Marketers Must Innovate as Economy Tightens

When times are plentiful it's easy for marketers to become complacent. As the economy becomes increasingly challenging every business is looking for new revenue streams. Now is an excellent time to evaluate your current sales and marketing strategies, and look for new innovative approaches. Yesterday, I heard a sales manager bemoan the recent drop in new customer orders. Yet it was apparent that he wasn't modifying his approach to new customer acquisition. As the economy changes, what changes are you making?

One way to consider new alternatives is to assess each of the traditional 4 P's and ask whether your offerings match the current times: Is your product offering appropriate or is there a new feature or way to combine your product/services for your target customer base? Are there new markets that offer new places to sell? Pricing is an obvious lever in tough times, but think about creative ways to bundle offerings rather than simple price competition. Think about all of the terms in your contracts that might offer new ways to be creative. Are your promotions communicating to your customers in the right way? Are they supporting your core value proposition or competing with that proposition?

Now is a great time to evaluate your marketing approaches to maximize return on every dollar spent.

Yellow Pages ROMI versus Online Marketing

A new thick Yellow Pages book was dropped on my front lawn this week. The two thoughts that immediately entered my mind as I bent to pick up the book were: 1. Where will I put this huge book?, and 2. How much money have all these firms wasted? With the exception of perhaps some very local retailers, most of the money spent on ads in the Yellow Pages has been a waste. If you need a number, find it online. If you need to find an address or hours of operation, check the company website. The premium for Yellow Pages ads is just too high. If you're a samll business and want to fund an online marketing effort, cancel your Yellow Pages ad reallocate those funds.

Marketing return during slow times

As the economy continues to struggle business investment will decline, furthering the economic woes of 2008. Marketing spend will be a casualty. This need not be bad news for marketers, except for those locked into an old model where success is dependent upon size of budget. Successful marketers will be fine-tuning programs to demonstrate and expand programs with positive ROI. Not measuring return on marketing investment? What's your excuse?

Negative Advertsing in Politics versus Consumer Brand Marketing

One further comment on politcal brand marketing. See the excellent comments at http://hbswk.hbs.edu/item/5937.html which discusses the role and value of negative advertising in political elections versus consumer product marketing. From my perspective, the zero-sum winner-take-all nature of elections differs markedly from the consumer marketers trying to grow categories and take share from competitors in an environment where products rarely change formulas and no formal deadlines exist.

Democratic Party brand value proposition

Stepping aside from the typical post about Marketing ROI, today's comment is on political branding. Regardless of your politcal inclinations, it's a fascinating situation to watch from a brand marketing perspective. Did you see the speeches by Hillary and Bill Clinton over the past two nights at the Democratic convention? It's a classic case of attempting to integrate all brand messaging into a cohesive brand value proposition. In this case, built around the candidacy of Barack Obama. The brand messaging has been fractured in a highy public way during the competitive primary season. As with any brand shifting it's core communication, the key question is whether the target audience finds the new messages (from Bill and Hillary) relevant, cohesive, and believable. For the Democrats, time will tell. For your brand, is your messaging consistent?

Online Marketing ROI: A Web Site ROI Mental Model

Mental models and analogies often help explain software and technology when experts are explaining solutions to business owners who are not technical experts. One of the dangers is that as technology changes those mental images must adapt to reflect the new state. For the past decade the primary mental model for the traditional web site has been a traditonal house. Thus, the use of the term "Home Page" as a point of entry to a web site, with a variety of rooms for "Visitors" to "Enter". We spend countless hours perfecting our Home page because we know that the entrance is the most important moment to make a positive impression.

The model has changed. The rapid evolution of Search as the primary method of traveling the web and the advanced use of SEO tools to drive users to pages of a site means that many visitors to web sites no longer visit the home page as the point of entry to the site, if at all. I sugges that that the new mental model in no longer the Home, but the Apartment building. Any particular visitor may visit any particular apartment (page)as the point of entry. As the site owner, all of your apartments must be optimized and prepared to make a positive impression on the visitor, and each apartment (page) must consider where you want the visitor to go after completing the visit to that page. So, maximum ROI from marketing investment in the web site must consider optimizing across the site and not simply the Home Page.

Let MarketingWitz know what you think about this updated mental model.

Marketing ROI: Don't Talk to Strangers

One of the most basic lessons from childhood applies to internet marketing strategies as well as how to behave as a kid. Remember being told "Don't talk to strangers?" Apply this lesson to your internet marketing strategies to generate increased ROI. Collecting visitor and customer data is important to help segment your audience and then communicate effectively to each segment, and personalizing your communications will generate an even stronger conversion rate. Aberdeen Group has validated this in a recent study, concluding that personalization improves response and is an effective tool used by best-of-class marketers. So, get to know your site visitors, invite them into the site, capture user data, and communicate with these visitors in a way that reflects and demonstrates an understanding of their needs. This will result in increased conversion rates and improved ROI. In short, talk to your audience and don't talk to strangers.

Transactional Consumer Data can drive Marketing ROI

Credit card companies and other firms with transactional data mine that information to generate targeted marketing communications to generate high ROI campaigns. As marketers this is what we try to accomplish. But let's take the power of transactional data farther. What if, in addition to marketing to consumers based on mining transactional data, we put the informative power of the information into the hands of our consumers? Scary? Perhaps. Consider this. If MasterCard, Visa, or American Express were ubiquitous and able to capture all of my transactions (ok, Amex may not have the retail footprint), and track changes in spending behavior, what would it be worth to me to view these trends? I'd certainly be open to using my MC or Visa exclusively to be sure the analytical information delivered to me represented my full spending.

Think about the power of this exchange: In return for my commitment to increase my 'share of wallet' (transactions) with my credit card provider, they deliver to me compelling information about my spending behavior patterns. Suddenly, my credit card provider is an asset as my partner in managing my lifestyle spending rather than simply being a transactional cost center. By changing the thinking and approach to how the data is used, this could take the relationship to another level and generate a powerful ROI to the credit card firm.

Note that this could also work in other realms. If my local grocer provided a comprehensive analysis of my grocery shopping trends (think of charts similar to your mutual fund reports) I would be more willing to provide 100% share of my grocery shopping to that grocer to ensure that the information accurately reflects my total behavior. (Hey, I've been eating more veggies, and less meat....but I'm buying more ice cream these days.)

The key point is that marketers can enhance ROI by recognizing the power of the data that they own and how that data is presented to customers.

Brand Value

Brand marketers can learn about ways to drive the ROI and value of their brands by learning from other disciplines. For example, in the world of business acquisition and sale the factors that are used to analyze core business valuation can be used to assess the strength and potential ROI of an existing brand. Buyers and sellers will conduct a SWOT anaylsis of the business, just as brand marketers anlayze the competitive strength of brands. In the acquisition world, the multiple used against EBIDTA is generally larger for larger businesses than small businesses. So to, this general rule might be applied to evaluate the relative strength of a brand. Larger share brands are generally (although not always - strength in a key niche can be valuable) more valuable than lower share brands, and there has been sufficient research conducted to document the strenght and added value of being the share leader. Business valuations typically also look at the concentration among key customers. Too much business with a core customer may lower the overall valuation because of the increased risk. This holds true for brands - too much concetration with WalMart can be dangerous for the brand. Business valuations may be lower for business where the owner is sole rainmaker and future sales are at risk when a change in control occurs. For brands, brand value may be at greater risk when a brand spokesperson or long-term brand leader has too great a role in the personality of the brand. So,take a moment and see what you can learn by looking at your brandin the eyes of a potential buyer.

Marketing Benefits the Community

Today's Post is a bit of a diversion from our core topic, but still an observation of Marketing. I was in attendance at a local awards ceremony last evening where organizations were being honored for programs that represent collaboration to enhance the local community. It was great that four recipients were a collaborative client team that I've worked with, but what influenced me as I listened and learned about what various organizations were doing for the local community, was that it reinforced a fundamental belief that there is a great deal of good to done in the world. And, importantly, the marketing professionals can and do play an important role in many of these achievements. As I listened, I was encouraged by the passion and commitment demonstrated by the individuals who comprise these collaborative efforts. So, my message to everyone today is that while marketing may often be demonized and, at times may be used for less than honorable goals by less than honorable people, marketing can and is often applied for the betterment of consumers and citizens. Go Marketing!

Will brand personalization generate profit?

Interesting comments are popping up in the marketing literature regarding the advent of personalization of brands. This trend has been growing over the past several years and has become more prominent as technology permits efficient implementation of persoanalization. Jim Holbrook, CEO of eMak, summarized the shift toward personalization of brands in a recent eMak e-mail, saying "Now its about brands conforming to consumer preferences, rather than consumers being conformists." In other words, why wear an Izod logo shirt or a Nike cap, when you can personalize your blue jeans to your exact style and size, wear a personalized cologne, and create your own pizza combination (including naming and posting the pizza combination for others to view)?

As consumer marketers, this trend toward personalizing the brand experience is exhilirating because of the many marketing opportunities that it creates (can't you feel the energy of the agency creative teams buzzing on this topic?), but care must be taken to ensure that both short and long-term ROI can be generated from impact of personalizing the brand. Can it be achieved? Yes. But not in every instance. Marketers should evaluate the cost structures implicit in personalization and ensure that the consumer response will justify the operational impact. Ask whether the personalization of the brand permits the brand to command a premium in the marketplace.

Marketing Dashboard

A Google search on "Marketing Dashboard" generates 285,000 responses. That's a phenomenal number given the relatively few businesses that actually use a marketing dashboard.

After speaking with several marketers recently about the use of dashboards, I came to a seemingly obvious but critical conclusion. A dashboard is only as good as the data feeding it. A marketing dashboard is only useful if it ties to the marketing objectives and performance goals of the organization. Without this connection between marketing data, marketing objectives and business performance metrics, the dashboard is only a sexy gadget. Generally, marketers love gadgets. But this one won't gain you any support without the proper alignment.

A short but nice overview of marketing dashboards can be found on Chief Marketer. Of course, you could also read the 285,000 links on Google.