Marketing AI Is Overhyped, and That’s Good

Today, marketing AI is a know-it-all with a short resume. Just like Big Data and personalization, it is also a catch-all phrase that is becoming harder to define. As a result, it is no surprise that most marketers are rolling their eyes at the topic. Nevertheless, this is also the time to take the topic seriously, unless you plan to retire into seclusion in the next few years.

AI
“artificial-intelligence-2228610_1920,” Creative Common license. | Credit: Flickr by Many Wonderful Artists

Today, marketing AI is a know-it-all with a short resume. Just like Big Data and personalization, it is also a catch-all phrase that is becoming harder to define. As a result, it is no surprise that most marketers are rolling their eyes at the topic. Nevertheless, this is also the time to take the topic seriously, unless you plan to retire into seclusion in the next few years.

New research by marketing automation provider Resulticks shows that 73 percent of marketers are either skeptical, neutral or simply exhausted by the hype around marketing AI. In addition, large numbers of marketers think that vendors using industry buzzwords are full of it. This is not surprising, considering how most vendors are probably over-selling their AI solution. In the same Resulticks study, only 18 percent of marketers claim that AI vendors are delivering the goods as promised and 43 percent felt they were over-promised.

However, for those of us who have lived through (and even reveled in) industry catchphrases, from “marketing analytics” to Big Data to “MarTech,” these statistics indicate that “Marketing AI” is on a strong growth trajectory. This is because the combination of huge industry-level investments and a few success stories is generally a recipe for a new frontier of innovation. Some time ago, I wrote an article on the VC investments being made in data-driven marketing technology and many of the technology solutions were still evolving innovations, like marketing automation. Today, the phrase “Marketing AI is also heading toward becoming broad and meaningless, with heavy investments in the sector. In a few years, underneath that generic umbrella will evolve smart, pragmatic solutions which will become part of the standard tool kit. For example, under the Big Data and MarTech labels, we now have well-adopted solutions, such as CRM, programmatic buying and marketing automation. While there are still bugs and varying degrees of success, there is also a large body of fruitful use-cases which demonstrate how these tools can be very effective.

So, what is a marketer to do in this environment where marketing AI has yet to evolve to a stage where it is a stable and valued marketing tool? The most important step is to set low expectations and begin to dip your feet in the water. Experimenting now is critical, as new skills sets and operating frameworks will be required to fully take advantage of the coming AI-driven innovations, and building those individual and institutional capabilities will take time.

Revisiting the Lowly Postcard

Earlier this year, I received a postcard mailing from the Share and Care Foundation, a nonprofit organization located in New Jersey. In just four panels (one of which was the address panel), the postcard tackled one of those funding needs that make many fundraisers cringe — toilets.

Earlier this year, I received a postcard mailing from the Share and Care Foundation, a nonprofit organization located in New Jersey. In just four panels (one of which was the address panel), the postcard tackled one of those funding needs that make many fundraisers cringe — toilets.

“The Toilet Crisis” was the headline on the first inside panel. The copy continued, “600 million people in India do not have access to indoor toilets,” and then explained in two bullet points that this leads to the spread of diseases and safety issues for women.

I was intrigued. After all, conventional wisdom is that postcards, lacking a response means other than going online, are not the best fundraising tool. They also offer limited space to make a case for support. Yet they are relatively inexpensive and lack the barrier of the envelope that one needs to open before seeing the contents. So, was this enough to drive people to the website to give a $130 toilet to a family in India?

I spoke to Tejal Parekh, the senior operations manager at Share and Care Foundation, and asked her, “So, did it work?” The short answer is “yes.” The foundation’s goal for the mailer was to raise enough money to build 750 toilets in 2016; it already has completed more than 500 toilets as a result of donations it’s received from the postcard and a follow-up email.

That’s worth a second look, so let’s unpack this postcard just a bit.

Measuring 8×6″, the mailer folded to 4×6″ and was double tabbed. The address panel had a live, presorted, standard-rate stamp. There was no teaser on that panel, but it did invite the recipient to sign up for updates; call or email with questions, comments or concerns; or “Please let us know if you receive duplicate mailings.” In other words, this panel was hardworking, albeit functional.

BardenPostcard1
The exterior of Share and Care Foundation’s postcard that aimed to raise money for toilets in India.

The front panel was pretty much a rule-breaker when it comes to direct response. It had artwork—a doorway that might represent the entrance to a house, but it’s not really clear because it is stylized. The headline was in all caps with a drop shadow and never mentioned “you,” the donor. Added to that, it referred to one of the least sexy of all programs: indoor toilets, and sanitation and hygiene education.

But once you opened the postcard, the story unfolded, beginning with the headline noted earlier.

Parekh explained that the young person on the marketing team who put this together for Share and Care Foundation “told the story in a few simple lines. People don’t want to see too much misery, so photos were more positive images, and there was also a simple drawing of a family. It was short, yet it told a story.”

The interior of Share & Care Foundation's postcard that aimed to raise money for toilets in India.
The interior of Share and Care Foundation’s postcard that aimed to raise money for toilets in India.

I agree. The postcard caught my attention and apparently that of others on its U.S. database—donors and prospects. As mentioned, the response was excellent. Why? According to Parekh, the offer made sense, and the price point was reasonable.

The response mechanism was to drive people to a webpage that reiterated the offer (and added more information). When one clicked the “Donate Today” button at the bottom of the page, he or she went directly to a donation page that quickly summed up the offer and asked for $130 for a toilet. There were also lower amounts, but $130 was the focus. (One change I would make would be to add the “Donate Today” button to the top of the page, as well; right now, there is a “Donate Now” button as part of the header, but when you click that, it goes to a generic donation page. That could discourage someone who just wants to give a toilet.)

One of the surprises for the foundation was that a lot of lapsed donors responded. Again, it was a clear, compelling offer (reduce disease and improve women’s safety) at an affordable price point ($130). Plus, the only barrier to reading about the offer was two tabs. The copy was minimal, the story was easily understood, and the focus was on the beneficiaries, not the organization. Plus, it offered proof—the foundation already built 350 toilets in four villages and wanted to do more.

Yes, there are some things I would l want to change on this mailer (that’s an occupational hazard), but that’s not the point; the point is that Share and Care Foundation took a risk and sent out a lowly postcard that some would argue lacks what it takes to be a serious fundraiser—and made it work. It told a story briefly and in terms “Average Pat Donor” could understand. It made it relatively easy to respond by providing a simple URL and a specific landing page. It kept its costs low.

The foundation took a risk—and it paid off. So kudos to Share and Care Foundation. And for all the rest of us, maybe it’s time to rethink the postcard. It’s worth a test, but remember Parekh’s advice: The offer and the price point need to make sense, and the story has to be simple.

Direct Mail: Data Makes All the Difference

The draw of the latest marketing trends pulls at us all. Many companies have integrated their direct mail with technologies like QR Codes, NFC and augmented reality, but many are missing the point with direct mail. The power of direct mail is the ability to reach the right person with the right offer to drive their response. Yes, technology can make the responses quicker and easier, but if you are not taking into consideration the person you are sending too, you may be throwing money away.

The draw of the latest marketing trends pulls at us all. Many companies have integrated their direct mail with technologies like QR Codes, NFC and augmented reality, but many are missing the point with direct mail. The power of direct mail is the ability to reach the right person with the right offer to drive their response. Yes, technology can make the responses quicker and easier, but if you are not taking into consideration the person you are sending too, you may be throwing money away.

The most powerful tool you have today is your data. You need to be able to harness this power to create great direct mail campaigns. Here are some things to consider:

  1. Create a data plan. What are your goals? What data have you already captured? What data do you want to capture? Now that you know what you want, how are you going to get it?
  2. Outline how you are going to use that data. Just having the data is not enough. You need to plan out ways to capitalize on it. Being able to group like people together for messaging will help you have less complicated campaigns. Make sure to not sacrifice your ROI by trying to make the campaign too simple. Some complexity is a good thing.
  3. The most common form of information that is extremely helpful in direct mail is purchase history. When you know what someone has already purchased you are able to tempt them with other items that they may be interested in, such as accessories or upgrades. This can also work in the nonprofit sector by tracking donation amounts. You can entice donors to donate more, by providing stepped donation amounts based on the last donation made.
  4. When you don’t have a lot of data already compiled there are many resources that can help you to enhance your data. There are geo, psycho, and demographics to name a few. Using this information can help you to build personas for better message targeting. Augmenting your data can provide powerful insights such as financial, shopping, technology and so much more. A couple of examples are Nielson with the Prizm tool and Accudata with the SnapShot tool. Working with a data company can help you expand your customer and prospect knowledge which can equate to better targeted marketing.
  5. Keeping old data is the biggest mistake. Outdated data is a real problem. These days the key to good data is not only capturing as much information about each person as you can, but also double checking it. Keep your data clean with all available tools. Some of these tools include NCOA (checking for new addresses when people move), deceased file processing (removing people when they die), surveys (keep your info current by asking them directly) and so on. You should look at your data as a constant work in progress and be cleaning and adding to it all the time.
  6. Do not forget about security. It is extremely important to secure your data. Too many times we hear reports of data breaches. Work with your IT department to make sure you can count on your data security. Many companies have not spent enough time on data security and have had to pay a very high price. Your customers trust you. Make sure you are trustworthy now before it is too late.
  7. If your data is small, don’t worry about it. Plan ways to grow your data base and continue to improve it. The more you are able to capture with each campaign the better your direct mail is going to get. Everyone started off small at one point. Just remember the tools you have available to help you and keep your data up to date. Old data will cost you money.

Direct mail can be an excellent driver for your marketing, not just for purchases, but for online engagement as well. When you focus on your data and really target your audience the impact of direct mail can be enormous. Tracking your campaigns is extremely important so that you know what is making you the most money and what needs to be worked on. Your direct mail should be constantly changing and updated based on your responses and data files. Have fun creating direct mail campaigns and learning more about your customers and prospects.

Cheat Sheet: Is Your Database Marketing Ready?

Many data-related projects end up as big disappointments. And, in many cases, it is because they did not have any design philosophy behind them. Because many folks are more familiar with buildings and cars than geeky databases, allow me to use them as examples here.

Many data-related projects end up as big disappointments. And, in many cases, it is because they did not have any design philosophy behind them. Because many folks are more familiar with buildings and cars than geeky databases, allow me to use them as examples here.

Imagine someone started constructing a building without a clear purpose. What is it going to be? An office building or a residence? If residential, for how many people? For a family, or for 200 college kids? Are they going to just eat and sleep in there, or are they going to engage in other activities in it? What is the budget for development and ongoing maintenance?

If someone starts building a house without answering these basic questions, well, it is safe to say that the guy who commissioned such a project is not in the right state of mind. Then again, he may be a filthy rich rock star with some crazy ideas. But let us just say that is an exceptional case. Nonetheless, surprisingly, a great many database projects start out exactly this way.

Just like a house is not just a sum of bricks, mortar and metal, a database is not just a sum of data, and there has to be design philosophy behind it. And yet, many companies think that putting all available data in one place is just good enough. Call it a movie without a director or a building without an architect; you know and I know that such a project cannot end well.

Even when a professional database designer gets involved, too often the project goes out of control—as the business requirement document ends up being a summary of
everyone’s wish lists, without any prioritization or filtering. It is a case of a movie without a director. The goal becomes something like “a database that stores all conceivable marketing, accounting and payment activities, handling both prospecting and customer relationship management through all conceivable channels, including face-to-face sales and lead management for big accounts. And it should include both domestic and international activities, and the update has to be done in real time.”

Really. Someone in that organization must have attended a database marketing conference recently to get all that listed. It might be simpler and cheaper building a 2-ton truck that flies. But before we commission something like this from the get-go, shall we discuss why the truck has to fly, too? For one, if you want real-time updates, do you have a business case for it? (As in, someone in the field must make real-time decisions with real-time data.) Or do you just fancy a large object, moving really fast?

Companies that primarily sell database tools often do not help the matter, either. Some promise that the tool sets will categorize all kinds of input data, based on some auto-generated meta-tables. (Really?) The tool will clean the data automatically. (Is it a self-cleaning oven?) The tool will establish key links (by what?), build models on its own (with what target data?), deploy campaigns (every Monday?), and conduct result analysis (with responses from all channels?).

All these capabilities sound really wonderful, but does that system set long- and short-term marketing goals for you, too? Does it understand the subtle nuances in human behaviors and intentions?

Sorry for being a skeptic here. But in such cases, I think someone watched “Star Trek” too much. I have never seen a company that does not regret spending seven figures on a tool set that was supposed to do everything. Do you wonder why? It is not because such activities cannot be automated, but because:

  1. Machines do not think for us (not quite yet); and
  2. Such a system is often very expensive, as it needs to cover all contingencies (the opposite of “goal-oriented” cheaper options).

So it becomes nearly impossible to justify the cost with incremental improvements in marketing efficiency. Even if the response rates double, all related marketing costs go down by a quarter, and revenue jumps up by 200 percent, there are not many companies that can easily justify that kind of spending.

Worse yet, imagine that you just paid 10 times more for some factory-made suit than you would have paid for a custom-made Italian suit. Since when is an automated, cookie-cutter answer more desirable than custom-tailored ones? Ever since computing and storage costs started to go down significantly, and more so in this age of Big Data that has an “everything, all the time” mentality.

But let me ask you again: Do you really have a marketing database?

Let us just say that I am a car designer. A potential customer who has been doing a lot of research on the technology front presents me with a spec for a vehicle that is as big as a tractor-trailer and as quick as a passenger car. I guess that someone really needs to move lots of stuff, really fast. Now, let us assume that it will cost about $8 million or more to build a car like that, and that estimate is without the rocket booster (ah, my heart breaks). If my business model is to take a percentage out of that budget, I would say, “Yeah sure, we can build a car like that for you. When can we start?”

But let us stop for a moment and ask why the client would “need” (not “want”) a car like that in the first place. After some user interviews and prioritization, we may collectively conclude that a fleet of full-size vans can satisfy 98 percent of the business needs, saving about $7 million. If that client absolutely and positively has to get to that extra 2 percent to satisfy every possible contingency in his business and spend that money, well, that is his prerogative, is it not? But I have to ask the business questions first before initiating that inevitable long and winding journey without a roadmap.

Knowing exactly what the database is supposed to be doing must be the starting point. Not “let’s just gather everything in one place and hope to God that some user will figure something out eventually.” Also, let’s not forget that constantly adding new goals in any phase of the project will inevitably complicate the matter and increase the cost.

Conversely, repurposing a database designed for some other goal will cause lots of troubles down the line. Yeah, sure. Is it not possible to move 100 people from A to B with a 2-seater sports car, if you are willing to make lots of quick trips and get some speeding tickets along the way? Yes, but that would not be my first recommendation. Instead, here are some real possibilities.

Databases support many different types of activities. So let us name a few:

  • Order fulfillment
  • Inventory management and accounting
  • Contact management for sales
  • Dashboard and report generation
  • Queries and selections
  • Campaign management
  • Response analysis
  • Trend analysis
  • Predictive modeling and scoring
  • Etc., etc.

The list goes on, and some of the databases may be doing fine jobs in many areas already. But can we safely call them “marketing” databases? Or are marketers simply tapping into the central data depository somehow, just making do with lots of blood, sweat and tears?

As an exercise, let me ask a few questions to see if your organization has a functioning marketing database for CRM purposes:

  • What is the average order size per year for customers with tenure of more than one year? —You may have all the transaction data, but maybe not on an individual level in order to know the average.
  • What is the number of active and dormant customers based on the last transaction date? —You will be surprised to find out that many companies do not know exactly how many customers they really have. Beep! 1 million-“ish” is not a good answer.
  • What is the average number of days between activities for each channel for each customer? —With basic transaction data summarized “properly,” this is not a difficult question to answer. But it’s very difficult if there are divisional “channel-centric” databases scattered all over.
  • What is the average number of touches through all channels that you employ before your customer reaches the projected value potential? —This is a hard one. Without all the transaction and contact history by all channels in a “closed-loop” structure, one cannot even begin to formulate an answer for this one. And the “value potential” is a result of statistical modeling, is it not?
  • What are typical gateway products, and how are they correlated to other product purchases? —This may sound like a product question, but without knowing each customer’s purchase history lined up properly with fully standardized product categories, it may take a while to figure this one out.
  • Are basic RFM data—such as dollars, transactions, dates and intervals—routinely being used in predictive models? —The answer is a firm “no,” if the statisticians are spending the majority of their time fixing the data; and “not even close,” if you are still just using RFM data for rudimentary filtering.

Now, if your answer is “Well, with some data summarization and inner/outer joins here and there—though we don’t have all transaction records from last year, and if we can get all the campaign histories from all seven vendors who managed our marketing campaigns, except for emails—maybe?”, then I am sorry to inform you that you do not have a marketing database. Even if you can eventually get to the answer if some programmer takes two weeks to draw a 7-page flow chart.

Often, I get extra comments like “But we have a relational database!” Or, “We stored every transaction for the past 10 years in Hadoop and we can retrieve any one of them in less than a second!” To these comments, I would say “Congratulations, your car has four wheels, right?”

To answer the important marketing questions, the database should be organized in a “buyer-centric” format. Going back to the database philosophy question, the fundamental design of the database changes based on its main purpose, much like the way a sports sedan and an SUV that share the same wheel base and engine end up shaped differently.

Marketing is about people. And, at the center of the marketing database, there have to be people. Every data element in the base should be “describing” those people.

Unfortunately, most relational databases are transaction-, channel- or product-centric, describing events and transactions—but not the people. Unstructured databases that are tuned primarily for massive storage and rapid retrieval may just have pieces of data all over the place, necessitating serious rearrangement to answer some of the most basic business questions.

So, the question still stands. Is your database marketing ready? Because if it is, you would have taken no time to answer my questions listed above and say: “Yeah, I got this. Anything else?”

Now, imagine the difference between marketers who get to the answers with a few clicks vs. the ones who have no clue where to begin, even when sitting on mounds of data. The difference between the two is not the size of the investment, but the design philosophy.

I just hope that you did not buy a sports car when you needed a truck.

Marketing Automation Is Not Marketing Strategy

Too often these days, I hear B-to-B marketers mouth claims like, “We got this new [fill in the brand] automation tool, so now we can reduce headcount.” Or, “Once this automation system is installed, it will take our marketing to the next level.” This worries me. Marketers sometimes see automation as a silver bullet. But it’s only a tool

Too often these days, I hear B-to-B marketers mouth claims like, “We got this new [fill in the brand] automation tool, so now we can reduce headcount.” Or, “Once this automation system is installed, it will take our marketing to the next level.” This worries me. Marketers sometimes see automation as a silver bullet. But it’s only a tool. Marketing automation doesn’t identify your best target audiences. It can’t develop value propositions. No way will it make the tough decisions among competing investment options. I’m reminded of Mike Moran’s great book title, Do It Wrong, Quickly. In other words, marketing automation doesn’t work without strategy.

Remember ten years ago, when CRM came along? Déjà vu all over again, to echo Yogi Berra. Marketers thought that the new CRM software would solve their customer service and customer retention problems. Expectations dashed. Not only was it a nightmare to get up and running, the software served only to automate the processes—good or bad—that companies already had in place.

Even the marketing automation software vendors themselves recognize the importance of strategy, for their own success, as well as that of their clients. Think about it: If their clients can’t get the value from the software, their revenues are going to be impacted.

So education campaigns are underway. Marketo, for example, sponsored a compelling study by Sirius Decisions that explains the importance of a strong process in driving results when using marketing automation software. Their data shows that companies using automation combined with a reasonable lead management process—inquiry generation, qualification, nurturing and hand off to sales—produced four times the sales volume of companies with automation but with weaker processes.

Eloqua, too, makes a strong case for strategy in its guide, “6 Pitfalls to Avoid in Your Marketing Automation Journey,” which contains the important reminder to avoid putting “too much focus on technology, and not enough focus on buyers.”

So, what should we be doing with automation, to ensure its success? Three things come to mind.

  1. Be realistic about what it can and can’t do. Automation is not a silver bullet that you can set and forget. So make sure real humans are thinking through the essential tasks of identifying your key audiences, understanding their needs, scoping out their buying processes and developing contact strategies to move them along, in your direction.
  2. Clean up your database. By now it’s clear that the database is the single most important success factor in B-to-B marketing communications. So don’t be automating messages that can’t or won’t be delivered to the right targets.
  3. Train up your team. Too many marketing groups are leaving the campaign automation system to a set of junior staffers who interface with the tools, deploy campaigns and report results. I am not saying the marketing VPs should be executing campaigns, but to get the right mix of strategy and tools, we need better integration. Senior marketers should be deeply aware of the capabilities of the software. And junior staffers need training in strategic marketing thinking.

Are there other success factors in B-to-B marketing automation you can share?

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

‘Big Data’ Is Like Mining Gold for a Watch – Gold Can’t Tell Time

It is often quoted that 2.5 quintillion bytes of data are collected each day. That surely sounds like a big number, considering 1 quintillion bytes (or exabytes, if that sounds fancier) are equal to 1 billion gigabytes. … My phone can hold about 65 gigabytes; which, by the way, means nothing to me. I just know that figure equates to about 6,000 songs, plus all my personal information, with room to spare for hundreds of photos and videos. 

It is often quoted that 2.5 quintillion bytes of data are collected each day. That surely sounds like a big number, considering 1 quintillion bytes (or exabytes, if that sounds fancier) are equal to 1 billion gigabytes. Looking back only about 20 years, I remember my beloved 386-based desktop computer had a hard drive that can barely hold 300 megabytes, which was considered to be quite large in those ancient days. Now, my phone can hold about 65 gigabytes; which, by the way, means nothing to me. I just know that figure equates to about 6,000 songs, plus all my personal information, with room to spare for hundreds of photos and videos. So how do I fathom the size of 2.5 quintillion bytes? I don’t. I give up. I’d rather count the number stars in the universe. And I have been in the database business for more than 25 years.

But I don’t feel bad about that. If a pile of data requires a computer to process it, then it is already too “big” for our brains. In the age of “Big Data,” size matters, but emphasizing the size element is missing the point. People want to understand the data in their own terms and want to use them in decision-making processes. Throwing the raw data around to people without math or computing skills is like galleries handing out paint and brushes to people who want paintings on the wall. Worse yet, continuing to point out how “big” the Big Data world is to them is like quoting the number of rice grains on this planet in front of a hungry man, when he doesn’t even care how many grains are in one bowl. He just wants to eat a bowl of “cooked” rice, and right this moment.

To be a successful data player, one must be the master of the following three steps:

  • Collection;
  • Refinement; and
  • Delivery.

Collection and storage are obviously important in the age of Big Data. However, that in itself shouldn’t be the goal. I hear lots of bragging about how much data can be collected and stored, and how fast the data can be retrieved.

Great, you can retrieve any transaction detail going back 20 years in less than 0.5 seconds. Congratulations. But can you now tell me whom are more likely to be loyal customers for the next five years, with annual spending potential of more than $250? Or who is more likely to quit using the service in next 60 days? Who is more likely to be on a cruise ship leaving the dock on the East Coast heading for Europe between Thanksgiving and Christmas, with onboard spending potential greater than $300? Who is more likely to respond to emails with free shipping offers? Where should I open my next store selling fancy children’s products? What do my customers look like, and where do they go between 6 and 9 p.m.?

Answers to these types of questions do not come from the raw data, but they should be derived from the data through the data refinement process. And that is the hard part. Asking the right questions, expressing the goals in a mathematical format, throwing out data that don’t fit the question, merging data from a diverse array of sources, summarizing the data into meaningful levels, filling in the blanks (there will be plenty—even these days), and running statistical models to come up with scores that look like an answer to the question are all parts of the data refinement process. It is a lot like manufacturing gold watches, where mining gold is just an important first step. But a piece of gold won’t tell you what time it is.

The final step is to deliver that answer—which, by now, should be in a user-friendly format—to the user at the right time in the right format. Often, lots of data-related products only emphasize this part, as it is the most intimate one to the users. After all, it provides an illusion that the user is in total control, being able to touch the data so nicely displayed on the screen. Such tool sets may produce impressive-looking reports and dazzling graphics. But, lest we forget, they are only representations of the data refinement processes. In addition, no tool set will ever do the thinking part for anyone. I’ve seen so many missed opportunities where decision-makers invested obscene amounts of money in fancy tool sets, believing they will conduct all the logical and data refinement work for them, automatically. That is like believing that purchasing the top of the line Fender Stratocaster will guarantee that you will play like Eric Clapton in the near future. Yes, the tool sets are important as delivery mechanisms of refined data, but none of them replace the refinement part. Doing so would be like skipping guitar practice after spending $3,000 on a guitar.

Big Data business should be about providing answers to questions. It should be about humans who are the subjects of data collection and, in turn, the ultimate beneficiaries of information. It’s not about IT or tool sets that come and go like hit songs. But it should be about inserting advanced use of data into everyday decision-making processes by all kinds of people, not just the ones with statistics degrees. The goal of data players must be to make it simple—not bigger and more complex.

I boldly predict that missing these points will make “Big Data” a dirty word in the next three years. Emphasizing the size element alone will lead to unbalanced investments, which will then lead to disappointing results with not much to show for them in this cruel age of ROI. That is a sure way to kill the buzz. Not that I am that fond of the expression “Big Data”; though, I admit, one benefit has been that I don’t have to explain what I do for living for 10 minutes any more. Nonetheless, all the Big Data folks may need an exit plan if we are indeed heading for the days when it will be yet another disappointing buzzword. So let’s do this one right, and start thinking about refining the data first and foremost.

Collection and storage are just so last year.

Creating an Integrated Email Marketing Strategy

Keeping email in the sales tool box limits the benefits and keeps it from helping your company grow. Electronic mail is well known as a marketing tool that generates immediate cash flow. It works so well that many companies send daily updates that contribute a significant amount to their annual revenue. Some might say that this is the primary purpose for email marketing. Maybe they’re right but I think it is a shame to waste opportunities

Keeping email in the sales tool box limits the benefits and keeps it from helping your company grow. Electronic mail is well known as a marketing tool that generates immediate cash flow. It works so well that many companies send daily updates that contribute a significant amount to their annual revenue. Some might say that this is the primary purpose for email marketing. Maybe they’re right but I think it is a shame to waste opportunities.

Email is the only tool available today that can economically provide a one-to-one communication between company and customer or prospect. Perhaps it’s the fear that people will overwhelm already stretched customer service departments that keeps companies from capitalizing on the opportunities available. Maybe they’re spending too much time working on creating content in the hopes that it will go viral. Or it could be that email works so well as a sales tool little thought has been put into other uses. After all, when resources are limited, management tends to take an “if it’s not broke, don’t fix it” approach to projects.

This is a dangerous position because email as a sales tool is breaking. The days where emails sent to unengaged subscribers generated significant revenue with little effort are disappearing. The changes in Gmail’s interface are the beginning of a new email marketing reality. Begging people to move messages to the primary inbox is not a sustainable solution. Building relationships that makes them want to find your emails is the only way to continued sales success. Fortunately, email is a multifaceted tool that works well in relationship building.

The companies that change their strategy to include retention and education will gain market share, improve customer loyalty and make sales messages more profitable. There isn’t a downside to doing this because it delivers results at minimal cost. This strategy is part of an integrated marketing and service initiative that has far reaching effects.

The content created for educational messages establishes expertise, builds trust and can be repurposed on other channels. Google’s shift to conversational search requires marketers seeking better ranks to provide quality content. The best information speaks directly to the people who buy your products or services. Incorporating educational messages in your email strategy allows you to discover what drives sales and keeps customers coming back. The same messages will attract prospects.

Much of the information about relationship marketing implies that people want personal relationships with companies. They don’t. People want personal relationships with friends and family. They want companies to make it easy for them to solve problems. It’s a bonus if the company solves the problem without participation from the individual. Trust is established when company’s consistently deliver on their promises. Trying to create personal relationships with people who don’t want them is foolish and a waste of resources.

A better strategy is to find people’s pain points and make them disappear. This creates a trust relationship. Email is an excellent tool for sharing information and learning about your customers’ needs. An optimized email marketing strategy includes promotional, educational, and informational messages. Personalization is a key component that can be added by connecting historical data with targeted content.

We are entering a new era for email marketing. The timing is perfect for retailers and any business that peaks in first and fourth quarters. Optimizing your email strategy when the volume is at its peak allows you to learn quickly what works best. You can do this while still sending the promotional messages known to generate cash flow. Waiting to see if the changes to email delivery have an effect will put you behind the competition. Start immediately, plan well, test everything and use the actionable information to improve the customer experience and your company’s success.

A Goodbye
This is my last column for “The Integrated Email.” It is been my honor and privilege to share my knowledge with you. Thank you for the opportunity. Godspeed.

Editor’s Note: It has been a pleasure working with Debra. We are sorry to see her go, and hope she will be able to contribute in other ways in the future when her time permits. The Integrated Email will return in November with a new blogger.

Facebook Embraces Direct Response

Facebook dominates the Web, but it’s never really cracked the direct response puzzle. That looks like it will change in 2013 with an avalanche of new measurement and targeting tools. As a marketing platform, Facebook has traditionally thrived at top-of-the-funnel advertising. Unlike search, which hits people just as they express an interest in buying a certain product or service, social media marketing at its best builds relationships, and there’s compelling evidence for its value.

Facebook dominates the Web, but it’s never really cracked the direct response puzzle. That looks like it will change in 2013 with an avalanche of new measurement and targeting tools.

As a marketing platform, Facebook has traditionally thrived at top-of-the-funnel advertising. Unlike search, which hits people just as they express an interest in buying a certain product or service, social media marketing at its best builds relationships, and there’s compelling evidence for its value.

The heavy lifting for this type of advertising, however, happens on the advertisers’ own media—their brand pages. Although Facebook doesn’t charge for brand pages, it can still make money from them by selling ad units that encourage users to become fans, or that amplify the reach of content shared on the page. In a lot of ways, these are straight direct response ads, but with a call-to-action for a “like” or “share” and not a sale.

Showing marketers how many likes or conversations an ad produces is one thing, but proving ultimate sales is another, much more difficult job. Because Facebook advertising traditionally operated high in the funnel, the platform has long suffered from a “last-touch” bias. Click rates and conversions probably underestimate the actual impact of advertising on the Facebook platform, especially for the small display ads that appear to the right of the newsfeed. If people see an ad while they’re checking in on their friends, they may not click. Or they may click on it and do nothing. Later, however, they may decide to go to the website or a store and make a purchase. It’s often this last channel that gets outsized credit for this sale.

Overcoming this last-touch bias has become an imperative for Facebook. First of all, Facebook has developed “sponsored stories,” a native ad format that appears in the newsfeed and refers to how a friend interacted with a brand—becoming a friend, commenting on an article, redeeming an offer, etc. They still pivot off the relationships within Facebook’s social graph but have much higher CTRs and engagement. With these ads, Facebook has a more powerful format, where CTR becomes their ally as opposed to an obstacle.

Facebook is also trying to move down the purchase funnel by giving advertisers the ability to reach people who have already shown interest in a brand. Last year, Facebook introduced two new advertising products that do this. Custom Audience targeting lets advertisers upload their proprietary lists and match them with Facebook users to deliver sponsored stories or standard display ads to their existing customers. Early results show that these custom lists produce higher CTR and lower cost-per-lead. In February, Facebook reached an agreement with big data aggregators Epsilon, Axciom, BlueKai and Datalogix to import even richer audience segments.

Ulitmately, an even more important innovation might be Facebook Exchange, which allows marketers to retarget ads on Facebook. Through cookies and other tracking tools, Facebook can identify which websites users have visited—and even specific products they’ve browsed—and then deliver ads based on this information. Although the exchange is still in its early stages, it too has shown promising results.

Through Custom Audiences and its Exchange, Facebook is digging deeper into the buying process, but its big challenge remains attribution. It needs ways to span the gulf between advertising on the Facebook platform and the ultimate actions it produces. Custom Audiences and the Exchange have shrunk the width of this gulf but haven’t eliminated it—and its advertising team knows it.

That explains why Facebook bought Atlas Solutions from Microsoft right at the end of February. The ad server enhances Facebook’s ability to track online purchases. In announcing the service, Facebook’s Head of Monetization Product Marketing Brian Boland said, “Why we’re doing this is not to launch an ad network, and why we did do this is to improve measurement. We heard loud and clear from advertisers that they want to understand multi-touch attribution instead of just looking at the last click.” With the ad server, Facebook can deliver more types of ads to more publishers and, most importantly, it can effectively follow what users do online. It’s an incredibly powerful tool for online attribution.

It is made even more powerful when paired with Facebook Connect, a plug-in for online publishers that lets visitors log in to a website with their Facebook email and password. The service gives websites a simpler login process and gives them access to a rich layer of biographical information and connections that Facebook has amassed. Facebook, in turn, can see what people are doing all across the Web, not just in their walled community and, importantly, it can track activity across multiple devices, as long as a user has logged into Facebook from that device. If you see an ad on your desktop but convert via your phone or tablet, Facebook can track the activity.

Combining Atlas and Facebook Connect produces a powerful suite of online measurement tools. With a partnership with Datalogix, it can even track activity offline via loyalty cards and email addresses collected at checkout. With these tools, Facebook seems positioned to fully “close the loop” and overcome the last-touch bias. In classic direct marketing fashion, they also let Facebook better optimize who receives advertising. If you know who’s bought your products, you’ve found a great audience for future purchases.

Better measurement tools and advertising formats with higher click-rates transform Facebook into a legitimate direct marketing player. With Facebook experimenting with a slew of new DR formats and tools, including trigger-based Gifts, the social search tool Graph Search, redeemable Offers, and its gift card called—what else—Facebook Card, Facebook seems finally to have embraced it inner direct marketer.

7 Email Marketing Mistakes Even Seasoned Marketers Make

Email marketing is so easy that it is tempting to use it as a set-and-forget marketing tool. Failure to optimize email marketing strategy and execution affects customer loyalty, sales and costs. Email provides a personal, one-to-one connection between customer and company. It’s a shame to lose opportunities to build relationships, increase revenue and reduce expenses by not committing the time and effort required to maximize email effectiveness.

Email marketing is so easy that it is tempting to use it as a set-and-forget marketing tool. After all, if the subscriber list is large enough, almost every send will generate revenue. Marketers dealing with constantly changing technology, platforms and channels have little time to commit to a channel that works with minimal effort.

Failure to optimize email marketing strategy and execution affects customer loyalty, sales and costs. Email provides a personal, one-to-one connection between customer and company. It’s a shame to lose opportunities to build relationships, increase revenue and reduce expenses by not committing the time and effort required to maximize email effectiveness.

Most of the mistakes made in email marketing have simple fixes with minimal costs. Here are seven common mistakes made by even the most experienced marketers:

1. Treating All Subscribers Alike
People choose to receive your emails for personal reasons. Some are trendsetters who want to see the latest and greatest items. Others are discount shoppers seeking the best deal. Nestled between the two are a variety of personalities looking for specific solutions to their problems. Failing to recognize the different types and create customized marketing messages for them speeds the email fatigue process and reduces sales opportunities.

2. Failing to Capitalize on Contact Opportunities
The email subscription process provides several opportunities to connect with people interested in knowing more about your business and products. Each step should be used to educate, entertain, and enlighten new subscribers. Poorly designed confirmation pages and welcome emails are lost opportunities.

3. Ignoring Deliverability Rules
The problem with this mistake is simple and obvious: Emails that don’t reach recipients won’t generate responses. Spam is a huge problem. According to a report by Symantec, 75 percent of global emails are spam (pdf). The tools designed to eliminate spam aren’t perfect. Encouraging subscribers to whitelist your emails increases deliverability but it doesn’t guarantee it. Ensuring that all emails follow deliverability rules improves chances that people will actually receive them.

4. Repeatedly Sending the Same Visual Email
Creating branded templates so that your emails are easily recognized is a good practice. Using the same one repeatedly isn’t. You have less than three seconds to capture the recipient’s attention before the delete button is pushed. People respond to visual information first. If all of your emails look alike, they trigger an “I’ve seen that already” response.

5. Presuming Recipients Recognize Icons and Know What You Want Them to Do
Icons are great visual add-ons, but they need a text call to action to encourage people to take the next step. People are trained from an early age to follow instructions. If you want them to connect with you on social platforms, visit your website, call your business, or get directions to your store, tell them. Icons without a call to action are tools for people who already know what they want. Icons with a call to action encourage people to do what you want.

6. Neglecting to Make Emails Mobile Friendly
According to a study by YesMail, over 41 percent of mobile device owners said that they have made either an online or in-store purchase as a direct result of an email promotion they viewed on their device. Are your emails easy to read on the small screen? Do all sections render properly for mobile devices? Some emails show a blank body when viewed on cell phones. Be sure to test your emails on Apple, Android and Blackberry devices to ensure recipients can read them.

7. Expecting HTML Emails to Automatically Convert to Readable Plain Text
The automated conversion tool provided by most email marketing services simply converts HTML to text. It does not make it readable. If your email is filled with links, the text version will look like a page of computer code instead of a message from a company that cares about customers and prospects. Always create HTML and text versions of every email to insure the message is appealing and readable for all recipients.

5 Surprising Email Metrics That Transform Businesses

Email is the most effective under-utilized marketing tool available. The instant revenue generated with each send lures marketers into the trap of sending one sale email after another. Measuring these metrics will begin the process that moves email programs from one-off promotions to campaigns designed to acquire prospects and convert them into loyal customers.

Email is the most effective under-utilized marketing tool available. The instant revenue generated with each send lures marketers into the trap of sending one sale email after another. Investing the time to create a program that builds long term relationships seems almost wasteful. After all, the low hanging fruit is easy to get and there are so many other things that need doing.

Measuring the following metrics begins the process that moves email programs from one-off promotions to campaigns designed to acquire prospects and convert them into loyal customers. The people who subscribe to emails are highly qualified candidates for long-term relationships. They are interested in your company’s offerings and have given you permission to share information with them. Providing more than the latest sale prices opens the door to unlimited potential.

  1. Acquisition—How many prospects did your email program acquire last year? What percentage was converted to customers? Email is an exceptional prospecting tool. It is low cost with potentially high return. Create a specific process designed to acquire prospects and convert them into customers. Measure it carefully so you have benchmarks for improvement. Set specific goals to insure that the marketing team’s focus extends beyond the daily revenue stream.
  2. Retention—How well are you keeping customers coming back? Who is participating in your email program? Are they platinum customers with consistent purchase patterns of regular priced and discounted items? Are they discount customers who only buy sale items? (This type may be mislabeled if you only send discount emails.) Or, are they hit-&-run shoppers who subscribed with their first purchase but have never ordered again? Knowing the retention rates and customer types helps create a program that keeps customers coming back.
  3. Engagement—Direct marketers know that motivating people to do something increases the likelihood that they will make a purchase. This is why direct mail pieces have scratch-offs, peel and stick labels, and other devices designed to motivate people to act. Email is a tool that makes it easy for people to do much more than that. It has the option for the two way communication that builds relationships. Personal messages encourage people to respond emotionally and create connections between customer and company. Strong connections keep competitors from stealing customers.
  4. Lifespan—Email customers have a different lifespan from customers acquired or active via other channels. Knowing how people behave from first purchase to last provides information that can be used to fine-tune the email program. Monitoring this data helps identify trends. Watch for course changing events that shorten or lengthen individual lifespans so you can adjust marketing and service as needed.
  5. Comparable Values—Customers acquired via the same channel who have similar activity typically have comparable value in annual sales and profitability. A wide variance in comparable value provides an early warning system before the bottom line starts dropping. If you see value inconsistencies, look for causes that include marketing fatigue, service issues, increased competition, and niche saturation.

The people who subscribe to your email program are like the ones who receive direct mail pieces or catalogs. They respond to the same triggers, so the tactics that work for direct mail work for electronic media too. Design a strategy that moves beyond sale flyers to build a loyal following. Creating an email marketing strategy designed to acquire prospects, convert them to customers, and keeps them coming back for more is simply good business guaranteed to generate a great return.