market research

Four Models Every Marketer Should Master

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We know–models can be intimidating. But as the need to add analytics and science to our work continues to increase, models have become one of the primary vehicles every marketer needs to know how to develop and leverage. If you’ve already dived into the deep end on models, congratulations. On the other hand, if you’re just dipping your toe into the water, have no fear, because while there may be a bit of a current, it is time to venture forth.

Mathematical models help us describe and explain a “system,” such as a market segment or ecosystem. These models enable us to study the effects of different actions, so we can begin to make predictions about behavior, such as purchasing behavior. There are all kinds of mathematical models-statistical models, differential equations, and game theory.

Regardless of the type, all use data to transform an abstract structure into something we can more concretely manage, test, and manipulate. As the mounds of data pile up, it’s easy to lose sight of data application. Because data has become so prolific, you must first be clear about the scope of the model and the associated data sources before constructing any model.

So you’re ready to take the plunge–good for you! So, what models should be part of every marketer’s plan? Whether a novice or a master, we believe that every marketer must be able to build and employ at least four models:

  1. Customer Buying Model: Illustrates the purchasing decision journey for various customers (segments or persona based) to support pipeline engineering, content, touch point and channel decisions.
  2. Market Segmentation or Market Model: Provides the vehicle to evaluate the attractiveness of segments, market, or targets.  More about this in today’s KeyPoint MPM section.
  3. Opportunity Scoring Model: Enables marketing and sales to agree on when opportunities are sales worthy and sales ready.
  4. Campaign Lift Model: Estimates the impact of a particular campaign on the buying behavior.

These four models are an excellent starting point for those of you who are just beginning to incorporate models into your marketing initiatives. For those who have already developed models within your marketing organization, we would love to know whether you have conquered these four, or even whether you agree these four should be at the top of the list. As always, we want to know what you think, so comment or tweet us with your response!

Measuring Relevancy: A Three Step Approach for Linking Content and Behavior

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Various studies over the years have examined the relationship between content relevancy and behavior. Almost everyone would agree that content must be relevant. But what is relevance? According to Wikipedia: “Relevance describes how pertinent, connected, or applicable something is to a given matter.” A thing is relevant if it serves as a means to a given purpose.Image

In the context of this discussion, the purpose of content is to positively influence customer or employee behavior, such as increasing purchase frequency, purchase velocity (time to purchase), likelihood to recommend, productivity, etc.

When we ask marketers and others how they measure content relevancy, we often hear, “We base it on response rate.” If the response rate meets the target, then we assume the content is relevant; if response doesn’t meet the target, we assume it’s not relevant.

Clearly there is a relationship between relevance and response. Intuitively we believe that the more relevant the content, the higher the response will be. But measuring response rate is not the best measure of relevancy. Many factors can affect response rate, such as time of year, personalization, and incentives. Also, in today’s multi-channel environment, we want to account for responses or interactions beyond what we might typically measure, such as click-throughs or downloads.

So, what is the best way to measure relevancy?

The best-practice approaches for measuring relevancy are many, and many of them are complex and require modeling. For example, information diagrams are an excellent tool. But marketers, who are usually spread thin, need a simpler approach.

The following three steps provide a way to tie interaction (behavior) with content. It’s critical
that you have a good inventory of all your content and a way to define and count interactions, because once you do, you’ll be able to create a measure of relevancy.

The process and equation include the following:

1. Count every single piece of content you created this week (new Web content, emails,
articles, tweets, etc.). We’ll call this C.

2. Count the collective number of interactions (opens, click-throughs, downloads, likes,
mentions, etc.) for all of your content this week from the intended target (you’ll need to
have clear definitions for interactions and a way to only include intended targets in your
count). We’ll call this I.

3. Divide total interactions by total content created to determine Relevancy: R = I/C
To illustrate the concept, let’s say you are interested in increasing conversations with a particular set of buyers. As a result, this week you undertook the following content activities:

• Posted a new whitepaper on a key issue in your industry to your website and your
Facebook page
• Tweeted three times about the new whitepapers
• Distributed an email with a link to the new whitepaper to the appropriate audience
• Published a summary of the whitepaper to three LinkedIn Groups
• Held a webinar on the same key issue in your industry
• Posted a recording of the webinar on your website, SlideShare, and Facebook page
• Held a tweet chat during the webinar
• Tweeted the webinar recording three times
• Posted a blog on the topic to your blog

We’ll count those as 17 content activities.

For that very same content, during the same week, you had the following interactions:

• 15 downloads of the whitepaper from your site
• 15 retweets of the whitepaper
• 15 Likes from your LinkedIn Groups and blog page
• 25 people who attended the webinar and participated in the tweet chat
• 15 retweets of the webinar
• 15 views of the recording on SlideShare

That’s a total of 100 interactions. It’s likely that some of these interactions are from the same people engaging multiple times, and you may eventually want to account for that likelihood in your equation. But, for starters, we can now create a content relevancy measure:

R= 100/17 = 5.88.

Using the same information, had we measured only the response rate, we might have counted only the downloads and attendees—40 responses—so we might have had the following calculation:

R = 40/17 = 2.353

As you can see, the difference is significant.

By collecting the interaction data over time, we will be able to understand the relationship between the relevancy and the intended behavior, which in this example is increased “conversations.”

I strongly encourage you to consider relevancy as a key measure for your content marketing. By tracking relevancy, you will be able to not only set benchmarks and performance targets for your content but also model content relevancy for intended behavior.

Be a Better Event Organizer

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Lately, we have seen an increase in two requests from event organizers: send a customer to speak instead of you and/or speak for free. While made with the best of intentions, these requests are at the very least rude and at worst portray organizations as unprofessional. Why are these seemingly innocuous requests rude?Image

Mack Collier of The Viral Garden has articulated why it is wrong to ask experts to speak for free, saying that good speakers spend days creating material and preparing for a presentation. He estimated that he spends “anywhere from 15 to 30 hours preparing/rehearsing the presentation, and loses a minimum of one day due to travel, usually two days.” This is a big investment of time for anyone — and for experts, time is money. A good event organizer will not ask a speaker to speak for free and they will cover travel costs. Speakers understand the need to offset costs by giving speaking slots to sponsors. But sponsors are advertisers. Just because someone paid for a sponsorship doesn’t mean they have the expertise you need.

As someone who has organized numerous events, my goal is to secure speakers who provide the expertise participants will benefit from. The speaker’s expertise should be lending credibility and value to your event. Framing the event as a business development opportunity for the speaker is unprofessional; the reason to select speakers is for the value they bring to your program. A good speaker is not there to make a sales pitch; rather, to educate, entertain, and/or motivate the audience.

The second request is to substitute a customer as an expert. The underlying message is “you are good enough to do the work for a company but not good enough to speak at our event.” This request places the experts and their customers in a very difficult situation — who pays for the customer’s travel since many companies’ travel budgets have become restrictive, who prepares the presentation, who preps the customer since they are not experts, how do they handle Q&A’s, what if a company commitment comes up and they need to bail, and so on.

This kind of request often results in the experts paying travel for both the customer and
themselves, preparing the presentation since the customer doesn’t have the time or expertise, and having do a dive and catch when the customer has a last-minute schedule conflict. It also creates schedule challenges for dry runs, which can negatively impact the event attendees’ experience. It is easy to see that this particular request creates an enormous amount of work and additional costs for the experts and additional work for their customers with no payoff for either party.

In today’s environment, customers want to use their limited resources to reach their prospects and customers, to grow their businesses. Their time is money, too, and they want to invest where they will see the best return. If you want to be a better event organizer, stop making these two requests of the experts who can add tremendous value to your event.

Does Your Marketing Team Have the Right Stuff?

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The 
Right 
Stuff,
 a
 1979 
book 
by 
Tom
 Wolfe, 
chronicled 
the 
sequence
 of 
events 
bridging 
the 
breaking 
of
 the
 sound
barrier 
and 
the 
Mercury 
space
 expeditions.
 The 
book 
(and 
subsequent
 movie)
 explored
 why
 the 
Mercury 
astronauts
 accepted 
the
 danger
 of
 space
flight,
 as 
well
 as 
the 
mental
 and 
physical 
skills
 required 
of 
them 
to 
do 
their 
job—in 
other 
words,
 the 
”right 
stuff.”Image

Recent 
studies 
suggest
 the 
need 
for 
many 
marketing 
professionals to
 re‐skill
 and 
re-tool.
 Only 
about 
5
 percent 
of 
marketers 
surveyed 
in 
a 
recent 
CMO 
Council 
study 
are 
highly
 satisfied 
with
 their 
levels 
of
 accountability, 
operational
 visibility,
 and 
marketing 
output. 
Most 
see 
plenty
 of 
room 
for 
improvement.

So what skills
 and 
tools
 are 
needed for 
your 
organization 
to 
have 
the 
right stuff?

Regardless
 of 
company 
size 
and 
industry, marketing 
teams 
(whether
 a 
team
 of
 one
 or 
more) 
are under 
increased
 pressure 
to
 drive 
top‐line
 growth 
and
 profitable 
revenue. 
For 
many
 organizations
 this
 means 
acquiring new
 skills 
related
 to 
marketing
 performance 
measurement
 and 
management,
 analytics, 
benchmarking,
 and
 customer
 engagement. 
 Let’s review 
these 
four 
specific
 skills
 every
 marketer
 should 
have 
under 
their 
belt:

• 
Metrics
 and 
performance 
target‐setting. With
 greater
 demand
 for
 marketing 
to 
be 
more
 accountable,
 solid 
metrics, 
performance 
target‐setting,
 measurement,
 and 
reporting skills  
are
 crucial.
 Participants 
in 
numerous
 studies 
comment
 on 
the 
importance 
of
 being 
able 
to 
set
 measurable 
goals
 and 
track 
results. 
These
 skills
 will 
be 
in 
vogue 
for 
a 
long 
time 
to
 come.

•
 Analytics.
This 
is 
the 
ability 
to 
derive 
insights 
from 
data. 
If
 growing 
valuable 
customer relationships
 and 
being
 able 
to 
forecast
 sales 
from 
future
 marketing
 activities 
are 
important,
 then 
analytics 
ought 
to 
be 
on 
the 
top
 of 
your 
skills‐to‐acquired 
list.

•
 Benchmarking.
This 
is 
the 
process
 of
 comparing 
what
 your
 company 
does 
to
 another 
that
 is 
widely 
considered
 to 
be
 an 
industry 
standard 
or 
best 
practice. 
The aforementioned
 CMO 
Council
 study 
indicated
 58
 percent 
of 
respondents 
have 
nominal 
or no 
benchmarking 
capabilities. 
If 
you 
don’t 
know 
what
 the
 standard 
is,
 how 
will 
you 
know 
what
 to 
strive 
for 
when 
it 
comes 
to
 such 
things 
as
 win/loss 
ratios, marketing 
key performance 
indicators,
share
 of 
preference,
 product
 adoption 
rates, and 
so
 on?
 Benchmarks
 are 
essential 
to
 any organization 
that
 believes 
continuous 
improvement
 is
 critical 
to 
the 
pursuit 
of excellence.

•
 Customer 
experience 
management. 
If 
business 
exists 
to 
produce 
and
 serve 
a
 customer,
 and 
marketing’s 
job 
is 
to 
create,
 communicate, and
 deliver 
value 
to 
customers, 
then
 marketing 
is
 your
 organization’s 
ultimate 
steward 
of
 the 
customer
 experience.
 Marketers 
need 
to 
be
 sure 
they 
have 
the
 skills 
necessary 
to 
improve 
customer
 engagement
 and
 touch-
point 
effectiveness. 
They
 also 
must respond 
to 
changes in 
the 
buying
 cycle
 and
 conduct
 voice‐of‐customer 
research in
 order 
to 
retain
 customers, 
create 
loyalty,
 and 
transform 
customers 
into
 advocates 
for the
 company.

Marketing 
operations 
refers 
to 
infrastructure — that 
is,
 the 
tools, 
systems, 
and
 processes in 
place 
to 
facilitate 
customer‐centricity.
 Forty‐four
 percent
 of
 the
 respondents in the CMO 
Council
 study 
are looking 
for 
way 
to 
lower
 costs 
and 
improve 
go‐to‐market 
efficiencies. 
For
 many 
organizations,
 achieving these 
operational
 efficiencies 
requires 
infrastructure changes 
and 
improvements.

With 
limited 
resources, 
where 
can
 you 
get the 
best
 bang
 for 
your
 buck?
 Here
 are 
four
 areas
 for 
investment 
consideration:

1. Operational
 process 
alignment.
 When 
was 
the 
last 
time
 you 
mapped 
your 
operational 
processes 
and 
verified 
marketing 
alignment
 with 
the
 sales,
 product,
 service,
 and
 other 
parts
 of
 the
 business?
 All 
of
 us 
get 
into 
routines 
and 
habits.
 Reviewing 
processes 
and
 updating 
them 
may 
be 
time consuming, 
but 
if
 you 
are 
looking 
for
 ways 
to
 reduce 
inefficiencies 
internally, 
this 
is a
 necessary step.

Many
 years 
ago,
 when 
I
 was 
in 
the
 semiconductor 
industry,
 we
 needed 
to 
find
 a 
way 
to 
reduce 
the 
time 
from 
order 
to 
delivery
 of
 product.
 It
 was 
just 
taking 
too 
long 
to 
get
 product 
to 
customers,
and
 we
 didn’t
 know 
why.
 When 
we calculated 
the 
time 
it 
took 
for
 the 
individual
 steps 
of
 order 
placement, 
manufacturing,
 testing ,
assembly, 
and
 shipping, 
the 
time 
didn’t
 add 
up 
to 
what 
it
 actually 
took.

So
 we 
mapped
 the 
process, 
counting 
the 
time 
product
 was 
”in‐transit,”
 whether 
physically 
or 
in
 some
 other 
way.
 Lo
 and 
behold, 
the 
in‐transit
 time
 was 
off
 the 
charts.
 The
 mapping 
process 
enabled 
us 
to 
identify 
the 
inefficiencies,
 label the white spaces,
and 
put 
in 
new
 processes 
to 
reduce
 and
 even 
eliminate 
them.

2.Market/Business 
intelligence. 
There 
is 
an 
art
 and
 science 
to 
using 
external 
information 
for 
driving 
business 
strategy. 
Business 
intelligence 
applications 
enable 
the
 collection,
 integration,
 analysis, 
and
 presentation
 of
 competitive,
 channel, 
product,
 and 
customer 
information 
to 
derive 
trends 
and 
insights.
 The 
value
 of
 having
 such 
a 
tool 
is 
that, 
when 
used 
properly, it
 enables 
you 
to 
begin 
conducting
 scenario 
analyses
 and
 anticipating 
the
 future.
 With 
the 
insights
 derived
 from 
business 
intelligence,
 there 
is 
the
 potential 
to 
anticipate 
the 
development 
of
 new
 markets, technological
 turning 
points,
 and 
how 
the 
competitor 
will react.

3. CRM. 
If 
the 
marketing
 organization 
is 
responsible 
for 
the 
relationship 
between 
the
company 
and
 the 
customer,
 then 
it
 stands 
to 
reason 
the 
organization
 needs 
tools 
to 
facilitate 
this 
relationship.
 As 
you 
know, 
there 
are 
a
 range
 of
 CRM 
tools
 out
 there,
 so 
selecting
 the 
right
 one
 can 
be 
a
 daunting 
task.
 Even
 so,
 in 
today’s 
environment
 a
 company
 can’t
 afford
 to 
operate
 without 
a
 formal
 approach
 to
 customer
 relationship 
management.
 Of
 course,
 once
 you 
have 
the 
tool
, the
 next
 biggest
 hurdle 
is 
using 
it.

4.
 Performance 
management.
 The 
ability 
to 
use 
analytics, 
reporting, 
and
 dashboards 
to 
assess
 marketing’s
 effectiveness, efficiency, 
financial
 contribution,
 and
 progress 
toward
 achieving 
pre-determined
 goals 
is 
performance 
management. 
In 
the 
end, 
marketing
 must
 demonstrate 
its
 value, 
which 
lies 
in
 how much you are “moving 
the 
needle.” This 
necessitates 
reporting
 on
 performance, impact, 
and
 ROI from
 the
 program 
level 
up.

Progress 
doesn’t
 come 
without
 missteps,
 misfires,
 and failures.
 Winners 
look 
for
 ways to overcome
 challenges
 and
 continuously 
improve.
 They
 seek
 outside 
help,
 new 
ideas,
 and new 
skills.
 While
 attending 
a
 Webinar,
 reading 
a 
book, 
or
 going 
to
 a
 conference 
helps, consider 
looking
 for
 ways 
that
 will
 enable 
the 
whole 
team 
to 
be 
on 
the 
same 
page
 at the
 same
 time. 
There are 
plenty 
of 
on-site
 and 
online 
programs
 offered 
by 
professional
 organizations 
and 
institutions, as 
well
 as
 by 
firms 
specializing 
in these 
areas.

In 
Wolfe’s 
story, 
the 
national 
heroes 
of 
the 
Mercury 
space 
program 
were 
not
 necessarily 
the 
truest 
and
 best. 
What 
they
 possessed
 was 
the 
right
 stuff, the
 skill
 and 
courage 
to 
”push 
the
 outside 
of
 the
 envelope.”
 Does 
your
 marketing 
team
 have 
the 
right 
stuff?

Power Tools-Use with Caution

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The results from the marketing performance research recently conducted jointly by ITSMA and VisionEdge Marketing (VEM), and Forrester were just announced. In its 12th year, the purpose of this study has been to understand how proficient marketers are at measuring and managing performance; using metrics, data, and analytics; and communicating marketing’s value, impact and contribution to the business. This year’s study captured input from more than 400 respondents. The study revealed areas in which marketers have made strides and areas where marketers remain challenged.Image

The result I found most perplexing was that, while marketers have access to more data than ever, leverage more analytics, and invest in more tools and systems, they continue to struggle to prove marketing’s contribution to the business. One clear indicator of this is that just 9% of CEOs and 6% of CFOs use marketing data to help make strategic decisions. Less than 10%! Although the majority of the marketers regularly produce and share a marketing dashboard, they are not bringing valuable, useful information to the table.

So where’s the disconnect? If you want your leadership team to understand how marketing is moving the needle in terms of top line revenue, market share, customer value, category ownership, and so on then the dashboard needs to be able to tell that story. Unfortunately, it appears that most marketers participating in the study use their marketing automation (MAP) or sales automation (CRM) systems to create their dashboards. In fact, dashboards and reports are already integrated into many of these systems. These dashboards, however, typically report on marketing activity and associated costs – email activity, website activity, social media activity, lead activity- rather than reporting on metrics executives can to set direction. It’s not that these reports and dashboards are bad; they are valuable when used to support tactical decisions, but if you want your CEO, CFO and other members of the C-Suite to use your dashboard it must clearly connect marketing investments and initiatives to business outcomes and results.

The ability to push a button and generate a pretty report that doesn’t add any value to the strategic decisions made at the C-Suite level doesn’t serve marketing well. To be on the right track, you need to start by making sure the marketing initiatives and investments are clearly aligned to business outcomes and that you have the right metrics in place. Otherwise, investing in better marketing tools is akin to buying a power saw when you have yet to master a hand saw. You have the ability to do more damage faster.

Learn more about the survey results and some initial impressions at:

Cracking the Code on Marketing and Sales Alignment

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The dynamics of the 21st Century are forcing businesses of all sizes and types to be able to react quickly and decisively to rapidly changing business and competitive conditions and Imagechanging customer demands. The more agile a company, the faster it can respond to market dynamics and develop new products and processes, recognize new opportunities, and redeploy resources accordingly. The degree of agility may be the difference between being a market leader instead of an also-ran. Agility requires proactive planning, business intelligence, alignment and collaboration among all the key functions to make the right decisions and turn opportunities into a competitive advantage. One of the key alignment issues facing many companies is the alignment between Marketing and Sales.

Marketing and Sales Alignment Remains Elusive

The issue of marketing and sales alignment isn’t new. Most marketing and sales people have been in organizations where marketing has been known to accuse sales of not following up on leads and refusing to track leads through the sales cycle and sales has been known to accuse marketing of not providing viable qualified leads. This misalignment is often attributed to a variety of factors, such as different goals, different timelines, and different psychologies. Market dynamics such as commoditization, the Internet, mobility and virtualization and changing business models only compound the problem. Companies attempting to resolve the issue often approach the problem by trying to tighten the alignment of marketing activities within the sales cycle, improving coordination around lead generation, and increasing sales force participation in the marketing process. Sadly these attempts often fail. Regardless of various approaches taken by companies to address this issue, the lack of alignment and collaboration between marketing and sales persists. Both organizations need to change for the organization to succeed.

 From Transactional to Customer Centricity

To achieve greater alignment, both organizations need to decide together which market segments offer the best opportunities and deserve the highest priority. Today’s buyers are more sophisticated and today’s buying processes are more complex. The transactional approach of marketing generating qualified leads that sales then brings to a close is an outdated view. The transactional approach is what permits marketing and sales to operate as independent silos. This results in Sales immersing itself in the latest training, engaging in calling on customers and focusing on post-sale efforts and Marketing focusing on implementing various campaigns and 2 coordinating a variety of tactics.

A Customer-Centric Approach Offers Hope

Customer Centricity requires a company to look at the world through the eyes of the customer, what they want from you, what they expect from you, what they can count on from you. One way to become more customer-centric is to move from looking at the world from a selling perspective to taking a customer relationship lifecycle perspective. Taking a customer relationship lifecycle approach provides an avenue for alignment by focusing both organizations on the same set of outcomes – creating, keeping and growing the value of customers. The customer relationship lifecycle begins the moment a customer appears on the radar screen, moves into the lead-sales funnel, emerges as a customer and engages in a variety of experiences that result in them becoming an advocate. The customer relationship lifecycle provides insight into which customers provide the greatest values to your company. As result, the company can create a set of common metrics for both organizations which will help ensure alignment. Customer relationship management metrics include buying related metrics such as recency frequency and quantity; cost related metrics such as gross amount of money spent on acquiring and retaining the customer through marketing dollars, resources spent generating each sale, and post sales service and support; and customer value related metrics such as the duration or longevity of that customer’s relationship with your business, the referral rate, and share of wallet. Establishing a common set of customer-centric metrics facilitates alignment and collaboration and provides both organization with customer-oriented vocabulary and set of priorities.

Does Alignment Matter?
While no one can offer any guarantees, aligning Marketing and Sales makes good business sense and ultimately impacts the bottom line. A study conducted by Aberdeen on sales effectiveness with more than 200 executives from the executive, sales, marketing and IT management functions study found that companies that had strong collaboration between these two functions achieve a higher sales effectiveness. For many companies, this additional boom in sales more than justifies making the effort.