Analytics is a great tool for helping us make decisions and take action. As a representation of behavior, it helps us respond to customers and see the impact of our actions. However, analytics only represents “what” but not “why” people behave in the way they do.
For some marketers this is a blind spot. Over dependence on numbers leads to paralysis or to erroneous decisions when working with a blank canvas and are absent the necessary intuition to provide the initial direction.
While we spend much time discussing analytics and big data, the reality is that the majority of businesses do not have deep stores of data on their customers, yet have to make decisions about how to approach the markets.
In this situation creating a starting point based on an understanding of the industry and an intuitive sense of the market, combined with tracking and analytics, is the best way to get moving. Since you are not starting with the answers, you have to implement programs in a way to derive the answers.
One approach is the “shotgun” approach and see what you hit. With careful tracking we can identify the segments, messages, campaigns that have the best chance of success while weeding out the elements that do not work. This approach identifies the opportunities relatively quickly but has a heavier upfront expense.
A second approach is to trust more on the intuition and start with more focused, smaller opportunities, and roll them out over enough time to determine if they can work. If not, move to the next idea and do the same. The greater one’s understanding or intuition, the more likely the right ideas will be first on the list. This approach has lower cost implications upfront, allows for applying what was learned but may take longer to find the best opportunities.
As we get more and more dependent on data, the art and intuition necessary to be complete in marketing is becoming rare. We have to be uncomfortable when faced with a lack of information and develop creative ways to kick off the marketing programs while gathering data along the way to better inform the next iteration of our activities.
Digital analytics and more precisely, how a company uses digital analytics is a focus of mine. Over the years I have seen very smart people with access to very sophisticated analytics programs feel paralyzed by their own ignorance. Whether it an inability to measure their own results or the lack of visibility into what others in their organization are doing, they don’t have the confidence to make decisions and take action.
On the flip side there are some very “junior” people making some very wise choices directly as a result of their access and understanding of the impact of their own actions. Information truly is power.
I had the great privilege of traveling from Europe to Asia to run seminars on how to apply digital analytics in day to day operations. I saw first hand how information empowered people, and lack of information stymied them. The key difference was not the tools the companies use but the culture of the companies who used them properly.
Based on experience and observations, with a strong grounding in the content of my seminar, I’ve written a book about digital analytics. Specifically what a company needs to do to implement a culture of analytics.
The book is not a long book, but I do think is can be helpful in guiding individuals to affect change within their organization. It is not about any specific analytics program or application. Rather I focus on the human aspect of analytics and making the application of analytics ‘real.’ I firmly believe that the greatest asset of any company is the group of people who show up everyday and want to make a difference. All they need is the right set of tools. Digital analytics is one of those tools.
WOM, word of mouth has long been a powerful force in the making (and breaking) of products and companies. As the force has moved online to become known as eWOM marketers have struggled to understand the dynamic it plays in the material affect on their sales. A culprit in perpetuating this struggle is the monolithic view of social media that serves as the proxy for eWOM among many.
“A Meta-Analysis of Electronic Word-of-Mouth Elasticity” in The March 2015 Journal of Marketing, provides a great deal of insights into the phenomena of eWOM. As we contemplate the results, there are some things we could derive based on our experience with current customers, our sales process and our ongoing dialogue within the industry. In other words, common sense is finally backed up by analysis.
Durability and Trialability are two key attributes for the impact of social media. As the former increases and the latter decreases, the need for deep information from credible sources becomes increasingly important. If the consumers keep the item for a long time and they don’t have the ability to try it before they buy it, they dig deep into the available resources.
A key component of the information they want is expert in depth analysis. Reviews that say “Great Car! I loved it.” are not very helpful. The consumers are seeking information from authoritative sources, experts or consumers who express details about their experience.
The research efforts of the consumers during the purchase process are intended to mitigate knowledge risk. The more costly the items, the more valuable the incremental knowledge becomes. Thus, consumers will spend a great deal of time researching durable goods.
The implications for marketers extend to the pre and post purchase with eWOM.
For durable goods, marketers need to identify authoritative third party sources and ensure they have the right / best information. They can’t be bought, but they can be educated. Providing one “authority” with access and a “trial” with the product can directly influence thousands of potential buyers. Marketers need to identify the authorities in their area, monitor them and educate them and their audiences. Of course, this assumes a quality product and service to start with.
Post sales support needs to be strong and obvious. Reviews, publicly requested service inquiries (twitter “help line” for example) need fast and valuable responses. Private requests need equal attention to ensure they do not become public issues.
For durable goods, marketing resources need to be prioritized to mitigate knowledge risk for potential buyers. While cute social games, contests and share-fests are fun and can build communities, this activity should be second to building the experts’ product familiarity, in depth reviews and clear post purchase support. It is not the number of mentions that count, but the value those mentions have to potential buyers.
The WSJ article on Facebook’s sales lift research is a new bow on an old, old package. Using post impressions studies to calculate the lift in sales derived from advertising was being used over 25 years ago.
While I applaud the continued push to connect online ad expenditures to off-line results, articles like this in the WSJ make it seem like digital marketers haven’t been thinking about this for decades. Now that Facebook is now putting money behind methodologies that have been around for well over 30 years, it is being treated as some kind of new concept. Keep on studying, but lets not kid ourselves, this is old school research applied to ‘new’ media (I hesitate to call internet advertising new anymore.)
Apps are so shiny we can’t see the problems they (and we) face. I wrote before about the reliability of location based technology and the issues apps have in accurately locating users. This is an issue for advertisers who rely on location targeting. For consumers these poorly performing apps can be frustrating.
But if the report by IBM and Ponemon on app security is an indication, users have a great deal more to be concerned about than being misplaced by apps.
Apps can hold or be a pathway to sensitive data. The study estimates that 11.6 million phones were infected at any given time by malware last year, putting 1 billion personal data records at risk.
The primary cause of the breach, little or literally no mobile app security screening by the app developers. This includes fortune 500 companies. Its is not just the independent developer out there, it is the large companies whom we tend to trust (naive though its proven to be).
Some interesting facts as seen in IBM’s info-graphics (available here on flickr). Note how 40% have no budget allocated to app security. Many of these companies are providing the apps to their customers. This lack of attention to app security speaks volumes about the companies concern for their own customers.
IBM – 40% don’t scan code33% never test apps for security.50% have no budget for testing security of apps1 billion personal data records compromised
Your local search program is buttoned up. You’ve got your location information just they way it should be. It’s clean and accurate with the phone numbers, streets, directionals, numbers and your schema code is all correct. You even have your location meta data all set.
You’ve personally reviewed the information in all your accounts with the big search engines, local sites, and it looks good. There is nothing on your web site that doesn’t match what you’ve distributed to the aggregators or mapping sites. Search engine crawling shouldn’t be an issue.
All’s good. Your customers can find you and you can go on to your next project. Or can you?
You think you’ve hit the target. But, it’s not a target you needed to shoot for. Its another moving object…. the consumer.
Local search marketing is more analogous to trying to make two arrows hit in mid-flight than it is to hitting a stationary target.
Between your nice clean data and the consumer is the messy, dirty world of apps, mapping algorithms and sensors. They follow the consumer around and when the consumer tries to find you, these applications start trying to pin down the location of the consumer. And thats where the fun begins.
You’ll hear the services talk about how precise they are. They can locate people down to the city, neighborhood or block. But they are not locating the person. What they are doing is taking in the data from the sensors (GPS, IP, WiFi, cell towers, registrations etc), running that through their own programs, and then calculating where they think the consumer is.
The data may allow them to calculate a precise location. But, if the data is bad, it is precisely the wrong location. This, combined with the uncertainty of the technology being used creates an exponential problem of inaccuracy.
This is the focus of a study by local technology company ThinkNear’s: Local Score Index. According the the study, as the proliferation of apps with location based functionality grows, the accuracy of the overall location ecosystem decreases. For advertisers, this become problematic when going through an exchange or blind network.
We may see CTRs drop as a result of users seeing ads for our businesses when the store is not actually close the the user. The apps in which the ads run become a problem which we need to mitigate through more time and effort in manual optimization.
Perhaps worse, the user clicks the ad, sees how far of the location really is and then bounces. The feeling the consumer has from the bad experience is not limited to the app. They associate your company to the feeling as well. It is more than a wasted click, it is erecting a barrier between you and the consumer. If it happens often enough, the barrier will be too high for the consumer to see you; they’ll ignore your ads in the future.
What to do The deal
Stick to proven ad serving technology or negotiate performance (conversion) based deals with newer companies. Ultimately, we’d like everything to be conversion based, but that is easier said than done. However, if you are going to take a risk on a new network, then the deal has to protect you from the likelihood that the technology is still being tweaked.
The ad
While we like high CTRs, not all clicks are created equal. If proximity is truly key to the success of your campaign, then your ads need to reflect that. Let the user know where you are before they click. You may end up with a low CTR and ultimately, low impressions as the networks optimize you out of delivery. But, that is better than paying for clicks that don’t convert.
The analytics
Track EVERYTHING. Your ad tags should be to the most minute degree possible. If dynamic tagging is available, leverage it. The key to optimizing is nuance. The more granular the data, the better optimization you can achieve. Within a vast amount of bad impressions and clicks are some nuggets of gold. Without the right tracking, you’ll throw those out with the rest of the network.
Normally I tell clients that online marketing is not rocket science, its just hard work. But local search introduces a level of technology that can seem incomprehensibly complex. To manage campaigns around this, stick to the basics. It sounds odd, but the key to managing highly complex delivery technology is to stick to the mundane foundation of basic optimization. Track it and even the most complex programs can be managed and optimized.
Omni-channel is described as a seamless experience for the consumer regardless of their mode of interaction. In other words they and your employees have the same product, options, pricing, delivery and service options no matter where they are in your brand / purchasing ecosystem. All customer history and preferences are available online, to your operators (phone & chat) and in your brick & mortar locations. At no point does the customer have to “re-educate” your employees on their history with you, and at no point do your employees have to explain why “we’re different” in the store than online. No matter where customers and employees are, access to information and capabilities is the same.
In any case, how do companies start down the omni-channel path? Broadly, there are two areas companies have to tackle. One, cultural / organizational and the other technical. Before tackling the latter, companies need to address the former.
An Omni-channel Culture
There are several cultural impediments to an omni-channel experience and any one of these can trip up the effort to roll it out.
Us vs them.
I’m not talking about your company vs the consumer (if thats an issue, you’ve got bigger problems). I am addressing departments vs departments or silos within the company. Some of these tensions are organizationally driven. Major retailers still segment their online store from the off-line stores with separate inventory for in-store vs online (which I understand, but…), and the two cannot leverage the whole; customer are turned away because they don’t have access to inventory within the company. I’ve also seen online departments that only get credit for sales through the online channel and don’t derive benefit or credit from sales to the in store channel on which they assist. Assets and benefits need to transcend groups or departments so that internal barriers do not interfere with the customer experience.
Beyond the sales channels, there is often tension between sales and support services or accounting / billing. This tension is often a derivative of no unifying mission and results in the “its not my job” mentality, often supported by intentional technical barriers between departments. How often have our calls been transferred from sales to billing and we have to re-introduce ourselves and our issues? When this happens, I am told that “they are on a different system.” While this is a technical issue on the surface, companies need to ensure it is not the result of a policy that requires the barrier to exist.
Margins rule
There was a time in sales when every salesperson was directed to “get the most” out of every sale – milk it for the margin. When companies look at pricing strategies, the same perspective seems to apply. The online pricing and the in-store pricing is different. Sale prices online are not available in the store. This stems from either a disconnect between the two, or an attempt to squeeze margin from one place at the cost of a cohesive customer experience.
There are legitimate reasons for different pricing strategies online vs in store, geographically or even time of day. As companies consider these strategies, they must consider them within the greater vision of an omni-channel experience for their customers. If the pricing strategy does not support the vision, then it should be forsaken, even at the cost of short term benefits.
Companies need to take the long view of the customer relationship and standardize pricing in order to be ready for the omni-channel experience. Temptations to implement short term ‘fixes’ need to be avoided. For line managers, pricing adjustments (up or down) are an “easy’ tactic. Senior management must establish the culture that dissuades this behavior. Its not easy, but an omni-channel experience requires it.
Short term value
When we implement a new program we are often impatient about seeing results. This can have a devastating affect on omni-channel initiatives. We have two instincts to mitigate.
First, the impact of omni-channel is not immediate. Consumers might not be aware of it right away as they tend to only notice when things go wrong. They won’t notice a lack of conflict between online and offline, or the seamless transfer of contact from one department to another. They’ll simply accept it.
What is key is that we’ll see the attrition of customers decrease over time as we mitigate their frustrations. If we are fortunate and our competition has not successfully adopted an omni-channel approach, we can even capture some of their customers. When we implement omni-channel we must guard against our desire to see an immediate and big change.
Second, our employees who may have been focused on ‘closing the sale now’ must accept that this is a brand’s customer and the relationship transcends the transaction. It is okay if the customer needs to take a step back or do more research. It is okay if they shop in store and buy online later or the reverse. The shopping experience is not limited to the store or the website; it covers a longer period and will likely include both. With patience we may create more sales over time while nurturing the customers wherever we are in contact..
Starting with culture
Like so many things, the technical challenges, though not trivial, are not the challenges we need to tackle first. Our companies, our cultures need to be ready first. No matter the technology, it is about people. Give your employees the right tools, in the right culture and you will have customers for the long haul being nurtured across all interactions.
Getting ready for spring, Google will help clear out some of the account junk you’ve accumulated over the year. Starting March 23, unused ads over 100 days old will go away. This is a good move, but if you are not aware, then you’ll be surprised by what you don’t see in the last week of March. But of course, now you are aware. So, no surprises.
I’ve often cautioned clients about “over consuming” data. I’m a data geek, but I know that data you can not use often clouds the data you can.
The news that Google Adwords is reducing the number of columns (Google, the data Geek of the world) because advertisers are confused by too much adwords data shows that even the biggest fans of data recognized the limitations of unlimited data.
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