Manhattan Marketing Maven

Facebook Courts Direct Marketers

Facebook Exchange,  FBX the ads in the News Feed -- the primo real estate on Facebook -- is a year old and vying to become an indispensible partner to direct and CRM marketers.

The pitch directly addresses the needs and anxieties of brands that want consumers to take action on social networks. Facebook, in a new deck circulating to advertisers, argues that they can find, mirror and more accurately target audiences, simultaneously access desktop and mobile users on a broad range of devices, leverage search and display ads across the Internet and do better ROI metrics.

There is nothing subtle in Facebook’s move to curate, qualify and market audience segments. Absent is the long-standing claim that Facebook is strictly about relationships, sharing, engagement and saving the world.

Most of the magic is a three-stage data mining process. By taking data from brands and combining it with demographic, psychographic and behavioral data from third party sources like Epsilon, Acxiom and Datalogic, marketers can get a tighter bead on likely buyers.

Then by matching combined brand and outside data with Facebook profiles, the platform can deliver a specific message to large numbers of individuals meeting very narrow criteria eliminating waste and optimizing the likelihood that consumers will opt-in, share, sign-up, download or buy something. Like traditional publishers or broadcasters, Facebook claims to offer seamless and measurable targeting, reach and delivery.

Facebook claims a 50% accuracy advantage over the average online campaign. This is the Holy Grail for direct marketers; maximum response with minimal waste across channels at efficient costs. For brands without a direct marketing or CRM infrastructure, Facebook potentially is a plug-and-play solution since brands can potentially find and reach their best customers, find more prospects that look like best customers or create new target segments virtually on the fly. But while Facebook will deliver a branded message to targeted users and tell you what percent of your database are on Facebook, they won’t share the details or trade data with brands.

With massive reach and strong frequency, based on the fact that people check their newsfeed as much as fourteen times each day, Facebook is looking to take serious market share away from display advertising, search and email marketing.

The social network’s leading mobile posture is a second strong direct response argument. With zillions accessing Facebook everyday on smartphones and tablets, a brand can reach their customers and prospects and finesse all the costly, complicated and confusing device, rendering and carrier issues with one partner.

Tight targeting and mobile access when combined with links to branded websites, pixel tracking for retargeting and internal databases, gives a brand continuous exposure to people who have shown any sign of interest. This is, depending on your perspective, is either super-targeting or super-stalking. Either way, research shows that it delivers more, faster response.

It also explains how that pair of shoes you looked at on Zappos follow you around the Internet and appear on your Facebook page. Newsfeed or Timeline units, a 154x154 pixel image and several lines of copy, were created precisely to enable precision targeting and pixel tracking to enable retargeting on Facebook and across the web. Consumers can like, share and comment on FBX ads, so virility is baked in. 

My clients using these units are reporting strong cost effective results. And even though many have been extorted into buying ads since Facebook choked off access to the fans they accumulated by manipulating the Edgerank algorithm, the guys paying the bills now can find out how many fans, followers or likers are actually buying products.

Facebook is aggressively addressing direct marketing fundamentals and focusing on critical ROI concerns. Many of their social network peers are following suit. It will be fascinating to see how and how quickly traditional direct response partners respond. Stay tuned. It’s about to get very interesting. 

The Importance of Customer Preference

In a world filled with endless consumer choices, too many marketers still push out one-size-fits-all messages. Very few CRM cadences are self-directed by consumers, which might account for generally flat or low response and engagement rates. 

At a time when everybody is a gamer used to picking characters or avatars, setting game play levels and making choices of all kinds, marketers rarely give their customers and prospects the option to set preferences for content, channels or cadence. Too many acquisition, lead generation, usage stimulation, loyalty or adherence programs are serial fulfillment exercises rather than genuine expressions of customer relationships. They are one-way streets masquerading as two-way relationships. And while it’s much easier for marketers to decide what to say and when to carpet bomb their lists, it is counterproductive. 

The “R” in CRM needs to be more prominent in the thinking, programming and infrastructure of marketers. There is a reluctance to ask consumers for more information based on a generalized anxiety about privacy. But this is a fake-out. Greater data yields more personalized, relevant and useful content, which, in turn gives customers greater value and a stronger connection to the brand. Study after study has shown that when consumers perceive genuine value they are ready, willing and able to share personal information. This value exchange is the core of all CRM programs. 

Similarly, when consumers set preferences and brands execute on them, research suggests that engagement, purchases and customer satisfaction soar. The trick is incorporating preference as a highly desired element with a CRM architecture or environment. A brand without a preference center is partially faking CRM. 

Ideally customers should be steered to a preference center early in the relationship; when their interest and intentions are high. They should be asked for basic contact data and the requisite opt-ins and then be given some choices about what kind of information or incentives they want, how frequently they want them and which communication channel is best to reach them without annoying them.  

Setting up a preference center requires a modest amount of database preparation and an infrastructure to securely capture and transmit the data provided. In some cases, this data can be stored in ESP tools and used to inform triggers and business rules for email. You can’t really create a preference center unless you have a database architecture in place.

The challenge is the investment. Too many clients see even modest infrastructure costs as “non productive” since there is no immediate ROI. That view is myopic. Giving customers choices and in so doing binding them to their favorite brands pays off again and again over time. When it comes to preference, brands need to step up to honor and accommodate customer preferences.  

Leverage Loyalty Fundamentals

In a nation that loves to eat out, restaurants ought to be CRM learning laboratories. Unfortunately they’re not. But Jim Daleen, CEO of Appsuite, hopes to change all that. 

Restaurateurs commonly skimp on marketing. They don’t think about connecting their brand to their customers. Many assume that the food and the ambiance will do it for them automatically, saving an investment in technology or marketing people.

But this state of mind ignores the key psychological factor that underlies loyalty. People want to be known and recognized in their favorite restaurants. Personal customized service pays off whether it’s a free drink, a bonus dessert, an amuse bouche or just a bit of public schmoozing with the chef. A loyal restaurant customer will spend $10,000 over five years if they eat out once a week and spend $40.  So if that’s the average lifetime value of a fan, it’s well worth managing the customer relationship. 

In constructing his app, Daleen focused on 3 critical building blocks of customer loyalty. 

Utility. His app enables patrons to book a table, either directly or through Open Table, order a take out meal, divert themselves during wait times with menus, games and fun food facts, check in on Foursquare or share the menu or their review on Yelp, Trip Advisor, Facebook or Twitter. The app synchs with common customer behavior. It provides a helpful service and is designed to be used in context. Useful value exchange is the foundation stone for building consumer loyalty. 

Connection. You can’t stimulate customer traffic and repeat purchases if you aren’t connected to your customer base. The app creates a virtual private network (VPN) between a restaurant and its patrons enabling personal, targeted pushed messages. Cueing best customers about specials, reminding them its osso bucco night or delivering a birthday, anniversary or Valentine’s Day offer creates momentum and reinforces the sensation of belonging or of being an insider that consumers treasure. 

Rewards & Incentives. The app has a built-in points system that connects to a restaurant’s POS system. Not only can restaurateurs track orders, food or wine preferences and dollar value, they can reward selected purchases, incent social sharing and enroll their best customers as brand advocates. Each restaurant can set up a cadence for rewards using business rules to deliver rewards, coupons or offers directly to patrons’ phones. 

Loyalty is a function of brand familiarity, utility, connection and rewards. Jim Daleen’s AppSuite leverages these fundamentals. So maybe soon restaurants will be at the leading edge of CRM practices.

Related articles

AppSuite, the Hospitality Technology Experts, Layout the Future of Customer Loyalty

The App Fantasy

Apps hold out the possibility of fulfilling marketers’ persistent fantasy  -- that consumers will record daily, personal activity and that this data will fuel on-going relationship marketing programs. This belief is especially strong among pharmaceutical marketers who dream of patient diaries and yearn for patient data as a door opener for the patient-doctor conversation, widely acknowledged to be the single biggest hurdle in the DTC. 

Depending on how you count, there are as many as 97,000 existing mHealth apps ranging from broad-based health and wellness tools to single brand, single action apps. Three out of four are paid apps. Fifty seven percent are aimed at consumers and most are either dosing calculators or reference materials. 

In real life, less than 1000 of these apps have more than 500 downloads. Pinch Media reports that just 30% of apps are used the day after they are downloaded. And twenty days later the number drops to 5 percent. Americans have an average of 41 apps on their but actually use just eight or 1 out of every 5 apps they download. 

There are dozens of apps for chronic disease states like diabetes, asthma and depression that record incidents and data points or track adherence to dosing.  The Pew Internet Project reported in January 2013, that 69 percent of Americans track some kind of health data and one in five of them use some form of technology. All apps live or die by providing either utility or diversion. 

Apps could give us 24/7 medical monitoring with the potential to better understand how people respond to conditions and the opportunity for heath care pros and brands to be in regular conversation with people about their particular heath issues. Apps have the potential to marry data flows and body mechanics to Marcus Welby, MD. 

But this won’t happen automatically. Marketers need to do much more ethnographic research about patients, better understand the practical behaviors and day-to-day attitudes of people suffering from diseases and think carefully about the interplay of 3 or more devices with each other and the real world in order to develop apps that real people will actually want and use. 

Inside Big Brother

Who scares you more – the NSA, collecting every bit of electronic communication you create on every device in every channel, or Acxiom, collecting and aggregating every bit of data about who you are, where you are, what you do and what you have? 

This week, Acxiom, the nation’s biggest data aggregator, in a pointed move to stave off additional regulation, created a new free data portal for consumers to see, read, process and edit your own data. You can even opt-out. 

Don’t think for a second this is a gratuitous act of kindness or a public service. This is a bold and creative attempt to pre-empt or soften threatened privacy legislation or regulation. By proactively giving consumers a look into the black box, Acxiom hopes to stave off added scrutiny, reporting or disclosures. 

About the data.com offers a free glimpse into what they know about you. You get access in 20 seconds by confirming your name, postal address, email address, date of birth and social security number; the key data points that enable aggregators to find and sort you. These facts are also the critical variables that establish and validate identity in the world of data collection. 

Once you’re in, the site indicates where the data originated – bank records, credit cards, merchants, surveys, government records, telephone books, property records, tax rolls, licensing agencies, website cookies, magazine subscriptions, club memberships, etc. The information is sorted into six categories – characteristic data (demographics), home data, vehicle data, economic data, shopping data and household interests. Some easily collected or inferred facts (e.g. race, religion, alcohol use, heiress, frequent trips to Vegas) are not displayed. Each section can be easily edited/updated in two clicks. 

Looking through each section you can quickly see what your credit cards, mortgage records, driving license and reading habits reveal about you. You can sense how Acxiom and its competitors dice and slice you into sellable segments. It becomes clear why you get mail and the e-mail from the marketers pursuing you. You’re a baby boomer who owns a home, holds a graduate degree, drives a two-year old car worth more than $30,000, lives in a desirable zip code, owns a Mac and buys lots of stuff online. Thinking across categories, you get a relative feel for where you might fit in society and how desirable (or not) you might be to credit card marketers, charity solicitors, packaged tour operators, airlines, live performance marketers, realtors or luxury car salesmen. 

It’s ingenious. Consumers get to see their dossier and correct or update the information. Acxiom gets the benefit of the doubt and the benefit of real-time self-corrected data. And, while you can opt-out; the site warns you that opting out won’t stop the SPAM. It merely will insure you get irrelevant SPAM. 

The privacy debate is moot and menacing. Nobody really controls his or her own data. In case after case, consumers willingly and happily give up data in return for coupons, sweepstakes entries or trinkets. The question is who has access to your data and how much trouble or misery can they cause you by using it.  Who is worse  – a faceless government bureaucrat or a faceless marketing bureaucrat?

Related articles

Acxiom gives you a peek at the data it collects about you

Behind the Data Curtain

Acxiom prepares to open its data vault for consumers

4 Latest Loyalty Marketing Strategies

Marketers have been manufacturing consumer loyalty through rewards and loyalty programs since the 1970s. The average American belongs to seven programs and 7 out of 10 are willing to join more programs. 

Most of us sign up for rewards from airlines, credit cards, grocery stores, gas stations, favorite retailers and a hotel chain or car rental firm. A third of most programs have members who have defected in-place without formally cancelling. Forty seven percent of respondents stopped participating in one of their programs in the last year. 

And yet in spite of competition and attrition, fifty-seven percent of respondents say they modify when and where they buy to maximize loyalty benefits. Forty-six percent say their choice of brands is a function of optimizing reward value. Loyalty marketing is personal, fickle, schizophrenic and well worth doing. 

Building and sustaining loyalty is tricky. Its part stimulus-and-response conditioning, part value exchange and part emotion or experience driven brand love. The dynamic mix of these rational and irrational elements in the context of larger macro economic factors, like a recession, or micro factors, like an awful experience with a store clerk, can change quickly. 

What looks valuable today; is piddling tomorrow. Too often the experience of trying to redeem points or miles is so frustrating, infuriating or just plain unfair that it destroys the rationale for collecting them. On the other hand a free trip, automatically applied coupons or discounts that yield free groceries or a first class upgrade can be sublime. 

Enter Maritz Loyalty Marketing who recently published its first US Loyalty Marketing Report, under the leadership of Scott Robinson and Bob Macdonald.

They surveyed more than 6000 people in 30 national loyalty programs across six industry sectors.

Here are the 4 key drivers of loyalty program satisfaction they discovered. 

Relevant Communication is Critical. Duh! While more than 9 out of 10 members want to hear from their loyalty programs only half (53%) see the communications are relevant. Fifty-seven percent of members read everything they get from their rewards programs while just 12% say it’s too much. Everybody wants to know the rules, the news and what’s in it for me. 

Duplicate Channels. Almost all participants (96%) want communication and almost half (46%) want it in at least three channels. Seventy-three percent want their mobile device to interact with their loyalty programs. But only a third (37%) see mobile as their primary loyalty channel. These are the people most likely to download loyalty apps. Loyalty loyalists want their communications on their terms and they want a choice of access points that they direct. 

Finesse the Cool-to-Creepy Spectrum. Sixty nine percent like and want personalized offers based on purchasing habits. These are the “do it for me” people. Sixty-two percent prefer to drive themselves. They want offers based on preferences that they manage. Both groups want rewards earned and  applied to the stuff their care about most. 

Some consumers feel understood and appreciated when offers are based on their attitudes or behaviors. Others are entirely creeped out by the experience. Loyalty marketers need to segment participants to find the right balance and test the information-for-value exchange to determine consumers tolerances. 

More than a quarter (29%) of participants think programs require or acquire too much information prompting privacy concerns.  There’s a built-in paradox here. If program satisfaction is a function of relevance and data collection drives relevance; without data you are doomed. 

If you don’t collect and use the data, you risk developing programs and content that nobody cares about. That’s probably why in spite of generalized privacy concerns a majority of Americans still trade personal information for relevant offers. 

Don’t Discount Values. On some level, loyalty is about brand awareness, preference and advocacy. Don’t let CRM tactics fool you. There is a strong link between personal values and brand values. Forty percent of those surveyed see their favorite brand’s values as “the same as mine.” People who see themselves in alignment with a brand’s values are much more satisfied with loyalty programs. 

This is classic branding strategy. Successful brands mirror image the personality, values, voice and tonality of their best customers. Loyalty marketing needs to focus much more on content and messaging to resonate with program participants. Its probably time to let consumers into the tent and ask them to co-create content and tactics that reflect who they are and what they believe in. 

In a plugged-in, on-the-go, ADD society, loyalty is a constantly shifting bogey. Yet this new data offers some insights, approaches and tactics that can create, capture and apply the longing for connection, recognition, reward and love in each person. 

 

 

 

 

 

 

 

 

 

 

Can CPG Crack the CRM Code?

CPG brands have had an off-and-on relationship with CRM and loyalty marketing over the years. Every brand attracts loyalists. Most brands fantasize about identifying, motivating and rewarding them since they buy more, buy more often and tell everyone they know about the brands they love. Every so often CRM becomes the flavor of the year in CPGland. 

But CPG brands haven’t succeeded in CRM for three fundamental reasons. 

Customer Ownership. Classically retailers built relationships with brand advocates and CPG firms paid the bills. They sort of cooperated with each other to reach and engage customers. For many retailers, CPG is the cash cow behind their shopper marketing activities and many retail chains make a huge effort to optimize CPG contributions often by including brands in promotions, circulars and loyalty card reward efforts. But CPGs and retail partners don’t always have the same priorities or marketing objectives. Retailers prefer to set the marketing agenda and choose the tactics that CPGs subsidize. Retailers rarely, and then only selectively, share customer data with CPG partners.. 

Digital, social and mobile media allow brands to side step retail relationships and develop independent relationships with their fans. New technologies can disrupt, circumvent or compliment existing retail loyalty or CRM programs. But CPG marketers haven’t figured out how to work with or work around retail partners and are reluctant to compete with or alienate them. 

Data Ownership. The pendulum, both in terms of customer sensibilities and CPG budget allocations, seems to be swinging toward building and sustaining direct consumer relationships. P&G, Nestle, Unilever, Kimberly-Clark, L’Oreal and Kellogg’s have all initiated large scale data mart projects aimed at centralizing efficient data collection in service to relationship building and marketing or loyalty programs. With little or no data sharing from retailers, these firms are starting fresh, although they have the budgets to buy or rent big data to get started. 

These initiatives, which tend to provoke internal turf battles, turn on the ability to motivate consumers to opt-in and create cost efficient mechanisms to capture data and trigger personalized communications. Gaining access to consumers is easy. Convincing them to part with data, preferences, purchase history and/or real time behavior is a serious challenge. So is figuring out what to do with the data they collect and getting multiple brands within a portfolio to play nicely together. 

Relationship. Perspective CPG marketers see CRM as a cheaper channel to activate sales. These programs start with the premise that by communicating and couponing, they can inexpensively move more products faster. Control is a key factor. Nobody wonders about the kind, texture or frequency of relationship consumers want to have with their favorite brand. 

So what kind of relationship do consumers want with their favorite peanut butter, sour cream, hair gel or breakfast cereal? 

The evidence from social media suggests that strong brand relationships give consumers not marketers control. Consumers express preferences for channel, content and frequency of contact. Loyalists want insider information, early warning or access to new products and as many offers, deals and freebies as they can get. In many cases, marketers see this as unfavorably subsidizing sales they would ordinarily get anyway. 

If CPG marketers expect to eventually succeed at building genuine consumer loyalty programs, they need to commitment to a relationship building program over time, develop the infrastructure to support both corporate and brand level one-to-one communication and surrender control to their best customers. Anything short of these monumental changes will just be another failed experiment.

Facebook's Emerging Ad Strategy

If you pay attention, you can begin to see Facebook’s ad sales strategy coming together. 

The announcement that Facebook is buying Atlas from Microsoft comes on the heels of Facebook’s announcement of big data alliances. The pieces of Facebook’s future advertising juggernaut are emerging. 

First, figure out how to better engage advertisers by cross-tabbing and de-duping their CRM databases with Facebook fan bases so they can plan ads and campaigns more effectively. Second align with big data suppliers to enable segmentation building, intense precise targeting and personalization. Third, use the Atlas infrastructure to build more ways to dice and slice Facebook audiences and to serve Facebook ads with better precision and metrics. The game plan directly addresses the biggest objections in adland. 

The Atlas buy feels like a play to accelerate building infrastructure rather than developing a new third-party ad-serving revenue stream. The value of Atlas, widely considered second tier behind Google’s Doubleclick platform, is a head start on proving the impact and value of Facebook ads to a growing number of skeptical advertisers. With Atlas in-hand, Facebook programmers and strategists can start modifying and adding onto an existing platform, which will give them something to brag about and sell more inventory sooner.  

The combination of these three moves will allow Facebook to answer many of the outstanding questions on targeting, impact, metrics and ROI by big name advertisers who have embraced social media advertising tepidly. 

Data-centricity will fuel better targeting, tighter message strategies and the ability to drive sales in real time. The mother lode of data emerging from the combination of sources, not to mention Facebook profiles, will yield a huge competitive edge in identifying likely prospects, building propensity-to-buy models, scheduling ads and forecasting or driving sales in real time. 

Add this information to growing opportunities for advertisers to track conversion events like registrations or checkouts and the possibly inadvertent slip exposing a new metric called “return value” and you might get the idea that at Facebook, social media is morphing into direct and database marketing.

Social CRM Prompts Skepticism

There’s a lot of talk about social CRM but much less action. The idea of mining social media to develop one-to-one relationships, curry favor with customers and prospects and develop loyalty is a seductive illusion. The reality is that very few companies have a clear understanding of what social CRM is, why they need it or why they should invest in the time, energy or technology to make it happen. 

A recent survey in CRM Magazine found that 41% of a thousand companies surveyed had no CRM program and that 47.5% are either evaluating social CRM or doing it informally, whatever that means. A mere 11% of those surveyed have a formal program in-place. We are looking at a slim segment of early adopters and a great mass of wait-and-see marketers. 

Part of the slow uptake is a growing skepticism about the genuine business value of social media. Part of the hesitation is uncertainty about access to reliable data, doubts about dealing with Facebook, Twitter and their ilk and confusion about the ROI of undertaking a labor intense social CRM effort.  

The leading business goals of social CRM are lead generation, community building, brand awareness, marketplace intelligence, increased web traffic and customer satisfaction. But hardly anyone can connect the dots between the available solutions set and achieving these business goals. To a certain extent, marketers 

The common objective is actionable customer insight. Conventional CRM wisdom is that the more data points; the better. The big software firms offer what appears to be the whole enchilada -- an online-offline aggregation of purchase history, contact, campaign and response history, web traffic, mobile usage, social activity and geographic location. 

The upstarts offer social data and social activity with the promise that these data sets can be married to others but more importantly they can drive real-time communication through pre-fabricated digital, social, mobile or location-based apps or messaging. 

Both sides will provide software-as-service (SaaS), secure cloud storage and consulting help. Most will provide ways to analyze the data or dice and slice on-demand. Unfortunately there are very few successful case studies and nobody is touting their business results from marrying up with either the start-ups or the established players. 

The key to unleashing social CRM is building a business case and positioning this emerging tactic in the context of an overall marketing effort. Making smart social CRM decisions will turn on the answers to these five critical questions, which will be unique for each brand: 

• What are your business objectives for social media?
• What function is social media playing in your marketing mix?
• Do you collect, aggregate and use offline customer data now?
• Can you aggregate, analyze, mine and report on social media data today?
• What will you do with what you learn?

 

The Coming Battle Over Social CRM

There’s a colossal social CRM battle shaping up. Software conglomerates will face-off against start-ups as both use big data strategies and big data infrastructures to mobilize friends, fans and followers in more sophisticated and more personal ways. 

The big guys, Oracle, Adobe and Salesforce.com, bought up the first round of start-ups like Vitrue, Buddy Media and Wildfire, who pre-built social media applications and paved the way for thinking about how to identify, engage and stimulate brands’ fans. E big CRM dogs offer so-called “complete” solutions that link social activity to data marts and layer on BI tools, rules engines, campaign management systems and loyalty programs. Their sales guys are hawking end-to-end solutions that integrate social participants into a larger CRM universe. 

Second round start-ups like SocialWhirled, Checkd.in or Shoutlet, focus exclusively on social media. They intend to help brands figure out who their fans are, what they really care about and develop personalized ways to engage them that lead to sales, advocacy and measurable ROI. They use APIs to suck out consumer data. By data mining the take, they create segments and distill actionable intelligence to create resonant promotions or lead consumers through a purchase path. Many use rules engines to time or trigger communications. Some link or can bolt-on loyalty programs. Still others can import or export data to traditional CRM platforms like Oracle, SAP, SQL or SAS. 

The common objective is customer insight. Conventional CRM wisdom is that the more data points; the better. The big guys offer what appears to be the whole enchilada -- an online-offline aggregation of purchase history, contact, campaign and response history, web traffic, mobile usage, social activity and even geographic location. 

The upstarts offer social data and social activity with the promise that these data sets can be married to others but more importantly they can drive real-time communication through pre-fabbed digital, social, mobile or location-based apps or messaging. 

Both sides will provide software-as-service (SaaS), secure cloud storage and consulting help. Most will provide ways to analyze the data or dice and slice on-demand. 

The key to handicapping the battle and to making smart social CRM decisions will turn on the answers to six critical questions, which will be unique for each brand: 

• What are your business and communications objectives for social media?
• What role does social media play in your marketing mix?
• How important is a “whole customer” view?
• How do you collect, aggregate and use customer data now?
• Can you analyze, data mine and report on social media data today?
• How will you harvest and apply data-driven insights?