As I’m guessing everyone is aware of by now, MLC’s B2C team is currently knee-deep in our 2012 research project. This year, we’re looking into analytics and “Big Data” – a space where there seems to be a lot of potential (and a lot of hype) but not too much in the way of best practices or frameworks for moving forward.

So we’re currently trying to tease out, exactly, what people are using analytics for, and what ultimate goals those actions feed into. When we’re on the phone with members, overwhelmingly we’re hearing that data brings enterprises closer to the consumer, leading to all sorts of better outcomes: more resonant marcomms, higher margins through more effective price discrimination, and, for some companies, better products that arise through access to protected, proprietary data assets (like Nike+).

I could imagine two ways that data might feed into customer centricity (whether it’s helping or hurting). Story number one more or less goes: we as a company had very little idea who our customers were, what they liked, how they socialized and what kind of products they bought from others that they could be buying from us. When we integrated advanced marketing analytics and unstructured data, the numbers told us more about our customers than we already knew, and we became more customer-centric.

The other story goes: we as a company had very little idea who our customers were, and therefore we integrated big data and advanced analytics. But we couldn’t choose which data to use, and our analysts and marketers got caught up in a never-ending cycle of analysis paralysis. Moreover, thinking about the consumer as an abstract concept in data led to people forgetting the importance of experience and observation. In the process, we lost sight of the softer, qualitative ways that we learned about customers, and ended up becoming less customer-centric.

Which of these is more plausible? I’m not sure, but my gut says it’s the second story. I can count the number of companies with great, consumer-apparent uses of data on my fingers and toes, and analytics vendors have bigger appetites than that; there are surely hundreds of companies out there with data on their hands of varying effectiveness.

So, we thought we’d bring the question to you. Answer the poll below to let us know how you feel about data and analytics’ role in customer-centricity. Want to add some details? Let us know in the comments section.

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If you’re a B2B marketer, you know that one of the biggest overarching trends in your work over the last few years has been the gradual complication of the sales process. Budget pressures facing business buyers, the greater availability of information via the internet, buying committees and all sorts of other roadblocks and tangles have managed to fit their way into the path between Sales and the sale.

These factors are creating the “no-man’s land” facing Marketing and Sales, one that we told you about last summer in our annual B2B research project. But they’re also making Sales’ job harder by making the process more complex: when buyers have ideas in their head that they get from internet research, or when a committee makes a purchase, rather than an individual, complex contingencies quickly develop, ones that can be hard to manage for individual reps.

Johnson Controls, an industrial controls and facilities management company, sells complex products and solutions. Its reps ran into the problem described above, and had trouble making complex sales. The company’s solution was to embrace game elements to help reps unearth critical, unarticulated customer needs that aren’t being met effectively – and, in turn, reconcile competing priorities among multiple stakeholders.

Johnson Controls first gets all the stakeholders into a room and asks them to fill out two kinds of cards: “needs cards” represent key priorities for each participant in the buying process, and “practice cards” represent the organizational actions needed to meet the needs.

Cards are then mapped onto a special gameboard developed by Johnson Controls, that graphically represents where the customer thinks critical needs are going unmet. Armed with data and benchmarks from across the customer’s segment, reps can challenge customers in the moment by comparing them to competitors.

For more, including how Johnson Controls reps balance multiple priorities among stakeholders, check out the full case, or listen to this webinar replay to see how this and other companies have revamped their needs assessment process.

With social media moving towards the maturity phase in a number of big companies, we’re finding that more and more members are looking for formal plans from their social media teams – detailed ideas about what the team will do in a channel in a given year.

That might work (and be necessary) for TV, a channel where ad buys have to be coordinated months in advance and audience preferences don’t change too much. But for social media, where channels change near-daily and audience behavior is still in flux? We think companies should be focused primarily on experimentation and flexibility – and that plans should optimize to those goals.

Our Social Media Plan on a Page will help get you there – it’s a five-step method for creating a world-class social media experimentation strategy, one that’s grounded in enterprise priorities and audience preferences. Here’s what you’ll do:

Ground strategy in business objectives. Pick – and fully understand –  your company’s 2-5 growth priorities for the year. This guards against wasting time and money by choosing projects that don’t mesh with enterprise-wide priorities.

Assess your audience dynamics. Dig deep, and understand how and why your target audience consumes social media. Make sure you have an idea of where consumption might be headed in the future by identifying your lead users and examining their behaviors.

Identify your strategic opportunities. Explore how social media can help your company accentuate its strengths, as well as meet customer needs in ways that are difficult for competitors to replicate.

Select the highest-potential experiments. Determine which near-term experiments in social media will help position your company to take advantage of longer-term strategic opportunities in social media.

Measure your social media efforts. Use a “Return on Objectives” approach to assess if and how your social media efforts are driving business results.

MLC members, you can download the full Social Media Plan on a Page template and get started on your social plan today.

As detailed in our decision simplicity work from last summer, using trusted brand advisors can help build a brand.  These brand advocates help consumers relate to the brand, and they have much more credibility than other branded communications.  This trusted advice, along with helping consumers learn about your brand and weigh their options, simplifies decisions for consumers; these simpler decisions make them more likely to have brand intent, to follow through on that intent, to repurchase, and to recommend the products to their friends.

But many brands struggle with the risk involved when using consumers to market the brand.  After all, giving consumers the license to share their thoughts on your brand allows them to share the bad along with the good.  In addition, it can be hard to select the right people to represent the brand.

Ford tackled these challenges to launch the U.S. model of the Ford Fiesta by using consumer advisors, or “agents.”  To ensure that both consumers and the brand could trust the agents, Ford implemented a rigorous selection process to ensure good brand fit and social media reach.  Ford selected a very diverse group of agents, so most consumers in the Fiesta’s target demographic can find agents like them.

A larger struggle for most brands, though, is giving up control over what the consumer advisors say.  Ford knew it needed to balance the need for some brand control with the need to generate authenticity by giving agents uncensored speech, so they assigned monthly missions to give some structure to the agents’ experiences. Ford then allowed the agents to use their own blogs, tweets, and YouTube channels to tell their stories in their own words, pictures, and videos.

In addition to providing structure for the agents, Ford further leveraged these missions by selecting some that highlighted the car’s features.  For example, one mission had one agent drive until his car ran out of gas, showcasing the car’s high gas mileage; other missions included turning the car into an ice-cream truck (showing off a large amount of trunk and storage space) and taking a road trip (to demonstrate its comfort over long distances).

Using the agents to tell the brand’s story had really positive results: Ford generated the same name awareness for the Fiesta as the Ford Edge and Flex had after two years of traditional advertising at just 10% the cost of a traditional media campaign.

After seeing such great success in the United States, Ford adopted the campaign for India.  MLC members, click here to read about how Ford used the agents to generate brand interest in an emerging market.

Many B2C marketers these days are turning to data and analytics to drive customer-centric outcomes. But the higher you go up in organizations, the more difficult it is to get a true picture of what your customer is like – competing priorities and the abstraction needed to run a very large enterprise run counter to focus on details of the customer experience.

Payless, an American shoe retailer, faced this problem a few years back. Facing competitive threats from big-box discounters, a deteriorating customer experience, and a management team far-removed from the average customer, the company’s CMO tried to drive improvements in the customer experience but predictably failed due to lack of senior management buy-in.

Realizing that the company needed to make the lack of customer focus “real” to senior executives, Marketing arranges a series of executive-immersion sessions. They listen in on focus groups to learn the characteristics of core segments, then “act out” those segments in a series of visits to Payless and competitor stores – a constraint that forces them to remove their functional hats and view stores from the perspective of a consumer, rather than an operations or a finance executive.

A key part of the visits to Payless stores is that they are unannounced and incognito. Executives, assuming their roles as a particular customer persona, shop in the store as any other customer would, avoiding the problem of stores “preparing” for pre-announced visits.

The end result? Executives quickly figured out where the customer experience was lacking and identified a few key elements to fix, leading to higher same-store sales and increased foot traffic and customer satisfaction.

MLC members, check out the full case, or listen to this webinar replay on how companies – including Payless – have pioneered consistent, differenteated, and delightful customer experience.

The US economy might be improving, but business leaders are still walking a tightrope: budget pressures and the increased cost of failure have led to buyers scrutinizing purchases more than ever before – both as individuals and in group buying settings.

Part of this has to do with greater information availability – customers are educating themselves about products and solutions before they ever see a rep, and, as such, are in a better place to make more thorough and deliberate decisions about what they buy. Time pressures have led business leaders to spend less time with reps, as well, reducing the amount of messaging purchasers absorb prior to the buying decision.

But one important element of buyer scrutiny is fear: fear that the solution will fail or not work as advertised, and that their key metrics – or, even worse, their careers – will take the hit. And who can blame them? In today’s networked world, the cost of failure is a lot higher than it once was.

Autodesk, a 3D design, engineering, and entertainment software company, solved the problem using a purpose-built online community that connects credible customers to qualified leads, enabling customers to assuage the risk-oriented fears of the prospects. Using a variety of incentives for existing customers, the online forum enables conversations across customer groups. The best conversations are converted to product messaging – helping bring “social proof” into the company’s marcomm efforts.

MLC members, for more on this solution, check out the full case.

Yesterday afternoon, I watched eMarketer’s recent webinar on measuring social media success.  What particularly caught my eye were the top challenges that marketers face when managing their social media marketing efforts: measuring the ROI, making the case for investment, integration/measurement with other marketing channels, getting the right talent, and deciding who does what.

This list was eerily reminiscent of the results from MLC’s Marketer Quick Poll from a couple of months ago.  Only in our case, we had asked marketers about their top challenges on the data management frontier.  If these challenges are so similar between such different subjects, then perhaps it’s time to reposition and take a step back to look at the broader marketing environment.

The easiest big-picture framework that came to me was the traditional supply-and-demand curves.  For simplicity’s sake, we can consider the consumer market for baby food.

Assume we hold the supply curve constant.  To increase the amount of consumer surplus under the demand curve, we can do one of two things:

1. Try to make our captured demand hug the full consumer demand closer.  (Gerber battles Baby’s Best!)
2. Attempt to shift both demand curves further out along the supply curve.  (Expand the economic pie – for instance: Gerber using analytics to discover that older adults without teeth were an underserved market)

Most marketers would agree that achieving both would be ideal, and if they had to pick, they’d aim for the latter.  But if we look at actual practices, most marketing departments are focusing their social media and analytics efforts in the first one.

Their thought process might go something like this:

Sure I’d like to just burst through the innovation bubble and find a whole new untouched consumer population…

But we don’t have the innovative power, and it certainly won’t be easy justifying riskier, creative ventures to the rest of the organization.

Besides, the consumer landscape is changing so fast, I’m having a hard-enough time just keeping up with my competitors!

So let’s just work on speeding up current activities and getting as much consumer information as possible.  Who knows, maybe we’ll get lucky and come across something that will push innovation forward!

However, while aiming for “real-time” relevance has its merits, it may not be the smartest way to secure customer value and loyalty.  Consider the following: are marginal increases in market share sustainable?  Are consumer preferences really changing so quickly, or does it just seem that way with recent technological/analytical advances?

We’ve recently been thinking that focusing on speed may lead to smaller marketing improvements with fleeting market advantage.   Keep an eye out for our survey in February, when we’ll be gauging Marketing Agility (speed, flexibility, and all the factors that represent entrepreneurial readiness).  Participating companies will get a benchmarking report.  Email me if you’re interested in taking the survey or learning more: yzhang@executiveboard.com

While it’s looking like 2012 might be a better year for business than 2011, it’s still essential that marketers focus on ways to ferret out waste and inefficiency in operations – both to minimize the impact on corporate bottom lines, but also to remain flexible for the new channels and investments that are sure to pop up in the coming 12 months.

And so, we measure everything – campaign effectiveness, brand investments, even the internal operations of the marketing function. But a marketing organization is a complex organism, and can be measured in an infinite number of ways – ways that might be contradictory or misleading.

Unsurprisingly, MLC members have come up with a number of ways to measure marketing’s effectiveness. Here are a few of our most popular strategies:

Measure adherence to the brand promise. Large organizations face inherent difficulties in consistently delivering on ambitious brand promises, and FedEx was no different; performance to brand promise was wildly inconsistent across channels and geographies.

In response, the company created a scorecard that boiled down the brand promise into discrete employee behaviors, incenting the front line to comply in the process. MLC members, read the full case here.

Measure marketing’s contribution to firm financial performance. This one can be difficult to figure out – it’s hard to determine, with any sort of certainty, which marketing activities have led to which performance benchmarks at the corporate level.

Xerox moved to this model after years of throwing large volumes of performance data at senior decision-makers. They used a lean Six Sigma process to arrive at a manageable number of insightful metrics aligned with broader firm performance, leading to higher levels of senior-staff buy-in. MLC members, read the full case here.

Measure marketing’s contribution to firm goals. We highlighted this case in this week’s post on sustainable brand growth, but it also explains a key insight into what Marketing should prioritize when it comes to effectiveness measurement. Given the somewhat ambiguous nature of marketing, it’s key that senior folks buy in – and most often, getting buy-in is contingent upon answering the question “What have you done for me lately?”.

One MLC member solved this problem by creating a purpose-built dashboard that shows exactly how marketing and branding initiatives align with and contribute to corporate goals. MLC members can see the whole case here. We’ve also blogged about this case.

A lot of folks have made New Year’s resolutions to stay more on top of developments in marketing and related fields – I know I have. Obviously, one of the best ways is to keep following this blog; but while you’re not doing that, check out some of these important new books:

Thinking, Fast and Slow. Just when you thought the cognitive-science fad in business circles was wearing out, Nobel winner Daniel Kahneman releases what is likely to be considered his magnum opus on the way people think and make decisions, particularly commercial ones.

In general, I think marketers intellectually know that consumers are not rational and will often make unexpected choices, but our models often assume a rational or quasi-rational consumer. I think that, in some respects, this book will help folks truly re-think what drives commercial behavior.

The Filter Bubble. Here’s one that describes a phenomenon marketers are (in part) responsible for: the splintering of society made possible by long-tail affiliations and the internet, and the resulting “bubble” most people find themselves in when it comes to news, information and products.

This is an important phenomenon that really does limit the kind of serendipity that drives a lot of product adoption and preference switching, and it’s worth looking in-depth at author Eli Pariser’s argument. His examples are primarily from the world of politics, but the parallels are clear: when algorithms and social circles control what one is exposed to, serendipity dies.

Steve Jobs. I’ll be honest – I’ve only just picked this one up, and I’m not quite sure I have well-developed thoughts on what the book has to offer folks. I have read a number of excerpts from the book, around the time it was released – and I can say that they paint a picture of an incredibly enigmatic leader, the kind whom we’re not likely to see again any time soon.

I think, if anything, the big takeaway from this book will be just how reliant Apple was in its early days on Jobs’ genius, and how other companies that compare their innovation and design acumen to Apple’s are likely chasing unicorns.

The Challenger Sale. You know we couldn’t write a post about the best recent business books without plugging our own. Matt Dixon and Brent Adamson, both of our sister program for sales executives, have a great new book out explaining how the relationship sales approach is becoming less effective, and how the best sales reps for the new environment are those that don’t acquiesce to the customer’s every demand, and who push back and remain in control of the sale.

The book teaches executives how to implement a Challenger sales strategy in their organization, and even includes great information on how marketers can help enable Challenger selling. Definitely worth a look.

Banks and other financial companies have long-since taken notice: having a mobile presence is a giant boost to customer satisfaction and retention. How giant? Well, to grab a few anecdotes from a study that our sister program TowerGroup did for Accenture, banks experienced returns of 300% and 270% on their mobile investments, and one European bank experienced annual customer growth rate of 60%, partially due to expanded mobile capabilities. The study that TowerGroup did analyzed 10 banks seen as leaders in the mobile space – notably, only a few were American banks – and, in each, mobile delivered significant returns.

Part of this strikes me as catch-up growth: for awhile, there were significant differences in the mobile offerings between various competing banks, here in the US. Just about any bank of size offers a few standard mobile features: balance check, transfers between same-bank accounts, bill pay – features that more or less mirror the offerings from online banking platforms. Now that the major players in the market have more or less adapted similar mobile platforms, I’d expect that the explosive returns TowerGroup found might not be as common as they once were.

To continue driving results and returns from mobile banking, then, banks are going to have to start getting innovative. I think that answering these two questions are a great place to start: Read More »