Archive for category Marketing
Understanding modern buyer flow
Posted by admin in Business, Improvement, Marketing on October 27, 2011
Every morning when I wake up I immediately turn over and look at my phone for any emails that came in over the night. Without fail I typically have 5-6 emails from various brands and companies who send me an “eblast” that is time stamped at 12:00 a.m.. So naturally I jump out of bed, throw on some shoes, and run to the mall to take advantage of the sale right? Wrong. The basic problem here is something that has become rampant across digital marketing and ecommerce. Companies have began to completely ignore buyer flow.
In the old days when consumer’s main interaction with purchase decision making came inside the actual store marketers got it. Companies spend (and still do) millions of dollars studying buyer flow in a super market or retail store. Marketers analyzed where on shelves the average consumer looked first, some areas have more prestige than others for example and make a customer feel like the product is of higher quality. They analyzed what flow customers purchased, so the cereal for example is typically placed at the front right of a store and milk in the back left because we knew that customers would purchase milk after cereal, not the other way around, and that is the movement of a typical consumer (front to back, right to left).
In retail and clothing shopping this was also true. Say you run a clothing store in a mall. You place items that typically garner attention toward the front where it is visible from the outside to draw people into the store. Once there you place low selling items between two groups of high selling in order to stimulate sales from people moving between the two product groups.
Mass marketing understood this buyer flow as well. Most high value shopping was done on the weekends. As a result markets would load the Sunday paper up with retail ads, most of them highlighting high value products in an effort to draw consumers into the store. During the week when budget shopping took place (groceries for example) marketers would send out coupons and sales with the desire to attract their spending.
Now, back to my eblast example. Something is lost here. Instead of trying to influence buying decision making moments marketers are just throwing out information to check it off their list. They ignore the flow of the modern consumer. The best time to reach a consumer is when they are about to enter a decision making scenario. Additionally, now you have to understand what device they will be receiving information at when they are into that buying flow and format it for that usage.
For example, recently I met with a large clothing retailer. Most of their purchasing still comes through a physical store rather than online. Most of their online sales are repeat items such as shirts with the same shirt size, underwear, socks, and other items like that. Why is this? Because people want to know that the item fits before they order it online to not deal with the hassle of returns. The decision making happens inside the store for the majority of consumers.
By trying to influence the decision through a midnight email (which thankfully they do not do) they would miss that influential moment. Why? Because the stores do not open until 10, by the time the person read the email in the morning until the time the store opened the influence has passed. Secondly if they did make a decision to purchase online we know that retail type online purchasing is typically done in early afternoon or, increasingly, during the prime time hours (7-10 p.m.).
In this example in order to play on buyer flow the retailer should look for ways to transfer in store buying to online buying through smart phones, because that is the device they have on them when in a store. Also we know that tablet browsing tends to spike as well during the prime time areas, so build a tablet friendly site and work on ways to drive people to that site during that time frame.
Anything marketing outside of the buyer flow decreases ROI and brand identity. The good part for marketers is that data in digital is highly reliable and very easily available. Study your analytics. Set up custom reporting to understand when people are making purchases and how they arrive at that decision. Analyze your email campaigns, don’t just look for open rates, look at click rates and then bring those into the flow of your site analytics to find out when and if those campaigns translate to purchases. Don’t be afraid to play with timing through A/B split campaigns to see what works best for an audience.
Above all learn about your customer. If a customer feels like you understand them then they are more likely to buy from you. Working into a buyer flow is as much about relationship marketing as it is about influencing buying. When I receive an email at midnight I know that the company does not understand me. When I receive one near a decision making point my relationship with the brand becomes positive.
How relationship based marketing works
I have talked many times here about my relationship based marketing approach. Somehow my career has always consisted of B2B marketing. In this world relationships matter a lot. Not that they don’t matter in consumer marketing, but with a target audience of 4,000 versus a target audience of 4 million I can build relationships in ways that consumers marketers can’t.
To understand how relationship marketing works in the business world, imagine you are a business owner and you need to hire a person. You can on one hand take open bids (resumes) for the position, sort through the top few which give you the best proposal on paper, spend an hour with each, and then make your decision.
Now throw someone into the mix that you have a previous non-working relationship with. You are familiar with their work because you have spent time with them. You might have a few employees who know this person and provide validation to their work. Your company might work with someone who they have also done business with that can provide an unsolicited recommendation.
Each of these are relationship points for this person. They present a stronger case for hiring than someone who you have no relationship points with. When it comes time to make a hire, yes you may be required to look at the others, but the weight of the relationship often holds true.
The same is the case in business. Let’s say you have a project to bid out. You have to take a certain number of RFPs because that is policy. One of the companies you choose you have a non-working relationship with. You know their work because you talk about it over drinks. Some of your other friends in the business have used them. You have seen work they have done with an organization you partner with from time to time. When price points are close to equal, as they often are, relationship wins 9 times out of 10.
As a marketer you have to find ways to create these relationship points without trying to sell them anything. Become involved with groups of your targeted audience. Become familiar with which of their associates you have done business with in the past and leverage those connections. Increase relationship points in every single way without going for the kill. Classic marketers talk about having 2-3 touches before a sale. Find 20-30 touch points before the sale, and all of them relationship based.
This increases the marketing cycle a lot, believe me. What you will find though that while your cycle is long, you tend to pull more people into cycle. Each relationship point development might in turn be a relationship point for 3 other potential clients. Additionally as you build relationships you increase the chance of repeat sales and up sales.
In the mix of all of this is social networking. My two personal favorites are twitter and linkedin are great for relationship building. Twitter allows me to keep in touch with what is actually going on in the lives of people I have on a target list. Linkedin is good for establishing those secondary relationship points. You can find who your target works with, where they have been, and people who recommend them.
Can you mix traditional marketing with relationship marketing? Absolutely. But more on that another day.
Why relationships matter most in marketing
For a couple of years now I’ve been promoting what I call relational marketing. If you have never read this blog, essentially I take the approach of building and maintaining positive personal relationships with customers in non-direct sales type of way. I always value the relationship over the sale and I believe out of that approach you can generate more sales over time. The catch is, you must authentically care about the customer, not just pay lip service.
Over these couple of years I’ve pitched this idea in everything from job interviews to consulting gigs. A handful of people got it, most were indifferent and several outright mocked me. The few that got the idea have shown me examples over and over of how a company can succeed. The ones who mocked me are struggling to stay in business right now. Neither of these scenarios has anything to do with me personally I might add.
A couple of months ago I stumbled across @garyvee’s new book The Thank You Economy. The summary sounded good so I downloaded a snippet of the first chapter. It was right in line with what I have been trying to preach. I immediately preordered the book. I am about halfway through it and I have found confirmation to some ideas and clarity to others. I firmly believe this is the future of marketing.
At SXSW this week I had the chance to hear Gary speak and expand on some of his ideas. At dinner that night we happened across a get together by an interesting new company called Happy Cog. They were giving away copies of The Thank You Economy. I took one with every intention of giving it away. I thought about doing one of those book giveaway contest on this blog, but I struggled with that idea because I don’t think it fits the theme of this book.
About a year and a half ago I met @pstrack. He asked me to go to lunch with him to hear about what I do. I spend a minor amount of money on print every year. I am essentially a small fish in a small pond. Despite that Paul invited me out to his print shop for a tour. When I arrived Paul had a small board set up that said “Welcome Greg Henderson”. It made me feel like I was the most important thing in his day.
Over the past year Paul has never tried to sell me print, I give him my business because I feel like he cares. In this time he has not only gained my business but that of many others. He does this because he makes every customer feel like his interaction with them is the most important part of his day. As a result his business has grown, and he has become a good friend. If he sends me something I listen not because it is a slick email or postcard but because I know he wouldn’t send it to me if it didn’t matter.
I am giving him the copy of the book because I think he embodies this approach. He gets it. It is my way of saying thank you to him. I am giving him the book though with his promise that he will find someone else who shares this same vision that relationships matter and pass the book along to them. My hope is that this will keep going. If the book gets too worn to pass on either buy a new one or let me know and I will buy a new one for you.
Bottom line: Relationships matter. People matter. Don’t create a marketing campaign, create genuine relationship with people. Tell them you appreciate them and mean it. Once the relationship is there the business will be there.
Does social media make us more connected?
Posted by admin in Communication, Marketing, Social Media on March 4, 2011
6 degrees of separation theory
If you ever read this blog you know that I am a bit fascinated with a phenomenon known as Dunbar’s number, developed by Robin Dunbar. Again, for about the 20th time here, Dunbar’s number represents the maximum number of personal connections that one single person can hold at any given time, which is 150. That number has been tested over and over again since the 1990s and seems to hold true.
I am in the middle of finishing a graduate degree in communication as you may know. Initially I took on a project studying the use of social media in delivering health messages to Hispanic populations. This project has been continuously delayed and it opened up an opportunity to study other things while waiting on this project. I decided to return my fascination to Dunbar’s number.
My basic hypothesis is that either Dunbar’s number actually increases when all social communication is used together, or more people reach this number easier and have a wider spread that previously.
It should be important to note that Robin Dunbar himself did a studying on the same idea last year. He focused solely on facebook and finds that the 150 number still holds true. Dunbar theorizes that it has more to do with the size of our neocortex (part of your brain that manages thought) than the ability to connect with that many people.
Why does it matter how many connections we can hold? The rate at which a product or idea is adopted by a critical percentage of a population (diffusion) has been increasing steadily alongside technology and mobility. Innovations such as the telephone, radio, television and the computer/internet have caused bumps in the rate of diffusion. However products and ideas have begun diffusing almost instantly over the past couple of years while physical technology has held basically constant. I believe this is a result of increased connection among people through social networking.
As a marketer and communicator this impacts everything. I think this has huge implications on understanding the overall value of social media. I believe it leads to products and ideas diffusing (or failing) more quickly. It causes more rapid response time, revolutionary changes to marketing strategies and an increased demand for exceptional customer service as part of a marketing technique.
Dunbar’s follow up study focused just on Facebook, which is much more of a passive networking tool due to the way timelines are managed. This I believe is the reason Dunbar was not able to see any changes. If however there truly are no changes I believe people reach the 150 number more easily. This is important because it expands the overall total reach of a community or population group. This allows ideas to spread more rapidly because more people are highly connected.
I will continue to share my research as it progresses on this topic. I plan on reaching out to Dr. Dunbar at some point along the way to try for some collaborative research. Please let me know if you have any specifics or ideas that you would like to see incorporated.
My Personal Strategy: Relational Marketing
Recently I was asked to describe my marketing philosophy and strategy. I decided instead of only responding to that person I would share here as well.
I have spent the past 10 years of my life as a marketer. In this time I have promoted tourism, fortune 500 companies, government both state and national, non-profit organizations and foreign companies. Some would say I am well rounded, others think I am fragmented. Regardless of your personal opinion of me, in order to work with that wide of a range you must develop an overarching theoretical base and then find ways to apply that to changing situations in order to be successful.
I have discovered that any marketer who comes out saying they have created a magic solution to address all situations is probably lying to you, for starters those guys would already be C level for a top 5 company if they did. So please do not think I am that person. Rather I think good marketer pulls together a mixture of observation, existing theoretical research and a healthy dose of common sense to build their own personal philosophy.
Relational Marketing
I believe in what I like to call relational marketing. I believe that, in a marketing saturated world, customers want a company who focuses more on them than selling the product. As a result my approach is building and maintaining positive relationships with customers. This takes time and effort but organically sales will flow out of this type of strategy and dramatically increase the likelihood for repeat customers, which is honestly the holy grail of sales. This has continued to grow as I have studied relational communication at a graduate level, which has had a profound impact on my philosophy.
Making it work
With this as a base, applying this philosophy across various marketing situations is highly possible. You begin with identifying a core, influential audience and what medium is best to maintain a two-way dialogue. You encourage communication that is both informative and engaging for both sides. You want to learn from your customers about their needs, desires, and complaints and you try to acknowledge and incorporate those messages back to them in your response. Notice in this the listening comes first. Yes you must reach out to encourage communication, but you always listen before taking action.
The main complication is finding the correct communication medium. For small audiences this is fairly easy, you can engage efficiently in one-to-one communication. This worked great for me in state and non-profit marketing, the target audience of influencers is few and receptive to communication. Not so much with others.
The social aspect
On a larger level however things get a bit more complicated, you have to manage potentially thousands of customers. This is where a social marketing strategy comes in. By this I do not always mean Twitter, Facebook and similar mediums. The strategy must fit the customer base, if that is Twitter then by all means use Twitter, but you must find a way to interact with customers as close to where they are as possible.
A case study
Previously I worked for a company who served as the link between a major satellite company and their local installers and service people. Through this link we provided installation supplies, installation guides, and marketing material to generate local sales. Our core influential audience was the local installation company owners, with the installers themselves and the customers of the satellite company as secondary audiences.
When I came on board our company mailed out 4 times a year a catalogue of installation parts. To order those parts or obtain installation material they had to call back into our company and place their request. Similarly when they were running local marketing campaigns they needed to call a different department, put in the request, and then call again to report the results of the campaigns so that they could be relayed back to the satellite companies marketing division. As you can imagine this whole process was extremely expensive, uncontrolled, and ineffective. The workers were over worked trying to manage it all and the customers felt no love because workers were measured on how quickly they could handle a call and move on to the next.
Doing what I was hired to do
I was brought on to develop a strategy for customers to handle all of this from one single source. The customers had to order parts, request material and managed ads. In the company’s mind if I could create this it would solve all the problems. The company was seeing a steady decline in customers over the previous 4 years. I went to work developing a two-part approach to solving the problem. I created a portal system that would allow customers to access the materials without having to request and manage, track and report all advertising. Tied in with that using a universal login was an ecommerce system that users could order and also pull installation material from the portal if needed.
In no time the vast majority of customers willingly switched to the new easier to use system. However I saw something alarming, the rate at which the company was losing customers remained rose even more. It was this relationship aspect that was missing. After some research the customers were not engaged in social media, did not respond well to email, or any other traditional interaction method. I pulled in the director of customer service and begin to devise an interaction strategy to meet the customers where they were. We had created this platform that funneled them all into one centralized place, why not use that to build relationships with the customers.
Fixing the problem
I went back and built in interaction points throughout the process encouraging feedback, questions or suggestions. Incredibly customers began using these tools. After a few months we started seeing the rate that customers were leaving begin to level off and eventually disappear. Even more important we started seeing sales creep up, even in the middle of the largest recession of my lifetime. Customers became happier and began using us for all of their supplies. Then they began telling others in the industry.
The point
This is just one example of how this type of strategy works. There is no magic bullet, sorry to tell you. By taking a core principle such as building positive relationships however and finding ways to apply it to a situation you can be successful. This requires buy in from all levels of an organization however. Just as I can tell this positive story I can tell another story of trying to do this without the rest of the organization buying in and it failed miserably. The company saw profits fall 200% from the year before I started the strategy. Customers on one level felt cared for and on the other felt ignored and in frustration gave up and went somewhere else.
The point is that your customers will care about you only as much as you care about them. This is a constant ongoing action that you must work at each and every day. If not you come across as greedy and sleazy, which if that happens you need to talk to me about image restoration. Love your customers every day and they will love you back. That is your magic marketing bullet.
What we create when we communicate
Posted by admin in Communication, Improvement, Marketing on October 26, 2010
Sorry for the long delay. This is the second in the communicating better series. Last time I looked at ethics in communications. As always feel free to drop comments here, on twitter or verbally and I can assure you it will impact future discussions.
The old days
Remember walkie-talkies? We thought they were the coolest thing as kids. This was before cell phones hit critical mass and every kid older than 7 had one. Later in life as a camp counselor (poor kids) we used them to communicate around the camp. With walkie-talkies you pressed the button, said what you had to say and waited for a response. This was a transition based communication.
This is how we use to view communication. I sent a message, you received it and then you sent back your response. The focus in this model quickly becomes on how I craft the message I push out. My hope was that you would interpret the message with the same meaning that I intended and vice versa. Sadly this is how most of us still function with our business messages. We send a press release, ad, put up a website or say something on social media, and then we sit back and hope it is interpreted the way we intended. Ineffective, hopeless
Tag, you are It
The major problem with this type of communication is that we start viewing customers as “It”. We push out an email campaign and monitor the open and click through rates and use that as a measure of success. We monitor ad impression rates and try to find correlation between impression and sales. We count our twitter followers, our newsletter subscribers and the circulation numbers on our press releases.
Repeat after me: Customers are not a metric
We have to move beyond viewing customers as it. @Bryanjones wrote a great post looking at social engagement in which he references Martin Buber (who I am a fan of). Buber talks about the need to move from an I-it relationship to an I-thou. Essentially by doing this you are viewing people not as metrics, but as people. Isn’t that what they should always have been?
We create something
Allow me to introduce you to another great person, his name is Barnett Pearce (read his blog sometime, great wisdom). Pearce along with pal Vernon Cronen developed a concept known as Coordinated Management of Meaning (CMM). CMM says that when we communicate we create something. Instead of me sending you a message and you sending me one back we exchange messages together. From those messages we develop a shared meaning based on our unique relationship. This relationship is different from any other that I have, and through understanding what we have created I am able to communicate with you to the absolute best of my ability.
This moves beyond the walkie-talkie communication model and we try to interact with our customers and build relationships. I’ve said for years this is the real interactive marketing, not building a web page or advertising online. Is it really that hard to form a relationship with each of your customers? Unless you are Wal-mart or some large retailer I would think not.
So maybe communicating better is becoming more aware of the people we communicate with. We become aware of what we are creating with them. We become aware of what they need. Ultimately they might just become aware of us. And that is a good thing
What happens when we take the time to communicate better?
Posted by admin in Communication, Marketing on October 18, 2010
I’ve been a marketer for about 10 years now. I make it a point to work every day in some way to enhance my marketing skill and knowledge. The fact is that most of us who are successful constantly work on our skills to enhance them and make them better.
But how long have you been communicating with others? For me it is 27 years. Communicating is the one thing I do most frequent. When I market I communicate; when I sale I communicate; when I apply for a job, sit in a meeting, eat dinner with my wife, or have drinks with friends I communicate. It represents 100% of my interactions with others. Even when I am alone by myself I find ways to communicate.
We are more connected than ever before, our communication channels are seemingly endless. Yet how often do we work on our communication skill? If this is something that impacts almost everything we do shouldn’t we spend most of our skill development on communicating better?
If we take the time to communicate better then naturally we can have better relationships with the people around us. Having better relationships means doing everything we do better. Over the next week or at least until I run out of things to write about I want to explore what it means to communicate better. Feel free to let me know if there is something specific you would like me to explore.
The most important branding: You®
Embrace the “You”
As marketers and creative type we are all pretty good at making a product or company look good. Sometimes in the middle of all this we forget about our most important product. Ourselves
At one point I thought I did a fairly good job at this. I focused on it daily and things clicked. Recently I found myself frustrated. The business side of me was struggling. Moves I wanted to make closed in front of me and I felt beat up and kicked around. I was slowly growing out of touch with friends and family.
“You” rebranded
In marketing sometimes we have to rebrand our product or organization to better align with reality (or cover up problems). What I realized was the me that I was branding was no longer in line with who I really was. I was presenting something that was not the direction I was going. I had worked so hard previously to get somewhere and I didn’t adjust for the reality that I was there and needed to better show who I am and where I am going now.
(re)Searching
So I did some soul (re)searching. Just like researching new markets and building messages sometimes in order to brand yourself you need to research who you are. Think about it, meditate about it and probe the people close to you.
Take the time to develop and redevelop your personal brand. You will thank me later.