Don’t Blame Personalization After Messing It Up

In late 2019, Gartner predicted “80% of marketers who have invested in personalization efforts will abandon them by 2025 because of lack of ROI, the peril of customer data, or both.” But before giving up because the first few rounds didn’t pay off, shouldn’t marketers stop and think about what could have gone wrong?

In late 2019, Gartner predicted “80% of marketers who have invested in personalization efforts will abandon them by 2025 because of lack of ROI, the peril of customer data, or both.” Interesting that I started my last article quoting only about 20% of analytics works are properly applied to businesses. What is this, some 80/20 hell for marketers?

Nonetheless, the stat that I shared here begs for further questioning, especially the ROI part. Why do so many marketers think that ROI isn’t there? Simply, ROI doesn’t look good when:

  1. You invested too much money (the denominator of the ROI equation), and
  2. The investment didn’t pay off (the numerator of the same).

Many companies must have spent large sums of money on teams of specialists and service providers, data platforms featuring customer 360, personalization software (on the delivery side), analytics work for developing segments and personas, third-party data, plus the maintenance cost of it all. To justify the cost, some marginal improvements here and there wouldn’t cut it.

Then, there are attribution challenges even when there are returns. Allocating credit among all the things that marketers do isn’t very simple, especially in multichannel environments. To knock CEOs and CFOs off their chairs – basically the bottom-line people, not math or data geeks – the “credited” results should look pretty darn good. Nothing succeeds like success.

After all, isn’t that why marketers jumped onto this personalization bandwagon in the first place? For some big payoff? Wasn’t it routinely quoted that, when done right, 1:1 personalization efforts could pay off 20 times over the investment?

Alas, the key phrase here was “when done right,” while most were fixated on the dollar signs. Furthermore, personalization is a team sport, and it’s a long-term game.  You will never see that 20x return just because you bought some personalization engine and turned the default setting on.

If history taught us anything, any game that could pay off so well can’t be that simple. There are lots of in-between steps that could go wrong. Too bad that yet another buzzword is about to go down as a failure, when marketers didn’t play the game right and the word was heavily abused.

But before giving it all up just because the first few rounds didn’t pay off so well, shouldn’t marketers stop and think about what could have gone so wrong with their personalization efforts?

Most Personalization Efforts Are Reactive

If you look at so-called “personalized” messages from the customer’s point of view, most of them are just annoying. You’d say, “Are they trying to annoy me personally?”

Unfortunately, successful personalization efforts of the present day is more about pushing products to customers, as in “If you bought this, you must want that too!” When you treat your customers as mere extensions of their last purchase, it doesn’t look very personal, does it?

Ok, I know that I coveted some expensive electric guitars last time I visited a site, but must I get reminded of that visit every little turn I make on the web, even “outside” the site in question?

I am the sum of many other behaviors and interests – and you have all the clues in your database – not a hollow representation of the last click or the last purchase.  In my opinion, such one-dimensional personalization efforts ruined the term.

Personalization must be about the person, not product, brands, or channels.

Personalization Tactics Are Often Done Sporadically, Not Consistently

Reactive personalization can only be done when there is a trigger, such as someone visiting a site, browsing an item for a while, putting it in a basket without checking out, clicking some link, etc. Other than the annoyance factor I’ve already mentioned, such reactive personalization is quite limited in scale. Basically, you can’t do a damn thing if there is no trigger data coming in.

The result? You end up annoying the heck out of the poor souls who left any trail – not the vast majority for sure – and leave the rest outside the personalization universe.

Now, a 1:1 marketing effort is a number’s game. If you don’t have a large base to reach, you cannot make significant differences even with a great response rate.

So, how would you get out of that “known-data-only” trap? Venture into the worlds of “unknowns,” and convert them into “high potential opportunities” using modeling techniques. We may not know for sure if a particular target is interested in purchasing high-end home electronics, but we can certainly calculate the probability of it using all the data that we have on him.

This practice alone will increase the target base from a few percentage points to 100% coverage, as model scores can be put on every record. Now you can consistently personalize messages at a much larger scale. That will certainly help with your bottom-line, as more will see your personalized messages in the first place.

But It’s Too Creepy

Privacy concerns are for real. Many consumers are scared of know-it-all marketers, on top of being annoyed by incessant bombardments of impersonal messages; yet another undesirable side effect of heavy reliance on “known” data. Because to know for sure, you have to monitor every breath they take and every move they make.

Now, there is another added bonus of sharing data in the form of model scores. Even the most aggressive users (i.e., marketers) wouldn’t act like they actually “know” the target when all they have is a probability. When the information is given to them, like “This target is 70% likely to be interested in children’s education products,” no one would come out and say “I know you are interested in children’s education products. So, buy this!”

The key in modern day marketing is a gentle nudge, not a hard sell. Build many personas – because consumers are interested in many different things – and kindly usher them to categories that they are “highly likely” to be interested in.

Too Many Initiatives Are Set on Auto-Pilot

People can smell machines from miles away. I think humans will be able to smell the coldness of a machine even when most AIs will have passed the famous Turing Test (Definition: a test of a machine’s ability to exhibit intelligent behavior equivalent to, or indistinguishable from, that of a human).

In the present day, detecting a machine pushing particular products is even easier than detecting a call-center operator sitting in a foreign country (not that there is anything wrong about that).

On top of that, machines are only as versatile as we set them up to be. So, don’t fall for some sales pitch that a machine can automatically personalize every message utilizing all available data. You may end up with some rudimentary personalization efforts barely superior to basic collaborative filtering, mindlessly listing all related products to what the target just clicked, viewed, or purchased.

Such efforts, of course, would be better than nothing.  For some time.  But remember that the goal is to “wow” your target customers and your bosses. Do not settle for some default settings of campaign or analytics toolsets.

Important Factors Are Ignored

When most investments are sunk in platforms, engines, and toolsets, only a little are left for tweaking, maintenance, and expansion. As all businesses are unique (even in similar industries), the last mile effort for custom fitting often makes or breaks the project. At times, unfortunately, even big items such as analytics and content libraries for digital asset management get to be ignored.

Even through a state-of-the-art AI engine, refined data works better than raw data. Your personalization efforts will fail if there aren’t enough digital assets to rotate through, even with a long list of personas and segments for everyone in the database. Basically, can you show different contents for different personas at different occasions through different media?

Data, analytics, contents, and display technologies must work harmoniously for high level personalization to work.

So What Now?

It would be a real shame if marketers hastily move away from personalization efforts when sophistication level is still elementary for the most.

Maybe we need a new word to describe the effort to pamper customers with suitable products, services and offers. Regardless of what we would call it, staying relevant to your customer is not just an option anymore. Because if you don’t, your message will categorically be dismissed as yet another annoying marketing message.

 

Influencer Marketing Can Have Great ROI and You can Prove It

In my previous post, I discussed how influencer marketing will become a prominent marketing tactic in 2020. In this post, I would like to share what is working and what influencer marketing needs to do to become a trusted channel.

In my previous post, I discussed how influencer marketing will become a prominent marketing tactic in 2020. In this post, I would like to share what is working and what influencer marketing needs to do to become a trusted channel.

Designing an effective influencer-based campaign must take into account the objectives of the campaign, whether it is a product or service, and the length of the product purchase cycle. As a result, execution varies. However, a clear consensus is emerging that the most successful campaigns focus on co-developing content, where the influencers are given the flexibility to determine the right way to introduce their audience to the sponsor’s brand. In these instances, brands work with influencers to design content that interacts with their product or service in an entertaining or informative way. When done well, the influencer’s credibility transfers onto the sponsor’s brand. A great discussion on this can be found on Scott Guthrie’s podcast.

A Successful Influencer Marketing Campaign

One example of an influencer campaign that I really love is the Liquid- Plumr “Will it clog” campaign. In this campaign, Liquid-Plumr worked with Vat19 to create funny and interesting clogs for Liquid-Plumr to tackle, like a pile of gummy bears. For Vat19’s audience, this was completely aligned with their theme of creating entertaining experiments. For Liquid-Plumr, not only was it great brand exposure, but it also built significant brand trust among viewers. As the challenges became more and more insane, viewers were impressed with how effective the product was at tackling tough clogs. I recently had the opportunity to hear Bryan Clurman, brand manager for Liquid-Plumr, share the team’s experience, and the lift in sales he showed was impressive.

I assume Liquid-Plumr detected the increase in sales because it was an impressive viral campaign lifting historically flat sales. In this aspect, this case is atypical. Many influencer campaigns are effective, but struggle to show it. Ask a typical marketer working on influencer campaigns and they will confess their most pressing challenge is measuring impact. Currently, most common attribution metrics rely on the same pixel/cookie-based tracking that has been used for digital ads over the last two decades. While this method has some clear benefits, we also know that there is usually a non-trivial gap between actual impact and that which can be directly attributed using cookies. (Let’s forget, for the moment, that the industry-wide death of cookies has already begun.) In my experience, this gap increases with longer sales cycles or when driving brand recognition is the primary goal, as opposed to immediate sales. The further the sale is from the ad exposure, the greater the chance that direct attribution will be lost.

The Magic of the Middle Funnel

An important part of the total ROI solution lies in the middle of the sales funnel. Activities here are closer to the initial ad/brand exposure. For example, assume you are looking for a washing machine for a new home, where your actual purchase may not happen for weeks. While conducting research, you come across a recommendation from a trusted influencer. You interact with the content and may click on a link to the brand website. There, you might look at reviews and product features, but you are still not ready to purchase. These engagement activities have economic value. We know this, because as engagement with a brand increases, sales should increase. However, middle of the funnel measurement is often neglected.

While paying more attention to middle funnel metrics is one step, the other is generating more compelling middle funnel activities. If an effective influencer campaign leads to a clickthrough, can the brand extend that co-branded experience on its own digital property? Not only will that cobranded experience keep the viewer engaged, it is also great for ROI tracking. Even if pixel tracking is lost at this stage, a statistical algorithm can now be employed to correlate the increase in co-branded engagement with eventual sales.

The truth of the matter is, influencer marketing does not have a measurement challenge. Influencer marketing ALSO has a measurement challenge.

What that means is there is nothing uniquely perplexing about influencer marketing ROI. However, influencer marketing is still very new and therefore, the burden of proof is higher. As with all successful marketing ROI plans, it requires a focused approach that clearly defines the objectives and actively seeks opportunities to encourage measurable engagement.

Social Responsibility New Trend — Marketers Need to Prepare

Social responsibility is the new trend, and marketers need to prepare. I will confess that until recently, the North Star of my professional journey has been growing shareholder value.

Social responsibility is the new trend, and marketers need to prepare. I will confess that until recently, the North Star of my professional journey has been growing shareholder value. On the positive, this prime directive has allowed strange bedfellows to conduct business across ideological, racial, and political lines. In many cases, the drive to grow shareholder returns has broken barriers where cultural change was still trailing. It has also simplified objectives and brought clarity in critical business decisions.

But there seem to be some noticeable cracks developing in the shareholder value model. After all, what good is wealth in a world with growing income disparity (revolution, anyone?), polluted oceans, record heat waves and social isolation? The more we read about current events; the more doomsday prepping seems like a sane activity.

Recently, the Business Roundtable, a grouping of 192 large company CEOs declared that business should take a broader view of who they serve, beyond customers and shareholders, and include employees, suppliers and the communities they operate in. (Before you get overly excited, comrade, let’s not forget that CEO compensation is still primarily liked to profitable growth and stock value.) Nevertheless, businesses are starting to make changes.

Marriott, along with other large hotel chains, is announcing a transition away from single-use plastic toiletry bottles. We have also seen employee pay or benefits increases at Amazon, Walmart, and Target. There are also companies, like Nike and Patagonia, who are taking social stands in very visible ways. For some companies, social responsibility has been a part of their DNA for any years; for others, it is now becoming an existential imperative.

As a result, the statement from the Business Roundtable is not visionary thinking; rather, it is an acceptance of growing consumer discontent. There is a change in the zeitgeist, driven by consumers and citizens, against business as usual.

As marketers, this might feel liberating. We can finally be free of the oppressive “bean counters” who lorded the principle of shareholder value over every creative idea. No, no, we can’t. The marketer’s job has actually gotten harder and even more metrics-based.

While calculating metrics, such as cost per click, costs per conversion have become routine for most marketers, the measurement of marketing and experience decisions will become more complex. Take the simple example of eliminating plastic shampoo bottles in hotels. The ROI of this decision is not just about plastic bottle costs. For some hotel brands, toiletries are an important touchpoint in delivering a premium experience.

  • Does a bulk shampoo dispenser convey the same premium experience?
  • Are there better alternatives and what are their costs?
  • How will it impact brand positioning?
  • Does the average consumer understand the change, and will they see it as a benefit or a loss?

The recommendation from the Business Roundtable will require a business to think more holistically about how they derive profitable growth, but the drive for profitability is not going away. Marketers will now need to speak for more than just the customer and justify the costs of making socially responsible decisions. In some cases, the customer will not be a direct beneficiary of business decisions. Rather, they will be a partner who is asked to pay more or get less in the interest of the “greater good.”

The “easy” news is that customers are asking for these changes. The “tough” news is that profits still matter, and balancing that with the needs of customers and the society at large will be a more complex equation.

The Google Ads Budget Formula and a Metric to Help You Beat Your Competitors

Struggling to calculate your Google Ads budget? Learn a quick formula to use when you’re just getting started and also learn the most important metric to gain a competitive advantage.

Google Ads have helped many businesses thrive because of their power in generating leads and sales. The problem is that this power can be difficult to navigate, which has left some businesses on the sidelines wondering why they didn’t see results.

The topic of how much to spend is one that is tossed around among users and professionals, alike. The answer depends on how well you run your ad campaigns.

Budget for New Google Ads Campaigns

When you first use Google Ads, limit your budget. At this point, you do not know which keywords, ads or landing pages will be most effective, so you need to test different strategies. Because some of the money will be lost, you don’t want to waste too much.

The goal during this stage isn’t to make a huge profit. It’s to either make a small profit, break even or only lose some money. Your mindset should be that you’re investing in market research for a much more successful future with Google Ads.

Limiting your budget is a bit arbitrary. Simple math can give you a concrete amount for a budget.

Multiply the estimated cost per click of each keyword you want to test by a minimum of 100 to 200 clicks. This will ensure you’re giving each keyword a fair test. For instance, if you are testing 10 keywords with a cost per click of $1, you should consider having a budget of $1,000 to $2,000.

Growing Out of the Budget

You will know when you’re out of the testing phase when profits exceed your budget. This is the sign that tells you to abandon the budget.

Yes, you read that right — no budget.

It’s not about how much you spend on Google Ads — it’s about how much return on investment (ROI) you’re get from it.

Think about it for a minute. If you’re making $2, $3 or $4 off a $1 investment, why would you want to cap that? That’s success right there, and you might as well run with it.

Switching From CPC to EPC

Too many people focus on the cost per click of their keywords when they really should be paying attention to their earnings per click (EPC). If you have the highest earnings per click vs. your competitors, then you know you can outbid them to gain more clicks, more leads and more customers.

So, how do you calculate your EPC? All you have to do is multiply your conversion rate (the percentage of people who become paying customers) by your customer value (the amount of money you earn from that customer).

To understand this better, let’s say one customer generates $500 for you. If your conversion rate is 1%, then your earnings per click is $5. This is your golden number. Keywords with a CPC less than $5 will be profitable if your conversion rate remains 1%.

With this in mind, it’s important to note that increasing your EPC is the best way to compete in Google Ads.

The cost per click for your target keywords is not likely going to go down … In fact, there’s a good chance you’ll need to pay more per click in the coming months and years. That means your EPC is your biggest competitive advantage.

Conclusion

You know that spending a lot of money on Google Ads isn’t what produces results. Ad campaigns need to be run effectively and a budget needs to be used in a way that helps identify what works best in your market. Once that information reveals itself, removing the budget (if possible) and focusing on ROI is the best decision, moving forward.

And remember, the business with the highest EPC has the advantage in Google Ads.

Want more tips to improve your Google Ads campaigns?  Click here to grab a copy of our “Ultimate Google Ads Checklist.”

 

When Marketing’s Not Working, Stop Trying So Hard

We see it all of the time. The most talented athletes who kill all records and expectations in their sport. During training. But when it comes to delivering during a high-pressure, high-stakes competition, they go cold, stiff and can’t come close to the potential they have shown sans pressure. When marketing’s not working, the story’s often the same as it is for athletes.

We see it all of the time. The most talented athletes who kill all records and expectations in their sport. During training. But when it comes to delivering during a high-pressure, high-stakes competition, they go cold, stiff, and can’t come close to the potential they have shown sans pressure. When marketing’s not working, the story’s often the same as it is for athletes.

As a mom of three elite ski racers, I’ve seen it for years — among athletes young and old. And when it happens, its labeled as “over-thinking” that gets in the way of a relaxed performance driven by passion and not results. In fact, the old adage in the ski racing industry is, “Focus on results, be disappointed. Focus on passion, be happily surprised.”

If focusing on passion vs. results can pay big dividends in sports performance, can it do the same for marketing?

Think about it. Marketers are rushing to push out more content, more emails, more ads — and we work long hard hours to do this faster and better than everyone else. And then so often we sit back to watch the results, and end up disappointed or even stunned at the lack of response, even from our best customers. This tends to be the pattern more often than not.

Yet, when we launch campaigns that do not follow the rules of skills, tactics and techniques we have learned over the years, and just let go of the boundaries and set loose our passion for our brand, category or the purpose our products enable us to fulfill, we quite often experience something very different: customer engagement, response and ROI levels that exceed even our basic expectations. Much like when an athlete quits thinking of results and plays his/her game for the love of it instead of the glory, marketers quite often achieve personal bests.

Take a look at the brands that are more movements than profit centers:

  • Tom’s Shoes is one of the pioneer brands in this area. Instead of organizing and operating to make rich shareholders richer, founder Blake Mycoskie started an organization to put shoes on the feet of children living in poverty in third-world countries in which he had volunteered. His business reached $23 million in revenue in just three years, because his mission and his passion were contagious. That made his product that much more attractive, even when it was priced well over the cost of goods equation.
  • Another great example is Newman’s Own, a line of natural food products from which all profits are donated to charity. Its mission is “Newman’s Own Foundation uses the power of giving to help transform lives and nourish the common good.” And since starting in 1982, it has donated more than $530 million to charity. Giving back was a passion of founder, Paul Newman, whose personal mantra was, “What could be better than to hold your hand out to those who are less fortunate?” His products are top sellers at grocery stores nationwide, because they are good, and because the company creates good — both of which are contagious and inspire people to engage or purchase time and time again.

While many might call the above brand examples cause-related marketing models, others might join me in calling it Passion Marketing, which I define as: Building products and business models around a cause about which you are passionate, and working hard to engage others in your cause in order to make a powerful contact.

Like the athletes or performers who operate for the joy of doing what they love, and the passion to share their talents or gifts with others, when brands operate toward this higher purpose, they do better. Achieve more. And attract more people to their tribe, based upon like values and goals.

At some point, you — the business owner, marketing executive, operations lead — need to ask yourself a key question: Why do you do what you do? What about your job gives you joy? And why should others join your cause?

If you still have passion for what you do, your product, your brand, shift your focus and efforts to passing forward the joy you receive vs. the profits you are expected to increase.

If you are not getting the results you want. Stop trying so hard. Chances are, you’re over-thinking and not communicating with contagious passion or sharing the joy that keeps you doing what you do. Like the athlete, your efforts could be so routinized that they are just stiff and ineffective, even at the most basic level.

Instead, build campaigns around furthering the cause that you’ve aligned with your brand, and building a community around your cause that makes people want to be part of your brand. When you can do this, like Tom’s did with his mantra to give a pair of shoes away for every pair he sold, you will surprisingly see your profits grow in ways that routine, expected marketing efforts never will.

10 Tips Judging Marketing Awards Allow Me to Teach Brands

I’m judging marketing awards during the dog days of August, with steaming heat in New York City. It’s been a challenge this week choosing which campaigns will win recognition on Oct. 7 in Las Vegas. Earning my vote takes some doing. Here’s how marketers did it.

I’m judging marketing awards during the dog days of August, with steaming heat in New York City. There’s no better time than now to gather 100 or more data-driven marketing storytellers, strategists and creatives to judge this year’s Data and Marketing Association’s International ECHO Awards. (DMA is now a division of Association of National Advertisers).

It’s been a challenge this week choosing which campaigns will win recognition on Oct. 7 in Las Vegas. Earning my vote takes some doing.

Why?

1. Measurement Matters. Great creativity abounds. Yet, what matters to most CMOs is defining what business objective is achieved or surpassed through any campaign. If strategy and creative are stellar, but results toward an objective are nebulous or not addressed at all, then I’m going to discount the campaign’s overall score.
2. Talking to the Category Matters. Many award shows allow an entry to be submitted in more than one category. In that regard, ECHOs are no different. But just don’t check a box when entering. Instead, tailor the single entry campaign description to address in a meaningful way all the categories that are checked. For example, if “customer acquisition” is one of the checked categories speak to customer acquisition in the strategy and results. Show how the creative makes it easy for the customer to engage.
3. Creative Matters All of the Creative. I love a good video that summarizes a campaign entry it’s helpful for the judges in a pinch. But don’t solely rely on the video as a surrogate for showing all of a campaign’s creative elements. Judges don’t want to read or hear about a direct mail piece they want to see the actual direct mail piece (or PDF). Likewise, the mobile app, the landing page, the display ads and so on. Don’t leave a judge guessing which components worked and which may not have.
4. Set a Stage for Strategy. Open with a pain point, an opportunity statement, or some salient market research. Provide the context for the entry with a candid discussion you’ll get rewarded for brutal honesty. If a prior campaign flunked and this marked a turnaround, then say so. We’ve all been there. On the other hand, if a new campaign establishes a new control, hallelujah!
5. Let’s Get Technical. And Let Me Hear Your Data Talk. ECHOs are all about data-inspired creative and accountability. Tell me the customer and prospect data integration story the tech platforms, the analytics, and the personalization techniques. I get high when the love for strategy shows in the data discussion and how that strategy shapes creative and gets validated in results.
6. Make America Great Again … No, Not That One. Courageous clients and out-of-the-box thinking seem to co-thrive in many, many places around the globe. Because I don’t know who will be named ECHO winners this year I can only say from prior years that some innovative strategies are in play … petroleum made from beer:

Empowered sick kids:

https://youtu.be/DbRS9NxgWBU

And an 800 number answered by a nation’s citizens:

There are many well-executed U.S.-based campaigns with solid results but that extra magical mojo still seems to be shaken, not stirred in cocktails elsewhere. Bring it back home. Be a risk-taker. Let’s get the U.S. Navy more cryptologists.
7. What Was the Budget (Range)? Judges scratch their heads when key elements used to determine return on (marketing) investment are absent, or when no ROI or cost data are shared at all. No one expects proprietary information to be disclosed but there are ways to convey cost or ROI data (cost per acquisition, cost per conversion, cost improvement) in ways that are indexed or objective specific. Judges love understanding if and when campaigns truly break even.
8. Proofread and Check Your Math. I’m one of those people who shudders when The New York Times or New Yorker has a spelling or usage error. (You’d think I’d live my own life mistake-free, well hardly.) I can’t be the only stickler left on this planet, am I? In the rush to get entries in the door ahead of deadlines, errors do get through sometimes slight, but sometimes it’s more substantial “engagement” math off by a power of ten! No wonder the return on investment was so good … or was it?
9. Camaraderie and Conversation Among Peers Are Really Cool. When you judge Round 1 (online and alone), you get to see clever campaigns and a store of ideas to apply in your own marketing. When you are lucky to be chosen to judge Round 2 (face-to-face in New York), wow! You still cast your votes alone but only after a lively discussion, debate and worldwide reality check. It’s an 8-hour day (or three in a row), but with plenty of meal-time and after-hour networking, too. It’s a true marketing exchange and the points of view are well-articulated. Discussions open eyes and minds.
10. Awards Matter, as Do the Entries. There will be Gold, Silver, Bronze and Finalist ECHOs named plus a Diamond ECHO for top campaign overall. Still, there was at least one great idea in nearly every individual entry I saw.

Collectively, I also saw something else, which too often gets overlooked and underappreciated. Advertising and today, that also means the data that fuels it may seem to serve brands. And it does. But this week while judging marketing awards I saw a lot more. Advertising (and data) also creates customers. It creates commerce. It moves markets. It creates and serves audiences. It informs. It finances. It employs. It empowers. It inspires. Advertising is essential, yet we cannot take any of it for granted. Awards call attention to great work, by great people, achieving spectacular returns and those extend way beyond the brand. It’s good to be a judge.

Improved Marketing ROI Shouldn’t Be Your Metric, This Should

My team often engages in client projects designed to improve marketing outcomes. Many times, clients describe their primary objective as an increased return on marketing dollars or return on investment (ROI). However, this is often the wrong object and their real goal should be improved marketing effectiveness.

My team often engages in client projects designed to improve marketing outcomes. Many times, clients describe their primary objective as an increased return on marketing dollars or return on investment (ROI). However, this is often the wrong object and their real goal should be improved marketing effectiveness.

“That sounds like semantics,” you say? Yes, this is an argument over semantics, and in this case, semantics matter.

When stating the primary objective as improved marketing ROI, the aperture is usually focused on an optimization exercise, which pits financial resources on one side of the equation and levers — such as channel spend, targeting algorithms and A/B testing — on the other side.

A couple of decades ago, marketing analytics recognized that specific activities were easier to link, with outcomes based on data that was readily available. Over time, this became the marketing ROI playbook and was popularized by consultants, academics and practitioners. This led to improved targeting, ad buys and ad content. These improvements are very important, and I would argue that they are still a must-do for most marketing departments today. However, resources are optimally allocated across channels, winning ads identified and targeting algorithms improved, marketing is still not as effective as it can be. Now is when the hard part of building a more effective marketing function actually begins.

For a moment, let’s imagine a typical marketing ROI project from the customer’s perspective. Imagine you are actively shopping for a refrigerator. A retailer uses data to appropriately target you at the right time, across multiple channels, with the right banner ad and a purchase naturally follows, right? Of course not.

  • What about helping you understand the variety of features, prices and brands available?
  • What about helping you understand the value of selecting them over other retailers?
  • What about the brand affinity and trust this process is developing in the consumer’s mind?

Because this purchase journey can play out over weeks or months, these marketing activities are more difficult (but not impossible) to measure and are often left out of the standard ROI project. However, these activities are as impactful as the finely tuned targeting algorithm that brought you to the retailer’s website in the first place.

Back to why semantics over ROI and marketing effectiveness matter. Today, the term “marketing ROI” is calcified within a relatively narrow set of analytical exercises. I have found that using marketing effectiveness as the alternative objective gives license to a broader conversation about how to improve marketing and customer interaction. It also lessens the imperative to link all activities directly to sales. Campaigns designed to inform, develop relationships or assist in eventual purchase decisions are then able to be measured against more appropriate intermediate metrics, such as online activity, repeat visits, downloads, sign-ups, etc.

What makes this work more challenging is that it requires marketers to develop a purposeful and measurable purchase journey. In addition, it requires a clear analytics plan, which drives and captures specific customer behavior, identifies an immediate need and provides a solution so the customer can move further down the purchase journey.

Finally, it requires developing an understanding of how these intermediate interactions and metrics eventually build up to a holistic view of marketing effectiveness. Until marketers can develop an analytical framework which provides a comprehensive perspective of all marketing activity, marketing ROI is merely a game of finding more customers, at the right time and place who will overlook a poorly measured (and, by extension, poorly managed) purchase journey.

Tapping the Psychology of Fun for Sales and ROI

Tapping the psychology of fun for sales and ROI takes work, because sometimes we marketers are so close to the trees, we can’t see the forest. Such is often the case with building customer experiences and journeys. It’s easy to download the latest template for mapping out each response to potential questions or needs along the customers pathway to “yes” and lifetime loyalty. And while that is critical for maintaining consistent touchpoints with a brand, it’s not where customer experience stops — or starts, for that matter.

Tapping the psychology of fun for sales and ROI takes work, because sometimes we marketers are so close to the trees, we can’t see the forest. Such is often the case with building customer experiences and journeys. It’s easy to download the latest template for mapping out each response to potential questions or needs along the customers pathway to “yes” and lifetime loyalty. And while that is critical for maintaining consistent touchpoints with a brand, it’s not where customer experience stops — or starts, for that matter.

Consumers are drawn to brands that make them smile, giggle or feel something beyond the routine by surprising them with creative experiences beyond any expectations. It’s not just experiences — like Apple’s Genius Bar and concierge style of selling — it’s little things that truly are delightful, fun and memorable. And its these little things that have a big impact.

Consider something as simple as this:

Every year, the charming town of Frisco, Colo., holds it annual BBQ challenge — featuring dozens of chefs, all competing for the People’s Choice award for best BBQ dish served. Most restauranteurs roll their retail trailers onto Main Street and set up their mobile kitchens in hopes of luring the crowd and getting votes for best brisket, ribs, pork and more. And to all the thousands of visitors roaming the streets for tasting and fun, they all look and smell the same. Except for one: The Golden Toad.

psychology of fun: golden toad
Credit: Jeanette McMurtry

Rather than just set up a food station and hope a colorful trailer and fun logo draw the crowds, the Golden Toad cooks up a crowd by making its food station about fun — not just food. Throughout the event, employees play fun, energizing music from their cook station, which is set up like a stage so people can see their chefs at work. And throughout each day, those same chefs take to the streets, playing air band with guitar-size spatulas, rallying attention — which quickly results in the longest line of all. They engage the crowd in their fun, too. They hand out those supersized grill spatulas to young kids and invite them to join their jam, sharing the fun and delighting parents who get to see their kids doing something beyond the routine, too. Its fun. Its contagious and it drives sales volume and People’s Choice votes, earning them this coveted honor many times over.

psychology of fun: Golden Toad's long lines
Credit: Jeanette McMurtry

Golden Toad doesn’t stop there, either. Once its attention-grabbing dance band draws a crowd for the performance and the food line, the commitment to making the customer experience positive and entertaining continues at a place most marketers neglect: the line for products or services. It’s no new news that we consumers are impatient and tend to abandon a purchasing mission if we get bored or antsy waiting in a long line. Golden Toad owners, “Toad” and Sara Jilbert counter this very real issue by installing a TV camera in their trailer, next to the cashiers, tuned strategically to whatever local sports are in play at the time. As a result, Golden Toad minimizes line abandonment from the consumers it drew with its fun, entertaining experience.

The psychology of fun and entertainment is real and needs to be front-and-center in all customer experiences for all brands. Wikipedia’s definition of “fun” includes the following insights:

“Fun is an experience often unexpected, informal or purposeless. It is an enjoyable distraction, diverting the mind and body from any serious task or contributing an extra dimension to it.”

We consumers live stressful lives. We need diversions from the stress of daily routines and the stress of shopping; especially when there are many choices to make, such as a huge BBQ challenge that lines several blocks on Main Street, USA. Little things that entertain and free our minds of routine energy and help ease our choices through fun diversions work. They work for all brands and in all industries. And they can work for you. All it takes is some imagination. Volkswagen, a few years ago, created a series of experiments and corresponding videos, called The Fun Theory. showing how behavior is changed for the better by adding fun to routine activities, such as choosing stairs over an escalator and using a bottle recycling station over a landfill-bound trash can. For example, by turning stairs into a musical keyboard, there was a 60% increase in usage.

Imagine if you could make your online or retail store shopping experience more fun and increase shopping transactions by 60%!

So change your routine. Go for a walk instead of sitting at your desk and let your mind have fun observing people around you — what draws them, what makes them stop their routine to engage and just have fun!

Technology Makes Direct Mail Irresistible

With great ROI, marketers continue to use direct mail. However, direct mail marketing that works today is vastly different than five years ago. Take a look at the pieces you are getting in the mail, they are more targeted, personalized and engaging than ever before. Technology has allowed us to increase ROI even more.

With great ROI, marketers continue to use direct mail. However, direct mail marketing that works today is vastly different than five years ago. Take a look at the pieces you are getting in the mail, they are more targeted, personalized and engaging than ever before. Technology has allowed us to increase ROI even more. By adding technology, you can draw attention to your mail piece and create a wow factor.

Here are four ways to use technology in your next direct mail campaign:

1. Sound Chips: You can add sound to your mail pieces! Record any message you want, then when your prospect or customer opens it the sound starts to play. Most people have seen this mechanism with a birthday card. Check out an example below.These are not super expensive and can increase your response rates.

2. Video: You can add video screens to your mailers. When your customer or prospect opens the mailer the screen is right there and it can either launch automatically or when they push a button. Want to see how they work? Check this out. Keep in mind that these are on the more expensive side.

3. Augmented Reality: You can have an image come to life and be manipulated by your prospects and customers with the use of your mail piece and a mobile device with an app. This is a very powerful way to engage them. Many marketers think that this is very hard to do and expensive, but it does not have to be. You can create a great user experience without breaking your budget. Check out this example. How can you create an awesome experience?

4. Data: You have so many options now to enhance your data or just take advantage of the data you already have. Segmenting like people together allows you in send more powerful messaging to the right people. You can profile your current customers to find prospects who are most like them. Then you take your data and create variable data mailers with targeted images, as well as copy and even design if you want to. The power of your data is only limited by you.

Technology doesn’t have to be a big budget item. You first need to plan out what you would like to do, then figure out the costs. Now you are ready to create your marketing campaign plan.You need to think strategically, starting with your goals. Creating direct mail using technology is a great driver of response when used correctly. Your best bet is to consult with your mail service provider; they will be able to help you with postal regulations and other aspects to save you money.

Keep in mind you still need to consider the basic requirements of good direct mail. A good list, an eye-catching design and a strong call to action are a must to drive response. If any of these are lacking, you will not get the response you wanted. Make sure to provide instructions on the mail piece as to how your prospects and customers can use the technology. Don’t forget to provide them with great content to view. If the content is not well designed or planned out then the whole process will be a waste of time. Are you ready to get started?

‘Killing Marketing’ to Save It

The book “Killing Marketing,” the latest from Joe Pulizzi and Robert Rose, says this: “We must kill marketing that makes a living from accessing audiences for short bursts of time so they might buy our product.”

Millennial marketing
“BMXr’s,” Creative Commons license. | Credit: Flickr by micadew

The book “Killing Marketing,” the latest from Joe Pulizzi and Robert Rose, says this: “We must kill marketing that makes a living from accessing audiences for short bursts of time so they might buy our product.”

It continues: “We must rebirth a new marketing that makes its living from building audiences for long periods of time, so that we might hold their attention through experiences that place us squarely in the initial consideration set when they are looking for a solution.

“This is the marketing of the future. It is achieving a long-term return on the one asset that will save our business: an audience.”

The book is wonderful — I highly recommend it. It’s chock-full of ideas about how to transform the marketing department from a cost center to a profit center. It details multiple ways to pull direct and indirect revenue from marketing, once true engagement with an audience has been established. In their words, it will transform your marketing into something more powerful than “the art of finding clever ways to dispose of what you make.”

But specific to the selection quoted above, for me it’s another spark of thought about the downside of personas based on demographics.

If you’re personas are demographic- lead rather than interest-led, then you’re setting yourself up for selling in short bursts of time. You’re not going to be able to establish a long-term relationship with an audience based on who they are and what they truly care about — because you simply won’t know what those things are. And you won’t create experiences that hold an audience’s attention for future consideration.

To truly build audiences for long periods of time, we need to start with interests and preferences rather than demographics.

To employ a far overused example …

Red Bull doesn’t define its audience as “Millennial males who want an energy drink.” The brand understands its audience by defining all of the facets of interests in a lifestyle of adventure — from edge (extreme) sports to music to fashion to travel and so on. And then Red Bull provides that audience with access to that lifestyle, through publications, events, social media content and more … and it sells some energy drinks, as well.

If Red Bull did the former (define a demographic), it would’ve been able to effectively place an ad for an energy drink on channels where Millennial males might be. And the brand would’ve sold some drinks, and perhaps captured some people who would continue to buy Red Bull through the years. But the brand affinity it would’ve created would’ve be thin, at best. And it’d be in a constant cycle of reloading short-term audiences. That’s a losing game.

Instead, Red Bull tilted toward the latter — personas based on interests. But … how did that happen?

Maybe the brand started with an idea like: “We see opportunity to engage the ‘extreme sports lifestyle audience regardless of age, location, etc.’ in a whole new, deeper way.” Or, perhaps Red Bull carefully observed its initial audience — the short-term customer audience it had when it first went to market with the drink — and asked questions like:

  • We see Millennial males are a big part of our initial audience, but what’s behind the demographic?
  • What commonalities does that portion of the audience share with the rest of the audience?
  • What is it that our audience — in aggregate — is telling us they care about most?
  • What information are they craving most?
  • And is anyone else providing that information? Access?

I wasn’t there, so I don’t know. And most of the stories we hear about Red Bull’s content marketing successes don’t focus on the starting point of audience understanding. But I imagine it was more along the lines of not resting on an initial, demographic-lead audience understanding. I imagine the brand had a short-term audience, but decided it didn’t want to have to constantly reload. Good for Red Bull!

Smart marketers will take note and do the same. They’ll dig deep. They won’t rest on the easy, starting answer. They’ll get past the simple, demographic personas, and they’ll start thinking about interests that transcend demographic as the path to building a long-term, engaged audience.

In short: Demographic-led personas lead to decent targeting and short-term sales. Simple ROI. Interest-led personas lead to engagement and brand affinity for the long-term: Simple ROI plus customer lifetime value.