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Tag: market segmentation

  • The Best “Big Data” is The Invisible Kind

    The Best “Big Data” is The Invisible Kind

    Anyone who hasn’t listed their domicile as “rock, lower level” in the last five years knows that the biggest mega-trend in marketing is “Big Data.” As with most of these media-dubbed monickers, this means different things to different people, but in general, “Big Data” refers to the use of customer information, some of it public, some of it mined from social media, some from transactions, appending services and overlays, to market more effectively to those customers. We’ll use that loose definition here as a basis for discussion.

    Most consumers see evidence of big data in use either in their mailbox or their e-mail inbox. Personalized postcards, membership cards, letters, e-mail messages etc. are visible evidence that big data is in use. For better or worse, this type of evidence is really just the tip of the iceberg when it comes to data, and can indicate a less desirable and more clumsy approach to data use. We contend that the best use of data like this should be virtually invisible. It’s like the movies – if you can see how the special effects are done, the movie becomes about them and not about the story. Poor usage draws attention to the mechanics and diverts interest from the bigger message.

    Big data can be an incredibly useful and effective tool for creating an outstanding customer experience, as we’ve seen with companies like Amazon or Zappos. The use of transactional and preference data to enact an algorithm to “suggest” logical and related purchases the customer might find of interest is a tremendous customer retention tool. If I know that my transactional data is being saved and used for this purpose, I’m comfortable with that, knowing that they can only really use the information I give them. Plus, if there is a problem, I know they have a vested interest in keeping that data for longer periods of time, and keeping it accurately and privately. I can reference an order and have a really good chance of them being able to access their records, see what the problem is, and correct it immediately – the data and it’s access empowers their customer service staff to solve problems quickly and completely.

    For outreach marketing, lead generation, membership recruiting and the like, the use of big data gets trickier. You may or may not have any transactional data to use, so often the underfunded marketer falls back on extensive and repeated use of the data they have, by over-personalizing their outreach materials. It’s like the insecure guy trying to prove how smart they are to the pretty girl, it looks obvious and a little desperate. If I receive a piece of correspondence with my name or address liberally sprinkled throughout the piece, I get the feeling they don’t know me and are trying to fake it.

    Brilliant use of big data is unseen by the recipient. Big data is behind the fact that you are receiving the message at all. But that’s just the beginning. Modern computing power is such that each message can be customized to the recipient in a vast array of ways, either printed or digital. Keying photographs, imagery, copy, messaging, offer and other elements to appended data makes for a powerful and effective marketing punch that gets results. Outreach marketing is about triggering an emotional response, and one thing we know reaches our emotional triggers is things we’re familiar with and comfortable with. Seeing an ad served to you on your favorite social media platform from a site you recently did some shopping with shows the marketer’s hand, but is effective because you’re familiar with the shopping site and know how it happened. A personalized postcard for a national swimwear marketer with my name all over it, featuring beach clad models sent to an address in Minnesota announcing a sale in February is not likely to resonate as well. The data could have been used to swap out the image for one of Eskimoes in swimwear, and change the headline to “Coming Soon. . . ” just based on the zip code and the date. Let us know you at least gave us a moment’s thought . . .

    The best bet is to put yourself in the shoes of the recipient as effectively as possible, for as long as possible, and to use the data to effect the outcome, not to show you have the data. Use that data you have cleverly and wisely, rather than show how much data you have. Show us you thought about us, not that you know about us. Invisible data speaks the loudest, and contributes the most to the bottom line.

  • Vertical Marketing Strategy – Are you Barking (Up the wrong tree) ?

    Vertical Marketing Strategy – Are you Barking (Up the wrong tree) ?

    Owen Ashby hit it on the head with this, we’ve seen this happen in bigger companies who are finding they need to spur new growth to keep up with the curve. Too perfect, no need for me to paraphrase, so here’s the original post in it’s entirety . . . enjoy!

    November 30 owenashby

    There was a time when all B2B marketing was horizontal and I don’t mean at the Christmas party (!).  Companies designed their value propositions to address needs they had identified in organisations of a certain size in a certain geography. There it stopped.

    Then someone sold the product or service to a Bank (for example). Everyone was delighted but not surprised because that particular bank had the exact needs the company had identified its product or service could address.

    Then some bright spark suggested that actually if they had one bank as a customer, surely other banks would “peer reference” (follow one another) and so the company should now try to sell to all banks.  To do that they would need a “Bank’s” sales force (and P&L) and probably a “Bank’s” proposition too. Of course with that would go a “Bank’s” sales target and the hope and dreams of the shareholders as  the company would surely be “the number 1 provider to Banks” before the year was out.

    Only it didn’t work out like that, by year two they had still only had one bank. The sales team had, had to focus elsewhere and the marketing team were at a loss. Which was annoying because the company had built its entire organisation like this. Now as well as a “bank” sales team it had a “retail” team (because they’d previously won a high street travel agent) and a “transport” team because they’d won a haulage company.

    Over the course of a period of three years they’d “gone vertical”. It sounded great  and each quarter they’d meet and discuss which new customers and prospects would sit in which of the new vertical teams they’d created. It was always a bit of a bun fight because they didn’t win any more banks or any more travel agents or any more hauliers. So they either created new vertical teams to accommodate each new win, or they stretched their definition of a vertical so wide ( to accommodate each new account) that the vertical became a horizontal again.

    Mmmm….

    Sounds implausible doesn’t it…?

    It is happening right now and if it’s not happening in your organization then you can bet your bottom Dollar it’s happening in the company across the street and the one next to them too. In the rush pull all the focus into a vertical market, companies are losing sight of the value of their proposition.

    One bank does not a banking vertical make.

    So what’s the point?

    Start by understanding the business issue your product or service addresses, then look for the kind of operational model that generates that kind of issue, then look for the organisations that fit that profile. You may find that large numbers of these organisations all sit in small number of market sectors in which case going vertical will be appropriate. However, there’s a really good chance they won’t and “going vertical” will make you irrelevant to the vast majority of the companies in that sector.

    If you’re not careful, you end up stretching your offering and value proposition to fit the vertical market strategy you’ve imposed…that way lies oblivion…margin and market erosion and a slow and painful death. Ironic really, when you consider you went “vertical” to allow you to focus in on a niche.

    For more on segmentation and niche marketing, pick up your copy of “The Marketing Doctor’s Survival Guide”