percent year on year. And this is just early signs. Like we are still very much in the infancy, I would say. You know, we, we, we’ve made a lot of change in the last year and I know the teams feel like they just, they kind of made it over that mountaintop. And I think we still have a lot of room to grow.

And that’s the, we’re excited about the opportunities of what we can continue to do with blue core and leveraging their capability to make this  a really massive program. For us internally, but also from a customer point of view, I think we are now more than ever delivering on the promises that they’ve given us data.

They’ve trusted us with that information. And now we’re using it in a really intelligent way to give value back to them. Um, so I think there’s benefits from a business perspective on a commercial side, certainly benefits from the customer. And then we also see in terms of efficiency. You know, we used to run these programs more of an, a manual process.

It would take us hours, if not days to run one single campaign. This all runs automatically. And so it’s cut down on our manual labor time significantly, which then allows the teams to put more thought into strategy. Who are the customers that maybe we’re not reaching today that we want to go target? How do we think?

More authentically about different ways to talk to them and put more efforts into content, which we also know is, is one of the bigger opportunities for marketers today. So I think it’s really reset how we think about engaging with our customers. Reset how we think about marketing and this channel in particular, and really start to take more of a holistic approach.

It’s impacted our processes.  In a positive way, it’s impacted, I think, to some extent, even how we organize ourselves and how we collaborate across teams. So it’s been a really nice journey to see. And I. I remember 10 years ago, having this conversation with people and people saying, well, this, I don’t see how that’s possible.

Like, we don’t have the ability to do that. So, again, it’s been really refreshing to see that we have that capability today. And that’s the exciting thing about marketing  and those numbers are very impressive. So the work. That you’re doing, it sounds really incredible. And, uh, what do you see for the future of Lenovo?

Can you give out your crystal ball out and tell us what you see with the future?  I think, um, you know, we’ll continue to see acceleration of the digital capabilities. AI is a big one here, right? We can’t have a conversation without talking about AI. Um, I think that, you know, as as much as we’ve made some good strides, there are always going to be challenges with scalability.

Um, today for many companies, certainly us, the only way we can do more or solve a problem is by throwing more people at it. But we all know that that’s just not, that’s not, you know, doable from an expense perspective. So I think AI is going to help us with those efficiencies, but I think it’s also going to allow us to drive more value for our customers.

Because now, as I said, I can spend more time thinking deeply about what do I know about students? Where are the gaps? What do I need to fill in to really give them a rich experience? And we’re thinking about it, not just in terms of across channel and thinking about it holistically. We’re also thinking about it in terms of the web channel.

So connecting the marketing with the onsite experience. Like many companies, Lenovo is organized in somewhat of silos. You have the marketing team, you have the UX team, you have the merchandising team. They didn’t always talk to each other. They were busy in their lanes doing their thing.  Which is fine, they’re all meeting their goals, but from a customer lens perspective, Not necessarily ideal, right?

Because you can get very disjointed messages, disjointed experiences, customer can get lost. And now what this is forcing is a different conversation internally where we’re now collaborating operating more in what I call tiger teams where you have representatives of different teams working together. To say, okay, what’s the problem we’re trying to solve and how do you get everybody working on that same path and rowing the boat in the same direction?

So now we’re working with our UX team to test personalization on the site, marrying the campaigns that we’re running and other channels, particularly with blue core. And so now a customer gets exposed to a campaign and they see it get paid off. With more information when they get to lenovo.com. So that’s the evolution that we’re already starting to see.

And that’s what really excites me because we’re really starting to think more deeply about the customers we’re here to serve. You’re so  right. Our industry is so siloed. And I keep thinking every year, okay, this is the year that we’re really going to break down those silos. And it’s difficult.  Change. So it’s great to see the work you’re doing and thank you so much for being on the podcast today.

It’s awesome having you.  Thank you for having me. I really enjoyed the conversation. I love, you can tell I’m very passionate about marketing. I’m passionate about this stuff, so I could talk about it for hours.  Well, thank.  And for our listeners, uh, next week, very exciting. We have the chief merchant, uh, marketing officer for Ulta beauty on Michelle Croson Matos, and she’ll be on to talk about the joy project.

And we’re going to do a deep dive into that, which is a really amazing program. So thanks so much for everyone. And, um, if you have any ideas, please make sure to go on the website under contact us and share any ideas you have for podcasts or any other feedback you want to give us. Thanks so much. Thank you for listening to Retail Unwrapped.

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