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Segmentation 3.0 – disrupting marketing, media and management

Designing advertising, services, products or doing media planning requires us to understand customers and target markets. The more we understand about behavioral preferences, attitudes, lifestyles and multiple other variables, the better we can do our jobs. Combining all sources of data: research, analytics, buyer segments in real time bidding (RTB) targeting engines, qualitative research.. its such a wealth of data that it has become too big to manage. Right now we need to be able to simplify and turn such wealth of data in to understanding and actionable priorities. This is exactly what segmenting should be all about.

Segmentation 1.0 is about creating customer understanding inside organization. The segments are actually stand alone pictures and stories about customers. These segments can’t be connected to data, which means that they steer creativity but don’t offer KPI’s, real business management tools or monitor market share changes.

Segmentation 2.0 is about more data driven and actionable segmentation. Dynamic interest grouping with online targeting tools allows you to calculate probability of click or purchase and adjust your investment/segment accordingly. Same method applies to existing customer analytics, which offers steering such as next best offer, likelihood of negative churn or the level of monetary value of different segments. It’s already about making data actionable. However, these technology specific, not market level segments.

There are two cases of Segmentation 2.0 that are now leading the way to 3.0 available in Finland. Finland is interesting because of advanced population register allowing you to do interesting solutions easier than elsewhere. However, these learnings will soon become internationalised.

The story about Finnish church is quite eye opening. Since 2000 the Finnish national church membership level has dropped from 85% to 72%. The Church is in crisis.

Church churn

Church has been responsible for registering population since the beginning of organized society in Finland. Everyone who gets baptized start paying church tax as part of their national taxation. My personal church tax was more than 1000€ last year. Losing members means losses in church taxation and losing young people means losing their life time taxes calculated in billions.

Church needed tools to understand their members and ways of preventing churn. Actually the church needed to re-invent them selves. They needed segmentation. Jarmo Lipiäinen, head of Kotimaa’s sales and marketing recognized this challenge and took action. Member 360 was born. This segmentation divides people in to segments by their religious tendencies and multiple other lifestyle variables. This segment tag is attached to everyone in Finland, member or not.

Screenshot 2016-03-16 10.17.58

Picture: Main and sub-segments

Screenshot 2016-03-16 10.18.12

Picture: Example profile – Disconnected experience seekers

Making the segmentation applicable required tools. Jarmo Lipiäinen led the project and they created data visualization tools for parishes. You can now look at areas and understand what kind of segments are there and buy addresses to people from different segments. This allows church to speak to their members and prospects in language and perception they can agree with. Church is not just about religion, it’s a second layer of safety net for under privileged people and has multiple other roles in society . People don’t leave church only for religious reasons, they expect church to act for greater good and help people. Church stands for a lot more than God.

Since the Member 360 was introduced, now +100 parishes are using the tools and changing the way church works and is relevant to their members. Church is now rewriting their story, hiring service designers to design engagements and services for members. One experiment, internet priest with chat, was very popular among young people who were in distress but would never have reached out to church advice or someone to talk face to face. The role of church, the message and ways of being part of peoples’ lives is now changing fast. Church is learning member centricity.

Commercial 2.0 segmentation

Another initiative took place simultaneously on commercial side, Fonecta Buyer Classification. This toolkit looked at people’s lifestyles and buying preferences and was also connected to the entire population. On top of that, it is also connected to   media buying tools and TNS research data. I have personally implemented multiple cases with buyer classification in travel, restaurants, hotels, telco and retail. Buyer classification has 8 main segments and sub-segments.

  1. Budget-Concious young adults
  2. Bargain hunters preferring finnish purhases
  3. Parsimonious Pensioners
  4. Brand-Focused thrill seekers
  5. Ordinary citizens
  6. Service-seeking couples
  7. Family-focused quality seekers
  8. Solid and prosperous elite consumers

The segments can be attached to your own customer database which allows you to see how many people there are in each segment, how they behave, how valuable they are, what do they buy. You can use this understanding to reach out potential new customers out there based on insights from your own data. Buyer classification allows you to connect internal and external realities with same segments and also monitor market development in numbers: who’s winning and losing what kind of customers. Business is not just simple numbers – won and lost, its very much about value too. The whole point of segmenting is about understanding where to concentrate your resources and optimize your profitability. You have to make choices, segmenting allows you to do make better decisions for those that matter most. This kind of generic segmenting attached to media buying and external data is a whole new game for business KPI’s and corporate management. It’s a possibility to connect creativity, resource allocation and business goals together

Human 360 – Next generation – segmentation 3.0

The next level is currently entering the market. Same segments are now connected to online behaviour too. You can now do online media planning by segments and use same segments in real-time-bidding. That’s a minimum standard in this day and age, but there’s more.

Member 360 and Buyer Classification were single purpose segments that could be adapted to other purposes but weren’t optimized for them. The next generation is about connecting multiple segmentation tools together:

  • 1st You have your own core segmentation or generic segmentation that has been made for your business sector’s specific needs. This segmentation is used for business management and company wide KPI’s
  • 2nd You have supplementary contextual segments for further insights: eg. Food, travel, technology, sports, politics, religion, fashion, housing,… you name it

To say it simply, the new generation approaches individuals holistically. People have different kind of passions and interests, capabilities and life situations. These contexts can be translated as passions and orientation. You can now approach people based on their orientation and you can analyze what kind of passions and orientations your current and potential customers have. You can also calculate scores for each segment allowing you to evaluate which approaches to your customers have strongest likelyhood of meaningful impact. Creation of business scenarios and relevant communications has never been easier.

Screenshot 2016-03-16 10.22.30

Such insight can be used for creative planning, media planning, new service development, partner selection,.. well, designing the future of the company.

Segmentation 3.0 enable us to connect 4C’s together and create a corporate GPS for success:

Screenshot 2016-03-16 10.22.42

Sofar Google has given a price for words with Google Adwords. This kind of segmentation will give similar price variation for people, it becomes the unifying currency in media buying. Some people have a much higher profitability potential than others. The future of media profitability will be dependent of reaching those audiences and people, advertisers are willing to pay most for. We are truly entering a new era in data driven analytics, planning, marketing, creativity and management. This development will have major impact on general management, mediabuying practices and entire creative industry. This kind of methods and tools will allow us to work miracles in unseen scale.

Aller Refinery

This development will further enhance marketing’s strategic role in management and strategy. Data will enable us to manage end-to-end processes better than ever

Screenshot 2016-03-16 10.22.54

Author Toni Keskinen and Jarmo Lipiäinen have published “Journey with customer – from product centricity to symbiosis strategy” –book in Finnish 2013.

 

Bridging the Agency-Client Relationship

For whatever reason, there is – and has always been – a massive divide between clients and agencies. Creatives and brand managers don’t just sit on the opposite sides of the table in boardrooms, they sit miles apart in terms of expectations, ideologies and understanding of each other’s roles.

Brand managers are unable to harness and direct creative efforts just as creatives are unable to understand the many practicalities, restrictions and real-world risks that come with managing a brand. The solution is teamwork. The best results come when the lines between the agency and client are blurred; when an agency becomes as involved in brand management as a client becomes in brainstorming and ideation.

Brand managers should be as involved in the creative process just as creatives should involved in understanding the dynamics of budget allocation, marketing strategies, and target audiences.

Agencies should spend less time working in isolation and more time working alongside brand managers to understand the brand from its core instead of from a brief – that is of course, when time and resources allow that to happen.

Further reading:

 

7P’s interview – Ephlux Insights with Toni Keskinen (of Future CMO)

Here’s my interview with Mr Babar Khan Javed about the backround of my thinking that led to re-creation of Marketing’s 7P’s published in ADMAP November 2014

Further reading:

Author: Toni Keskinen, Change Catalyst & Executive as a Service
http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

Paradigm shifts in Marketing 2014

Marketing Paradigm ShiftI believe that in 2014 corporate management and board take action and set new requirements for marketing. This has already been the trend for some time, but I believe that in 2014 a tornado hits marketing function in large-scale. I wish you could give your opinion on these. Please, if you disagree or notice that I missed something, comment below. Here they are:

-From campaigns to systemic growth acceleration
-From advertising to operations
-From brand book to brand experience & corporate culture
-From pre-planned year to realtime
-From one way to collaborative & dialogue
-From corporate led to customer led
-From bought audiences to owned and earned channels
-From guessing to proof driven continuous analytics, data and automation
-From promise marketing to customer excellence
-From online to mobile +
-Personal Anological communications become premium experiences at the digital era of minimizing contact costs and diminishing traditional direct marketing
-From selling to servicing – From outbound- to inbound marketing
-From Solo unit to collaborative accelerator
-From second rate corporate practice to management imperative

Let’s take a look at them in more detail:

From campaigns to systemic growth acceleration & From pre-planned year to realtime
Owned, earned and partner mediums offer means to generate constant customer flow and optimize conversions for sales. On-going constant presence and dialogue increase company’s reach, impact and capacity to communicate brand and offering in the digital environment “for free” (Naturally this kind of work requires a lot of work and high quality, so nothing is completely free). The marketing automation technology and continuous personalized communications with customers enable such influence and effect that their role is currently outranking paid media. On the other hand paid media is becoming personalized too. When customer is searching for something and her digital profile gives a high scoring value for certain offering, it is time to bid higher in the digital eyeball exchange (RTB) and get your message thru. The window of opportunity in Customer journeys to purchase could vary from seconds to months and marketing must be present at the right time with a right message. The era of mass media dominated campaigns and corporate led campaign schedules is over. Mass media has an important role in marketing mix, but it’s dominance is over now and continuous communications have the lead in importance.

From advertising design to operations
Advertising has been a unique discipline in the market and creativity is the core of advertising impact. Advertising is corporate led and scheduled work that takes money to publish. In this day and age the first priority should be to concentrate on your customer interfaces and channel strategy. How well does your customer interface meet with customer’s needs and expectations? It is increasingly difficult to say where marketing stops and product starts, and this is a good thing. Marketing & services are integrating and customer interface communications can use advertising means like videos to help customers further. Creativity has is now more important than ever, but the use of creativity is now more targeted in certain context and encounters with customers instead of mass-media with reach.

From one way to collaborative & dialogue & From promise marketing to customer excellence
One way manifests and promising is dead. People don’t trust advertising anymore and the access to information is present anywhere, anytime. In the connected environment we are now living in the old approach to building a brand with advertising doesn’t apply anymore. Brands are not built they are experienced and shared. The transparency revolution that empowered customers, forces companies to actually do better, not to just look better. The measurement of customer value has been a monetary concept for a very long time. Because there has not been technologies or means to measure anything else, that has been a valid approach. Today, customers have new currencies that can also be measured too. Customers can endorse a brand they like, or they can give very visible and durable critical comments about it. Customers have ideas for improvement, they can help you in your development process by giving their opinions while you are just developing a new approach, they can participate and share and by doing so, expand company’s reach and presence in the eyes of potential customers in a very positive way. Customers can help each others too, like web developers have done since the dawn of internet. Open innovation platforms like My Starbucks Idea, Dell Ideastorm or Innocentive have led the co-created product and solution development for a long time already and new, very cost efficient cloud based services like Ideascale have emerged. Social Media and open dialogue with the customers are really making a major difference and consequently forcing companies to do better.

From corporate led to customer led
Think about your self as a customer, to which brands are you truly committed? Then think the other way: “Which brands are truly committed to you as a customer”? I would guess, there are very few, if any that you can think of. Since the industrialization, society’s chance to specialized roles and growth of cities, the availability of options has steadily increased. Early on, the producers could just produce as much as they could as cheap as they could and that was enough. Now we are living in the world where there is too much of almost everything. Just producing at lower cost and higher quality isn’t enough anymore. We have now entered the experience economy that requires companies to adapt each and every customer’s personal lifestyle and needs. Offering everything to everybody equals spamming, and indifference marketing. Such marketing is a statement: “ We don’t really care about you, but here’s everything we got”.  Oracle Eloqua made a study about how often the sales people are actually contacting customers when the time is right for the customer. Majority of contacts are done at completely wrong time. Just being able to recognize that single thing makes a major difference in customer experience and operational efficiency.

From outbound- to inbound marketing
Previously a seller was looking for a customer, now customers are looking for solutions. The all-knowing Google is the most important route to most products and services and Google’s page rank is the key to the gateway to customers. Because all information is now available all the time, people want to check and make sure that they are making a smart decision or they look for options in general. Regardless which is the case, the company does not exist in the customer’s consideration unless it has very high top-of-mind score or preference rate. Most companies don’t. Once customers actually land at your site, the whole game is about conversion, whether you are capable of creating a connection with the customer or directly closing a deal. However, the fact is that people make their decisions and also transaction online and inbound approach to marketing is really becoming a very meaningful approach.

From guessing to proof driven continuous analytics, data and automation
Right now, pretty much anything you do can be measured. The availability of data has exploded while the cost of technology processing that data and making it possible to act on the data has slumped. The most pressing challenge now, is to educate people who know what to do with this capacity. You can track the customer’s transaction history with CRM, online behavior with marketing automation tools and you can even track potential customers with cookies and adapt to their behavior without them giving you any information apart from their actual behavior. You can track people’s organic journeys, interests, motives and landing sites, actually the entire market logic of preferences and customer flows between different brands and demand driving with online & search analytics. The web should be considered as the world’s largest quantitative research panel that is entirely based on actual behavior instead of opinions. Such access to information that is mostly free is really shaking the marketing and business communities in general.

From online to mobile +
There are now more connected phones to internet than computers. Online is now always on and always available. A computer was mostly used at home or office, but tablets and mobile phones are present where ever you are. The app explosion and location availability are now changing the entire role of internet enabling companies to really adapt to customer, time and location. The rise of HTML5 is making all online assets available in very intuitive and user-friendly way in any given gadget or platform instead of doing everything several times for native solutions. The dawn of “internet of things” is at hand and enable customer to have a “Sixth sense” that helps her to navigate in the actual world with more information, directions and advice than ever.  On the other hand it does enable companies to really become truly customer centric.

From Online back to Analogical (Personal Anological communications become premium experiences at the digital era of minimizing contact costs and diminishing traditional direct marketing)
When ever some major change happen, there will be a counter trend. Although everything is now going online and we love it, personal analogue communications are becoming signs of premium customer care and experiences. A simple letter has become rare approach. I was involved in a case where we approached  CEO’s of stock exchange listed companies. It was difficult to think how to get their attention and get to them directly without becoming cut off by an executive assistant. Eventually the solution was simple, a letter with a hand written address and a real stamp. Everything about such approach communicated intimacy and purpose. Such approach is as far as it gets from mass communications and that was exactly the reason why the campaign got 30% pull rate. The same apply to consumer communications. How would you feel, if you got a letter from Google or Facebook, that had a hand written address and a stamp? That would really be something J The person to person communications and customer service over phone are also having similar impacts, in case the service is working well. Although brand are now living in internet, we are still people who create a trusting relationship with other people.  That is a fact we should never forget.

From selling to servicing
We all have been sold to. That is not really a pleasant experience. When you are looking for something you would appreciate someone who would make your need their interest and do the best they can to get you a best possible solution. Sometimes that solution is not delivering the highest possible profit margin in short-term, but it sure does deliver in so many other levels. The customer is much more likely to come back, endorse the company and deliver much higher life time value. Shortterminism is the plague we need to cure. When ever you communicate with your customers, delivering them honest advice will sell more and increase impact of communications.

From Solo unit to collaborative accelerator & From second-rate corporate practice to management imperative
Marketing has been a solo unit that has been concentrating on promotion, brand awareness, -preference and -attributes. Those days are now behind us. The same measures are still important, but the marketing unit is required to take more commercial responsibility for customer interfaces and customer contacts in general. The very heart of marketing has always been the customer understanding. That is now more important than it has ever been. Customer centric business model demands marketing to spread available customer intelligence people operating in all customer interfaces. Management, corporate strategy and operations are now required to have their foundation on customer understanding. Because of this, the role of marketing is becoming a true management imperative and driver for customer centric corporate transformation. These are truly exciting and inspiring times!
Articles for more insights:

Marketing’s new and re-designed 7P’s

Marketing Mix 4PMarketing used to be about making companies APPEAR to be better, increasing brand appeal etc. Today marketing is about MAKING BETTER COMPANIES

The omni-channel, real-time, everything’s available and traceable environment we are currently living in has changed the marketing fundamentals quite radically. The world is no longer the same place for which The marketer E. Jerome McCarthy proposed the four Ps classification in 1960. This age requires us to re-design them. Actually, in my opinion we should question the old truths and re-define the entire concept, role and meaning of marketing.. go back to the fundamentals and adjust them to this time and age. I hope this article sparks interest and willingness to join in and continue the discussion at Future CMO LinkedIn Group

The new 7P’s

  • Position – in customer’s mind
  • Performance – the user experience, capability to meet expectations
  • Proximity – How close the brand is to it’s customers, Customer intimacy
  • Price  – Price is no longer a fixed figure
  • Presence – instead of Place
  • Perceived product
  • Promotion

POSITION

There is a lot of everything. Customers instinctively make their lives easier by using their mental shortcuts, heuristics, in order to make sense of the surrounding wealth of messages and impulses. The position a brand holds in the customer’s mind connects it to certain attributes, contexts, values, benefits and purposes. Actually, our brain gives an emotional tag to every single piece of information before entering our conscious mind. Branding is about training customers’ brains and winning certain position in their minds. This is why it takes a long time to really gain a meaningful position as a brand. That’s also why brand extensions are not a certain success, as the position the brand has in customer’s mind only consist of certain learned connections.

Because of these reasons I would define Brand as a position in the customers’ minds. During the past decade people have also learned to use brands as their road signs when searching for products, services, solutions, ideas and inspiration. For example in travel and telecommunications markets the number of category searches has dropped, while brand searches have increased. Instead of searching for smartphone or holiday, customers search operators, smartphone manufacturers and travel agencies by brand. To people, brands stand for direct access to information they are looking for. Such behavior makes the top-of-mind position even more important than it has been before. Smartphones or 4G are minimal interests, while Samsung and Apple have strong demand. The data also shows how Android has become a brand on it’s own and has an even stronger demand than Samsung has.

Mobile Google trends

PERFORMANCE

When customers do buy a product or service they have certain expectations for what they bought. Depending on how well the brand meets those expectations, it influences the customer’s personal experience and view on the brand’s performance. Value for money experience is a very important measure for a brand and shared experiences influence the brand’s Net Promoter Score directly. Performance should be measured through the customer’s entire relationship with the brand, across every single experience they share. In my opinion we should include PERSEVERENCE as part of the performance. The customers expect you to stay interested in them and continue to deliver high value. One-shot experience is not enough, no matter how good it is. The real performance must be proved over time also in case of product failure or other unexpected events.

In September 2013 HBR published an article: “The truth about Customer Experience” by Alex Rawson, Ewan Duncan, and Conor Jones. In their experience, most companies measure customer experience by touch points or single engagements. Such an approach will tell you how did that single engagement meet customer’s expectations. It does not say anything about customer’s satisfaction over time. In case this is the only mean to measure performance in a corporate KPIs, it will create an illusion of performing well. In their article, they proved the declining customer satisfaction over the length of customer relationship. When you think in terms of performance, you need to continuously improve your service, in order to keep your customers happy. In my Customer Journey studies I have also learned that, the reasons why customers choose to buy a certain product, or a service, are not necessarily the same ones that will keep the customer happy post purchase on a longer term.

Performance measures are also changing the marketing as a practice, changing management and the ways of managing change. Today, everything can be easily tested in small scale, scaled to global level and measured in real time. The marketing practice has been measured with rather elusive figures like top-of-mind, preference, awareness and attributes until recently. Now marketing has become an actual business unit that should have a business plan, revenue forecasts and profit expectations. This is finally something that other members of the board understand. This is why the marketing as a practice is moving up on the corporate power ladder. Corporate management is already expecting CMO’s to take responsibility for corporate digital transformation. In my opinion the creativity factor associated with marketing function has more potential in this new order than ever before when its performance is measured right. When customer understanding, creativity and performance metrics are connected across corporate strategy and operations, possibilities of developing business, competitive advantage and brand become infinite. We just need to follow the path companies like Tesco, Apple, Google and Amazon have opened for us over the past two decades. In that time the technology and ecosystem developed to its current level of sophistication and accessibility allowing us to join in and follow the paths these giants have already proved effective.

PROXIMITY

Proximity is a synonym for distance. In order to create trust and relationship with customers, brands need to get close and personal with their customers. At best, you can talk about customer intimacy and connecting the brand to people’s self image. We have a chance of having a dialogue and become a part of peoples everyday life via different channels like Facebook, apps, online services, even external bought mediums at personal level. Although the Internet and all it’s applications have a lot to offer, PEOPLE belong in this category too. Person-to-person communications are the primary way of connecting and even getting imprinted to the brand. People and corporate culture represent the brand in human form. The old truth about brand being as good as its salesman is still true. Customers meet people while making their choices, have support needs or they want a reclamation taken care of. People are the very core of trust experience and in many businesses customers imprint on people serving them. In such cases the brand experience and loyalty has it’s foundation on personal relationship: it’s not about B2B or B2C, it’s about Human-to-Human. The current view is, that those companies that best connect their physical experience in an omni-channel world will win the hearts and minds of their customers.

In my opinion the Apple Store concept is one of the best examples of creating a strong human interface and online customer relationship together. The experience at Apple store is that all employees are there for you, concentrating on your concerns and help you with your needs. There are often more employees than there are customers, which just stands for Apple’s priorities. The store is a place for brand experience and it is not measured by sheer efficiency like most other stores are.

Apple store

Picture source: http://zerogeekspeak.net/2014/06/16/av-forward-training-customerprofessional-relationship-dynamics/

PRICE

Price used to be a rather fixed figure. In this age price has become a rather elusive measure. The new approaches to pricing are about yielding models and price variety between customer segments or distribution channels. There is one price for me, and another for you, although the product and the seller are the same. There is a price for me right now and another tomorrow.

Online environment has made it possible to democratize offering and make pricing transparent by using aggregators and comparison services that find prices from different sellers and present them in one single view. This kind of approach has democratized the marketplace, because the aggregators only show certain comparable basic functionalities and push the brand further away from the customer. This approach has increased the meaning of pricing volatility and transparency. People on the other hand love such services, because the offering with large selection, customer reviews and low prices can be found and bought from a single location fast and conveniently. Actually these players like Expedia that is offering Hotels.com, expedia.com, Trivago and those alike them, are creating direct relationships with customers and effectively drive prices lower (and their profit margin higher because they effectively own demand). Smaller players, who have less known brands but can offer services and products at lower cost, can access demand and challenge better known brands due to this logic.

The demand for lower prices is growing and now it’s also connected with certain brands known for their low prices. In January 2014 Amazon reported that its’ more than 2 million marketplace sellers sold more than a billion units globally. In their annual report Amazon also reported higher profit margins, because everything they sell in their marketplace generate pure profit. Amazon, like big brands, have the demand, selling other businesses’ products don’t cost virtually anything for them.

Here’s how demand is developing in case of accommodation business:

Travel Google Trends

PRESENCE

I think that presence has replaced place on this list. In the digital era, presence equals availability and direct access to buying. Presence is a more flexible concept than place that is physical. Social media is a method of expanding presence across customers’ peer groups and generating recommendations, participation and coverage in general. Aggregators also scale presence further. Customers will choose a brand among those present. It is to say that expanding presence is likely to directly impact sales. Out of sight – out of mind, is the name of the game.

When I have been studying Customer Journeys and customer’s decision making, I’ve learned that there exists a market segment of people who are at the state of “pending decision” or “pending action” in many categories, especially in case of consumer packaged goods. Let’s say that you, for example, need to buy a new toothbrush and you decide to do so. The decision is already there, but it could take months before you actually make the purchase. In such cases the sheer presence where customer makes the purchase increases sales even without any kind of promotion. The same logic applies in many other cases too. I have personally become completely loyal for a contact lens seller LensOn. They send me an email once my previous order is likely to be nearly consumed and I only need to click once to renew my order. They know me and their presence takes place at the right time inside my personal space. I consider that great service. Their presence is perfect – out of sight and not bothering me at other times, only serving me proactively when they know I need it. LensOn has effectively increased my contact lens spending, because I have not run out of them since my first purchase, almost four years ago.

PERCEIVED PRODUCT

A PRODUCT is too often defined by companies as how they see and envision it. This is naturally flawed/biased and is where many companies make a mistake in the first steps of selling and marketing their product/service. Especially engineer lead organizations that are very product detail focused. In reality this should be PERCEIVED PRODUCT, making an enormous paradigm shift from companies defining a product, to understanding that the PRODUCT is actually only and exactly what we can get the consumer to perceive it to be. This adds the element of communication responsibility and understandability to the 7P’s equation. Most companies think they have the best product, but still fail, because of an enormous perception gap in the definition of the product in their minds and the potential customers minds. Perceived Products is naturally tightly linked to the second P = PERFORMANCE, which is all about (repeatedly) living up to, and exceeding the product perception and quality expectations of the customer (The definition of Perceived Product came from Jarno Aho, OMD Finland.)

What makes the concept of Perceived product especially important, is the fact that customer experience about a product or service is firmly embedded on expectations. When expectations are really high, it is difficult to meet them. On the other hand low expectations are easy to exceed and translate them to endorsements. Perception has a major influence on brand demand and preference. Branding has everything to do with it.

PROMOTION

Here’s the Wikipedia’s definition: “All of the methods of communication that a marketer may use to provide information to different parties about the product. Promotion comprises elements such as: advertising, public relations, sales organisation and sales promotion.[1]” Another way to approach promotion can be divided in four major categories:

  • Owned media (own customer interfaces and direct channels for customer communications)
  • Earned media (social media and PR)
  • Partner media (retailers, resellers, bundling and packaging partners, etc.)
  • Paid media (advertising, SEM, etc.)

Important measures for promotion are reach and impact to brand awareness, preference, willingness to pay premium and convert sales. In the Internet age of overwhelming availability of data, own media has increased it’s capacity to impact sales tremendously. Search engine’s page rank can be improved, own customer data can be leveraged very cost efficiently and the relationship with customers can drive further reach with earned social media and dialogue with customers. In the current online centric customer relationships in which marketing and servicing merge as one single messaging, it’s increasingly difficult to define where the product or service ends and marketing/promotion starts. You could say that the core customer service and customer relationship processes have become promotional activities in the age of open online dialogue. Partnering influence reach and presence very effectively too. These new possibilities have diminished the role of paid mediums and increased promotional capacity and scalability at a low cost. Data driven marketing enable paid media’s role as an extension of customer relationship marketing even if the customer has never left his/her contacts.

These were my 7P’s. In case you can agree with them, I’m sure you can also agree with this. Marketing used to be about making companies APPEAR to be better, increasing brand appeal etc. Today marketing is about MAKING COMPANIES BETTER. The difference between these two roles is so great, that it demands us to open our eyes and re-define marketing as a practice for the needs and opportunities of today.

Further reading:

Marketing has an identity crisis – Blue Ocean dashboard

I just found Dr. Rod King’s Blue Ocean dashboard and process tools from SlideShare today and thought about how necessary it is to understand the whole value creation process in order to manage brand effectively. The number one branding responsible inside the company is actually the CEO, as he is often the only person in a company responsible for the total experience.

Brand identity is a reflection of the company, it has to be real and true. False promises and wrong kind of identity only generate dissatisfaction and distrust. You are what you are and you can improve, but you can’t stretch too far. Marketing is often responsible for the identity design, business managers are responsible for the experience. This approach doesn’t work anymore – The brand from the customer’s perspective is one single entity and the experience and perception must be a solid combination.

Mr. Graham Hill, well-known and great CRM and customer experience expert whom I respect very much just published an article: How Stupidity, Short-termism and Immorality Ruined Marketing in Customer Think -blog. Here’s a quote:

“If you take a step back you will see that the ethos of marketing has changed over the past 50 or so years. It used to be the driver of a three-step process of 1. understanding what customers want, 2. organising to give it to them profitably and 3. telling them all about it.

Today, this has been changed so that marketing is now the driver of a much more intrumental three-step process of 1. create more stuff that we already make or that competitors make, 2. tell customers about it over and over again, and 3. manage away the customer queries, complaints and returns as cheaply as possible.”

In my opinion the article just emphasized how important it is to act now and change the way how companies organize for marketing and define the role marketing has within the organization. (Below the article there is also great dialogue about the matter.) Read here

The CMO’s should have the best view on how the customers both perceive and experience the company and translate that reality for business owners and the CEO. Mandate for this position comes from the customers. The CMO’s role is to understand how the product/service range and customer experience influence the overall value experience, brand perception and preference, demand and capacity to generate premium pricing. CMO should define how the company should position different products and services in order to optimize the overall growth, sales and profit margin.

Dr. Rod King’s tools for Blue Ocean dashboard tool felt like rather easy and rapid tool for over all view creation, opening eyes for the whole. Here it is:

Naturally branding and brand identity has a lot to do with subconscious and emotions along with rational mind. The business owners are  rational, which doesn’t guarantee success and most certainly doesn’t drive willingness to pay premium. Business owners often demand rapid results, which easily leads to tactical marketing emphasis, which only decline people’s willingness to pay for quality and drives opportunistic customer behavior. This is where marketing must bring the magic in. Creativity has more demand now than it has ever had due to the cluttered market and overwhelming amount of marketing messages everywhere.
Marketing has a strategic role inside the corporate hierarchy, it’s time to act and wipe away the perception of marketing, that is now dominating business owners minds.
Let’s face it. Marketing has an identity crisis and Marketing as a “brand” is suffering from wrong “brand perception” and customer experience defects. Lets re-define the meaning of marketing, polish the “brand” and it’s value for other corporate board members. This is why Future CMO Movement was founded!
I hope this community could become a place for game changers to exchange ideas and share experiences. In case you think you would have great material to share, please contact me and I’ll grant you author rights for this blog. Contact me via toni.keskinen(at)gmail.com
Also check out these articles:

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join Future CMO Movement LinkedIn Group here

McKinsey’s Five digital trends shaking up Europe (infograph)

McKinsey – 5 trends in European digital consumption

More @ http://cmsoforum.mckinsey.com/multichannel-delivery/infographic-five-digital-trends-shaking-up-europe

Managing brand – the most profound KPI’s and their impact

Brand as a roadsign

If your brand was a road sign and didn’t have context, emotions and expectations attached to it, it’s like there was no sign at all and the road to destination wouldn’t look comfortable or secure. If the sign does have a meaning for the customer but you are trying to sell something that is out of that world, it’s likely that you face difficulties creating interest, demand and closing deals. Brand extensions are not an easy game either and you should be prepared to work a long time to change and expand your brand perception before making money. Brand can be associated with very narrow specialty or more generic qualities. However, brand is not brand if it’s not recognized and it doesn’t stand for something. Virgin is a great example for a branding of attitude and founder’s mindset more than specific product or service range or Apple, which has done usability and design profile along with technology. Technology isn’t why people pay more for Apple than PC though. You can become a mini brand having all qualities of the brand in smaller area or niche business and then expanding that area. That’s the most likely way of actually succeeding in brand building profitably. (Check another article: Brand as a roadsign)

Real brands can emphasize optimisation of buying when they are considering customer journey. People pay attention to their signs and are likely to consider them when choosing a solution from the brands context. It’s about keeping the customer’s attention and closing the deal. For labels, it’s about selling.. and selling cost money. No one will buy a label unless it’s much cheaper or someone actively sells it to the customers. This is a major challenge when trying to penetrate a market and getting your product or service noticed and approved. Gillette is a great example of using brand as a defensive force. When new brands have tried to enter a market, Gillette has issued 3 at the price of 2 offers and stuffed people with their products for a year resulting zero sales for the newcomer.

The most profound brand related KPI’s (Key Performance Indicators) that influence the customer journey and commercial success most are:

  1. Awareness
  2. Top-of-mind
  3. Preference
  4. Brand perception = attributes that translate as customer perception of context, value and personality
  5. Liking

Brand awareness

Brand awareness, spontaneous and aided, are profound figures. A roughly acceptable brand heuristic is that awareness often equals trust. If the brand is well-known, it is likely to be considered and trusted also. However, there are eg. Car brands that are very well-known but don’t have appeal resulting sloping sales regardless of their brand awareness. If the brand is un-known it doesn’t exist in customer’s consideration and therefore has no way of making major sales without very pro-active sales activities or increasing the awareness of their brand. Even if a customer would notice the brand, he is likely to ignore it.

Top-of-mind is a figure telling which brand people first think of, when asked to tell which brands they would consider. In many cases top-of-mind is very important. Especially, in fast-moving consumer goods and e.g. Phone services in which people call to ask for advice. 911 must have almost 100% awareness and a top-of-mind position in order to be able to help people when they need it.

Preference rate could be considered as a GPS device that takes the driver to the right destination. When you are driving with a GPS on, you don’t actually pay attention to alternative options and act on the directions the GPS is giving for you. Strong habit and strong preference rate have very similar behavioural influence. Preference is often asked from customers before they actually initiate buying process. It’s a measure telling what brand people think they would most likely buy. It’s an important indicator of brand health and should be treated that way. It is a meaningful KPI figure. However, it can also be misused. In most brand-tracking cases that we have seen people have been told to choose the most preferred brand even if they didn’t have one. We have allowed customers to give none as an answer. No preference combined with potential brand options has been a very efficient way of capturing business dynamics. In some businesses we have analysed 76% of customers had no preference but a majority had three brand options that were equally good in customer’s eyes. There is no GPS to consider in those markets. No preference percentage gives a meaningful indication of customers consideration but it requires from the tracking that it also track brands that customer consider as option for the most preferred brand.  If the brand you are working for is not in top three as a preferred brand or is not considered as an option, your brand doesn’t exist in the customer’s consideration. The very first thing to do in case of any business is to become considered! If you are not considered, no one will buy you unless you sell the brand in actively.

Let’s consider a practical case in travel for example. TNS and Kantar Group are offering national and international studies that have very large sample size and concentrate on customers’ perception of brands, their most recent purchases and lifestyle. In case of travel you can share customers to roughly three groups:

  1. People preferring your brand (Lower distraction sensitivity – driving on GPS)
  2. Neutral customers, who consider you as an option along others (no GPS) and
  3. Those who wouldn’t even consider you or would certainly not buy

Based on such data, mostly used by media agencies for their clients, you can tell how many people are in each group nationally, what have they purchased most recently and what are they like, demographics, lifestyles and behavioural preferences. Having this knowledge is a great eye opener and really supports management work in defining priorities and how to engage with people. Behavioural differences between preferring customers and neutral are very important. Considering sales the ratio of preferring customers is around 2/3 most recent purchases and in case of neutral customers around 1/3 or less.  Customers who are neutral let all competing brands to their consideration and check all available offers or use comparison platforms, which narrow comparison and democratize brands to same level of information. In such environment brands lose their opportunity to create unique experience and services in a meaningful way. Preferring customers on the other hand come directly to company’s website or directly contact their customer service and thus allow direct service experience by the brand.

BRAND PERCEPTION

Brand perception has to do with people’s heuristics of the brand. What the brand means for them? What is it related to? What is the context? In different businesses there are clear factors in brand perception that have a clear connection to sales. Such factors could be eg. Trust and security, technically advanced, great design, cool, fun, high quality, leader in trends, most durable, etc. In each business it is important to leverage qualities that influence decision-making most and stay in touch with the market and what kind of qualities drive it. The change of drivers could be fast and profound like it was in case of Nokia. Nokia is no longer the most appreciated mobile technology brand it used to be. Apple’s iPhone and Google Android are shaking the business profoundly. Understanding which attributes drive sales, marketshare and preference should guide the priorities in brand development.. in all customer interfaces and communications.

BRAND LIKING

Preference often require conscious consideration, comparison and decision making. It is best suitable for product and service areas where you make “bigger” decision. Liking is more subconscious and spontaneous emotional reaction to the brand. Liking could also be the first step to preference, an opportunity to become noticed and considered.

Liking the brand is a figure that has become more and more important due to digital influence. You can have high preference without liking because of superb product price/quality without being liked very much, but liking the brand has direct influence in preference even if your qualities were not quite that superb. There’s more to liking though. People have more currencies than the content of their wallet. They can speak their mind, write blogs, rate your product, influence your search results or offer you very important feedback or ideas for improvement.

Brands cannot be “created” one way – it’s the people’s perception of a company or product. Brand is no longer a noun; it has turned in to a verb. You could actually think brand as an agreement between a customer and company. Customers can agree or disagree with the agreement, resulting a perception, which could be good or bad. However, a brand cannot exist without the other party. Brand is social by nature. Still, a brand has never been as social as it has now become because of social media and online influence channels that customers are now very effectively and actively using. Customers have real power now that is global, not just local peers. No doubt that customer behavior has changed. It has completely changed in many areas and will continue doing so. Digital influence is the biggest disruptive force along the customer journey.

In current automated communications and self-service oriented world where customers are made responsible for servicing themselves there are many practices that don’t really support brand’s emotional development. Majority of companies consider customers as mass medium, measure “cost to serve” and try to push cost down, build loyalty programs that ask you to buy more and show loyalty in order to get higher discounts and benefits or offer time based commitments as agreements for discount. It’s very much a world of rational thinking. Rational is good but also neglect customer’s social currencies as value. You could call this approach “the indifference marketing”.

In social mediums people interact with their peers. It’s often, but not necessarily, a private space. In this space a brand could gain enormous value if customers would accept it within this context. A customer has enormous social capital. He can judge the brand as stupid or embrace the brand and support it. Customers are actively using their capital and they are getting more and more effective tools at their disposal just to practice this capital to the most. For example WOT, Web Of Trust, crowd sourced trust-rating of websites and brands has currently almost 60 million people rating brands and websites. Any people who have WOT application in their browser has reputation score visually presented after every single link available online.

WOT is a wonderful example of customers’ currencies becoming more and more influential. WOT is an ultimate rating tool. If some company act unethically, spam, or in any way prove not to be trustworthy, >30 million people in WOT start giving red to the brand . As an outcome, company’s online reputation score will become lower and eventually red. Red means, that if you try to enter the company’s website, you get a full page size warning stating that other people have rated this site to be dangerous and not trust worthy. Would you do business with such a company?  How likely are you to do business with a company like that has bad trustworthiness?

Social influence online has an enormous steering power. As people treat brands and companies as entities anything and everything the company does also influence their trust rating. If a brand is misusing child labour or employees, has unfair practices, questionable ethics or doesn’t respect environment, it shows in their trustworthiness score. Customers currently rely very much on other online users feedback, even if they are complete strangers. As companies have noticed that people love to rate products and brands and are interested in comparing them, new companies and services emerge constantly. The power is moving a way from institutions like traditional mediums, which have made product reviews and thus defined which products sell and which don’t. Currently smart brands are turning customers to their ambassadors and creating same effect, only it’s completely dependent on people, the customers, which make it feel very interesting and trustworthy.

Currently customers are taking the ultimate power and becoming sellers them selves by turning blog pictures in to online retail channel with Kiosked –service (kiosked.com). E.g. A fashion blog can sell every single garment or accessory represented in photos appearing in the blog. People are creating their own audiences and creating their own image by blogging and making their bellowed products available for followers and readers. Brands are just chips in customers’ games, which they can endorse or decline. Again, liking the brand is the number one thing driving such endorsement.

Liking influence all currencies the Customers have:

  • His personal detailed information
  • Promise to record purchase history (loyalty card)
  • Decision power to all his own purchases
  • Freedom of speech and opinion
  • His own time
  • His personal peers and personal status amongst them
  • Endorsement
  • Own creativity, experiences and ideas.

Of all the currencies above, I argue that most are not rationally driven and liking the brand influence them all!  You can’t tell people to tell others they love your brand or tell them to recommend your products and services to others. Also, you can’t expect people to help you make your products and services better unless they do it with their own free will. It’s all about liking.

The most advanced brands have understood that these emotionally driven assets could prove to be extremely valuable and find ways of harnessing them. Open innovation and customer boards are great examples of just that. The good companies will win. Forget about the Adam Smith’s invisible hand, it’s become very visible and very effective. Blogs, ratings, discussion forums, Twitter, Facebook.. It’s written all over the digital canvas.

SEE NEXT:

How segmenting 3.0 changes marketing and management https://futurecmo.org/2016/03/16/segmentation-3-0-disrupting-marketing-media-and-management/

How to take advantage of Brand’s position very fast with Behavioral Economics Making millions with pennies – Behavioral Economics approach

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

The beginning of customer journey – Initiation

Image

The customer comes to a crossing and stops because the brand successfully engages with him or something changes in the customer’s situation. In most customer journeys there is a defining moment when a person gets actively interested in buying, initiated. That moment can be identified rather reliably. Something makes a person actively start considering about buying something. Active purchasing consideration does create memories because it’s done.. well, actively in your conscious consideration. Active consideration could take years in some cases or it can spark purchase spontaneously. Depending on the category, differences are huge but also within a single product group customers’ behaviour have vast differences. In many smaller decisions the consideration is less profound but still, when ever you are breaking a habit or really considering about doing something, you can recall doing so when specifically asked about it. In fact the customer is the specialist in his own experience and we can learn from him. Best way of getting to know the dynamics and learning about the reasons for people to get interested is by doing one-to-one interviews. Interviews are actually for discovery, expedition trip to customer behaviour and drivers, differences and variety. Group discussions easily make people indicate rational behaviour although it was not. We would suggest one-on-one in-depth interviews or questionnaire before a group discussion asking person’s own thinking. In the group discussion some of the key findings could be thoroughly opened. This kind of approach enables capturing human behaviour more reliably.

There is a methodology in Psychology called Interpretative Phenomenological Analysis (The Psychologist, vol 18, No1, January 2005) It has been developed for analysing people’s lived experiences. The methodology avoid making assumptions and does not test hypothesis. The person’s experience should be recorded as authentic as possible. They are done in one-on-one meeting. Interpretative means that the researcher looks for things that are distinct (i.e. idiographic studies), but will also attempt to balance this against an account of what is shared (i.e. commonalities across a group of participants). Researcher reduces the complexity of experiential data through rigorous and systematic analysis. Analysis relies on the process of people making sense of the world and their experiences. I use this methodology in Insight interviews and then create quantitative study based on these findings in order to quantify which phenomena has most meaning and can these phenomena related to specific business and brand be segmented in some way or result difference between segments and brands.

The best way we could come up when working on One Experience cross-channel buying behaviour mapping tool, was to start with one-on-one interviews and learning about the people’s reasons to get initiated in the first place and continue to map out the cross-channel purchase behaviour.

The initiation of the active consideration is often a result of certain drivers and motives in certain context being prompted to active consideration by certain touch point in certain channel. These reasons, channels, motives, contexts and drivers should be recognized and quantified in different target groups. They are the very foundation of profitable marketing operation.

You can roughly divide reasons to initiate in commercial and non-commercial reasons. Commercial reasons have to do with advertising, direct marketing, outbound telemarketing, retail, point-of-sale promotions, sales people and so on. Non-commercial reasons have to do with magazine reviews, word-of-mouth, actual need because of losing or breaking the old product, tradition based behaviour (e.g. in travelling every year at the same time), change in a living situation (e.g. moving) and so on.

Further, initiation can be divided in initiation in general and initiation to the brand. Initiation in general is about how the customer became interested in acquiring certain product or service in general and these reasons are often non-commercial when asked from the customers directly. This is not completely true because something has created the need in the first place. That’s why it’s also important to ask about their initiation to a purchased brand. Becoming initiated to certain brand is more likely to be commercial. In most cases you can narrow these reasons to a few major ones per segment. This information will help you decide where and what to do in marketing. How to effectively reach people and how to choose the message and content in most appealing way.

The Apple iPod is a great example of a product, which had  ”a long activation” period. The iPods were originally too expensive for many people who would have loved to get one. After some time, the price of the iPod reached tippin’ point, level which enabled most people to get one. At that point iPod rose from most wanted niche product to dominant brand. The MP3 format, iTunes and making CD digitization easy were the enablers of MP3 revolution. ITunes and buying music online were Apple’s strengths. However, the product design and user experience made it the most wanted brand and later on dominant market driver leading the way. Currently it has been predicted that when eye surgery costs come down to the level of 1500€, people choose surgery over new classes. Markets could change profoundly and rapidly.

We have learned from several cases that the brands often don’t know why and from who’s initiative customers got activated. In one case our client, advertiser, was wondering why their demand had suddenly increased dramatically and they made record sales without doing anything specifically. This company had very effective sales process delivering superb customer experience and consequently very high sales conversion. After running customer journey study for them we found out these people were originally activated by a competing company, which had launched a major direct mail campaign. The product was expensive and people wanted to take another offer just to be certain. This incident delivered record sales for the competitor. It’s likely that the active brand also sold more than in average but it’s absolutely certain that they also lost major part of their potential sales.

When you are concentrating on customer perspective you are simultaneously doing very effective competitor benchmarking and learning from their success too. In best case the competitor becomes your best salesman without knowing about it. You can also learn from competitor’s success.

In retail store you can roughly share products in two categories: must have and nice to have products. These products life cycle could vary greatly. In one CPG case that we analyzed we found three most common patterns in getting initiated. The first one was planned. People wrote on their shopping list that they will buy this product. The second was buying in stock when the product was in discount. The third was the biggest one… People who had made a mental note they should buy the product. However, this product was not in the priority list, which resulted ”pending activation”. These people were activated to purchase by just seeing the product in store or seeing an offer about it. The major sales increase for promotion was due to the fact that they had promotional spots that prompted people’s attention and activation by just being there. The sales would have increased even if there were no discounts because people just forgot to act on their decision. In many cases there is latent behaviour that must be recognized in order to optimize profits. There’s no need to offer major discounts if just being there does the job or offer smaller discount or on-top offer in order to justify the extra visibility in store and also activate stock buyers. It also has major indication in the media strategy. If the brand’s awareness and other KPI’s are in order, the most important goal is to have continuous activation going on generating faster re-purchases and increase in the market value. Depending on the product’s role in customer’s life there would also be possibility of creating CRM or social relationship management (SRM) approach that would keep customers active and engaged with them in product and service development.

Testing in the real environment is the only way to get a true business case

Making people move is a fundamental marketing goal. In order to optimize marketing effect, you must study, test and learn what kind of trigger and content create most response. You should also learn in which context or medium people would be most likely to act on the advertising and which interaction channels deliver best results. Consider, what is the role of your own mediums like website, retail or CRM. How can you leverage earned media like discussions online and press or other PR. Are there ways of collaboration with partners that would result synergy and low-cost leads? Where and how much should you invest in paid media like TV, print, radio, outdoor and online. You can manage what you measure and optimizing the mix takes a lot of learning, trial and error to make it right.

The second equally important issue is to learn where you should steer people post activation: online, mobile, customer service, retail or create a first action which help you support customer thru out the journey and purchase. Again, there are good learning’s available but each business is unique.

Consumers want to have control

Today’s consumer want to control the process of choosing and avoid being sold at. Pushing is irritating and considered as a bad customer experience. When customer has a medium in which there is a lot of choice he has the control. Customers choose what to concentrate on, and how much time they are willing to use in learning about product. Customers can choose to continue shopping online, in retail, mail order or to go and see the product live or choose not to do anything.

Advertisers have an opportunity to increase communications to own customers and creating own mediums in print and online. Previously marketing focus was mostly about finding new customers, although majority of the sales came from existing customers. Customer magazines and catalogues are part of customer loyalty, mobilisation marketing. The respondents consider the magazine or catalogue as respect of customers own space, time and consideration.

Buying is not easy

Marketers often assume that selling is hard and buying easy. For customers it is not easy to really understand the scale of offering and relevancy of it. At personal level they have ways of learning in their own time. Often the retail experience is too hectic and nervous for learning at own speed. Online services and catalogues allow people to have their own time and space. In one case outbound represented majority of initiation, but fraction of the transactions.  Banner ads are often judged wrongly due to this – people initiate but make transactions elsewhere.

Consumers consider concrete pricing, product pictures and good presentation of products as valuable service that makes buying easier. It’s easy to see for example how much catalogues and online travel advice decrease the need of personal advice from travel agencies and enable online buying.

The difference between emotional brand advertising with very little information and buying information sources is obvious.

Conclusions about Initiation

Initiation and getting activated is about prompting attention and making the person move. No matter how long there has been a latent interest, there’s always something that changes in offering, customers situation or the market that gets people activated. What is that, what is the motivation behind, what is the customer’s mindset at that point, which brands customer considers as options, which does he prefer if he does? Understanding this has a major influence in the overall marketing strategy.

In order to understand how customers are best reached it’s also important to understand the need of advertising and shopping consideration. For many brands there would be possibilities in helping customers learn about their value proposition by really making great product descriptions and photos for shopping medium use. Although the customers would not buy from these sources, they still learn from them. That’s free media that really hit the target. Brand’s own online service should be the source of ultimate information that really answer customer’s questions and engage with the customer resulting action.

When we were studying the different mediums capability to influence customers and how brands currently work, we came to conclusion that when brands are rapidly learning new, they are simultaneously forgetting old. Customer’s behaviour does change but when competing retail brands e.g. drop catalogue and go purely online, the other brand might gain advantage.

When measuring success brands should concentrate on how much did the advertising change customers perception of the brand positively, did the advertising justify higher price or increase the interest in wider audience with current price or did the advertising just activate people with discounts, which is good in the short run but could damage the brand in the long run. Which mediums performed best compared to the investment? If some mediums under performed was it due to the medium or advertising content? If you can answer all these questions post campaign, your capability to improve further is much better and you can actually predict outcome much better than previously which justify the spending.

What do you think? I’d love to get some comments :)

If you liked this one, check out how to manage customer interfaces and pre-initiation stage along the customer journey Brand-as-a-roadsign.

An article about the next stage in Customer Journey here: Choosing and buying – cross-channel influence

More advice about how to map and stury customer journey is available at https://futurecmo.org/2012/12/01/how-to-map-and-study-customer-journey/

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

CMO challenge – How to organize marketing for success?

This time this article is more about a question, than an answer. We do need to change but to what? Earlier on I wrote an article about how the creative work and marketing planning will transform in to something new.  As we do know the brand’s own customer interfaces are becoming more and more important as a media and amazing tools for continuous relationships and engagement. Customer interface management is becoming do or die for CMOs. Understanding Customer Journey and the dynamics around it are becoming the new black in planning process. Altogether the priorities are rapidly changing as well as the the organization and world around CMO. Forbes just published an article about “The end of Expert – Why no one in marketing knows what they are doing?” 

“It’s a stark verdict from a prominent source. “There are hundreds of thousands of people who were trained and mentored, and studied classical marketing, and they got good at it,” says Clark Kokich, chairman of digital agency Razorfish. Unfortunately, the world has changed – and that education is no longer relevant. “If your self-worth and your confidence is based on you being an expert, you’re in deep trouble, because there aren’t any experts,” says Kokich, author of Do or Die: Surviving and Thriving in a World Where the Old Ways of Marketing Aren’t Getting It Done. “Sure, there are experts in some fields. Someone may be really good in SEO or in mobile. But there aren’t any experts in making this transition”

So, how should CMO arrange his/her internal organization and how should creative work be a) created b)produced and c) measured. How should the marketing overall work flow internally and externally? What kind of partner structure would be ideal? What to in-source and outsource?

There are several task to take care of:

  • Define who are your customers, what kind of behavior do you want from them and what kind of actions actually deliver such behavior?
  • Define how do you reach them and how do you communicate with them
  • How do you create and manage own web interface, social media interfaces, customer service, retail, sales,..
  • How do you create big ideas that inspire and contribute to the corporate overall image as well as turn these inspirational ideas in to customer experiences?
  • How do you measure and quantify, learn and implement continuous change?

Earlier on you had one agency for above the line creative design. These guys were the kings of the hill and everything else was less important. Then you had below the line agencies for Direct marketing, email marketing, in-store promotion, promotions in general, marketing PR, SEO and SEM agency, media agency, research agency, online agency,… Well, you had all these agencies and you had internal organization and a person to run each agency or discipline along with budget allocated for that specific purpose. eg. Direct marketing. This kind of world view has died over the past five years.

The new world is still under construction. You have now creativity in media agencies and analytics people in creative agencies. The new ways of organizing and sharing responsibility  are just emerging. This is why I hope you could participate and share your best working practices and experiences for collaboration.

SEE ALSO

“The CMO 2013 Study insights and what CMO’s should do now”

Lost insights and Corporate Blind Spots

Business Design with customer centricity

How to enable smart company and avoid corporate autism

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

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