Listening to Your Customers In the Digital Age

January 19, 2012

“You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new” – Steve Jobs

What do customers want?

Let’s do a focus group and find out. This tried-and-true approach to innovation leading to brand extensions, new product categories, and new marketing approaches has and continues to be used as a cornerstone of market research efforts.

In an interesting BusinessWeek article dating back to 2005, titled “Shoot the Focus Group”, the author states that although there are plenty of examples and ample evidence that Focus Groups fail time and again, companies keep using them.

“The old-fashioned focus group still has its believers even with fiascoes like Pepsi Edge and a decades-long new-product failure rate of about 90%.” – BusinessWeek

You probably know the famous examples of the failure of Chrysler’s Aztek car and the surprising success of PT Cruiser, Coca Cola’s “New Coke”, Ford Edsel, and plenty of others horror stories of focus groups gone wrong.

And why is that? I like Gerald Zaltman’s explanation that “The correlation between stated intent and actual behavior is usually low and negative” which also reminds me of an episode of Mad Men where Don Draper chastises a hired researcher to do a focus group for one of their clients, see below.

Excerpt from Mad Men, Season 4. “The Rejected”.

Faye: Well, I’ve done everything but finish the report.

Don: How’d we do?

Faye: Well, it turns out the hypothesis was rejected. I’d recommend a strategy that links pond’s cold cream to matrimony– a veiled promise.

Don: Hello, 1925. I’m not gonna do that, so what are we gonna tell the client?

Faye: I can’t change the truth.

Don: How do you know that’s the truth? A new idea is something they don’t know yet, so of course it’s not gonna come up as an option. Put my campaign on tv for a year, then hold your group again, maybe it’ll show up.

Faye: Well, I tried everything. I said “routine”, I tried “ritual”… all they care about is a husband. You were there. I’ll show you the transcripts.

Don: You can’t tell how people are going to behave based on how they have behaved.

So, what’s the problem with focus groups?

In a Harvard Business Review article, Turn Customer Input into Innovation, Anthony Ulwick says “companies go about listening to customers all wrong”. Customers are asked to offer a solution to a problem but they aren’t informed enough, aren’t experts in the field and have a limited frame of reference.

“The problem, when there is one, is simple: Companies ask their customers what they want.” – Anthony Ulwick

The solution, according to Ulwick, is to focus on outcomes. This means that instead of asking for customers to submit solutions to a particular problem, they should focus on understanding what customers value most.

Leveraging Social Media for Market Research

But how about using social media? I strongly believe that traditional marketing tactics can be greatly enhanced by using digital tools and when it comes to market research, social media channels should be top of mind. That includes paying attention to comments on your blog, using your Facebook Fan Base to test new ideas, monitoring Twitter feeds, and more.

“I’ll take the status update that someone wrote from the couch in the comfort of their own home as more accurate than the comment they made in a focus group room when they are given a $100 gift card to show up.” – Mike Volpe, CMO at HubSpot

Whether social media will replace traditional market research is up to debate, the active use of social media to complement market research can dramatically improve a company’s success ratio for new product launches and maybe take away some of that bad rap focus groups have.

Additional Reading

Here are some interesting articles if you’d like to dig deeper into this topic:

Note: Mad Men is Copyright of American Movie Classics Company LLC.

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Aberdeen Shows How to Do Email Marketing Right

January 13, 2011

The new research report from Aberdeen Group “Email Marketing: Customers Take it Personallyhas some very interesting insights. They talk about how the increase in the number of available marketing channels coupled with the resource constraints of most marketing organizations is the toughest challenge for marketers to overcome. If you have just started your 2011 campaigns after battling the budget process, I bet you can definitely see some relation to your own company.

So with all these new channels available, why does email marketing continue to be a top choice for marketers everywhere? According to the research “email marketing’s ability to provide a high quantity of leads combined with direct revenue gains” is what makes it still an attractive channel. Even when compared with social media, the research states:

“83% of all companies surveyed indicate they will leverage email as a core tool in the marketing mix and at a rate 54% more than social media despite that channel’s growth and popularity”

This is definitely contrary to a lot of the predictions of email marketing’s death and the rise of social media as the main communications channel for marketing that we heard throughout 2010.

In their research they also classify companies according to their results in email marketing usage. The leaders of the pack, called Best-in-Class companies, follow some best practices you can also adopt at your own organization:

  • Remove opt-out members from database
  • Remove hard and soft bounce recipients from the database through email authentication
  • Deliver special offers to high value customers
  • Integrate nurturing of existing leads with campaign results
  • Have an organization structure that supports data capture and sharing
  • Measure the impact of email marketing optimization practices and changes
  • Share the activity history of an existing or net-new lead with sales team

And, they add that the real key critical factor is the personalization of content in your emails. They say that “companies that marry high value customers with personalized, specialized offers in their email campaigns produce far greater results on every tangible measure of effectiveness”. Content personalization is not an easy task but according to the research it will likely give you a 38% better open rate and 86% greater click-through rate than non-personalized email messages.

The lesson? Work your way through the list above and start playing with content personalization, even if only for a small segment of your database. It will likely pay off handsomely.

The report has more interesting stuff and  I suggest you spend a few minutes reading it. You can get it for free for a limited time here:

http://bit.ly/fxiUoz

 


Marketers Listen Up: How to sharpen your social media skills

December 22, 2009

Listen before joining social media

Pressured to join the social media scene and start tweet-link-face-blogging? Hold on a minute, because first you may want to read what some experts have to say.

In one word: LISTEN.

Before letting everyone know you’re there and that your company or product is great, find out if people will care and, more importantly, find out how to engage them so that in the future they may care. Not wanting to rehash what has already been expertly written, here are some great starting points:

  1. The Six Free Listening Tools You Cannot Do Without, from Debra Askanase, is a great compilation of free tools that can get you started. Also, worth checking out is her recent post on “the case of 4,000 indifferent twitter followers“.
  2. Another good list of tools to use for listening into social media sites is given by Clay McDaniel on this MarketingProfs article.
  3. But before you go after all the shiny new tools, make sure you ask yourself the Five W’s of Social Media Listening, courtesy of Jason Falls.

There are countless other sources on the web, but I thought these are a very good summary of the basics. If you have come across other great tools or advice, please share!


Magic Quadrant or Magic Numbers? A Judge Will Decide.

October 21, 2009

Gartner Group is known in the technology industry as a heavyweight analyst group that influences a lot of purchasing decisions. Big companies all turn to Gartner’s reports to help them on emerging trends and technologies. Software vendors like to boast when they are placed in a specific position on Gartner’s famous Magic Quadrant report. The Magic Quadrant (MQ) report has been around for years and is used to showcase key players in a certain industry, comparing them and ranking them against a set of criteria.

Gartner's Magic Quadrant is now on trial

Gartner's Magic Quadrant is now on trial

The problem? Gartner’s MQs have long been seen with suspicion by industry veterans and no matter what industry is showcased, it has always raised questions about why certain vendors were not included and why their view of the market is so different (like here about the DataWarehouse MQ,  here about the WCM MQ, and here when it tackled Cloud Computing just to name a few). Gartner analysts try as they might to correct what they see as misunderstandings again and again are facing an uphill battle.

That’s why I was not surprised when I read on Dave Kellogg’s blog that ZL Technologies is suing Gartner over the MQ. Is an interesting lawsuit because it brings up the question of whether these vendor reports can really help or hinder a company’s ability to grow. And it will help stir some debate about the usefulness of such reports to consumers in general and how relevant the reports are. From what some vendors say, depending on your space the analyst report won’t help you at all. Stay tuned!


Are You Paid Enough? New Salary Survey Released

August 14, 2009

We all like to complain about how much we make, so here’s another reason for you to either shut up or have that awkward conversation with your boss about getting a raise. Exhibitor Magazine’s July Edition showcases their annual salary survey with interesting results.

You can see the results online on their website, but here’s a summary of average salary for selected titles:

  • Advertising and Marketing Managers: $61,451
  • Communications Manager: $72,606
  • Corporate Event Manager: $66,581
  • Marketing Communications Manager: $67,852
  • Marketing Director: $75,870

Some interesting findings from the survey are:

  • Women earn on average $13,134 less than their male counterparts
  • 70% of respondents said they are happy with their current jobs
  • Those with industry certifications enjoy an average of 18% higher salaries than their non-certified peers
  • 94% of respondents reported working more than 40 hours per week, which is not very surprising but they slice this number based on pay level and find that those who earn more than $80K put in 60 hour or more per week than those earning around $57K who work 40 to 49 hours per week

The survey also breaks down salaries by industry and region, so it is worth checking it out and comparing your own salary with the results. This is also a good resource for ensuring your staff is being compensated according to the market and for negotiating salary with someone you are hiring.

Other sources for salary comparison can be found at:

And I would be negligent not to mention the always thought-provoking posts from Seth Godin, this time about the myth of big salaries. Although his criticism was towards Wall Street financial companies that complain they need hefty compensation packages to attract talented employees, you decide whether it applies to your company as well.

Happy salary negotiation! 😉


Only One Thing Matters in Online Surveys – WIIFM

February 16, 2009

Marketers have several tools at their disposal in their arsenal of marketing weapons, one of which is surveys. You can’t be a marketer without having done some surveys in your life, otherwise where will you have gotten  your data from? How did you target and fine tune your messages?

With the advent of cheap online survey software, everyone it seems is creating and sending out surveys. The good surveys, or should I say effective surveys, are the ones that get people to fill them out giving you enough insight into their market/purchasing process/buying habits/etc. that will positively affect your campaigns.

Marketing guru Seth Godin has recently posted a short but very good list of how you can make better surveys, but he misses one very important point. WIIFM (What’s In It For Me?). That’s what the reader will be asking herself as she reads and opens your survey.

The benefit to the survey respondent needs to be obvious. Sure, in some cases people may respond simply because they love your company/brand and that’s great, but you should also strive to get those who are not necessarily loyal customers to respond, otherwise the survey may end up not telling you the whole truth. What will they get out of it? There are several options:

  • Prize drawing (like an iPhone or other gear)
  • Cash (or gift cards)
  • Book
  • T-Shirts and other corporate branded giveaways
  • Knowledge

Of all the possible offers, Knowledge is probably the most enticing. Sure, if you give away a brand new tech toy people will likely get excited about the possibility of winning it, but if you give away Knowledge you will have an even better chance of impressing the respondent. This knowledge can come up in several different ways, such as a compilation of the survey results, a more personalized benchmark of your questions versus the survey population, a whitepaper about the subject at hand, and many others. Few people do it this way because it takes time and money.

Regardless of what you are offering (and the offer should vary based on your target population for the survey, your industry, etc.) you will be far more successful if you think in terms of WIIFM – make it attractive enough that they will want to spend a few minutes answering your questions.


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