The State and Drivers of Data Marketing

What matters most is the optimization of the customer experience, relevance and (perceived) customer value as a driver of business value. Data-driven marketing certainly is not (just) about advertising and programmatic ad buying as some believe. Nor is it just about campaigns. On the contrary: if done well, data-driven marketing is part of digital marketing transformations whereby connecting around the customer across the customer life cycle is key.

Very succinct vision of what data-driven marketing is, it's all about the customer experience.  The advent of "big data" was nothing more than gathering extra data about the customers.  Gathering data is only the first step of the process, albeit a time-consuming one.  The good news is after the hard work of gathering the data has been completed, the harder part starts.  Once you have data, making sense of the data and creating actionable outcomes to enhance the customer experience becomes the goal.  This is very hard work.  It takes plenty of analysis and insight to reach this goal.  But the companies who will do this the best will be the ones that succeed in the digital age.

Among the key takeaways of the data-driven marketing report by the GlobalDMA:

• 77% of marketers are confident in the data-driven approach and 74% expect to increase data marketing budgets this year.

• Data efforts by far focus on offers, messages and content (marketing) first (69% of respondents). Second ranks a data-driven strategy or data-driven product development. Customer experience optimization unfortunately only ranks third with 49% of respondents.

• Among the key drivers of increased data marketing: first of all a need to be more customer-centric (reported by 53% of respondents). Maximizing efficiency and return ranks second followed by gaining more knowledge of customers and prospects.

I believe the first step in the process is understanding where the puck is going to be and skate in that direction.  Marketers are understanding this data revolution is coming and they are saying the right things in surveys.  The real question will be how to get there.  It's easy to identify problems, it's hard to implement solutions.  The marketers who will show they are adept at change will thrive in this new paradigm.  

Customer analytics is something I have focused my entire career.  In the casino industry we have had the optimal opt-in mechanism for many years and have collected amazing amounts of data about our customers behavior.  We have used this to create targeted marketing campaigns to our customers, so I believe in the direction the entire industry is taking.  Always start with the customer.  It will lead to creating better experiences and more profitable results.

 

The Missing Connection Between Big Data and Great Insights for Data-Driven Marketers

Data-driven marketers today are wondering how they can gain insight from big data. The answer? The ability to change is the connection between big data and insight. Data-driven marketers today know that their roles are changing: 68% of marketers think that marketing has seen more changes in the last two years than it has in the past 50 years, according to a recent survey.  The changes are due to a renewed focus on customer experience within their jobs, and the need to use big data to improve that experience.

Customer Experience is the buzzword over the last 2 years, combine this with the other buzzword of "big data" and you can understand why 68% of marketers think marketing has changed so drastically the last couple of years.  I think what is causing all this change is how technology has shifted the paradigm of marketing.  

For many years marketers were able to call on plays from the same playbook and be very successful.  The technology was never really able to advance the playbook and very few companies were pushing the boundaries.  Today, marketing technology companies are driving the sea change, creating platforms which make creating authentic customer experiences possible on a large scale.  

Companies are having to tear up their playbook and turn their strategy on its head.  This goes well beyond just the marketing playbook.  Companies are having to start culture change throughout the organization as the customer experience goes well beyond just the marketing department.  As customers interact with all parts of organizations, there is little care of operational silos within companies.  

The biggest sea change is what Adobe refers to "marketing beyond marketing".  No longer can marketing leaders be focused on the message and bring in customers, only to wipe their hands after the customer starts engaging with the brand.  Marketers are learning they are the leaders of the customer experience renaissance.  Marketing is having to drive the experience of the customer throughout entire organizations, which is not a skill-set a traditional marketer has.  This change will be driving "big data" initiatives as marketers are learning to understand their customers in new and interesting ways.  

Why CEOs Say Yes to Marketing Automation

Ten short years ago, it was rare for a company to have a marketing automation platform in place. Since then, it’s become ever more clear that acquiring marketing automation (and applying the expertise to make it hum) is a huge competitive differentiator. SiriusDecisions research indicates that 80% of the organizations with the highest-performing demand waterfalls (based on the number of won deals per 1,000 inquiries) have implemented marketing automation platforms. This tallies with other research; the 2015 report “Rethinking the Role of Marketing” from Gleanster and Act-On found that Top Performers were 20% more likely than the average organization to use marketing automation technology..

I think it is still rare for most organizations to have a marketing automation platform, but what is even more rare are companies who are taking advantage of their platform.  The promise of marketing automation is very enticing as this article articulates.  The benefits of a well-run marketing automation program is an extreme competitive advantage.

1. Marketing Automation Lets You Put the Customer in the Center of Your World.

List management. Marketing automation lets makes it easier to segment your lists by field values (explicit data such as title, department, industry, company size) and by implicit, inferred factors (often actions) such as web pages visited, eBooks downloaded, emails clicked on. It also lets you sync chosen data back and forth with a CRM system.

Well beyond the realm of salespeople, marketing automation lets you manage your customer base on a level of personalization that is not possible otherwise.  Some say these platforms make the relationships with customers less personal, but that is a fallacy.  With the amount of personalization and targeting capable with these platforms, the customer gets a more personalized experience with marketing automation.  

The amount of time manual processes take to manage the customer, it is impossible for these processes to really give the best experience to the customer.  There is just not enough time in the day.  However, a marketing automation platform can create customized communications based on all of the data described above, including behavioral information, geo aware messaging and preferences of communication channels.

Campaign management. Automated programs can save time (which is money, yes) and take a little human error out of your programs. You can set them up to replicate successful lead nurturing or onboarding programs, for example, and they will run exactly as programmed, no matter who misses work on Tuesday. You can add prospects as they enter your world (perhaps through a form) and exit them (perhaps to another program, or to sales) as you learn more about them, or as they become increasingly qualified. You can set up trigger emails (thank-yous, congratulations, expiring trials) and landing pages that make offers or fulfill requests, showing how responsive you are.

Campaign management is a difficult process if you have different programs pulling lists, then fulfilling communications and measuring results.  The amount of time saved by having a platform where everything is integrated and can trigger off the behavior of the customer is very powerful.

6. Marketing Automation Takes Care of the Established Customer

The platform gives you a structure you can scale in your retention strategy. Start with using a nurturing educational strategy to support onboarding. Move on to keeping your customers in the loop, educating them about new features, showing them new plays with old features, and keeping them abreast of changes in the industry that affect them. Take the same techniques you use to notice when a lead is warming up and apply them to noticing when a customer is looking at an upsell … or needs attention to prevent churn.

Retention is the most important part of the database.  The greater the number of sales coming from your established customer base allows for the greatest growth in your business.  Marketing automation at its heart is best for the established customers.  The platform is designed to drive more business from this segment.  Since the majority of most companies revenue comes from loyal customers, having the ability to grow this groups sales is essential to a longterm stable business model.  The marketing automation platform should be at the center of this model.

7. Marketing Automation Spurs Revenue and Growth

These benefits are all pieces of a puzzle that every company using marketing automation puts together in its own unique way. The common denominator is that most companies that apply marketing automation – whether they use every feature or just the basics – will see faster growth and post more top-line revenue.

Well who doesn't want that?

Becoming Customer Centric is a Journey not a Destination

A very insightful article from Timothy Smith of Tahzoo.  Becoming a customer centric organization is not achieved through initiatives, it is achieved through a culture change.  

From my perspective, too many of the current efforts in financial services are internally focused, and are being solely thought about as technology projects. As I pointed out in my webinar, technology is only one part of the solution. Companies need to be thinking about transforming their business and marketing approaches in addition to their technology infrastructure. If companies don’t invest in these other transformations, they may not ever deliver on their customer centricity goals. Time and money needs to be spent on creating organizational alignment, understanding the customer journey, and deploying marketing strategies that reward, recognize and respect customers.

Companies tend to look at their technology in terms of deficiencies instead of what a technology will allow.  Technology should never be purchased until there is a specific business need the technology will solve.  If your company isn't ready to evolve beyond their current technology platform, a better tool will not help your company evolve.  To become a customer centric organization, the culture needs to evolve first and then technology can support the organization as the needs arise.  It should never be the other way around.  Customer centricity does not happen through more data about a customer, it happens when all decisions are focused on the customer.

Southwest Airlines Making an Impact in Marketing Automation

I love Southwest Airlines.  They have been the ,most profitable airlines by creating a business model which serves both their customers and their shareholders.  Southwest has managed to delight their customers and they are one of the few airlines that actually turn a profit, plus they haven't gone to the nickel and dime your customer model that has been popular in the industry.

The one area they have been weak in is database marketing/marketing automation.  The emails my wife and I get from them are very generic.  These emails have never been tailored.  This is the same in direct.  I have a Southwest Visa card and I still get an application direct mail to this day.  They also send some of these applications multiple times per week.  I tend to forgive because I am not a fan of the nickel and dime approach most other airlines employ.

Out of the blue I got an email that was actually targeted, well I hope it was targeted and not everyone received.  They sent me a tier upgrade promotion if I flew 3 roundtrips in a 2 month period.  To give a little background, I was flying much more a year and a half ago and I was an A-list, but recently I haven't needed to fly as much and I lost that status.  What I hope they are doing is looking to see that I have the propensity to become an A-List and they are betting that I will take them up on this offer. 

I happen to be taking a couple of flights in that time period, but I was going to be one roundtrip short.  Now this is where the psychology of tier benefits are interesting.  In my experience, a company doesn't necessarily get a customer to do something drastically different in their behavior to get to the next tier level.  This is true in my case.  If I hadn't been taking those 2 other trips, I would not have flown 3 roundtrips to make it to A the rest of the year.  But since I was taking those trips and I was going to be close, I decided to take 1 more trip up north and see my stepdaughters.  I would not of otherwise taken this trip.  So the promotion made them some incremental revenue and has kept my loyalty with Southwest.

This could be a less targeted approach and I just happen to think it is because of my propensity.  They send me an email last week reminding me of the promotion ending, however they did not reference I was 1 roundtrip away, so they aren't exactly where they need to be yet.  But, if Southwest can put together a strong direct program with their superior business model, then other airlines will have even more to worry about.  Here is to hoping they are moving in that direction.

Agile is the Key to Digital Marketing Success

Another key topic coming out of the Adobe Summit 2015 is this idea of structuring the organization properly.  Now this is an age old problem and doesn't necessarily just revolve around digital marketing, many organizations fight the structure issue.  I had a mentor that preached to be a successful organization its 80% structure, 10% people and 10% process.  Now that made the people really mad when he said this, because people always want it to be about them.  In reality, it is about them, what he was trying to say is without the proper structure, it doesn't matter how good your people and processes are, they can't thrive if they are always being stifled.

So a day in the life of a digital marketer is too reliant on other individuals for them to be a success, they are stifled by the system.  Now they may produce content and delivering good results, but if the structure of the organization is not optimal, it is preventing these outstanding individuals from being great.  Once the marketer has to jump through so many hoops to achieve the end goal, they are already making compromises.  It may be they are making compromises on the content because they know the content creators will give them push back, or have too long of a timeline, so the request becomes watered down.  The landing page may need a little extra something to up conversion, however that may need a new set of requirements for the web team to build, so to keep things moving the marketer doesn't add that piece.

To be great a digital marketing organization needs to be agile.  Things are changing constantly and the digital marketer needs to move at the same pace, if not faster, than the consumer.  Today the digital marketer is 10 steps behind the pace of the consumer.  The organization tends to be divided into marketer, technical and creative.  These all need to live under the same umbrella.  The second a marketer is waiting on IT or a creative agency, the marketer is not fast enough.

The marketer needs to have those departments set them up for success.  So IT needs to set up the hardware and get the marketer the tools to be self reliant.  IT should not try to control the content being moved and updates that need to be made to websites, landing pages or apps.  Creative agencies need to set up multiple templates and ensure there is enough creative content to fill those templates, but they should not be a roadblock to any content that is released.  If a new email and landing page needs to be created for a real-time need, the agency or brand should not be involved in slowing this process down, the digital marketer should have all the tools and messaging already at their disposal.

If the organization is set up so the digital marketer can see the opportunity (data), glean insight from the data (analysts), create an audience (technical), create a new email marketing campaign (database marketer), create a landing page for the email (creative and technical), create a cross channel ad campaign for that audience (media and creative) and then measure the results (data and analysis), then the organization is set up correctly.  The digital marketer should be enabled to go through this entire process without needing IT tickets, agency or brand approvals or pro-forms to be created and approved from the executive team.  Allow your digital marketing team the freedom to be successful.  Measure their success, give them a budget and guidelines, but empower the digital marketer to drive revenue and jump on opportunities.  The results will speak for themselves.  

How to Keep Your Customers by Thinking Ahead of Them

...more important to deepen your connection to your existing customers than to spend a lot of time and money trying to figure out why certain customers left.

That’s not to say that you shouldn’t care about losing customers. Customer attrition and churn can kill your bottom line. But once customers are gone, they’re gone. The best way to hang on to them is with a process I call “closing the backdoor.”

Great points in this article.  So many people focus on bringing a customer back, instead of focusing on keeping the customers you have.  The most profits to be made is by increasing the frequency of your current customers.  By striving to satisfy and get out in front of your current customers needs, you will have more current customers (because new customers will outnumber your churned) and they will be more frequent purchasers.

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There are many lifecycle charts, this one is more transactional with each purchase.  For instance, in selling hotel rooms we have a much better shot at getting a guest to return if they are ready to return.  Any communication preceding that will usually be met with indifference.  It won't hurt the cause, but you likely won't get a booking either.  If you can send, i know this is going to be cliche, the right offer at the right time, you will increase frequency and redemption percentages.  ​