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    Realities of successful_direct_marketing__final Realities of successful_direct_marketing__final Presentation Transcript

    • The New Realities of Successful Direct Marketing August 22, 2013 A special thank you to: Thank you for joining us – we will be starting at 2:00 PM ET/11:00 AM PT If you are unable to hear music at this time, please make sure that your computer speakers are turned on and that your system has not been muted. #TMGWebinar
    • Today‟s Speaker Heather Fletcher Senior Editor Target Marketing Michael Lowenstein, PhD, CMC Chief Research Officer, The Relational Capital Group Thought Leadership Principal, Beyond Philosophy Moderator #TMGWebinar
    • Tips for Webinar Attendees • Technical difficulties? Let us know by using the “Q and A” box, or trouble-shoot by clicking the “Help” widget below → Quick tip: Common problems (like loss of sound and/or stall in the slides) can often be fixed by a quick refresh of your browser. • Have a question for today‟s speaker? Submit via the “Q and A” box • Please disable pop-up blockers • See what this console can do! Click on the “Tips for Attendees” widget for the complete rundown. Don‟t forget to “share” this webinar! #TMGWebinar
    • About the Presenter • Over 35 years of B2B and B2C management , research, and consulting experience; passionate about brand- building, offline and online communication approaches, and customer behavior • Focus on major and evolving new marketing and customer behavior influence trends • Author of 150+ articles and white papers, and several customer-centric marketing and customer experience books, including – – Customer Retention (1995); The Customer Loyalty Pyramid (1997); Customer WinBack (2001), One Customer, Divisible (2005), and… – The Customer Advocate and the Customer Saboteur (2011): Linking Social Word-of-Mouth, Brand Impression, and Stakeholder Behavior – New ebook, A Customer-Centric Year, now in development
    • 1. The rise of mobile and impact on direct response design and execution 1a. Consumer requirement for omnichannel information and purchase 2. Effect of perceived brand trust, and emotional and relationship behavioral drivers 3. Satisfaction measurement is so „80‟s, and the need and availability of accurate, actionable, and real world performance metrics 4. The name of the game is customer dialogue, inclusion and collaboration/involvement 5. The reconsidered importance of, and new techniques for, direct marketing analysis, modeling, and testing 6. Addressing the downstream behavioral power of customer experience Today‟s Webinar: Examining Six (Maybe Seven) Critical New Direct Marketing Realities
    • New Direct Marketing Reality #1 and #1a: #1 - The Rise of Mobile and Impact on Direct Response Design and Execution and #1a - Consumer Requirement for Omnichannel Information and Purchase
    • Web and Content Personalization • Site personalization algorithms/application tools much more prevalent – for both B2B and B2C visitors • The names of the game are leads and conversion, keeping visitors on the site, driving multiple page usage and visits, and monetizing visit results • Functionality can‟t be sacrificed for design/graphics (which actually drive down page visit time), nor can emotional engagement • Must also drive offsite, offline and digital behavior • Increasing emphasis on in-the-moment and real-time content/messaging • Test, test, and retest using A/B and multivariate tools: Most designers apply usability approaches such as ethnography, think-aloud tests, sorting techniques, observation, and live site methods - - NOT NEARLY ENOUGH! • Modification of classic customer behavior research approaches needed
    • Evolving Active Inclusion Of Mobile Device Requirements and Channels • In mid-2013, 56% of Americans own a Smart Phone • 15% of global Internet users now on mobile; increasing at 50% per year, and not expected to slow over the next few years • Priority need: Site design modification or transformation • This includes menu simplification, easily identifiable branding, text size reduction, links to full web site • More focus on display responsiveness, sized for fingertips • Content, especially (based on study results), must be optimized for mobile viewing; example of high email deletion on mobile if not done • Focus on in-the-moment and real-time marketing content, for online and offline/digital social sharing
    • “Engagement” and “Social” TV • Customizing content experiences via photos, bonus clips, games, etc. • Principally aimed at reality TV shows, but also applied to build viral interest in mainstream programming (The Wire, Sopranos, Homeland, Breaking Bad, True Blood, Dexter, Doctor Who, Jersey Shore, etc.) • Digital content offered as video-on-demand, through online and mobile formats (to provide immediacy), proven to deepen relationship for program and sponsor; can also boost viewership of main program • Notable failure, Fringe: Fox created the Observer, a mysterious character with a unique, bald-headed look. To raise interest in "Fringe," Fox had the Observer show up on other shows, including 2009 All-Star game and a 2009 episode of “American Idol” However, little crossover between sports fans, reality TV fans, and sci-fi fans, making a promotion an odd fit. • Example: Last Chance Kitchen, 11 minute episodes of eliminated candidates from Top Chef. Created 24% online reach lift for Toyota
    • Building in „New‟ Email Campaigning • Email is a preferred communication method: Trustworthy, relevant, conversational, and can be omnichannel • Trend to hypertargeting and simplicity: short messages, custom designs and/or microsegmentation, emotional focus on engagement • Trend toward more real-time marketing support • Significantly more mobile emailing • Digital mailbox modification will create more personalization • „Share-worthy‟ email content to create more social value, downstream neural communication • „Transactional „ proactive emailing on rise: account alerts, password resets, order updates, receipts, shared content, etc.
    • Is Email Generating Leads/Return Visits? • Does it have a „hook‟ (i.e. USP), subject line, and a call to action? • Is it micro-targeted according to individual customer interests and needs? • Does it reflect buyer/user/influencer personas? • Is it tailored to buying/customer life cycle stages? • Is it using social media tools – shares on LinkedIn, Twitter, Facebook, Pinterest, etc. – to extend value of campaigns? • Is it „hygienic‟, i.e list accuracy, opt-in/opt-out strategy, message consistency by medium?
    • Don‟t Undervalue or Underuse Offline Communication • Ed Keller (Keller Fay): 15% of population are creating 1.5 billion brand impressions every day • Though digital media and viral campaigns get a lot of attention, and may increasingly start conversation, much of the actual dialogue still takes place offline (B2B and all demographic and lifestyle groups of B2C consumers, per The Face-to-Face Book) • Despite media focus on neural communication negativity, much of WOM is positive • Should be blended with online, digital, traditional electronic and print communication media • „Stars‟ of peer-driven WOM: Apple/iPod, Toyota, WalMart, Hewlett- Packard, Budweiser, Zappos, Amazon, Google
    • New Direct Marketing Reality #2: Effect of Perceived Brand Trust, and Emotional and Relationship Behavioral Drivers
    • In Praise of Content Marketing • Puts a „personality‟ on both the organization and its value proposition • Helps to develop new business and identify market position • Multiple communication and expertise showcasing opportunities: ebooks, blogs, articles, podcasts, videos, • Ability to create and sustain thought leadership • Enables employees, as authors and contributors, to be ambassadors for the enterprise, increasing the emotional/relationship connection with customers and prospects • Ideal balance may be 80% thought leadership and 20% marketing • WARNING: Avoid temptation for content to be too closely tied to sales and customer life cycle
    • Leveraging Rich Video • Attractive, differentiating, and engaging alternative to text: Proven higher conversion and customer retention rates (compared to text) • Anticipated (by Cisco) to be 70% of consumer Internet traffic by 2017, up from 57% now • Formats such as video web meetings, screen shots, interactive web events, available in multiple formats: Mobile, Internet (Instagram, Vine, You Tube, etc.), TV • On-demand ability for marketers to reinforce brand position, image and relevance through consumer engagement • Can connect/integrate with personalization CEM and CRM tools • Examples: Home Depot demo podcasts; Luna Ukulele and Guitar demo podcasts
    • Impact of Trust and Reputation Bank A: Proaction Provides Positive Behavior-Driving Value/ Service Consistency and Reliability Seen As Key Negative
    • Bank B: Sense of Belonging and Proactive Service Positive Drivers/ Significant Erosion and Behavioral Impact of Trust and Confidence
    • 11% 24% 2% 1% 23% 2% 10% 4% 6% 3% 11% 2% 2% 1% 3% 26% 2% 3% 3% 9% 3% 2% 2% 35% 3% 4% 3% 2% Q8A. Is a stable company Q8B. Has a positive reputation Q8C. Is a vendor that positively stands out from its competitors Q8D. Is a reliable company Q8E. Is a company I trust Q8F. Is easy to do business with Q8G. Understands my overall business objectives Q8H. Is a preferred vendor for organizations like mine Q8I. Exhibits market leadership Q8J. Reduces commercial risk Q8K. Manages our relationship at a strategic level Q8L. Has vertical industry expertise Q8M. Invests in the future to be a leader Q8N. Is a company that ensures my personal success Alienated/Amb Advocate B2B Company: Reducing Commercial Risk Is Key Positive, As Is Trust (Also Negative)
    • New Direct Marketing Reality #3: Satisfaction Measurement is So „80‟s, and the Need/Availability of Accurate, Actionable, and Real World Performance Metrics
    • Source: CompuStat and ACSI -100 0 100 200 300 400% -30 -20 -10 -0 10 20 30% Sales annual growth ACSI annual growth R² = 0.00 Reality: CSI Scores Do Not Predict Revenue Growth
    • • Grow Revenue • Position Brand • Increase Share • Decrease Risk The Impact of New Communication and Real-Time Influence has Pushed the Strategic Relevance of Advocacy and Brand-Bonding Behavior Assessing customer relationship has its genesis in quality assessment. Realization that quality alone does not generate a satisfied customer. Satisfaction gets to some of the intangible dimensions of the relationship, but is a passive measure and does not explain nor predict retention. Embrace customer retention to the framework, but it does not capture the influence customers have on “other” customers and partners. Advocacy captures the influence the customer and partner base have, in addition to measures below. 80s: Quality 90s: Satisfaction Late 90s: Loyalty Current: Advocacy
    • The Role of Customer Advocacy and Brand Bonding In marketing and services decision-making guidance and ‘how-to’ action, including…  Marketing and Communications Planning and Engagement Media Effectiveness  Customer Service/Touchpoint/Process Experience Effect  Company Image and Reputation Impact  Product and Service Development  Customer Relationship Building  Brand Messaging and Positioning Assessment  Loyalty Program Development/Refinement  Customer Life Cycle Optimization
    • 10% 14% 17% 15% 22% 5% 1% 6% 12% Staff always takes the time to talk with me I have an open and honest relationship with the people at my bank Staff proactively suggests products and strategies that will help me Staff suggests only those products that are best for me Staff follows up with information as needed Staff delivers service in a timely manner Staff are trained to offer reliable services Staff appears competent and knowledgeable Staff makes me feel like a valued customer 24% 21% 14% 1% Alienated Advocate Critical to Reducing Alienated Critical to Building Advocates 13% 13% 9% 6% 1% Advocacy Driver Analysis Swing up and swing down (‘swing voter’) analysis identifies the performance attributes that will drive customers from Alienated to Ambivalent, Ambivalent to Allegiant, Allegiant to Advocate. Analysis repeated for brand, product and key touch point attributes for input into an overall improvement action plan. Quality of Staff Services
    • Relationship Attributes for B2B Services Company Swing Up (to Advocate)/ Swing Down (to Alienated)
    • Advocacy Segmentation: Profile of Attitudes (Top Two Box Ratings) Critical Attribute (Scale: 1 – 10; 9 and 10 Are Top Boxes) Advocate Allegiant Ambivalent Alienated Brand Has earned my trust and confidence 81 28 6 2 It is a pleasure to do business with them 78 22 5 1 The bank is definitely for people like me 79 26 7 2 Staff Staff makes me feel like a valued customer 75 22 8 2 Staff are trained to offer reliable services 71 20 7 3 Staff follows up with information as needed 71 18 5 2 Value Proposition Breadth of checking and savings accounts offered 62 13 4 1 Variety of cards with different features suitable to you 53 11 4 1 Communication of different products and their features 60 13 3 1
    • Advocacy Applied to Customer Life Cycle Evaluation: Defected B2B Customer Advocacy-Based Research Example
    • Price is the most frequently stated reason for defection.  Changes in business focus also fuel discontinuation.  Though content is also mentioned, a closer look at the verbatim comments indicate that most often a business focus change rendered the content less meaningful, rather than a dissatisfaction with the content itself. Reasons for Defection
    • 3% 10% 5% 6% 3% 36% 2% 1% 4% 6% 2% 1% 6% 15% 3% 1% 18% 2% 2% 2% 19% 2% 1% 4% 23% 2% 18% 2% Customer service Timeliness of information Usefulness of product delivery method Product quality Information content‟s relevance to your needs Competitiveness of pricing Billing accuracy Timeliness of problem resolution Licensing requirements Ease of doing business Reputation Market Leadership Understanding of your data/information needs Customer focus Building Customer Advocacy and Reducing Alienation
    • Reality: Key Advocacy and Brand-Bonding Business Value Message “The benefits of building advocacy can’t be ignored. Satisfaction and loyalty are important, but they’re old news. It’s a new dawn in customer experience strategy, where the customer controls over 50 percent of the brand message. Forward thinking companies will be the ones that identify and work with their customer advocates to genuinely build trust in the brand, the customer base, and the bottom line.” Cultivating Customer Advocates: More Than Satisfaction and Loyalty 2011 Peppers & Rogers Group White Paper
    • New Direct Marketing Reality #4: The Name of the Game is Customer Dialogue, Inclusion and Collaboration/Involvement What happens when Advocacy and Brand Passion (Excitement) can be brought together in the same person?
    • Actively Encourage and Facilitate Two-Way and Multi-Party Dialogue • Push and mass messaging has given way to partnership and inclusion • „Conversation Catalysts‟ (Keller Fay): Create more opportunities for customers to talk to each other, learn from marketers, and share positive and negative experiences • Content should be timely and engaging to stimulate involvement; brands should actively encourage response (text analytics/learning applications) • Leverage consumers to help with positioning, cross/omni channel messaging, product and service development • Example: Harley Owners Group (H.O.G.) clubs, especially in Europe • Example: Denny‟s Canada mobile loyalty program, providing points for friends and social invitations for them to meet members at Denny‟s restaurants • Example: Umpqua Bank and Zane‟s Cycles in-store cafes in U.S.; Metro Bank in U.K. (employee dialogue, involvement of kids and pets) • Example : Rackspace interactive podcasts between employees and users
    • 33 Brand Experience Segments Customer Experience Segments 79% 31% 5% 86% 68% 34% 59% 24% 7% 45% 12% 3% 77% 24% 5% Financial Services 2012 Monitor – Retention Likelihood By Customer Advocacy and Brand Passion
    • Market Probe 2012 Bank Monitor Financial Services 2012 Monitor Stock Investment
    • New Direct Marketing Reality #5: The Reconsidered Importance of, and New Techniques for, Direct Marketing Analysis, Modeling, and Testing
    • Review: What are we testing? • Graphics, including embedded streaming video, photos, and illustrations • Headlines and key lead-in statements • Messaging/copy and theme concept alternatives • Alternative and multi-channel media and formats – electronic/email, print, online/web sites, mobile, social, promo devices/advertising • Color or black & white • Invitation/order/reply forms • Pricing variations • Incentives/premiums/special promotions • Availability dates/timing • Personalization/digital printing • Drop/campaign flighting dates • In-house engagement, such as website support and customer service
    • Much to Consider
    • The Value(s) of Multivariate Testing • Traditional A/B split-run testing too slow and expensive • Because only one factor can be tested at a time with A/B, it is often difficult to identify what optimum performance could be in different marketing situations • Control, or original, version may perform better than test version in A/B – taking design back to square #1 • Through multivariate testing, many elements can be evaluated at the same time: salutations, typefaces, copy lengths, illustrations/graphics, offers, bonuses, media alternatives, response devices, etc. • Simultaneously testing conversion/success rate of each factor or element; significantly less expensive, with smaller sample sizes, and greater accuracy • Plentiful availability of „bookshelf‟ testing software for extrapolation and estimation of results
    • New Direct Marketing Reality #6: Addressing Downstream Behavioral Power of Customer Experience
    • How does your company create, and benefit from, involved customers? They are, or can become, your best customers They are loyal, buy more products from you or exclusively use your brand (narrowed consideration set) They are your unpaid, voluntary (even enthusiastic) outside sales force They contribute to new product and message development They are the strongest promoters and endorsers of your brand, online and offline They respond to your array of marketing efforts, and are responsive to both multiple channel communication and real-time engagement
    • Brands Which Actively Involve Customers
    • Bringing It Together: How Do These Companies Drive Optimum Loyalty Behavior? • Zappos – corporate service/values orientation; customer service • Wegmans – distinctive store design and upscale customer experience • Southwest Airlines – employee ambassadorship; customer-focused processes; passenger experience • Umpqua/Metro Bank – café-like bank design; ultra-proactive service • Tesco – „Price Promise‟ comparison on all programs (retail, banking, insurance, etc.); Downton Abbey sponsorship • Lego – innovative brand-building and product development, microsites, product mini-series, social networks, clubs and club magazines • Amazon – micro-targeted and personalized online communications and site landing pages • Baptist Health Care – employee teams, extraordinary service and community outreach, legendary word-of-mouth • Ritz Carlton – unparalleled service, personalized guest experience • IKEA – low prices, unique in-store experience, proactive service • Rackspace – online dialogue/podcasts between employees and users • The Container Store – mobile digital catalogs; in-store experience • IBM – consultative content–rich strategy for each business segment
    • Video Links 1. Lowenstein on 10 Years of Direct Marketing Change http://bit.ly/13iiEmj 2. Getting the Message Out Now vs. 10 Years Ago http://bit.ly/172N9yK 3. Doing It Right - Which Marketers Understand the New Ecosystem vs. 10 Years Ago http://bit.ly/1cyLXKD 4. Content Marketing and Trusting Customers – Loyalty Now vs. 10 Years Ago http://bit.ly/1662vjq
    • Thank You! Link to my CustomerThink customer experience portal blogs: http://www.customerthink.com/user/michael_lowenstein Link to “Back to the Future” blog in CustomerThink: http://www.customerthink.com/blog/the_new_realities_of_succ essful_direct_marketing For further information, or if there are post-session questions, please contact me at: mwlowenstein@gmail.com or 856-283-1182
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    • Thank You Thank you for taking the time to attend our webinar today. For additional information about our webinar series, check out the following Web site: www.targetmarketingmag.com/webinar Please take a moment to fill out our feedback survey. (It will open in a new browser window/tab momentarily!) #TMGWebinar