by Richard Fouts | September 23, 2013 | 1 Comment
This quote from Damian Kimmelman, founder of the disruptive data business Duedi, reminds us why building transformation expertise into the organization is a leading priority.
In 1958, corporations on the S&P 500 had remained on the index for an average of 61 years. By 1980, that had fallen to 25; today it’s just 18 years. This means every marketing organization, large and small, needs to build transformation expertise into its capabilities, both in its internal talent and its ability to source talent from external experts.
In our survey of digital transformation consulting firms, we aggregated several pieces of sage advice from a group of firms that have collectively delivered hundreds of digital transformation engagements. Gartner clients can read the full document here.
One of the more common pieces of advice: If your legacy business is threatened by digital, don’t just hunker down and keep doing what you’re doing, claiming that the digital startups that are challenging you aren’t the future (they are) Rather, do what you’ve done before: leverage your strengths. The value proposition that has worked for you (and that your customers are still willing to pay for) doesn’t go away. Sure, it changes in a digital world, because your customers want to engage with you differently – so extending your core business with digital techniques should be a no-brainer.
But sometimes it’s more drastic (and complicated) than that, especially when digital startups have figured out entirely new ways of engaging and stealing your customers.
In these cases, you can launch your own digital startup alongside your legacy business – using your shared services model to support both organizations. It’s a popular model being used at The New York Times, Deseret News, Nike, Audi, Delta and scores of retailers (You can read more about this approach in our research note How to Approach Digital Transformation).
It takes courage, conviction, creativity and grit to run a startup alongside a legacy business. And – when such a model exposes opportunities for growth that can be integrated, in whole or part, into the primary business — the change management task is extraordinary.
Or is it?
The Deseret News, for example, called on Innosight (a strategy and innovation consulting firm) to help launch its new digital startup. The Deseret News’ existing shared services model was used to support both legacy and startup businesses. This approach provided a natural change management solution by exposing legacy employees to new ways of doing things in more natural, gradual way. The result digital business is now 25% revenues. And while the organization’s 150,000 legacy subscribers is impressive, Deseret Digital receives three million visitors per month, changing the organization’s market position from local paper to a national resource for an expanded audience.
Transformation is hardly a one-time initiative. Today’s rapid pace of change is the new normal – and in the 21st century, marketing executives can expect transformation issues to re-emerge in a few short years (especially as The Internet of Everything, wearable computing and trends in massive customization continue to mature).
Category: Digital Marketing Tags:
by Richard Fouts | August 21, 2013 | Submit a Comment
Remember the days when television networks signed off at midnight? That changed when TV executives decided to fill the air waves 24/7, from then on. But these same execs also realized they couldn’t just spew random content; to they adopted a programming cycle starting with morning news, weather and sports – moving to daytime, prime time and late night.
Today’s content marketers have a similar cycle; many map content to the buyer’s path to purchase. For example, content applied to awareness marketing might include stories that defend a point-of-view or scenarios that convincingly describe how an emerging trend might play out. If buyers find the story relevant and useful - they advance to interest and desire, where content gets even more relevant, more personal. Creative content not only captivates customers; it helps drive them to purchase.
But first, the vision thing…
Gartner sees a lot of well-intended marketers dive straight into content marketing’s creative process at the expense of crafting vision and goals (it’s understandable; the creative side of content marketing is more fun; see also, http://blogs.gartner.com/jake-sorofman/building-a-content-supply-chain/)
If this describes you, in full or in part, take a step back and formulate your vision for content marketing. How can your leading business priorities, your burning marketing objectives become more wildly successful with skillful application of relevant content? Now set some goals. State the business metrics you’re trying to impact (by how much and by when) by applying content to your marketing initiatives.
Now the creative…
Armed with vision and goals, you can now get as creative as you want, by exploring the many ways you can strategically execute your vision. GE for example, in its campaign to sustain its image as an innovator, hired documentary filmmakers to trace the personal and financial investment (and inevitable setbacks) of innovators that changed the world.
They end with well placed calls-to-action, inviting a closer look at the setbacks and victories that come from GE’s own innovation labs. The message couldn’t be more clear: GE gets what it takes to traverse the financial rigor and emotional demands of innovation.
Others make content marketing interactive. Audi for example, skillfully uses its content to move buyers from interest to action with its showroom of the future, letting buyers explore the Audi fleet in detail. Buyers are then offered tools to design and select their own Audi, guided by their lifestyle preferences. Next, they’re shown content that details pricing, cost-of-ownership analyses – and finance and leasing options. Audi uses its content to drive buyers to an outcome. Delta Airlines provides another example. Like Audi, it lets travelers envision a personal outcome, by describing a dream vacation at its many travel kiosks in airports.
Making this happen is not unlike the editorial process you see at any publisher, whether print, broadcast or multimedia. CSC for example, has done a wonderful job installing a newsroom-style organization, complete with producers, managing editors, writers, and artists (view their organizational strategy in our note on marketing organization design, here). Also, if you’re a Gartner for Marketing Leaders subscriber, read why “Content Marketing Pushes Digital Marketing to Adopt Newsroom Habits.”
Content marketing provides a powerful fuel for your all your initiatives. But it happens best when based on a vision and a strategy for what my Gartner colleague recently described as continuous storytelling. Like television broadcasters, content marketers need to plan their line up with the goal of drawing in, engaging—and delighting—their audiences.
Category: Brand awareness Tags:
by Richard Fouts | August 9, 2013 | 3 Comments
Remember when AdAge asked its readers, “What viral ad made you cry?” The response was fantastic. Consumer marketers don’t apologize for the emotional threads they run through their promotional fabric; their customers seem to love it; and consumer marketers have fun with it.
But, while consumers LOL over Budweiser’s swear jar ad or sob over its Clydesdale story, a business buyer would likely be committed for crying over an offer from Ernst & Young (or at least sent on forced vacation).
B2b marketers are okay with scaring you (insurance companies love that one) or making you fear for your job if your systems are hacked (security firms love that one). Fear seems to be the one emotion that doesn’t scare b2b types. Ironically enough however, b2b buyers say they avoid ads that use fear because it feels manipulative.
Why is emotion such tricky stuff for b2b types? There’s the obvious answer, that emotion isn’t cool in business (remember those books on emtional IQ?). And – business buyers craft procurement processes that are deliberately designed to drive emotion out of the decision. Purchase recommendations are backed by cold, hard logic manifest in spreadsheets, scorecards and management memos.
Why then, do so many of clients tell me they bought from Vendor A versus Vendor B because they “just felt better about them?” Because, unless you’re Mr. Spock, you’re an emotional being whether you’re buying a car or an analytics package. Why? Because as a business buyer you care about your role. You’re passionate about your job, you care about your organization, and you care deeply about getting the best deal especially when you have limited budget (and who doesn’t have that?).
So, if you’re a b2b type, start secretly violating the procurement process of your customer. Don’t fear their emotional realities.
Category: Brand awareness Digital Marketing Personal selling Tags:
by Richard Fouts | August 8, 2013 | Submit a Comment
Simplicity. You don’t have to go far to hear buyers complain that the path to realizing product benefits is often highly cluttered. Sometimes just buying the product is fraught with obstacles.
As consumers, we want choices; lots of them. This is usually at odds with simplicity; in fact it’s the primary challenge of experience designers everywhere. This idea - “give them what they want, but make it simple to make a final decision” played out in a grocery store. On one table sat 24 fruit juice combinations, on another sat the four “most popular”. While the crowded table attracted more interest, the uncongested table sold more juice.
If there’s a lesson to be learned - it’s the dangers of scope creep.
Steve Jobs for example, was famous for asking product designers to de-scope features, then de-scope again until they reached a point where the value proposition took an obvious decline. But his philosophy, which unskilled designers often don’t grasp: less is more.
Low tech versus high tech
I called Nordstrom the other day; in one ring, I heard “Good afternoon” followed by an instant response to my request for Men’s Suits, which answered in half a ring. Contrast this experience with Bloomingdales, where I endured phone tree hell to reach the same outcome in more time by suffering more aggravation.
Technology is often the culprit. Nordstrom descoped their simple answering method by ditching the automated answering, call disbursement system they once had. The result? Customers get to their desired outcome in seconds along an uncluttered path.
Do people yearn for more simplicity? Easy answer (yes).
If you’re in product management, there are three exercises you might try:
Explore how a de-scoping of features could lead to a more efficient experience, and one that is more enjoyable. Look at how JetBlue gets travelers to where they want to go more efficiently and more pleasantly than United with a less-is-more approach to the user experience.
Try the 3 x 3 exercise. What does your customer do three minutes before they use your product, and three minutes after? Such an exercise caused Thomson to re-vamp their product portfolio, including the way its priced and distributed. No kidding.
And of course, try using your own products.
Category: Digital Marketing Tags: JetBlue, Nordstrom, Steve Jobs, user experience, UX
by Richard Fouts | July 29, 2013 | Submit a Comment
If such advice existed, every TED talk would win an award. The fact is, there’s no killer advice about this topic, though presentation consultants could fill a library with their tips, tricks and “must have” techniques for delivering killer presentations.
Trust me, having spent years reading this stuff and having given my share of boring presentations I speak from experience. For those of you that haven’t forged these rivers, I’ll save you some time and ironically, share my top five.
First, you must select something relevant where you have something original to say. Telling people what they already know is the most violated principle of deliverying good presentations. When you look at your final deck, go through each slide and ask yourself: “Am I telling my audience an old story?”
If there’s any doubt, find a deeper level of insight you can share (or share the moment that changed your thinking about your topic). If you must re-hash old territory, say something like “by way of review,” in your voiceover to let your audience know you’re setting things up (with facts you know they know).
Second, you must narrow the scope of your presentation, then narrow it again. Trying to cover too much ground is the second most violated principle in any presentation. If you have a huge amount of ground to cover, fear not ….just find the one sliver of thought you want to amplify. For example, a presentation on business transformation is a big topic, and if you find yourself presenting something this ambitious, explain why traditional approaches to initiatives like transformation don’t work. Talk about the approach business transformation initiatives require versus all of the big sweeping reasons one should transform. This brings us back to knowing your audience. Start with the assumption that they want to transform, then get into the approach that works, and the approach that doesn’t. Try not to bore the audience with transformation lingo they’ve already heard.
Third, expose your passion of why your topic interests you, and why the things you’ve discovered are so mind blowing that you just had to share them. Seriously, if you think you can’t do this, there’s a documentary about the history of concrete you might watch. You’ll be fascinated to see how concrete has played a critical role in the economic development of great nations. Anything is interesting if you look under the covers. If your passion about your topic isn’t authentic, you’re dead before you start.
Fourth, quantify the impact your topic is having (or about to have) on the people you’re talking to. If there’s no quantifiable impact, you’re not talking about anything worth solving, worth exploring, worth thinking about. Sales calls that don’t quantify impact end in “thanks for coming by” versus those that end with, “I want to learn more, I need to learn more, I must learn more.”
Fifth, turn off the PowerPoint, look your audience in the eye and take them through your journey, also known as your storyline. Most of you will ignore this one, because your cultures demand presentation slides. But just remember, history’s great orators weren’t big on PowerPoint. If you need a 12-step program to implement this advice, use slides in spurts. Talk to a slide or two, let the screen go dark while you engage your audience with a personal story. Then, if you must, bring up another slide or two. Think of this practice as the cup of decaf you interleave throughout your day to deal with your insomnia.
As I was going up to the podium at the American Marketing Association a few years ago, the light bulb on the projector exploded (scaring the audience I might add) and no one had a spare. The conference organizer turned white with panic, but I converted the presentation to a Q&A (which is really the part audiences like most). Half the audience came up to me after, exclaiming, “I’m so glad the projector failed. This was more fun, more informative, more real.”
Now, go kill your audience.
Category: Digital Marketing Marketing communications Tags:
by Richard Fouts | July 23, 2013 | 2 Comments
As HBR reported a year ago, solution sales people (those that solicit buyer problems, then serve up standard solutions) are consistent low performers. High performing sales people search for business roadblocks the prospect may not even be aware of, offering up insight versus canned solutions.
Though it’s one of the best studies on selling I’ve seen in recent years, many sales organizations haven’t adopted its recommendations as evidenced by a more recent study from Accenture that found that only 12% of sales executives believe their prospects and customers perceive them as trusted partners. In fact, the majority of sales executives say their customers view them as vendors or suppliers. Seventy percent of sales executives surveyed in the Accenture study also admit that they have yet to develop strong relationships with their customers.
These responses are clearly coming from old-fashioned, solution sellers.
Granted, there is still plenty of room for product sales that solve point problems, and if you’re a commodity sales organization, the solution sale can work. Most of you however, say you’re not selling commodities. So what’s next? How do you break out of the solution sale, which is the culprit driving you into a commodity sale?
First, you might have to re-assess the current sales force. Leading marketing and sales executives have told me for years, “the time and effort we spent trying to migrate old fashioned solution sales people to consultative, insight sellers didn’t pay off and we ended up replacing them with those that already get it.”
Second, stop feature selling. Focus on outcomes, experiences and buyer stories that reveal how you supported the customer’s business outcomes, especially those of a strategic nature. Good business cases don’t feature products, they feature business outcomes.
Third, get a consistent thought leadership program in place, fueled by a content marketing factory. The days of the occasional white paper are over. You’ve got to have a steady stream of thought emanating from your marketing programs that focuses on the future. Sure, buyers want to address current issues, but they are more interested in positioning themselves to compete tomorrow.
Last, think hard about how you help your customer compete. In the words of one executive buyer I talk to regularly, “If an investment doesn’t help me compete, why am I making it?”
Category: Personal selling Tags:
by Richard Fouts | July 8, 2013 | 1 Comment
Gartner’s digital marketing transit map offers a tool for communicating complex information in an intuitive way. Neighborhoods represent functional regions that can be thought of as practice areas within an organization. Tracks connect these regions, and can be thought of as application services that share common objectives and information.
Click on Web Ops, and the analytics track comes up front-and-center. It’s one of the most interesting tracks on the map simply because the ultimate digital marketing dream – assuring every offer is the next best offer – depends on analytics, particularly the type that predict how a customer or prospect will repond to an offer.
E-commerce operations are particularly good candidates for this technology since predictive analytics provide far deeper insights behind customers’ Web behaviors than bounce and click-thru rates – helping digital marketers identify the type of relevant cross-sell offers that will motive customers to open their wallets.
Businesses built around subscriptions or renewable contracts are other good candidates for applying predictive analytics – particularly for retention initiatives. While acquiring new customers is always at the forefront of marketing initiatives, we often forget that selling to existing customers costs a lot less and generates higher profits. Predictive analytics help digital marketers prioritize investments in sets of customers most likely to buy in the future.
The bottom line: predictive analytics is often an area that excites digital marketers the most, because of its enablement of the ultimate digital dream. But at the same time, it scares a lot of digital marketers because it conjures of visions of significant time and money. And while predictive analytics is not for the weak-of-heart, it is becoming more available, especially as automation is being applied to the creation of models (for example, from KXEN.
At the heart of any predictive analytics program success – lies the level of integration into an organization’s CRM systems, as well as its richness of data. Combining historical data and information from external sources for example, offers an even better chance of success. So if you’re ready to investigate how predictive models can help you realize the ultimate digital dream, consult Gartner research on the topic and start placing some inquires. For example:
Use Predictive Analyics to Retain More Customers
You Don’t Need a Big Budget to Success with Predictive Analytics
Advanced Analytics Enables Real Time Business Optimization
Category: Digital Marketing Tags:
by Richard Fouts | June 19, 2013 | 1 Comment
More proof why customers rule in the digital age.
If you’ve ever participated in consulting engagements with management consulting firms (either as a seller or buyer) you know that transformation initiatives are pretty much led by what is good for the business. I remember during my tenure at Hewlett Packard when we hired McKinsey to reassess our go-to-market model. The decisions stemmed from why selling through partners, OEMs and alliances made good business sense – for HP, not necessarily the customer. Of course, we eventually backed the new model into a “voice of the customer” story, but the going in position was how to reduce sales costs and increase coverage. Our mantra was, “If it’s good for us, it’s good for the customer.”
That’s all changed. Perhaps it’s the unstoppable trend that customers rule. Or maybe it’s even coming from the influence of digital marketing agencies that historically begin any engagement with customer experience (for example, agencies such as R/GA, Razorfish and SapientNitro are clearly taking share from management consultants in the digital transformation consulting space).
But what’s also really notable: digital transformation consulting engagements are being driven more by marketing executives (who are usually more sympathetic to customers than COOs or CFOs). Many marketing executives are also eager to continue their migration from chief marcom offiicer to chief marketing strategist, sensing digital transformation as a good “feather in the cap” initiative to lead.
Whatever it is, driving digital transformation engagements with a vision for customer experience is becoming an accepted consulting technique, even amongst management consulting firms.
For example, when Thomson Corporation engaged The Parthenon Group to reassess its go-to-market decisions, it took a page from the Proctor & Gamble playbook, known for following consumers around stores and observing them in their kitchens. Thomson decided to try the idea out, realizing they didn’t really know as much about their end users as they should.
The exercise later become known as “three minutes” which combines observation with detailed interviews to learn what end users are doing three minutes before they use a product and three minutes after. The approach was so illuminating (the simplest ideas often are) that it evolved into a front-end customer framework in its third, possibly fourth generation. A majority of Thomson’s 32,000 plus employees have been educated in its principles. In fact, Thomson now estimates that 70% of the products and services in its businesses been developed through front end, customer-experience-driven approaches.
The sources of revenue has changed dramatically of course – 80% of the company’s revenue comes from digital (revenue that is also unusually repeatable, predictable, and profitable). A dollar of revenue now yields twice the operating profit it did ten years ago. It’s a good reminder that at the end of the day, customers are paying the bills.
Category: Digital Marketing Strategic Planning Tags:
by Richard Fouts | June 11, 2013 | Submit a Comment
When “awareness” is citied as the justification for a marketing investment, the room can get chilly. This is especially true in sales-driven, b2b circles. Why the chill? In the classic purchasing cycle (awareness, evaluation, buy, bond) awareness sits on the opposite side of what your CEO wants: revenue from new and existing customers – preferably now, not later.
Moreover, when asked, “How much revenue will come from your awareness campaign?” you struggle for an answer. That’s because it’s the wrong question. If this is a familar scenario, read on.
A survey conducted by Kellogg School’s Mark Jeffrey, reveals that leading CMOs spend twice as much on marketing (10% revenue) as laggards (who spend 4-5%). Leaders also consistently outspend laggards on awareness marketing.
But what is really interesting are the next two data points from Jeffrey’s study:
1 – Marketers - across the board – spend 50% marketing budgets on demand generation activities (true for both consumer and b2b).
2 – Laggards outspend leaders on demand generation yet underperform when it comes to growth, share and profitability. B2B demand generation campaigns, especially those preceded by no awareness marketing, are also well known for getting pitiful response rates (often in the 2-5% range).
Two things we can conclude:
> Laggards spend more on demand generation, but get less return, in the belief that they can magically omit the awareness phase of the buy cycle. However, it looks like their magic isn’t working.
> People won’t buy your product if they have no awareness of it; (ask your CEO the probability of buying a $100,000 automobile he/she knows nothing about). Products that have high top-of-mind recall outperform those that don’t. Recall of course, can’t happen without awareness marketing.
Two weeks after JC Penney lauched its now-famous awareness ad, “We Heard You, Now We’d Like to See You,” door swings (the predecessor to retail purchases) increased 30%. Conversation on the social web increased 414%. Both are good news: You’ve got to get people talking about you if they’re going to come see you – and make a purchase. So while the JC Penney ad hasn’t been linked quite yet to revenue, it’s driven people into its stores. Revenue will likely follow.
The big challenge of course: measuring awareness. You can hire Interbrand (or any number of agencies) to conduct an expensive brand awareness survey or you can track some of the typical metrics used to assess awareness.
- Is the number of attendees at your events and webinars increasing? If so, you’ve increased awareness.
- Are you generating more traffic to the web site? If not, awareness could be stagnant or declining (check out the awareness campaigns of your primary competitor).
- Are you getting more inbound inquires? Or are inbound inquires constant, in which case awareness is stagnant or you’re losing interest to a competitor that is rustling up awareness.
- Are visitors downloading your white paper at a constant or increasing rate? If the latter, you’ve likely increased awareness. Same with free trial downloads.
- Are web site visitors coming from blogs and discussion boards where you’re actively joining conversations? Is so, your awareness activities are working.
Another metric of course is the “test drive” which can be free product usage for a limited time (which is how Salesforce gained so much initial traction), or free downloads. Auto dealers for example know of (and track) the relationship between test drives and future sales. All marketers can follow this practice and use awareness campaigns to drive prospects to test drives or trials (which is the next logical phase of the buy cycle, aka “Evaluation”).
The biggest challenge in measuring retun on campaigns specifically designed for awareness is the time delay between their launch – and their actual impact on revenue. It could be weeks, months or even years (Audi has started taking share from BMW, but it happened years after launching its multiple awareness campaigns).
Hence, financial metrics do not work particularly well when justifying awareness campaigns. So my final word of advice: use metrics cited above to measure indicators of future sales. Applying financial metrics like ROI, o awareness investments, will only get you in trouble.
Reference: Mark Jeffery (Kellogg School of Management) surveyed 254 mraketing executives with average marketing budgets of $222 million. You can see the results of his entire study in Data-Driven Marketing, John Wiley & Sons, 2010.
Category: Brand awareness Digital Marketing Marketing Strategy Tags:
by Richard Fouts | June 9, 2013 | Submit a Comment
John and Marsha are quarreling:
John: You embarrassed me in front of the kids ….
John: At my parent’s holiday party.
Marsha: You mean that disaster 5 years ago? Why am I hearing this now?
Marsha is not alone in her sentiment. “Feedback in a timely fashion” is something we demand from personal relationships, customer service people, sales people and now, from educators. “Students are telling us they learn much better with instant feedback,” says Anant Agarwal, president of EdX, a non profit online education enterprise launched by Harvard and MIT.
The EdX platform grades exams, including those that are essay oriented and those that require short written answers – in real time. Those torturous days, even weeks students experience waiting for a grade are collapsed into seconds. Getting your grade instantly is great, but there’s more. Students can re-take the test based on the software’s feedback, enabling students to take write essays over and over to improve the quality of their responses.
Imagine what this means for law students taking the bar? Or physicians seeking board certifications? That’s a stretch right now, but as this software matures, it’s not a far off scenario. In its current version, the system trains itself – using a human educator’s results of an initial 100 essays or questions. The system grades exams based on the system created by the educator, whether a letter grade or numeric rank. It also tells students whether an answer was on topic or not.
Now if they could just figure out real time learning. Wire me up and an hour later, I’ve mastered Calculus 101.
Category: Uncategorized Tags: