How the Impact of COVID-19 Is Changing Marketing

Well, it’s not as if we can start 2020 all over again — we’re already halfway through this year thus far. Yet, we can say one thing, COVID-19 and its recessionary impacts may be hanging around awhile. How may this have changed marketing mid-year, and possibly changed it permanently?

Well, it’s not as if we can start 2020 all over again — we’re already halfway through this year thus far. Yet, we can say one thing: COVID-19 and its recessionary impacts may be hanging around awhile. How may this have changed marketing mid-year, and possibly changed it permanently?

Such prognostications have kept The Winterberry Group, a marketing research consultancy, plenty busy since March: reading the tea leaves of government data, industry interviews, marketing dashboards, econometric algorithms, and the like. Principal Bruce Biegel told a Direct Marketing Club of New York audience this past week that indeed June has been better than May, which was better than April — when the U.S. (and much of the global) economy was in free fall.

So what’s underway and what’s in store for us midyear? Have we turned a corner?

Our Comeback Will Not Be a U-Turn — ‘Swoosh!’

When unemployment shoots up to 17.1%, and 40 million American jobs either furlough or disappear, there’s going to be a lag effect. The “wallet” recession is upon us, as consumers hang onto their savings, or eat through them, so there’s not going to be the same level of demand that drives upward of two-thirds of the U.S. economy.

New York City is a COVID-19 epicenter — and the commercial real estate market may take five to 10 years to recover, reports The Economist (subscription required). Knowledge workers will return, eventually. But densely populated urban centers, where innovations accelerate the economy, may look and feel different for some time, and that in and of itself could hamper national and global growth. Can other innovation clusters stave off the virus to protect collaboration?

And then there’s our world of advertising. Biegel sees digital being a “winner,” as traditional media continues to take a drubbing. Linear TV spending dropped by a quarter this quarter, and direct mail by half. Experiential and sponsorship spending has been slashed by 75%, as concerts, live sports, conferences, and festivals all took a public health-ordered hiatus. Yet, even in digital categories, Q2 has yelled “ouch.”

Email is the only channel to have held its own, though pricing pressure has cut margins. Social, search, and digital display all have posted drops from 25% to 40% during the quarter — and though all our eyes were home watching Disney+, Netflix, and the like, even OTT/addressable TV ad spending was down by 5%. With the Newfronts coming this week, it will be interesting to see what types of digital media may post gains.

So if June’s “recovery” in media spend is any indication, Q3 (sans Olympics) and Q4 (yes, we’re still having an Election, last time I checked) should be solid though not buoyant. Biegel says it may be a “swoosh” recovery — think Nike’s logo — down fast, but up again slowly, steadily and resiliently. Which begs the questions: Can ad businesses, business models, and brands cope with a new reality?

The “new normal” is about coming out of the COVID-19 crisis — and half of executives surveyed by The Winterberry Group aren’t expecting miracles:

Medium-Term Budget Cuts

IAB-Winterberry Group State of Data (2020)

 Q3 Will Start a Recovery … of Sorts

Source: Advertiser Perceptions, Pivotal Research Group (2020), as reported by Winterberry Group

And, Biegel reported, that it may indeed take to 2024 — with COVID-19 firmly in a rear view mirror — for a recovery to be complete, according to IPG Mediabrands Magna. It is predicting a 4.4% ad spend contraction this year, a 4% recovery next year, and “subdued” results thereafter until mid-decade.

So How Have We Changed — and Will These New Behaviors Stick?

Some effects, though, may indeed have permanence in how Americans consume media — perhaps hastening trends already underway, or creating a whole rethink of how we act as consumers. Consider these impacts:

  • Streaming to TVs more than doubled during COVID-19 crisis. Have we rewired our video consumption habits away from scheduled programming for good?
  • Mobile data traffic surged 380% in March alone. Consumers have taken to their smartphones everywhere — so how has mobile viewing altered consumer’s screen habits across devices, and will it stick?
  • DTC brands and catalogs know all about remote selling — and so do millions of consumers who have now come to love shopping this way.
  • Video game use is up 60% — opening the door to more in-game advertising opportunities. This may change the mix of brands seeking to engage consumers there.
  • In January there were 280,000 posted job openings in data analytics. There are 21,000 today. More than half of marketers expect predictive modeling and segmentation to occupy their marketing strategy concerns for the balance of 2020.
  • Tangible value matters. Consumers will be demanding more pricing benefits from brand loyalty, and less VIP experiences. We may be getting tired of lockdowns but we are steadfast in a recession, savings conscious mindset.
  • Business travel – yes, your clients may be returning to the office, but do they really want to see YOU? What can B2B marketers and sellers achieve virtually?

It’s ironic, Biegel said, that privacy laws and the crumbling cookie are making customer recognition harder in the addressable media ecosystem, just as consumers expect and demand to be recognized. Identity resolution platforms will evolve to cope with these new marketplace realities — both of which are independent of COVID-19 – but the solutions will bring forth a blend of technologies, processes, and people yet to be fully formulated. These are still open and important marketplace issues.

So assuming we’re healthful health-wise, we have some challenges ahead in ad land. I’m glad to have some guideposts in this unprecedented time.

A Look at Marketing Spend Recalibrated: Where Are the Green Shoots?

We are well into Q2, and the pandemic is having a detrimental impact on U.S. marketing spend. How much so? Firm principal Bruce Biegel recently updated some parts of The Winterberry Group’s Annual Outlook report as COVID19 took hold, citing various sources — and the updated data is worth a look.

We are well into Q2, and the pandemic is having a detrimental impact on U.S. marketing spend. How much so?

That’s where we turn to The Winterberry Group which tracks data, digital, and direct marketing spend vs. general advertising, and releases its Annual Outlook each year in January. As COVID19 took hold, firm principal Bruce Biegel recently updated some of its numbers, citing various sources — and they are worth a look:

Source: Winterberry Group, April 2020.

Green Shoots in Media

Hey, I see a green shoot here. In digital, while display, search, and social are taking the greatest hits, digital video’s loss is less pronounced — and we might guess why. Consumers are consuming digital media in record numbers. In fact, OTT (connected TV) and podcast ad spend is out of sync with the number of consumers migrating to these media, even before the pandemic took hold.

As reported in Digiday:

“According to Magna Global, OTT accounts for 29% of TV viewing but so far has only captured 3% of TV ad budgets. And as consumers increasingly flock to internet-connected TV devices, a wide range of players — from tech giants, to device sellers to TV networks and more — are building services to capture a share of the ad dollars that will inevitably flow into the OTT ecosystem.”

So if anything, advertisers may need to get their tech stacks ready to enable OTT and podcast engagement. But this is not a linear TV buy based on cost-per-thousand (CPM). This is an opportunity to personalize, target, and attribute on a 1:1 level.

Another green shoot: Email remains a staple. Again, as we stay at home, whether as consumers or as business people, it’s been email that is sustaining connections for many brands. So “flat spending” is a positive, even as price compression is underway.

Offline is not a pretty picture — right now.

Source: Winterberry Group, April 2020.

My last post sought to document U.S. Postal Service’s woes. I still believe direct mail is a brand differentiator, particularly right now — as I watch my own household pause from the sameness of screens, and take our “print” moment with each day’s incoming mail and catalogs. We’ve dog-eared pages, placed our DTC (direct to consumer) orders, and even some B2B purchases for home office supplies. (Thankfully, all but one of us are still working.)

Green Shoots in Verticals

The Winterberry Group also examined some primary verticals — which ones will lead our economic recovery?

One green shoot is identified as financial services. After the Great Recession (2008-2009), the financial sector — which prompted the Recession beginning with subprime mortgages — recapitalized and strengthened reserves. Banks had to do it, by law. As a result, they are better positioned to weather the pandemic storm; though there may be pressure to lend to less-than-stellar-credit customers, the Winterberry Group reports. We shall see. As of May 7, the NASDAQ had completely erased its 2020 year-to-date market loss.

Source: Winterberry Group, April 2020.

In the Media & Entertainment sector, live events are effectively gone — except where they can go virtual, but that’s hardly a dollar-for-dollar exchange. The good news is that media subscriptions (for on-demand media) are rapidly increasing, and ad-supported on-demand media also is increasing — pertinent to the aforementioned OTT discussion.

And another green shoot candidate, Healthcare & Pharma, is actually on neutral ground. Some trends, such as telemedicine, online prescription fulfillment, and anything COVID-related — are booming, but elective surgeries are on hold, and 33+ million laid-off Americans may wind up uninsured.

Source: Winterberry Group, April 2020.

Ingenuity — The Greatest Green Shoot of All

And my last green shoot is this — our own innovation, agility, and creativity. I leave you with this one anecdote heard last week on National Public Radio.

Can you imagine being a member of the Graduating Class of 2020? These students will go down in history perhaps as a model of resiliency. Time will tell. But next door in North Salem, NY, the town and school system landed on a novel idea: The faculty, students and families will drive one hour north to a one of the state’s few remaining drive-in theaters. The commencement address will be projected — and the diplomas handed out vehicle by vehicle.

Who knows, maybe Summer 2020 will be the Great American Comeback of the drive-in theater. Maybe Bruce will need to update his out-of-home and cinematic spending accordingly. (You can learn more from Bruce at this upcoming June 17 Direct Marketing Club of New York virtual briefing on your laptop. Registration here.)

I love such ingenuity. If you know of other examples, please share them in the comments section. Stay safe — and keep America innovating.

 

 

How to Use Content Marketing to Support Your Sales Team

Improving your sales team’s effectiveness is an ongoing process. Content marketing can help. In fact, content is no longer a nice-to-have. For most marketers, it’s a must-have. Here’s why.

Improving your sales team’s effectiveness is an ongoing process. Content marketing can help. In fact, content is no longer a nice-to-have. For most marketers, it’s a must-have. Here’s why.

Content IS Your Sales Team

For starters, today’s buyers are typically far into their decision-making journey before they invite a salesperson into the conversation. So for the first three-quarters of that journey, your content marketing is a proxy for your sales team. If it’s not demonstrating your expertise and its applicability to the problem they’re trying to solve, you will never be in the running for serious consideration by your prospects.

Being in the running isn’t really our goal, though. We want to make the short list and, ultimately, win the business. For that, content can again ride to the rescue, setting the stage for the late-funnel work that your actual sales team will do.

The question is, what kind of content will do that? Content that is optimized to attract your audience, is structured to create a story that engages your audience, and which asks the questions that will move your audience toward a decision.

Optimizing Your Content Marketing

For your content marketing to work well, you have to know who will be reading it and what their objectives are. Your content has to address the challenges they are facing and understand what their status quo looks like.

That last bit is key because your competition is not just the other firms with whom you trade account wins and losses; it’s inertia. If you can’t create a case that points to real business improvements gained by changing what they’re doing now, you won’t lose the sale to your competitors. There simply won’t be a sale.

Story Follows Research

Once you’ve done the research that helps ensure you’re speaking the using the right language and addressing the right issues, you must get their attention and get them engaged. This is not a time for same-old, same-old. It’s time for constructing a narrative that brings your value proposition to life.

Data can support your story, but the human and emotional aspect is what resonates with even the most analytical audience. Make them feel the decision they’re about to make and let the data support that feeling.

Ask and Answer

Finally, it’s question time. You should be ready to ask questions that will move your prospect toward the next step on their buying journey. And you should be prepared to answer the questions that you know (from your research) are top of mind for prospects at each stage.

Whether your content answers those questions or your sales team does will depend on the questions and on the nature of the prospect and the sale. Either way, strong content is an important part of giving your sales team the best chance for making the most of the opportunities your marketing creates.

Marketers’ New Year’s Resolution: ‘I Will Give Customers More T-R-A’

The turning of the calendar may mean a new fiscal year for many marketing organizations, but there is one constant that remains paramount for customer-centric enterprises:  TLC (tender loving care) and how we demonstrate such sentiments to our prospects, customers, and donors — whomever applies.

The turning of the calendar may mean a new fiscal year for many marketing organizations, but there is one constant that remains paramount for customer-centric enterprises: TLC (tender loving care) and how we demonstrate such sentiments to our prospects, customers, and donors — whomever applies.

According to its most recent survey of more than 13,400 C-suite leaders, IBM is recommending data users to pursue another approach in their efforts to build consumer trust: T-R-A, as in transparency, reciprocity, and accountability. See the IBM report, “Build Your Trust Advantage: Leadership in the Age of Data and AI Everywhere” (Opens as a PDF)

The report states:

“To satisfy the modern requirement for trust, leading organizations are adopting three basic principles as their guide: transparency, reciprocity, and accountability. Each provides assurance to customers, but is more than good marketing. These principles are the scaffolding that supports the modern enterprise, remade to propagate trust.”

In a time when trust is increasingly harder to earn — and where consumers question the data-for-value exchange — one may think to shun the data quest. But that is not the correct course of action, nor a viable option, at all. Instead, the answer is to triple up efforts — to seek out and ensure higher quality data sources, to ensure chain-of-trust on permissions and consumer controls, and to hold ourselves and data partners accountable for results.

According to IBM, enterprise leaders — “torchbearers” — have fused their data and business strategies as one. “The torchbearers defy data fears, enhancing the trust of customers.”  Eighty-two percent say they use data to strengthen customer trust, compared with 43% of “aspirational” enterprise data users.

So what does T-R-A entail?

Transparency

“Customers demand transparency of data associated with the products and services, and, in the case of personal data, assurances that it’s used in a fair manner and kept safe,” the report states.

Three Keys to Consumer Love: Transparency, Reciprocity and Accountability. | Credit: Pexels.com

And it’s not just about data used in marketing — it’s also about data regarding how products are developed and manufactured, for example, and user reviews and recommendations. Any data that informs the customer journey, and enables the brand promise, really.

Reciprocity

“C-suite executives understand that to get access to data, they have to give something meaningful in return,” the report states. “The challenge? Organizations often don’t know what their customers would consider a fair exchange.”

That’s a fair assessment — as most consumers say they are skeptical about data-sharing benefits; particularly where privacy is concerned. So it is incumbent upon us to discover — probably using data — what truly motivates consumers’ sense of trust and value. I don’t think we do as good a job as we could as brands, and perhaps as an industry, in explaining data’s value to the consumer. Thus, we must do better.

Accountability

“Accountability is synonymous with brand integrity,” the report opined. “To succeed in retaining trust while growing business or expanding into new marketers, marketers need to establish governance and policies to combat cyber risk and protect consumer trust and brand.”

To me, accountability extends beyond data security — and the lawsuits and brand erosion that may follow data breaches. Data governance is closer to the accountability mark: making sure our data supply chains are “clean,” and that they adhere to industry ethics and best practices.

Here’s Wishing You T-R-A in 2020

So I’m hoping my New Year and yours has a lot more T-R-A in the offing. If the consumers equates sharing of data with a loss of privacy, then no one wins — especially the consumer.

 

 

 

Dare to Scare: What If ‘They’ Closed the Internet?

But what if “they” — starting with policymakers in this country — took the extreme step of mimicking Europe, eschewing third-party data collection and use, destroying all of the free content such data transfers pay for, and effectively put today’s open Web behind pay walls and data walls?

The fragmentation of the Internet is marching along.

Europe went all “opt-in” — effectively halting a significant part of the Internet’s financing mechanism all in the name of privacy, without fairly considering the social and economic ramifications on competition, diversity, and democracy. (Or worse, they considered these aspects — and shut it down, anyway.)

China (and most despotic countries) bar access to much Western content. Will Hong Kong be next? Meanwhile, many of these “closed” countries are active players in using digital channels to stoke up social division and to meddle in free nations’ democratic processes.

And then there’s the rest of the global Internet — and the organic, disruptive, and innovative way it is built, maintained, and paid for. Simply allowing data to flow to responsible uses, and enable such exchanges to finance news, apps, games, email, social platforms, video, niche content, and so many other content and conveniences it would be impossible to list them all.

But what if “they” — starting with policymakers in this country — took the extreme step of mimicking Europe, eschewing third-party data collection and use, destroying all of the free content such data transfers pay for, and effectively put today’s open Web behind pay walls and data walls?

Sound very elitist? It is. Sound anti-progressive? It’s that, too. Anti-commercial? You bet. Anti-competitive? Very much so. Anti-consumer? Oh yes, it’s that, too. The deleterious effects may be already underway.

And if we’re not careful, it may just happen in the country that is most responsible for building the Global Information Economy as we know it. What a travesty it would be to throw such leadership away.

A recent study — just looking at the app world — gives a glimpse of what’s at stake. Looking at just nine top-used mobile apps, consumers state they would value access to such content at approximately $173 billion per year — content that is free to them today, thanks to ad financing. Wow! Further, current ad revenue for these apps is a tiny fraction of these assigned values. So, net, there is a huge economic dividend to consumers (and the economy) because these funds stay in consumer pockets, or are spent elsewhere.

As we march forth on privacy-first, we must consider what could happen if such responsible data uses were shut down by short-sighted public policy. What if the result were a “dumb” Internet? There’s still time for U.S. leadership, pragmatism, and a sensible way forward.

When Brands Apologize, Customers Often Listen and Forgive

Happy customers are loyal customers. But what happens when “surprise and delight” is actually “surprise and incite”? Social media has raised the stakes for brands. Customers, most often angry ones, have a forum to air their grievances.

Happy customers are loyal customers. But what happens when “surprise and delight” is actually “surprise and incite”?

Social media has raised the stakes for brands. Customers, most often angry ones, have a forum to air their grievances. I see it constantly on Twitter, and have admittedly participated myself, when air travel goes terribly wrong or quality falls short of expectations.

The good news is that it’s recoverable.

Brands that react swiftly, thoughtfully, and transparently are the ones who win. And by win, I mean they don’t necessarily lose customers as a result of their actions, inaction or missteps.

This week alone, two retailers were seemingly insensitive to their female customers and perceived as body-shaming the very people they want to empower.

Macy’s

Macy’s was called out in one tweet that received 48,000 likes and 6,000 comments for plates by a company called Pourtions that were highly controversial for their message. Intended to bring humor to the concept of portion control, the dinner plates feature a large ring that read “Mom Jeans,” a smaller ring that read “Favorite Jeans,” and an even smaller ring that read “Skinny Jeans.”

Macy’s responded by apologizing and vowing to remove the plates from their stores. Of course, not everyone in the Twittersphere agreed with this decision. But it does show a sense of responsibility for its products and consideration for its customers.

Forever 21

Forever 21 also came under fire this week for sending Atkins bars in online orders with plus size merchandise. They’re not just good at fast fashion, but they also showed they can deliver a fast reaction.

In response to press coverage of the “snafu,” Forever 21 said:

“From time to time, Forever 21 surprises our customers with free test products from third parties in their e-commerce orders. The freebie items in question were included in all online orders, across all sizes and categories, for a limited time, and have since been removed. This was an oversight on our part and we sincerely apologize for any offense this may have caused to our customers, as this was not our intention in any way.”

In this case, I think the word “test” is a critical one. If Forever 21 had done some market research and testing, perhaps it would have learned that a partnership with a brand like Atkins, that is depicted as a diet company, could be detrimental to its brand perception.

Conclusion

The merchandise you sell, the partners you align with, the sites where your ads run, the people you hire, the way you respond to criticism — all of these decisions impact your customers and shape your brand identity.

To err is human; to forgive, divine.

3 Types of Bias You’ll Confront in Consumer Research

Biases are ever-present in consumer research. However, there are several of steps to take to remove obvious biases and end up with objective takeaways that yield tangible value in your marketing endeavors.

As humans, we are, for better or worse, limited by biases and mental heuristics that impact the way we process information and make decisions. In certain situations, these cognitive shortcuts save us from likely pain and destruction. In other settings, they prevent us from tapping into the truth. For marketing leaders, research biases have the latter impact — introducing inaccuracies and confusion into consumer research.

3 Consumer Research Biases That Impact Your Findings

As any experienced marketing executive knows, biases are ever-present in consumer research. It’s unwise and shortsighted to assume that any piece of data is 100% free from the influence of these factors.

However, there are plenty of steps that can be taken to remove obvious biases and end up with objective takeaways that yield tangible value in your marketing endeavors. The first step is to get clear on which biases may be impacting your consumer research. There are a few common ones, including:

1. Confirmation Bias

One of the most pervasive forms of bias in consumer research is the idea of confirmation bias. This occurs when a researcher forms an opinion or belief before conducting research and allows these prejudices to influence the way the study is executed and analyzed.

The problem with confirmation bias is that it’s deep-seated and rarely obvious. Unless we’re actively looking for it, it tends to blend in and go unnoticed.

Let’s say, for example, that your business is investing large sums of money into a new product and you’ve been tasked with leading a research team to analyze customer opinions on the initial product prototypes. You know that the CEO is super excited about the product and everyone really wants it to be successful. Whether you realize it or not, when you go into a product testing phase with actual customers, this desire for success will leach into the way the study is conducted. As a result, the data may indicate a greater receptivity than is actually present. If you’re unaware that confirmation bias exists, then you’re unlikely to catch yourself in the act.

2. Culture Bias

Culture bias is a big deal with international companies that market their products and services to customers in different countries. It’s rooted in ethnocentrism, which is the principle of judging another culture based on the values and standards of one’s own culture. This stands in stark contrast to the principle of cultural relativism, which says it’s more appropriate to view a culture’s beliefs and activities through the lens of that culture.

“To minimize culture bias, researchers must move toward cultural relativism by showing unconditional positive regard and being cognizant of their own cultural assumptions,” researcher Rebecca Sarniak writes. “Complete cultural relativism is never 100% achievable.”

3. Question-Order Bias

For customer surveys, it’s important to be aware of question-order bias. This bias refers to how one question can influence the answers to subsequent questions. Respondents can easily become primed by words and ideas and adjust their responses according to other signals. While sometimes unavoidable, a more strategic and thoughtful structure will lower the risk of question-order bias.

Consider a customer survey that’s being used to gather insights into how your existing customers feel about your business (which is of paramount importance to your future marketing campaigns). While the following two examples may seem similar, they’ll actually produce two very different sets of results:

Survey A

Please rate your satisfaction with the following aspects of our restaurant on a 5-point scale (5=Very Satisfied; 1=Very Dissatisfied).

  1. Overall Experience
  2. Speed of Service
  3. Friendliness of the Wait Staff
  4. Atmosphere in the Dining Room
  5. Food Quality
  6. Menu Selection
  7. Value

Survey B

Please rate your satisfaction with the following aspects of our restaurant on a 5-point scale (5=Very Satisfied; 1=Very Dissatisfied).

  1. Speed of Service
  2. Friendliness of the Wait Staff
  3. Atmosphere in the Dining Room
  4. Food Quality
  5. Menu Selection
  6. Value
  7. Overall Experience

The question order in these surveys is almost identical, but with one exception. Customers are asked to rate their “overall experience” at the beginning of Survey A and at the end of Survey B. Neither one is right or wrong, but both impact the data.

In Survey A, customers are asked to think generically and then specifically. There’s a tendency for customers to force the answers from questions two through seven into alignment with the answer from question one. In Survey B, customers are asked to think specifically and then generically. The tendency here is for the answer to number seven to mimic the answers to the previous couple of questions. If five and six receive low grades, then seven will, too.

You might not be able to totally eliminate question-order bias from your consumer research, but it’s imperative that you spend time thinking about it so you’re aware of how it influences your results. Using multiple surveys with different question orders may mitigate the impact on your overall data.

Pursuing Data-Driven Objectivity

Identifying the presence of a bias is one thing. Figuring out a way to eliminate the bias and strip away outside influence is much tougher. Here are some suggestions:

  • Be aware of weaknesses. Every research team will be more inclined to fall victim to one bias or another. Being aware of the biases that are most likely to affect your results will help you remain vigilant.
  • Hypothesis over expectations. It’s okay to go into a research opportunity with a hypothesis, but it’s unwise to enter in with strong expectations; the latter will get you into trouble. Nix the expectations and let your results guide your thinking.
  • Run tests. Sometimes you don’t know you’re exposing your data to a bias until you get some actual results from your research. The best thing you can do is run a handful of tests on the same research topic and compare results. Online surveys are great for this. You can create multiple surveys within the same research study and frame the questions, structure, flow, etc., differently on each. If there’s a high degree of variance between the survey results, this indicates a high presence of research bias. If the results are relatively consistent — despite the unique delivery of each survey — you can feel more confident in your results.
  • Involve multiple people. You’re far more inclined to fall victim to research biases when you’re the only one calling the shots. For a more objective approach, involve multiple people. This will lower the risk of a bias going undetected. (Though you’ll have to be careful not to let groupthink characterize your team.)
  • Study your data. Finally, be sure to study your data meticulously and cautiously. The results of your research tell a story, and it’s important you don’t jump to conclusions without considering it from every angle.

You’ll never obtain 100% objective results from your market research. There will always be some trace presence of bias, and you can’t do anything about it. However, by eliminating the obvious biases and emphasizing the need for greater subjectivity, you can enhance your results and maximize the value of your market research endeavors.

Are Boomers Really Underserved by Digital Marketers?

Marketing to Millennials is out-sized in digital media, probably because of the upside potential. Digital marketers see future lifetime value is always bigger when you’re going to live another 50 to 70 years.

Did you hear the one about the entitled calling out the entitled?

I’m entitled. I was born during the peak year of the Baby Boom — and one thing I never had to think about was being ignored by marketers. Even digital marketers today.

Riding the “age wave” as a consumer, I was courted by brands from a tender young age. I was taught young how to be a good American consumer, and I was duly paid attention to by marketers.

And though the peak year of the Baby Boom presented challenges growing up — we all competed fiercely for college placements, job placements, housing, and status — it also prepared us well for the Reagan era’s rugged individualism, a concept and social structure that seems to have gone far, far away in our “it takes a Village” reality today. At least in the ’80s, I could afford to move to New York — though barely.

Witness a new generation — the children of Baby Boomers, Millennials — who are rising to dominate the workforce, and asserting new social values (built on inclusiveness, sustainability, fairness, and tolerance) and, gee, are brands paying attention to them! No, I’m not jealous — I’m thrilled. No, really!

Transparency, Authenticity, Sustainability, Diversity, On Demand — Brand Attributes That Appeal

According to a newly updated Deloitte Insights study, there are nearly as many Millennials as Boomers in the United States. These two generations are both forces for economic growth — as consumer spending drives two-thirds of the U.S. economy. Boomers certainly have more disposable income — and Millennials have more debt relative to income. But where digital strategy drives the marketing, Deloitte reports, Boomers may matter less, at least in practice. My guess: Marketing to Millennials is out-sized in digital media, probably because of the upside potential. Future lifetime value is always bigger when you’re going to live another 50 to 70 years.

Also, Millennials live, work, and play online. Boomers consume digitally, too. But when you tune into the nightly television news, you know the audience is comprised of Boomers and the Silent Generation before them. (Granted, when I watch TV news, I’m also skimming my smartphone.) Just watch the ads for prescription drugs, incontinence products, memory care, nutraceuticals, and other products for an aging audience — and you know there’s hardly a soul under 40 (or 50) watching scheduled newscasts anymore. The cord-cutting is rampant when “triple-play” packages cost hundreds per month, and Millennial-led households and individuals don’t see any need or logic to pay like their parents do, even if they can afford it.

They consume media completely differently, and always can steam any live events, news included, from their own trusted sources fairly easily. Media consumption, disrupted.

Brand attributes are changing, too. Many direct-to-consumer brands, popular among Millennials, have arisen not just because of perceived convenience and superior product, if that is indeed true — but because they connect using data flows that recognize the consumer from device to device, and learn in the process (that matters). They also connect because of what the brand represents, by establishing emotional and identity connection. Does the brand speak to the individual with respect and display a social aptitude? If the answer is yes, you have a better chance of gaining business and loyalty. It helps, too, that marketing is personalized at mass scale – and product personalization is booming. As “social” a cohort as Millennials are, they still demand “rugged individualism” when tailoring the product or service to their own wants, needs, and interests. For any of us at any age, we love such personalized connections, too.

So let’s congratulate Millennials, their digital prowess, and the brands’ love affair they are experiencing on their devices — and that I’ve enjoyed for decades elsewhere everywhere. It’s not as if I’m ignored online, I know I’m still coveted. But let’s not talk about sex.

digital marketers
Photo: Chet Dalzell, Photo inside JFK – Alitalia Lounge, 2019. I’ve enjoyed the attention. | Credit: Chet Dalzell

3 Steps for Building Brand Authenticity When Consumer Trust Is at Rock Bottom

Creating brand authenticity is a huge challenge. This is not only because it requires major coordination from all company functions, but it also takes highly focused discipline from strategy and planning to execution. Generating authenticity has three major components.

In my last post, I discussed how brand trust in the U.S. may have hit rock bottom and that marketers need to build brand authenticity. In this article, I would like to discuss a bit about how companies can address this challenge.

Creating brand authenticity is a huge challenge. This is not only because it requires major coordination from all company functions, but it also takes highly focused discipline from strategy and planning to execution. Generating authenticity has three major components: setting expectations, consistently meeting those expectations and actively managing failure. While these components seem simple, executing them well should not be easy. If it is, you are probably doing it wrong.

Step 1: Setting Expectations

When setting expectations, companies should remember that customers do not need you to solve all of their needs, just the needs that you can solve well. We have seen countless examples of companies entering spaces where they are out of their element, in search of new growth streams.

Many times, this ends in a poor customer experience and a huge financial hit. This is where the brand team should lead the conversation around what brand promises the company should make to its target markets. In this statement, “should” is an operative word; but it is often replaced by “want to” or “could,” in practice.

This happens because the market research identifies an unmet need or underserved segment. Then, the brand aspires to fill that gap without properly addressing its corresponding operational capabilities.

One example of how a company did it right is Domino’s pizza. Its well-documented campaign — apologizing for historically bad pizzas and promising a better experience — was bold and brilliant. However, it would have been a humiliating and epic fail if it wasn’t backed by a concerted and highly organized operational transformation.

Step 2: Meeting Those Expectations

Executing well is the next critical component, which has two managerial subcomponents:

  • measuring the customer experience; and
  • listening to the customer.

Companies primarily fail here, because they don’t know what to measure or where to focus. CX can be immensely detailed and complex. That can lead to overwhelming or underwhelming measurement strategies.

Assume you are managing a burger chain. You can measure how often you run out of key menu items or measure customer satisfaction with condiment packaging. Knowing where your priorities lie is important, but is often not as obvious as the previous example would illustrate. This leads to the second subcomponent, listening. Effective listening isn’t just about regular surveys or feedback. Customers of your burger chain may state they are frustrated by hard to open, messy ketchup packets. When looking at behavioral data, how often does that actually lead them to forsake the brand? How about when the menu item they want has run out?

Most market research, by its exploratory nature, is often exhaustive and can present many pain points which need addressing. While some methods, such as conjoint analysis, may help mitigate this issue, there is no substitute for analyzing real behavioral data.

Real listening lies at the intersection of what customers say and what they do.

Step 3: Managing Failure

Finally, brand authenticity requires that you have a prevention and mitigation plan in place, because mistakes happen.

Yes, it is important to “make it right,” and that should be done as soon as possible.

However, it also means knowing the difference between a mistake and a broad violation of the brand essence, or the brand’s core values.

Examples range from knowingly compromising on customer safety to highly public displays of brand hypocrisy. To avoid trust-destroying events, companies should conduct a brand trust audit and examine every compromise it makes that is counter to the core principals of the brand.

Some compromises need to happen, but when they do, they need extra oversight. For example, look at the college admissions scandal I mentioned in my previous post. Many believe that the elite colleges involved were victims. I disagree. Their primary proposition in the market is intellectual heft; yet there are clear avenues where they knowingly compromise on this proposition, such as athletic departments. The colleges should have been much more careful about monitoring that comprise and making sure it was not abused.

Compromises need to be made; however, once brands lose control over the quantity and quality of those compromises, the brand loses control over the values it claims to project.

Conclusion

I ended my last post by writing “Authenticity means saying what you will do, doing what you say and showing that you mean it.”

In retrospect, the statement seems to be focused too much on honest intentions (also sounds like a politician trying to sound folksy and humble.) I will not take back those words, because I also believe them to be true.

In this post, however, I acknowledge that much more goes into this than genuinely honest and good intentions.

How Will Your Audience Receive Your New Product?

Product innovation is necessary for every company to grow and evolve in a competitive market. But if your audience “doesn’t get” your new product, success is much less of a guarantee.

Product innovation is necessary for every company to grow and evolve in a competitive market. But if your audience “doesn’t get” your new product, success is much less of a guarantee. Before you unveil your hard-won innovations, here are some ways to ensure you’re targeting the segments of your audience who will be the most receptive — both to the new product and accompanying marketing efforts.

First, Really Know Who They Are

While basic demographics like age, marital status, geographic location, hobbies and other points help you form a picture of your audience, to really know them means gaining specific, unique insights about them. You want to understand more than just who they are on paper by finding out how they think and feel and what they truly need. To do this, you have to integrate survey data with rich behavioral insights gleaned from big data.

Look at how personality profiles developed through a scan of big data reveal the personality characteristics common to the potential target audience for a new robot vacuum:

Credit: GutCheckIt

This audience ranks high for agreeableness, which points to other traits like altruistic, modest, and empathetic. So when communicating with them about the vacuum, messaging that uses a social responsibility angle will likely attract and feel relevant to them.

How your new product appeals to the individual needs and lifestyles of your audience further deepens your understanding of them. Consider in this summary of needs how the robot vacuum could hit home with the audience’s high ideals, drive toward harmony, and interest in self-expression, as well as how the vacuum could appeal to the audience majority who enjoy keeping their home tidy.

Credit: GutCheckIt
Credit: GutCheckIt

Then, Determine How Best to Reach Them

Once you’ve formed a full understanding of your audience’s personality, needs, and lifestyle, combine your learning with a study of the type of media consumed and during which times of day. For example, the vacuum audience learns about new products mainly through social media rather than television or promotional emails. They spend 7-plus hours per week on the web and using apps, mostly in the early evening hours between 5-8 pm.

Credit: GutCheckIt

To reach this audience effectively, online or mobile campaigns work best, with ads that could be shown on traditional TV in the later evening hours between 8-11 pm.

To learn what type of unique insights you could uncover about your brand’s audience before you launch a new product, visit the GutCheck website to learn more.