Sunday, August 19, 2018

Strategic and Agile Marketing - Better Together

Earlier this summer, Samuel Scott created quite a stir when he wrote an article for The Drum arguing that agile marketing is a "crutch for those who do not have a real strategy."

Samuel made several points in his article, but his primary argument was that most marketing channels and tactics do not and should not change all that frequently. Therefore, an agile marketing methodology is both unnecessary and inappropriate for many marketing activities. He contended that "strategy is paramount" and that many agile marketing ideas are "nothing but myopic short-termism."

Samuel wrote:  "But brands that insist on being 'agile' and changing short-term tactics all the time will only lose money . . . Say that you do 'agile marketing' and test various tactics and channels all the time. If it takes several months to determine what works best, it will have wasted time and money. A good strategy would have determined what to do at the beginning."

Scott Brinker responded to Samuel's article in a post at his Chief Marketing Technologist Blog. In his post, Scott argued that agile marketing - when done properly - is an instrument of strategy, not a replacement for strategy.

Scott described the basic rationale for agile marketing as follows:

"Agile management is a way to execute a strategy when either (a) the environment in which you're operating is fluid and shifting, and you want to rapidly sense and respond to those changes, or (b) the media in which you're rendering your strategy is malleable and has fast feedback loops . . . giving you the valuable option to iteratively optimize your execution quickly and cheaply."

He contended that "when agile methods are connected to and governed by a clear strategy, agile optimizes the operational reality of that strategy beautifully."

Frankly, I haven't seen much evidence that marketers believe the adoption of agile marketing eliminates the need for a sound marketing strategy. The idea that agile marketing makes marketing strategy unnecessary reflects a fundamental misunderstanding of what agile marketing is about.

At the most basic and practical level, agile marketing is about organizing and managing the work activities of marketing personnel and teams. As Andrea Fryrear, the President of AgileSherpas, recently put it, "Agile marketing is the deliberate, long-term application of a specific Agile methodology to manage and improve the way a marketing team gets work done."

This focus on improving the way marketing work "gets done" can be seen in the results of the 1st Annual State of Agile Marketing Report published earlier this year by AgileSherpas and Kapost. In this study, survey participants were asked to identify the most important reasons for adopting Agile in their marketing department. The following table shows the top five reasons selected by survey respondents:

Notice that most of these top reasons relate to improving the productivity of marketing work.

Study participants were also asked to identify the benefits their marketing department had realized from using agile marketing. The following table shows the top five benefits selected by survey respondents:

Again, most of the top benefits identified by the survey respondents relate to the improvement of work activities and processes.

Marketing success in today's complex business environment requires both a sound marketing strategy and agile marketing operations. But maintaining a high level of strategic alignment while simultaneously providing front-line marketing teams the necessary flexibility to adapt and respond quickly to rapidly changing market conditions can be a daunting challenge for marketing leaders. In a future post, I'll describe an effective way to meet this challenge.

Top image courtesy of velkr0 via Flickr CC.

Sunday, August 12, 2018

Written Content Still Matters in B2B Marketing

Unless you've been completely off the grid for the past several years, you're well aware that the popularity of video content has exploded. eMarketer recently estimated that U.S. adults now spend over an hour per day watching videos on digital devices. Omnicore has reported that in early 2018, YouTube had 1.57 billion monthly active users who watched over 5 billion videos every day.

Video Marketing is Mainstream

Research shows that marketers have embraced the use of video content. In a 2017 survey by Wyzowl, 81% of marketers said they were using video as a marketing tool, and two-thirds (65%) of the marketers who weren't already using video said they intended to start using it this year. In the 2018 content marketing survey by the Content Marketing Institute and MarketingProfs, 72% of B2B marketers said they are using video for content marketing purposes.

Given the widespread popularity of video content, some B2B marketers may be tempted to conclude that video is the future of marketing content, and that written content has lost much of its effectiveness. That would be a mistake, and here's why.

Written Content Still Matters

The reality is, written content remains a highly effective B2B marketing tool, and numerous studies have shown that a large majority of B2B buyers still prefer written content for many purposes. For example, in a recent survey of business executives by Grist, the three most preferred content formats were:

  1. Short articles (800 words)
  2. Blog posts (300-500 words)
  3. Feature articles (1,200+ words)
Twenty-eight percent of the respondents in this survey also indicated a preference for long-form written content such as white papers, research reports, and ebooks. Only 26% of the respondents said they prefer video content.
In the 2018 content preferences survey by Demand Gen Report, survey participants were asked to select the types of content they find most valuable during the early, mid, and late stages of the buying process. Across all three stages, respondents identified thirteen types of valuable content, and all but three were text-based formats.
The Psychology of Content Preference
Basic principles of human psychology explain why we find video content so appealing and also why we prefer written content in many circumstances. Psychologists say the human brain processes visual information about 60,000 times faster than textual information. Therefore, watching videos requires little cognitive effort.
Reading, on the other hand, requires the brain to expend more cognitive energy. When we read, our brains must actively create thoughts about the content. It requires the production of an "inner voice" that enhances our attention. So, reading requires a longer attention span and more brainpower than watching a video.
Human beings are hardwired to avoid cognitive strain, and this means we are predisposed to prefer information that's easy to process. This is one reason we find video content so appealing.
But our mental "laziness" only creates a predisposition, not a hard and fast rule. In some circumstances, people will prefer information in a form that requires a considerable amount of cognitive energy to process. This explains why B2B buyers still prefer written content even though it requires more mental energy to consume. 
The key for B2B marketers is to understand when and why a potential buyer will sometimes find video content appealing, and at other times will favor written content.
Written Content Appeals to Goal-Oriented Buyers
The preference for video or text-based content is greatly influenced by what a potential buyer is trying to accomplish. Some buyers encounter content when they are focused on achieving a specific goal by consuming the content. Others encounter content when they don't have a specific goal in mind. They may be mildly interested in a topic, but they don't have a pressing need to learn about it in detail.
A recent analysis of website viewing behavior by Clicktale found that goal-oriented visitors tend to prefer text-based content, while less-focused "browsers" are more attracted to videos and colorful images.
This means that video content may be more effective with potential buyers who are not in an active buying process and those who are engaged in what I have called casual learning. However, text-based content is likely to be more effective with potential buyers who are focused on learning about a business issue or challenge and possible solutions.
Most goal-oriented buyers prefer text-based content because it is more suitable than video content for addressing complex topics and communicating detailed or technical information. This is an important consideration for B2B marketers since many B2B products and services are complex offerings.
Goal-oriented buyers also tend to prefer text-based content because it enables them to easily control their interaction with the content. Buyers can skim over portions that don't interest them, stop reading to make notes, and go back to re-read portions that are particularly interesting or require additional attention to absorb. With written content, potential buyers can interact with the content at their own pace.
Bottom Line
The bottom line is that both video and written content are important for B2B marketing success. Video content can be a powerful tool for capturing the attention of potential buyers, while written content excels at meeting the needs and preferences of more focused, goal-oriented buyers.

Image courtesy of Mehmet Pinarci via Flickr CC.

Sunday, August 5, 2018

The Right (and Wrong) Way to Listen to Customers

"If I had asked my customers what they wanted, they would have said a faster horse."
Henry Ford (Attributed)

"We don't ask consumers what they want. They don't know. Instead we apply our brain power to what they need, and will want, and make sure we're there, ready."
Akio Morita, Co-Founder of Sony

Dozens of books and articles have been written about the importance of listening to customers. Providing great customer experiences has become a top strategic priority for many companies, and listening to the "voice of the customer" is widely seen as an essential ingredient in the recipe for customer experience success.
Marketing often has the primary responsibility for gathering, analyzing, and developing actionable insights from customer inputs. So it's important for marketers to understand that listening to customers in the right way is undeniably valuable, while listening in the wrong ways or for the wrong reasons is a bad idea.
Companies frequently seek customer input in order to design and develop products or services that will be attractive in a given market. However, many companies still struggle to launch new solutions that gain traction with potential buyers. Of course, a new product or service can fail because a company hasn't listened enough to its customers. But failures also occur because companies listen to customers in the wrong ways.
In a common scenario, companies ask their customers what they want and encourage them to describe specific product or service features that would be desirable. The problem is, most customers aren't well suited to perform this task.

Most customers have a limited frame of reference. Like all humans, most of what they know is based on their past experiences. This means that customers can usually do a good job of describing what they want when they're asked about familiar products or services. But when they're asked to imagine or describe new product or service features or capabilities, their input isn't as helpful.

The cause of the problem is a cognitive bias that psychologists call functional fixedness. This bias refers to the natural human tendency to perceive objects only in terms of their typical or normal functions. Functional fixedness can be useful in everyday life, but it can also stifle creative thinking and prevent people from seeing alternative solutions to problems.

Functional fixedness causes people to fixate on the features and attributes that a product usually possesses, and this makes it difficult for them to imagine what new features or capabilities would make a product or service more useful and valuable. In short, most customers have difficulty describing product or service features or capabilities they've never experienced.

As a result, they often describe features or functions that will offer only modest or incremental improvements over whatever already exists. When a company relies solely on this type of input, it can miss opportunities to develop breakthrough innovations that customers would find extremely attractive.

The key to listening to customers the right way is to shift the focus from specific product or service features or functionality to what customers are trying to accomplish - to the "jobs" they are trying to get done. Customers may not be particularly adept at describing specific solutions, but with a little encouragement, they can usually provide a good description of what they are trying to accomplish and what problems or frustrations they are facing.

Focusing customer input on desired outcomes enables you to better understand what customers will really value, and this helps you design solutions that customers will be anxious to buy. So by all means, don't stop listening to your customers. Just be sure you are listening in the right way.

Image courtesy of frontriver via Flickr CC.

Sunday, July 29, 2018

Original Research Powers Compelling Thought Leadership

It's now clear that thought leadership content is having a major impact on B2B buying decisions. Several recent studies have confirmed that business buyers are consuming more thought leadership content, and that thought leadership affects decisions at every stage of the buying process. However, many of the same studies have also found that business buyers are becoming more selective about the thought leadership content they consume.

The reality is, thought leadership is a classic double-edged sword. Great thought leadership makes a significant positive impact on potential buyers, but poor thought leadership can have a major negative impact on a company's demand generation performance. In a recent survey by Edelman and LinkedIn, over a third of C-level respondents (35%) said that a company's poor thought leadership content had directly led them not to do business with the company.

Thought leadership marketing is challenging because buyers have high standards for thought leadership content. In a survey by The Economist Group, business executives were asked why they consume thought leadership content. The top reason chosen was to encounter thoughts that go beyond current thinking. When the executives were asked what qualities make thought leadership compelling, the most popular attributes identified were innovative, big picture, transformative, and credible.

In a recent survey by Grist, senior executives were asked what qualities were most valuable in thought leadership content. The three most favored attributes identified by survey respondents were fresh thinking, forward-thinking, and evidence-led.

These high buyer standards mean that effective thought leadership content must provide buyers with information and insights that they cannot get from other sources. But developing such content on a consistent basis is challenging for most companies.

One of the most potent and reliable sources for compelling thought leadership content is original research, and a new study by Buzzsumo and Mantis Research indicates that original research is becoming an integral part of the marketing mix at many B2B companies.

This study consisted of a global survey that produced 698 responses from marketers. More than half of the respondents (53%) were affiliated with B2B companies, and another 26% worked for hybrid B2B/B2C companies. The focus of this survey was to understand how companies are developing and using original research in their marketing efforts.

In this study, nearly half of the respondents (47%) said their marketing team had created and published original research in the previous twelve months. The study also found that B2B marketers were significantly more likely to have used original research than B2C marketers (50% vs. 35%).

Most of the respondents who had used original research were satisfied with the results. Over half (56%) said their research had met or exceeded most or all of their expectations. Given this level of satisfaction, it's not surprising that nine out of ten of the respondents who are using research plan to conduct additional research in the coming twelve months.

The Buzzsumo/Mantis Research study also suggests that the use of original research is poised to increase. Half of the survey respondents who are not currently using original research said they are considering adding original research to their marketing efforts in the coming twelve months.

Finally, large majorities of the survey respondents in this study indicated that original research provides important support for their content marketing programs. Seventy percent of the respondents said that original research produces more content/editorial ideas, and 67% said it produces higher quality content/editorial ideas.

When reviewing any survey, it's important to consider how the demographics of the respondents may affect the survey results. In the Buzzsumo/Mantis Research survey, nearly two-thirds of the respondents (65%) worked for advertising or marketing agencies, technology companies, and professional services/consulting firms.

In my experience, these types of organizations tend to be relatively heavy users of original research. Therefore, this survey may somewhat overstate the use of original research in the overall population of companies. That being said, there's no doubt that original research is becoming increasingly important as source material for compelling thought leadership content.

Image courtesy of Thomas Haynie ( via Flickr CC.

Sunday, July 22, 2018

What Abraham Maslow Can Teach Us About Customer Experience

In 1943, the psychiatrist Abraham Maslow introduced a theory of human motivation which proposed that people are motivated to satisfy several needs, and that some of those needs take precedence over others.

Maslow argued that human needs are arranged in a hierarchy, with basic physiological needs (food, water, etc.) at the lowest level, and self-actualization at the highest. The hierarchy of needs is usually depicted as a pyramid like the one shown above. Maslow contended that people must satisfy lower level needs before they will be motivated to satisfy the needs on the next higher level of the hierarchy.

Maslow's hierarchy of needs has been widely used in the social sciences and in business to conceptualize important principles, and a version of the hierarchy can provide an effective framework for describing and organizing the building blocks of B2B customer experience.

The following diagram depicts the six factors that collectively define an exceptional experience for B2B customers. Each element in the diagram is a type of need, or an outcome, or a condition that most B2B customers want to satisfy, achieve, or experience in their relationship with a vendor.

These factors or elements of customer experience are fairly self-explanatory, but here's a brief description of each.

Functional quality/performance - The vendor's products or services provide the expected level of functional benefits and exhibit a high level of reliability.

Economic impact - The vendor's solution was (or can be) purchased at a reasonable price. The solution has an acceptable total cost of ownership and delivers an acceptable return on investment.

Ease of doing business - This element encompasses the functional aspects of the customer-vendor relationship. It includes attributes such as convenience and vendor responsiveness.

Trustworthiness - Information provided by the vendor is accurate and reliable, and the vendor consistently keeps its promises and fulfills its commitments. In addition, the vendor consistently puts the customer's interests ahead of (or on par with) its own.

Strategic insight - The vendor regularly provides insights that help the customer address major strategic challenges, sharpen its competitive differentiation, and/or identify new growth opportunities.

Personal value - Personal value refers to the benefits that are experienced by the individuals who are/were involved in the initial purchase of the vendor's solution and those who will make or influence the decision to continue the relationship with the vendor. Some of the most important personal value benefits are enhanced self-esteem and professional reputation.

As the diagram indicates, these customer experience needs are arranged in a hierarchy, but as with Maslow's model, the hierarchy is not based on the absolute importance of the needs. Instead, the hierarchy describes the sequence in which customers focus on and prioritize each type of need. As a general rule, customers will focus first on the needs at the bottom of the hierarchy. Once those lower level needs have been met, their attention will shift to the need in the next higher level of the hierarchy.

The hierarchy reflects the natural and common-sense way that most customers think about their experiences with a company, product, or service. For example, when customers first encounter a product or service, their attention will be on functional performance and economic impact. Once customers have determined that the product or service is providing an acceptable level of functional and economic performance, they will focus more on whether the vendor is easy to do business with.

It's important for marketing and customer experience leaders to understand that lower level customer experience needs don't disappear once they have been initially satisfied. They must continue to be satisfied, or they will again become customers' primary focus.

If, for example, a competitor significantly improves the functional performance of its product, customers may quickly decide that the performance of your product is no longer satisfactory. Therefore, it's critical to constantly monitor your performance against all of the customer experience needs in the hierarchy.

Top image courtesy of FireflySixtySeven via Wikipedia (CC BY-SA 4.0).

Sunday, July 15, 2018

How Customers Really Feel About Personalization

Over the past several weeks, I've published posts that reviewed the major findings of two recent research studies - one by Dynamic Yield, and one by Researchscape International - that focused on the current state of personalization in marketing. These studies were based on surveys of marketing professionals, so they captured the perspectives of individuals who are on the "selling side" of the personalization equation.

For obvious reasons, it's important for marketers to understand how customers and prospects view the use of personalization, and two other recent studies address this critical issue.

The Periscope By McKinsey Study

Periscope By McKinsey is a unit of McKinsey & Company that provides a suite of marketing and sales analytics software. Consumers Value Personalization - Up Your Game to not Miss the Opportunity was based on a survey of 2,500 consumers located in the United States, France, Germany, and the UK.

In all four of the markets included in the study, more than 50% of the survey respondents said they frequently receive personalized messages. However, the markets differed in terms of how much consumers like receiving personalized communications. Fifty percent of the U.S. respondents said they really or somewhat like receiving personalized messages. French, UK, and German respondents were less enthusiastic, with only 38%, 37%, and 29%, respectively, feeling somewhat or very favorable toward personalized messages.

Attitudes toward personalization also varied by gender and age. For example:
  • In the U.S. and Germany, men feel more positively than women about receiving personalized messages, but the opposite is true in France and the UK.
  • Overall, younger consumers feel more positively than older consumers about receiving personalized communications.
The Periscope By McKinsey study also revealed that companies have a long way to go to get personalization consistently right. Overall, about 40% of survey respondents said they only sometimes receive personalized messages that truly feel personal, relevant, and intriguing. In addition, the number of respondents who said that personalized messages rarely or never feel truly personal exceeded the number of respondents who said they usually or often do.

The Accenture Interactive Study

Accenture Interactive has also published the results of a recent study about how consumers view personalization. The 2018 Personalization Pulse Check study consisted of a survey of 8,000 consumers from North America and Europe.

The Accenture research confirmed the potential impact of personalized marketing. Nearly all of the surveyed consumers (91%) said they are more likely to shop with brands that recognize, remember, and provide them with relevant offers and recommendations. Moreover, about eight out of ten of the survey respondents (83%) said they are willing to share their data to enable personalized experiences, so long as companies are transparent about how they use the data and give consumers control over it.

One important concern about personalized marketing is that it can feel invasive or "creepy." The Accenture study found that this problem doesn't occur frequently. Seventy-three percent of the surveyed consumers said that a business had never communicated with them online in a way that felt invasive.

Survey participants were also clear about what triggers the "creepy" factor. Of the 27% of respondents who reported having a brand experience that felt invasive, about two-thirds (64%) said it was because the brand had information about them that they had not knowingly shared with the brand directly.

The study report explains why this triggers such a strong response from consumers:  "Brand and consumer relationships are no different than their real-life counterparts. When one party goes outside of the relationship for information, the level of trust is completely broken."

Finally, the Accenture study demonstrates that companies should be especially careful when using location data to personalize messages. When Accenture asked survey participants how creepy they found certain types of personalized marketing, 41% said it felt creepy when they received a text from a brand as they walked by a physical store, and 40% said it felt creepy when they got a mobile notification after walking by a store.

The Bottom Line

Taken together, these two studies make three important points about personalization. First, most consumers like and want personalized messages, and when it's done correctly, personalization is a power marketing tool. Second, creating messages and offers that feel truly personal and relevant to potential buyers is hard, and most companies have more work to do to get this right. And third, companies must be particularly careful not to violate buyer trust when using personalized marketing.

Illustration courtesy of Phil Wolff via Flickr CC.

Sunday, July 8, 2018

Where B2B Companies Stand With Marketing Measurement

Measuring marketing performance is both a top priority and a persistent challenge for most B2B marketers. That's the primary theme of Demand Gen Report's 2018 Marketing Measurement and Attribution Benchmark Survey. The 2018 survey produced responses from 283 marketing executives, most of whom were based in the United States. Respondents represented several industries and a wide range of company sizes (from less than $10 million to more than $1 billion in annual revenue).

Eighty-seven percent of the survey respondents said that marketing measurement is a growing priority for their company. However, more than half of the respondents (54%) said their ability to measure and analyze marketing performance "needs improvement" or is "poor/inadequate." Another 34% rated their measurement capabilities as just "average."

It also appears that progress on measurement capabilities has been slow since last year. The following table shows how respondents rated their measurement capabilities in the 2018 survey and in the 2017 edition of the study. As the table shows, the percentage of respondents rating their capabilities as excellent decreased from 13% to 7%, while the percentage rating their capabilities as poor/inadequate increased from 9% to 14%.

It's not hard to understand why measuring the financial performance of marketing continues to be a major challenge. In most companies, the two most important reasons to measure marketing performance are:

  1. To determine the economic value that marketing creates for the business; and
  2. To enable marketing leaders to optimize their mix of marketing programs and channels based on economic performance
Both of these objectives require the use of financial metrics, and this requirement has a big impact on measurement complexity. It's relatively easy to measure the performance of most digital marketing tactics and some offline tactics (e.g. direct mail) using non-financial metrics. But it's another matter to measure the financial performance of a marketing program.
The crux of the challenge is attribution, which is the process of assigning both revenues and costs to marketing activities. It's impossible to accurately measure the financial performance of a marketing program or channel unless you can accurately assign both economic benefits and costs to it. So the accuracy of your measurement system ultimately depends on the accuracy of your attribution method or model.
The Demand Gen Report survey provides strong evidence that attribution is a significant barrier to effective marketing performance measurement. Only about 30% of the survey respondents indicated they are doing any attribution analysis as part of their marketing measurement efforts. Among those using attribution, only about half (51%) said they are using some form of multi-touch attribution, while 14% said they use last touch attribution, and 12% said they use first touch attribution.
Research from other firms points to the same conclusion. In a 2017 survey by Econsultancy, in-house marketers were asked to identify the specific attribution methods they are using and rate the effectiveness of each method. The following table shows the percentage of respondents using each attribution method, and the percentage rating each method as very or somewhat effective.

These findings are troublesome because the three most widely used attribution methods (and four of the top five) are methods that attribute all of the revenue from a sale to only one marketing touch point. Even more troublesome, large majorities of the survey respondents rated these methods as very or somewhat effective, when the reality is that no "single touch" attribution method will produce an accurate picture of marketing performance.
Developing an accurate marketing attribution model is not simple or easy. The current "state of the art" is data-driven or algorithmic attribution modeling, but even these advanced solutions aren't perfect. The bottom line is that measuring the financial performance of marketing - particularly at the tactic, program, and channel level - is likely to remain challenging for the foreseeable future.
So how can B2B marketing leaders measure and demonstrate the value of marketing given the complex and imperfect nature of attribution? There are no silver-bullet solutions, but I'll offer a few suggestions in a future post. 

Top image courtesy of Pat Pilon via Flickr CC.