Redefining the Art of Minding Your Ps and Qs

You know hospitality when you feel it, or as officially defined by dictionary.com it’s “the quality or disposition of receiving and treating guests and strangers in a warm, friendly, generous way.” Hospitality is actually more valuable than ever in our rushed, device-first and attention-deficit overloaded world. And yet, I find it missing in many brand experiences.

Multi-restauranteur Danny Meyer wrote a book called “Setting the Table: The Transforming Power of Hospitality in Business” that caught my attention during the holiday season. Both in his book and on his website, Meyer shares his main business philosophy that has guided all 11 of his New York-based restaurants:

This is the age of the Hospitality EconomyTM. Superior products and excellent service are no longer enough to distinguish your business. How you make your customers feel is what sets your business apart—and that’s what hospitality is all about. Organizations that embrace a hospitality strategy:
1. Earn a reputation as a best place to work
2. Win customer loyalty
3. Generate persistent top line growth

Meyer believes wholeheartedly that “Hospitality is a sustainable competitive advantage. While others try to copy your products, no one can replicate the hospitality experience you create for your stakeholders.”

I couldn’t agree more. You know hospitality when you feel it, or as officially defined by dictionary.com it’s “the quality or disposition of receiving and treating guests and strangers in a warm, friendly, generous way.” Hospitality is actually more valuable than ever in our rushed, device-first and attention-deficit overloaded world. And yet, I find it missing in many brand experiences.

Perhaps, you, too, experienced this lack of hospitality over the past holiday shopping season: Brand ambassadors who often didn’t make meaningful eye contact, brusquely said “not a problem” when there was indeed a problem you needed for them to solve, and a goodbye after a transaction without a “thank you.” Why do businesses spend lots of capital on ad campaigns and new product introductions only to slip up on these basics—the real, face-to-face human interaction?

When I do experience genuine hospitality from companies, the repercussions are long and lasting and bring a smile to my face. This is likely to happen when I fly on Southwest Airlines or grab a quick lunch at Chipotle or Chick-fil-A. These brand ambassadors exude enthusiasm, seem to truly love what they are doing and make a conscious connection to engage with their customers, to treat them as friends and in doing so, validate the reasons the customers choose to spend their time and money with these companies.

Earlier this month I checked into The Ritz-Carlton for an annual girlfriend getaway. The brand lived up to its reputation for luxurious elegance, but what impressed me most was their lived value of “being ladies and gentlemen who serve ladies and gentlemen.”

My conversations with the various Ritz-Carlton team members I encountered—whether with parking attendants, concierges, front desk clerks, wait staff or spa personnel—were gratifying. They were genuinely concerned about all aspects of my stay and welcomed me like a good friend you were looking forward to getting to know better on this visit.

I like thinking about the verbs that drive hospitality—welcome and empathize—and just how they can be leveraged to a brand’s competitive advantage. I spoke with The Ritz-Carlton’s Human Resources Manager Greg Croff about this exact topic.

“Here at The Ritz-Carlton, we are all about memory-making. We want all our interactions to be positively memorable experiences. And, it all starts with our hiring process. We look for people who care about building relationships, who are naturally empathetic and easy to talk with, who make eye contact and who truly believe it is ‘their pleasure’ to take care of our guests. We welcome our new hires in a way we want them to welcome our guests. Constant hospitality is our DNA. We reinforce this each and every day with our Daily Lineup where at the start of each shift the team gathers for 15 minutes to focus on one aspect of our Gold Standard. We share WOW! stories of how team members reinforce our service mystique. We learn from each of our ladies and gentlemen about raising the bar and creating memories.”

Just how well does your brand mind its Ps and Qs? “Please,” “thank you,” “my pleasure” … simple words and phrases that may or may not bookend a customer’s experience with your brand. Why not conduct a hospitality audit with your leadership and see if this is one area of competitive advantage your brand can improve upon this year?

There’s GOLD in that Mailbox – and in that Pencil Box, Too

I’m now amid judging the 2014 Direct Marketing Association International ECHO Awards—which is always a pleasure. In just a few days of judging each year, I get to see what agencies and clients the world over put forward as their best in data-driven direct marketing, encompassing all channels. For direct mail, there is always one campaign that gets honored with the U.S. Postal Service-sponsored Gold Mailbox Award, which recognizes the most innovative use of the medium

I’m now amid judging the 2014 Direct Marketing Association International ECHO Awards—which is always a pleasure. In just a few days of judging each year, I get to see what agencies and clients the world over put forward as their best in data-driven direct marketing, encompassing all channels.

For direct mail, there is always one campaign that gets honored with the U.S. Postal Service-sponsored Gold Mailbox Award, which recognizes the most innovative use of the medium. The named winner doesn’t have to be a direct mail-only campaign—an integrated marketing effort will do, too, as long as there is an outstanding direct mail component, whether foreign or domestic.

This year’s Gold Mailbox campaign will be selected in early August, and will be revealed at the 2014 International ECHO Awards Gala during the DMA2014 Conference in San Diego, Cali. I’ll be there, with luck.

In 2013, the USPS Gold Mailbox went to a German non-profit organization, Chill Out, which used a unique dimensional—a harmless looking pencil box—to educate school administrators in its target audience about the dangers of drug addiction in young children. What was inside the pencil box was dummy drug paraphernalia, an indication that what looks innocent on the outside can hide dangers within. The interior also included how to contact Chill Out, which provides school-based drug prevention programs. The blunt uneasiness of the campaign communicated both urgency and immediacy, and a means for schools to combat this growing problem—affecting one child in seven—head on.

The dimensional mailing, created for Chill Out by Wunderman Germany, generated stellar impact: Of 120 schools sent the mail piece in the German state of Brandenburg, 48 contacted Chill Out, and 29 schools now have integrated the Chill Out drug prevention program.

Not many business-to-institutional mailings generate a 40 percent response rate, with a subsequent conversion of more than 60 percent of respondents. But when the list is accurate, the message relevant—and the creative discerning—engagement happens. Direct mail has power to arrest, to stimulate and to motivate action, especially when it dares to be different. There are a lot of grateful school heads, parents and students, as a direct result.

And a majority of ECHO judges, too.

Marketing ROI in B-to-B: Why Is It So Hard, and What Can We Do About It?

The other day, I had the pleasure of discussing the challenges of marketing ROI with Jim Obermayer, CEO and executive director of the Sales Lead Management Association, on his Internet radio show. Our conversation got me thinking: Why is the Holy Grail of marketing ROI so tough to achieve in business markets? And what can we do about it?

The other day, I had the pleasure of discussing the challenges of marketing ROI with Jim Obermayer, CEO and executive director of the Sales Lead Management Association, on his Internet radio show. Our conversation got me thinking: Why is the Holy Grail of marketing ROI so tough to achieve in business markets? And what can we do about it?

The “why” part is pretty clear: Business buying cycles tend to be long, and involve multiple parties at either end. Marketers produce campaigns to generate an inquiry, and then qualify that interest with a series of outbound communications, and finally pass the qualified lead to a sales rep for follow up. From that point, it can take more than a year to close, and involve a slew of people on the customer side, from purchasing agents, to technical specifiers, to decision-makers.

The sales process is also complex, involving not only the face-to-face account rep, but sales engineers, inside sales people, and others who help get all the buyers’ questions answered, negotiate the terms, deliver, install and trouble-shoot the product, and whatever else needs to be done to satisfy the customer’s needs.

So, consider the difficulty of establishing the numbers that go into an ROI calculation in this kind of situation. Just to put a definition behind the concept: ROI, meaning return on investment, subtracts the marketing expense from the revenue generated, and then divides by the expense, resulting in a percentage that shows how much net return was produced by the investment.

But in this lengthy, multi-party, multi-touch selling situation, the “investment” part can be pretty tough to get at. Frankly, it’s a bit of a cost accounting nightmare, assigning an expense number to each sales and marketing touch that resulted in a particular closed deal. This brings up issues of variable versus fixed costs, marketing touch attribution—the list goes on and on.

Worse, the “return” part presents its own challenges. First problem is connecting a particular lead to a particular piece of revenue, which means carefully tracking a lead over its multi-month process toward closure.

Further, if a third-party distributor or agent is working the lead, it’s very likely that revenue results reporting is not part of the deal. With good reason: The distributor considers the relationship with the end-customer as his, and none of the manufacturer’s business. So the marketer who generated the lead often has no visibility into the associated revenue. Even if the deal was closed by a house rep, you’re looking at the endless squabble between sales and marketing about who gets the credit.

You can’t blame B-to-B marketers for throwing up their hands and relying on interim metrics like response rate and cost per lead. Especially when marketing staffers come and go, and may not even be in the job when the lead generated a while ago finally converts to a sale.

This is why I was so pleased at the arrival of the new book by Debbie Qaqish, The Rise of the Revenue Marketer, where she urges marketers to raise consciousness of their role in driving revenue results. “The revenue marketer uses the language of business,” she says. Examples of the metrics she recommends for revenue marketers include funnel velocity, sales conversion rates, pipeline revenue and campaign ROI.

My conclusions from this investigation:

  • Begin with a deep conversation with your finance counterparts to get at the best way for marketing to serve your company’s financial interests, like:
    • The right approach to assigning sales and marketing expense.
    • Whether to calculate returns based on net sales or on gross margin.
    • Decide which expenses are fixed and which are variable.
    • How to attribute the contribution of sales and marketing touches across the sales cycle.
    • Setting the ROI “hurdle rate” needed to support your company’s profitability goals.
  • Figure out where to get the revenue and expense data—not everything will be in your CRM system. Your finance counterparts should be help you source the data you need.
    • If a distribution channel party is a roadblock to revenue visibility, conduct a “did you buy” survey into accounts to which qualified leads were passed.
    • If the account-based revenue is captured internally, try supplementing your CRM system with data match-back to connect campaigns to sales, circumventing the arduous process of following a lead along its complex conversion process.
  • Set clear objectives for each marketing expenditure, so you know how to declare ROI success when you see it.
  • Get inspiration from The Rise of the Revenue Marketer, Debbie Qaqish’s innovative thinking on the role of marketing in B-to-B.
  • Get an education from Jim Lenskold’s 2003 classic, Marketing ROI: The Path to Campaign, Customer and Corporate Profitability.
  • If to many obstacles are in the way, fall back and rely on “activity-based” metrics like cost per inquiry and cost per qualified lead, which tend to be pretty easy to calculate, being mostly within the purview of marketing.

A version of this article appeared in Biznology, the digital marketing blog.