Manhattan Marketing Maven

I'm Moving to My Own Blogging Site

2006-02-23T14:13:00.000-05:00

www.ManhattanMarketingMaven.com is the new home for this blog.

After more than a year enjoying Blooger/Google as my host its time to have my own site and upgrade the funtionality of my bloging system. So now I'm a Go Daddy and Typepad blogger!

I hope you will continue to keep up with my take on real life advertising and marketing issues.

New Versus Old Media Manipulation

2006-02-15T21:35:00.000-05:00

Two closely placed stories in the Media & Marketing section of the Wall Street Journal point out the significant differences between old fashioned interrupt media and online opt-in media.

The February 15th advertising column celebrates a media scheduling innovation in which American Express ran three separate 30-second spots back to back during “60 Minutes” on CBS, “Lost” on ABC and “Law & Order on NBC.” In so doing they grabbed 90 consecutive seconds of attention from whoever was watching that commercial pod.

Radical huh?

Taking the classic TV “roadblock” (running the same spot at the same time on several stations/networks) and making it vertical gave AMEX the video equivalent of multi-page magazine spread. Net net – this breakthrough maneuver created a greater than normal shot at reaching and engaging target audiences.

That’s what it’s come to – when TV actually gets a homogeneous desirable group of viewers on one channel at one time you gotta leap all over them; at least those of them not in the bathroom, not in the kitchen or not using their Tivo.

Compare this amazing new wrinkle with the facing story on Daily Candy, a series of 11 daily, opt-in one-page newsletters aimed at fashion-forward younger women which was created by Dani Levi and sold in 2003 for 3.5 million to Bob Pittman of AOL and MTV fame. Now Bob is peddling this mini-empire as a targeted content play. It is expected to attract bids as high as $100 million.

Compare the massive run up in value of a highly targeted, vehicle where readers decide which content they want and when they want it versus the need to manipulate the biggest cumulative audiences on broadcast TV to get a little attention, awareness and recall.

Why Ad Agencies Can't Respond to John Stratton's Warning

2006-02-13T09:38:00.000-05:00

Verizon Wireless CMO John Stratton went to Ad Age’s “Hollywood and Vine Conference and told the 400 ad agency poobahs what every client in American already knows -- the ad agency business is overwhelmingly focused on itself NOT on clients.
His eight point indictment explicitly articulated what many clients have been thinking for quite a while. His points were …

1. Your clients are absolutely in trouble and they are looking for you to save them.
2. What you've been selling for the last fifty years no longer works.
3. Major marketing money is going to be in motion in the next decade and no one really yet understands exactly where it will land, if it even will land, or if it will just disappear altogether.
4. Before they figure out where to put their money, your marketer clients will hire and fire agency after agency, seeking someone, anyone, who can tell them where they might go next.
CMO average tenure, already famously brief, will get even shorter as CEOs begin to recognize how much money they are blowing on antiquated media plans.
5. Your marketer clients are really seeking one thing and one thing only: An audience for the message they are trying to convey to the market place.
6. But your clients actually need more than just an audience. One of the consequences of the evolution of our media delivery systems over the last ten years is that the audience you do ultimately find is much less receptive to the message you're trying to send.
7. They are absolutely armed and ready to get to the content they want while avoiding the message you are trying to implant within it.
8. They need much more than an audience. They need an audience that cares about what they have to say. They need their message to be relevant to the audience they are saying it to.

Yet the real question is not whether agencies can hear the message. The real question is whether they can do anything about it. Consider these points that suggest that agencies are so far out of alignment that they will NEVER BE ABLE to answer Stratton’s clarion call.

1. Agencies have very thin subject matter expertise. They know damn little about the business and even less about the interior structures and processes of their client’s businesses. Long shut out from strategic councils and often only linked to the Marketing Communications department, they just don’t know how the client’s business works, what the levers are or how to influence the demand drivers or the dynamics of the supply chain.

2. Agencies are in their own way. Locked into bureaucratic and hidebound processes to conduct market research and produce TV commercials, they have little understanding of trade relations and even less understanding of relationship marketing techniques and the evolving new media used to communicate with a diverse, dispersed and distracted set of target audiences.

3. The holistic and integrated approach is a whole lot of bullshit. The TV and print guys rule. They give lip service to online and emerging media but they don’t get it. Adding an 800 number or a URL to an ad is still considered a slight to the creative team. The notion of sequencing, simulcasting or integrating messages or audience segments among media is a foreign idea which is perpetuated by siloed departments and competing units. Even at the holding company level, very few campaigns can bring a sophisticated, multi-channel campaign to life in a way that measurably impacts client’s business.

4. They think the whole game is the message. They don’t get the notion that advertising and marketing is about throughput – finding, engaging, qualifying and incenting likely customers to buy. If a commercial tests well or the placement gets decent ratings they are done. Bringing customers through the pipeline is outside their worldview.

5. They measure the wrong things. Clients want to know what they got for their marketing spending. If they spend $10 they want to know if they got $100 in business in return. Agencies don’t have access to the data or expertise to count and measure the impact of their work. Instead, agencies want to talk ratings and recall scores. But don’t ask about the efficiency of their processes or how much it costs to create an ad with 30 words of copy and a photo.

6. They can’t make money any other way. Agencies are locked into production processes, project management procedures and cost elements that prevent them from changing. Having been hammered into commodity pricing and benchmarked to death during 3 years of recession, agencies can’t afford to find or hire the new expertise they need to survive. The people who run agencies still think they are living in the Oglivy and Bernback era. In fact most of them came up during that period and have been befuddled ever since. And frankly the kind of people they need would never be caught dead working in a traditional ad agency where a few egos rule the roost, where there is zero training or career development, where technology is several generations back and where there are few players with advanced degrees or specialized skills.

2006-02-08T11:52:00.000-05:00

Blow Up Your Own Marketing Plans!

2006-02-05T15:38:00.000-05:00

Marketing exists to identify, speak to, connect with and prepare prospects to buy. Everything a marketing department does -- from creating the logo and the brand promise to the ads, e-mails, collateral and t-shirts is designed to achieve this goal. Yet too often marketers fall in love with the marketing programs and under deliver qualified sales leads .

Why ? Two good reasons.

First many marketers don’t have the data to see what is going on. They are devoted to their newsletters, their webcasts, their roadshows or their white papers which they fought tooth and nail to create, fund and coordinate internally. They don’t have access to the sales pipeline or don’t carefully mine the CRM system to see what is working and what is not.

In some cases they measure satisfaction with the tools but don’t measure how these tools drive prospects through the pipeline. They know which webcast was liked the best, but they don’t know how many of the webcast viewers turned into closed deals or when.

Consider the example of a marketing team that built an information portal aimed at their target prospects. They assumed that there was a hunger for information about their sector and they figured that if their brand provided this information, prospects would be more open to buying from them.

Over 2 years they invested time, people and cash heavily in collecting, editing and displaying every bit of content they could find. They built a huge content archive and a database of 200,000 names and invited them by e-mail to visit the portal every month. In a year they delivered 2.4 million targeted impressions beckoning prospects to drink from their font of information.

Recently someone crunched the numbers. In 2005 less than 2000 of the 200,000 came to portal and read something. Fewer than 200 came back 3 times or more. And nobody knows if any of the 2000 were customers, were promising prospects or had anything to do with the organization’s salespeople. Now there’s anxiety in marketingland and the team is reluctant to change or abandon the portal they fought so hard to create and maintain.

Second, it is so hard to get anything done in a large corporation and the emotional investment is so great that marketers become prisoners of their programs. Getting an idea through a matrixed bureaucracy requires enormous effort, time, adrenaline, patience and political finesse. Nobody whose been through the process is about to blow up their end product and head back into the fray willingly.

A different team of marketers developed a sophisticated scoring system to filter, rank and interact with web visitors. They developed a credible marketing program and drove 60,000 leads into their pipeline based on the scoring model. They presented these results to the board and everyone got a bonus.

Then someone began to go through the numbers. Half of all the leads that were identified by the scoring model turned to dust in the tele-qualification process. Another 15 percent turned to dust early in the first real interaction with salespeople. The program was onto something but it was far less effective than advertised upward. Nobody was willing to spill the beans or jeopardize their new-found status and few were willing to re-jigger the model which they'd touted so heavily.

Yet if marketers are going to successfully fight for more resources and fight for greater visibility in the corporate decision -making process, continuous process improvement has to be their mantra. Marketers have to become more mercenary in assessing and editing the programs and ideas they bring forward.

It’s about the end result. It’s not about how cleaver, elegant or unusual the marketing tactic is. And with the growing use of CRM and automated marketing services, it is becoming easier and easier to understand and measure throughput.

A relevant metaphor is Ariel Sharon, the comatose Israeli prime minister, known for quickly abandoning tactics in service to a larger strategy. Sharon never fell in love with the trees but he consistently focused on the forest.

He built and then dismantled settlements, invaded and then withdrew from Lebanon, swung far right then zigzagged back to the center each time dumping programs he himself constructed and advocated. And while the jury of history is still out, most Israelis believe he has advanced their cause and protected their security better than anyone.

In a measured universe, marketers have to keep their eye on the ultimate measurement – closed deals. They must track their contributions against that metric. The most successful marketers will be the ones who keep their eyes firmly on the sales prize and regularly blow up their own tactics.

New PR Tactics for the Word-Of-Mouth World

2006-01-22T16:31:00.000-05:00

Bloggers are opinion leaders. They can influence brand awareness, set customer expectations and reward or punish service delivery or lapses. I buy these arguments. What I’m not sure about is how to address them to get the best spin for my clients.

In one instance, I searched Technorati, Ice Rocket, Sphere and Google’s Beta Blog Search tool to identify people blogging in our category, industry or product category. I built a list of 65 people and personally e-mailed each of them. I wrote a straightforward e-mail identifying myself as a representative of the company, soliciting their opinions and offering a free product trial. Five responded. Three took the trial. Nobody wrote a syllable about our product.

The next time I sent the same universe a press release announcing a product innovation. The release resonated with several trade papers and consumer reporters. My “press” mailing yielded several inquiries, a small wire service story and three product reviews in desirable specialty magazines. The bloggers remained on radio silence.

Since then I’ve been mulling the problem – how do you reach out to and influence bloggers who can in turn influence your customers and prospects?

Then I read an essay by Andy Sernovitz on iMedia Connection which opened my eyes to a radically different approach to these citizen journalists. He essentially argues that you need to join their party rather than invite them to yours. Like journalists, bloggers set their own agenda. Those seeking to influence the agenda have to intersect it on its own terms. Influencing their posts and their audience requires following their threads, commenting on their posts and presenting your product or your point of view in their context.

You still have to be forthright, upfront and clear about who you are and who you represent. You cannot disguise yourself or pretend to be an uninterested civilian inserting product or brand references. But it’s about aligning what you are pushing with what they are thinking, talking and writing about.

Sounds right doesn’t it? I’ll give a whirl and report back.

Google Threatens to Change Media Buying Forever

2006-01-18T14:11:00.000-05:00

Google’s purchase of dMark Broadcasting will bust open the media world. Attaching the AdSense easy-to-use interface and auction engine to the inventory of America’s 8000 radio stations will put local advertisers on a par with national players, disintermediate all the mediocre media buying shops and force the big media buyers to circle the wagons and take aggressive, proactive steps to protect their TV buying cash cow.

The simplicity of the move is elegant. Think about the value of Google’s functionality. AdSense helps almost anyone get their arms around a dizzying array of details. It takes 20 minutes to learn how to use it and the navigation is intuitive. The dashboard is easy to read and easy to change. Sites, audiences, sizes, creative, prices, placement and yield are all easily and sequentially managed and displayed. The details of radio buying are equally confusing.

But it’s a no-brainer to manage format, audience demographics, daypart, length or creative execution. [DF1] And while the Google interface won’t necessarily handle production or promotions, it could easily cut out the middle man for thousands of retailers and small businesspeople who could benefit from radio advertising.

Keep your eyes on the National Association of Broadcasters and the Radio Advertising Bureau to see if the radio industry is for or against this development. Radio guys can truly benefit from this development but every so often they cut off their noses to spite their face. It’s a fair bet that they will initially reject Google as a show of loyalty to their longstanding reps.

But the writing is clearly on the wall. Google has a way to make sense of a billion little media details. You can make your own strategy and price decisions. You can track results in real-time and adjust on the fly. And if you don’t want to do it, a very junior person can in minutes per day. Who needs a middle man to take a cut and annoy you along the way?

And if Google can manage radio – notoriously hard to keep track of and labor intensive even for sophisticated media buying firms with extensive relationships and high-powered software tools, just imagine what they can do with cable or local broadcast TV?

Jeff Lanctot of AvenueA/Razorfish kicked off the pre-emptive defense in today’s Wall Street Journal by saying “ The traditional media world is a very relationship-driven marketplace. You’re supplanting personal relationships and replacing them with technology and that’s a pretty daunting task.”

Right. But only if you are a media buying firm like AvenueA with a practice to protect.
Stay tuned. It’s about to get interesting.

Ad Agencies Are Groping for Relevance

2006-01-14T21:08:00.000-05:00

Adweek and Ad Age announced their picks for Agency of the Year this week. They both picked BBDO and Crispin Porter & Bogusky for snappy ads and new business wins. Ironically Jaffe Juice reported that some of the most notable interactive work from the highly touted campaigns of the winning shops was actually jobbed out to smaller interactive creative shops.

The choices document the on-going confusion and struggle among ad agencies to get out from under an ancient ruling set of creative and media assumptions and a business model that is near death. And even though Bob Greenberg of R/GA has been a Jeremiah preaching the need to integrate disciplines, abandon internal bureaucracy and aim for different creative horizons, he has been generally ignored in spite of the success of his agency in competition with those who cannot or will not change.

Long absent from clients’ strategic council’s ad agencies are flailing in search of staff, direction and new clients. Ad Age’s annual report card documents the revolving door of clients, staff and leaders. direction and some meaning point of differentiation. In a business with no barrier to entry, tiny groups of creatives are stealing global assignments from arthritic networks that can’t get out their own way.

Trapped by 1950s era business processes, underinvested in technology and still very bureaucratic, agencies are unable to move quickly, integrate emerging media or be transparent on pricing or running costs. Seeking direction, leadership and meaning differentiation, we are watching the last dinosaurs gathering around the last watering hole waiting to lie down, die and fossilize.

How To Get More Leads from B2B Websites

2006-01-07T16:06:00.000-05:00

There is a movement afoot to make B2B websites more productive demand generation tools. It’s about time. The key to prospect engagement is focus, perspective, content and ease-of-use.

You have 15 seconds to “hook” a prospect who is busy and is clicking through because something prompted him or her to find you. From the first nanosecond they hit your page, it’s your game to lose. Anything not clear, not easy, not obvious, not intuitive or anything irritating prompts an exit click.

Remember nobody is buying on the first visit. So the website must be geared toward the beginning of, what you hope will be, an extended selling conversation. Unfortunately too many sites are geared toward the end game.

The principle objective of that first page view is to quickly and persuasively communicate
• Who you are
• What you offer
• What makes you different
• Why you should talk to us
• What the prospect should do next

Next can be the next instant or sometime during the next year. The first page they see has to be aimed at engaging your most likely customer. You have 15 seconds to sell them on spending a second, third or fourth 15 seconds with you. It’s the business equivalent of flashing bedroom eyes across a crowded room. It’s not easy, the formula is different for each industry and each buying universe and there is no cyber Spanish Fly.

But there are “best practices” that give you a better-than-average shot at getting and keeping the attention of jittery prospective customers.

1. Create a separate “front door” – a separate home or landing page for prospects. Don’t confuse them with all the stuff your customers, your employees or your investors might care about. At this point they have no emotional or intellectual investment in you or your products and services. They hardy care so don’t overwhelm them.

2. Direct their behavior. You have their attention for a moment. Use UI tactics and design to limit their navigational choices. Point them to what you want them to see, read and react to. Don’t just apply the save navigational scheme as you have on the site your customers access. Don’t get carried away with consistency at the expense of action. Do NOT necessarily mirror the navigation on the client site because it gives prospects too many chances to escape One of my clients had 130 different possible choices on their home page. Wanna guess how many leads they got?

Limit their choices. Layout no more than 3 or 4 navigational pathways and mark them clearly. Typical pathways identify offerings by task, by job function and by product set. Make it easy to find and easy to understand what you offer. Enforce a 3 click rule -- the answer to any foreseeable question should not be more than 3 clicks away. And navigation should be consistent, persistent and interlaced so you prospects can jump from one pathway to the other without having to return to the Home page.

3. Present everything from the prospects’ perspective. Focus on predictable pain points or needs. They care about what they care about. If you intersect their concerns, the door opens a sliver. If not, adios amigo. Often their concerns are based on their job title or the functional responsibilities they have. Usually these are similar across companies in an industry or sector. Anticipate this and display your products or services in ways that speak to prospects’ roles or tasks.

4. Focus on user benefits. Prospect only care about what they win by using your products or services. They are not constantly gazing into their navels and glorying in the features of each product nor are they daydreaming about the latest and greatest refinements and additional bells and whistles baked into the next generation of your stuff. Tell them plainly how what you have will make them faster, more profitable, less hassled, happier, smarter, richer, more productive or more likely to keep their jobs.

5. And before they can discount these claims offer them something; preferably something they will understand as immediately valuable. Make the offer in LARGE TYPE and place it prominently and consistently above the fold on the first page they see.

6. Get prospects involved with the products or services as quickly as possible by using these well established tools and tactics to engage them.

l Trial Use from the Home Page
l A free trial download offer
l A Readiness Survey or Quiz
l Flash tours or product demonstrations
l Comparisons of your stuff versus your competitors
l Product samples or simulations
l Videos of client testimonials and use cases

7. You want to immediately communicate the idea that your product or service gives its users a competitive business advantage. And you need to prove this quickly and persuasively by sharpening the value statements and relating them to prospects’ needs and adding a sense of urgency. You cannot be bashful or reticent. The copy has to be catchy, involving and as promotional as you can be. Take a problem-solution approach to presenting products and their benefits. Images should directly relate to the benefits of using your products or services. Graphics or a grid display of products; their uses and intended users goes a long way to making things clear and easy to understand quickly

8. Prospects will trade data for valuable content but solicit the minimum amount of data to begin a back-and-forth conversation. The more information you require; the more incentive a prospect has to abandon your site and you. At this point there is no relationship and no reciprocal emotional connection. So start by asking just for an e-mail address. It gives you basic opt-in permission and it requires the absolute minimum action and commitment from the prospect. Build-in opportunities to collect an e-mail address at many points throughout the site. Once you have the e-mail address you can ask a prospect questions, gauge his or her satisfaction with your site or your tools and begin to establish if they are truly a lead by assessing their true level of buying authority, need, budget and timetable.

Good luck.

A Different Take on Field Sales Kick-Off Meetings

2006-01-06T09:13:00.000-05:00

It’s field kick-off season. Marketing guys are spinning like dervishes to put the finishing touches on the most important internal event of the year while sales guys are wondering how much higher quotas will be, how much lower commissions will be and if the CEO will come in on a motorcycle and imitate Mick Jagger like he did last year. Yet this annual winter "rah-rah" ritual usually ignores crucial but absent participants – clients and prospects.

The perspective and focus of most field kick-off meetings is internal NOT external. The field kick off usually focuses on what we are selling, how we go-to-market, our calendar of events, our latest and greatest, our new organizational structure, our new bonus and incentive plan, this year’s President’s Club destination and what we intend to say, do and sell to them. It never addresses what tasks, steps, anxieties or constraints prospects and customers face. And so to some extent it perpetuates a disconnect between sellers and buyers.

Even after the second coming of the consultative sell, most marketing and sales organizations still push stuff at customers and prospects rather than integrate or synchronize their activities with what clients are doing. That’s why complex selling is so hard. Sellers are constantly 180 degrees opposite from customers because they can’t align their agendas. Sellers are trying to jump onto a moving train.

There is another way. It begins by understanding that buyers have a definable and often predictable series of steps they take to get from identifying a need to closing a contract. Assuming that a seller can access and influence sellers at each step in the process, sales and marketing teams need to articulate the steps in the buying process and map or orchestrate their messages, activities and resources to the process. Done well this exercise will optimize persuasion and minimize the cost of sale by adroitly deploying the right message and sales tools, using the right channels and leveraging the right people at the right time.

Taking the perspective of the buyer and facilitating the buying process is a subtle but significant nuance. The seller is not attacking the castle. Instead the seller is inside the castle a participant in the process; an advisor with relationships and credibility that is helping to solve customer problems. It is access that is not easily granted.

It also means that marketers must align their messages, their sales and demonstration tools, their media, their events, their websites and their activities on a larger playing field over a longer time horizon – from the initial recognition of need to and through the implementation of a contract and delivery of service. It requires a different tone and manner, a more informed understanding of business processes, an integrated contact strategy and a way to keep track of who is doing what to whomand when. It also demands a set of sales tools and collateral that can be customized by industry, segment, company and individual.

It’s about them not about us. But ultimtely it is much more effective and memorable than the head of sales dressed up like a character from “Men in Black” singing the blues.

Account Profiling -- Best Use of Telemarketing for B2B

2005-12-28T11:52:00.000-05:00

Telemarketing has such a bad rap that B2B marketers often overlook some of its most powerful applications. The term itself prompts a mental image of fat ladies in stretch pants interrupting your dinner robotically reading irrelevant scripts with outlandish offers.

But for B2B marketers the telephone can be an amazing and unparalleled intelligence gathering tool.

Why?

Because the phone creates a magical connection between people which, when you call someone at the right moment, encourages complete strangers to share information and intimacies. The right tone, timbre and phrasing from an unseen, disembodied voice can unleash all kinds of emotions and transactions. The trick is finding and training the right people to make the calls and carefully targeting the calls to solicit discrete bits of information which are then assembled into a mosaic of information.

At Impole Corporation in Waltham, MA (www.impole.com) they call this effort
“account based intelligence marketing”. I think of it as account profiling. They deploy a team of highly trained techies to make dozens of phone calls to targeted titles and named individuals at companies targeted by their clients. The goal is to develop a comprehensive understanding of a particular account so that client sales and marketing people can efficiently tailor messages and offers that are likely to get them in the door, into consideration and into contracts faster with lower costs per sale.

Typically a complex sale cycle takes 6-9 months, involves as many as a dozen people and yields a buy north of $250,000 and/or multi-year contract. An account profiling program is designed to identify the key players, flesh out the organizational issues, surface the BANT (budget, authority, need and timing) qualifying parameters and give marketers and salespeople a feel for the interplay of policies, personalities and politics within each targeted account.

Calls are usually targeted at C level, VP and Director level people though often junior players and administrative people are more likely to tell who does what and who hates whom and suggest who else is likely to be open to a call. There is nothing secretive or furtive about the process. Callers reveal their identities and on whose behalf they are calling. Often one call checks and validates information developed on previous calls. Like news reporters, data is not considered valid unless it is confirmed by two sources.

After a dozen or so individuals are contacted the information is integrated with data found in offline and online public sources to develop a robust picture of what is going on in the targeted company, what they need, what and whom they are considering, how much they have to spend, when they are likely to buy and who will make the final decision. This information is current and much more useful than data culled from lists and an array of other sources. Plus you get current names, titles, phone numbers and e-mail addresses to insure you get through.

Marketers and salespeople then use this information to craft personalized, relevant messages to connect directly with prospects in ways that fit the context, sensibilities and business processes of their prospective customers. Having a robust account profile accelerates the buying process because it cues the most impactful marketing tactics and gives a sales team an incredible leg up in understanding and engaging with prospects’ concerns and decision processes.

Maybe if we use the term “Account Profiling” to separate this intelligence gathering function from the usual perception of telemarketing more B2B marketers will use his valuable tool.

Buying Loyalty -- The Barnes & Noble Approach

2005-12-27T11:36:00.000-05:00

Loyalty marketing has become a game of bribes, rebates, points and promises which forces marketers to sell the perceived value of the reward harder than the original product or brand experience. In a world where only air miles and iPods are universally perceived as useful currency, you have to work really hard to convince skeptical customers that your formula or your bauble is worth a repeat or an upsized purchase.

Enter Barnes & Noble. They don’t give me anything. They sell me, and anyone else interested, a membership card for $25 that entitles me to a 10 percent discount on every purchase and every product in every channel for a year. They get twenty-five bucks. I get as much benefit as I’m willing to purchase.

But the unadvertisized multiplier lies in the way they administer the program. Your membership card is keyed to your phone number. You don’t have to present the card, which my daughter lost in her first 30 days of membership. Instead you give them the phone number at the point of purchase. The computer validates your membership and presto! Your purchase is discounted by 10%.

We gave Allison a membership because she and her pals hang out at Barnes & Noble haunting the graphic novel and young adult sections. In the course of a year she’ll buy 20 manga books at an average price of $15 and another 20 books with words and type at an average price of $18 and she’s good for three $25 gift cards as birthday gifts for friends or cousins and an occasional CD, DVD or snack

The net present value of this 15-year old “heavy user” is roughly $750. B&N gets this purchase level for a marketing investment of fifty bucks (the ten percent membership discount of $75 minus $25) or net 7% of her total revenues. God only knows what the margin on her purchases is.

Yet because of the way the program is loosely administered and because my wife and I and her mother all end up meeting her or fetching her at the store, Barnes & Noble harvests another $500 per year in impulse, gift and gratuitous purchases. So the membership value of a family using this card is $1250 which costs B&N the same seven percent.

This loyalty benefit rings up to the chain regardless of the experience we have in the store, our perceptions of the brand, the competitive set or any added promotional activity or usage stimulation marketing they undertake. Although these factors could increase or decrease the frequency of our purchases.

For $25 bucks they initiate a steady stream of purchases and we walk away feeling good.

Do the math. Multiply our family by 100 or 200 or 500 per store and the membership program becomes a baseline annuity which throws off not only profit but prompts continuous repeat behavior.

I’m not sure it’s replicable, though I suspect that a similar plan might appeal to heavy users of a wide range of products or services. But selling memberships is certainly a cost effective way to buy “loyalty” and a revenue stream simultaneously.

Making Newsletters Work Harder

2005-12-13T21:45:00.000-05:00

Every business seems to have a newsletter. Few have any news. And fewer still contribute to business growth. Most aren’t opened or read..

Why?

Most firms exert too little effort and have too little valuable content. Too much of the writing, design and strategy is done by rote. And while a monthly or quarterly e-mail “ping” might momentarily spark brand recognition or awareness it rarely provokes inquiries or engagement.

The premise behind creating a newsletter is still valid. A well crafted newsletter can establish a brand’s positioning; educate customers and convey thought leadership. It can also prompt and qualify leads, if and only if, best practices are applied.

Here’s the list of newsletter best practices:

Have recipients determine frequency, medium and content preference.

Track readership and serve content based on reader preference.

Customize where possible. Abandon a one size fits all approach.

Offer incentives for pass-along. Solicit ideas and input.

Accentuate your point of view, key executives or products

Aggressively seek interaction. Make it clickable and easy to respond.

Be personable. Write in real rather than corporate nonspeak – blog style

Address industry r competitive issues head on.

Make it fun.

Include a call to action. Give readers something to do in response. Think of your newsletter as an element in an on-going converesation

Handicapping SEO for 2006

2005-12-06T14:21:00.000-05:00

Getting large numbers of likely-to-buy customers at low prices using search engine optimization techniques is becoming harder each day. Harvesting clicks with a high propensity to buy requires increasingly sophisticated strategies and dynamic, real-time tactics.

The market is flooded with keyword buyers that range from the most sophisticated SEO mavens managing thousands of keywords and variations with proprietary software to complete newbies with a land rush mentality eager to get in on the “ground floor” of the newest, best hyped medium. The result is higher prices, lower clickthru rates, less stable top rankings and efforts by the smart money players to find ways to separate clickers from buyers.

According to the Performics division of DoubleClick, (www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc-search-0511.pdf) , the average cost per click increased from $27 to $30 from July to September 2005. Similarly keyword costs jumped from an average of $20 to $26 in the same time period. This reflects, in the opinion of Performics search strategist, “the fact that campaigns are getting bigger and growing across the board.” More marketers are buying more keywords and their variations across more sites bidding up the prices and squeezing the available inventory.

Yet there might be a few bright spots according to Fathom Online (www.fathomonline.com) who reports that keyword prices have declined 11 percent when you compare November 2004 with November 2005. Yet this data reflects only the generic terms (e.g. “shoes”) which most savvy marketers have already abandoned as too expensive and too broad in favor of multi-word customer segmented phrases (e.g. girls black patent leather party pumps). B2B marketers have made a similar migration abandoning the inflated prices of broad terms like “CRM” in favor of narrower technical phrases like “marketing automation and resource management tools.”

Search firms, eager to take in this bonanza, are making more inventory available as quickly as the can. Google separated Adwords from contextual ads, thereby increasing the number of and easy access to more sellable clicks and giving marketers some openings to test new tactics. Look for other leading search engines to follow suit as they slice the salami thinner and thinner in the quest to have more inventory to sell.

Then look for new opportunities to place targeted ads on blogs, RSS feeds, podcasts and web video. Search will remain hot for the foreseeable future and search engines will do everything they can to maximize selling opportunities and to encourage higher bidding.

Just to keep it interesting, Google also re-jiggered the ranking algorithms which make it harder to get into the top positions and harder to maintain top rankings since, on Google, the highest bid does not necessarily yield the top ranking. Others are likely to follow suit because the harder it is to rank number one, the more cash is thrown at the problem. Performics observed that the proportion of keywords that maintain the top rank for an entire month is steadily declining so you can bet that marketers are already husbanding dollars and planning A and B campaigns to insure they rank above the fold, at the top of the right hand paid column or in the beloved blue bar.

Two ideas are shaping the next wave in SEO experimentation and the race for competitive advantage. The first notion is to make clicks more personalized by tracking where prospects click, determining who they are and dynamically serving content or unique landing pages designed to improve the chances that they will convert to buyers. The idea is to match profiles, stored in cookies, to inbound clicks and use these profiles to trigger customized messages or offers.

This is the central idea behind Amazon’s recommendation engine, which has been widely accepted by consumers without too much outcry about privacy or Big Brotherism, and has been baked into their A9 search product. MSN is developing this targeting capability based on the millions of profiles it has amassed through Hotmail, MSN Mail and other MSN features and services though we haven’t seen any real life case studies yet.

In theory persistent MSN cookies, corresponding to customer segments, can trigger select messages aimed at distinct segments, maybe as discrete as segments of one, which will result in more buys per click. In practice, this kind of micro-targeting will reduce buyers’ remorse and holds out the promise of better efficiencies for well crafted SEO campaigns.

A variation would be for individual sites to use cookies to track repeat visitors and use stored data to trigger unique messages. So if you’ve looked around on a particular site, then you come back through a search engine, the site would recognize you as a repeat visitor, know what you looked at previously, and serve up content designed to continue the conversation. The cookie trigger would zero-in on what they inferred you are interested in and engage you in a way likely to either sell you something or convince you to identify yourself.

In theory this multi-channel tracking might mark you as a “hot” lead and/or allow marketers to find several ways to identify or engage you in the course of a complex (b2b) or high value sales cycle. The gating factor is the availability of low cost technology to cookie, track, and dynamically serve content based on a matrix of business rules and inference patterns.

The second idea that could impact search effectiveness is clustering the results to surface relevant results faster and thereby accelerate the awareness-consideration-purchase cycle among clickers. Grokker (www.grokker.com) and Clusty (www.clusty.com) use graphic devices to group and organize the results of a search engine inquiry. In theory a clustering engine acts as a surrogate for the person conducting a search. It gets you to the information you want faster, makes you happier and speeds you along toward buying.

In practice the clusters are still fairly big buckets of content that may or may not correspond to any individual’s interests and intentions. The technology still cannot read and sort everything with equal clarity so often some of the items in the clusters shouldn’t be there. There is no data with which to even guess at the value of this tool in moving people through a buying cycle. Clustering search engines are tertiary players in today’s SEO market.

Nonetheless look for personalization and clustering to be two highly touted SEO tactics in 2006 as marketers seek efficiencies and advantages and as agencies and search engines try to keep the merry-go-round turning and the dollars flowing.

Better Behavioral Marketing

2005-11-28T21:15:00.000-05:00

Behavioral targeting is emerging as a standard expectation for ad targeting and dynamic content serving on the Web. Behavioral targeting promises improved media efficiency and the ability to identify and zero-in on those with a higher propensity to buy.

Yet in this evolving field, there are no clear understandings about what inferences can properly or accurately be drawn from demonstrated behavior. Other than the individual who clicks through to a completed sale, most behavioral targeting at this point is guess work.

Consider several approaches for observing, evaluating or scoring behavior.

Repetitive Behavior

Logically someone who does the same thing again and again or visits the same place repeatedly is probably more interested than the average Joe. Assuming that most people only make one or two clicks in error, it is reasonable to guess that someone returning for a 3rd click is probably interested, if not a real buyer.

My wife is a prime example. She likes to visit future purchases frequently before buying. To her, multiple trips to the shoe store, the furniture store or the big box retailer to hover over her intended item are no big deal. In fact she enjoys the process of visiting and revisiting. With each incremental step she learns more, increases her desire and adds layers of nuance to her buying rationale.

Repetition confirms her interest or ratchets up her intent and her commitment to the purchase. The same holds true on the Web. She will click and click again on an item. Perhaps she’ll visit it at multiple sites in search of greater product detail, to compare prices or to discover a deal on shipping or a favorable return policy.

If we tracked her behavior with a cookie or some other technology, the vital questions would be -- how many visits signal her intent and on which visit should we prompt her to buy? Should we dynamically serve her content or intervene by popping up an offer on her third or fourth visit or on her sixth?? How do we know how much repetition is sufficient to encourage her to convert or at what point she might be freaked out by a big brother intervention and abandon interest?

Sequential Behavior

Perhaps if we watched where she went before and after visiting the product, we might get a better idea. If she visits the same product at a competitor site, does that signal intensity of interest or intent? If she looks at a similar product or a product that normally goes together and sells together with the first product can we infer a pending purchase?

If she puts the cherished item in the shopping cart and abandons it can we assume “No” is not really no? And it is a fair expectation that if you abandon a shopping cart, someone may follow-up with a question or an offer?
What about if she makes a beeline for something? Would that be enough evidence to treat her differently from the great mass of web surfers? Say she responded to an email and clicked on a designated landing page or navigated from the home page to a particular product page in the shortest possible sequence (3 clicks?), would that mark her as an A prospect and separate her from the herd?

Response Devices

How about if she fills in a form, signs up for an e-mail newsletter, downloads a whitepaper, prints out a PDF, uses a zoom feature, puts data into a calculator or clicks a “contact me” button? Assuming that only X percent respond frivolously, would using the provided response device qualify her as a hot prospect or merely mark her as either a
well trained consumer or as a tire kicker?

If she fills in only part of the form, what can we infer? Is a newsletter subscriber more interested than a downloader? Can we distinguish between serial subscribers and sequential downloaders, who could be anyone from your next best customer to a high school kid working on a project?

Direct marketers will tell you that even among those who answer the call to action and utilize the provided response mechanisms; most responders are generally interested but not ready-to-buy. So the act of responding, while rarely more than 2 percent of those exposed to an offer, still doesn’t turn you into a qualified, hot lead or give us any indication that for a little extra effort or TLC we can get you to buy.

So what’s a marketer to do?

Charged with generating demand, we want to do so in the fastest most cost effective manner. Accepting the notion that actions speak louder than words and that people are creatures of habit who often act in repeatable patterns, we buy into the notion of behavioral marketing. But how do we draw the right inferences from the behavior we observe?

The short answer is threefold. First we test and learn. It’s classic but it is limited because we cannot project our learning across product sets or categories. It’s even better if we can share data with each other, make generalizations and hypotheses based on products, categories, dayparts, gender and other psychodemographic factors and get collectively smarter at reading the digital tea leaves

Second, we watch behavior over time. Assume that somebody who does the same thing or related things over time is more interested that the person that does it once and moves on. As a corollary, assume that someone who accesses or responds in multiple ways or at multiple, different times is more interested and has a higher purchase intent that a person using only one media channel. If we collect data from multiple channels (web, e-mail, search words, trade shows, purchase history, coupon redemption, etc) we can begin to see patterns that will suggest how we can weight and model observed behavior.

Third, we aggregate the varying dimensions, try to weight them by watching what prospects do over time and then attempt to triangulate purchase intent and intensity. This applies particularly to high value, considered consumer items (cars, stocks, diamonds, real estate) and in B2B marketing where the shopping cycle is longer and where the decision set has a larger number of variables with complex relationships between them.

If behavioral targeting is going to become a standard, it has to have impact. Behavioral targeting must help us sell more things faster to those most likely to buy. If it doesn’t, it is just digital voyeurism.

For Technology-Enabled On-Demand Marketing -- Outsource

2005-11-23T13:55:00.000-05:00

The CMO Council met recently in Monterey, California and focused on technology-enabled on-demand marketing. But for most attendees this notion is either an aspiration or an apparition.

That’s because relatively few marketing organizations have embraced a data-driven sensibility, implemented a functional CRM system or allocated resources to automate and measure marketing activities. In fact, in a survey conducted for the Council, CMOs confess that the lack of customer insight, business knowledge and marketing analytics and measurement are their three greatest weaknesses contributing to the devaluation of the marketing function and the marketing organization within Fortune 1000 companies.

The sands are shifting under their feet but CMOs can’t seem to react fast enough to these seismic events to keep their jobs longer than an average of 23 months.

Why?

Too many CMOs only know what they’ve experienced themselves. Most came up through the risk adverse ranks of corporations or were imported from the big agency world where branding was the only thing that mattered, where print and broadcast were the given pillars in any effort ad where customers were an abstraction and sales were an annoyance. Most have only a superficial understanding of the nuts and bolts of the businesses they are in, don’t get metrics or measurement and bristle at the idea that numbers rather than big ideas or dramatic images can change the game.

Too many CMOs don’t have enough people or the right people to embrace technology and on-demand marketing. Marketers have been systematically eliminated by cost cutting measures and many of the survivors don’t have enough grounding in technology and metrics to make a difference. And even when they adopt technology they rudely discover it takes or diverts people to learn and use the technology before you can realize the benefits In many cases, useful technology and CRM systems don’t get used because there is no time for training, experimentation or gathering content and data necessary to feed the beast..

Too many CMOs still are limited by corporate silos. They don’t control the full range of marketing assets and capabilities, have limited access to financial data and find themselves fighting other units to align with IT, web sites, sales, operations, telemarketing, PR and other functional units that should be deployed as a holistic marketing ecosystem.

So what should CMOs do?

Assuming the objective is to get more for each marketing dollar spent and find ways to sell more things faster, the short answer is …Outsource.

The effective CMO recognizes the limitations on resources and the lingering doubts about marketing in the C suite and will embrace a strategy to assemble the necessary components rather than build them from scratch or aggregate them through empire building. He or she understands that performance – measured by some kind of ROI calculation – becomes the barometer of job security rather than how much everyone loves the new campaign.

The trick then becomes finding the right external partners with the right attitude, the right cost structure and the right tool set. And then, CMOs must find the right lieutenant to efficiently assemble, direct and align the outside players with marketing and sales plans, timetables and existing internal organizations to deliver measurable results.

We are seeing the emergence of these trusted lieutenants, senior Marketing Operations executives, tasked with this job. And they are talking the talk of marketing resource management (MRM) and scouring the landscape for partners, usually not ad agencies that can jump into the fray, deploy expertise and technology quickly without prompting battles with IT or requiring too many additional people to provide liaison.

These emerging marketing companies are the ones to watch for clever innovations, breakthrough technologies and traction in utilizing CRM and other data sources to move forward in automating repetitive marketing functions.

Psyching Out the Voters

2005-11-20T18:44:00.000-05:00

If demographics are based on the notion that “birds of a feather flock together” then psychographics works on the premise that on selected topics birds of multiple flocks care about the same thing in similar ways.

Mike Bloomberg used psychographic models and segmentation to get beyond “Soccer Moms” in his re-election campaign for Mayor of New York. Some observers are saying this changes the political calculus, though most of us think a mastery of psychographics is the secret genius Karl Rove has traded on for years.

Demographics are generally good predictors of the gross segments. Age, education and income pretty much dictate your taste in consumer goods, real estate and politics. When you overlay purchase data, be it anything from cars, clothes to magazine subscriptions the picture gets more nuanced, though the conclusions are clearly inferences not facts. For many marketing purposes this level of specfication is good enough.

Psychographics take this data and mix it with attitudinal data to produce a richer profile. It’s a simple formula. The more data you mix the more nuanced the profile you get. The more nuanced the profile, the higher the cost. Most marketers can’t or won’t justify the incremental cost of psychographic profiling because the value of a sale is too low or the need for such precision targeting isn’t as great. Generally only the highest value items with long or complex selling cycles are willing to invest in a psychographic approach.

For years big research firms have been creating segmented profiles which combine demographic data with purchase history or purchase intention to yield discrete groups which are likely to be targeted by marketers. That’s how Volvo and Bill Clinton discovered “Soccer Moms” as a distinct subset of the population worthy of specific messages and a bit of romancing in the first place.

Psychographics approach the compilation of a group by zeroing on a common need, attitude or behavior. For Bloomberg, “Fearful or Anxious New Yorkers” (FANS) are lower income people heavily dependent on the City and its social services both to provide income, income support and basic social services. The group cuts across zip codes, age and ethnicity lines.

His message to them reinforced the idea of security. The City will thrive. They will keep their jobs. The City will keep services open and flowing. The proof points were his record on fighting crime and terrorism and his track record on job creation and heath care.

Compare this appeal with that to “Cultural Liberals” those higher income New Yorkers concerned that the arts, music and culture scene be maintained both for their own enjoyment, the status of the City and as a lure for tourists. The pitch here was his background as a businessman and his strong fiscal management which allows the City to afford these things and “do more with less.”

Why did Bloomberg go to this extent when he was paired against a has-been politician from the Bronx? I’m guessing because he can. Will this create a new paradigm for political campaigns, as suggested by Jim Ruttenberg in the New York Times?

Don’t bet on it. Bloomberg spent 10 million dollars on what his campagned called "list development". That's a number that would scare even a national campaign.

But look for a clever contender, with a good database marketer advising her, to take existing psychographic data sets from commercial vendors and enhance them with voting records, data on political or charitable donations and real-time polling data to yield the same insight for targeting at a shade of the price.

Gauging Google's Gameplan

2005-11-16T08:44:00.000-05:00

Google is on the march. The announcement of Google Analytics extends the search firm’s easy, intuitive interface and its tracking mechanism to a broad range of Internet advertising and in no time it can be extended to other forms of inbound and outbound communication.

Not only does the move to give away these services threaten an array of web tracking vendors, it points to a Google strategy to concentrate, aggregate and dominate how messages are distributed, measured and valued in cyberspace and beyond. The new service will allow any marketer to track clicks on banner or text ads, clicks on rival search engines and clicks through to websites from e-mail campaigns.

In tracking this activity, it will be easy to track content sequences, frequency of visits and make some generalizations about the effectiveness of selected vehicles and selected messages. If the tools for accessing this data will be as easy-to-use as Google Adwords, the new service will potentially give marketers a faster insight into the efficiency and effectiveness of their messages and media choices. It could also cue publishers about the true use and value of their inventory which might lead to different pricing and bundling models.

Based on technology developed by Urchin, a firm Google acquired earlier this year, the free provision of analytics could spark an embrace of metric tools; a category still in its infancy both it terms of acceptance and use by marketers and technical sophistication.

This development provokes two thoughts …

I. Knowing is just the first baby step.

If less than 20% of million dollar companies with web sites have adopted web metrics, the Google move could instantly expand access to data about web surfing. And while FREE is a powerful incentive, you still have to have a sensibility for measurement and people who know something about metrics to meaningfully grasp the Google largess.

Yet this just starts the process. Once things get counted, someone has to apply some intelligence and experience to “read the tea leaves” and to understand what the patterns mean or to hypothesize and test assumptions that can be drawn from data. And assuming you have an interest and a capability to do so, then you need to figure out what to do about the data to achieve your own stated goals. The beauty of the Internet is the ability to track and count all kinds of things. The challenge is to figure out what all this data means and how to use it to get what you want.

Google Analytics will collect and display numbers, lots of ‘em. Google Analytics won’t do it for you, nor will it tell you what to do with the conclusions and inferences you draw from the data sets.

Google Analytics is a shot across the bow. It will make web tracking and metrics firms paranoid and possibly prompt a scramble for cheaper, more powerful tools to overcome the Google offering. But for the mass of marketers, its not much more than a clarion call to embrace tools that can make your money go farther and your messages work harder.

II. Google has a Grand Vision

They didn’t hire a zillion computer science geeks just fine their search engine. Google is thinking big and constructing a broad universe of offerings that they expect to change the game. Expect them to leverage the strengths of the net and the strengths of the technology they are building and acquiring like mad.

They are thinking big. They have a vision of mass, value and dominance just like Gates and Ballmer. Their moves are provoking worries about scale and changing business models. For little guys the Google vision could mean extinction. But the real impetus is the coming battle of giants that will pit Google against Microsoft and Yahoo.

For some this clash of titans ironically subverts the promise of the digital age where technology was supposed empower everyone to take a shot at the American dream. But like most maturing markets, roll-ups and dominant players look for opportunities to corner the market and use either innovation or distribution (think MS Explorer) to create captive or long term customer relationships.

And while many will lament the emergence of conglomerates in the digital space, we have always countenanced the price, speed and innovation benefits that big, well organized companies with a vision have brought into the market and into our lives in other contexts. Google will be no bigger or no badder a “big brother” than GM, GE or IBM.

The real challenge is to guess at Google’s end game and align your own plans to take advantage of their offerings or position your products and services in ways to leverage the disruptions that are coming.

Why We Still Hate Phone Companies

2005-11-10T13:53:00.000-05:00

Everyone still hates the phone company. My recent interaction with T-Mobile, validates a common shared ambivalence. Why are telcos so easy to hate? Their arrogance and complete disregard for customers is expressed by their customer service actions.

I signed up for T-Mobile “pay as you go” service after overcoming the shock that Wi-Fi wasn’t free at Starbucks. Beginning the moment after my credit card was processed, the T-Mobile Hotspot network at the Starbucks on East 77th and Lexington got funky. Every 90 seconds it dropped my connection and forced me to log-in again. This went on for the better part of a vente café au lait or until my murmured curses prompted the woman at the next table to acknowledge how spotty the network connection was and how frustrated it made her too.

I e-mailed T-Mobile customer care to complain and demanded a refund for the session. I immediately got an acknowledgement e-mail assigning me a case number (773354) promising real communication within 48 hours.

Two days later I got an e-mail from “Vasha” thanking me for contacting them and apologizing for the inconvenience. So far so good, though what kind of name is Vasha?

By the second sentence, they are laying out reasons why the cnnection might have been so unreliable. But each reason offered implies that the problem was my fault because I might be running a firewall or anti-virus program or because my wireless card driver might not be installed correctly. Rather than just admit that everything isn’t perfect on their network all the time, T-Mobile puts the perfoirmance burden on me.

The implication is that users screw up network performance which probably reflects the
company notion that customers are a necessary evil. What about all the possible reasons a network might not work properly that are network-oriented faults? Would Catherine Zeta-Jones be so quick to blame me for spotty performance? And how come there wasn’t a peep about my refund request?

In a 1-to-1 world, why did I get a one-size-fits-all response designed to get rid of me with faux politeness?

T Mobile, like other telcos, pretends to be infallible, mildly insults the customer who takes the time to interact with them and then wonders why we churn so quickly and why its so hard to create brand advocates.

Whatever happened to the idea that the customer is always right?

Will The Cookies Crumble?

2005-10-30T14:34:00.000-05:00

The latest paranoia among online marketers is anxiety about the demise of cookies, those web objects that contain no code but enable all web recognition and tracking.

Without cookies there is no tracking, no stored passwords, no purchase history, no instant recognition and no way to make or attribute sales. Absent cookies the Internet is as blind as network television or national magazines.

Cookies come in two flavors. First-party cookies directly link your computer with a favored site. These cookies allow you to quickly log-into your bank account and make it easy for Amazon and others to welcome you by name and serve you content that you have already specified or expressed an interest in. When first-party cookies are present you can be identified 99.4% of the time according to Coremetrics.

Third party cookies come from ad servers and are imbedded in everything from ads to porn to the viruses that capture and destroy your hard drive. They mostly enable somebody out there to anonymously track your behavior and, in some cases, record your every click.

Cookies are under attack from several directions. Microsoft Internet Explorer 6, the current version in universal use, responding to consumers’ privacy needs and its own security concerns, already blocks some cookies. There are rumors that in “Longhorn”, the next generation of MS Explorer, all cookies will be blocked, though to do so Gates & Company would screw themselves by disconnecting millions of Hotmail and MSN users.

But privacy concerns are real and growing. It turns out that cookies and spyware are pretty much two sides of the same technical coin. Therefore many of the new anti-spyware and anti-virus software programs sweep away cookies along with pop-ups and porn. And average consumers, between 35 and 56 percent of those online depending on whose prognostication you believe, manually dump cookies once a month.

But before you become Chicken Little over this, keep in mind that cookies enable the unique accountability feature that distinguishes the Internet from other media and directly feeds the coffers of MSN, Yahoo, Google and everyone else cashing in on ecommerce. Cookies are the only way to identify unique visitors; the metric that supports all ad pricing and facilitates counting and ranking site traffic. So there are plenty of tech-savvy players with a direct and urgent incentive to solve the cookie problem.

The smart money is betting that first party cookies will remain and 3rd party cookies will be toast in 18 months or less. The hitch is the need to extract the historical data and purchase histories from third party cookies, before they disappear, so that your favorite sites and merchants can maintain continuity and continue to recognize you for who you are; a best customer.

WebTrends has a system that they’ve patented. I suspect others are close on their heels. So if you are looking for something to worry about, put this one to bed. Assume that some form of cookies will continue to exist and fuel Web metrics. Figure they will be some variation of first party cookies and that you’ll have to add money to the budget to make the transition before 2008.

E-Mail Doesn't Have to be Antiseptic

2005-10-22T17:28:00.000-04:00

JD Powers reports 2/3rds of car buyers research purchases online. Five rounds of e-mail tag illustrate the self-imposed limitations on online sales tactics.

Feeling flush, I decided to shop for a Saab or a BMW online. In 1997, when I bought a Ford Explorer, I called 4 local dealerships, got descriptions of what they had on the lot, made a choice and concluded the purchase over the phone using my American Express card. So I figured that I could click, exchange a few e-mails and make a purchase online.

I was wrong.

I clicked on an Autobytel.com ad and filled out a form. Within minutes I got acknowledgement e-mails from two local BMW dealerships. I’m still waiting for a response from a Saab dealer so either Autobytel, an information and lead generation service for dealers, is void in my area or the local Saab dealers aren’t fleet of foot.

Then I was introduced by e-mail to Maggie Keating of DeFeo BMW and Renee Kim of Prestige Motors. Both sent me e-mails introducing themselves as Internet sales representatives and pledging undying efforts to contact me and “make your experience completely satisfying.”

When I didn’t respond and ducked their phone calls I got another e-mail. This version was slightly more intense. It assured me that each of them was dedicated to helping me and again pledged to satisfy me.

Just in case I didn’t believe them. I got more e-mails shortly thereafter, one ostensibly from each of their direct managers and one from Autobytel, containing surveys asking me to rate my satisfaction with the speed of response and engagement process thus far.

The surprising thing was after 3 rounds of contact … no one talked cars to me. Nobody sent me a pitch or a picture. Nobody loving described the perfect BMW 3 series they had waiting on the lot with my name on it. Nobody told me what a stud I was for considering BMW. Nobody proactively tried to sell me anything.

It was all antiseptic e-mail. No emotion. No color. No pitch. The emphasis was on reassuring me that the online channel was real and that these cyber saleswomen meant business.

Instead of selling me they asked me questions. Some duplicated the form I filled out. Most asked me questions about what I wanted – what packages? What color? What model? Not all the questions seemed to be aimed at qualifying me.

I had no idea what was possible or available. When I said I wanted to buy within 30 days and asked them what was on the lot ready to go and asked them to compare monthly leasing rates with purchase rates, both Maggie and Renee suggested I cruise by bwmusa.com and then answer the questions. Still no pitch, no come-on and no car talk.

Isn’t it funny how different the online experience is from the showroom? On the lot, a salesperson would romance the product, put me behind the wheel, talk up the features and benefits and try everything possible to get me visualizing myself behind the wheel of a fully loaded BMW 325. In real life, if I showed signs of desire, like asking about rates and specifying a 30 day decision-delivery cycle, they’d immediately start talking details, deals and delivery dates.

By e-mail I got the third degree. But no romance, no customer service and no uptake on the signals I was sending. When I asked what they had available, neither sales rep responded by saying, “we have a hot black 325i with leather interior, a killer stereo and satellite radio that we can deliver to your door tomorrow.”

I was looking for them to do the heavy lifting for me and to sell me a car. They were looking to be politically correct and to meet some management-imposed metrics designed to assess the value of the fee the dealers pay Autobytel. The end result was that neither of us got what we wanted.

The moral of this tale --- online should contain the same combination of emotional and logical elements of a real life sales experience. The number of non-serious tire kickers online is probably the same, in percentage terms, as on car lots. So there is probably nothing to lose by focusing e-mail exchanges on selling.

Why bother to engage customers with e-mail that is tepid and process oriented rather than product-centric and sales focused? Think about the psychology of it. If I took the trouble to click, I’m interested in a car; your car. Talk cars to me. Confirm my interest, validate my brand selection, draw me in with eye-candy, the brand values, unique features and benefits and/or the best deals you can make. Nobody wins when we just play e-mail tag.

Piercing the Veil of Anonymity: Step 1

2005-10-12T13:56:00.000-04:00

Most people who see and respond to advertising are anonymous. Each day millions of unknown people click on key words, banners and emails, tune into to broadcast media and read print vehicles. It’s always been this way in a one-size-fits-all brand advertising world.

Getting past anonymity is the greatest challenge in the evolving, measurable, interactive one-to-one world we live and market in. Piercing the veil of anonymity is critical to deliver personal, customized super-relevant interactions which lead to sales and ultimately help build valuable on-going customer relationships.

Privacy and perceived value guard the unknowns. Consumers and business people are anxious about revealing themselves because they don’t trust us. They don’t believe we can or will keep what they tell us secure and to ourselves. And they don’t believe that we can restrain ourselves from pestering them with too many questions or assaulting them with too frequent or too irrelevant communications.

Yet thousands of campaigns have proven that people will give up information incrementally in return for information or services they perceive to be of value. In fact, in the presence of high perceived value privacy concerns melt away for the great majority who are happy and eager to trade information for a give-away they desire.

Therefore the challenge for marketers is to create offers perceived to be of such value that targeted audiences will uncloak themselves in return. So far “best practices” in this regard are:

I. Confirm Response and Validate Their Action

Create unique landing pages that look and feel like each campaign. Never just drop off a responder at your Home page. Most people still need to be reassured that they ended up where they want to be. The Internet is still somewhat magical to an awful lot of us.

Be sure the landing page delivers on the promise in the ad. If you tout a product or service, picture it, describe it, offer specs and offer answers to the most logical or most frequently asked questions right then and there.

If you can offer prospects a few immediate content choices that naturally follow from the ad premise, you are much more likely to delight them and engage them to continue a conversation with you. Remember that each step in the conversation pre-sells the next and that the experience prospects have at each step must close for the opportunity to continue the interaction.

II. Track Behavior and Dynamically Serve Up Content.

Recognizing and responding to behavior starts the process. Create a user experience that is easy, intuitive and relevant to anonymous prospects. First, can they find what they are after quickly and easily? Second can you watch they are doing in real time and give them more of what they want and what they express an interest in?

If you can’t do it in real time, study your weblogs, identify what significant groups of prospects have looked at and interacted with in the past, anticipate several likely pathways through your content and lay them out in an easy to find and appetizing way.

Third, based on what they seek and what they use, predict their next likely move and proactively provide them with it.

III. Reveal Yourself and Make an Offer.

After prospects have moved through predictable content paths it’s time to try to meet them. The goal is to identify named individuals with explicitly expressed preferences from the anonymous visitors. The key ingredient is patience.

Remember fundamental psychology. Nobody likes surprises. Love-at-first-site exists only in fairy tales. No sane individual tells you their whole life story when you first meet them. Everyone hates salespeople. People buy people first, then goods and services trade hands; your personality will come through by how and when you reveal yourself.

Keep in mind that it’s all about THEM not you. Their wants, needs, likes, dislikes and anxieties drive the process. Not yours. Get an e-mail address first. This is the key to an on-going conversation. Don’t try to get 25 data points out of anyone on first contact.

The three best ways to reveal yourself are:

Ask your anonymous prospect if they are getting what they need? This interest in their satisfaction can be done in a pop-up or pop-under. Simultaneous with the question should be an offer to provide more of the same, the next logical thing or something different in return for an e-mail address.

Offer the anonymous prospect something free in return for their e-mail address. This can be a free sample, a download of data, a report, music, industry intelligence, a digital tool or calculator or it can be a gizmo, a reprint or a tchachkie; in which case you might need to solicit a postal address to fulfill the offer..

Offer to enroll the anonymous prospect in a contest to win something of value in return for their e-mail address. The prize can be your product or service, a discount on your product or service, access or value from a partner or access to an event.

Once you have the e-mail address, confirm it and ask permission to continue the semi-anonymous conversation. In seeking permission comply with privacy requirements and ask your partially known prospect to tell you how, when and about what they’d prefer to continue talking. Most campaign research indicates that responders who express preferences for channel, media and frequency convert to buyers 3-5 times faster than those who aren’t asked or don’t specify what they want.

Only by piercing the veil of anonymity can you begin the process of converting a prospect into a customer, a repeat buyer or a brand loyalist and advocate.

CMO Survival Guide

2005-10-07T10:41:00.000-04:00

Headhunter Spencer Stuart (www.spencerstuart.com) clocked the tenure of Chief Marketing Officers (CMOs) at b2c companies as 23.7 months, up a full month since the last time they conducted the survey. It seems that CMOs like agencies are hired primarily so they can be blamed and fired after less than 2 years on the job by other C level players, whose average tenure is considerably longer.

Disposable CMOs suggest that marketers have dramatically less perceived value in corporate C suites than CFO bean counters or CIO chief geeks, both of whom hold their jobs, on average, a third longer. CMOs last only half as long as head honcho CEOs, who generally take the heat for overall performance.

Many of the CMOs I’ve worked with have been obsessed with advertising, too focused on their own organizations and unwilling or unable to grasp essential business realities to add value to the operation. Some have spent their tenure kissing the CEOs ass. Others have built themselves an empire which was often at odds with other C level players and frequently seen as irrelevant to the business.

CMOs are easily impressed with their own grandeur and frequently concerned with grabbing as many perks as they can get. They don’t understand that in most companies marketing is seen as a necessary expense and annoyance rather than the Great White Hope.

So for a bracing splash of reality, consider these CMO survival tips:

1. Don’t Automatically Fire the Agency.

Most CMOs fire the agency during the first 60 days on the job. They think they need to put their personal stamp on the brand, revamp the advertising and start fixing all the things that their predecessor screwed up.

This is usually a deadly trap. The agency can actually teach you about the business. The agency always has internal allies and partisans who then become your immediate enemies and detractors. And it’s rarely about the ads. Switching one parity agency for another just kicks over the table and builds in transition and ramp-up time, which for some CMOs means breathing room before they have to deliver.

In most cases the brand advertising campaign costs the most and yields the least tangible benefit to the business. Your big, bold, new idea not only has to pass muster with risk averse and troglodyte superiors, it’s rarely going to change things. And more often than not it becomes a lightening rod for internal or external criticism of your performance.

2. Learn How the Business Works.

CMOs are expected to be something more than traveling ad makers. Few CEOs and boards are happy for a senior player to travel his or her one big idea from company to company. And in spite of your experience, all firms are not essentially a like at the operational level. Get your head out of the clouds or out of your ass and focus carefully on how the business operates and how the parts come together or don’t.

The typical company is composed of a dysfunctional collection of duchies that tolerate each other and every so often interact successfully. Many CMOs can add value and gain allies by resolving internal battles, directly addressing outstanding pains or getting marketing to work better, sooner or more easily with some other part of the business.

Suck up your pride and embrace units like call centers, database teams, event units and field marketing; groups who handle lots of messy details and who are often either undervalued or frequently complained about. Integrate them into the marketing organization and get them supporting, rather than sabotaging, your plan of attack.

3. Make Nice to Sales and IT.

These are generally the two biggest competitors for CEO attention and corporate resources. In most companies the struggle between these organizations is on-going and titanic. Too many CMOs spent their time building a marketing empire to parallel or confront these other, larger and more potent empires. But when the inevitable clash comes, Marketing almost always loses.

Marketing is always the weak sister because unlike Sales, it brings in zero revenue. And marketing, unlike IT, is not perceived as mission critical nor can it quantify, justify or rationalize huge investments the way IT can. Therefore strategic concessions and a willingness to share resources is a much more effective tactic than trying to take on players who are usually more entrenched and usually perceived as heavier weights.

Smart CMOs align themselves with Sales and defer to CIOs. They avoid competing for technology resources by relying on agencies and outside vendors and they try to pick their battles over the choice and installation of CRM software. And they work hard to be sure that the campaigns running directly attack the same audiences that Sales is attacking and they get access to the pipeline and sales planning..

The smartest CMOs buddy up with the Sales leadership, throw them an occasional bone or boondoggle and get cozy with the CIO, who ultimately can save or screw you.

4. Measure Everything.

Because no one believes Marketing adds to revenues, a savvy CMO must prove that he or she carefully and productively spends the marketing budget and that allocations made yield strong returns in terms of awareness, leads, future sales and customer or partner satisfaction.

Soft measures like brand value, brand rankings and purchase intent don’t get attention or credibility among CFO and CEO types who are constantly looking to slice the marketing budget and apply the savings directly to the bottom line to meet Wall Street’s forecasts and expectations. Face it -- at the CMO level you are playing a different game than you are used to. All the big ideas and creativity in the world doesn’t matter.

Most C level players still think the marketing budget is too big and mostly wasted. The CMO has to prove them wrong and have the stats to do so at your finger tips. If you don’t know and can cite your cost-per-lead, cost-per-acquisition, cost-per-service call and if you don’t have a handle on the sales pipeline you are not in the game.

It helps if you can do more with less and document the efficiencies you’ve created. Often measures of internal efficiencies, de facto evidence of C level business management skills, can deflect questions about the ultimate impact of marketing spend on revenues. It’s a numbers not a pictures game at the CMO level. If you don’t have a dedicated and trusted numbers guy handcuffed to your wrist, you will not beat the 23 month mark.

Savvy Search Strategies

2005-09-27T19:38:00.000-04:00

Buried in MarketingSherpa’s annual search survey (http://www.marketingsherpa.com/) is some very useful advice on how to use search engine optimization and pay-per-click tactics based on the input from 3271 active marketers. Here is my reading of the tea leaves.

1. You gotta do both to win. Invest in search engine optimization (CEO) and pay-per-click (PPC) to drive traffic to your site. Marketers are much happier with PPC now that they are getting the hang of it. SEO continues to be a cat-and-mouse game between search engine programmers and marketers.

2. The average investment is between 40 and 50 percent of budgets, for both b2c and b2b players. Most marketers expect this investment in to increase over the next 12 months.

The promise of cost effectively delivering interested prospects to a site is a very easy sell internally and this promise added to the general media hype about search makes for a relatively easy budgeting case even in tight-fisted companies.

It’s a fair bet that funds for SEO and PCC are coming from funds formerly slated to outbound acquisition e-mail; a tactic widely seen as on the wane in terms of value and ROI. It is no surprise that spending on search was up 177 percent over the past 12 months and only 21% of those surveyed said they aren’t doing search marketing.

3. The more search is used; the costs grow and conversions plummet. It is almost an economic law. As a medium matures the costs go up as competitors swarm in and prospects get divided among more and more competing brands. In the end, search, like TV, will yield less at higher price points. This process has clearly begun.

4. To find the right niche and to channel the best prospects to their sights the average keyword volume was up 90 percent to 17,314 keywords in 2005 over an average of 9100 in 2004. This number of keywords and the variations thereof mandate dedicated resources and probably some moderately sophisticated software to manage these campaigns where marketers scatter PPC ads over many more categories and subcategories in search of competitive advantage.

5. The best players are using veteran SEO agencies with sophisticated tools to manage and measure these buys. This isn’t something that you can have somebody in the marketing department pick up and handle in their spare time.

6. The Holy Grail is keywords that not only create clicks but that bring site visitors that engage with your site. This process is called “conversion.” This usage of the word is unique to the search community. It should be distinguished from the usual direct marketing meaning of this term which implies somebody took a desired action, identified themselves, signed up for something or actually bought something.

This is a particular dynamic of the search business where the interests of the media
(e.g. Google and Yahoo) and the interests of their clients diverge somewhat. The search engines get paid on every click. They care, though not all that much, who clicks or what the clickers end up doing. As fewer people who click engage, give up their e-mail addresses or buy stuff, search marketers redefine success.

7. Initially search delivered eager-to-buy prospects; people who self identified their interests and the urgency of their need by clicking on your key word. Now the promise of search marketing is beginning to shift. Rather than expect an immediate conversion from clicker to interested prospect, instead now measure some combination of engagement and brand awareness. As search marketing grows and becomes part of the media landscape it performs just like everything else. Response rates drop.

8. Finding the Holy Grail is about creative. You may be wondering how creative you can be with a 3 word headline, ten words of copy and a unique URL. But that’s the game. In fact the space restrictions are even more onerous since most ads include the words CLICK NOW or CLICK HERE.

9. Copy testing has become a separate thing all together. And not surprisingly agencies, especially agencies new to search marketing, are much more eager about creative testing than company marketers are; probably because they want to burn up more hours learning the business at the client’s expense.

10. In finding a platform for testing, Google and Yahoo/Overture are the whole act. Everybody uses them. In fact between 50-80% of marketers don’t even mess with the other 12 second tier search engines. Though given how cheap they are, many agencies are inclined to work them into the mix to bring overall cost-per costs down.

11. This near total dominance by two platforms is driving Microsoft to covet the pot of gold they are NOT earning and to devise technology to differentiate their offering and woo the search marketing crowd. Microsoft’s nascent adCenter is being tested in Singapore and France. It promises to offer more sophisticated search targeting by marrying key words with 400 million stored profiles across Microsoft’s portfolio of sites and services. They are threatening to roll it out in the USA in October or November 2005. They have the cash, the clout and the company to sell this idea and gain huge buzz and awareness. But the big money won’t change hands until they prove that the targeting , the interface and the results are better.

12. And if you aren’t baffled by search marketing or you don’t fear Microsoft, consider the research done by Marketing Experiments. They put 9 press releases on the Web using BusinessWire (http://www.businesswire.com/) and ran simultaneous PPC campaigns on Google. Over the same period of time, they attracted more clicks from the PR effort at dramatically lower cost-per-clicks than for clicks coming from relevant targeted key words.

So maybe search is our most effective current traffic building or perhaps it’s all a tempest in a teacup easily trumped by clicks from content.

The Twin Challenges of E-Mail Deliverability

2005-09-23T11:16:00.000-04:00

Half of all e-mail marketers say deliverability is their biggest problem. Yet many of these marketers confuse deliverability with impact or effectiveness. E-mail has become a two-part game – 1) getting it to the desired recipient by eliminating bounce backs and 2) getting the desired recipient to see and potentially read it or act on the message.

Tactics to reduce bounce backs are evolving. Tactics to insure true delivberability and impact, especially for for outbound acquisition are still elusive.

Bigfoot Interactive reports that overall deliverability in Q2 2005 was 94.4%, an astoundingly high number considering the increased use of spam filters, a legion of suppression tactics employed by ISPs, blacklisting and a general paranoia about viruses and spam. But remember, even if true, this means that 94.4 percent didn’t bounce.

It does NOT mean that 9 out of 10 addressees opened, read or acted upon the promotional or editorial e-mail sent to them. A huge percentage of the e-mails that didn’t bounce back ended up in “junk” or “bulk” e-mail boxes and were deleted without being seen. Many more made it to an "in" box where they were not recognized and deleted manually without being seen.

But remember, even if true, this means that 94.4 percent didn’t bounce. It does NOT mean that 9 out of 10 addressees opened, read or acted upon the promotional or editorial e-mail sent to them. A huge percentage of the e-mails that didn’t bounce back ended up in “junk” or “bulk” e-mail boxes and were deleted without being seen.

Jupiter Research is saying the average e-mailer uses 2-3 simultaneous tactics to prevent bounce backs. Michelle Eichner of Pivotal Veracity says that tactics should include

Scan your content and address records to eliminate elements that would trigger a bounce back

Be sure your HTML aligns with the WWW Consortium standards

Manual check how your e-mails will come across on Yahoo, AOL, MSN, Lotus Notes, Outlook and Eudora

Check to see that you are not on the black list

Monitor abuse boards to be sure they are not talking about you.

Ask your subscribers to put you on their “safe” list.

The tactics for insuring that you get into an active “in” box are almost non-existent if you are trying to reach people who have not subscribed to your e-mail offering or who have not opted-in to receive e-mail from you.

Positioning PR for Maximum Results

2005-09-12T15:00:00.000-04:00

I am amazed at how much business people expect from public relations. But I suspect that the overblown expectations which usually follow from the injunction “let’s get some PR on this” have more to do with tight budgets than realistic marketing strategy.

PR is an incredibly competitive sport. Each day thousands of story ideas compete for space and time in hundreds of trusted media outlets. The best PR people know how to frame the story, how to craft the pitch and exactly who to talk to. And even the best practitioners have to compete with wars, hurricanes, elections, coups, Wall Street, Congress, court decisions and other stories considered competitive hard news topics by the dominant media which can easily shift the news agenda and overturn all previous plans or promises.

PR, as opposed to advertising, carries the implied third party endorsement of the medium in which it appears. Most people, even skeptical, media savvy people, believe that “If the Times prints it, it must be true.” And yet this added credibility is never as strong as a paid call to action.

Another aspect is the trade-off between endorsement and editorial control. In a typical PR placement, an editor or a producer makes a decision on what to say, how to say it, how much or who to include and what to exclude. In fact, as a point of pride and to illustrate the distinction between editorial and advertising, it is rare for newspapers or TV stations to print or air prices or contact information.

As a result, people reading or viewing a story about an event, a concert, a performer or a product are much less likely to pick up the phone, type in a URL or initiate a Google search than those who see an ad asking them explicitly to take these actions.

Marketers fantasizing that a PR campaign by itself will sell out a theater, empty a warehouse or drive traffic to 800 numbers or websites are kidding themselves. PR, like brand advertising, builds awareness, creates a buzz and begins the demand generation process. But rarely will PR alone play the role of direct response advertising.

If you don’t target your most likely audience and communicate with them directly by making an offer, you are wasting your PR effort. PR combined with well placed; controlled messages with clear calls to action are a “best practices” formula for success. Anything less is wishful thinking.

DRTV Gets Its Due

2005-09-09T22:25:00.000-04:00

Direct Response TV advertising (DRTV) seems to be the fastest growing segment in TV Land. Sales are up 25 percent during the first half of 2005 to $1.2 billion, according to TNS Media Intelligence, a growth rate double that of cable TV. Sellers are reporting 100 percent renewal rates from DRTV advertisers like J&J, Pfizer, Orbitz and L’Oreal. Packaged goods and financial services advertisers who long disdained DRTV are now embracing it.

My...how things have changed.

Not too long ago DRTV was the late night and weekend province of the Ab Roller, Hooked on Phonics and Ron Popeil. It was, if you believed the white shoe ad guys, a sleazy neighborhood frequented by brands on the deathwatch, jobbers with leftover inventory and small time entrepreneurs running boiler room operations in search of quick and dirty wins.

Fast forward to a time of tight budgets, fragmented viewing, integrated marketing and creative executions that can simultaneously promote the brand and carry a call to action. Presto! The ugly duckling becomes a swan.

DRTV can be branded and responsive. DRTV is carefully tracked to yield a clear ROI. And DRTV at 40 percent of the cost of upfront or scatter inventory is still bought creatively to finesse network issues and zero-in on target audiences. DRTV reinforces brand awareness. DRTV drives phone calls. DRTV drives web traffic. DRTV provokes search engine queries.

DRTV has always done these things. This is nothing new to those of us who have toiled “below the line.” We can all enjoy a brief “I-told-you-so” moment, bask in the recognition for a previous undervalued media channel and savor a back-handed compliment for all those savvy media people who have mastered the nuances of DRTV.

Seifert's Ethics Sideshow

2005-09-08T22:38:00.000-04:00

As part of her sentence for defrauding the government former Ogilvy and TBWA executive Shona Seifert was required, by US District Court judge Richard Berman, to write a Code of Ethics for the advertising industry. The judge evidently thought we, as an industry, were down a quart.

The 18 page document written by Ms. Seifert and filed with the court on August 31st is an odd duck that has spawned some interesting commentary and controversy. Anyone looking for a set of rules or anything approaching a handbook will be disappointed.

Instead Ms. Seifert addresses her “Proposed Code of Ethics for the Advertising Industry” to “frontliners everywhere.” Her first words, “None of us ever plans to be thrown under a bus” make it clear that in addition to a few gratuitous rules, our girl Shona is out to prove that she was the sacrificial lamb; that she took one for the team.

If you doubt my interpretation, consider her fifth line, “If you are a frontliner you are more likely to find yourself in the line of fire. And it may be better for others that you take a bullet.” To which she adds in hindsight, “Don’t compromise your own values to achieve someone else’s goals.” Nah. Nobody in the ad game ever does that.

This is a funny sentence and a funny response to it. The language is elliptical, filled with clichés and obvious imperatives. For example she writes “Don’t take a government contract if your agency is not well versed in the regulations.” This and many other Business 101 statements make me cringe. I wonder if her PowerPoint decks and her client memos were as ponderous and as vacuous. On the basis of the writing alone, I’d sentence her to prison.

Ogilvy and Shona did what most agencies do. They have the most junior players keep records using rudimentary systems. Then they ask senior people to continually project workflow, estimate revenues and cover the number of hours worked at target margins. Shona and her team held record keeping as a low priority and when necessary to protect their jobs and their bonuses manipulated the data to make their numbers.

Unfortunately they messed around with the government, who cares more about accounting than creative. Shona makes my point by discussing the importance of big ideas and brilliant work versus bookkeeping. She advises her peers that “boring work has never resulted in a prison sentence. Poor timekeeping practices have.” Consider us warned.

I hope the judge is lenient with her. This is a mealy-mouthed apologia that dances around the issues, has all the weight of a Hallmark card and attempts to position Ms. Seifert as less than the felon she is.

2005-09-07T14:10:00.000-04:00

E-mail Danny Flamberg dflamberg@gmail.com

2005-09-07T14:08:00.000-04:00

Danny Flamberg

Proving the Obvious: Consistency Counts

2005-09-07T11:49:00.000-04:00

It makes me crazy to read study after study proving the obvious. Yet in a risk averse marketing world nobody can make a decision based on common sense or practical knowledge, everyone needs a third party expert or reference. This bureaucratic, CYA-driven thinking yields Katrina-like performance.

For example consider recent research by Basement, Inc. (for SugarShots liquid cane sugar) designed to test the proposition that a cohesive graphic theme carried across channels will have a positive impact on the viewer.

Duh!

They constructed a test whereby one group of random prospects saw an ad and were directed to a website that looked the same as the ad. The second group saw the ad and was directed to a site that looked different from the ad.

Wanna guess what happened?

Those who saw the consistent graphics were much more likely to take the survey and were 17 percent more likely to have an interest in purchasing the product.

Is there anyone working in advertising, marketing or any form of communications that doubts the value of consistent, one-voice messaging? Can anyone seriously argue that using different graphic treatments for related channels enhances the brand experience or enhances the way consumers process and respond to messages?

Consistent presentation sets expectations, creates a comfort and establishes a recognition zone that engages prospects and puts viewers in a frame of mind most likely to begin the sales process. Shrinks call this schema-driven processing; basically customers recognize familiar patterns which reduces anxiety and requires less brain power than seeing something new or different.

Savvy marketers not only use graphic continuity but they understand and use different channels as related parts of a single narrative. The ad sets the theme and provokes inquiry. The landing page extends the theme and gives the prospect opportunities to interact and customize the conversation. The follow-up e-mail or phone call or direct mail package wraps the theme around customized content and presents specific offers or calls to action. Consistent visual cues and language make the experience as complete and immersive as possible.

So please consider this obvious thing now proven definitively.
It is available for quotation and use as an all-purpose excuse or rationalization.

Google Hedges Pay-Per-Click Rankings

2005-09-06T16:33:00.000-04:00

Some things just can’t be bought.

For instance, if you pay the highest per-click fee on Yahoo’s search engine, you can be sure that your ad appears in the top position under Yahoo’s sponsored listings for that particular word or phrase. The guy paying the most gets the top spot. It’s a pure pay-for-position deal.

Google does it differently. At Google cash is only part of the equation that determines which paid ads get top placement. They use a relevancy algorithm that factors the cost-per-click paid with the total number of clicks an ad gets to determine the ranking of paid results for any given word or phrase. So even if you pay top dollar, if they don’t click you don’t get the top position.

The difference in how these engine’s allocate the best paid real estate on search result pages forces marketers to make some savvy guesses about the likely reaction and click rate for key word ads. If your copy resonates and you are top bidder, Google will do your bidding. If not or if your not sure, better to buy your way to greatness on Yahoo or on MSN, as served by Yahoo’s search engine, even if they are delivering fewer searches.

Only a market leader with 79 million monthly online searchers and a significant lead over the competition could impose its will this way.

Why Econometrics Won't Save the 30-Second Spot

2005-09-06T15:39:00.000-04:00

If you follow the predictions of WPP’s Sir Martin Sorrell, and many who follow advertising do, you might believe that econometrics will find the data to save the 30 second spot from oblivion.

But in this case, Sir Martin is jaw-boning a likely acquisition and looking to spin things in his favor.

The reality is that econometrics has been around a long time and has produced some very valuable models. Why hasn’t it already been applied to TV advertising?

There are several good reasons:

You need lots of data to build reliable models. All we have for TV is the buying data. Data about timing, impact, attitudes, behaviors, purchases, wholesale and retail prices, promotions, coupons, store locations and data to support correlations between spots running and products moving off the shelves is virtually non-existent.
-Econometric modeling costs a lot and requires sophisticated researchers. So far the attacks on TV haven’t been sufficiently threatening to warrant the level of cash outlay required.
There are too many related yet uncharted variables. Even the best models would be sophisticated guesses that would have to be validated over time by even more data (that we don’t yet have). That’s an awful long way at an awful high cost to be so easily dismissed.

Sooner or later advertisers will want to understand how and why TV ads impact sales. They will want measurements that assist them in making budget allocation decisions based on media effectiveness in generating immediate and short-term demand.

Just don’t bet on econometrics to provide the answers anytime soon.

Internal Politics Limit Global Websites

2005-08-17T18:00:00.000-04:00

Every FT 2000 corporation has a website. But very few of these sites make major contributions to the business or to the communications objectives of the firm.

Why not?

The three biggest reasons have to do with governance, strategy and process; all topics that are political hot potatoes.

1. Everybody or Nobody is in Charge. In typical matrixed organization IT owns the plumbing and Marketing owns the content of the corporate website. Often they spend their time fighting with each other. Rarely is there a clear leader. So rather than advance the cause, they squabble over resources and over who gets to make each internal decision. IT fights using technology to enable or block each move. Marketing uses budgets to the same ends.

This is unresolved civil war is often compounded by the fact that few customers do business globally. The real action takes place on local or country websites. Here too governance is often not clear even when a set of global design, interface and technical standards exist. Global players lay down the rules but local players, asserting their rights allegedly based on local P&Ls, skirt them. The net result is an on-going battle for control that nets out very little progress in terms of impacting the business.

2. No Clear Objectives. Websites are beautiful things. They can hold and display mountains of material. And they can address and engage multiple target audiences simultaneously. But too many global firms have a website for its own sake and cannot articulate what the site is supposed to do or where it fits into a selling, a communications or a messaging strategy. As a result it becomes a White Elephant thrashing around consuming time, money and resources in search of a mission.

The best sights prioritize audiences in their interface design and create well-marked pathways for each target audience to see and get what they need quickly. They regulate how much gets published on the site, use content management tools and carefully assess how many bells and whistles are needed. The also-rans present a Chinese menu of stuff, turn the website into a great repository of blab, get distracted by the technical parlor trick of the week and hope that whoever lands on the site will either find their way or forgive them.

3. No Process Integration. Websites can play distinct and effective roles in selling things, generating leads, raising awareness, addressing legislative and regulatory issues, providing service to customers, cataloging or demonstrating products, collecting information or opinions and in interacting with people. Many sites have built-in the functionality to accomplish these tasks.

Far fewer have placed the website into a sequence of events or a contact strategy designed to leverage the strengths of the digital medium and link them to pre or post human-to-human interactions (in-person or by phone) or connect them to the natural steps in a deal flow. This short changes both the website and the corporation because it minimizes the chance to leverage combined assets to achieve company goals.

Genuinely leveraging the web means thinking carefully about how each task gets done and breaking each task into its natural steps and then assigning part of the effort to the website. It requires a plan to get people to and through the web and/or follow-up tactics to use the digital interaction to advance a sale, solve a problem, deliver information or build a relationship. It’s about placing the unique capabilities of a web site into the context of discrete business processes, then measuring the web’s ability to expedite and accelerate the process of accomplishing key tasks.

It's Always About the People

2005-08-04T16:42:00.000-04:00

People subvert every brilliant system.

Why?

Because we are creatures of habit. We are set in our ways and resistant to change.

Another reason is that the people who think up great systems and stunning software innovations rarely think about them from a ground-level perspective or design them to suit the mechanics of daily work life.

Exclusive attention to top-down perspective breads bottom-up rebellion. It’s a formula as old as mankind and one that is frequently ignored. If you doubt me, ask Louis XIV, Tsar Nicholas II or George the Third.

That in a nutshell is the story of CRM and very well could become the story of business process innovation. The guy who thinks up and builds the system never talks to the guy who really uses the system. Too often this oversight manifests itself in an interface that is hard to use and hardly intuitive.

Forrester reported August 3 that the market is “rife” with dissatisfied customers who will spend $3.2 billion on CRM licenses over the next year even though only 29% are satisfied with the integration of applications and only 1 in 3 are happy with the ease of working with their chosen software vendor.

As a result the user benefits accrue on a macro level, where C level executives calculate the reduced time, costs and complexity, instead of at the user level where working stiffs buy-into and implement systems that will make them happier, more productive and reduce the repetitive drudge work. Yet with a little effort, insight and attention everyone can be made happy.

Consultants call the process of imposing solutions that do not account for real people as end users “change management.” But in real life these complex, jargon-filled methodologies and so-called techniques are nothing more than ways to coerce reluctant workers to use a system that was bought for them. Like Mary Poppins, the mercenary consultants fashion a “spoonful of sugar” to make the medicine go down.

But it doesn’t have to be so. Change management should begin with initial concepting and design. Software thinkers need to get closer to where the rubber meets the road. in terms of understanding specifically who will be using the system and how they see themselves.

Consider the CRM example. Top management wants visibility into marketing. They want to know what they are getting for dollars invested and they want to see if costs can be tightened and reduced. It’s a noble objective.

Marketers see themselves as creative idea people. They are the guys who make magic. They come up with the big ideas that move markets. The very notion of CRM forces them to confront long held beliefs and self-images. In the mind of the average corporate marketer, bean counters embrace CRM not marketers.

Unfortunately the makers of CRM applications have fallen short in addressing this concern and in demonstrating to the likely user base that the systematic collection of campaign data can provoke more big ideas and potentially separate the big ideas from the also-ran ideas. Add to the attitudinal issues the difficulty and drudgery of the data entry process or the arduous process for creating reports and it’s not a surprise that marketers don’t see CRM as a gift or a tool but rather see it as an added burden.

Porn & Productivity

2005-07-24T23:02:00.000-04:00

Are we just talking a good game?

New research on workplace behaviors and online porn suggest that things aren’t what they seem to be. Americans’ highly touted productivity might just be a chimera if you believe the stats developed by AOL and Salary.com. After surveying 10,000 American workers, they concluded that American business pay $759 billion for work that doesn’t get done because employees are surfing the Web and kibitzing with co-workers.

Anyone who has ever worked in an office knows instinctively the truth of this data. What’s funny is that HR people and managers actually budget for workers to blow an hour a day on random acts of personal interest. But employees admit to wasting double the amount of time, on average 2.09 hours per day. Using average wage figures, that’s an additional $5720 per year/per worker that bosses didn’t count on wasting.

And not surprising, some of that personal Web surfing, accept where large firms have blocked XXX URLs, is to porn sites, which now account for 18 percent of all web usage, with an average time spent per adult site of 5 minutes and 22 seconds per.

Whether we are at home or at home, Americans made 70 million unique visits to adult sites, spending on average 15 minutes per site visited during April 2005, according to Hitwise. That’s 42 percent of the total 164 million unique site visitors anywhere on the Internet in the same month.

So what does this mean?

The Europeans, who make fun of our maniacal fascination with work at the expense of personal time, might be as productive as we are but more honest about their attitudes than we thought.

Work is so dull for huge numbers of American workers that they check out even when present.
Do you suppose this underlies all those business magazine stories about the search for ideas, leadership and vision?

Time wasting is clearly part of our business culture, a pressure release valve that also enables informal communication, networking and conflict resolution.

Our Puritan conceit about repressing the influence of sex is a joke.

Pornmeisters continue to pioneer sales and customer relationship techniques on the Web that mainstream marketers only dream about.

Intercepting Online Mega-Shoppers

2005-07-20T17:17:00.000-04:00

As our thinking about media and media buying converge, the notion of intercepting online shoppers when they are online and in the mood with a mouse and a credit card in-hand is the next marketing vista. That’s why a Media Audit study of online shopping by daypart from International Demographics caught my eye.

Online retail “whales” are people who make 12 or more purchases a year. Their most popular daypart is afternoons (1-6pm). Power shopping not watching Oprah is their afternoon delight. In 87 metros, these high value customers are 22 percent of online buyers or 21.4 million out of 93.9 million Americans (18+) who log on during an average month.

Looking at these stats you think “yes Virginia, people really do hate retail.” This time-sensitive, convenience oriented segment buys from home twice as often as they buy from the office, though mid-day office purchasing is significant.

Not surprising age and income are drivers of online mega-shopping. More than half (52.4%) are 25-44 versus just 9.7 percent for the cyber-savvy under 25 set. And 45 percent of the 150K+ crowd are 12X online buyers.

There are more male whales than female whales but the buying patterns are similar.
The largest number of 12X male shoppers buy from midnight till 8 am. Imagine an army of guys in boxers treating themselves to a gadget, a book or some music after a tough day at work. The same is true for women. Substitute housecoats and furry slippers or Victoria’s Secret creations for the boxers.

The lightest hours among high volume men shoppers are during work (1-6p) and during primetime TV (6-10p). The same holds true for women, who buy proportionally a bit more from 8a-11a than their male counterparts.

The real question is -- can we do anything about what we now know? Can we program banners, text ads or leader boards with whale-specific messages to be served in specific dayparts? Should we try “Midnight Madness” sales online? Should multi-channel retailers construct middle-of-the-night promotions or create off-beat streaming videos to entertain and engage these business-building buyers?

These and other daypart interception tactics have been tried on TV, cable and radio with measurable results. Perhaps its time to adapt them to a broadband universe..

Is English Enough for Global Marketing?

2005-07-14T13:07:00.000-04:00

English is the lingua franca of the global business community. English dominates communication about science, technology, commerce, media, politics, entertainment and the Internet. Eighty to ninety percent of all information in the world’s electronic retrieval systems is stored in English. 85% of all international organizations list it as their official operating language. By 2010, the number of people who speak English will exceed the 1.4 billion native speakers.

But don’t assume everyone who speaks or does business in English is getting your message, your meaning or contributing to this momentum.

There is has been considerable research done by GlobalWorks! to determine the linguistic “readiness” of foreign markets for doing business in English. They surveyed the prevalence of English language requirements in job advertisements, subscription rates at English-language magazines, studied local availability of English media, plotted the distribution of multinational corporations and their facilities, analyzed school curricula and interviewed individuals in eighteen markets.

They discovered that perceived knowledge and use of English is greater than actual knowledge and use. Comprehension, vocabulary and the ability to speak and make business decisions in English varies widely.

If “fluency” is the gold standard whereby an individual has an effortless and ready use of everyday and technical language, then the vast majority of non-native speakers are “proficient” rather than fluent. The proficient speaker can, with some degree of comfort, take part in everyday spoken and written communication but lacks the precision and fullness of comprehension that fluency requires. Speakers who are “getting by” are able to ask and answer rudimentary questions and recognize everyday phrases.

Most of those interviewed over-estimated their language capability. This tracks with existing market research. For example, in Italy, Germany and France, around 30% considered their English to be “fluent.” When presented with a fluency test only 3% from the same groups fulfilled the requirements.

Even in a market that is investing in English fluency reality lags behind aspirations. China is working hard to create the appearance of an investment friendly business climate, but the number of real English speakers is considerably less than the number reported by the government.

But the use and spread of English is still perceived as a form of “cultural imperialism” and that in many countries, culture, local laws and customs are a disincentive to learning, speaking and transacting business in English. In some cases, notably in Francophone countries, the use of English has provoked a local backlash that has influenced both the media and local language-oriented legislation.

Reactions to English in many countries fluctuate based on the political situation. And acceptance of English or aspirations to learn English is often a function of class, income, age, education, occupation and access to global media.

While English gives voice to the global marketplace, far from everyone has a functional grasp of the language. In some countries, notably Russia and Eastern Europe, the importance of English is a new phenomenon. In Asia-Pacific the focus on grammar at the expense of speaking has impeded fluency. Ambivalence about English is reflected in countries that are fighting vigorous battles to eradicate the influence of English on their native languages and purge English-isms from their vocabularies and lexicons.

For global marketers, there are several important conclusions:

1. While English is dominant, you cannot assume that everyone understands or comprehends your message.
2. Even where comprehension is high, idiomatic understanding is rare and literal translations often obscure rather than illuminate meaning.
3. Most people think in their native language and mentally translate English back into their local idioms.
4. Most people prefer their native language.
5. English should be accompanied by culturally nuanced translation wherever possible.

The Politics of Data

2005-07-13T10:56:00.000-04:00

I got an invitation from Oracle to a webcast titled “The Politics of Data” and it occurred to me that they hit the nail squarely on the head -- politics have taken over the issues of data in organizations dependent on data quality to grow their businesses. That’s why it is so difficult for companies to get the data right and keep the data clean, even though there are many available technical solutions to this persistent problem.

This is a real problem that requires a a process-oriented solution. But in most cases it becomes subject to internecine politics which derail attempts to put all the data in one place, clean it, up date it and manage its use.

Consider the typical data landscape:

1. Data changes constantly. People move. They change titles, jobs, phone numbers, e-mail addresses, locations, responsibilities, etc regularly. On an annual basis 30% of b2b data goes bad and 15% of the b2c population moves their primary address. Add to that people and companies buy things, return them, get credit, pay late, need support, etc. So on top baseline data changes, transactional data changes are constant since relationships are fluid and dynamic.

2. Data is often held by different players. In a typical company bits of data are held in different departments. Legal has the contract details. Accounting has the credit application and the payment records. Marketing has contact names and addresses of customers and prospects and is constantly collecting more of each. Sales knows what they bought and who they sold it to. Customer service has names and details of issues raised, problems solved and technical matters.

Each department tends to hold onto the information they have. They share only when asked and usually in the context of a specific incident or problem. In big companies each department might be in a different location and/or have its own system of filing and its own software for storing the data. Meanwhile nobody has a complete view of the customer so opportunities to better engage and sell that customer are lost and opportunities to annoy the customer abound.

3. Data control means job security. Salespeople, managers and marketers think that if they know critical stuff about the business, they can’t be fired. So they hoard information as a hedge against the zigs and zags of corporate life. Since everyone knows information is power, there is a second incentive to gather and hide information -- to attack rivals or to defend yourself in on-going corporate battles.

In too many organizations today, many messy and changing details are dispersed among competing people and organizations, often in different places using different data formats or systems, each of whom have practical incentives not to cooperate. It is the picture of Dorian Gray.

Yet with top-down leadership (or if I were king) this state of affairs can be easily reversed. Consider this formula based on best practices …

CEO decrees all data will live in a single data warehouse. Sets negative incentives for non-compliance and a timetable for implementation.
CIO selects and implements an enterprise data software system. Creates and administers a secure access and permissioning regime. Trains everyone and creates positive and negative incentives for rapid compliance.
CMO appoints a data czar/czarina who owns data collection, aggregation, privacy and integrity functions and devices routine updates and data hygiene processes. Marketing also is charged with analyzing data and sharing relevant insights across all departments.
Administrative help is hired to insure salespeople input data and commission payments become dependent on data compliance.

Its almost that easy, if you can filter out the politics.

Google As Go-To Guy

2005-07-12T13:19:00.000-04:00

Google, and its competitors, have become the go-to source for practical information that fuels daily life in the United States. People default to search instead of using phone books, newspapers or travel and restaurant guides. If you are not factoring this into your communications strategy, you are not in the game.

Harris Interactive studied 2100 adults and found that half of all adults use a search engine every time they go online. 88 percent of those people are searching for specific information. The leading kinds of information searched are:

Directions: By car, train and every conveyance.

News: almost 1 in 8 Americans read their primary newspaper online. 4.5 out of 10 are searching for different or alternative views seeking to broaden their understanding of a topic. Women are more likely to be searching for medical and health news than men.

Shopping: 80 percent of those searching for goods or services are also searching for the best price or using comparison engines.

Names, Address and Phone Numbers: 54% prefer online to the phone book. Two-thirds of searches are for people, half are for local businesses.

Entertainment: People are searching for times, listings, prices and reviews.

The implications are that more and more local businesses need tohave a search strategy and that classic local retail advertising vehicles (Yellow Pages, newspapers, Val-Pak) must now compete with online properties.

The ROI Fan Dance

2005-07-12T13:02:00.000-04:00

It took Forester, the ANA and MMA to figure out that half of all marketers can’t figure out how to measure ROI. Come on guys. Who is kidding who?

The “incessant” search for ROI is the biggest bogus issue in marketing today. It is a continuation of John Wannamaker’s lament that half of his ad money is wasted but he didn’t know which half and is a facet of the protracted battle between big idea brand guys and corporate bean counters over how much dough should it cost to create brands and drive demand.

The short answer, for the ADHD crowd, is that there are many credible ways to measure ROI. They have been documented and tested extensively. There is no need for a single universal formula. Anyone with an Internet browser can find them. And anyone with any persuasive skill can select a formula, apply it and use it to make credible marketing and advertising investment decisions. Surely if we can calculate the value of Pi, we can figure out which ads pay off and which don’t.

The endless search for illusive ROI is a shell game played by corporate marketers reluctant to impose the discipline of business processes on the way they plan and spend. The search for the perfect definition of ROI is an attempt to wiggle out of accountability for grand “visions” and parry the relentless demands of CFOs by engaging in fake epistemology.

Why would anyone go to the trouble, you ask?

Three reasons:

1. It is a function of who they are. CMOs generally come from the ranks of either brand marketers or PR guys. They see themselves as big picture players, stewards of an aesthetic and a magical thing called a “brand”. Their self-image is based on a big idea, executed in big media. They don’t see themselves in the same way as the suits that run Operations, Strategy, Manufacturing or other corporate functions. Their peers are at Cannes, running big agencies and hiring the latest darling director. Idea guys, strategists, visionaries and keepers of the flame don’t mess with the details.

2. It is below the line. The messy details of marketing are, in the minds of too many CMOs, below the line and beyond the pale -- lost in the mysteries of telemarketing, fulfillment, direct marketing, response rates and the ever changing and frustrating Internet. Data is always conflicting. There are few clear answers. Everything is a test. And there is much too much math. Plus there is peril in the messy details. If the average CMO lasts 22 months, there is absolutely no percentage in calculating an ROI that can get you fired even faster.

3. It is not what they watch. Savvy CMOs manage upward and orient their political game to stave off the inevitable attacks from sales leadership. Few pay much attention to the key indicators of the business. A study by the Strativity Group entitled “The Economics of Relationships” found that more than 80 percent of senior executives didn’t know the cost to acquire a customer, the annual spending per customer, the cost of a customer complaint or the value of resolving a complaint. Sixty percent didn’t know the customer retention rate. If you don’t know the fundamentals of a business, how can you possibly know how much to spend to grow it or maintain share or profitability?

Too many CMOs still think the job is about the images not about the business. Many have been successful in eluding process reengineering that has taken the ego and bravado out of finance, logistics, supply chain, manufacturing and other corporate functions in favor of a rational look at who does what, when and how much it costs and nets.

Rather than endlessly debate the definition of ROI or the number of fairies dancing on the head of a pin, more CMOs should simply embrace an existing definition, apply them and make a case for how smart marketers can truly build brands and drive the growth of businesses at every level. This will require a risk, but if you are dancing to beat a 22 month death sentence, what have you got to lose?

Manga Goes Mainstream

2005-07-08T15:48:00.000-04:00

Manga, Japanese graphic novels, and anime, Japanese animated films, have been a rage among American teens and tweens for several years. My daughter Allison has been reading and watching these stories of empowered young women --battling evil, competing in sports and school and negotiating the world of dating -- for several years. In fact, manga has been a huge industry and export from Japan for the last twenty years.

Now that US sales levels have reached $207 million in 2004, driven in-part by a steady investment of Allison’s baby-sitting earnings, CosmoGirl will launch a monthly manga strip entitled “The Adventures of CG” in conjunction with TokyoPop, one of the leading importers of this genre. GC (clever huh?), a college sophomore living in Tokyo, will be drawn in the wide-eyed manga style and will be a “spunky every-girl hipster heroine” – the kind of aspirational figure that has attracted huge numbers of girls to a genre (graphic novels and comic books) that was traditionally a male bastion in America.

Not only is the adoption of this form into mainstream media interesting, but the strip will be drawn by 25-year old Svetlana Chmakova, a woman with a decidedly non-Asian name, suggesting that not only has this form crossed cultures but that non-Japanese are embracing and morphing the form. Viz Media, another big manga house, will bring out a US version of its hit teen magazine Shojo Beat soon and will publish its greatest hits in English beginning this Fall.

And while you can find American-drawn adaptations of manga all across the Web, it will soon be at newsstands and book stores everywhere. An agreement between Dark Horse, another manga importer and translator, and Harlequin, the publisher of paperback romance novels, will produce manga versions of Harlequin best-sellers by December 2005.

So what does all this mean?

1. Globalization is working in every direction.
2. Kids usually know about and gravitate to these cross-cultural forms long before adults and main stream media types do.
3. Word-of-mouth is the most powerful form of commercial communication.
Girls still respond to traditional female themes but rally to and embrace characters that defy traditional female roles.
4. Kids expect multimedia on-demand. They expect their favorite stories and characters will be in book, online, game and animated formats accessible to them whenever they are in the mood. Before too long adults will expect the same.
5. Mythology, science-fiction, competition, success, the future, personal insecurity and the mysterious relationship between the sexes are endlessly interesting themes.

Will Big Brother Make TV Better?

2005-07-05T16:14:00.000-04:00

Cable companies are testing software to target commercials based on what they know or intuit about you. Could Big Brother make watching TV better for you?

Technology exists to track what you watch. Data mining techniques exist to discover who you are and what you like. What if the two were married together and harnessed to a rules engine that served up messages deemed “relevant” to you. Would you sit through a commercial pod? Be less inclined to channel surf? Or actually be interested in the stuff they were sending you?

Naturally “relevance” would be a function of how sophisticated the data models were. But assuming they got it right or gave you a say in what was served up to you, advertisers could target not only by household but by set-top box. They’d know which set the kids watch and which one you watch and send different spots to each TV, even though they might be no more than 25 feet apart.

This could actually make advertising more valuable and useful to the average viewer and create a bonanza for cable companies, who could sell much more inventory in smaller discretely targeted batches. At this point the gating factor seems to be cost to cable operators and proof of technical accuracy.

Likability Trumps Competence

2005-07-05T16:11:00.000-04:00

Professors at the Harvard Business School and Duke University’s Fuqua School of Business have found that it’s better to be likeable than competent in business. In research designed to understand the dynamics of work groups, they found that when you need to get the job done, a team will pick the likeable guy over the competent one every time.

And while this turns the standard managerial logic on its head, it is perfectly understandable. People want to work in a positive, relaxed environment. They want to succeed with the least amount of friction and feel good about what they are doing. They will suffer a friendly fool much faster than they will tolerate a know-it-all or an asshole.

You can overcome gaps in your knowledge and experience to succeed in a team environment but you cannot recover if nobody likes you. If you are liked people will work with you, look past your limitations and reach out to you. If you are not; you are on your own buddy.

Professors Tiziana Casciaro and Miguel Sousa Lobo conclude “a little extra likability goes a longer way than a little extra competence in making someone desirable to work with.”

What blows my mind is that seeming obvious conclusion is so counterintuitive to the legions of corporate weenies I’ve encountered. To help them and their beleaguered managers, our professors lay out some simple guidelines to make work teams more effective:

We like people who are similar to us.
We like people who are familiar to us.
We like people who like us.

Therefore if you are leading a team you should “manufacture liking” by promoting familiarity among the members, create a sense of similarity-- that we are more a like than not and in the same boat and create an intense cooperative experience to break down suspicions and differences between team members.

Although this sounds like the plot of every military “boot camp” movie ever shot, it is a lesson that still eludes too many of our best and brightest corporate types. Maybe the imprimatur of the Harvard Business Review will get somebody to act

The Power of Ambiguity

2005-07-05T16:08:00.000-04:00

Yahoo is an effective brand name.

How do I know? Professors Barbara Kahn and Elizabeth Miller explained it to me in a paper entitled “Shades of Meaning: The Effect of Color and Flavor Names on Consumer Choice” published in the Journal of Consumer Research, where they concluded “consumers react positively to imaginative names even if they are not particularly descriptive.”

The research suggests that consumers give marketers the benefit of the doubt when product names or descriptions are vague. “People jumped to the conclusion that marketers must be telling this information for some reason and that it has to be good because marketers wouldn’t tell me something that isn’t good.” Understanding marketers’ self-interest, consumers seem to be willing to do the math for us interpreting names like “Millenium orange” “Gunpowder” or “Snuggly white” as positive attributes.

And although these names make me crazy, especially in catalogues where I cannot figure out if “riptide” is the blue one or the green one, this convention of ambiguity seems to please consumers who respond to names that suggest edginess, revolution or fun.

In a series of controlled experiments, these professors found that the use of these names invokes a psychological behavior known as “conversational implicature” wherein people essentially want to cooperate and adhere to certain unspoken rules in conversation. According to this theory, developed by British philosopher Paul Grice, when things are vague, people attempt to fill in the blanks to smooth conversation.

Similarly when people encounter unknown terms, they process the new data by comparing new information with past experience and existing expectations. This “incongruency theory” suggests that when you encounter a new, vague name you work overtime to figure it out. In fact when our professors showed subjects the color first and then the name, they were less happy than when the encountered a non descriptive name first. Perhaps the uncertainty triggers fantasy and imagination that cuts in favor of the brands using them.

What’s not clear is how elastic this incongruent goodwill is. If you see a name like “Yahoo” which isn’t descriptive but is vaguely familiar you think its cool. If you see a name that is equally vague but more foreign or unpronounce-able will you also give us the benefit of the doubt?

Kahn (Wharton) and Miller (Boston College) think this works best for products that rely on the senses like food or fashion and they doubt it might fly for healthcare or financial services, but I’d be willing to try it because a name like Yahoo would bust through the boredom and the clutter and possibly inject some life and real-person credibility in these commodity categories.

It is ironic but life affirming that in a world of savvy, time sensitive consumers who are quick to filter out, click away and eliminate choices, that there is a tolerance for creativity and a willingness to play along with and buy into the imaginative thinking of creative marketers.

Will Product Placement Be a Panacea?

2005-07-05T16:05:00.000-04:00

Product placement is being served up as the all-purpose answer to zapping, TiVo, DVRs and all manner of consumers’ attention deficit to commercials. Pundits are forecasting a shift of ad dollars to product placement that is expected to reach 1 Billion by next year.

Product placement is in every media and every vehicle. Syndicators and even print publishers are finding new ways to jump on this bandwagon; a tactic that has been around since the early days of television.

The real questions are: does placement drive awareness, sampling or purchase and if everyone is doing it will individual placements be distinctive enough to make a difference?

Consider Apple; masters at the placement art. Their technology has been in countless movies and associated with memorable sequences and the hottest stars. They have a reputation for creating cool products. They have a small share of the overall market but high awareness and loyalty among a hip, fashion-forward, opinion leading psycho-demographic segment. But did seeking an iMac or a Powerbook in a film used by Tom Cruise or George Clooney make this happen or does it simply validate the expectations of Apple fans?

Part of the dynamic of product placement is an underlying fantasy about e-commerce that dates to the early days of the Internet. In this persistent fantasy, which is fuelled by data about multiple simultaneous media usage, consumers watch their favorite show on either a TV or a computer. As they watch they can click on items and buy as they watch.

The logic is that people self-select their entertainment and their favorite artists. We know that artists and stars sell products. What we don’t know is if the sales are a result of placement and proximity or if the sales are a result of either the star’s individual brand power or the attraction of a lifestyle that a star or an artist might represent or be integral to.

There is and has been product placement. There is no common source of data to measure the impact of this communications tactic. Stay tuned for the claims and counter claims as the cost increases and availability decreases.

The Zagat-i-zation of Things

2005-06-23T16:17:00.000-04:00

I rely on the Zagat Survey for restaurant recommendations. The survey complied by Tim and Nina Zagat reflected the opinions and behaviors of New York City executives and upper middle class families dining out in the biggest food carnival anywhere.

To some extent this is a mirror image of me, so I can easily rely on the opinions expressed and have pretty good confidence that , food selection aside, expectations about ambiance, service, décor and overall experience are generally the same as mine. And while there are probably psycho-demographic variations from book to book, I’m still generally comfortable with the point of view expressed.

But as grassroots ratings begin to pop-up in almost every field, I’m not sure I know who is doing the scoring or what criteria are being used to assess performance. And as these ratings get circulated on the Web, they are apt to get blanket acceptance on their face by a public eager to search and find data on-demand, without careful consideration of the sources or bona fides of those creating this data.

On eBay or Amazon you can find ratings and reviews of all types. The problem is you don’t know who these reviewers are other than people who have the time or the ego to write reviews. In some cases the reviews are themselves rated for usefulness. But the same problem of meta data exists; we don’t know who the reviewer of the reviews is and other than their command of the language. Often after reading them you cannot establish either their biases or their expertise by inference.

Imagine how this spirals out of control when every brand and every product or service from doctors and dentists to retail stores to plumbers, roofers and electricians will have prices, performance and reviews posted online. How could any reasonable person sort through them? How could any brand either influence or respond to them? And short of trial and error how could anyone make use of them? This is a serious limitation to so-called customer-generated media.

Are You An E-Mail Addict?

2005-06-08T16:24:00.000-04:00

If you thought you were the only obsessive compulsive that checks e-mail morning, noon and night --- think again.

Opinion Research Corporation and AOL surveyed 4000 people in 20 US cities and found that e-mail now rivals the phone as the communication tool of choice. Most people check their personal e-mail accounts 3 times a day and have more than one account.

Do you see yourself in this data?

61% check personal e-mail at work
60% check while on vacation
47% check e-mail sporadically throughout the day
41% check e-mail first thing in the morning
40% check e-mail in the middle of the night
25% check e-mail as soon as they get to work
23% check while in bed
18% check right after dinner
18% check at lunch time
14% check immediately on returning from work
14% check before going to bed
12% check while in class

If only the messages we got were as dramatic as these numbers.

Radio on the Rocks?

2005-06-03T15:06:00.000-04:00

There’s something magical about radio. Everybody has two or three favorite stations. Radio is comfortable. Radio is convenient. Radio does it for you even though every so often you have to endure a track you don’t like.

Many of us have a genuine friendship with or a genuine animosity toward Howard, Imus, Rush and other personalities we’ve come to know through repeated daily encounters. Most of us have radio sound tracks embedded in our memories and rely on the radio as a free, mood-enhancing utility.

Yet radio is and has been the Rodney Dangerfield of media for sixty years.

Every new thing seems better than radio. Every new media grabs dollars from radio. Every new device will kill off radio.

The latest radio killers are satellite radio and podcasting. Both have generated huge hype. Though neither has yet collected significant or measurable audiences to threaten radio’s revenues. Plus the real benefit of both is the availability of niche programming and the absence of commercials.

But with almost predictable regularity the radio industry feels compelled to defend itself. And so the Radio Advertising Bureau (www.rab.com) , where I worked as CMO for five years, just put out a “Quick Guide to Dispelling the 8 Major Myths About Radio.”

Confronting “allegations” about commercial clutter, interactivity, reach among youth, creativity, branding, listenership and business practices, these two sheets make the case for radio using all kinds of data, some of which is ancient but still true. It reads like a desperate defense. And while the conglomerates that own the majority of radio stations won’t win any popularity contests, the medium is much more entrenched and enduring than you might otherwise think.

If this crisis runs like every other one, radio stations will adapt, convert and subsume the latest trends and hottest technologies. Some have already introduced podcasting formats. For addicts, paying for Howard, will be well worth it for others it will be a blessing to get him off the public airwaves.

And radio will go on loved but underappreciated.

Deconstructing Everything

2005-06-03T14:20:00.000-04:00

We live in a world of tracks. Any one of us can deconstruct the packaging surrounding our favorite things.

Technology now enables us to buy one track (one song) without suffering through a whole album. We can select the sounds that make us happy and discard the artist’s attempt to try something new, old, borrowed or blue.

And we can build our own packages rather than rely upon marketers and promoters to package content for us. Very soon all our choices will be available for individual selection and combination. The pre-processed, fed-from-above world we once knew will become a giant salad bar free-for-all.

We’ll pick just the stories or just the writers we care about in print, watch only the great episodes of favorite shows, ditch the dreck baked into the compilations that programmers and packagers have foisted upon us in favor of our own podcasts.

Before long anyone will be able to mix their own newspaper, magazine, email newsletter, music, video or audio for use in fixed locations or to take with them. Imagine a world of specially mixed scenes on disk to amuse the kids during your drive to the beach. Or a different mix to get them ready for bed. The only gating factor will be having the time and interest to produce content for yourself.

People 30+ are not used to this process, even though as teenagers we made our own mix tapes using reel-to-reel recorders. But kids (20 and younger) hardly have the tolerance for traditional mixes, like TV networks, newspapers, albums or even DVDs and video games.

They think in segments. They expect tracks. They demand choices. They are incredibly media-savvy and judgmental. They are killers with a remote. They will invest in their own gratification because it’s intuitive, easy and accessible.

This completely changes the media game. We have to think like Billy Joel’s “Piano Man” in units of 3 minutes and 5 seconds max instead of 30 minute sitcoms, 1hour dramas or 2 hour movies. We have to understand that there is no more tolerance for the “boring stuff in the middle” because we have raised a generation that multi-tasks with multimedia and has lighting instincts and highly tuned filters.

As content producers we have to think and act like telemarketers. Sometime in each thirty seconds of conversation we have to “close” for the right to have the next thirty seconds of conversation. If we don’t, we’re tail lights. Similarly we have to conceptualize messages not as a cohesive thirty second spot, but as a string of bytes that can exist independently and hang together for thirty consecutive seconds of meaning.

Tracks make you re-think the whole game.

Life Follows Art

2005-05-30T20:42:00.000-04:00

Just in time to coincide with rave reviews of Alan Alda, Lev Schreiber and Gordon Clapp in the revival of David Mamet’s "Glengarry Glen Ross" on Broadway comes a benchmarking study on best practices for handling online leads from KnowledgeStorm and the Artemis Group.

The breathless conclusion of this study was “Leads get cold quickly, so it is vital that vendors implement prompt, effective lead follow-up processes.”

Duh!

Is there anyone alive that doesn’t know this? Does anyone need to study or to benchmark anything to figure out that if you don’t follow up, leads die?

These geniuses also discovered that most sales guys, like the actors in the play, think the leads they get suck. And that as many as 1/3-1/2 of all viable leads aren’t going to buy anytime soon and need to be nurtured for as long as a year – a task salespeople are allergic to.

Anyone working in B2B marketing confronts this daily.

It could be a universal truth. It could be a persistent conundrum. It could be a comfortable strawman for sales and marketing managers to use as a credible excuse. Or it could be evidence of bad management.

But stating the obvious only captures our imagination on stage.

Is E-Mail Prospecting Over?

2005-05-25T14:08:00.000-04:00

Two disappointing experiences using opt-in e-mail lists to prospect for new retail customers suggests that opt-in e-mail has little or no prospecting value.

Case 1. A highly regarded multi-channel retailer sells me 15,000 double-opt-in names which I select by age and geography. I pay $83 per thousand. We create a target-centric, time sensitive offer which gets through SPAM filters for all major ISPs. I get less than 100 clicks to my site and zero sales.

Case 2. The leading tech site sells me a skyscraper in a weekly newsletter. 150,000 readers opt-in for a weekly dose of niche information. I pay $19 per thousand to expose my page-dominant relevant message. I get less than 300 clicks and 6 sales.

In both cases , performance is much worse than any public industry benchmarks and worse than DM norms. Both are credible vendors. Creative is on-point, less than 200 words, above the fold, offer-oriented, well-designed and gets through tight filters.

It makes you wonder:
Has opt-in e-mail been debased into the dust?
How many people have signed up for things they ignore or delete without opening?
How many list owners are carrying these names as active?
How much longer will anyone buy these lists?

Spam Filters Spark A Creative Revolution

2005-05-22T14:48:00.000-04:00

Spam filters are driving a creative renaissance in direct marketing copywriting. As technologists set filters to exclude the most proven and the most effective words and phrases used to cue feelings of need and urgency, writers are being forced to change vocabulary, tone and phraseology.

Surprisingly this is not a bad development in spite of the fact that it has torpedoed long term control messages that have proven effective time after time. Though it is giving fits to firms that have lived off or over-relied on proven control messages to drive their businesses on autopilot.

The loss of “FREE”, “Act now”, “Try it today” and “Don’t Delay” is forcing direct marketers to use a conversational tone, a more personalized appeal and a more relevant messages, all of which have a reasonable chance to resonate with target audiences. To some extent, without these verbal crutches, copywriters have to work harder to get into the hearts and minds of those they hope to persuade. But this forced innovation is a blessing in disguise since getting through the Spam filters is the only realistic chance DMers have at maintaining predictable response rates.

In the cat-and-mouse game of e-mail deliverability, copy is just one factor. Yet if you can finesse the technical issues, copy is the most potent tool to generate awareness, interest and response. A forced revolution in phraseology can’t possibly be bad.

In fact loosing those effective, yet shop-worm terms and copy lines could save e-mail. Losing the phrases that prompt stored audio memories of cheesy announcers saying “Act Now Supplies are Limited” or Try it today and Save” can only give marketers increased credibility in a very skeptical, fragmented, attention-poor and filtered marketplace.

Heckling the Upfront TV Market

2005-05-15T19:11:00.000-04:00

Have you seen the VidLit about the Upfront Media Market?

It represents a confluence of two cool things – a book on how out of whack the value of TV advertising is and a use of online video that is very powerful.

You don’t have to know anything about advertising to agree with Joe Jaffe’s premise that the upfront is an anachronism. TV audiences are fragmented and declining while prices for TV spots, that increasing numbers of viewers zap, are soaring.

Reliance on 30-second spots are the last gasp by ad agencies and clients who really don’t know how to address the impact of the internet and who can’t get ahead of the curve on how real people have taken control of the media and the message. These big marketing dinosaurs mostly hope things could go back to the way they always were.

In contrast www.vidlit.com is an innovative use of short videos on the web. Founded by Liz Dubelman to publicize books, she’s created a bunch of very funny and effective marketing pieces that can be viewed on her site. Is it ironic that online video would be used to highlight the shortcomings of broadcast advertising?

Tactics for Using Lowly Text Link Ads

2005-05-11T22:56:00.000-04:00

Text link ads are considered ephemera by online advertisers. These tiny underlined generic words crammed into out-of-the-way ghettos at the end of right or left columns on large sites are easily ignored.

Sold by jobbers like www.text-links-ads.com to entrepreneurs and small companies, you can find them in out of the way corners of big traffic sites like NY Dailynews.com, CNET.com, Internet.com, Forbes.com and others whose publishers are happy to take the money and run.

Yet according to LinkExperts.com these little puppies are both the poor man’s entry to big-time traffic and a stealth technique to improve natural search results.

Being on high volume sites, these tiny links are on Main Street, though not in prominent positions. But all things being equal, marginal brands and direct marketers will get occasional clicks; probably as many as purchased key words might yield. Pricing can be parsed and predictable, like on Google, with comparable results based on volume and investments.

But the bigger value, say the text link savants, comes from the fact that the code underlying these ads makes a direct connection between the big sites and the guppy sites. So when search engine spiders survey the situation they credit the little guys with serious incoming links which, over time, boosts their natural search ranking on Google, Yahoo and Overture. For the spiders these obscure links are silent digital votes of confidence which shuffle the natural search rankings.

The resulting added traffic more than justifies the throw-away costs of the text links because it drives business directly to marketers’ sites. Evidently there are peddlers of insurance, business cards, gadgets, printing, and an array of products claiming positive ROI from this tactic even though it’s hard to believe that this will remain under the radar for long.

Two POVs on the Future of Advertising

2005-04-26T14:56:00.000-04:00

Your perspective on the future of advertising depends on if you are buying or selling. Everyone expects to have more control over the messages, the channels, the timing and the impact of communications in a two-way, on-demand world. But then expectations diverge.

MARKETERS

For marketers the future is a relentless series of refinements and calibrations in targeting, frequency and measurement. It begins by aiming relevant messages at those with a high propensity to buy. Based on response, the message, the medium, the timing and the offer are refined and retransmitted using the intelligent network and an array of media channels.

Highly targeted, cost-efficient communication is driven by a contact strategy, which orchestrates the content of messages and the delivery sequence through various channels for maximum impact in the shortest possible time. Rich in information and technology, marketers are eager to pick and automate their shots.

Databases drive the bus. We know who you are; we know what you want and how you become aware of your needs. We know how you research your options, how you factor prices versus benefits and how you define your own personal buying cycle. Based on this knowledge we craft an intensely personal series of messages and offers designed to engage, influence and persuade you at each inflection point. We are pushing messages at you using the intelligent network to facilitate and process your response.

CONSUMERS

Consumers of the future will have a passing resemblance to us. They will want new and innovative things. They will be irrationally loyal to the brands of their childhood. They will always love the music of their high school years. They will struggle to balance high-tech and high touch to work through the competing demands of work and home during the 24 hours in each day.

Opinion leaders, movie stars and trendsetters will influence them. So will friends, relatives and neighbors. Access to the Internet and private Internets will be available everywhere.

Personal communication devices will consolidate the functionality of watches, phones, e-mail, internet browsers, Google, cameras, encyclopedias, maps, GPS, restaurant and travel guides, English and foreign language dictionaries, keys and both ATM and credit cards into sizes, colors and shapes that will be fashion accessories. It will be easy to change devices and easy to move all your personal content from one device to the next.

Consumers will rate and review all brands like they do now on eBay or Amazon and they will insist on 24/7 customer service by phone, fax, online and by wireless devices with one-call resolution. No brand will escape from comparison-shopping in real-time across borders or currencies. Everyone from doctors and dentists to retail stores to plumbers, roofers and electricians will have prices, performance and reviews posted online.

Most consumers will expect brands to know them, to remember them, to store their purchase histories and to automatically replenish household items or routine supplies. Some will rely on brands y to remind them of service needs or check-ups. They will insist that those who collect data deliver real benefits in return. Radio silence or wasting a customer’s time will be brand suicide.

Future consumers will be persuaded to adopt new products by convenience and sleek design. They will consume foods, nutrients, products and pharmaceuticals that affect their moods, repair or optimize body performance and extend youth. They will want to fit in, look good and be like everyone else in their socio-economic, psycho demographic cohort.

Their tastes, influences and interests will change as they age and will be directly affected by education, disposable income and peers. There will always be a sizable segment that is price-driven. And there will be a growing segment that rejects cascading technology and yearns for a simpler lifestyle at a slower pace.

Today’s consumer is bombarded with 3000 commercial messages per day. The consumer of the future will be bombarded with even more messages but will expect to be in control of them, use them simultaneously and deploy a more powerful array of filters to carefully opt-in and opt-out.

Consumers will determine how, where and by which channels messages reach them. Many will be available to their preferred or favorite sources 24/7/365. Others will not. Many will change their content and channel preferences frequently. Others, mostly older people, will set them once and stick with them.

The future of advertising will be about getting on and staying on their inclusion lists. Imagine a never-ending game of musical chairs. If you are on lists in significant numbers you thrive. If you’re not, you die.

Business Week's Blog Hype

2005-04-26T13:19:00.000-04:00

Hype about bloggers and the blogsphere has reached the cover of Business Week.
The land rush is on, as the conventional wisdom becomes “get in on the ground floor of this incredible new phenomenon because if you don’t you’ll be nowhere without a blog.” And while this venerable publication acknowledges that blogging, or grass roots media has more long term potential than immediate promise, they never really spell out the fact that there is an awful lot of crap in blogs.

Verizon's Micro-Targeting Miss

2005-04-03T15:06:00.000-04:00

Micro-targeting starts with the idea that birds of a feather flock together, but recognizes that often it’s a small flock. The savvy marketer seeks to get inside the confines of a zip code to understand patterns of ethnic or social dispersion. But finding a micro-target is much more of an art than a science, since the available data runs out quickly. Good news for privacy advocates and bad news for marketers and government spy agencies.

New York, the immigrant Mecca offers a particularly good example. For instance, everybody knows that the Upper West Side of Manhattan, zip codes 10023-10025 and parts of southern 10027 represent a concentration of Jews that rivals Jerusalem or Tel Aviv in both numbers and in the nuances of practice and orthodoxy.

Similarly you can find ethnic outposts through New York City. Arabs live in Brooklyn Heights concentrated around the axis of Atlantic Avenue and Court Street. Greeks live in Astoria. Poles concentrate in Greenpoint, Irish in Hell’s Kitchen and Bay Ridge and Italians live in Bensonhurst, Caroll Gardens and “Little Italy.” Koreans have colonized Flushing in the way the Chinese took root in the Lower East Side, a century before them.

The Russians turned Brighton Beach into “Little Odessa” twenty years ago and there are still German enclaves in Yorkville and in Upper Manhattan, gay enclaves in Chelsea and even a Swedish community in Bay Ridge in view of the Verrazanno Bridge. Spanish speakers … Puerto Ricans, Mexicans, Dominicans, Ecuadorians, Guatemalans, Peruvians, etc. each have multi-block enclaves dispersed in several boroughs. Many of these communities are so strong and have such close ties to their homelands that Latin American politicians routinely campaign in New York City neighborhoods.

In the old days, a native of any of these countries could live in these communities and not really need to speak English. They could find people who lived, acted, dressed, believed and thought the way they did. And they could find familiar foods, spices, clothes and customs. To some extent this is still true, though things are changing rapidly. Ideally a marketer seeking to penetrate these discrete markets can find media to zero-in on these audiences and communicate pointed messages (often in a foreign language) that will provoke awareness, recognition and response.

But even this isn’t as easy as it seems because translating this understanding into media that will provide effective credible reach is a bitch. Several factors complicate the process, first is Americanization. Classic ethnic names no longer are predictors of ethnicity. Not all names ending in a vowel are Italians or Portuguese. You can long longer assume all names ending in “es” or “ez” are Spanish or that names ending in “ski” are Polish or “ian” are Armenian. And not every Cohen is a Jew.

Generational differences in language preference and media use make the marketers’ task even more difficult. An immigrant grandparent still speaks and reads only Russian gets news and information from Russian language newspapers, TV and radio. An adult child speaks Spanglish at work and prefers Spanish at home defaulting to TV Novellas every night on Telemundo or Univision for entertainment and Noticias 1 for news. Yet a grandchild, often living in the same home, is fully bilingual generally preferring English media but carefully reading Latina magazine at the nail salon.

Geography, language, education, country of origin, generation are the starting variables which then must be mixed with attitudes, sensibilities, income, peer influences, birth order and media use patterns to begin an effective media planning process. You can not crunch numbers to get the answer. You need a specialist who can mix science with art to understand and truly capture the micro-target you want to reach.

The misses generally outnumber the hits. And even so-called multicultural agencies often don’t have the breadth of knowledge and insight to do the job right. In some cases the mistakes are simultaneously funny and maddening.

Verizon’s current “Call Home” outdoor campaign is a great example. Some marketing nimrod put ads on bus shelters throughout the Upper West Side touting low cost calls to Warsaw. The copy suggests that a plate of pirogies is cheaper than a call home. Who knows how this message got matched to this geography.

But the reality is this is a perfect micro-targeting mismatch. The people who see these messages are those who fled Poland, were in concentration camps on Polish soil or are their children and grandchildren. The people walking bye and standing in these shelters have, at best, an ambivalence and, at worst, an enmity toward Poland and Poles. They are no more likely to phone Warsaw than they are likely to eat pirogies, a food they associate with historic anti-Semitism, oppression by neighbors and extermination.

In this case, micro-targeting was intended to resonate with and motivate an ethnic population on its home turf. This campaign will have the exact opposite effect yielding a very warm and fuzzy feeling about Verizon, the growing insensitive colossus.

Taxonomy Is Destiny

2005-03-30T15:52:00.000-05:00

Three years of global recession followed by a tepid recovery for most marketers has reduced our willingness to see beyond the immediate or the obvious. Those of us lucky enough to be buyers have been inundated with ideas, people, products and services all seeking to meet our expressed need.

Yet in sorting through the options a huge number of us have been unwilling to consider an idea, person, product or service that doesn’t exactly meet our specifications. Widespread availability has reduced our willingness to “do the math” or to think beyond simple sorting. If we need a red square and you are a red square you get a serious look. If you are a square that isn’t red, or isn’t red yet or who can be red and other colors too … forget it.

Too many of us know about the right idea, the right person, the right product or the right service that was ignored or was sorted out of consideration by a marketer looking for the easy way out. And many of us know of circumstances where the chosen solution fit the specifications exactly and performed miserably. In a world of infinite possibilities and limitless information, it’s unsettling to witness or be party to rote or default decision-making.

This uneasy state of affairs has increased the ever-present burden of definition and positioning which is now and always has been squarely on the shoulders of sales and marketing people pushing brands and/or pushing themselves. We have always had to define and introduce ourselves, our features and benefits, our competitive advantages and our points of distinction and differentiation. We were always taught to define ourselves before the market or our competitors did so for us. Today we have to define and differentiate ourselves more often, more nimbly and more emphatically to avoid being quickly and carelessly sorted by default.

Process Management Comes to Marketing

2005-03-29T23:32:00.000-05:00

Its All About the List ... Stupid!

2005-03-25T17:51:00.000-05:00

Plantronics makes telephone headsets. For all I know they make the best telephone headsets on the planet.

What I do know is that they are sending me a series of expensive dimensional direct mail pieces filled with expensive premiums and I am in no position to buy or influence the purchase of their products. They are wasting beaucoup bucks on a phantom prospect. So far I've pocketed the goodies and not responded. Perhaps at some point they'll come looking for me -- or not.

It's a classic direct marketing mistake. Plantronics put their money into high end printing, dye cuts, great premiuims, shrink-wrapping and postage. Its an impressive effort. The pieces are well executed. They generate interest and excitement when they arrive. And each one gets opened and carefully examined. But its great form without business function.

They should have put their money into buying a better list or into telemarketing and/or modeling the one they bought. They should have known that I'm a schelper not a decision-maker before they spent the big bucks to reach out to me.

It will be interesting to see what happens. In a sense what they do next will give me greater insight into the go-to-market strategy of Plantronics. In some ways I'll learn more about them from this campaign than they'll learn about me. I wonder how it will shake out?

In some companies the marketers earn their points just by getting a campaign out the door. In this case, I'm on the third touch of a highly produced campaign which probably required the coordination of many moving parts. Getting a sequence of mailings like this one out is no mean feat.

In other companies, they judge marketers on the number and quality of responses they generate. Somebody who actually runs a call center or who actually needs this stuff probably did respond. With luck, the response rate will hit the industry norm and/or the agency's forecast. So my silence can be comfortably written off as being within the standard margin of error. Mailing me is just part of the cost of doing business in a 2% response world.

In hard core companies, marketers live or die on the number of qualified leads they create that turn into genuine sales opportunities and on measurable ROI that can be traced to marketing spending. Here too, I'm probably invisible because some of the responders probably will mix it up with Plantronics' sales guys. And in the end some will buy. And while I represent avoidable waste, when they divide the costs into the new revenue generated, I'll probably get lost in the shuffle.

But just imagine how much more Plantronics might sell if they hadn't wasted time on me and 10-20% of the other names on the list just like me.

RSS ... In Search of a Reason to Be

2005-03-25T17:00:00.000-05:00

RSS (Real Simple Syndication) is a tool in search of a market. This tricky piece of technology serves up a news-like tickeron your computer screen. Behind the scenes it lobs a message onto your screen without a click. In theory it can finesse the SPAM problem and assure a marketer that the message gets seen regardless of the attitude of the end user.

The problem is that very few of us need a constantly updated flow of information about anything. Those of us who do need instantaneous information updates have Bloomberg machines or tickers or GPS devices or beepers and we don't need another desktop tool.

If you doubt me, download the weather "bug" from www.weather.com. Initially you think it would be great to constantly know the temperature and the forecast. After a few days you discover how annoying and frankly, how useless it is to know this data, especially when you are chained to your PC and never go outside.

Imagine how annoying this could be if everytime a website on your "Favorites" list added something they pinged you. Or even worse, imagine how annoying it would be if everytime a blogger posted, they pinged you. RSS has the potential to ruin your favorite things.

In the meantime, it will be hyped as the new technology flavor of the week.

Advice to Karen Hughes

2005-03-18T11:47:00.000-05:00

Karen ...

Selling America isn't as easy as selling W. Allow me to offer a few pointers from the perspective of a relationship marketer.

Americans believe that information – massaged, spun, branded, amplified and put to music – can solve almost everything. Information is our currency. We believe the more we know, the more we can fix things from the economy to the social order to who runs the country.

We also assume that to know us is to love us. But this is self delusion. Our friends, our allies and even our enemies already know us. What we think, how we look, what we want and how we act are on display every minute of every day for the entire planet to see.

Our story doesn't delight everyone. Knowing us provokes fear, envy and disgust among traditional societies. If anything our pursuit of life, liberty and happiness for men and women and W's fervor for "democracy" is a threatening and destabilizing concept to the leaders of fundamentalist cultures.

The people we seek to persuade think very differently that we do about time and constructive support. Americans believe in quick fixes. It's a given that with the right attitude, the right resources and the right brain power anything can be fixed, solved or changed quickly. We are a culture of 30-second gratification. Our audiences are not. In fact, they have the patience to wait centuries and to endure countless humiliations in search of desired results. Don’t expect too many quick wins.

Our friends, allies and enemies know the richness of our people, our spirit, our land and our resources. And they know how we have wielded these assets as sticks and carrots. They want to share in our prosperity. They want to benefit from our largesse. They have seen how quickly and generously we can mobilize in the case of the recent tsunami. But they also know that when it comes to Uncle Sam, there’s no free lunch. Our outreach effort has to incorporate the needs, hopes and practical politics of our target audiences. It probably wouldn't hurt if we didn't lie to them as often or held the same POV for more than six months at a time.

Let’s not pretend that snappy ads, exotic billboards or famous spokespeople will breakthrough to the imams, the mullahs and the tribal chieftains we seek to influence. Those we need to persuade are very sophisticated media users with highly tuned filters to cope with state-controlled media, countless broken promises and over-the-top global consumer claims.

We who preach the gospel of a consumer driven market, must let the consumers drive our messaging and marketing strategy. We have to listen and respond rather than preach and teach. We need to understand how America is perceived from the outside looking in then craft strategies to use that perspective to engage the ambivalent and the hostile.

When is a Shopping Cart Not a Shopping Cart?

2005-03-16T11:49:00.000-05:00

Ken Leonard of ScanAlert crunched a lot of numbers from the 2004 online holiday shopping season and made a remarkable discovery – people use shopping carts to compare the fully loaded prices. They load up carts on multiple sites, compare the prices and either window shop or take their own sweet time to pick the best one.

Therefore our concerns about shopping cart abandonment are as much about how, where and when we display cost elements, the limits of comparative shopping functionality and the inability to compare apples-to-apples as they are about the merchandise, the pricing or the number of clicks necessary to check out.

Published in the March issue of Internet Retailer (www.internetretailer.com), Ken tracks the lag time between loading a cart and checking out by product set. Lag times between clicking and checking out range from 19 to 61 hours. 14% of those who put items in the cart took more than a week to close the deal.

This documents customers caution and their need for comparative research. It should set the agenda for online merchants to create comparative shopping strategies before Froogle (www.froogle.com), MySimon (www.mysimon.com) or others do it for them.

Why You Should Care About Blogs

2005-03-16T11:43:00.000-05:00

Blogs are dicing and slicing the media world in ways that aren’t yet predictable. Their impact is already changing the way marketers, brand stewards and advertisers think about media. But there is much more to it that being the media flavor of the week.

Consider this recent data compiled by Technorati (http://www.technorati.com/) BlogAds (http://www.blogads.com/), PubSub and the Pew Foundation internet research people.

A. There are 7 million blogs being written. 40,000 new ones begin each day
B. 32 million Americans , 7% of those online read blogs
C. 12% of blog readers post comments, 1200 per minute
D. 5% have blog updates delivered to them using RSS (Real Simple Syndication)
E. More than half of blog readers are 30 or older and earn north of $45K USD
F. Two out of three readers shop online and have clicked on a blog ad
G. Leading reasons for reading blogs are:
1. Faster news
2. Latest Trends
3. Obvious biases
4. Better perspective
5. More personality

Americans are rejecting corporate-processed, homogenized, duplicative, plain vanilla mass media in favor of the opinions of their global neighbors. Blogs have an allure because they offer the option to observe, participate or both.

Much like talk radio and internet porn, blogs have become digital party lines that allow anyone to be in on things and to determine their own level of access, intensity and input to a zillion different conversations, often in real-time and usually in quick response to breaking news, world events or the peculiar, idiosyncratic stuff individuals’ care about.

In no time networks of blogs on niche subjects (e.g. organic food, diabetes, gadgets, tantric sex) will be selling ads, touting products, sharing best and worst lists and calling out companies who suck. The sweet irony is that evolving digital technology does not much more than enable “high touch” communications. As the world and the words move faster and faster and the gadgets have more and more functions, we default to talking to each other and to reaching out to others who live beyond the horizon and experience the world and the words from a different perspective.

Is it any wonder that somebody formed at Word of Mouth Marketing Association
(http://www.womma.org/) to capitalize on this phenomenon? Isn’t it crazy that we are so unused to actually talking to each other that somebody needs to aggregate and popularize best practices in talking to each other and become an advocate for word of mouth media as a paid advertising medium?

The potential for brands to be ground floor participants in these conversations is great assuming they are open, forthright and willing to engage people on their own terms. The “spin” in blogs looks a lot like “no spin” in other media environments. There is no more toleration for PR guys posing as blog posters and shilling for products or services. There is less than zero tolerance for corporate speak, the party line or no-answer answers. And pity the firm that pisses off a customer or seriously commits an act against the common good because the aggrieved (the one who usually just tells 10 others about how you suck) now has a global audience.

Yet imagine the benefit to brands of a having on-going conversations that yield real time intelligence about their markets, suggestions for products and services, reviews of competitors, peer-to-peer counseling and a laser-like focus on a single topic. Potentially a network of blogs is a ready-made channel for instantaneous research among customers or prospects and an early warning radar tuned to the frequency of a specific marketplace. Even better is the fact that bloggers and readers self select, so you have the potential to create a daisy chain of key opinion leaders, KOLs in pharma-speak, who you can contact, query and engage at will.

Stay tuned this is just the beginning. Though if you are itching for a mnemonic device:

Better

Linkage

Offers

Greater

Segmentation.

2005-03-15T17:38:00.000-05:00

Technorati Profile

Saving E-Mail From E-Mailers

2005-03-10T20:00:00.000-05:00

Marketers are killing e-mail, the only tool we have with the potential to create individual conversations and dialogues with customers and prospects. Obsessed with its low cost and speed, they bombard the 78% of online customers who actually opt-in with tons of forgettable annoying ads.

Retailers are the worst culprits. They have transferred their deep and enduring love for circulars to the digital domain. Now they can hammer us with crap for pennies every day or every week or every fortnight.

It’s no surprise that frequency was a big topic at The BigFoot Interactive E-Mail Summit. The reigning wisdom is to “hit the list hard and often” and “continuously add new names” Unfortunately these tactics will burn out the audience and destroy the credibility and general acceptance of the medium before we get really good or really sophisticated at using it.

E-mail will have legs if we don’t kill it first. The medium has the potential to be a true 1:1 medium with nuance, tone and great personality. One way to save the medium is to take a longitudinal view and to conceptualize e-mail in campaigns and message sequences driven either by individual information or by predictable events. That way we can test and learn before we crash and burn.

Most of the e-mails I get are one-offs. I haven’t experienced sequential campaigns of several messages. And I’ve never been conscious of being on the receiving end of e-mails delivered in a multi-channel context where postal mail, e-mail, catalos, phone calls or live interactions are orchestrated to engage and motivate customers.

I’m eager to learn if a two, three or four part sequence, which works well as postcards, works as well as e-mails. I’m dying to be romanced (or blitzed) by a retailer who will hit me high with a catalog, hit me low with an e-mail, sneak up on me with a bill stuffer offer and hit me straight on with a phone call all within a 48 hour window with offers of stuff they know I like, I want and I can afford. And these are just ideas off the top of my head. There is a whole world of experimentation and learning at risk.

The current ham-handed approach assumes that the sender has to know the unknown. Retailers bang away at me either with a single offer, not linked to my purchase history or my expressed preferences or with a newsletter smorgasbord of offers hoping something will catch my attention.

Why not just ask me what I want, how I want it and when I want it and then do what I ask? It requires a bit more technology, but it pays out 100 percent better. There is considerable evidence that consumers aren't bashful. They will gladly tell you what they want and how they want it. And there is growing evidence that consumers disproportionately reward retailers who listen and respond to those who take them seriously and deliver on expressed preferences.

Consider this tailored e-mail scenario:

I buy 4 towels on your site. This event triggers a follow-up e-mail within 72 hours of delivery asking if I liked them and offering me matching wash cloths or hand towels. In my marketing utopia, this offer mirrors the one-sheet or the personal letter you slipped into my shipping box.

It might even be worth asking me if I want a few more, assuming I liked the first bunch. Imagine if I was a high value customer? You might wait 36 hours after e-mail transmission and call me to reiterate the e-mail offer. A skilled telerep might up-sell me better goods or cross-sell me a matching bathrobe, expensive bath oils and unguents or a color-coordinated soap dish.

If I don’t bite, wait. Send me an e-mail within 30 days. Offer me a reduced or clearance price. Better yet, use my purchase as a qualifying event and reach back into earlier purchases to tell me “because you bought the towels, you get first dibs on the polo shirts that you haven’t bought in two years”

E-mail can follow me and mirror merchandise orpricing cycles. E-mail can create a back-and-forth flow of information and loyalty. E-mail can do things we haven’t really figured out yet. Let’s try not kill it before we master the tone, the texture or the tactics of the medium.

The "So What?" of Social Networking

2005-03-10T14:54:00.000-05:00

My dad used to tell me "Its not what you know but who you know." The online social networking phenomenon threatens to use technology not only to facilitate digital schmoozing but potentially to leverage my friends contacts' and connections and their friends' networks as well.
Though frankly my friends are hardly that generous.

As a marketer the proliferation of social networking sites like Zero Borders, Spoke, Friendster and Linked In or the addressbook sites, like Plaxo and Ringo, who have the 1-click ability to quickly sweep your contact list into the maelstrom, might be very credible word-of-mouth communication channels both for personal and brand messages. I guess the value of the channel will be determined by what you want to do with it.

So far without all these guys (by simple batch e-mail) I'm able to convince a bunch of my contacts to sponsor my sorry ass in the annual AIDS WALK. I'm not sure if its the cause, the modest request of $25 bucks or the perverse pleasure of imagining me and my dog actually walking 10k that persuades them. I doubt the media vehicle -- e-mail -- counts much in their decision to help or not. I doubt my yield would double if I asked my friends to ask their friends.

I signed up on all these sites. I guess I'm not much of a connection. So far, I've been asked to make 1 job introduction for my friend's b-school buddy from Texas, updated my address a dozen times and had 2 headhunters track me down. I'm not giving out much and getting nothing in return, probably par for the course in relationship land.

Jim Dickie of CSO Insights tells a different story in DestinationCRM magazine. He says that on Linked In his 54 contacts knew 500 sales VPs. He selected 30 and asked them to make an intro for him. 29 complied and of those 23 actually made the connection from which 18 participated in his questionaire. Jim is scoring it as a 60% response rate, which even if you quibble, is significantly better than if he'd had cold called the target group.

That's the potential. People sign up knowing they might be contacted. They trade who they know for who you know in the hope that somebody knows somebody who will open a door, make a connection, take your call or give you a break. I'd like to give it a whirl.

The Basics Are Still ... The Basics

2005-03-06T23:29:00.000-05:00

Did you see the recent survey data from Vertis, a Baltimore-based direct mail house?

They discovered that 1 in 4 of 2000 adults surveyed who received a direct mail solicitation from a retailer actually visited the store within 90 days of receipt.

For 2/3rds the size, shape, color and external copy influenced the decision to open the package. And for another 51% a special offer or a discount motivated them to pay attention. The older you get the more likely you are to be affected by direct mail, since older and younger Baby Boomers embraced direct mail slightly more than their Generation X and Y siblings.

In order of responsiveness, coupons, buy one-get one free offers, single discounted items and percent off offers work best. Though each of these tactics worked to provoke a response from more than 50% of survey respondents.

In a world of real-time, fragmented, 1-to-1, 24/7 media there is something very comforting in these results. It suggests that the medium, the speed and even the frequency of messaging is secondary to the basic appeal of a deal delivered directly to you by name.

Measurement Mania

2005-03-06T23:16:00.000-05:00

Now that CMOs must justify spending more often and in more detail they have found the religion of metrics. But like many converts in a rush to offer louder and louder hosannahs, they miss the nuances of the measurement game.

The biggest single error is to measure anything they can measure rather than measure things that impact on the performance of a business. Usually the earnest metrics novice latches on to whatever data is available. In no time we know the cost per service call, the the number of web inquiries divided by the cost of website hosting or the cost per unit of postcards multiplied by the number of names targeted. Soon high minded KPIs follow.

And while amusing, most of these numbers don't really tell us anything useful either in terms of the happiness of customers, the glide path for acquiring or retaining customers or the profitability of the deals we are doing. Too often we measure activity rather than productivity. And productivity requires context in terms of organizational objectives and goals.

The object of measuring is

1. to set and measure progress against definable objectives

2. to understand the factors influencing productivity and profitability

3. to find inflection points to maximize yield from resources.

Metrics ought to be organized to acheive these basic objectives. Anything less is just trivia.

Agency Bills Under Scrutiny

2005-03-02T12:38:00.000-05:00

The Shona Seifert conviction raises to broad consciousness the billing practices of ad agencies which have been notoriously opague for as long as anyone remembers.

Agencies lag behind law firms, accountants and other professional service organizastions in making investments in sophisticated billing technology. And as Shona Seifert said in her testimony filling out timesheets accurately and on time is counter intuitive in most agencies.
Anyone who has ever worked in an agency knows how difficult it is just to get the time sheets filled out and collected, much less assess accuracy and/or forecast revenue yield.

As a result it is not unusual to get a convoluted bill. And it's almost impossible to measure cost versus value received. Perhaps the revelations of the way-less-than best practices at Ogilvy will inspire agencies to improve their billing performance and to make financial issues more transparent to clients. Let's hope so.

Integrating the Internet for Maximum Marketing Impact

2005-03-01T19:02:00.000-05:00

Can you believe it? We are still trying to understand the role the Internet plays as part of integrated marketing processes and systems. In spite of significant experimentation and investment, we haven’t yet truly internalized the power we hold in our hands. But we do have a number of hypotheses to consider.

1. User experience ruthlessly drives perception, acceptance, adoption,commerce and usage. If it isn’t easy to use or requires too many stepscustomers bail out. Traffic is a gift that must be cherished, nurturedand converted. What people do and see on your site is the most important thing.

2. E-commerce is a multi-dimensional, multi-channel game. Buildingsustainable retail businesses is about coordinating messages,merchandising and technology at many points along the awareness-consideration-purchase spectrum. Winners leverage the best capabilities of each channel (ads, web, phone, mail, store) into acoherent, sequential strategy.

3. Simple intuitive navigation and shopping requires sophisticatedbackend technology and sophisticated metrics and analytics to optimize activity, nimbly adjust to your customers and maximize conversion. The measurement investment is equally as important as the technology.

4. Measured business objectives must drive technology deployment. If the new toys don’t drive traffic, close sales or eliminate costs, they are simply extra costs. Just because you can cook it up, doesn’tmean anyone wants it or can use it profitably. Beware of software salesman.

5. The Internet has not changed customer psychology or intuitive andingrained behavior. The web fits into existing patterns of behavior, habits and expectations. Java and gifs don’t change how people think about, talk about, anticipate or undertake shopping. As a result the new ideas and new technology must serve consumer patterns. The mountain will not come to Mohammed.

6. Change is very hard to sell. Most consumers and businesses are anxious about technology. The burden of translating the vision for those locked into convention thinking lies with visionaries and marketers. If in doubt, assume that your target audience cannot or will not do the math for you. Assume that they won’t get it unless it is very simple, plain to follow, written at an 8th grade level and in their faces.

7. Multichannel brand integration is critical. The Web facilitates 24/7/265 availability for a brand and a platform to align brand values and brand voices on a global, immediate and dynamic basis. Many firms have successfully integrated the look, feel, tone and manner of their brands across advertising, POS, the web, mail, phones, stores and sales force.Many have presented consistent merchandise, product catalogs, and return or credit policies across platforms and geographies to serve customers better and optimize investments. The web offers us the next, best chance for brands to speak with one voice across markets and across the globe. But getting there, especially in large matrixed organizations can be a nightmare.

8. Data aggregation is a necessity. he Web is clearly a competitive tool for aggregating data from multiple sources and for extracting data from legacy systems to optimize business decision-making. The web expedites a firm’s ability to economically organize, filter and display data in ways that yield real-time competitive advantages.

9. Integrated marketing and communications are basic table stakes.The Web facilitates message management, targeting, tracking, automation and measurement. Integrating channels allows you to leverage investments in sight, sound, imagery, photography and copy. Synchronizing messages and allocating budgets to target distinct segments using specific media yield improved ROI and reduce the cost of contact, sale, acquisition and usage stimulation.

10. The Web is a sales platform. The Web is a transactional tool with the ability to store transactional histories and serve up appropriate repeat, replenishment, up sell or cross-sell offers. The next challenge is to understand the dynamics between online and offline commerce and leverage strategy and technology to maximize returns and conversion. The best players are experimenting with mix-and-match combinations of media and messages to identify the number and the channel of customer contacts necessary to yield cost efficient conversions.

Picking Perfect Partners

2005-03-01T18:15:00.000-05:00

Finding the right partner is a central human dilemma. Some of us get it right, usually after a couple of tries. Finding the right marketing partner can mean the difference between success and failure.

Alliances and partnerships are key components in the search for efficiency and innovation, but few marketers choose their allies in a systematic way. Too many firms are still doing the equivalent of "eenie-meanie-miney-mo" when it comes to sorting out who can best help you succeed.

Gartner predicts that more than 40 percent of technology companies will commit significant corporate assets to partnerships over the coming year. If you look yourself honestly in the mirror, you realize that there is nothing philanthropic about partnerships. Partners are chosen and deals are designed to extract benefits, sometimes mutually, for the parties.

Generally the benefits come in one of three flavors ...
1. To establish or borrow credibility and access. You are nobody. They are somebody. By hooking up you gain credibility, reputation by association and access to their client base.
2. To pre-empt investment of time, people, money or power. You pick an ally to gain access to a partner’s learning curve, technology, workforce or competitive advantage. In theory, your savings and the acceleration of your business that results nets benefits to your partner. Using the skills, people, insights, connections, technology or tactics of a partner can be a springboard to success.
3. To road test a potential merger. Some partnerships are preludes to acquisitions, mergers or takeovers. During the partnership period the successor firm gets to understand the key assets, the critical players and the not-so-obvious nuances of a business, which positions them to gobble up the partner efficiently.

Given the significance of partnership as a business tool its logical tothink that the selection process has to be a matter of strategy. Consider a two-step process to screen potential allies. Step one, the business equivalent of a chemistry check, will eliminate obvious mismatches and level the playing field for negotiation.

As a firststep, ask the following:

Is there a brand fit?
Does the prospective partner align with your brand and your customers?
Do they have a reputation on a par with yours?
Will an association with their brand raise the perception of yours?
Do they offer a product or service that your customers know or care about?
Could a customer easily or intuitively figure out the link between your brand and theirs?
Is there a common approach? Does the partner think like you do?
Do they approach customers with the same perspective on product quality, urgency or service? Are they driven by similar financial concerns?
Do they use similar metrics to measure performance or to steer their boat?
Does a family, a despot, a committee or an unseen investor run them?
Who will be your liaison person?
Are they the same size?
Will you eat the bear or will the bear eat you?
Who needs whom and by how much?
Will the level of need change over time or as a result of market activity?

While a win-win is the best entry posture, understand and articulate clearly what you expect to gain andwhy. Then have a “plan B” in case things don’t work out.Too many businesses have signed up all kinds of partners and build all kinds of channels in a mad rush to seem real and to issue press releases implying “forward momentum.” Many of these partnerships aren’t worth the paper they are touted on.

Undoubtedly this sounds like the advice you’d give a seventh grader with a crush. But many marketers haven’t remembered their junior high mating rituals or overcome the embarrassment of being the last one picked in a schoolyard game when aligning their businesses with others.

Once a prospective partner meets these initial criteria, it’s time toget granular and dig for data or surrogate information. Due diligence is more than picking up a dinner tab. So get out a yellow pad and write down the answers to these questions:

A. What is the partner’s annual sales revenue and rank in their category?This establishes who has the leverage and gives you a baseline for reckoning likely expenditures for non-public companies. Also understanding transaction averages, frequency and cycles will give you an understanding of how and when the partner needs help, thereby defining some of your value and most of the inflection points for negotiating.

B. What is their geographic profile and how does it overlap or compliment yours? This asks you to look at distribution, employment and tax patterns. It inventories the boundaries of any deal.

C. Who are their customers, their best customers and how do they overlap or compliment yours? This tells you how high is up and gives you a perspective on how much poaching is likely. It is also useful to know the distribution and concentration of customers or product orders to see whom has who by the tail and to understand the operative dynamics of the business.

D. What stage of growth is your partner in? This is a surrogate measure for understanding how aggressive a partner might be and how much they might need or value the deal.

E. What legal or regulatory issues will come to bear? This gives you a feel for how hard it will be to get a deal done and what parameters might pre-exist in the negotiation.

F. Who will eat your partner’s lunch? Diplomats operate on the principal that the enemy of my enemy is my friend. Understanding how a partner aligns himself and who is gunning for him, is critical in weighing any decision on your part.

G. How will you measure performance? It’s not enough to glance longingly at the eye-candy attached to your arm. A partnership needs to have definitive goals which can be measured and counted by both sides.Without a goal and a way to measure, you’ll never know if its worth it.

If this sounds a bit Machiavellian for you, consider the consequences ofa partnership gone sour; loss of prestige, litigation, significant income loss, employee attrition, etc. Alliances are about bargaining power.And alliances are more like relationships between nations than a marriage. Finding the right balance of power and striking the right tone of diplomacy are the critical success variables.

How Personal Do you Need to Be?

2005-03-01T18:11:00.000-05:00

1:1 Marketing is an idea that is intuitive to direct marketers. If you address people by name and tailor messages to what you know about them or to interests they have expressed, they are more likely to respond and purchase. DUH!

Implementing 1:1 is a lot easier said than done. Principally because there is no widespread data or consensus on how much personalization is sufficient or how it pays out. The web, according to a wide array of geeks, seers and pundits, is capable of relatively inexpensive personalization, using database driven, dynamically generated custom-tailored content, which yields the potential for marketers to create, manage and sustain customer relationships. So far, no one I know has confessed to me any relationship with any website.

Anecdotally, Patricia Seybold told the NCDM that, for American Airlines, “Website personalization steadily increased regular logins and bookings . . . showing that personalization increases both loyalty and revenue.” But she didn’t tell us how they get from “Dear Danny” to loyalty and revenues. Marrying each individual to the stuff they most want to know is the promise. This desired intersection of interests and information creates a psychological validation, a feeling that the company speaks to just me, a sensation which we’re all looking for in our lives.

Sounds too good to be true. For me, as for most of us plebs, getting a company to speak just to me about my account, my bill or my concerns is a nightmare. Unless, of course, I owe them money.

1:1 Marketing has become an empty cliché. Why? Because the incremental cost versus the incremental lift in response, sales or customer satisfaction doesn’t automatically pay out. The big question is . . . At what point does customizing messages or content yield added sales and loyalty and at what point does it just yield diminishing returns? If the prospect has already shown interest by calling, mailing or clicking, will the added impact of personalization expedite the sale or just add expense?

To start with, no one is sure if personalization means calling a customer by name or simply providing content as specified by a consumer, explicitly, by filling out a questionnaire or profiler, or implicitly by dynamically serving content based on past site visits or page view sequences. I haven’t seen any data to suggest if either tactic yields greater customer satisfaction or conversion. I do know there are growing numbers of cybernauts who consider the latter technique snooping.

As if these choices weren’t confounding enough, they are further complicated because context and tone affect the perception of personalization. Netflicks talks to me by name. But since I expect only listings, and spend barely a few seconds reading the e-mails, the impact of seeing my name is negligible.

In contrast, sites I rely on for daily stock prices, horoscopes, box scores, and news, never use my name. But because they deliver exactly the stuff I’ve specified, I don’t miss, nor do I expect, a personal greeting. I’ll take the information. Forget my name.

We are all closet egomaniacs. The first thing we look at in any communication is our name. Spell my name wrong and you immediately alert me that you are a stranger, an outlander, an interloper or someone who can’t be trusted with key facts about me.

Super sales coach Jack Carroll starts his e-zine by calling me “Danny.” I almost hear his voice when I click on the e-mail and I hear the text, as if it’s being delivered orally, as a pep talk. Yet when the Passport Wine Club with “Bonjour Daniel,” it provokes an acid flashback to elementary school French class where Mary Ann Pessignelli tortured me for weeks. Peppers and Rodgers call me by name, but their ceaseless self-promotion and self-congratulatory tone (“This week we helped a voracious multi-national ravage the planet . . .”) embarrasses me.

There is some evidence that personalization without live contact falls flat. An NFO Interactive survey found that customers would spend more money if they could talk in real time to a customer service rep while they browsed a website. One in six shoppers, who said they had never actually purchased, claimed they’d become buyers if they had real-time contact.

This sounds right. But it’s far from the low cost solution. In fact, it’s the opposite because you incur the cost of web tech plus the costs of live operators and web-telephony interface. Given the fact that most marketers are directing prospects to the web to promote do-it-yourself buying and to reduce the cost of sale, this survey turns that assumption on its head.

And so we’re left with a series of Talmudic questions …
How much personalization is necessary or enough?
How little is necessary to begin or continue dialog?
How many dollars are worth risking for personalization?

A Search Engine Primer

2005-02-28T14:35:00.000-05:00

The Internet is a vast repository of information without a uniform system for filing, access or storage. The most effective search engine can locate 60 percent of the existing content. The smallest can only find a mere 2 percent.

Why do you care? Because search engines drive traffic to your site, quality traffic… people actively seeking something related or relevant to what you’ve published.

Being prominently listed in a search engine’s results presents your site to prospects and customers immediately after they express a direct interest in your topic. This is the moment direct marketers live for. You deliver the right message at the right time to the right audience. It is as close as we get to the chemical formula for conversion. There is no greater kismet moment in cyberspace.

Yet these magical moments don’t come early or often. In fact, achieving consistently favorable search engine results requires the instincts of a cryptographer, the focus and intensity of brain surgeon and the insights of a psychic. That's because search engines play a complex game of cat-and-mouse with those seeking “search optimization”. To properly make the continuous moves and countermoves necessary to be ranked among the top 10 results above the fold is a full time job.

To guide you through this changing array of algorithms designed to tag, sort, file and retrieve your site and its content, here’s a guide to the basics of search optimization. Search engines are digital reference librarians. There are three garden varieties.

I. Spiders

Spiders are computerized robots who automatically pull up pages and tag, sort and file by machine, based on pre-programmed assumptions. They are necessary because we are creating new web pages much faster than anybody can count or catalog them. Different spiders take different things into account. And just to make it interesting, they change their matrices all the time. That’s why a site can rank in the top 5 one day and in the top 50 the next day.

Search engines are moving targets. You have to monitor them constantly to be successful. Natural search engines automatically retrieve documents from the Web and follow all built-in links. The “bot” leaves a catalog trail of both.

They can start anywhere and, like natural predators, they move according to their own rhythms. Spiders feed pages to the search engines which, in turn, feed them to searching surfers. The best way to influence spidered results is to focus on 4 critical variables:

1. Domain. A strong component of the search engine algorithm is whetherthe keyword is in the domain name. For example, if you are searching for books, books.com is a sure bet. The closer your domain name mirrors what you are or what you do – the better.

2. Title. Does the search term appear in the page title? Every page on the Web has a title slug. If the name is in the title, the bots pick itup easier. Placement of the title is also important. Large title words repeated often at the top score best.

3. Links. Search engines look for the number of links and the relevance of the sites linked together. Google counts and ranks the number of links to assign your position when the search results are presented more links imply more relevant and used content.

4. Meta Tags. Meta Tags are keywords and characters or phrases embedded in the HTML code that users do not see. They are critical tools in the battle for optimizing search results, even though not all engines use them and some are programmed specifically to ignore meta tags.

While not visible to the viewer, the spider searches the meta tags and often ranks a site based on the number of times the keyword appears in the meta tag. In the old days site designers loaded up the meta tags with theword “sex” ( the most searched term ever) till search engines got wise to the practice. Today you must be careful that the word is not repeated too many times, or the engine’s spam detectors might automatically exclude the page.

If a keyword is important, it should be repeated a minimum of seven times, preferably in large fonts at the top and in the title of each page. The two most important types of meta tags and phrases for search engine indexing are:

A. Descriptions. Each web page has a brief, unseen summary description.If you don’t create it, the bot will. If you write a description of thepage in place of the summary the search engine would ordinarily create,you describe and categorize yourself. This substantially increases the chance of being ranked high in searches for your topic.

Descriptions must be less than 25 words. Search engines use a set amount of characters in the descriptions they return. If yours is too long, it will be cut off and so will your chances to optimize results.

B. Keywords. Each page can be coded with keywords to direct how your site in indexed or sorted. If you provide key words for the search engine to associate with your page, you self-define when and who will find you. Search engines don’t make judgments they find the key words. Less than 50% of web pages use key word and description metatags, so using both works in your favor.

II. Directories or Indexes

Directories or Indexes depend on humans to do the tagging, sorting and filing. Yahoo! is the largest one. They have editors reviewing content and determining whether to add sites to their database. When indexes search for key words, they take four metrics into account:

1. URL: Is the keyword in the URL?

2. Title: Is the keyword in the title?

3. Description: Is the keyword in the actual description of the site that the viewer sees? The description is usually written by an editor, but the editor often uses part or all of a description provided by the site. Because the index is scouring the content of these descriptions for keywords, controlling the description is crucial to search success.

In the index game conforming to emerging norms is the best bet.Remember that human editors are looking for the easiest, fastest way to get the job done. Piggy-backing on trends simplifies their job. Look carefully at descriptions on other sites and conform as much as possible to the style and length that prevail within the index. Unfortunately each index has its own editorial norms so you have to do this for each major index.

4. Traffic: Some indexes and some pure engines take traffic into account when determining rank. They rank your site based on the number of times people click through to it on their engine. If your site is getting more clicks than the site above you, you move up in the order of presentation.

III. Paid Search

Most search allow you to jump the line for money. There’s not much more to it than deciding which words you want to buy and how much it’s worth to you. The results are usually displayed separately and are graphically separated from natural search results. Nonetheless people searching are clicking on paid listings.

The key aspect of the pay-per-search game is avoiding terms that get bid up in price quickly and identifying key words which you can own or which will deliver a high percentage of customers to you and not to your competitors.

If you are the kind of person who, in Walter Mitty moments, imagines yourself in a musty, airless room cracking the Japanese “Purple” code, then search optimization work is for you. Ensuring top rankings is a continuous process of monitoring and making refinements based on Web site modifications and changes to search engine criteria.

For most marketers, it is almost impossible to keep abreast of the mercurial changes engines and indexes make to determine rankings. You need expertise and time to even have a shot at doing this right. The smartest marketers are outsourcing this to specialist agencies. My favorite is Acronym in New York.

Loyalty Marketing: Sister Hummel's Epistle

2005-02-28T13:45:00.000-05:00

Goebel, makers of “Hummel” porcelain figurines, those tschachkes that everyone’s Grandmother has and cherishes, is celebrating the 25th anniversary of it’s collectors club, the oldest in the USA or so they claim. Club marketing, the poor man’s CRM, has had both a remarkable impact on the brands using it and a remarkable history of experimentation.

With 250,000 members in the United States the collectors’ club accounts for a huge percentage of recurring sales, which Goebel counts on as baseline revenue each year. At retail prices ranging between $100-$350, club members generally buy 3-4 units per year and can be generally counted on to buy another “club exclusive” not available to the public and refer at least one new lead annually. All in all, the club is a dynamic element in the Goebel marketing mix, which provides sales volume, customer feedback, marketplace intelligence and brand direction at a minimal cost-per-sale.

Rooted in the twin premises that … an enhanced brand experience nets a higher lifetime customer value and … that it’s easier to sell existing customers more stuff than create new customers, club marketing seems like a no-brainer. All you have to do is sign up your best buyers, give them an occasional deal, send them a newsletter and … presto … you have guaranteed sales of hundreds of thousands of units each year. If only it was this easy.

And while everybody from professional sports teams to consumer products companies to car manufacturers have embraced affinity or loyalty marketing, very few have got it right and gotten it to pay off either in terms of units sold or brand loyalty.

Consider these variables, and lessons learned from the adherents of Sister Maria Innocentia Hummel’s cult.

1. Own The Customer Relationship.

You can’t relate to customers if you aren’t prepared to respond to their needs. In many business categories the manufacturers of the brand distribute products through retailers. Each claims ownership of the customer relationship. Sometimes their interests coincide. Sometimes they don’t. Too often, in spite of intramural wrangling, neither makes much of an effort to add value, communicate with or interact with end users. But if you expect to build a brand, the brand has to own a relationship with its heaviest users. To concede away this link is to place your fate in the hands of others. It’s a recipe for disappointment leading to disaster.

Yet, if you own the relationship, you must answer the phone, mail, fax and e-mail, provide credible customer service and be ready, willing and able to engage customers’ concerns, questions and needs. It requires a substantial investment of time, attention, people and capital. It can be very annoying. The investment requirement often gets retailers and manufacturers at each other’s throats since retailers prefer to control the interaction and have manufacturers cover their costs or pay them for services rendered.

Relative brand loyalty also plays a factor. Some of the Goebel club members exclusively collect Hummels. Others collect all manner of dust-collectors from any number of competitors. A decision to own the relationship often is the by-product of an estimate of the potential ROI. Yet in a world of weary middlemen fearful of disintermediation, whomever controls the brand needs to connect with primary customers.

Another important aspect in deciding to own the relationship is the nature of loyal customers. Often, they don’t match marketers’ conceptions about who their best customers are or ought to be. It can be sobering to realize that your best customers are lower middle class, Middle American, blue-haired women, most likely of German-American extraction concentrated in second tier cities and small towns wearing stretch pants and driving 5 year old mini-vans.

It can also be upsetting when their love of the brand does not coincide with the immediate marketing agenda, the new brand identity guidelines or the new product line. Nonetheless they drive your volume. Brand stewards need to overtly or covertly own the relationship and influence the direction of marketing-oriented clubs. To do otherwise is to lose control of powerful brand advocates.

2. Use The Club Aggressively

Club members are totally into your brand. So don’t be bashful about asking them questions, profiling them and seeking their advice. When it comes to interacting with your brand, club members have very few privacy concerns. On the contrary, they want you to know them and schmear them.

Too many marketers prefer either to dictate or guess at what their best customers want or will respond to. A club offers a test bed, a ready-made research panel and a practical compass for campaigns and product development. These are people eager to help, even if they ask too many questions, constantly demand freebies and have all kinds of wacky ideas. You can’t afford to ignore your best customers, but you may need to filter their enthusiastic input.

The same energy that attracts club members can also be harnessed to drive marketing initiatives. Ask club members for referrals. Allow them to earn discounts for referring new members or purchasing selected products. Give them a heads-up on new products and new campaigns to guarantee baseline street credibility or advance word-of-mouth. If their impact on your brand is significant, customize creative messaging for them.

3. Offer Real Value

The Hummel Club offers it’s members … a free gift on joining and with each annual renewal, an exclusive series of products, unique annual Christmas plates, bells and angels, a quarterly newsletter, an annual behind-the-scenes trip to the factory in Bavaria, an annual convention and opportunities to meet visiting artisans during their publicity sweeps through the US.

This array of offerings is not philanthropy. Every club activity yields a profit to Goebel. Each has been requested by and tested with club members, who since 1981 have formed themselves into 70 local chapters in the US alone. Each component was added incrementally and each required the brand to balance practical growth objectives with the idiosyncratic needs of club members.

The allure of club marketing, especially to members, is insider knowledge and access.
Serving this primary motivator is the key to effective club marketing strategies. Don’t ignore the greed factor either. Many Hummel collectors calculate and obsess about the value of their pieces on the secondary market. If you doubt me, check Hummels on eBay.

Here product knowledge and nuances can affect secondary prices and the value of larger collections. Club members want to know every detail about artists, production, painting, back stamps, issue dates, etc. since the details often determine the difference between very valuable figurines and also-rans. The same is true in many product categories.

Club marketing requires recognition and aggressive management of a community of people and interests coalesced around a brand. These interests are not necessarily aligned and are often in conflict. The marketing challenge lies in sorting them out and harnessing them to drive brand recognition, growth and direction. Meeting the challenge can sustain and enrich your brand.

Consider the Goebel example. Cutesy figurines of Bavarian children in everyday activities made by a tubercular nun in the 1920s and 1930s and realized in glazed porcelain … a momentary fad, which should have died out when the GIs returned from occupying Germany after the Second World War, is still wildly popular. Sixty years later almost a quarter of a million Americans spend $1000 religiously each year to collect new figurines, talk about them, swap them and interact with others who do. It’s not only the legacy and artistry of Sister Hummel. It’s smart loyalty marketing.

E-Mail Split Personality Syndrome

2005-02-28T13:33:00.000-05:00

I’m having an e-mail identity crisis. It’s especially severe because it coincides with an out-of-body experience. I’m trying to sort out my e-mail accounts as an individual. But as a marketer I’m astounded at what my morphing personality means for those seeking to identify, reach or persuade me. And at the risk of becoming a focus group of one, I suspect that I’m not the only Sybil in Cyberspace.

I have 5 e-mail accounts from 4 separate providers organized on three computers. I’m trying to figure out who I am, where things should go and whom I should trust to receive, store and archive stuff that matters to me. Until now I’ve had everything go to my office mailbox. The result is 100+ messages a day -- ranging from marketing e-zines, travel alerts, stock quotes, horoscopes, opt-in retail offers, notes from cousin Agnes and lots of Spam – on top of the business notes, reports and decks flooding in. It’s time to separate the information streams and direct them to specific accounts for my own productivity and sanity.

Evidently, I’m not alone. International Data Corporation pegs the current number of e-mail addresses at 1.2 billion e-mail boxes receiving 36 billion e-mails. E-mail is already the number one activity on the web and widespread home and office use suggests that many of us have multiple accounts and multiple identities online. Moreover the ease of creating new Web-based e-mail accounts will continue to bedevil the FBI and direct marketers’ for quite some.

It’s a whole lot more complicated than my snail mail box, where personal stuff, office and business correspondence, bills, magazines, catalogs and Spam reliably show up under the watchful and skeptical eyes of our mailman, a USPS lifer with thinning hair, half glasses, a shuffle step and an arthritic stoop.

Ironically my identities can be deciphered by a skilled direct marketer with access to widely-available software that can match D, Daniel, Dan, or Danny Flamberg and all the mutations and variations using street address, zip codes and other data points. In Cyberspace my identities are much more varied owing in part to innumerable security scares and the anonymous ability to project my warped psyche as distinctive user names and passwords, which often satisfy me but are hard to remember.

I decided to steer professional, marketing and business-related stuff to one account. Travel, retail and association alerts, offers and routine stuff to a second. And friends or relatives are now vectored to a third account. My total daily time checking e-mail has increased by 90 minutes daily. My Spam count has tripled.

I still haven’t got it all right so I’m frantically forwarding items from one account to another and frequently subscribing or unsubscribing with different addresses, which is a colossal pain. Assuming I’m open to communication from players I don’t already know or deal with in these sectors, how do they find me?

As a marketer, I’m troubled that we have not really devised ways to efficiently and effectively merge and purge e-mail addresses or link offline profiles to e-mail addresses. I am profoundly aware that premature claims by consultants, technology and software suppliers during the dot-com boom brought about the anger and action of privacy advocates who have all but closed off our chances for cracking these codes in service to commercial ends.

Ironically, so far the only people who seem able to either track me down efficiently or cover me via e-mail carpet-bombing are the porn purveyors, who in many ways have pioneered the most viable technology and marketing techniques on the Web. I’m routinely flattered and surprised by the growing number of people who either think I’m such a major stud that I need to see lots of naked people in countless positions and combinations or that I'm impotent and need a chemical solution ASAP.

So I’m faced with existential questions … how do I sort my messages, how do I present myself to the world (and simultaneously remember all those passwords and user IDs) and whom do I trust to house and potentially share my personal information?

There have been several attempts to create products or services to concentrate my online identities into an easy-to-use, easy-to-transmit access authentication scheme that could be used online or via wireless devices. In theory, by concentrating all my identities in one place, I could by-pass my faltering memory and securely access sites, programs, stores, applications and organizations of my choosing with one-click.

The cost, of course, would be giving the provider of this service, access to all my secrets. No doubt the government will sooner or later want to get into the act to assure themselves who I am and what (if any) is my relationship with Osama bin Laden. I’m not a privacy nut but this stuff scares me. I’m willing to endure more than a few error messages as I transpose user names and passwords rather than lay bare who I am and what I’m doing to any kind of commercial or governmental scrutiny.

I’m usually schizophrenic when I consider the costs and benefits of identity authentication and profiling. As a data-driven marketer, I’m generally amazed at both the math and the machinations of profiling, collaborative filtering and forward-looking modeling. As a bald, aging, white, liberal, male New Yorker, it is depressing to be reminded that I track with my demographic, that birds of a feather truly flock together, that age, education and income are much more predictive of behavior than we like to admit or that my viewpoint and needs aren’t as unique or distinctive as I tell myself they are.

An although I suffer from E-mail Split Personality Syndrome, at this point in time the cure is much worse than the symptoms. And so like millions of others, who are predictably like me, I am willing to endure a bit of confusion and discomfort to retain a measure of anonymity and the ability to elude marketers like myself.

Smart Surgical Search Engine Tactics

2005-02-24T15:01:00.000-05:00

A new study indicates that multi-word searches are more valuable in terms of clicks and, by inference, conversions than single word searches. This makes a lot of sense.

Consider a search for "socks" on Google, far and away the leading search engine. Assume that the more generic the search equals the least valuable prospect. Why? Because the least sophisticated buyer will default to the broadest possible search term. Also assume that the broader the term searched draws the biggest number of potential competitive key word buyers because the monkey-see-monkey-do marketer bids on the plain vanilla terms in a mistaken attempt to outwit or outspend the competition.

The generic term "socks" yields 12.6 million hits and is a term heavily bid upon. Add the word "cashmere" and hits drops to 240,000. By adding a second word you reduce the prospect universe dramatically; most likely getting closer to real buyers. The more specific the search becomes, the more likely you will be in closer contact with people who have a need, the cash and a true interest in buying. (This assumes that a more determined buyer is a more sophisticated search engine user; an anssumption that may not yet be true.) Add "mens" to the search criteria and the number of hits drops to 139,000 which can be further winnowed by specifying a color like green to reduce hits to 43,200.

Then zero in on location. Here you begin to understand the appeal of local search. By adding "NYC" the total hits shrink to 6160. Specify "Manhattan" and the list is down to 3910 and if you punch in a zipcode, Google displays just 5 nearby sellers.

Assuming you are selling men's green cashmere socks in the 10017 area ( e.g. Bloomingdales), the more words bought yields the tighest results and presumably the most immediately interested buyers. The real question then becomes will the cost of buying a 7 word phrase yield enough searches and enough buyers to cover your costs?

If you want to end up in the top 5 natural search results above the fold or high up in the paid results running across the top blue bar or along the right hand margin, the best SEO tactics are to buy strings of words that correlate to the most popular items you are selling. Ideally each string of words might be phrases that your customers actually use or combinations of words that reflect the criteria your customers use to select merchandise.

The tactics work for B2B searches where generic terms like "ERP" or "blade servers" yield zillions of search results and are presented to everyone from kids doing school reports and aging investors to CIOs and operating IT managers with budgets and buying authority. Again the operating assumption is ... the more generic the search term; the less valuable the impression.

To get faster access to more likely buyers, sophisticated marketers are talking to their customers and buying descriptions or phrases that reflect how prospects and customers talk about or describe problems, pain points and needs. They are also researching how generic terms are embedded in prospect thinking and buying phrases that reflect how truly qualified leads might think about the product.

For example rather than buy "ERP" or "SAP ERP software" a more sophisticated marketer might buy "ERP in the software stack" or "ERP integrated with customer relationship management."

These are phrases less likely to be bid up and more likely to be used by qualified prospects. In this way the smart guys reduce the number of bidding wars over the generic terms, carve out potentially ownable terms and get top rankings on searches conducted by those most likely to be researching their product or service.

The Real Objectives of Integrated Marketing

2005-02-22T15:34:00.000-05:00

Appear smart, with-it, organized and relevant by presenting one face and one voice to customers and prospects wherever and whenever they intersect or interact with the brand.

Engage customers and prospects comfortably and persuasively in ways, consistent with the brand identity and brand promise, which respects customer choices, preferences and privacy.

Sell more stuff faster to customers and prospects with the highest potential lifetime value and the greatest likelihood to be loyal, referring customers over time.

Make every penny of marketing spend work as hard as possible in every possible way by rigorously benchmarking and monitoring productivity, yield, duplication and ROI.

Reduce and rationalize internal silos by engineering a marketing system where internal resources compliment rather than compete with each other to present the brand as customer-centric, competitive and responsive to the marketplace.

Compass Points for Online Conversion

2005-02-22T15:32:00.000-05:00

As the web becomes a global emporium, it’s becoming obvious that we need to watch, understand and manipulate the commerce process closer to sell more stuff. At this point what we measure (clicks, page-views, impressions) doesn’t help figure out how to optimize conversion. It is time to focus on how to sell more, faster. The old saying “where you look is what you see” dictates the relevant metrics. It’s the sales…stupid!

One way to crack this code is to begin with baseline direct marketing principles.

1. Behavior is the best predictor.
2. Repeat behavior is a better predictor.
3. Prospects that look like current customers are likely to be better prospects.
4. Prospects that do what customers do are the best prospects
5. It’s easier and cheaper to sell more to current customers than to convert prospects into new customers.
6. None of this is as easy to do as it is to say.

Ten Secrets to Success in Advertising or Marketing

2005-02-22T15:29:00.000-05:00

1. Read everything. Don’t just scan it. Read it. Be sure you understand it. Ask questions. Keep asking. Question it. Good ideas come from everyone. Your perspective will help keep us from being too insular.

2. Demand context. You’ll be asked to do a million things. Many are routine or intuitive. Some not. If in doubt, ask what we are doing, why, to whom, and how your task fits into the whole scheme of things. Also insist on knowing about priorities – which matters/comes first, second, third.

3. Be a Hub. We will all be spinning in several directions. You are the hub of the wheel – steady, stable, constant, always in the same place. You’ll have to figure out how to do it.

4. Get involved. Surf the sites. Know our competitors. Read the paper with us and our clients in mind. Become an online shopper. Notice cool functionality, interesting details, marketing stuff and share it with the team.

5. Lay out your thinking. As you do more complex projects, don’t assume that everyone knows (or remembers) what you are doing. Lay out the assumptions and hypotheses. Document your approach so we know where you are coming from.

6. Treat everyone like a client. Assume that everyone deserves maximum attentiveness and respect. You’ll never go wrong.

7. Assume urgency. We move at Internet speed. And deliver service and answers in a New York minute (50 seconds). Assume that every request made is to be done ASAP unless otherwise stated. If too many ASAPs pile up, ask for help in setting priorities.

8. God is in the details. Every great thing is nothing more than a web of details. Write everything down. Check and double check. Spell check. We are all juggling stuff. We expect you to be on top of things – entirely buttoned up. If we don’t share the details – demand them from us.

9. Know where we are. Figure out our personalities. Get all our phone, pager, PDA and home numbers in an easily accessible form. Know how and when to reach us throughout the working day. Figure out what you need from us to be productive. and happy. Then tell us explicitly. Few of us read minds. All of us want to work in a fun, happy and productive place. Getting there is an individual and collective responsibility and goal.

10. Build a network. Every organization has a formal structure and table of organization that explains who’s who and what’s what. Every organization also has informal links of friendship and mutual cooperation between people. That really decides who’s who and what’s what. Getting into the informal loop and being a source of help and information to others will expedite your ability to get stuff done and accelerate your productivity and job satisfaction.

The Last Hope for Ad Agencies

2005-02-22T15:27:00.000-05:00

Ad agencies have always been at the mercy of client anxieties. And agencies have always been the whipping boys for all manner of brand or product performance issues. Everyone understands that agencies exist so they can be fired. Everyone also realizes that the core agency value proposition is either “we know or can do something you cannot” or “ we have arms and legs to get things done faster, better and/or cheaper than you can do it yourself.”

But in the last few years agencies have had even more tenuous relationships with their clients. The list of clients that broom agencies quickly seems to be growing. Skip Pile’s latest research indicates that clients change agencies, on average, every 2.5 years, twice as frequently as before. There are all kinds of reasons but the bottom line is that few clients believe that agencies are long-term partners.

You can’t be a partner if they don’t know you well. Rarely are agency chieftains, part of a client’s inner circle. It is unusual for agency heads to be considered the CEO’s or even the VP Marketing’s consigliore or to even have a voice in crafting client strategy. Instead agencies and their leaders have become receivers of strategic output and implementers of tactical plans.

Very few clients believe that their agencies actually know the fundamentals of their business, their category or the critical processes within their enterprise. Agency expertise is understood as generic, plain vanilla project management.

And even that role, too, has a built-in trap. Aggressive cost controls and benchmarking have given savvy clients unusual leverage. Many specify upfront the time, cost and staff to produce a postcard, a website, an e-mail campaign or a #10 mail package. Few are willing to pay for anything but minimal staffing. Even fewer are willing to pay for senior people who allegedly bring added value, insight or experience to their accounts.

Yet agencies, from the 2-person shops to the global conglomerates, seem to be impotent to affect the size, timing or sequence of client spending. Agencies are output. It is a sobering thought, which fundamentally changes the game.

Yet changing these circumstances requires changing the way agencies do business. Consider a few key areas.

Leadership. Clients hire agencies that have a point of view. If you don’t have a POV you are just another vendor cranking out pretty pictures or punchy copy. Unfortunately too many agencies either haven’t developed or articulated a distinguishing POV or are unwilling to expose their POVs for fear of rejection. In a corporate environment that is naturally risk averse, having a POV is a point of distinction, which must be leveraged to an agency’s benefit.

DM agencies especially have practical knowledge not only about a client’s strategy but generally understand the distribution channels, the media, contact centers, customer service, fulfillment, retail traffic patterns and nuts and bolts operational reality. Agencies are often in a position to traffic information, data and ideas among and between different business units and to infuse grand schemes with a healthy dose of reality.

Leadership requires agencies to get out ahead of their clients by thinking through and anticipating events, sketching out likely competitive scenarios and contingency plans, understanding the personalities and power dynamics within client organizations and presenting “crazy” ideas or trial balloons for client consideration.

Doing this requires proactive thinking and investment spending. It also requires that we train junior people how to do these things and use senior, seasoned people to get top-level access and to put this stuff across persuasively. Account people who take reasonable risks, get beyond the day-to-day and become trusted, memorable or effective on the basis of their personalities play a critical role in offering clients the leadership they crave.

Efficiency. Developing tools to train, manage, deploy and effectively use agency resources is critical to maintain margins and grow profitable businesses. In the wake of the Seifert conviction, it will be critical to answer skeptical clients questions about rates, billing and productivity. Though most agencies have adopted the professional services fee model, they haven’t used professional services norms to maximize the value, productivity and utilization of their people.

This is not a software problem. It is a matter of understanding who is working and what they can do and mapping these resources transparently against client needs in real time. Improved real-time resource planning in-tandem with clients is a necessity.

Agencies have not parsed work among or between teams to capitalize on expertise or economies of scale. Nor have they used time zone differences, cost differentials or global resources to move projects ahead faster or to squeeze out better margins. Force utilization tactics and productivity measures, beyond counting billable time, are virtually unknown in the ad business, even though other industries have used these techniques to great effect in reducing costs and cycle times while motivating their best people.

Alliances. Every agency has loads of alliances. They are usually touted in press releases. Yet few can actually capitalize on these relationships to the benefit of clients. And while they sound good in credentials presentations, far too many agencies can’t, don’t or won’t leverage these alliances because they cannot control the ally’s end product or they fear disintermediation.

These twin demons --- paranoia and the need for control – have undercut most agencies claims and seriously burned credibility in offering clients the ever elusive “integrated solution”. The ability to leverage resources within networks is still the exception rather than the rule and has led all but a few clients to reject the idea that they can get full service from any one holding company.

Clients believe that each agency has one or two core strengths. Nobody really believes that any given agency is tops in everything. Having, using and delivering credible, expert allies is critical to consolidating, maintaining or expanding any standing with the leading marketers and brands, especially at a time when they are working with skeletal staffs.

Being able to field a coordinated team of agencies who will uniformly understand client objectives and culture, work in a coordinated manner, deliver against integrated timetables and husband precious marketing dollars is the Holy Grail. Orchestrating alliances is the best chance for finding and delivering the Grail to our clients.

Leadership, efficiency and alliances are three areas directly controlled by agencies. They have traditionally influenced relationships with clients. Attacking consulting firms and whining about the economy isn’t the answer. Leveraging agency assets is the only hope.

Women Buy Everything: Work With Them

2005-02-21T14:34:00.000-05:00

For Confucius, “Women hold up half the sky.” For futurist Watts Wacker, women are the only factor in modern life as men become simply exotic house pets. For e-tailers, women are becoming dominant shoppers demanding different shopping environments and functionality.

Since the early part of the 20th century women have owned shopping as a practical activity, as a personal gratification and as a sport. Simultaneously a symbol of social liberation, an outlet for intellectual and financial expression and a convenient ghetto, shopping, according to Paco Underhill, is female. A study commissioned by Women.com, P&G and Harris Interactive confirmed this social reality when they found that women control 75 percent of family finances, and 80 percent of family purchase decisions.

Underhill, a retail consultant and self-proclaimed shopping anthropologist, believes that “Women can go into a kind of revelry when they shop. They become absorbed in the ritual of seeking and comparing, of imagining and envisioning merchandise in use.” And yet its not frivolous. “ Women generally care that they do well in even the smallest act of purchasing and take pride in their ability to select the perfect thing.” In my family and among my female friends, you can add the pride of getting the perfect thing at the perfect price, usually a discount measured in double digits.

So it shouldn’t be too much of a shock that as women close the online gender gap, they will become the preeminent online shoppers. This necessarily changes the game. Women shop differently than men. They are more discerning about merchandise. They do more advance research. They care about product care, laundering instructions, components and ingredients. They expect more convenience and service and care not a whit about the latest bells and whistles or the glory of evolving technology. Meeting this new, tougher set of expectations will be the deciding challenge of this holiday season for e-merchants, many of whom are still struggling to get basic functionalities working right.

Until recently women have been a steadily growing minority on the Net. Online savvy women have tended to be in their 30s or 40s and married. They’ve tracked with the upscale demographics of their male counterparts. The Boston Consulting Group reported that 42% of online women have been in cyberspace for three or more years and that slightly more than half have a year or less under their belts.

The early evidence of quick shopping adoption is scattered but compelling. In aggregate, twenty-one million women have bought something online. Those accessing the net from home have bought twice as much as those logging on at work.

If the newbies follow the patterns set by their cybersisters, site rankings and site functionality are in for big changes. One obvious reason is that women shop both for themselves and for others. Single women drive gift businesses. And married women serve as the health-care decision maker in virtually every household, buy food, HBA and cleaning products, acquire goods and services to furnish, decorate or maintain the house and household routines and buy for kids or aging parents. (When you consider this list, you realize that men basically buy their own toys and occasionally cover their pets.)

Goodbye Surfer Girl

What is surprising is that women’s’ shopping style changes online. According to Underhill, “ men and women switch sides when shopping on the Web: Men spend lots of time surfing from site to site while women go directly to their destination, click only enough to buy what they want then log off.” Its pretty much the same act as the remote control. He flips. She sticks. The reason, he opines, is that “women turn technology into appliances. Women see its purpose—its reason, what it can do” as the primary value. They care much less about the intrinsic qualities of the technology.

Data from BizRate.com confirms that women are “seekers” rather than surfers exhibiting the traditional male surgical shopping approach. Women make half as many purchases as men and spend only one-third as much time doing it. Women tend to visit fewer sites for shorter periods of time. However they tend to have longer online sessions than men and seem to be more loyal to the sites they elect to visit or buy from.

Addressing the needs of female online shoppers requires close attention to the following tactics:

KISS. Keep it simple. Manage the K size of images. Avoid downloads or plug-ins if you can. Don’t get carried way with Frames, Flash or other tools. Focus on getting her there quickly and establishing your positioning. She wants to get in and get out efficiently. Facilitate that for her.

Show Her the Beef. Your female visitor is there to shop. For her, this is serious business. She wants to see what you have and what it costs. Streamline editorial. Make photos and images big. Use zoom technology to show off details. Make type big enough to be seen without her glasses and in colors or fonts that will get instant recognition and understanding. Arrange merchandise sequences logically and use adjacencies for cross-selling or up-selling.

Aim For One-Click Navigation. Try to put your goods or services within one click of purchase. Work towards an intuitive site navigation. Make it easy for her to ask questions and contact customer service. Put your returns policy in a prominent place. Use “breadcrumbs” so she can retrace her steps easily.

Recognize Her. The more personal you can be, using opt-in techniques, the better her experience. Don’t bury your privacy policy. If you can dynamically serve her pages based on her shopping patterns, so much the better. Remember that the volume of merchandise sold is directly correlated to the time spent on your site. Using personalization techniques or offering live-chat assistance will increase the length of her session and the value of her shopping cart.

Plan for Group Activity. If you’ve ever been in a store, you know that two women shopping together can become a buying machine in record time. Offer your female shoppers opportunities to share the shopping experience. Chat rooms, the ability to e-mail products to friends, a wish list or gift registry, a personal shopper, group shopping or group discounts, the use of Instant Messenger to facilitate virtual shopping trips among girlfriends will pay off in increased sales and loyalty.

The Real Point of CRM

2005-02-21T14:24:00.000-05:00

I have more relationships that I can handle. I do a so-so job, managing up, down and sideways at the office. I do a little better with my gorgeous wife, great kid and lovelorn dog. I am on solid ground with my assistant who typed this column. I do a little worse with my aging mother and
doting in-laws and much worse with my annoying landlord and contentious ex-wife.

Then I struggle to manage relationships with dog-walkers, babysitters, doormen, dry cleaners, piano teachers, soccer coaches, tech guys, chorus masters, postmen, next door neighbors, visiting cousins, finance guys, college pals and professional peers. I am maxxed out.

I really don’t have room for relationships with my fabric softener, my shoes, my dishwasher, my news agent, HBO, The Mets, each of the 65 magazines I regularly read, my Palm Pilot, my cell phone provider, AOL, my toothpaste or my TV set. And even if I did, I am not sure I’d do any better relating to them.

I guess I should be thrilled that hundreds of corporations have decided to take this burden off my shoulders by investing in CRM programs. I am flattered. From multimillion-dollar software installations to guys with 3 x 5 cards, somebody out there is trying to keep up, keep track and keep selling me.

The problem is I’m an odd duck. So are most people. We don’t really do what we say. We can be distracted and rerouted by deals and offers. We change our minds easily and frequently. We take advice from unqualified strangers at cocktail parties. We can be sidetracked by slick design.
And for large categories of goods and services we either don’t care or we do care very much but we don’t show it. Marketers spend too much time buying increasingly complex “M” solutions and not enough time understanding “Cs”. The greatest enemy of CRM is unmet expectations. Gartner projects that 55% of CRM efforts in telecom will fail to demonstrate a positive ROI. All
that time, energy and money without any movement along the relationship continuum and no positive cash flow to show for it.

When all the bells and whistles are stripped away, CRM rests on three fundamental direct marketing principles. All that time, money and energy is spent trying to capitalize on these truths which drive every direct marketer.

1. Birds of a Feather Flock Together. If you can find the demographic/psychographic patterns that define your most valuable or most frequent customers – you can better serve them and find more of them easily.

2. RFM Matters. If somebody takes an action, it’s easier to get them to do it again. The sooner the better. And if you watch how much they spend you’ll get a feel for how much they could be worth to you as a customer. That’s why cataloguers put offers in your shipping bag and send you a new catalogue as soon as you buy. Its all about recency, frequency and monetary
value.

3. 80/20 Rules. 20% of your customers yield 80% of your volume. Ideally if you can identify the 20%, you can communicate with them much more cheaply and thereby maintain volume while increasing margin. This fantasy of finding the 20% explains why packaged goods marketers keep trying to do CRM in spite of successive failures, total lack of understanding and
products that usually sell for less than five bucks.

Getting all the data entered correctly, kept current and aggregating personal info, buying stats, appended data, model scores and the results of email campaigns, coupon redemption or store visits could keep teams of programmers, analysts, coders and marketing research types busy for years. Imagine the costs and the time required, especially if you have legacy ERP systems, scanner data and warring business units with private stashes of numbers.

After all this, when a marketer gets it right it’s a beautiful thing. When they blow it, it’s a colossal waste of money. To help raise your consciousness about the room for relationships in consumer’s lives and the need to watch and respond, allow me to site a few examples from my relationship-rich life. They are not statistically significant or projectible. But I have a hunch they reflect the state of the CRM art. . . the good, the bad, the over-engineered and the unfocussed.

Norm Thompson
Fifteen years ago I saw an ad in The Wall Street Journal that read “I make the world’s most comfortable socks. If you doubt me, send me your card and I’ll send you a free pair”. Being younger, poorer and much more gullible (I thought there was a real guy named Norm in Oregon). I did it. So did ‘Norm’. His wick-dry socks are ‘the best’. ‘Norm’ sends me his catalogue, which I generally ignore. But he also sends me a flyer about my socks twice a year. And like a lab rat, my reflex instinct is to buy 3 pairs for $19 twice each year. Do the math. For the wholesale cost of a pair of socks and thirty 50 cent mailers ($15 over 15 years), Norm has built me into an annuity with a present lifetime value of $570 and a future value worth at least $38/year. It’s an ROI you or I would kill for.

American Airlines
I am a mile whore. But American seems to know when and where I fly even though they’ve never asked me a ton of nosey questions. They post my new points quickly and offer me deals on the routes I fly. They upgrade me much faster than their competitors and generally make me feel like a big shot. On most flights I get automatic upgrades often presented with handshakes from smiling gate agents. I’ve repaid their largess with frequent use, several incremental vacation package purchases, light mileage redemption and positive word-of-mouth. When I compare AA with Continental, Northwest, US Airways and United, who also are relating to me, AA seems more nimble, able to act faster and working much harder at our relationship.

Amazon.com
The home of the original collaborative filter bedevils me. I purchase a ton of booksusing that magical, demonic ‘1 click buy’ feature. Yet they aren’t very grateful. They never write or call. When I actually took a cross-sell offer on a CD player and CDs, I wasn’t acknowledged or thanked. Even the stodgy old BOMC celebrates a change in my behavior! I ignored their mail and FSI catalogues. I tossed the postcards pushing DVDs and white goods. I think I mean more to them than I really do. I haven’t felt this way in a relationship since seventh grade.

Brooks Brothers
I have worn Brooks Brothers Oxford cloth buttoned-down shirts since I was eleven. I used to buy them with money from my paper route since they were too pricey for my Mom. Since they’ve gone cyber, I have benefited from some great discounts. But, I can’t tell if they’ve
sorted me into a “value buyer” category or if its just a coincidence that I seem to only get discount catalogues and discount HTML emails often in quick succession. I know they’ve tuned up the fashion collection. But I can’t decide if they’ve become a discounter or if it’s just a characteristic of our unique relationship? I’m trying to decide if our relationship is governed by a sophisticated profiling effort linked to an ingenious contact strategy or whether Brooks is desperate to move the goods at lower margins. The fact that they’ve never zero-ed in on what I buy, referred to my purchase history or offered me a logical cross-sell suggests that latter.

Hertz
I’ve been a Gold Card holder for ten years. I still get a kick seeing my name on those digital boards and by passing the counter filled with tourists and losers. Immediately getting in the car and driving away makes me feel important and very savvy. But what’s up with their points
deal? They offer me all kinds of irrelevant coupons. If they’d look at my transaction history and my address, they’d know how lame the offers are! Is it still a relationship, when one side no longer pays attention?

Danube
David Bouley has been the “chef of the moment” in New York for 20 years, Danube is a shrine for foodies and gourmands. David keeps the checks of his 400 most frequent diners in a shoe box under the bar. His captains note wine choices and tips given. Each time you come in, they check the box so that the free ‘chef’s taste’ you get isn’t the same as last time. In my case, they remember how much I’ve come to love beef cheeks. So they bring me a free portion without asking. The box also cues the Headwaiter which drinks, wines and desserts you’ve tried, so the waiters know what to suggest and how to up-sell you. The technology is vintage 18th Century. The feeling of being pampered by one of the world’s great chefs is sublime.

Ultimately CRM is about paying attention. Technology facilitates collecting and analyzing data about your customers. But the game is won or lost in using the data at the right time with the right customers. Ideally CRM is like a friendship. With each exchange and each interaction the
parties learn more about each other. Each gently adjusts for the next encounter and generally feels good about the whole thing.

The Coming Global Vendor Battle

2005-02-21T14:23:00.000-05:00

The evolutionary battle for direct and interactive marketing is shaping up quietly as marketing services companies flesh out their portfolios in anticipation of eating DM agencies’ lunch. Not everyone sees the coming clash. But leading clients are open to alternatives, because they experience the agency model as severely broken.

The antagonists address the problem of creating integrated marketing programs from two different and distinct perspectives. Agencies have been selling insight-driven creative, media planning and buying and project management at high margin retainers exclusively to one firm in each category since the late 60s. An agency’s assets are its talent and its bench strength. They sell big ideas.

Marketing services firms own hard assets; principally compiled lists, software or printing facilities. They aggressively sell to many or most players in each category and have acquired allied and ancillary services, usually at the behest of clients, which are competitively priced, often on a commodity basis. They sell infrastructure and discrete products.

If you are handicapping the title bout it will be Wunderman, OgilvyOne, Draft, MRM Worldwide, Digitas, Euro RSCG 4 and what’s left of Rapp Collins versus Harte-Hanks, Acxiom, Experian, Donnelly and D&B competing on a global stage. The focus will be on the high tech, financial services, travel and hospitality, automotive and retail industries.

Clients, starved by years of flat budgets and hiring freezes, need external marketing resources that understand their business, move quickly and can deploy nuts-and-bolts services on an as-needed basis at competitive costs. Clients want results measured in terms of demand generation, cross-sell, upsell and in increments of awareness or loyalty. They want to count on having a single butt to kick; a partner with skin in the game who is always on-call, doesn’t make excuses and offers predictable pricing.

The marketing services crowd has no creative pretensions and few claims about strategic insight into industries. They are agile and can execute quickly. They produce effective lists, do merge/purge, design and execute online and offline campaigns (including landing pages, sophisticated lettershop work and print on-demand), build, host and operate websites, handle sophisticated teleservices and teleweb interfaces, collect, track, monitor and analyze customer and prospect data, do search engine marketing, produce and distribute collateral and handle POS messaging and promotions.

Most claim they can present a single point of access, control, billing and operational responsibility to clients. The marketing services value proposition is “we will do it for you faster, cheaper and with less ado than agencies but with the same or better quality, coordination, command and control.” The next logical step, they argue, will be to outsource all marketing processes and retain only a few marketing strategists and leaders within a client organization.

Agencies, boasting brand names and faded glory, claim to offer superior service, industry specific expertise and insight and value-added project management spanning the globe. In fact, many of the components of agency service (e.g. lists, teleservices, CRM, lettershop, print or video production) are bought from marketing services firms. The value add from agency management of ed these services varies widely in quantity and quality.

To better track the coming battle, assess agencies and marketing services firms from the perspective of client “must-haves”.

Integration and Coordination. During the last fifteen years, agencies have created separate profit centers to offer media, production, interactive and consulting services. These units are charged with making profits independently. As a result they buy and sell services within the agency rubric which complicates relationships with clients, reduces easy integration and coordination and often adds to the bill. The quality of service and the tenor of the relationship rest on the skills of account management.

In marketing services firms, each component sells separately. Relationships are based on successful past sales and the perception of the value and quality of component products.
They are just beginning to create client-centric menus of services with pricing incentives to buy combinations or packages of services. They are new at responding to the need for integrated services and in some cases don’t yet see themselves in this arena. They do not have a cadre of seasoned account managers that see the forest for the trees.

Industry Expertise. With few chiefs and many, often under-trained Indians plus significant turnover, claims of deep industry expertise are hard to sustain. Agencies know how to create stuff and manage their own internal production processes, but hardcore understanding of markets and product niches is often hard to come by. Knowledge management in agencies is in its infancy. Given client exclusivity, agencies often cannot or will not share what they really know among or between clients. This is ironic since clients often choose an agency on the basis of its track record for a particular allied or competitive client.

Marketing services people tend to know their product. They are list mavens, printing whizzes and call center jockeys. Sometimes they also know allied products in their company portfolio. Most aren’t yet thinking in terms of broadband client service or client throughput. But recent acquisitions and management moves make clear that these firms are headed in that direction. Some have put coordinating structures in place to better package and price their offerings. There is little or no effort made at knowledge management.

Global Reach. Agency global networks, especially in the DM space, are a mixed bag. Central control and coordination is difficult. Time zones, wide variations in talent, different business practices and expectations and a variety of ownership models complicate the process. Many clients end up funding what should be an agency’s internal wiring.

Marketing services firms have regional hot spots and regional expertise but cannot yet present a consistent package of global services to clients. At this point in their development they probably don’t see enough potential demand to justify the internal plumbing or new acquisitions necessary.

The forces affecting the next generation of direct and interactive marketing are working their way into place. Today, neither DM agencies nor marketing services firms can provide clients with the full menu of services they currently demand. But sometime soon a leading major client will defect and the battle will be joined. Stay Tuned.

Taming Marketing Processes

2005-02-21T14:22:00.000-05:00

Business Process Management (BPM), the effort to identify, document, quantify and replicate best practices is coming to marketing. CEOs and CFOs want to know what’s behind the curtain, how much it costs, how much it yields and how much faster and cheaper it can be done. .

Dubbed Marketing Process Management (MPM) or Enterprise Marketing Management (EMM) the movement is much more than buzzwords. It is rooted in material changes and significant savings in time, efficiency and cash gained from process re-engineering in finance, accounting, manufacturing, logistics and supply chain. It’s marketing’s turn.

This business movement, championed by a bevy of opinion leaders, CEO authors and the usual B-school pundits, is based on the premise that every successful business is an aggregation of discrete processes. If you get the processes right and can find efficiencies in aligning simultaneous or sequential processes, you win the game.

The assumption is that marketing, long considered a black hole for budget dollars, can be similarly tightened up. Below is a guide to the topics likely to come under scrutiny as the first wave of BPM sweeps across the land and sets expectations for senior leaders.

Targeting. On a basic level there is a finite, definable universe of buyers, influencers, advisers and spoilers for every b2b product and service. On a sophisticated level, systems should track individuals by industry, segment, product use, title and role in a selling process mapped over time or deal cycles. Yet very few organizations have reliable processes in place to manage target lists and databases. Instead the squeaky wheel gets the grease when there is an obvious or embarrassing mistake or when the pipeline dries up.

And even though names and titles turnover as much as 40% each year, marketers ought to be able to continuously run data collection and cleaning programs to insure they know who to sell to. Ideally these systems incorporate information from sales reps, partners, customer service and online channels and are scrubbed regularly by telemarketers and online updates.

There is a constant anxiety about the quality of target lists and the relevance of the names on these lists when mapped against product or deal cycles. And yet very few companies have put standardized processes in place to manage this on-going need. Data cleansing and updating can be a program that runs quietly in the background of every marketing organization consuming a steady, constant percent of the budget it.

Organizational Alignment. It’s still not uncommon for sales and marketing to have different agendas, timelines, targets, program preferences and budget priorities. Part of this ambivalence is institutional, cultural and personality driven. But there is no real excuse for a corporation’s horses to be pulling in different directions.

Even the most Machiavellian CEO has figured out that competition and conflict between sales and marketing yields nothing more than wasted time and resources. Yet few have used their authority to compel a single view of the marketplace or to impose an integrated approach to applying the right amount of resource in the right sequence to yield the most profitable revenue in the shortest time.

The lessons of process engineering will soon be applied to this perennial problem in ways that will force chief marketers to become much more involved in sales processes, pricing and productivity issues. Similarly the process perspective will benchmark the ROI of favorite sales tactics like golf outings, trade shows, giveaways and travel boondoggles to force sales teams to demonstrate their throughput power.

Demand Generation. The desperate search for qualified leads that turn into bona fide sales opportunities is and always has been a game of numbers. There are a finite number of ways in which individuals are contacted, messaged, incented and engaged. A universal standard for defining lead qualification exists, though it is expressed in a million ways.

“Best practices” can be identified, quantified, replicated and probably automated. The emphasis shifts from creative, where the next campaign or package is expected to crack open the sky, to a mining and refining model where getting to the right person with the right frequency at the right time rings the bell.

eNurturing. In every industry and for every product there are prospects who are interested but not yet ready to buy. Hardly anyone has found a formula to keep these leads ”warm” efficiently and for nurturing their interest into deals that can be harvested when ripe.

Managing C or D leads should be an automated process driven by assumptions about when to mail, when to ping with an e-mail newsletter, when to invite to events and when to contact live by phone or in-person. A series of well-timed contacts, using pre-defined messages can be orchestrated at discrete stages of a purchase cycle by using technology to nurture future deals for maximum return on minimal investment.

CRM. Tracking customer information and behavior ought to yield competitive advantage, facilitate up-sell and cross-sell and build stronger customer loyalty. Ideally these systems ought to give senior management visibility into what is happening day-by-day in ways that will improve the speed and quality of decision-making.

Huge sums have been spent. Nailing down the real use and value of CRM investments, especially sunk investments in evolving technology, is high on most leadership agendas. An obvious payoff should be better reporting and insightful analysis from the data collected. As a result management “dashboards” featuring daily or weekly graphic displays of critical marketing variables will become as popular as Blueberries.