Friday Blog Log, and Happy New Year!

We've come up with an interesting list of links today. Thinking of the New Year, reflecting on 2007 and wondering what 2008 will bring to us...

Thought you'd all be interested in this top ten list of New Years Resolutions. Of course, all of the usual suspects appear--lose weight, get fit, etc. However, topping the list was the resolution to spend more time with friends and family. That's a good one for all of us, no?

We were also intrigued by this Christmas Day post from the Diva Marketing Blog. It talks about how the movie, Miracle on 34th Street can be compared to social marketing. From the movie we all know and love:

"The CEO of a major retail organization briefs the company's ad department. "No high pressuring and forcing the customer to take something he doesn't want. We'll be known as the helpful store. The friendly store. The store with a heart. The store that places public service ahead of profit. The plan sounds idiotic and impossible...consequently, we'll make more profit than ever before."

Yes, the concept DOES sound familiar to the social marketing we're embracing now.

For another look on social media/marketing, check out Greg Verdino's "7 trends that defined 2007". This provides nice insight into what was significant this year in terms of social marketing, including the rise of Facebook and the less-than-stellar rise of mobile marketing.

And, finally, if you're in the mood for cleaning house, check out this post from John Jantsch of Duct Tape Marketing: Fire 10% of your customers. It contains some pretty practical ideas about how to look at your customer base, and how to evaluate just how profitable they might be.

So, there you have it, a round-up of New Years tips for 2008 and reflections on 2007.

Happy New Year to All!

The Direction of Marketing: Some Ideas to Ponder for the New Year

Maybe it's the holidays . . . maybe it's the specific projects that we're engaged in right now . . . but I'm sensing a real change in the direct marketing landscape. Don't get me wrong, as we discussed yesterday, we're still struggling with finding the ultimate solutions for many of the same problems of the past 10 years, too. However, I sense a change in the proverbial marketing weather.

And, apparently I'm not alone in this thinking. As a matter of fact, in a recent post from James Cherkoff, Director at Collaborative Marketing in the UK, he outlines what he sees as this changing landscape. Here are Cherkoff’s thoughts: “Lots of the ideas that seemed radical a few years ago are now accepted as the norm. And many disruptive trends are now presumed to be long-term change. For instance, the idea that television must be reinvented or die is hardly worth the breath and, hey, did you know people don't like interruptive marketing? Search (aka The Database of Intentions) is now more than just a handy function but the way we organise our lives. Also, now that everyone is joined up outside of traditional institutions, it's clear that people regard peers as the purest form of accurate information.” We've definitely seen this to be the case -- particularly this year with the huge expansion and adoption of social media.

It’s not all about online-marketing though. Traditional direct marketing ideas are also being challenged. Our clients are consistently trying to improve their DM campaigns through the use of analytics and more precise targeting. While the use of intelligent analytical methods has been in place for many years now, direct marketers are getting smarter about how to apply analytics to the “right” data source to most effectively reach the most responsive audiences.

Meanwhile, database marketers are requiring more flexible database solutions to house their customer and prospect data. They are also requiring more intelligent analytical tools to better mine the data within their databases. Database solutions providers are struggling to change their paradigm of how to keep up with these needs. We've found that in working with a lot of the database marketing giants, it is difficult -- if not darn near impossible -- to come up with a streamlined database solution that our clients can quickly implement and not spend a fortune on. Interestingly enough, even those companies who have the capabilities to provide the data, the database and the analytical tools can't see clear to providing integrated solutions without breaking the client's budget. So, we're always on the lookout for a nimble and flexible provider in this industry that can meet our client needs -- and exceed our expectations. And this requirement is not going away . . . it is what the customer will continue to demand.

Finally, the idea that there is some sort of "norm" out there for a marketing strategy is just dead wrong. The only consistent factor that we've seen is that the landscape is constantly shifting. Our clients are consistently changing direction and areas of focus with the changing economy. And, this seems to be the case across industries. As we consult with our clients, it has become an exercise of starting from a blank page and crafting an idea of the strategy to go forward with -- but never carving anything in stone.

I guess the over-riding theme here is that as direct marketers, we need to possess the ability to be Gumby-like. We have to be flexible and fast. We need to be able to sense the change in the weather, and then respond to it with lightning-like speed. More than ever, being tuned in to your client's needs -- and really listening -- are the qualities that will create marketing success for us in 2008.

Just How Important is Real-Time?

I remember about 5 years ago when I worked at Experian. The hot topic when we'd get together for sales meetings and to discuss what our clients (large financial services and telecom firms) needed was real-time customer interaction. We felt that if we could develop technologies and data integration techniques to enable access to up-to-the-minute customer data, our clients would be able to now fulfill their CRM dreams.

They'd be able to offer the customer the exact right product that they'd be interested in, at that specific point in time. Think of how happy the customers would be; think of the extra profits to be made.

Now, 5 years later, I see that the real-time dream hasn't really made it to reality.

Most firms still struggle to pull data from IT. If the data is only a week old, that's a good thing. Analysis is one-off and project-based. Rarely (except for web analytics) do senior managers have the ability to access up-to-the minute transaction and customer data.

I found an article that supported my opinion (that we're still pretty far away from realizing real-time) in ComputerWeekly.com. From the article:

"A few years ago, everyone was talking about the real-time enterprise and how it was destined to be the future. The idea was that companies would be instantaneously aware of any important business events taking place so that they could respond appropriately and immediately.

But that has not happened because of both the cost and complexity of such a proposition."

The article goes on to state that the cost of implementing true real-time technology rarely justifies the new-found benefits. It outlines three areas where companies are starting to consider real-time applications:

1. Real-time Reporting Systems--where executives will have access to timely reports so that they can make best-informed business decisions.
2. Business Activity Monitoring--where transaction and customer behavior is monitored in real-time. A certain activity may 'trigger' an action from the firm. A classic example is in the area of risk management--when a firm sees that a customer has started paying other bills more slowly, they change the way their own collections department treats this customer. Typically, they move to a more aggressive collections strategy.
3. Real-time Data Mining--where an agent (typically at a call center) has access to up-to-the-minute customer data so that they can offer the consumer the most appropriate product/service at the point in time that the customer calls them, or comes to them with service issues.

The article concludes with a couple of case studies of companies that implemented true real-time applications.

Lessons learned:

• As much as we direct marketers talk the CRM story, we're still pretty far away from real-time, in most cases.
  
• Where real-time technology has been proven a success, it's only because the firms that tackled the issue faced it logically and found small areas where they could reap immediate and measurable benefits, hence justifying the expense.

We'd love to hear your experiences. Do you have a story where real-time data access worked? Or, where a significant investment was made, only to have it fail?

Friday Blog Log

Welcome to another edition of our Friday Blog Log! Here are our Links of the Week for your enjoyment!

1) Charles Green's Trust Matters: In this Trusted Advisors post, Charles discusses how "issues of the commons show up first in government, later in business, because government by default gets the un-economic propositions. But the issues are increasingly not unique to government." He goes on to state just how trust issues impact business. And if you read our post yesterday, you know that this is an area that we are so very passionate, that every now and again, it causes us to rant. This is a great post, and the comments are very thought-provoking as well.

2) Bob Sullivan's InfoGrow: In Bob's post, he reviews The Association of National Advertisers Conference, where attendees were polled on topics around sales and marketing effectiveness. Another area in which we are passionate is using analytical intelligence in your direct marketing strategy. In this study, attendees polled think that utilizing an analytical approach, along with an effective creative strategy, will be the most important difference makers in 2008. Take a look at the other interesting nuggets that came out of this poll.

3) Paul Paetz AKA The Anti-Marketer: In Paul's most recent post, he discusses "a classic example of what Christensen labels "cramming" in his discussion of disruption theory." He goes on to define this concept: "Basically, incumbents often ignore disruptions until it is too late to do anything about it, and then make valiant attempts to "cram" the disruptive innovations into their existing offering to try to forestall or block the disruption." Paul gives some past examples of cramming that definitely resonated with me. The topic is very intriguing -- and it will be interesting to see if the "cram" that he refers to (the Wall Street Journal recently added a Digg widget to the end of their online articles) proves to be successful. Very interesting reading!

4) Jim Berkowitz's CRM Mastery E-Journal: Here Jim discusses the first of 7 Deadly Claims: Superior Customer Service. Yep, another area of our passion. His comments are dead on. He talks about how making this claim without backing it up by actually having superior customer service can, yes, in fact, be quite deadly. He also discusses how you create excellent customer service by actually wowing your customers, as opposed to stating it all over the place. OK -- I promise not to get started on another rant. We think you'll really enjoy this post, too. It is filled with insightful ideas on the topic, and he's got six more deadly claims to go (actually, 2 and 3 are already waiting for us)!

5) Jaren Angerbauer's post on the Digital Marketing Blog: In this post, Jaren discusses how to effectively manage old or inactive e-mail accounts. With the increasing importance of e-mail marketing in our multi-channel marketing strategy, this post provides some great insight for our consideration.

We hope you enjoy all of these posts as much as we did! And, TGIF, by the way -- don't drink too much eggnog on this Holiday weekend!

Happy Holidays!

Lack of Service in Direct Marketing Industry

A forewarning--I'm grumpy today. Get ready for a rant.

It's not the holiday blues; nothing bad going on in my personal life. No. Today, my beef is with my own beloved industry, Direct Marketing, and the companies that service this industry. Is it only me, or has customer service from large corporations gone down-hill?

This week has been a doozy. One firm (not to mention any names, but it is a large consumer credit bureau) has decided to pull the rug out from under us, change sales reps midstream while we're in the midst of a large project. To make matters worse, they're throwing more contracts at us and we fear that they plan on increasing our price for data that we have already sold to the client (at the lower price). How is that the right way to treat a customer?

Here's another example: Another vendor (a huge player in the DM industry) sees RRW as a competitive threat as opposed to a client. We're spending serious money with them on behalf of our clients. Yet, we have a difficult time in getting them to deliver what they promise or even provide information that will enable us to more effectively sell their products and services. It's always a battle -- and it's the oddest thing, it makes absolutely no sense.

Overall, we see sales reps who don't seem to care about their clients (or their employers, for that matter). We see senior managers that are WAY too far away from the customer and more worried about pleasing their boss. We see that anytime we want to purchase something that is not generic, or 'off-the-shelf'--something that we need to customize, we run into problems. Employees of these large firms are apathetic; they don't want to take the time and they don't seem to want to make the sale.

Is it just us, or is this something that you're seeing out there? We'd love to hear your battles and stories.

Word-Of-Mouth (WOM) More Important than Ever!

In this faltering economy, direct marketers need to make use of every possible strategy to gain the loyalty of their customers and prospects. As you know, we're big believers in utilizing social media as part of the overall marketing strategy. Part of participating in this brave, new world is extending your reach via Word-of-Mouth (WOM).

In a recent article from BizReport, WOM is examined and is reported as being "seriously underestimated by many communicators and often overlooked as a valuable component to a communications strategy." These are the new findings in the annual “Media, Myths and Realities” report from Ketchum and the USC Annenberg Strategic Public Relations Center. The study reports that "less than a quarter (24 percent) of communicators have a word-of-mouth strategy in place." At first blush, this may not alarm you, however, when you consider that WOM is estimated to grow from $981 million in 2007 to $1 billion in 2008, with a continuing upward trend forecasted through 2011 . . . well, let's just say it may be high time to get a WOM strategy in place!

WOM is simply about looking at your prospective audience as a "public of one," as opposed to creating messages for the masses. Said differently, this means that marketers must begin to provide "relevant, meaningful and entertaining content that their audiences will feel inclined to share with others."

In this frenetic shopping season, we marketers can't help but feel the impact of advertisers and the myriad of messages aimed at us -- just like the rest of the consumers out there. And, as we examine our own actions, it is now more apparent than ever that we seek out products and services that we are interested in . . . and are becoming better and better at filtering out what is not relevant or meaningful to us. This is exactly why WOM is so important to consider right now as we communicate with our customers and prospects. As the Ketchum-USC study suggests, "Communicators must focus on speaking to individuals, not just broadcasting to the masses, when getting their messages across to this new 'public of one.'"

The net net . . . creating messaging that appears to be highly individualized, highly targeted and perfect for each one of us.

Data Collection Can Be a Customer Benefit

We write a lot about consumer privacy and how it's so very important that companies treat customer information like gold--that they guard it as carefully as they would any other important asset.

But, as a direct marketer, and one who strongly believes in the power of data and analytics, my mind tends to veer in the direction of: What can I do with this data, now that I have it? What can I up-sell my customers? How can I find more people that look exactly like my most profitable customers?

If you REALLY want to be successful, however, you need to flip the coin and start to think about what the data can do for your customer, NOT what it can do for you. (Oh boy, I'm channeling JFK--scary!)

This article from Destination CRM, brings my point home. It talks about how Amazon now lets consumers edit their purchase history (taking out gifts, for example) to fine-tune their recommendation process. Consumers willingly do this because they have become dependent on Amazon's recs. This point underlined the power of being transparent--letting customers know what you are collecting about them, and why the data is being collected.

"Giving the data back to the customers is just the first step, however. The next is to show customers what they can do with it. This can be in the form of tools like recommendations engines that help customers better find what they are looking for."

The article provides some good ideas of how companies could use customer data to improve the consumers' shopping experience. It points out how apparel retailers, if they mined their data properly, are well-positioned to "develop recommendations systems that can suggest clothes that go with what you have, and best complement your body type." Now, that would be a tool that I could use!

Another example is Home Depot who already offers a tool that helps customers green their home. The article suggests that "with a portfolio of all the appliances you currently have in your home, Home Depot could proactively recommend new products and strategies that can help customers keep their homes green." This is another benefit to eco-conscious consumers.

I really like the thought of thinking of the customer first as you develop database strategies and data collection initiatives. I've love to hear other interesting ideas, or case studies where this was done properly. How did the customer benefit from data collection/analysis in projects you've worked on?