Richard Fouts
Research Vice President
2 years at Gartner
23 years IT industry
Richard Fouts analyzes best practices in marketing management for technology and service providers, including insight and advice in brand management, market and competitive position, messaging, sales, and go-to-market strategies. Read Full Bio
by Richard Fouts | February 13, 2011 | Submit a Comment
How much do you typically spend to generate a few million impressions, connections, email signups or leads? What do you spend to generate a thousand click-thrus? Well – put your check book away, because the CEO of Overdrive interactive, a digital marketing company, has a cost avoidance technique.
Many of you already know about it (hint: it’s called social media) but now you have a way to quickly, effectively and convincingly measure it. It’s called Media Equivalent Value, or “the monetary equivalent of the impressions generated through social media, that would have traditionally been acquired through paid media.”
Case in point: Back in 2008, Telus marketing executive Jeff (the Canadian telecom provider ) told me he had garnered two million impressions with his social media campaign. Okay, that’ s nice. Wait, he says, there’s more.
You see, Jeff had recently launched the firm’s new Blackberry. And like any marketer he did a full scale media outreach with his PR firm (which of course charged him dearly) – and he bought some advertising. All expensive of course, but you gotta do it. But he also included several influential blogs in his space in his media outreach. He did these largely on his own. Skip to the end of the story – the impressions, click thrus, email sign ups, blogposts, tweets, re-tweets number about two million. Historically Telus spends about a dollar per impression when you average it out over their paid media campaigns. So they generated two million bucks worth of paid media …. for free.
More validation of Media Equivalent Value arrived when Proctor and Gamble yanked millions of dollars of daytime TV advertising off the air .. in favor of social networks (where it claims to get far greater ROI).
We’ve all been doing this but haven’t had a concise label for it. Now we do. Media Equivalent Value. What do you think?
Category: Brand awareness Marketing communications Public relations Tags:
by Richard Fouts | December 28, 2010 | 5 Comments
Come on admit it, you’ve said this to yourself a million times. But there is a new trend looming that just might offer a cure to ‘death by PowerPoint’. It’s from Japan and it’s called PechaKucha, which literally means ‘chit chat’.
The idea behind this technique is simple. You show 20 images for 20 seconds each. If my math serves me, that’s six minutes and 40 seconds. And – you set it to AutoRun. Sounds easy enough, but this takes courage. Be sure you dry run it a few times before you try it. Let me know what you think. And consider this – if you’re in a hot competition for a large deal (or any deal) this format has a much higher chance of being remembered that your competitor’s “death by PowerPoint.”
PechaKucha pays homage to Steve Jobs masterful talks, where he uses images versus text; stories versus bullets – and tales of how people use technology to improve their lives and their businesses. Steve’s presentations (typically 10 to 12 slides) aren’t designed to present information as much as they are designed to inspire.
In these days of social media there’s more opportunity to use these types of techniques to tell your story. But – there’s also more noise than ever as millions of people tweet, FB, blog and change their LinkedIn status updates. Noise is everywhere – and if you’re using the same old ‘death by PowerPoint’ techniques you are forcing yourself into the abundant noise.
So try something new in 2011. Drop the bullets, the features, the functions, the capabilities. Stop telling us how many employees you have, where you’re located, how many engineers you have, how many bells and whistles you’ve built into your products. Tell stories. Tell us how people use your solutions to solve really important business problems. Sure, we need to hear all those other things, but put them in an appendix.
And try PechaKucha.
http://www.speaker.org/video/pechakucha.html
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by Richard Fouts | August 18, 2010 | 3 Comments
Eloqua is teasing us to attend their next webinar with the email subject line, Why the CMO Should Carry a Quota. Great idea right? After all, marketing executives are rapidly adopting the mantra, “We drive growth.”
While it might sound new, there are plenty of CMOs that carry quotas, and when I talk to them they admit it drives opportunistic behavior (you know, the kind of organization that does anything for a buck?). And it can drive growth, in the short term, but at the expense of investments that drive long term growth – and stability.
What CMOs can learn from CIOs.
This question reminds me of the piles of research that Gartner and others have done on the New CIO Leader, the one that goes beyond just making the trains run on time and takes a seat at the strategic table. The CIOs that focused on the trains were not invited to the strategic table (why should they be?) and were eventually told, “Thanks for your contribution. You’ve made it easy to outsource IT. Thanks, again. Your gold watch is waiting at the door. ”
The CMO that is driven only by revenue falls into a similar trap. They end up generating leads and supporting sales, which is obviously a good thing to do. But the organization realizes all they really need is a good Sales VP and an adequate marcomm manager. In fact, if you read the Eloqua webinar description, it essentially turns the CMO into a pipeline manager. Don’t we already have one of those?
In Eloqua’s defense, I’m sure they aren’t this single minded, so I’ll tune into their webinar and see for myself.
Category: Personal selling Tags:
by Richard Fouts | August 11, 2010 | 6 Comments
This story truly represents the perfect storm – of the bad experience – where the customer, the employee and the provider — all collided. In this case, both employee and customer were having a bad day – on the same day. The timing was perfect.
Both came face-to-face with their own break points – the end of their respective ropes; they both encountered straws that broke the backs of their respective camels. Whatever cliché you call it, both customer and customer-service-representative hit that “postal” moment at the same time, against the backdrop of the provider (in this case JetBlue, who engineered the perfect environment for the perfect storm to occur in the first place).
So what can we as marketers learn from the Steve Slater story? “It’s about the experience, stupid.” Not just the customer experience – but the employee experience. Something providers overlook.
Let’s start with the customer. Airlines have made the travel experience so appalling that it’s no wonder passengers “hit the wall.” I’m not defending the bad passenger mind you, just explaining it. It happens with any business – a customer hits the wall because the provider sees everything from its own point of view. It’s about their rules, their process and what they need to do to transfer money from our pocket to theirs. Or they turn customer requests down because “the computer won’t let me do that.”
Customer service people hit the wall because customers just don’t get it. They keep telling customers their “inside-out” story and get hugely frustrated when customers don’t seem to hear it. So they say, “take this job and shove it.” And they say things like, “customers are idiots” under their breath – while the customer also calls them the same names.
But there’s a third party to all of this – the provider who is responsible for engineering the environment for both experience types, good or bad, to occur. In their defense, JetBlue competes on the experience, and they did a good job of it in their early days. But of course, Virgin Air is now eating their lunch, by going one better. So one wonders if JetBlue has lost its experience mojo.
What Virgin gets – is that happy employees create happy customers. Its employees are as evangelical about working at Virgin Air as their customers are about flying Virgin Air.
One of my clients, Informatica gets this too. They have extremely happy customers, as evidenced by their renewal rate (because a customer isn’t really a customer until they come back). And Informatica customers don’t just agree to be customer references, they practically demand it. Informatica employees are also enormously happy, as evidenced by their low turnover and internal surveys. They’ve figured out you can’t have one without the other. Happy employees create happy customers. Unhappy employees? Well .. you get the picture…
I’m not saying JetBlue’s employee/customer experiences are no longer in harmony, rather using this story to educate marketers about the pending perfect storm. The dollars you dump into customer experience will be wasted if you aren’t looking with equal fervor at your employee experience as well. It’s not about putting a bunch of service features together, but understanding what customers go through – before and after they engage with you. It’s a much bigger picture than your own particular service environment. There are many things we all do to improve our service, but if we do it independently of the larger experience – we miss the nuances. As any experience designer will tell you, we have to craft SCENARIOS, not just service features.
But here’s the lesson of Steve Slater. In our zeal to understand the customer, we might be overlooking the experience of the employee that delivers the experience. It’s time to put the two together. We need to analyze the uber-experience.
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by Richard Fouts | May 27, 2010 | 1 Comment
Why you ask? Well, for starters CA is changing its name to CA Technologies. For those of you that were under a rock last decade, CA’s chairman was given a 12 year prison sentence after giving the green light to overstate the firm’s revenue by $500 million (to pump up the stock price).
The firm survived the turmoil – and is ready to put the past behind and move on. No, wait…. Its new tag line, Believe Again (the operative word being “again”) conjures up images of the past. By saying we should believe ‘again’ CA urges us to re-consider investing in them – back ‘before’ all the problems started. I believe it’s the wrong tag line at the wrong time.
But there’s another issue. Brands should be timeless. Otherwise, you end up spending fortunes on re-identification campaigns. For example, no matter where Nike goes with its product line, “Just do it” as an athletic battle cry will never be irrelevant. No matter which direction Accenture heads it consulting practice, “business performance delivered” will always be relevant. In the 1970s the Gartner brand was “helping you make better, more informed technology decisions.” Today, the IT industry doesn’t even remotely resemble its former self. But our brand is still relevant.
With CA however, Believe Again will run out of steam at some point. In fact, CA wants it to become irrelevant as soon as possible. They want us to just Believe. Of course, measuring market belief won’t be easy. When CA executives believe “belief in them” has hit an acceptable level, they’ll be back to the drawing board, with a new brand campaign, “thanks for believing in us again, now stay with us as we <<insert new tag line.>> And the coffers at their agency of record will ring all the way to the bank.
Stay tuned for Gartner research that will support your brand initiatives. Analyst and Gartner Fellow, Jennifer Beck, will head it up. She has created a strong going-in position, that good branding results in a promise the company can deliver against for all time. Stay tuned for some good insight.
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by Richard Fouts | April 19, 2010 | 8 Comments
Automating the management of customer references is an emerging software category whose time has come. Companies like Boulder Logic, Point of Reference, References-Online and Metia all see how complex it can be to not only recruit customers to act as references, but to manage them as well. When customers act as references, they put their reputations on the line. And when customers migrate to evangelist territory, they are worth 10 great sales people.
Case in point: now that Metia has supercharged Microsoft’s customer reference solution, the sales process moves faster, site traffic has increased and more prospects and customers download Microsoft case studies. Boulder Logic has created similar results for NetApp.
While I commend these providers, I urge them to think bigger. Marketers are leaving a lot of ROI on the table when it comes to customer reference programs, by limiting their applications mostly to sales opportunities. But, investments in the comprehensive management of customer references drives impact (and ROI) far beyond the sales organization. Customer success stories help:
- Brand managers. When brand managers point to real customers who validate the firm’s value proposition, brand equity naturally increases. As marketer Guy Kawasaki reminds us, “What others say about you is more important than what you say about you.” (Reference: Reality Check. The Guide to Outsmarting, Outmanaging and Outmarketing Your Competition).
- Investor and public relations. Vendors that support brand promise with viable references reduce risk for investors. Savvy CEOs sprinkle reference stories throughout things like earnings calls, major account pitches, and conversations with institutional investors to show that the business strategy is working. PR and corporate communications people also use reference stories to validate the firm’s ability to execute its vision.
- Industry analysts and other members of the media rarely settle for theory; they want to know where you’ve succeeded in practice. Few publications mention a product from a provider without an associated customer success story.
- Finance managers. By investing in a well-defined, structured customer reference program, providers note improvement in customer profitability. Why? One marketer we talked to explains it this way: “Customers who act as references are also our most loyal and most profitable. Our CFO loves this program.”
Even HR managers want to get in on the game. Recruiters love to name drop. They love to use reference stories to convince the best talent to choose them over competitors. After all, who doesn’t want to work for a company with happy customers? If you’ve ever worked for a company full of unhappy customers, you know what Dante was talking about.
As in everything marketing, it starts with customers. When customers are happy, employees are happy, managers and executives from PR, IR, HR and all those “relations” boxes on your org chart are happy. Oh yeah, and Wall Street is happy too.
Okay, I’m not trying to develop a screenplay for Disney, but you get the picture. If more people get in on the love, the results can skyrocket. So vendors, if you agree with my point-of-view, think about updating your marketing copy.
Category: Brand awareness Marketing communications Personal selling Public relations Tags:
by Richard Fouts | April 2, 2010 | 2 Comments
The Boss would take issue with marketing and communications people that include “exceed customer expectations” in their mission statements (or those lists of core values you see hanging in company cafeterias). Why?
“Because I want them to come to my next concert,” he replied when a pesky reporter called him “ungenerous and almost stingy when it comes to encores.” She was commenting on Bruce’s propensity to perform a single encore after a great concert (the only kind he gives). While the boss admits he’s been known to cave to a second one, it’s the exception. Even when the fans are tearing the house down, he resists, packs up his guitar, heads for the back door – and leaves them wanting more.
We can all take a cue from Springsteen. Consulting firms should especially listen up. Marketing copy from IT consultants includes the “exceed expectations thing” more than anyone. But as Peter Block notes in his book Flawless Consulting, you might have to exceed the higher bar you’ve just set each time you deliver – or you run the risk of under-delivering …. when in fact all you did was fulfill your commitment. Before you know it, your costs have run amuk (and you were just trying to be a nice guy).
It’s like the consulting firm that discounts their initial engagement …. to get in the door. When they propose their next phase pricing, which they refer to as “fair market value” …the client is very unhappy. You’ve set the bar with your discounting pricing. Now you shift to what’s fair ….and it comes off as price gouging or bait-and-switch.
So before you get sucked into that seemingly harmless, almost flippant remark “we exceed our customers’ expectations” make sure you’re not setting yourself up. When you give it away for nothing, you’ve set the expectation that you’ll do it again ….and again and again.
Thanks to colleague Matt Goldman for inspiring this post.
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by Richard Fouts | January 29, 2010 | 6 Comments
There’s a whole movement around replacing marketing’s 4 P’s with the more modern 4 C’s. And if you check out Paul Duany’s blog, you’ll get a taste of the conversation and controversy.
By way of review, Dunay’s 4 C’s of B2B Marketing are:
Content – the creation of a steady stream of engaging content
Connection – connecting with the audience you wish to attract
Communication – communicating with them in an ongoing conversation
Conversion – and then converting them at the illusive moment of need
In my opinion, the argument for the new model has merit – especially when you realize the 4 P’s were created in a physical world, with limited physical distribution and promotional platforms. Today, these platforms have been completely blown up by digital networks that relieve these limitations, giving customers new ways to “participate” in the provider’s world, not just “receive” what provider produces in the ways it wants you to receive them.
But – it’s taking control of the Product P (or at least influencing it) that put marketers at the strategic table in the first place. If marketers aren’t careful, they will migrate to this new model, putting a different type of limitation on it — which uses the model as a zealous promotional vehicle.
No one wants to go back to the days of promoting whatever engineers throw over the wall. So my advice to marketers that love this new model: make sure you implement the Connection C the right way: as a channel that informs your product and service strategy – not just as your promotional mix and lead generation engine.
If you lose the Product P you’ll migrate yourself backwards to being a supercharged marcom manager. If you have any aspirations at all of becoming a CMO or sustaining your role as CMO, you’ll take this advice to heart.
Getting a seat at the table means you have a handle on valid market intelligence that informs you about what customers want. It’s your admission ticket to the strategic talks.
The whole idea of the 4 P’s was to assure marketing got a seat at the table, largely through the Product P. By listening to the market (yes, we listened to the market even before social media) marketers adopted a “sense and sell” model versus the older factory model, commonly called “build and sell” (hence, the cliché “build a better mousetrap and the world will beat a path to your door”).
I still look at marketing plans from senior marketing executives – that are promotional plans, not marketing plans. If you adopt the 4 C’s in your zeal to become communicator of the year, you’ll become communicator the century, but never a strategic marketer. You can prevent this by using the Connection C as your path to the type of customer and market intelligence that gives you credibility to sit at the strategy table.
In a virtual world, the old model indeed needs a facelift, especially since mass market production is evolving to the power of niche markets and micro markets. For more on this, check out Wired magazine’s cover story, The New Industrial Revolution: the factory, the investors, the workers – obsolete. In an age of DIY manufacturing, all you need is a garage and a great idea.
Category: Marketing Strategy Tags:
by Richard Fouts | January 7, 2010 | 7 Comments
One of our Account Executives, Amanda Duffy, asked me if SMS was the next voicemail. There’s no question voicemail has declined rapidly in recent years as we’ve shifted our messaging preferences to email, text messaging, and now Twitter, Facebook and LinkedIn.
Why the decline in voicemail? Simple … it is not an immediate response tool, meaning, unless you’re on the same network, you can’t do a quick response to the sender. Secondly, we have gotten very attached to our email windows, especially as tools like Outlook have become aggregators of the messages we receive from our various social networks.
Voicemail will come back around of course, with speech recognition. Users will undoubtedly be seduced by the ability to speak a message into their phone, and have it translated to text and deposited in the recipients mailbox. Stay tuned on that one.
For now, can SMS be a productive business communications tool? It already has. I have personally noticed many Analyst Relations managers are using SMS to keep in touch with me and to keep me informed.
What about best practices in using SMS for business communications? The usual rules apply. SMS is just a medium. But messages obviously need to be short, clear and have a clear “call to action.”
Things like:
– I have two ideas for how we can add more value to our relationship. Do you have 5 min to discuss?
– Could we talk for 5 min about how we can help with your new initiative?
– Can you call me at 2pm to review how we can help you boost sales? I could also talk at 3pm or 430.
– One of our analysts has some innovative ideas for how we can help you kick start your marketing plan. Call me in the morning to arrange a conversation.
Bottom line: any medium that is constrained by message size … requires a “teaser approach” to messaging. Think TWITTER. The tweets that drive the most traffic are usually preceded by the words, “How to …” and are less than 140 characters. For example, my tweet “How to manage a customer reference program” was retweeted three times in 20 minutes.
People are hungry for “how to get things done” and “how to do something” …. so use the word “how” in your SMS messages whenever you can.
But remember … sensationalized messages are indeed ineffective and considered offensive. If you sensationalize the message just to get a return call … that’s a major offense. Things like “Call me for tips on how to get rich in 10 days” tick people off. You know the drill on that one…..
And of course, an entire new discipline, “mobile marketing” has sprung up thanks to cell phone adoption. As the guys at clickatell.com remind us:
“Consumers all over the world have come to rely on their mobile phone as an essential communications tool. They personalize it, take it everywhere they go, and many cannot imagine living without it”.
Category: Personal selling Tags:
by Richard Fouts | January 5, 2010 | 5 Comments
The biggest challenge is convincing customers to be references. Customers naturally become concerned about the time required to be a reference (especially if you want them to be available for a telephone conversation with a prospect). Hence, there are two things you can do:
1. Tell customers you put a limit on the number of times you will use them as a reference, for example once per quarter. You can also rotate them out of the program after one year, or some other period of time. Refreshing your references is always a good idea because it keeps them current.
2. Tell customers you will instruct prospects to respect their time and only call if they have questions not answered in the written testimonial.
When you request customers to be a testimonial or case study that will be written up and published, there are a few things you can do to put boundaries on the customer’s time.
- Have a well structured interview, that the client can complete by email. Make this optional of course. At least 80% of your clients will answer your questionnaire over email. If you prefer a live interview, tell the customer it will take no more than 20 to 30 minutes. But, when you conduct the interview, make sure your questions are brief and easy to understand. Stick to your agreement – do NOT go over the time frame you commited to .. and never make it more than 30 minutes.
- Include your customer reference program as a natural step in your sales cycle. Too often, we look for references from our current list of customers, where we have no leverage. We are simply asking them for a favor. Hence, it’s more effective to address the customer becoming a reference during the sales cycle as part of your sales negotiations. Think of every prospect as a potential reference. Many providers get new customers agree to be a testimonial when they close the deal, in exchange for a discount, a free service or some other offer. This is a very effective tool for increasing the volume of references.
- Position the testimonial as a promotional tool for your customer. Testimonials and case studies, tend to be all about you. This is logical of course, because it’s a tool to demonstrate what a good provider you are; that you have satisfied customers. But you can also use the testimonial and case study to promote the good work your customer is doing. When you write the testimonial, include copy about the customer’s value proposition and their successes. When prospects see this, they often agree quickly to become a testimonial because it is essentially free promotion.
When sales people hand out the published case study or testimonial to prospects, they are increasing the customer’s brand awareness.
And, in many cases, sales representatives report that prospects become interested in doing business with their customers.
Ask your customers directly: What can we include in this testimonial or case study, to promote you? What is it about your value proposition that would like us to highlight?
Manage your customer reference program just as you manage your sales funnel.
Track your conversion rate. Sales people don’t expect every prospect to close, hence they build a list of prospects with a pipeline value that exceeds their quota. For example, if your conversion rate of prospects that become customers is 50% and your quota is USD $ 1 million, you always have at least USD $ 2 million in your pipeline. You can manage your reference program using the same technique. For example, if your goal is to develop 10 solid references, you know you should be working with at least 20 customers as reference candidates (assuming you have a 50% conversion rate).
Make sure your references represent a broad range of types. Too often, our customer references are similar. For example, they all fall into the same industry or they are of a similar size. Account managers are famous for not using a reference if it doesn’t mimic the exact issues of their prospect. Make sure your spreadsheet of potential references that you are tracking includes a broad range of customer types.
Manage your reference program as a two-way street. Always give something in return. Customers that agree to be references are your most valuable asset. Brand is about what others say about you, not what you say about you, so make sure you’re acknowledging their contribution. After a testimonial is published send your customer a gift. For example, I send Gartner clients a series of books from Gartner press.
Again, the best technique is to include your reference program in your sales cycle as a negotiation tool. This is effective since it costs the prospect nothing and gives them something in return.
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