Customer Loyalty

More consumers are switching brands than ever before.  54% of consumers globally say they are more likely to try new brands than they were 5 years ago and 30-40% engage in recessionary behaviors (e.g., searching for deals, using coupons) even more than they did during the recession.  These behaviors are being enabled by new technologies—such as mobile search, social buying, and price comparison apps—that give consumers easier access to choice and information.

To keep consumers’ attention despite all these distractions, many brands seek to boost brand engagement. They aim to stay top of mind by building “personal” relationships with consumers via Facebook or interacting more frequently with them via email newsletters or mobile alerts, for example.

However, MLC’s 2011 study for B2C brands, including a survey of 7,000+ consumers (in the U.S., U.K., and A.P.A.C) found that engagement isn’t the best way to win shoppers over.  In fact, in many cases engagement efforts don’t help at all.  Frequency of interactions (i.e., email newsletters, mobile alerts) has no significant impact on loyalty (i.e., intent to purchase, purchase, repurchase, recommendation).  Strength of relationship with a brand does improve loyalty, but few consumers (typically, just 1 in 5) are open to brand ‘relationships’. Read More »

Marketers and technology have a long and tortured relationship filled with both good times and bad.  It seems every few years (or sometimes months) there is a new tech-based trend that has big implications for how Marketing interfaces with consumers and customers (websites, social media, mobile) and how it manages its pipeline (Customer Relationship Management (CRM) Systems – first in software form, now “in the cloud”).

The latest tech trend that is generating a lot of buzz among marketers is “marketing automation.”  For the uninitiated, in the B2B world, marketing automation is the umbrella name given to the software and other technology tools that allow marketers to systematize and mechanize tasks like lead generation, lead nurturing, and lead qualification.  It can be as simple as automatically sending out a segment-focused monthly newsletter to a list of prospects and current customers and as sophisticated as an algorithmic model that segments, targets, and scores potential leads based on a combination of tracked web behaviors and information collected through web-forms. Read More »

Last week, The Economist ran a thought provoking piece on the future of news.  As I read it, I was struck by the parallels to some consumer goods and services categories, like apparel, quick service restaurants, electronics and even some kinds of fast moving consumer goods.

If you believe that what is happening to the news industry may be playing out in these other industries, marketers should be fundamentally reconsidering the role of brands and therefore the way they do branding.

To boil down the Economist’s 14 page report on the news industry into six bullets: Read More »

By Ana Lapter

CEB’s April 2011 Business Barometer Survey indicates cautious optimism among business executives regarding economic growth prospects: 75% of business executives expect their firm’s revenues to increase, in most cases, by at least 5%.  This positive feeling about top line growth is marred by anxiety about higher cost pressure, as 72% of executives expect cost pressure to increase in the next 12 months.

Strong growth prospects are good news for marketers, particularly when the source of new revenues emanate from new product development. The CEB data indicates that 53% of executives expect to introduce a higher number of new products within the next calendar year.  The pressure on cutting costs, however, will most likely involve closer budgeting scrutiny on marketing strategies for product launch.

Due to the high media and advertising investments associated with new products launches, marketers look at brand extension as a relatively low cost strategy to extend the benefits of current brand recognition and goodwill to new products.  The popularity of a brand extension strategy stems from its ability to both reduce communication costs and drive better consumer acceptance of new product. This strategy, however, can be risky. Poor planning can damage the parent brand and lead to market rejection of the new product.

So how can marketers successfully extend their brands to cover new products? Consider these tips: Read More »

“To do a Domino’s”: To admit your mistakes and take steps to amend.

“Doing a Domino’s” entered the vernacular following Domino’s self-critical 2010 campaign, which acknowledged that its pizza “taste[d] like cardboard” and promised to improve the taste.

Domino’s mea culpa coincided with a 14% revenue boost, a 10+ percentage point increase in taste perceptions, a 613% growth in Facebook fans, and a 83% share price increase.

Could admitting your failings do the same thing for you?  MLC’s 2011 research on purchase drivers suggests so. Read More »

My colleague Anna spent the second half of last week at the Association of National Advertiser’s annual conference, and reports back that much of the talk of social media metrics at the meeting focused on raw volumetrics: Facebook fans achieved, Twitter followers accrued, clicks on that link, time on site for this one. In short, traditional metrics of social media “engagement” still hold a lot of sway among marketers seeking to evaluate their social campaigns relative to others.

And why not? Friends and followers are the simplest social media metric we have available to us, and the one that’s most likely to track real-world engagement with a brand’s online presence. In the presence of other pros who speak the social language, they’re an easy way to benchmark a campaign’s performance.

But out in the broader business world, we’re hearing that senior executives, especially ones without social backgrounds, are finding it hard to contextualize friend/follower metrics in a way that links back to business results. Former H&R Block social media ringmaster Zena Weist explains to us the limitations of traditional social metrics:

Read More »

By Ana Lapter

Several months back, we conducted a comprehensive customer survey trying to uncover changes in B2B buying behavior.  By now, you have probably heard me and my MLC colleagues mention the 57% multiple times – this is the degree to which the buying process is completed before customers decide to engage with Sales reps.  We interpret this number as both a delay in the sales engagement point and as a big red flag for marketing organizations.

Due to availability of online information, customers are doing more research on their own and can form significant opinions of their purchasing needs without help from vendors.  This independent research behavior coupled with the fact that recessionary aftershocks are still haunting buying centers, can lead to: 1) customers adding pressure on vendors to lower price and deal size; 2) “commoditization” of solutions; and, 3) more stalled deals. Read More »

That was the opinion of at least one attendee at the MLC’s Shopper Marketing cohort session (check out the presentation here) held on June 29 at the Newell-Rubbermaid offices.  More than 30 marketers gathered for the day to talk about the current state of shopper marketing.  The overall consensus was that the importance of the shopper function has never been more important.  Here’s why: Read More »

As the recession has (hopefully!) begun to wane a bit, and marcomm budgets are growing again, we’re finding that many members are either re-establishing relationships with agencies they had to cut in the downturn, or finding new agencies to pick up the slack. We figured it was worth taking a trip through our findings on agency relationships to re-introduce folks to the best practices of our network in terms of finding great partner agencies, structuring their work within the broader organization, and evaluating/compensating them according to their results.

Here are five ideas for getting the most out of your agency partnerships – you can find more here: Read More »

To make marketing efforts more trusted, brands typically turn to consumer recommendations. That’s the right move, since a brand’s own information will never appear as objective as an outsider’s viewpoint. The problem is, consumer recommendations are often too vague to convince today’s anxious shoppers to buy.

Instead of targeting recommenders, brands should be targeting advisors: consumers who teach other shoppers when, why, and how to buy. While recommenders focus on features and benefits and only discuss positive points, advisors cover both pros and cons and also share information about the best usage occasions and retailers. This extra detail makes their suggestions far more persuasive and helpful. The chart below outlines the key differences between recommenders and advisors.

There are two challenges with harnessing consumer advisors:

1. How to find consumers who will make good advisors (not just good recommenders)
2. How to teach consumers to provide better advice

Intuit’s Quicken Software group has done some good work on both fronts. First, they have a thorough ambassador screening process that ensures selected consumers are both genuine brand lovers and also credible sources of information. MLC members, see their screening questions here.

Second, they don’t just do research to understand what kinds of advice shoppers’ need. They also interview advisors to understand barriers to advice-giving, e.g., it’s hard to bring up the topic of personal finance. Based on the findings from this research, they create a toolkit of educational materials and incentives that target ambassadors’ top concerns. MLC members, see their research and targeted ambassador toolkit here.