Sunday, January 14, 2018

How Marketers Can Nurture Buyer Trust, and Why That Matters

B2B buyers are conditioned to view vendor-provided information with a healthy dose of skepticism, and this makes lack of trust an elephant-in-the-room issue for B2B marketers. Lack of trust produces a major drag on marketing performance. If buyers don't trust what you say, they won't give you credit for understanding their needs or providing relevant, personalized, and engaging content and experiences. Trust can't be manufactured, but the right approach to marketing can make trust more likely to develop.

According to the 2017 Edelman Trust Barometer, trust in government, business, non-governmental organizations, and media fell significantly in 2017. Just over half (52%) of Edelman's survey respondents said they trust business organizations, but even this modest level of trust is tenuous. In 13 of the 28 countries represented in the Edelman study, less than 50% of the survey respondents said they trust business.

Recent research regarding trust in advertising and marketing has produced mixed results, but many studies show that trust is a major issue for marketers. For example, in a 2017 survey by TrustRadius, technology buyers ranked vendor or product websites and vendor collateral (ebooks, case studies, webinars, etc.) as the least helpful and trustworthy sources of information used to support buying decisions.

Lack of trust weakens the impact of all marketing efforts. In recent years, many marketers have been using insights from data to better understand the interests and needs of their buyers. And many have implemented personalization technologies in order to provide content and messaging that are more relevant and engaging for potential buyers. But without buyer trust, these efforts won't produce the improved performance that marketers are hoping to see.

Trust lies at the heart of every business relationship. Trust can't be manufactured; it must be earned from potential buyers. But while marketers (or sales professionals for that matter) cannot unilaterally create buyer trust, they can take steps to create an environment that makes potential buyers more likely to extend their trust. The starting point is to understand the factors that lead to trust, and the process by which trust develops.

The Foundation of Trust
In a business context, the decision to trust a prospective vendor depends on the buyer's perceptions about three factors:

  • Ability - Does the company possess the requisite knowledge, skill, and competence to perform in a way that will meet my expectations?
  • Integrity - Will the company fulfill its promises? Will the company's actions match its words and claims? Does the company adhere to principles that I find acceptable?
  • Benevolence - Will the company be sufficiently concerned about my (and my organization's) welfare to put our interests above (or at least on par with) its own?
Perceptions regarding ability and integrity have the greatest influence on the willingness to trust in the early stages of a relationship, simply because it takes a potential buyer longer to assess the benevolence of a prospective vendor.
How Trust Develops
Most leading authorities contend that trust develops in stages. In a 2003 essay, Professors Roy J. Lewicki and Edward C. Tomlinson identified two distinct stages of trust development.
Calculus-Based Trust - In the early stages of a relationship, trust is primarily a cognitively-driven phenomenon. We carefully calculate how another person (or a company) is likely to behave in a given situation, and we extend our trust only to the extent necessary to achieve a desired outcome. Calculus-Based Trust is tentative and fragile, and it is usually based on our assessment of a person's (or a company's) predictability and reliability.
Identification-Based Trust - As a relationship evolves through repeated interactions, the parties may learn that they share certain values and goals. When that happens, trust can grow to a higher and qualitatively different level - what Lewicki and Tomlinson call Identification-Based Trust. Unlike Calculus-Based Trust, Identification-Based Trust is primarily an emotion-driven phenomenon, which makes it more durable and less susceptible to disruption than Calculus-Based Trust.
How Marketers Can Nurture Trust
So given what we know about the factors that lead to trust, and the process of trust development, the next questions is:  What can marketers do to earn the trust of potential buyers? There are, in fact, several steps that marketers can take to nurture trust, but here are two of the most important.
Make Content and Messaging Authoritative - Buyers are more likely to see marketing content and messaging as trustworthy if it is authoritative. Therefore, marketers should avoid making unsubstantiated claims and assertions. As I've written before, marketing content resources and messages don't need to read or sound like an academic journal, but the main points should be supported by sound evidence, preferably from sources that are recognized as reputable and credible.
Avoid "Marketing Speak" - Buyers are also more likely to view marketing content and messaging as trustworthy if it doesn't contain a lot of marketing speak. It's difficult to define marketing speak in a precise and comprehensive way, but as Supreme Court Justice Potter Stewart once said about hard-core pornography, "I know it when I see it." And so will most B2B buyers. 
Marketing speak can involve the use of buzzwords and over-the-top or overly-simplistic claims, but it also exists when the overall tone of marketing content or messaging is too promotional. I use a simple test to avoid this particular strain of marketing speak. When I finish a content resource, I ask myself this question:  If an independent and respected journalist were writing an article about this topic, would the tone of the article be similar to my resource?

Image courtesy of Terry Johnston via Flickr CC.

Sunday, January 7, 2018

Confront the "Elephants in the Room" to Maximize Marketing Performance in 2018

Early in my consulting career, I worked with a small company that was owned and managed by a husband-wife team. The business had been fairly successful for most of its ten-year history, but when I began working with the company, it had been losing money for more than a year, and was on the verge of going broke.

In the course of interviewing the owners and many of the company's employees, the core problem became apparent. The husband-owner was having an affair with one of the employees. At that time, the affair had been going on for about two years. The wife-owner and many of the employees knew about the affair, but no one openly acknowledged it, and no one talked about it, except through veiled innuendos. Though it was never mentioned, the affair was undermining the success of the company.

I've shared this experience because it's a classic example of an elephant in the room, and I've encountered elephants in the room several times in my work with clients. The defining characteristic of an elephant in the room is a conspiracy of silence, in which a group of people are all personally aware of an issue or problem, but tacitly agree to outwardly ignore it.

Elephants in the room frequently exist in a business setting when:

  • Company leaders and managers perceive that an issue or problem is unsolvable or beyond their control.
  • The only effective solution for an issue or problem would be painful or highly disruptive to implement.
  • The issue or problem creates doubt about the effectiveness or value of a fundamental aspect of the company's strategy or operations.
When faced with these kinds of issues or problems, we humans tend to put on a brave face, keep doing what we've been doing, and hope for the best. Another appropriate idiom might be "whistling past the graveyard." The only way to deal with an elephant in the room is to get past the conspiracy of silence, discuss the issue or problem openly, and make an informed decision regarding what to do about it, all of which is easier said than done.

Elephants in the room can affect any part of a business, and marketing is no exception. If we look carefully, we can easily identify several elephant-in-the-room issues that are negatively affecting the performance of B2B marketing. We marketers tend to down play, gloss over, or ignore these issues because they are difficult to address, often require "radical" solutions, and in some cases, aren't completely within our control.

There's no doubt that the practice of B2B marketing has changed dramatically. We now have marketing capabilities that were unheard of only a few years ago. But there are also some elephant-in-the-room issues that we must address if we want to maximize the productivity of our marketing efforts. In short, we need to make 2018 the year that we name and tame the elephants in the room.

In several future posts, I'll be discussing some of these elephant-in-the-room issues, and I would love to hear your thoughts on these important issues.

Illustration courtesy of Bit Boy via Flickr CC.

Wednesday, December 27, 2017

Our Most Popular Posts of 2017

This will be my last post of 2017, and I want to thank everyone who as spent some of his or her valuable time reading this blog. My goal for this blog has always been to provide content that readers will find to be informative, thought-provoking, and useful, and I've been immensely gratified by the attention and engagement this blog has received.

For the past few years, I've used my last post of the year to share which posts have been most widely read. In the past, I've ranked posts based on cumulative total reads, regardless of when a post was published. Therefore, older posts had a built-in advantage, and they often appeared in the "most popular" list.

This year, I'm considering only posts that were published in 2017. So, in case you missed any of them, here are our five most popular posts for 2017:

  1. Why It's Time to Reset Expectations for Content Marketing
  2. What You Need to Know About Target Accounts for ABM Success
  3. Research Confirms that Customer Experience Drives Financial Performance
  4. The Economics of ABM Account Selection
  5. The Promise and Peril of Personalization at Scale
Happy New Year, everyone!

Image courtesy of the Republic of Korea via Flickr CC.

Sunday, December 17, 2017

The Key Attributes of Thought-Leading Brands

There's no longer any doubt that thought leadership content is having a major impact on B2B buying decisions. Several recent research studies have shown that business buyers are consuming more thought leadership content than in the past, and that thought leadership affects decisions at every stage of the buying process.

Research has also shown, however, that business buyers are becoming more selective about the content they consume. The volume of "thought leadership content" has grown exponentially over the past few years, and companies are finding it harder to create content that will stand out from the crowd and capture the attention of potential buyers.

A new study by Longitude - a marketing agency based in London - sought to identify the attributes and practices of companies that excel at the development and use of thought leadership in their marketing efforts. This research was based on a survey of 360 executives who are responsible for the management of thought leadership at their organization.

Based on an analysis of survey responses, Longitude identified a set of organizations that are outperforming their peers at "thought leadership marketing." These high-performing companies were designated as Thought-Leading Brands, while the balance of survey respondents were called Followers.

Longitude found that Thought-Leading Brands achieve far better business outcomes than Followers. The table below shows the percentage of Thought-Leading Brands and Followers who reported that they are nearly always successful at using thought leadership to achieve five strategic goals:

The study also found that there was no single reason for the superior performance of the Thought-Leading Brands. In the study report, Longitude observed:  "Instead, it is a combination of factors; they are consistently adopting a broad range of best practices to ensure success."

Longitude asked survey participants to rate their company's performance across eight thought leadership capabilities. The following table shows the percentage of Thought-Leading Brands and Followers who scored themselves as excellent on those eight capabilities:

The Longitude study also highlighted the growing importance of original research in thought leadership success. The study report described the important role of original research in emphatic terms:  "Business audiences are more discerning and will only engage with content that looks too important to ignore. Only the most interesting topics and campaigns - those backed up by robust and genuinely insightful research - stand any chance of getting noticed."

Top image courtesy of Affen Ajlfe ( via Flickr CC.

Sunday, December 10, 2017

Why "Handle With Care" Should Be the Watchword for A.I. in Marketing

Artificial intelligence has been one of the hottest topics in B2B marketing in 2017. The hype surrounding A.I. and related topics, such as machine learning and predictive analytics, has been almost deafening. Many industry pundits are asserting that A.I. is already revolutionizing the practice of B2B marketing.

While some of the claims made about artificial intelligence are exaggerated, it seems clear that A.I. has the potential to be one of the most powerful marketing tools we've seen in the past several years. But some uses of artificial intelligence also have the potential to trigger negative reactions from potential customers. So, before marketers fully embrace artificial intelligence, they need to understand how people feel about A.I. generally, and more specifically, how people view the use of A.I. in marketing.

Syzygy (a WPP digital agency group) recently published the results of an August 2017 survey that was designed to uncover the attitudes of American consumers about artificial intelligence. This survey generated 2,000 responses from individuals in the US, with equal participation by men and women. The respondents were equally split among Millennials, Generation X, and Baby Boomers.

For this study, Syzygy defined artificial intelligence as "technology that behaves intelligently, using skills we normally associate with human intelligence, including the ability to hold conversations, learn, reason and solve problems."

Syzygy found that US consumers have a broad range of feelings - both positive and negative - about artificial intelligence. When survey participants were asked how they feel when they think about A.I., the top four feelings identified were:

  1. Interested (45% of respondents)
  2. Concerned (41%)
  3. Skeptical (40%)
  4. Unsure (39%)
When Syzygy asked survey participants to describe how positive or negative their feelings are about A.I., the results show that strong feelings are the exception, not the rule. Eighty-six percent of respondents described their feelings as neutral, mildly positive, or mildly negative.

Syzygy also asked survey participants several specific questions about the use of artificial intelligence for marketing purposes. The good news for marketers is that over two-thirds of Americans are open to companies using A.I. to communicate with and serve them. However, the study also revealed attitudes that should concern marketers. For example:
  • Seventy-one percent of respondents said that companies should need their express consent before using A.I. to market to them.
  • Nearly nine out of ten respondents (89%) said that the use of A.I. in marketing "should be regulated with a legally-binding code of conduct."
The lesson from this research is that marketers should approach the use of A.I. cautiously and be sensitive to the skepticism and concern it can create. Marketers will need to stress the benefits and value that A.I.-powered applications can produce for customers, and above all else, they must be open and transparent about how they are using artificial intelligence in their marketing efforts.

Image courtesy of James Whatley via Flickr CC.

Sunday, December 3, 2017

Why Proving the Impact of Marketing is Difficult

For several years, marketing leaders have faced growing demands from the C-suite to prove the value of their activities and programs. Marketing accountability has become the mantra for many CMO's, and return-on-investment has become the gold standard for measuring marketing performance. Several books and a host of white papers and ebooks have been written about marketing performance measurement, and dozens of webinars and conference presentations have been devoted to the topic.

But despite all of this attention and brainpower, proving the financial value of marketing is still challenging for many marketing leaders. Data from The CMO Survey - conducted by Dr. Christine Moorman with Duke University's Fuqua School of Business - demonstrates both the significance and the persistence of the challenge. The CMO Survey has been conducted semi-annually for the past several years, and the following chart shows the percentage of surveyed CMO's who have reported they are able to show the impact of marketing spending quantitatively.

Over the past three years, less than half of the surveyed CMO's have said they are able to quantitatively measure the impact of marketing spending on business results.

Proving the economic value of marketing is challenging for several reasons. A recent article in the Journal of Marketing summarized the difficulties as follows:

". . . marketing aims to create and stimulate favorable customer attitudes with the goal of ultimately boosting customer demand. This demand, in turn, generates sales and profits for the brand or firm, which can enhance its market position and financial value . . . As a result, marketing has multiple facets, some attitudinal, some behavioral, and some financial. However, the relation between the metrics that assess these facets is complex and nonlinear . . ."

Measuring the value of marketing activities is a complex undertaking, but the heart of the challenge is usually attribution. Attribution is the process of assigning both revenues and costs to a marketing activity or program, and it's impossible to accurately measure the financial value of a marketing program unless you can accurately assign economic benefits and costs to it. So, the accuracy of your value or ROI calculation ultimately depends on the accuracy of your attribution model. 

The State of Marketing Attribution

A few weeks ago, Econsultancy (in association with AdRoll)  published the results of a study regarding the use of marketing attribution, the goals and benefits of attribution, and the effectiveness of various attribution methods.

The State of Marketing Attribution 2017 report is based on a survey that produced 987 responses from both in-house marketing professionals ("company respondents") (74%) and professionals from agencies, consulting firms, vendors, etc. (26%). Respondents were based in Europe (53%), North America (22%), and Asia Pacific (22%). Company respondents came from both B2B and B2C enterprises operating in a wide range of industries.

Econsultancy found that the use of marketing attribution is growing. Eighty-one percent of company respondents said they are practicing attribution at some level, up from 79% in the 2016 edition of the survey. Thirty-nine percent of company respondents said they are using attribution with most or all of their marketing programs, up from only 31% in 2016.

Econsultancy also found that a growing number of companies are using attribution models that encompass both digital and offline channels. In the 2017 survey, 60% of company respondents said they are using some type of multichannel attribution, up from only 42% in the 2016  survey.

On the surface, the growing use of marketing attribution looks like a positive development. However, Econsultancy's research also revealed some troublesome facts about how marketing attribution is currently practiced. The survey asked participants to identify the specific attribution methods they are using and rate the effectiveness of each method. The following table shows the percentage of company respondents using each attribution method, and the percentage rating each method as very or somewhat effective:

These findings are disturbing because the three most widely-used attribution methods (and four of the top five) are methods that assign all of the revenue from a sale to one marketing touch point. Even more disturbing, large majorities of the survey respondents rated these methods as very or somewhat effective - 92% for first touch, 86% for first click, 85% for last touch, and 74% for last click. In reality, none of these "single touch" attribution methods will produce an accurate assessment of performance of value.

The Econsultancy research also found that most companies don't act on the insights derived from marketing attribution. The survey asked participants to indicate their agreement or disagreement with this statement:  "We don't action the insights we get from attribution." Twenty-three percent of company respondents strongly agreed with the statement, and another 47% agreed somewhat.

It's likely that marketers aren't relying on the results they obtain from attribution because they lack confidence in the validity of the attribution models they are using. They intuitively recognize that those models are incomplete at best, and may be seriously flawed.

The Bottom Line

Proving the impact of marketing is likely to remain challenging for the foreseeable future. Accurately attributing revenue to a marketing activity is a difficult task, particularly for companies with complex sales cycles that involve multiple decision makers.

The most important first step is to stop using all forms of single-touch attribution (first-touch, first-click, last-touch, and last-click). Except in rare cases, any single-touch attribution method will produce inaccurate results and lead to poor marketing decisions.

Custom attribution was regarded as the best attribution method by participants in the Econsultancy research, with 48% of the respondents rating it as very effective. Developing and implementing a custom attribution model requires a fair amount of thought and time, but the benefit is a more accurate view of marketing performance.

Top image courtesy of Rick B via Flickr.

Sunday, November 26, 2017

Two Ways to Boost the Impact of Personalization in 2018

Delivering outstanding customer experiences has become a primary strategic objective for both B2B and B2C marketers. In the 2017 Digital Trends report by Econsultancy (in association with Adobe), surveyed marketing, digital, and ecommerce professionals selected optimizing the customer experience as their single most important opportunity for 2017, and they identified customer experience as the primary way they will differentiate their company from competitors over the next five years.

Most marketers now recognize that personalization is a critical ingredient in the recipe for great customer experiences. In a 2017 survey of marketing and business leaders by Researchscape International (in association with Evergage), nearly all (96%) of the respondents agreed that personalization helps advance customer relationships, and 88% agreed that their prospects and customers expect a personalized experience.

In the Econsultancy study, survey respondents identified targeting and personalization as a top digital priority for 2017 (behind only content marketing and social media engagement), and half (51%) of the respondents said they would increase their spending on personalization this year.

But despite all the recent focus on personalization, it's clear that most companies have more work to do to maximize the benefits of personalized marketing. In the Researchscape survey, only 30% of respondents were very or extremely satisfied with the level of personalization in their marketing programs, and 46% gave themselves a grade of "C" or lower on their current personalization efforts.

Other research has shown that many buyers aren't particularly impressed with the personalization efforts they encounter:

  • In a survey by Adobe, 71% of consumers said they like receiving personalized offers, but 20% reported that offers are not done well.
  • In a study by the Economist Intelligence Unit, 70% of survey respondents said that many of the personalized messages they receive are annoying because the attempts at personalization are superficial.
So what can be done to improve the effectiveness of personalization? There are two important steps that companies can take to boost the impact of their personalization efforts in 2018.

Make It Valuable

To be effective in today's competitive environment, personalization must provide meaningful value to customers and prospects. Personalization that is superficial or superfluous - i.e. personalization that is merely "window-dressing" - simply won't cut it.

Recent research has confirmed that buyers want to get practical value from their interactions with companies and brands. For example, in a survey of consumers conducted earlier this year by the CMO Council and SAP Hybris, nearly half of the respondents defined value as something that saves them time (49%) or makes their lives easier (47%).

Value is equally important to B2B buyers. In a 2017 survey of B2B buyers, Aberdeen Group asked participants what factors they consider when choosing a vendor. Over two-thirds (68.2%) of the respondents said the vendor can help sharpen our competitive differentiation, and over half (55.7%) said the vendor can help me identify new possibilities and avenues for revenue.

Personalization can be a powerful way to enhance the value of interactions with customers and prospects, but it must be designed with that objective in mind. Therefore, marketers should evaluate any proposed personalization initiative by asking a basic question:  How will this application of personalization provide practical value to our customers and/or prospects?

Make It (Mostly) Invisible

Since the early days of personalized marketing, the most common way to personalize a marketing message has been to include specific facts about the recipient in the message, a practice that can be called explicit or overt personalization. 

It's as if marketers believe that the effectiveness of personalization is based on communicating to the customer or prospect what they know about him or her. There may have been some truth to this belief when any form of personalization was rare. Now, however, most types of overt personalization are largely ineffective (because they are so common), and they can be seen as "creepy" by customers or prospects.

Today, personalization is usually more effective when it's invisible. The best personalization doesn't feel like personalization - it just feels like a message or experience that's really relevant, appropriate, and valuable.

There are, of course, some situations where overt personalization is still effective. For example, online stores (such as Amazon) often provide personalized product recommendations that are introduced by a phrase like, "People who ordered [Product X] also purchased . . ." When the personalization algorithm works well, these recommendations can be useful to customers, and most buyers don't view such recommendations as intrusive or creepy.

Illustration courtesy of Michael Coghlan via Flickr CC.