When it was announced that the Dick Smith chain would close with a deficit of $100 million and nearly 3000 lost jobs (including 430 in New Zealand) its founder, Dick Smith said he was gutted. “I’m very proud that a business I started with $610 has lasted for 48 years and employed thousands of people,” he said. “I’m angry that these greedy bankers have destroyed a business.”
Soon after we heard that Kogan, Australia’s largest online department store, would buy the IP assets of the company – namely its brand and the databases built up in various ways over those 48 years.
It’s hard to guesstimate, but I’m going to take a stab that there were 150,000+ New Zealanders on that database.
When Kogan took over last month, he said he would invest to rebuild consumer trust and make Dick Smith’s online offer “better than ever.”
What has happened is that he is not only destroying any brand equity that he’s just paid for, he’s incinerating the latent revenue and future brand value that lurks in the database he’s bought, and the thing that kills me the most is that the opportunity cost is huge.
Background: The receivers sent an email mid-March offering to get subscribers off the hook by unsubscribing before Kogan (or ‘the new owner’) took over the data assets – some people probably did, the majority would not have.
First: What could have happened. I can hand-on-heart swear that you could have built a re-engagement communications plan with an aligned content strategy, gentle tone, and good manners that would have unlocked the forlorn hearts of Dick Smith’s Kiwi database and unlocked their wallets too, pouring cash into the coffers of Kogan and his suppliers.
But, what has happened? Kogan has sent a series of emails since the first week in May that have been an example of worst practice digital marketing.
Nice to meet you, Kogan! The first email was the one in the header image above – screaming free shipping. No introduction, welcome, explanation of what was happening, nor was there any setting of expectation as to frequency of the emails, value contained here-in or on its way, no loyalty incentive, and also no options to choose to opt-down how many emails I get or to opt-in for particular content categories. No reassurance, reviews, testimonials or credentials from Kogan to build trust with me.
The emails are also 100 percent untargeted and there’s no dynamic content inserted for New Zealand. The most simple of email marketing software e.g. Mailchimp, can swap out content blocks based on data fields, so if Roanne is in New Zealand, then the intro, pricing and products can show New Zealand content. Rather, all references are to Australia. For example: Australian time zone, Australian currency, Australian shipping offers, Australian phone contracts and mobile carriers, Australian brand promotions (What’s a Kogan blender?) this thing is so Australian I swear when I read it I can hear an Australian spruiker shouting at me from a shop doorway. Strewth! Look at this for a phone deal!
I’m still going: look at the Australian URL in the header ‘DickSmith.com.au’ and see below the Australian contact address in the footer, along with a subscribe statement that says I’m getting this email because I am on the Dick Smith Australia database. Ugh. No I’m not, and I’m hating you right now.
After searching the website for 30 minutes, I can say that the Dick Smith website doesn’t contain even one sentence regarding New Zealand shipping options, T&Cs or any mention of New Zealand shipping at all.
I’ve had an email every second day since May, I’ve tried to hang in there to see them catch on and get better.
No. They have all shouted at me with a strong ‘strayn’ twang. Instead, they have shouted ‘P*** off Kiwi, there’s nothing for you here.’ Look! A Kogan notebook. What is a Kogan notebook?
What a waste of years, money, brand, acquisition campaigns, thoughtful customer service, the huge effort it took for generations of DS’s New Zealand staff to tempt, cajole, buy, promote, earn those names on their database. Not to mention the business’ growth journey with the actual Dick Smith.
Kogan, I can’t see any sign that you are not a pack of idiots. Clearly you are not, or you would not be Australia’s biggest online department store. But right now, this feels like it calls for the CRM version of abuse intervention. Kogan! Give me that database cobber, you don’t deserve it.
P.S. I like Australian people. I lived in Melbourne for 10 years, I love it, I miss it and I don’t even mind the odd spruiker for old times sake. But I am not there now, nor was I when I joined the Dick Smith database. I have no clue who Kogan is, and I really am very sad about what they are doing to Dick Smith’s customers.