How does a Marketing Doctrine look like?

This blog post examines how a Marketing Doctrine looks like based on the article by Challagalla,Murtha and Jaworski (2014) that was featured in a LinkedIn piece.

Marketing doctrine refers to a firm’s unique principles, distilled from its experiences, which provide firm-wide guidance on market-facing choices

Challagalla,Murtha and Jaworski (2014)
Marketing Doctrine: Source Table 4, Page 10, Challagalla,Murtha and Jaworski (2014)

If you think about it, the marketing logic of both Marketing Doctrines start jumping out. Here are a few to think about:

  • Change in sauces is much slower than cell phones:  If you think of the sauce market in the US, the major innovation has been Sriracha hot sauce but no major sauce maker has probably gone out of business. Think cell phones and and the devastation of Blackberry and the recent moves by Amazon Fire come to mind. So the Apple doctrine of being willing to cannibalize your own product seems to make great sense,
  • Focus groups matter more to the consumer product company because their category is a lot about loyalty. Your customers might buy more bottles of competitor Sriracha sauce but will not entirely stop using your brand… particularly if you come up with a “hot” version for your brand loyalists.
  • Innovation is upstream in high tech  and downstream in low tech: High tech industries like cell phones, biotech  require that innovation is build into the early ideation,design and usability stages of new product development. On the other hand, low tech consumer products like sauces is a lot about the innovative consumer facing launch activities like sales promotion and sampling.

While above examples are from different industries, the point of the Marketing Doctrine is to separate yourself from competitors in your own industry. Thus, the Apple Marketing Doctrine would be very different from the Samsung Marketing Doctrine. More on developing a Marketing Doctrine in a later post.

About StratoServe.

American Time Use Survey 2013 : Where is Computer, Mobile use?

American Time Use - Where is computer mobile Internet - StratoServeToday a TV announcer was hesitantly happy that Americans are reportedly watching 2.46 hours of TV a day, (up 11 minutes) from 2003. This from the Wall Street Journal story about the 2013 American Time Use Survey (ATUS)  of the Bureau of Labor Statistics, US Department of Labor. The hesitation to celebrate, that TV is becoming stronger, is understandable. Because TV folks know that there is just too much competition for American eyeballs from the Internet including social media that is accessed from computers,tablets and mobiles- even while watching TV.  So we decided to research why computer, mobile and generally the Internet was not covered in the Bureau of Labor Statistics survey. Here is what we found:

  • It may not be the telephone survey: One comment on the WSJ story suggests that since the survey was conducted on telephone – it had biased responses. Who answers telephone surveys these days? Given that the BLS folks are  good at what they do, that's not the reason. See the ATUS Technical note.
  • It may be the survey questions and the tyranny of time series econometrics: The survey questions remain the same to allow econometric analysis over time, which is great. The problem is that American and global behavior is changing rapidly over the last few years.Should the questions change to reflect real behavior?  For example, according to PEW research, 87% of Americans use the Internet. See ATUS Questionnaires.
  • The answer may be in coding of responses: The ATUS coding rules might have the answer to where the Internet use behavior of Americans is hidden in the ATUS. We quote from page 19 of the 2013 ATUS coding rules:

    "Using the computer: Code the activity the respondent did as the primary
    activity. For example, if the respondent used the computer to search for
    work, code as Job Search and Interviewing (0504xx). If the respondent
    used the computer to pay bills or for financial management, code as
    Household Activities/Household Management/Financial management
    (020901). If used for playing games, code as Socializing, Relaxing, and
    Leisure/Relaxing and Leisure/Playing games (120307). If used to write
    letters, code as Household Activities/Household Management/HH and
    personal mail and messages (except e-mail) (020903). If respondent
    reports computer use for leisure, or can’t/won’t specify the purpose, code
    as Socializing, Relaxing, and Leisure/Relaxing and Leisure/Computer use
    for leisure (exc. games) (120308)."

The above is a relief as it appears that any Internet, computer and mobile use is most likely included in the other categories of activities in the ATUS.

It is hard to believe that Americans spend less than TV time in front of their Internet devices. Just watch what people do as they wait for a plane,bus,doctor, or a  date- they are working their smart phones if not a tablet ! It might be a good idea to have some direct Internet questions in the next round of the ATUS or modify the coding. Contact StratoServe.

Why are TV ads encouraging you to research online?

In the last few days TV ads have been airing  that encourage you to research on-line. Finally TV advertisers are acknowledging that in many product categories, customers are unlikely to move without on-line research.

So which are these path breaking TV Ads that have come out openly – encouraging research by consumers? The first ad we noticed was for Rhino Shield , a ceramic exterior paint that is claimed to be long lasting. The Ad actually asks viewers to "Google" the product. The second Ad noticed today was for "Honda CRV" that encouraged people to "research" without mentioning the Internet, search or a search engine. The Honda brand is much stronger than the Rhino Shield brand and indicates an "across brand phenomenon".[We could not immediately find these TV ads on-line and will update this post with links to the actual Ads ].

The question is: has TV advertising conceded to the Internet when it comes to information, at least in the high value categories like entire home exterior paint, car buying?  The short answer is "Yes" and here are some more thoughts on this major shift:

  • Information asymmetry in serious decline:Information asymmetry in marketing meant that the seller had more information than the buyer and it was difficult for the buyer,particularly individual consumers, to obtain information. With Internet Search, Social Media and rating sites like Yelp and Trip Advisor it is not just cars and home improvement but a $10 lunch that is being researched.
  • Mobile-Smart  phone search: Today's data plans at US wireless providers encourage the user to find a wireless router where they are. Many public places including shopping malls have started providing free wi-fi knowing that people have limited data plans and in any case they will do some on-line research before buying at the mall. By refusing to accept this change in buyer behavior, shopping malls will only hurt their own sales.
  • Some poor ratings are OK – think of elections: Marketers should not worry too much about getting all the best ratings because buyers tend to see such ratings as rigged. Try to address and report action taken on poor ratings and move on- is probably the best course for marketers. Think of any hotly contested election – the (first ) buying decision is somewhat similar to a vote when you know the negatives about each candidate.

That TV ads are encouraging you to research on-line indicates that marketers are finally acknowledging this major change in buyer Internet behavior. Exciting times are ahead. Contact StatoServe.

Non-Profits must start preparing for 2014 giving season- A look at High Net Worth Donors

The US charitable giving season corresponds to the Thanksgiving-New Year period and now is a great time to start preparing for the 2014 giving season. With about 1.5 Million non-profts – think of any social cause- and there are hundreds if not thousands of charities operating in that space offering stiff competition for donor dollars. This post is about motivations of High Net Worth individuals in giving and digital marketing clues that non-profits can use. But first a re-cap of academic research on donor motivation. 

A recent literature review by Bekkers and Weipking (2011) lists 8 motivations of charitable giving based on prior research. These motivations are in no particular order and the authors suggest that several of these mechanisms might work together. The mechanisms include: (1) awareness of need i.e. the donor must know that a need exists (2) Solicitation or asking for donations (3) Costs and benefits to the donor- for eg. preferred seating at college football games (4) Altruism or the motivation to do good (5) Reputation of the donor among peers (6) Psychological benefits – for example the "joy of giving" (7) Values like making the world a better place (8) Efficacy or the knowledge that the donation made a difference.

These sound like a  lot- so what should Non-Profits focus on for this Giving Season?

A good place to start is the 2012 Bank of America Study of High Net Worth Philanthropy done in collaboration witth the Center of Philanthropy at Indiana University. High Net Worth (HNW) is defined as people with over $ 1 million in assets (excluding their home) and incomes over $200,000. 

StratoServe - Motivations of Giving of High Net Worth Individuals - BoA study 2012

To better understand the role of HNW giving – for 2011 data 70% of the $300 Billion giving was by individuals. Half of these were from HNW donors or they represent over $100 billion of giving a year and at least one-third of total donations in the US. When asked about future giving, these individuals painted a positive outlook in the 2012 survey. Most HNW individuals also increase their giving for the giving season.

Keep in mind that HNW donors are discerning donors with financial advisers, lawyers who also advise them. Larger non-profits tend to have "Major Gift Officers" who  work with HNW donors as well. Going by Eric von Hippel's Lead User idea, HNW donors motivations of giving does provide a window to donation behavior of the numerous small donors who make up over $200 Billion of annual giving in the US. Many of these large numbers of donors will donate online in 2014.

This summer, Non-Profits should try and articulate at least one thing from the  graphic above. Our favorite is:

  • to articulate how exactly the donation will help the cause of the non-profit on the non-profit website, direct mail and other fundraising efforts

And incidentally, a narrow focus hugely helps with the Internet- whether it is organic search and SEO or advertising via PPC like Google AdWords. Contact StratoServe.

Why are B2B sales prospects not followed up?

Why B2B Prospects are not followed up?- StratoServe

This “Sales Statistics” slide has been making the rounds of LinkedIn and there seems to be some agreement that these statistics ring true. The statistics ring true for large organizations with a separate marketing division that helps generate leads that the sales organization does not follow-up. The statistics also ring true for small businesses where the owner is the “sales-in-chief.”

We are not talking about unqualified leads but qualified prospects. These folks might have filled in a form on your website, left their business card at your trade show booth, exchanged cards at a conference, already be your contact on social media with a demonstrated interest in your product or services. In other words there is at least one interaction, initiated by the prospect who thought that your product or service was of interest. Going by the simple AIDA model they had crossed the threshold of Awareness to Interest. Wow- that sounds upbeat and yet….not followed-up?

Here are some thoughts on why this lack of follow-up happens:

  1. There is no data tracking system: There is no system to keep track of the leads, prospects and generally the sales pipeline. Despite a whole array of CRM (Customer Relationship Management Software) and Sales Force Automation (SFA) software available. Some available for free.
  2. No data updates on CRM/SFA: When there is some sort of CRM/SRM system, even an informal Excel sheet, that data does not get updated. For example, you get a call from a prospect with a question that you answer- but forget to update your system. Larger organizations with salespeople on salary plus commission suffer a great deal from this one. Salespeople do not want to update stuff because they do not want rivals or bosses to know- till they close the sale. Meanwhile they forget to follow-up!
  3. Following up is uncomfortable: Face it, following up – even by email is tough when you have heard – “we are working on this” several times from a prospect. It seems far more comforting to call existing clients and try some cross-selling or up selling or engage in paperwork and internal co-ordination with production, finance etc.

Based on research by Sabnis, Chatterjee, Grewal and Lilien (2013) in the Journal of Marketing, organizations can do the following to improve chances of lead follow-up:

  • Improve perception of lead quality: The key is that sales people must perceive  the difference in the quality of leads. Say you have a hundred business cards from visitors to your trade show booth. You must have a method of scoring leads that differentiate between those who are quick wins (must contact next week) and those that might eventually buy.Sales meetings should emphasize why some leads are high quality and if your sales people understand and buy in, it would galvanize your sales force.
  • Avoid micromanaging sales people: Even if you have a sophisticated cloud based CRM/SFA system, avoid the digital temptation of peering over the heads of your sales team. The research suggests that while inexperienced salespeople are more willing to be micromanaged the experienced folks actually resent it. Probably this resentment  leads to avoiding updating the system on part of the sales team.
  • Quantity of leads less important than quality of leads: If you believe that your sales cycle is long then lead quality is more important than quantity. Your lead quality also helps the sales team focus. Factor in any leads that sales force members bring in as the “ownership” of such leads tends to be higher.

Understanding why sales prospects are not followed up and then taking some steps to facilitate your sales force can help. About StratoServe.

2014 Yale Customer Insights Conference takes stock of the Digital Age

YaleCIC2014-StratoServeAs expected the 2014 Yale Customer Insights Conference (#YaleInsights14)  last weekend turned out to be hugely useful as it took stock of the Digital Age. Billed as "where leading thinkers and doers come together to advance the knowledge frontiers of evolving customer behavior" … this time all the practitioner (doer) talks were on Friday along with a sprinkling of academic (thinker) talks.  Saturday was an all academic half day, that was well attended by practitioners who did not want to miss out on the cutting edge work presented. 

All speaker slides will be available on the conference website, but here is a summary of some key themes that resonate with this blog:

1.Emotions matter: With all the information on the web,big data,  instant connectivity via social media emotions still matter- a lot. That the conference was on the mother's day weekend provided wonderful material for some speakers to connect with the audience and drive home this evergreen marketing topic. Carolyn Everson of Facebook  had her 74 year old mother, and the audience, feeling proud that although she was not accepted as an undergraduate at Yale, here she was delivering the keynote address at the 2014 Yale CIC !  OgilvyOne's Dimitri Maex presented a British Airways video in a session on big data based on his book "Sexy Little Numbers."  The marketing challenge was that British Airways was doing poorly with Indian expatriates in the US for travel share to India. The little data collected informally i.e. no big spreadsheets,SPSS, SAS  or Hadoop was – what do you miss back home? "Mum and home food" was the qualitative response. With just a YouTube video British Airways- A ticket to visit Mum, British Airways saw over a million views of the video  with huge gains in market share. Two days before mother's day almost everyone was crying in the audience !

2.Test, Experiment continuously: Today we are deluged with customer behavior data from internal CRM systems and web analytics systems. Presenters were unanimous on the need for constant testing because customer preferences change so fast today. And the testing and experimentation is relatively much easier and less expensive today. Make multiple versions of web pages and layouts and test for the one that works better… the data is easily available via Google Analytics.

3.Mobile Mobile : A major emphasis by speakers was the growth in Mobile phones. A fun fact mentioned was that there are more mobile phones on the planet than toothbrushes or toilets. If you are reading this make sure that your website is mobile friendly. And that goes for bankers  and banking as well as a Bank of America executive in the audience pointed out.

4.Advertising pathways and new media: There was a whole bunch of interesting presentations on the pathways that advertising takes to win or keep customers. Pathways being the need to inform,remind and engage customers with your brand  said Mitchell Lovett of University  of Rochester. Paid Media (advertising like Google AdWords), Earned Media ( eg. social media like Facebook) and Owned Media (your website) play different roles in the customer journey. Some interesting presentations about Twitter:

  • Customers use Twitter for sharing bad experiences about the brand and Facebook for sharing  good brand experiences  was the message from the research of  Marlene Towns of Georgetown University. 
  • Twitter is great for informative advertising according to field research by Juanjuan Zhang of MIT. The field research conducted in China with Sina Weibo – the Chinese version of Twitter and subsequent  viewing of TV shows.

5. Decline of the Brand in the Digital age:  The shocker of the conference was really on Friday when Itamar Simonson of Stanford University offered that today with almost perfect information online- brands are no longer proxies for quality as discussed in his book  Absolute Value.  So brand building might be a waste. Customers tend to check reviews online before buying and are frequently willing to give a weaker brand a shot if the value is right. 

So are marketers powerless in the digital age as power shifts to the customer? Not really because the digital age allows for more transparency and if your product or service is great and constantly improving with customer insights…..the digital age is full of exciting opportunity. Contact StratoServe.

How is B2B Marketing different from B2C marketing?

How is B2B Marketing different from B2C marketing? is one of those fundamental Marketing 101 things that anyone who takes a marketing class must study. Surprisingly, there appears to be  substantial confusion between these two concepts and this post is an attempt to clarify the differences between the two. For simplicity, let us assume a for-profit business that is doing the B2B buying:

  1. Need is different in B2B and B2C: Need is very different in B2B and B2C. When a business buys in B2B they are primarily buying to feed their internal operations. The feeding may be an internal user – deep inside the buying organization. Think  of a machine that an operator and manufacturing group will use in a distant factory. “Feeling good”, “great brand” are less important than functionality. What you sell to a business must do the job – for the business- that both are hoping for. B2C is far more personal satisfaction oriented. If drinking a new fruit smoothie makes some consumers feel great- that’s the target market for your B2C product.
  2. Few in B2B and many in B2C : When you market to businesses there are far fewer businesses in numbers than consumers. If you market a frozen pizza your B2B are grocery stores (few) and your B2C are customers of the grocery store(many).
  3. Personal selling in B2B vs Pull marketing in B2C: Because of the low number of businesses in any tightly defined B2B market, personal selling is viable and relationships are critical. Since B2C customers are many , in most cases it’s not economical for the marketer to engage in personal selling. Exceptions are high value consumer items ( eg. a  roof replacement  or major home renovation). Most B2C has to rely on pull marketing i.e you advertise your branded frozen pizza on TV, newspaper, flyers,  Internet so as to build brand awareness so that the customers goes and asks for your brand at the grocery store. The grocery store upon facing this consumer “pull” is more amenable to your B2B sales pitch to carry your frozen pizza.

If you are in business you have B2B customers, its  very useful to have a sense of who are the next point B2B or B2C  customers in your value chain, and what they are looking for. 

Check out our new online training on ” Decode your B2B Buying Center“.

Be stingy with keywords in Pay-per-click (PPC) advertising

Be Stingy With Keywords-StratoServeBeing stingy with keywords in Pay-per-click (PPC) advertising seems a natural thing to do but somehow the advertising platforms (like Google AdWords) make it easier to just add keyworks to your campaigns. But first about the structure and logic of a Google AdWords account:

  1. Campaigns are at the top: You start with campaigns… so if you have an online shoe store you might have one campaign for dress shoes and  a different one for casual shoes.
  2. Campaigns break down to Ad Groups: A dress shoes campaign might have an Ad Group for laced dress shoes and an Ad Group for  slip on dress shoes.
  3. Ads belong to Ad Groups: The Ads that you write belongs to Ad Groups.
  4. Keywords belong to AdGroups: At the lowest level, keywords belong to AdGroups. If the keyword is searched and clicked , an Ad from your AdGroup is served.  You pay for the keyword.

Thus, it makes sense to have only a few keywords for each each Ad Group that direct the traffic (via the clicked Ad) to your website. With all the ease of the keyword planner type of tools it is very tempting to keep adding keywords to your campaign but this makes your marketing diffuse and start lacking in focus.

A razor sharp focus on your target market and how they might search for your product is central here. Here are some tips from Google on how to build the best keyword list. It is far better to have many Ad Groups with short lists of keywords that are not duplicated at any other campaign or Ad Group.

As explained in an earlier post, do not spray and pray with keywords. Instead ,try to make sure that the keyword-Ad-your web landing page are making sense. For every time a visitor arrives on your website and leave immediately (bounces) your keywords cost more for Google and the search engines are about making their searchers happy. The logic is simple- if the searcher finds what s/he is looking for upon searching a keyword and landing on your website… hopefully they will convert into customers for for you. It is a win-win for all three parties i.e. the searcher, the advertising business and the search engine. Contact StratoServe.

Click fraud- the difference between display and search advertising on a tight budget

Click Fraud is in Display StratoServeA recent article at the WSJ by Suzanne Vranica must alarm digital marketers  as she writes about A "Crisis" in Online Ads : One third of traffic is bogus. This as digital advertising climbs to $50 billion this year. An earlier WSJ piece on phony traffic, clarifies that it is the display advertising where problems arise as scam websites use robots (bots) to increase clicks and then the website owner claims to have huge traffic and then charges a big fee to put in a banner on the website. Search advertising has a far lower click fraud rate. But first some definitions:

Display or Banner Advertising is a bit like old media advertising: Similar to Newspaper, Magazine  and TV ads display ads can put your text or picture ad including banner ad on a website. The key is that the website has the quantity and quality of traffic that the advertiser is looking for. In the old media world there would be independent auditors that would provide reliable numbers of printed copies,circulation and demographics so that the advertiser knew what she was getting once the brand ad was placed on a particular magazine. Today since everyone can be a web publisher , the  magazine ad has shifted on line with exactly the same hopes of the marketer: to primarily build brand awareness.  Here a twist happens because :

Unlike magazine ads  that only sometimes carry a direct response form- every internet ad leads to the advertiser's website !

Now expectations of the advertiser zooms but more on Return on Investment (ROI) in a later post. But to summarize, "follow the money" is the rule here and choosing reliable websites has become a necessity for today's digital marketer. Chasing fraud is exhausting and detracts from marketing effort unless off course, you have a huge randomly allocated budget on display advertising.

Search Advertising or Pay per Click (PPC ) is the other prominent model where the advertisers ads show up against search queries. Here "follow the money" leads you to search engines like Google,Yahoo and Bing who make money through clicks. This blog hugely supports PPC because it is the "new" in the digital marketing. Never before could you show an ad when someone is searching (OK the nearest old media parallel are the Yellow Pages). Unlike yellow pages where you had to call , you can simply check out a whole bunch of market offerings. Here too advertiser expectations are high and the expectation is that a large number of clicks should convert to orders. As explained in earlier posts – the consumer journey could be 9 visits before placing an order. The better the alignment of your keywords,Ad Text and landing page content, the sooner is the conversion.

So what should you do if you have a tight digital marketing budget ? Stay away from banner ads give these truly alarming stats beyond click fraud.  PPC platforms like Google AdWords allow you to choose search and or display networks. It's a good idea to stay with search advertising, see some ROI and then move to display advertising. Contact StratoServe.

How important is a mobile website to your business?-Check your web visitor data

You watch a bunch of kids sitting together and not talking but on their smart phones, and you know that Internet and even social  behavior is changing. According to Google Insight Research conducted by Neilsen in November 2013:

  1. 15 hours/week on mobile: Consumers spend over 2 hours a day researching online on smartphones.Before making a purchase they visit the website 6 times!
  2. 74% start with search on mobile: 74% people start with search on asearch engine and then move to particular websites or apps.
  3. 69% expect the store to be within five miles: And 10% searchers expect that the store is within one mile.
  4. 55% want to purchase in next hour and 83% within the day: Of those who researched your business on mobile- the majority want to buy through the phone.
  5. 54% of restaurant searchers made a purchase, i.e. of the 70% who searched for a restaurant on their mobile phones- a majority actually went to have a meal at the restaurant. The numbers are lower presently for apparel and electronics but stunningly 93% of those who searched on mobile went on to buy either from the store or online.

That was how consumers are changing their behavior on mobile phones but how exactly are they doing on your website? Well, its rather easy to find out. Logon to your Google Analytics account for your website and on the left panel there is  a tab called "Mobile" that gives you data of mobile visitors. You also can see the new visitors who came in the previous month via mobile. By changing the date range you can examine the trend in mobile visitors- on your website. Just below the mobile tab, you can see the devices people use like Apple iPhone, iPad,Samsung etc. In other words, you know exactly what is happening with mobile visitors on your website.

Invariably, people would be spending more time on your website  if they came to your website via desktop. This is understandable, because on mobile your attention span is shorter due to the smaller screen even if your website is mobile optimized.

Given that your visitors are likely to visit your website via mobile , it is highly desirable to have a mobile optimized website i.e. a website that is fairly easy to read on mobile screens.

The important thing to remember is that your consumer journey may take upto 9 touch points. These touchpoints could be online from different devices like mobile,desktop,tablets  through search. Also online through social media and also offline through visits to your physical store.

In this mix of approaches that folks are using today, it is important to mobile optimize your website and also focus your online advertising efforts to the mobile visitor segment of your visitors. For example, Google AdWords gives you an option to show how the ad will look on mobile. Also the settings allow you to frame separate campaigns for mobile. Contact StratoServe.