5 Data-Driven Strategies to Feed Your Customer Obsession

The digitization of our culture and marketplace has made it even more important for marketers to be customer advocates. Every bit of content we create, every retargeting campaign we develop and every customer journey we attempt to map … all this must be tied to superior and engaging customer experiences. It’s the only reason marketing exists.

The digitization of our culture and marketplace has made it even more important for marketers to be customer advocates. Every bit of content we create, every retargeting campaign we develop and every customer journey we attempt to map … all this must be tied to superior and engaging customer experiences. It’s the only reason marketing exists.

This Forrester Research recently claimed that companies obsessed with customer experience are more profitable and see higher growth. Consider Amazon, Nike or Mercedes Benz, where innovation is part of the culture. Consider how an obsession with innovation at Apple and Google translates to customer delight in their products. For the rest of us, it may be harder without that kind of a culture behind us, but frankly, there is no longer a choice for marketers: Each of us must adopt an attitude of obsession with customer satisfaction. Then, we need to employ a systematic approach to optimizing everything we do toward customer value. The key question to ask at every point in your day, “Is what I’m doing adding real value to a large number of high-value customers?” If not, change it or dump it.

Like any change, in life or business, it starts with attitude. If you don’t work for a customer-obsessed company, can you successfully meet the demands of your market and rise above the competition? At a minimum, companies must embrace that digital and customer experience is everyone’s business—great ideas and the seeds of change can come from anywhere, regardless of title, but do need to be cross-functional and valued to blossom.

It’s time to make this transformation personal. Consider how you can use the technology you have to adapt the customer experiences that you do control, and demonstrate success to the rest of the organization. This proof of concept approach is a great way to get more budget, too. Incremental change is great—improvements to a campaign for next time or an adjustment to the timing for a triggered message are good starting points. However, more is needed.

We must re-think the customer experience across an ecosystem, and not just a set of interactions with owned media or branded touchpoints. Collaborate with other suppliers and influencers to focus on digital efficiency so that you can react in “right time.” Right time is an alternate to “real time” that recognizes that immediacy is not the most effective reaction in all situations. This is especially true since the customer journey is non-linear.

Thinking differently can be difficult inside an organization—especially if you are successful. Often, good ideas are limited because of the way we ask questions about our customers or our marketing programs. A research experiment with third graders provides some proof of why creativity goes beyond tactical application of cleverness or humor. (The video is about two minutes long.)

The project gave two groups of third graders the same assignment—to make a picture out of a triangle. When the assignment was narrowly defined, the pictures came out nicely, but not that different from each other. When the assignment was not defined, the pictures came out wildly different—and much more creative!

Don’t just wait for disruption to come to your industry—learn to disrupt your own business. Truly aim to understand whatever is blocking your path to innovation and customer connection. Consider some of these strategic elements that can help you break free of legacy patterns and test new ideas.

1. Use the Data You Have to Zero-in on Key Segments. Use microtargeting to really get to know your customers. Dig deep into customization and personalization opportunities to find the small, yet potentially profitable subsets of your market and niche offerings.

2. Separate the Signal From the Noise. Being able to do so is a powerful intoxicant: If I can just repeatedly do that one perfect thing that will really drive our business forward, I’d dominate our market and be a hero. Problem is, identifying that one perfect thing is very hard. Marketing analytic models may be more accessible than you think—and perhaps are no longer a luxury, but an imperative for understanding the customer needs—and predicting future behavior. Bring these practices closer to the campaign management and segmentation strategy—and give your analytics teams a seat at the table. Consider some of these key questions that analytics models can answer:

a. What dynamic forces are affecting my customer and how effectively am I changing to meet these changes?
b. Are there new market opportunities developing that I can take advantage of and become the industry leader?
c. Would this new product be interesting to our current customers? What must be true for customers to feel pain? Who are our most valuable customers, and over time? What outside factors impact customer loyalty and retention?
d. What are the characteristics of our best prospects?
e. Which marketing messages and campaigns are contributing, and when do they contribute during the lifecycle?

3. Marketing Automation Tools Are Slowly Evolving to Help You Manage These Changes, but you may need to bolt together point solutions in the meantime (especially if a big upgrade is not in your budget this year). Look to consolidate applications into a platform with data and process level integration to improve efficiency and effectiveness; work to integrate marketing technology with the enterprise infrastructure to reveal deeper insights into customers, partners and market opportunities. Here is a good reason to establish inter-disciplinary teams with IT and sales and customer service and legal to improve marketing contribution, vendor management, due diligence and governance practices.

4. Paid Placements (Native Advertising) Are Here to Stay. Spend your money on the right content and platform and understand which digital properties are performing best. Build budgets and relationships around content placement, sponsorship opportunities, syndication services and content recommendation platforms. Content marketing can’t be limited to owned and earned media if you need to reach larger and broader audiences.

5. Focus on Quality Content; we are all publishers now. Mobile will continue to dominate, so master its impact on your content and targeting. All our writing has to be compelling and adaptable across platforms, and written to the tastes of narrowly targeted personas. Automation tools help to make sure your content is repurposed with panache and context.

Clearly there’s lots of opportunity for growth in many areas of marketing success, particularly as we align our investments in areas where vendors have incentives to innovate. Scouring your budget for “past success” might be a good place to start: Given the advances in technology, will what worked in 2010 or even in 2014 work now in 2015? Please share your own tips and challenges for creating a customer-obsessed culture in your organization in the comments section below.

Marketing Success Is (Almost) All About the Data: Optimizing Customer Loyalty Behavior Initiatives

Much of what I’ve learned over the years about sales, marketing and customer service has to do with the critical importance of customer data, and how those data are converted to actionable insights. It’s how companies generate the right customer data, manage and share data the right way, and use it at the right time. It’s also how they use data to the best effect, to optimize loyalty and profitability, that makes them successful, or not, on an individual customer basis. Culture, leadership, and systems will facilitate effective information gathering, storage and application; and, CRM, CEM, ERP, or other acronyms notwithstanding, it’s impossible to be successful without having as much relevant anecdotal and dimensional content about customers as possible.

Much of what I’ve learned over the years about sales, marketing and customer service has to do with the critical importance of customer data, and how those data are converted to actionable insights. It’s how companies generate the right customer data, manage and share data the right way, and use it at the right time. It’s also how they use data to the best effect, to optimize loyalty and profitability, that makes them successful, or not, on an individual customer basis. Culture, leadership, and systems will facilitate effective information gathering, storage and application; and, CRM, CEM, ERP, or other acronyms notwithstanding, it’s impossible to be successful without having as much relevant anecdotal and dimensional content about customers as possible.

Bill Gates, often a prophet, said in “Business @ The Speed of Thought” (1999):

The best way to put distance between you and the crowd is to do an outstanding job with information. How you gather, manage and use information will determine whether you win or lose.

He might have added, had he really understood how to create and optimize customer loyalty, that what information, particularly customer-specific information, a company collects, and how they manage, share and apply it to the customer will determine how successful they can become.

One of my key sources for the uses of information gathered by customer clubs and, particularly, loyalty programs, for example, is friend and colleague, Brian Woolf (www.brianwoolf.com). Brian is president of the Retail Strategy Center, Inc., and a fountain of knowledge about how companies apply, and don’t apply, data generated through these programs.

In a Peppers & Rogers newsletter, for example, Don Peppers quoted Brian in his article, “The Secrets of Successful Loyalty Programs”:

Loyalty program success has less to do with the value of points or discounts to a customer, and much more to do with a company’s use of data mining to improve the customer experience. Top management hasn’t figured out what to do with all the information gleaned. You have all this information sitting in a database somewhere and no one taking advantage of it.

You need to mine the information to create not only relationships but also an optimum (purchasing) experience. The best loyalty programs use the customer data to improve not only promotions, but also store layout, pricing, cleanliness, check-out speed, etc.

Firms that do this are able to double their profits. When these elements are not addressed, all you’re doing is teaching the customer to seek out the lowest price.”

Tesco, one of the world’s largest retail chains, is using its customer information for a number of marketing and process initiatives. In his book “Loyalty Marketing: The Second Act,” Brian described how Tesco leveraged customer data drawn from its loyalty program to move into offering banking and financial services:

With information derived from its loyalty card and enriched by appended external demographic data, they can readily develop profiles of customers who would most likely be interested in basic banking services, as well as an array of related options, ranging from car loans and pension savings programs, to insurance for all types of needs—car, home, travel and even pets. It costs Tesco significantly less than half of what it costs a bank to acquire a financial services customer. Without a doubt, having detailed customer information gives them a competitive edge.

A few years ago, Tesco parlayed its offline customer data to also become the world’s largest online grocery and sundries home delivery service. Additionally, Tesco uses its customer data to target and segment communications to the millions of its loyalty program members by almost infinite demographic, purchase and lifestyle profiles. In his book, Brian notes that Tesco can create up to 150,000 variations of its promotion and reward statement mailings each quarter. These variations, as he says, ” … are both apparent and subtle, ranging from the product offer (i.e., which customers receive which offers at what price) to the content of the letter and the way it is personalized.”

Tesco is absolutely a company that knows how to leverage customer information. Its customer database contains not just demographic and lifestyle data, food spending in stores and on home delivery, but also specifics about its customers’ interest in, and use of, a diverse range of non-food products and services. As Bill Gates’ statement suggests, incisive and leveraged customer data has enabled Tesco to put distance between itself and its competitors, in both traditional and non-traditional retail markets.

An understanding of the real value and impact of customer information, and a disciplined plan for sharing and using the data to make a company more customer-centric, is needed more than ever. A good analogy, or model, for CEM and loyalty program effectiveness or ineffectiveness in building desired customer behavior, may be what can be termed the “car-fuel relationship.” A car, no matter how attractive, powerful and technically sophisticated, can’t go anywhere without fuel.

Not only that, to reach a desired destination, the car must have the right fuel for its engine, and in the right quantity. For customers, the car is CRM and its key data-related systems components (data gathering, integration, warehousing, mining and application).

The destination is optimized customer lifetime value and profitability. The fuel is the proper octane and amount of customer data.

Leading-edge companies are focusing on customer lifetime value as a destination. They are collecting the right data and using the right skills, processes, tools and customer information management technologies to make sure that key customer insights are available wherever they are needed, in all parts of the enterprise. Jeremy Braune, formerly head of customer experience at a leading U.K. consulting organization, has been quoted as saying: ” … organizations need to adopt a more structured and rigorous approach to development, based on a real understanding of what their customers actually want from them. The bottom line must always be to start with the basics of what is most important to the customer and build from there.”

I completely agree. It’s (almost) all about the data.

Why Contextual Advertising Is Still Hard

Contextualized advertising is serving the right message to the right person at the right time. Standing in the way of that goal are several hurdles. Among them: user personalization, segmentation and a deluge of data

Contextualized advertising is serving the right message to the right person at the right time. Standing in the way of that goal are several hurdles. Among them: user personalization, segmentation and a deluge of data.

Mobile personalization can create additional complexities that we don’t generally see on the PC side of the world. This can be both a challenge and an opportunity, but adds some new dimensions to how we work to connect with consumers.

This difficulty in leveraging user behaviors makes micro-segmentation more difficult. This is where real value from contextualized ads is found. As close to one-to-one as you can make an ad, the more value it has for the recipient. Having segments that are too large can decrease the overall impact of the ads for a given consumer.

Advertisers can improved their segmentation by sifting through omnichannel data sets. While there’s great progress in this area, attributing online, real world and mobile actions to an end result remains elusive to some of the industry.

New Tools Making Contextual Advertising Easier
New data tools, optimization techniques and leveraging exchanges are all emerging to make contextual advertising easier.

Algorithms that can recognize and contextualize mixed data sets are paving the way for more relevant contextual ads. You can target based on location (information that’s automatically provided by a mobile device), behavior and by predetermined personalization rules. So, someone is now seen as a specific category of user based on what they do, where they are and other relevant data. Messages can be personalized based on these characteristics to get the right ad in front of the right person.

Once a user can be tied to a mobile number, this opens up a world of contextual opportunities. These IDs can be closely tied to segment and location, and passed along to real-time-bidding (RTB) exchanges. Here, brands and advertisers can serve a contextualized ad to the correct mere moments after he/she makes a trigger action. Where as before, this data would be aggregated and analyzed monthly or weekly, we are getting close to the point of real time analysis and optimization.

The Impact of Future Technology and Contextual Ads
The “Holy Grail” of contextual advertising is connecting relevant ads that are optimized for a single individual. Technology is heading in that direction.

Wearables will feed advertisers never before accessible biometrics that could indicate when someone needs a sandwich or bottle of water before the person realizes it.

Interactive TVs and cross-screen attribution will pull together all parts of a person’s day. Ambient qualities, like time of day or weather, will become data points that advertisers can assess and use to target consumers.

As these technologies, combined with faster servers, make valuable contextual advertising an everyday occurrence, we will see a shift in the advertiser/consumer relationship. It will become more symbiotic. Users will be able to decide with what and whom they want to interact. Those advertisers who can use data to provide users the greatest value will prosper. Those who can’t make sense of data will suffer as consumers take their business elsewhere with a quick click on an iPhone.

Direct Marketing Day @ Your Desk Recap: Mobile Strategy

If you didn’t have the chance to attend Direct Marketing Day @ Your Desk, you missed out. Lucky for you, I wanted to quickly recap my session on creating a successful mobile strategy.

If you didn’t have the chance to attend Direct Marketing Day @ Your Desk, you missed out. Lucky for you, I wanted to quickly recap my session on creating a successful mobile strategy.

When looking at businesses that are truly successful in mobile, you’ll find everything they do is based off of the Mobile Success Pyramid. This is based off of Bruce Hershey’s “4 Pillars of Mobile Marketing” in that with a pyramid, each section can only be supported by the piece beneath it, making the foundational elements more important.

Let’s look at the pyramid from the bottom up:

At the foundation, you have Strategy.

Strategy is made up of a handful of things:

  • Who is your customer? If you haven’t already created customer avatars, you should do so in order to have a target marketing message.
  • What are you trying to accomplish? This is where you identify your business objectives and goals and assess your current marketing strategy.
  • Why are you in business? What is your mission, unique selling proposition or value proposition?
  • When do you need to reach the goal? All good strategies have a time associated with them. Give yourself a deadline to reach your goal and create a roadmap to get there.

As you define your objectives, make sure:

  1. They are measurable and quantifiable. Example: Increase sales by 15 percent.
  2. A timeframe is associated to the goal. Example: Increase sales by 15 percent in six months vs. the same six months last year.
  3. Your goal is realistic. Can you really increase sales by 15 percent? If your goal doesn’t mesh with your historical performance or competition, then adjust.

When you put these three together you may have a goal such as: “Increase sales by 5 percent in six months vs. the same 6-month period last year.”

The next piece of they pyramid is Tactics.

Because you’ve already defined your customer persona, you want to understand how they use their mobile devices. Knowing how each persona uses their mobile devices will lead you to your tactics.

These new mobile personas will offer you the right mix of tactics to generate the most reach and engagement with your customers.

Making our way up the pyramid, we have Integration.

Ultimately, you need to promote your mobile initiatives via other marketing channels. Mobile is the most dependent channel that exists.

Review your media channels and promotional calendars and make sure you have mobile call to actions throughout your media.

Lastly, you need to consider CRM.

This is the most difficult part for marketers today, as most use separate systems. But your goal is to combine all your data from all media channels and create highly targeted messaging campaigns.

Collecting this data throughout the customer journey means you can learn what areas convert the best for each and every customer.

This ends up with you being able to send the right message to the right customer at the right time.

Now it’s on you.

If you are just getting started with mobile, you should complete the pyramid for your own business. Don’t jump right into the tactics as, although it may work in the short-term, you will likely fail in the long run.

So how are you getting started?

Getting Started With Email Segmentation

Creating effective email connections that drive response and revenue requires segmentation. That sounds fine in concept, as many marketers know they need to do more segmentation in order to engage subscribers and break through the clutter. However, many marketers struggle with getting access to data and developing creative approaches that match the customer lifecycle. I urge you to not be intimidated. Demand greater data integration and access from your vendors. Start testing new content and creative approaches so that you can be automated and fully functioning immediately.

Creating effective email connections that drive response and revenue requires segmentation. That sounds fine in concept, as many marketers know they need to do more segmentation in order to engage subscribers and break through the clutter. However, many marketers struggle with getting access to data and developing creative approaches that match the customer lifecycle. I urge you to not be intimidated. Demand greater data integration and access from your vendors. Start testing new content and creative approaches so that you can be automated and fully functioning immediately.

Ease into segmentation to avoid overtaxing your precious resources. Use early tests to learn about subscriber interests and understand key success metrics. Doing so will build your confidence and help you make a case for automation, data integration and creative services — all of which are essential for advanced segmentation and better results.

There are two ways to get your arms around your segmentation opportunity, both with the goal of “right message, right person, right time.”

  1. Segment by customer profile and craft messages around customer demographics, firmagraphics and behavior.
  2. Segment by customer life stage and speak to customers who are in specific life stages.

Customer profile segmentation: With profile approaches, even simple segmentation can make a big difference. Separate your file into large segments that distinguish subscribers by a factor that has significance to your business. Clickers are a good place to start. Those subscribers who have clicked on something in the past month are more likely to be engaged than those who haven’t.

You can do less storytelling with clickers. For example, a retailer may simply alert clickers that a sale continues until Friday or put in specific sale prices for pants, sweaters and scarves. A business software marketer may send clickers three of their most popular whitepapers or an invitation to participate in a LinkedIn community. In both cases, clickers need less background info and more options to get them to act, whereas nonclickers may need more guidance and education prior to taking action.

Why burden clickers with info they don’t need and that gets in the way of their actions? At the same time, don’t skimp on critical storytelling information for nonclickers, as they clearly don’t have a strong connection with your offer yet.

Other starter segments worth testing include new subscribers versus long-time subscribers, buyers, geography (e.g., north versus south) and gender.

Draw segment lines around key drivers for your business — i.e., differentiators that give you a clear path to a custom message that will make an impact. For many B-to-B marketers, the most important driver of customization is job title. For B-to-C retailers, the key data point is most recent purchase. Don’t choose geography if location has no bearing on purchase behavior. Your business is unique, but good marketers understand the key customer attributes that lead to increased sales and satisfaction. Focus there for your segmentation and you’ll be rewarded with the biggest lift.

Life stage segmentation: To effectively segment by life stage, first abandon the notion that every email program has to be a long-term affair. Short-term email conversations can be even more powerful, particularly because they address a specific need at the time when that need is most acute. A four-message reminder series that disrupts the messaging flow around renewal time can be much more powerful than a generic newsletter which comes like clockwork every two weeks. Why not replace the newsletter with custom messaging for all customers who are up for renewal in a particular quarter? Similarly, create custom series of two messages to 20 messages that cluster around that particular life stage.

Remember to think through the dialog of the conversation if the message series is longer than three messages so that you can intensify, cease or adapt the message stream to accommodate response. For example, stop pitching the purchase midstream if someone has already upgraded from a free trial.

Not every email program has to be long term. The goal of “right message, right person, right time” can be achieved through segmentation that focuses on a specific life stage as well as customer profile.

What are your biggest challenges when it comes to nurturing engagement via segmentation strategies? Perhaps I can address them in a future blog or learn from others handling of them.