Recalibrating The Meaning of “Relevant” March 11, 2008
Posted by Elana Anderson in Customer Experience, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Online Marketing.Tags: credit triggers, cross-channel integration, Integrated Marketing, interaction optimization, lifecycle marketing, Marketing ROI, multichannel marketing, relevant marketing
3 comments
Have you ever refinanced your mortgage only to be bombarded by offers to lower your mortgage rate for six weeks after you closed on your new loan? This happens because financial services companies are purchasing “triggers” from credit bureaus that indicate you have had a recent loan approval. The problem with these triggers is that they are not timely. By the time the marketing communication gets to the customer, it’s too late.
Relevance = right message + right time + right place
Perhaps it is a cliché, but it’s a good one. Too many marketers focus entirely on the message component of relevance. For these marketers, “place” is typically an outbound channel and “time” is based on the internal campaign calendar – not the customer’s needs. To be relevant, marketers must step outside the confines of the functional silo that they are responsible for and think outside in – from the perspective of the customer. In addition to targeting the message itself based upon a customer’s stated or implied needs, relevance requires:
- Timely reaction or response to customer actions. Although some marketers are experimenting with trigger-based communications and on-site customized messaging, the prominence of these tactics pales in comparison to the weekly or semi-weekly campaign pushes. The beauty of these tactics, however, is that they can be automated.
- Cross-channel integration. Your customers don’t care that you are only responsible for email and not the website or direct mail and not the call center. When a potential customer clicks on a search result or an online ad and lands on your generic home page or receives an offer in the mail and calls customer service to inquire further, he expects a seamless handoff. Yet, creative elements often dominate conversations about integrated marketing rather than a focus on what the customer is trying to achieve as he traverses the channels. The result of this oversight? For the customer, it often means dead ends and unnecessary frustration. For the company, it means lost opportunities and, possibly, damage to the brand.
- A programmatic approach. Did you know that maximizing individual campaign response might be to the detriment of overall program ROI? That’s right. Sending more messages may generate a higher response, but how many others are simply tuning out? The current industry standard in the retail sector is 1-2 email messages a week. Amazon differentiates itself in the inbox by not always being there. An email offer from Amazon might be, “A brand new Leonard Cohen CD is available. Since you have enjoyed Leonard Cohen in the past, we thought you might want to know…” This programmatic approach requires different metrics than the campaign-centric approach – for example, program engagement over time or revenue per customer (not campaign).
What To Expect From Your Web Analytics Tool (Web Analytics Series, Part 2) January 15, 2008
Posted by Elana Anderson in Customer Analytics, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Marketing Technology, Online Marketing, Web Analytics.Tags: Acxiom, Coremetrics, Interwoven, Kefta, Offermatica, Omniture, Optimost, TouchClarity, Unica, Visual Sciences
4 comments
In my post just before the holidays, I shared a framework to help marketers think about how web analytics contributes to data-driven marketing effectiveness over time. Marketers agree that they want to deliver more relevant and timely communications, establish a two-way dialog, and generally be more customer-focused and integrated, but many are struggling to make positive progress. Use the framework to understand understand the maturity of your data-driven marketing practices. Then define your objectives and timeframe for making incremental progress. In this post, I want to discuss how marketers can use their placement on the framework to define the key requirements for their web analytics tools. I work with an awful lot of firms out there that are not getting the benefits that they should be out of the technologies that they purchase. Why? Well, I think one key reason is that they are overly aggressive in their expectations of what they will achieve and over what time. The result is a lot of wasted technology — and wasted time.
If we were more realistic about what we are trying to achieve (i.e., the business outcome) with our web analytics tools then I believe our learning curve around how to effectively understand and leverage the data would actually accelerate. Why? Because we wouldn’t be constantly struggling with the technology. The free tools on the market are getting better and, while they are not sufficient for marketers that are beyond Stage 1 maturity, they will meet the needs of many. Here is a starting point to help you get beyond vendor eye candy and align functional requirements with business objectives:
Stage 1: Site analysis
Key questions you need to address:
- How many visitors are coming to my site?
- How are visitors using my site?
- How are visitors finding my site?
Core functional requirements:
- Visitor analysis
- Referrer analysis (pages and keywords)
- Strong library of parameterized “out of the box” reports
Comments on the market: These capabilities are table stakes to enter the web analytics market and most of the solutions out there do a reasonably good job here. Expect a more limited library of reports and more limited customization features from the free tools.
Stage 2: Site optimization
Key questions you need to address:
- How can I increase site visibility?
- How do content and taxonomy influence desired action?
- What would improve site navigation?
Core functional requirements:
- Path analysis
- Page and scenario drilldown analysis
- Drop-off analysis
- A/B and multivariate testing
Comments on the market: This is currently an area of focus for leading vendors in the market. The once-standalone optimization players – like Offermatica (acquired by Omniture), Kefta (acquired by Acxiom), and Optimost (acquired by Interwoven) – have been acquired and other vendors are looking to add these capabilities through acquisition or organic development. Given current client emphasis on customer experience management, expect this to continue to be an area of hot competition in the near future.
Stage 3: Segment targeting
Key questions you need to address:
- How can I logically group site visitors?
- How can I target visitor content by segment?
- How can I leverage site learning in other communication?
Core functional requirements:
- Segmentation model templates
- Ability to persist segments
- Ability to create dynamic segments and apply them historically
Comments on the market: Leading web analytics vendors like Coremetrics, Omniture, Unica, and Visual Sciences (acquired by Omniture) offer segmentation capabilities but this is an area where vendors differentiate.
Stage 4: Individual customization
Key questions you need to address:
- What is the best content for an individual based on prior site interaction?
- Should I reach out to an individual customer NOW?
Core functional requirements:
- Individual visitor profiles retained over time
- Ability to match profile to current visitor context – in real-time
- Ability to unify profiles when visitor identifies
Comments on the market: A few leading vendors are really just starting to focus here. Omniture’s recent acquisition of TouchClarity is a good example. Unica is also working on integrating it’s web analytics and campaign management modules in a meaningful way. But, overall, the vendors are just getting started at figuring this out.
Stage 4: Integrated marketing
Key questions you need to address:
- How are customers using online and offline channels in the buying process?
- How can I optimize online and offline interactions?
Core functional requirements:
- Calculate and retain key profile metrics
- Track metrics longitudinally
- Open data model and facilitation of extracts to other systems
Comments on the market: Today, you’re mostly at the mercy of your internal IT shop when it comes to the level of data integration sophistication required to help marketers in large companies integrate their activities across channels. Some firms call upon their interactive agency, systems integrator, or database marketing service provider to help. But, each approach has its challenges. It may make you feel better to know that no one has nailed this one and that gives us all something to aspire towards. At the end of the day, I believe that if the web analytics vendors want to be part of the solution then they need to hire (or partner) with database marketing gurus in order to make real progress.
What Does [Should] A CMO Do? December 18, 2007
Posted by Elana Anderson in Integrated Marketing, Marketing, Marketing Measurement, Marketing Strategy, Marketing Technology.Tags: CMO, Customer Centricity, Customer-Centric Marketing, Marketing Leadership, Role of CMO
1 comment so far
In its quarterly SEC filing, Orbitz announced that it has (also see related AdAge article):
…decided to eliminate the global Chief Marketing Officer position and continue managing the Company’s marketing efforts on a regional basis. In connection with that decision, Randy Wagner, Chief Marketing Officer of the Company, is expected to leave the Company in mid-February 2008.
That’s unfortunate. I’ve met Randy — she was a keynote speaker at the Forrester Marketing Forum last year which I hosted. She’s a bright, strong leader and I’m sorry to see her go. But, I’m more concerned about Orbitz and all of the other companies out there that are cutting CMO positions and/or clearly struggling to define the role.
I think Orbitz is missing the point. I don’t disagree at all with the idea that defining and managing campaigns on a regional level can be a more effective way to drive to growth goals. I just don’t think that the job of the CMO is to define and manage campaigns.
So, what SHOULD a CMO do?
Well, we’ve been talking for years about integrated marketing, customer centricity, customer relationship management, customer experience management, 1:1 marketing, etc… I’ve been intimately focused in this arena myself for a over a dozen years and I feel like we (the broad and royal “we”) have made little progress towards these goals. To be sure, a lot has also changed in the last 12 years but if we EVER want to get there (or even close) then we need a strong leader. And, from my perspective, that leader is the CMO. The role of the CMO should be to:
define and lead a customer-focused marketing strategy that crosses product, channel, geographic, and even functional boundaries.
I realize that this is much easier said than done. It starts with a CEO who believes in the business benefit of being customer-focused and a CMO with the vision, leadership capabilities, and charter to make it happen. It will also require:
- A complete overhaul of the marketing organization. I’m talking structure and reporting hierarchies, metrics, culture, and process — all of it. What’s the right answer here? Well, as all good consultants say, “it depends”;-) I haven’t found a perfect organization yet. The key is understanding where the organizational weaknesses are and then putting tools or processes in place to help bridge the gaps. First and foremost, however, I believe it starts with the metrics. The CEO, CMO, and CFO need to sit down and figure out how to measure marketing impact in ways that don’t result in marketing teams competing with one another for customer mindshare or quibbling over which team gets credit for customer conversion.
- Acquiring and nurturing new skills. What skills am I referring to? Left-brained skills: business acumen, process orientation, quantitative analysis, and technical knowhow. We’ve been talking about this one for a while and it is slowly happening. But, marketing leaders often complain that it’s hard to find these skills along with a love of the customer and a passion for marketing all in the same body. I suggest looking for consultants (Accenture, Bain, etc.) who want to get off the road, pillaging your internal IT organization for the systems analysts or project managers that always ask the business questions, or plucking young marketing analysts for whom there is no technical barrier and putting them all in an aggressive mentorship and cross-team training program.
- Significant investment in technology and infrastructure. How boring is this one? My POV on this is that rather than going goo-goo gaga over the next trend and treating it as a antidote to all of marketing’s woes, it’s high time for marketing organizations to recognize that technology — and integrated technology at that — is a crucial enabler. To achieve our goals of customer-centric and integrated marketing, we need to manage the marketing process on top of a framework that is, itself, integrated. Again, no easy answers here — there’s no vendor or application out there that will take care of this for you. And, I’m not saying that the CMO has to be a techie. But, a good leader recognizes his/her strengths and weaknesses and surrounds him/herself with a team that can fill the gaps. The bottom line here is that marketing organizations need to have a technology strategy. Those that don’t will NEVER achieve the customer-centric vision or be able to effectively integrate their activities.
Who is responsible for driving this agenda — on a global level? The CMO.
Now, I also want to be clear here that I was not implying above that the CMO doesn’t have responsibility for the global brand(s)… She does! Today’s consumers are really good at sniffing out and publicizing inconsistencies between what corporations and their brands say and how they act (think the recent Unilever Dove/Axe controversy). So, today’s CMOs must own aligning every brand under the corporate umbrella with the core values of the corporate entity and reconciling the brands with one another. Companies that fail to do this are at the mercy of the consumer.
Web Analytics Needs To Grow Up (Web analytics series, Part 1) December 11, 2007
Posted by Elana Anderson in Customer Analytics, Customer Experience, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Marketing Technology, Online Marketing, Web Analytics.Tags: Unica, Web Analytics, Web data analysis, Web maturity
3 comments
Last week I was privileged to spend the day in the company of several thought leaders in the field of Web Analytics. Dr. Alan Hall, Avinash Kaushik, Judah Phillips, and I participated in several taped panel sessions that focused on how to best leverage web data to improve marketing effectiveness and how to effectively leverage investments in web analytics technology. We were joined by, Steve O’Brien, Akin Arikan, and Karen Hudgins from Unica which sponsored the get together. What struck me most about our conversations (on camera and off) is how committed each of us is to moving Web analytics beyond what today is largely a passive, report-centric discipline towards one that:
- Improves the effectiveness of individual customer interactions
- Actively contributes to the understanding of the customer
- Is a key part of improving marketing’s ability to measure across channels
Five key stages of web analytics maturity
One of the bits of original thinking that I contributed to the discussion was a framework that breaks down five stages of Web Analytics maturity.
Don’t pay attention to the stages for the moment… This is not a new picture (I pulled the base graphic from a from a client deck I presented in 1998). And, few would disagree. If a marketer is not leveraging any data to drive marketing communications, just adding a little bit of filtering or segmentation will have a tremendous positive impact on results. But, at some point, our ability to continuously improve results through segmentation levels off. At that point, the way to get the next hockey stick impact on results is to use individual customer data. Definitely not new thinking, but I think it helps level set us that is what “1:1” or “customer-centric” (you pick the cliché) marketing is all about – using knowledge about the individual customer to drive interactions that, at the end of the day, benefit both parties.
This framework can also help us think about how we are using the mountains of web data that we’re collecting to help us move up and right on the chart. I break the role and the progression of web analytics down into five stages:
- Stage 1 – Site analysis: When we get started, we’re really just trying to get our arms around the data and the traffic on our site. The focus is to understand how visitors are getting to the site and what they’re doing there. But you also need understand why they’re there and whether they were able to accomplish what they set out to do. How do you do that? Avinash suggests that’s quite simple, ask.
- Stage 2 – Site optimization: The goal, of course, is to avoid analysis paralysis and look for ways to leverage the insight we are gaining about how visitors access and use the site to drive more visitors to the site, to optimize the experience of visitors once they are on the site, and to help more visitors accomplish what they were trying to do.
- Stage 3 – Segment targeting: As we continue to focus on improving customer experience, we inevitably start to look for ways to segment visitors into different groups either through data explicitly provided by the visitor or through insight inferred from the session and prior interaction data. We then apply the segmentation to customize visit experiences and target content.
- Stage 4 – Individual customization: At some point, our ability to continually apply finer segmentation and impact results levels off. That’s when we start to apply individual-level web interaction data to customize online interactions.
- Stage 5 – Integrated marketing: Of course, the holy grail of all of this is fully integrated and customer-centric marketing in which we seek to integrate insight from online behavior with what we know of an individual across other channels. And, we do this in order to inform and optimize all interactions – regardless of channel – with the individual.
The sad part of all of this is that few companies have matured their Web analytics capabilities beyond Stage 3. In fact, I’d estimate that 80% (not based on a quantitative study!) of firms are at Stage 1 or 2. Why? Well, it’s darn hard! There’s tons of data to wade through, the industry is learning as it goes, and the technologies that help marketers move up the curve are still pretty immature and poorly integrated.
So, how will this framework help?
Use the framework to understand where you are today and what you want to work towards and over what time frame. Each stage of maturity focuses on unique business objectives, requires a different level of analytical savvy, and demands different functional capabilities from your supporting marketing technology.
Over the next several weeks, I will continue to drill down on this topic with additional posts. Please add to the discussion by commenting and providing feedback on the blog or feel free to contact me directly.
Direct mail: Not dead yet (and won’t be any time soon) November 12, 2007
Posted by Elana Anderson in Customer Analytics, Database Marketing, Integrated Marketing, Marketing, Online Marketing.Tags: Catalog marketing, direct mail, direct marketing, Relationship marketing
7 comments
Thank goodness it’s Veteran’s Day — I have a USPS-free day to clean up all of the mail that is piling up all over my house. Must be the season, but I’ve dedicated a few posts to the direct mail industry lately (I promise that I’ll find someone else to pick on once we get through Christmas). Just to give you some more proof that direct mail isn’t going to die on the vine any time soon (article from Direct Magazine):
Early next year, Neckties.com going to make its first foray into direct mail, says Herschberg.
We have a direct mail campaign we’re going to be working on after the fourth quarter,” he says, noting that while the firm’s younger customers prefer to shop online, they tend to spend less than their older counterparts.
“People in 50s and 60s more likely to be swayed by combination of online and direct mail,” says Herschberg, conceding that the direct mail effort is “something of an experiment.”
Neckties.com is not alone. Per my previous assertion that ecommerce is actually responsible for increased direct mail circulation… I get a ton of mail from Netflix. If Netflix bothered to match its rented list to its own customer database, they would find that my household (thanks to my husband) is already one of its most active customers (my husband rents movies weekly and has rated over 1900 movies Netflix.com to date!). I have also recently received mailings from online mailings from ecommerce stalwarts like Overstock.com.
To continue my rant… The most ridiculous catalog I’ve gotten so far this holiday season is the one that was entirely dedicated to field hockey from Longstreth. I’m sure it’s a fine company, but my household has no interest in field hockey (I’d love to know where the shoddy analytics that determined I am into field hockey came from)…. The connection must have been that mouth guard I ordered for my daughter (as required by her SOCCER coach) through one of Amazon.com’s merchants…. My request to Amazon: Don’t just pass me off to the to the privacy policy whim of your partner merchants! Take some ownership and add functionality to your ecommerce site to allow customers to opt-out of catalogs and email when they buy from a partner.
Catalogers, green is in! October 24, 2007
Posted by Elana Anderson in Customer Analytics, Customer Experience, Database Marketing, Integrated Marketing, Marketing, Online Marketing.Tags: Catalog marketing, Database Marketing, Detail marketing, direct mail, direct marketing, Do not mail, opt-in
9 comments
Last week’s article in the New York Times about Catalog Choice got me thinking about the catalog industry.
Now a new online service called Catalog Choice (www.catalogchoice.org) is facilitating attempts to unsubscribe. The site was developed by three nonprofit environmental groups — the National Wildlife Federation, the Natural Resources Defense Council and the Ecology Center — to relay requests en masse to specific retailers. Since it was introduced last Wednesday, more than 20,000 people have registered.
Now, I know a little something about how a catalog operation works because I ran very large database marketing technology projects at Staples and Eddie Bauer in the mid-late 90’s. So, here’s my take…
The Internet is partially to blame for increased catalog circulation
Despite predictions that the Internet would decrease direct marketing postal mail volumes, a 2005 study by Forrester Research (disclosure: I edited the report) showed that 60% of high-volume direct marketers (those that mail 50M or more pieces annually) planned to increase their mail spend. What that report didn’t say is that the Internet is actually deserves some of the blame for the increase.
Maybe this bucks conventional wisdom, but think about it. In the old days, catalogers could only build their house file by buying lists and participating in cooperative data sharing initiatives like Abacus. Now, if someone comes and buys on my site, then of course I’m going to add them to my house file. And, I’m also going to add them to my list for my sister brands too. It’s a no brainer. So, today, catalogers still use tools like Abacus and they also assume that every online shopper also wants a catalog. Pretty presumptuous, don’t you think?
Well, today’s over marketed and increasingly environmentally conscious consumers won’t have it. That’s what gives rise to organizations like Catalog Choice. And, this is just the beginning.
The industry needs to take action
I definitely don’t have all the answers here. Catalogers are in a tough place and I sympathize. When each catalog turns a profit, it’s hard to come up with a business case to stop. But I think the industry needs to take the lead and start working on the problem. Here are a few ideas to get the ball rolling:
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Enable online customers to opt-out (better yet, IN) of catalogs on your site. You do this for email right? Technically you don’t have to –the CAN-SPAM law only mandates that you honor an opt-out. But, you do it because consumers fought back against email spam. So do it for your catalogs too (catalogs are a lot more expensive than email after all). It’s not hard to add another flag to your database that you check in your campaign list pull process. I am not aware that any retailers are doing this today – it’s time to start.
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Allow customers to limit the number of catalogs they receive. Some retailers I’ve worked with send as many as 60 mailings a year to a single household – that’s a lot of paper! Take the catalog opt-in a step further and give your customers a choice to limit the number of catalogs their household receives every year. Now, it’s up to you to figure out – through modeling and contact optimization techniques – which catalogs will drive the most return from that household within the customer’s set limit.
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Tighten up the deduplication rules. So, my husband and I don’t have the same last name. That doesn’t mean that we want duplicates of every catalog in our house. I had this argument with a client in 1995. The response I got was, “The catalog could be going to a sorority house or an apartment – we want to get as many eyeballs on each book as possible.” Well, with a little external data and a tad more technical elbow grease, you can easily determine that I live in a residential suburb in a single family home. So, please, don’t send me two catalogs and save yourself a tree and a few bucks in the process.
Sure, the ideas I’m proposing will limit your reach, but they WILL help the environment and be viewed as a step in the right direction by your greening customer base. You can get some leverage from this – publicize the fact that you are committed to being more green and helping the environment. But be careful with this part, don’t say you are green and fail to walk the talk – today’s consumer is watching and now has plenty of channels through which to be heard.
How [poorly] integrated marketing impacts experience October 23, 2007
Posted by Elana Anderson in Customer Experience, Integrated Marketing, Marketing, Marketing Technology, Online Marketing.Tags: Integrated Marketing, Marketing Effectiveness, Marketing Process, Sony Vaio
6 comments
I recently treated myself to a new laptop. A Sony Vaio – it’s chic, sleek, and tiny. After I got rid of all of the marketing crud – you know, the start up gobbledygook and free trial software, I fell in love with it. I love it so much that I also fell for the “Register and save 20% on accessories” offer that came in the slick little catalog insert in the box.
So, I went to the Sony registration site, fully expecting that after I provide a few nuggets of personal information I would be launched directly into a shopping experience worthy of Sony Style. Unfortunately, that was not my destiny…
First off, the entry form breaks all kinds of standards. For example, the birthday field isn’t marked as required but must be because, after several failed attempts with no error messages, I finally entered it and my registration was accepted. Whew! Now I’m ready for my Sony Style shopping experience…. Sadly, I was disappointed again…
Now what? How do I get my discount? After three days, my hunger for the cool accessories had not abated so I called the 800 number provided on the catalog. The polite individual I spoke to informed me that I should receive an email with a discount code. “No ma’am, you can’t order the accessories now and get the discount. If you ordered online, you should receive the email in a few days. If you don’t get it, give us a call back.” Sigh…
Finally, after 11 days (!!) I got the long awaited, “Thank you for registering” email. Here’s what it had to say:
Thank you for registering your Sony product on our web site. This email confirms you have successfully registered the following Sony product on our web site: VGNTZ150N
Name: Elana Anderson
Issue Date: 9/25/2007
Model: VGNTZ150N
Serial Number: N/AA Special Offer from Sony Card:
1500 Reward Points after your first purchase*
http://www.firstusa.com/cgi-bin/webcgi/webserve.cgi?partner_dir_name=sony_1500&page=cont&mkid=6RS3v
No, I don’t want a credit card! I want my 20% discount! Refusing to relent, I called the 800 number again. This time I explained my situation and the service representative agreed to take my order and give me the discount. Mission accomplished – FINALLY! What should have been a simple seamless process took two weeks.
Lessons learned
What does the Sony brand engender for you? If you are like most then great design, high quality, stalwart brand probably top the list. But my experience gives me a view into the inside: big organization, internal silos, and politics. The campaign I described here doesn’t have that many components — it shouldn’t be THAT hard to get right. But, this kind of campaign does touch different parts of the marketing department (people who probably don’t know each other and sit in different offices) and the broader business.
My advice? If you can’t get a simple integrated program like this right then don’t do it at all. Why? It damages your brand when you mess it up.
If you are running campaigns with multiple components that cross organizational silos then you need to organize the stakeholders and nail the process down. Understand the steps, define the handoff points, map the time between them. In the end, it’s all about the process. Ideally, a campaign like this is automated. But, sufficient testing is required up front to make sure it works. And, don’t forget to put some process checkpoints in place so that if something breaks along the way you get an alarm bell. You can have great creative (Sony does) but if the process is disjointed you lose business and look foolish.
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