What’s the best approach to the marketing challenges of our brave, new world? What rules have changed? And how do you adjust? After interviewing some of the best marketers in the game, I’ve come up with a list of expert tips for deploying new strategies, changing your culture and measuring ROI.
Our experts would encourage you to pick a single channel, business unit or customer segment. Learn first, then deploy at scale.
Progression or maturity
Once you have clean data and mastered basic analytics, progress to predictive analytics. If you have a good handle on structured data, expand into unstructured. If you are using a limited number of data sources, evaluate and plan to use more. Focus on improving your understanding of behavior and getting to more accurate decisions – ultimately in real time. Try and do everything at once and you risk overload.
Test and learn
Whether your deployment strategy focuses on scope or progression, the key is to use a test and learn approach. In the absence of evidence or facts that prove success, others will try to put a damper on your initiative so that money and resources can be transferred to them. Beat them to the punch and prove success sooner rather than later.
Without the right culture, or tone from the top – you won’t get the best lift on your investments. Your initiative will take longer to implement and you will end up spending far more time dealing with internal politics.
This is the biggest stumbling block for most organizations – particularly when it comes to embracing social marketing. Think of it as “this is the way we do things around here.” If the culture in your organization is driven by personality and gut feelings, introducing analytics for data driven decisions will be a challenge. Pay attention to the importance of “change management”.
There were three basic qualities our experts look for. The first spoke to a person’s ability or willingness to change and adapt. The second, as Jim Foreman called it – a person’s analytic curiosity. The third was a person’s understanding of the core business. The rest can be taught or bought in.
1. Move from a product to a customer centric structure
2. Remove channel and or business unit siloes
3. Consider creating a shared “analytic center of excellence”
Communicate more. One stakeholder that came up time after time during the interviews was the CFO. Another can be described collectively as “whoever you impact”. Involve all of them sooner, rather than later – don’t wait until everything is perfect or complete; and don’t assume that once communicated, it will be understood. Repeat it, test it, prove the message was received and understood.
Experiments & failure
Through a series of disciplined experiments, you need to get better at predicting outcomes. Technology can help, but there is inherent risk – particularly in the early days. A good result can either be a success or a quick and inexpensive failure. Make it safe to fail otherwise few will ever risk trying anything new.
Measurement, value & ROI
Don’t get hung up on the present – think bigger. Marketing is about driving profitable growth today, tomorrow and well into the future. Measure the trend or progress on that dimension. Customer Lifetime Value is a key measurement in that respect.
Approaches to avoid
Logic vs. loyalty
Three examples were provided that sounded logical from a corporate perspective – all were designed to improve profitability based on demand. Logical that is until you think about the experience and emotion created within your customers mind.
Always question which is better – making an extra dollar today, or keeping customers loyal to protect revenue tomorrow.
Logic vs. profitability
Never assume that standard accounting logic is perfect. It may stack up in aggregate, but when you look at specific customers or segments – it’s a whole different story – 20% of customers could be destroying up to 400% of profit. As marketers get closer to a “segment of one” – it pays to sweat the details and challenge basic assumptions.
Changing the rules during a recession
During the first wave of the 2008 recession, Staples decided to pull back on acquisition and focus on retention. There were two basic lessons learned:
- No matter what you do, you will always have some customers that churn. Without an acquisition plan, that means a shrinking customer base.
- Incentivizing loyalty amongst your best customers via discounts or coupons effectively undermines your margin on products they would have bought anyway.
Underestimating the importance of training
Think through the basics. How are people going to use new information? How are they going to share it? Who is going to have access to it? How will it fit within existing processes? And how will you ensure consistency and alignment? Put together a training program to ensure everyone is on the same page and can fully leverage the potential of your investment.
Expecting one tool to do everything
Squeezing every last drop of value out of a single technology investment rarely makes sense. They may be good at one thing, but poor for others. Chose a solution, suite or combination of tools that deliver on all your objectives to maximize value.
Ensure they are relevant and timely – otherwise you risk losing a customer. Fail to identify and adapt next best actions in real time (within your interaction) and you are likely to miss an opportunity that may be difficult to introduce later. Embed real time analytics into your processes for improved decision management.
Approaches that exceeded expectations
Use analytics to identify and explain hidden patterns in your existing data. Constantly challenge existing assumptions; search for the unknown and don’t be afraid of experimentation. Three areas were explored:
- Understanding behavior.
- Knowing your customer and consumer.
- Empowering employees to reach out via social.
For more, read the white paper Driving Profitable Growth: Best Practices and Lessons Learned from Marketers, or check out the full four-part series.