Strategic Roadmap For Digital Marketing - An Ebook For Chief Marketing Officers
Strategic Roadmap For Digital Marketing - An Ebook For Chief Marketing Officers
Strategic Roadmap For Digital Marketing - An Ebook For Chief Marketing Officers
Copyright 2011 CustomerThink Corp. Distribution is permitted only by sharing www.customerthink.com/digitalmarketingbook. Do not post PDF on any web site or require registration to access.
Foreword
CustomerThink research finds that digital and social channels are the fastest growing methods of customer interaction. About two out of three consumers start their research with a search engine, with social networks a growing source of influence during the buying process. Advanced mobile technologies will only accelerate the digital trend and further empower customers. Todays successful marketer must learn how to engage with customers and create value for stakeholders in a complex digital world. To help you grapple with this challenge, thought leaders from the Founders Council of our DigitalMarketingOne community have written a series of articles to help you design a coherent multi-channel digital marketing strategy. Akin Arikan, the lead architect for this document, leads off with a comprehensive framework. In subsequent articles, contributing authors add their expert advice in each of these major topics. Channels: Advertising, search marketing, mobile marketing, social media marketing Techniques: content marketing, lead management, revenue performance management, customer marketing Optimization: accountability, ROI, management practices, technology strategy
Edited by
Akin Arikan Bob Thompson
Authors
Ardath Albee Akin Arikan Edward Boyd Kim Dushinski Naras Eechambadi Eric Enge Jim Lenskold Robert Lesser Tom Manning Laura Patterson David Raab Strategic Roadmap for Digital Marketing
We hope you enjoy this e-book and find it useful. Please use http://www.customerthink.com/digitalmarketingbook to spread the word about this free resource. No registration is required for access. To keep up with the latest insights in our fast-moving digital marketing world, engage with our thought leaders at DigitalMarketingOne!
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Jim Sterne Steve Woods
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Table of Contents
INTRODUCTION A Framework for Digital Marketing Strategy....................................................................................... 4 PART I - DIGITAL CHANNELS Interactive Advertising: User Engagement Drives ROI ......................................................................... 8 Search Marketing: Optimizing Organic and Paid Search .................................................................... 11
Engaging Consumers with Local Search to Promote and Persuade .................................................... 14 Mobile Marketing: Creating a Meaningful Dialogue with Your Customers ......................................... 18 Four Metrics for Social Media Marketing Success ............................................................................. 20 PART II - DIGITAL MARKETING TECHNIQUES Using Content Marketing to Build Credibility and Engage with Your Target Audience ....................... 24 Lead Generation: Digital Strategies to Create New Sales Opportunities ............................................ 27 Lead Management: An Essential Component of End-to-End Digital Marketing .................................. 30 Revenue Performance Management: Align Marketing and Sales to Optimize Top-Line Growth......... 34 Maximize Long-Term Customer Value with Customer Marketing...................................................... 37 PART III - DIGITAL MARKETING OPTIMIZATION Five Key Principles to Improve Your Marketing ROI .......................................................................... 39 Five Steps to Improve Your Marketing Accountability ....................................................................... 43 Management Performance Techniques to Guide Digital Marketing Spend ........................................ 48 Aligning Technology and Digital Marketing Strategies....................................................................... 50
Copyright 2011 CustomerThink Corp. Distribution is permitted only by sharing www.customerthink.com/digitalmarketingbook. Do not post PDF on any web site or require registration to access.
Copyright 2011 CustomerThink Corp. Distribution is permitted only by sharing www.customerthink.com/digitalmarketingbook. Do not post PDF on any web site or require registration to access.
Specifically within digital marketing, how can you accomplish this systematically and without getting sidetracked by the hype of the day or whichever digital channel is yelling the loudest? That is just what our contributing authors to this e-book aim to help you with. Together with this group of experts in the numerous niches within digital marketing, well show how the many puzzle pieces can be assembled into a strategy that supports your business. I will start us off with a framework to help you set your digital marketing strategy at the highest level. The chart below summarizes the most critical elements of a digital marketing strategy. Here is a brief description of each of the major elements. 0. Inform Digital Strategy by Overall Marketing Strategy If you havent set your overall marketing strategy yet, stop wasting your time with digital here, go back and do that first. Research your market, select your target segments and set your overall marketing mix (the 4Ps). 1. Define Digitals Mission Job number one with digital is to define how the channel should be contributing to your overall business and to the customer life cycle across multiple channels. How should the channel help with creating customers and making money? 2. Select Your Overall Digital Strategy Based on the mission that you set for Digital, you can now derive your overall approach. This includes the presences that you should prioritize (e.g. website, mobile, Facebook, etc.) and their related site types or business models, i.e. 1. eCommerce, 2. Lead generation, 3. Customer service,
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Akin Arikan
Akin, the author of Multichannel Marketing: Metrics and Methods for On and Offline Success, is a product strategist for IBMs web analytics and enterprise marketing management solutions. Akin has been working with digital analytics practitioners since 1999.
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Based on these decisions you can then derive the top five KPIs (key performance indicators) that you should manage the digital channel towards. You can also form an initial opinion on the ad channels that suggest themselves for the audience that you wish to reach. 3. Interactivity Digital still cant beat traditional advertising media on reach. Yet, digitals unique strength is interactivity. Doing Digital justice therefore means to make appropriate use of its interactive capabilities when promoting your brand and offering. Interactivity means taking promotion, which is one of the 4 classical Ps in the marketing mix, and
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expanding it by focusing on many more Ps that digital is really good at: persuasion, permission, personalization, growing net-promoters, etc. 4. ROI Measurement, Accountability, and Optimization The other strengths of Digital are measurability and testing. Put these to use towards continuous improvement. 5. Technology Strategy and Selection Finally, your use of digital marketing technology should of course be determined by the digital and interactive marketing strategies that you are going after. Strategic Roadmap for Digital Marketing
Maturity Model
It makes sense to have a maturity model as a companion to our framework so that you can score your progress against the framework. The model below provides a score for each of the five major areas (#1 -5) in the framework above. For each area, the model describes different levels of maturity at which a company may be. The lowest level of maturity gets a score of zero and the highest level a score of 3.
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As an example of using this maturity model, below is how a company might score that is really good at digital as a standalone channel but hasnt yet made the step to cross-channel
integration.
Next Steps
Thats it, as to setting your top-level strategy. In subsequent articles, members of our DigitalMarketingOne Founders Council will then add expert advice about each of the rich elements of digital marketing:
Channels (Advertising, search, social media) Marketing Techniques (content, customer, revenue management, lead management) Accountability & Optimization (marketing performance, ROI measurement) Technology strategy
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clearly aligned.
Ted Boyd
Ted Boyd is CEO and Partner at digital marketing agency 58Ninety Inc., where he has created interactive marketing strategies and solutions for clients such as Canadian Tire, Molson Canada, CTVglobemedia, OLG, Unilever, Workopolis, and WWE. He has 25 years marketing and sales experience, including 15 years in interactive marketing. Previously, Ted was President and CEO of Iceberg Media.com, President of Indigo Online and Senior VP of New Media & New Business for Young and Rubicam Canada.
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followed by a test or controlled buy with a post analysis should provide clear insights as to whether the campaign was a success. On that basis marketers can start to incrementally invest in additional executions and media properties that are driving the specific result being sought.
Additionally, in a time when click through rates have tumbled to all-time lows and the number of websites continues to skyrocket and fragment, smart marketers will increasingly be trying to distribute key functionality out into ad units themselves on the actual media sites they are running on or into social network environments where they can engage people directly. For a few examples of this thinking in action, please visit us at www.58Ninety.com.
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Search Marketing
serves three major purposes: 1. Protect Customer, 3. Harvest Repeat Customers.
Strategic Roadmap for Digital Marketing
Eric Enge
Eric Enge is a partner with Stone Temple Consulting (STC), which has been providing SEO Consulting services for over 5 years to a wide range of clients, ranging from small silicon valley start-ups, to Fortune 25 companies. Eric is coauthor of The Art of SEO book.
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2. New customers. When someone searches on a generic query (such as digital cameras) it is a clear indication that they have not yet decided to do business with a specific company. This is where new customers come from! If you can rank highly in the search engines (either organic or paid) for these terms, you can obtain your share of these and expand your business. 3. Harvest repeat customers. Even after someone has become your customer, they may still not be committed to make their next related purchase from you, and may still enter in a generic search query in a search engine.
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Ultimately, the goal is to implement a campaign that provides an acceptable or better ROI for your organization. Leading SEO practitioners can derive extremely high levels of ROI - 100% or more, for their efforts. Due to its direct response model, PPC is a more competitive area. However, PPC campaigns can yield ROI levels on the order of 50%.
Selling the Benefits of SEO in a Large Enterprise Getting Top Management Buy In for Enterprise SEO Strategic Roadmap for Digital Marketing
These tools can help you learn how to make the internal sale. Once you have done that you will have taken the first major step towards search marketing success.
Summary
As you can see there are high rewards for pursuing search marketing. It does require some upfront investment, patience, time, and ongoing investment as well. However, there are those among your competition that wont hesitate. Set yourself up to execute a superior search marketing strategy and you will create a significant competitive advantage for your business.
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Alan See
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Alan See is CMO and Vice President at Berry Network, Inc. an AT&T Company. He also serves as an associate faculty member for the University of Phoenixs College of Business & Management. He holds a bachelor of arts in business and an MBA from Abilene Christian University.
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Examples of Local Search sites Internet Yellow Pages Local-Search Sites YP.com Superpages.com Yellowbook.com DexKnows.com Google Local/Maps Yahoo! Local Bing Maps Citysearch
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Finally, mobile search on Smartphones makes it possible for consumers to find businesses while on-the-go. In addition, location-based services from platforms like Foursquare or Gowalla make it possible for a business to push a message or offer directly to a consumer who checks-in or is simply within proximity of the business. This demonstrates the growing importance of mobile search platforms as the adoption rate for mobile technology increases.
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Local search is one of the most measurable forms of marketing. An organization can measure website traffic, coupon downloads, calls, clicks or number of ratings and reviews. As with all success metrics it depends on what action the organization is trying to encourage the consumer to take.
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Keys to Success
In relation to a sales funnel, locally owned SMBs focus a great deal of time, energy and marketing dollars on ready-to-buy consumers. What that means is that they concentrate on being found when the prospect is searching for information to satisfy an acknowledged need or desire. They like to take advantage of that opportunity to quickly engage the prospect because research shows that local searchers are generally well qualified and more apt to buy. When it comes to improving local search results advertisers should consider the following: 1. Adding local modifiers to your paid search keyword list in order to localize your search program. Strategic Roadmap for Digital Marketing 2. Geo-targeting your keywords. Geo-targeting refers to the physical location of the website visitor. For example, if your company uses geotargeting and the consumer is located in Dayton, the search engine will serve up an ad for your location in Dayton. Geo-targeting enhances the customer experience by providing local, relevant information. It should be noted that effective geo-targeting requires businesses to have an accurate understanding of their trade radius. Casting too wide of a net could result in wasted advertising dollars, while too narrow of a focus could result in lost sales. 3. Feed management services. This will help ensure that your business listing information is accurate and up-to-date as the data is fed directly to the local search sites. 4. Localized landing pages. A localized landing page is a stand alone page that appears when a potential customer clicks on an advertisement or a search result link. The landing page should contain information (hours, maps, service offering, etc.) relevant to the referenced location. Localized landing pages have the added benefit of increasing organic rankings as they are often picked up by Google and Yahoo! maps and included in their local search results. Lastly, it should be noted that search, mobile marketing and social media are converging on local markets. This convergence will continue to reinforce the need for strategic integrated marketing that focuses on the consumer buying process with a goal of delivering a superior customer experience. Cross channel pollination between print, digital, and social media, as well as direct mail and TV will continue to accelerate as organizations look for ways to create greater synergy with their marketing budgets.
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Mobile Marketing is
not about sending unwanted text messages to people or simply offering discounts via the
Strategic Roadmap for Digital Marketing
mobile channel. It is about creating a meaningful exchange on mobile with your customers.
Kim Dushinski
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Kim Dushinski is the President of Mobile Marketing Profits, a marketing firm that helps local businesses use mobile marketing to get more customers. Her company helps people start their own mobile marketing business and become mobile marketing entrepreneurs. She is the author of The Mobile Marketing Handbook.
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If you already have people visiting your website via mobile devices you need to get a mobile friendly version of your website built immediately. Mobile web traffic is growing exponentially and the Nielsen prediction that smartphones will outnumber feature phones in the U.S. by the end of 2011 means that this will continue. And yes, even smartphone users with the most powerful browsers need a mobile-specific site. Mobile marketing needs to be integrated with all other forms of marketing (websites, email, phone, signage, etc.) and so as long as any other form of marketing is being utilized then mobile should be engaged.
Keys to Success
Proactively and aggressively marketing your mobile campaigns is the best way to improve your returns. If you launch a text message campaign then you need to incorporate the opt-in process in every other type of marketing you do. It needs to go on your website, in your emails, on your voice mail, in your place of business, on your business cardseverywhere. When you build a mobile friendly version of your website, tell everyone. Put a link to it from your main site. Announce it in your radio commercials. Have your staff tell all your customers. It cannot be emphasized enough that the marketing you do for your mobile marketing will ensure its success. To learn more about mobile marketing see http://www.mobilemarketingprofits.com or follow me on Twitter at www.twitter.com/KimDushinski.
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Jim Sterne
A consultant and speaker, Jim Sterne focuses on measuring the value of the web to create and strengthen customer relationships. Sternes seven books include Social Media Metrics. Sterne produces the eMetrics Marketing Optimization Summit and is the founding president of the Web Analytics Association.
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invested in learning about the online world through trial and error. Then as now, its valuable to make your mistakes when there are fewer people watching and the learning curve is not so steep. A few resources spent over time will yield more knowledge than those same resources spent all at once, trying to play catch-up. Whether youre working in a business-to-consumer market or are strictly a business-to-business enterprise, social media can be useful and valuable at all phases of the customer life cycle as it allows prospects and customers to put a more human face on the organization. Spokespeople are not longer the untouchable celebrity who extol the virtues of your product on the TV screen, but are brand managers and product developers who can speak directly to individuals.
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When additional spend does not yield additional results, it may not be the spend at fault. It may be that the company has forgotten that social media is more about social than it is about media. As with all marketing, spending more money to convey a poor message will not help.
Measuring ROI
There are four main metrics for social media marketing, all of which must be considered to determine the true return; Awareness, Sentiment, Response and Value. Awareness is the same metric weve always used in marketing. Ask a random selection of people if they have heard of your product. Ask them if they can attribute any characteristics about your product. If youre doing your job, the answer will be, Of course Ive heard of KFC. Its finger lickin good! You grow awareness through reach and social media lets you reach people you might not otherwise. They are the friends of friends who read the tweet re-tweeted by those you couldnt reach on your own. Then you can segment those who have seen different ads, visited your website or participated in your sociosphere and measure the difference - or lift - in their response. There are four main metrics for social media marketing, all of which must be considered to determine the true return; Awareness, Sentiment, Response and Value. Sentiment pertains to how people feel about your brand, your product or even about you. Its great that everybody is blogging about your latest offering, unless they are deriding your efforts, tweeting about your incompetence and posting video satires about you on YouTube. Tracking sentiment across competitors and over time allows you to keep a finger on the pulse of the marketplace and divine whats in their hearts and minds. Response comes in three varieties. Did your foray into the fields of Facebook elicit a social response? Did people Like what they saw? Did they blog about it? Did they re-tweet it from the rafters? Did you get any viral action? Lots of social response? Excellent! A large check box in column A. Column B is for business related response. Did they click through to your website, download the white paper, sign up for the webinar, join the club or subscribe to the newsletter? These are standard metrics used by web teams for more than a decade. Column C gets a check mark in it when you can relate your social media activities to sales. That brings us to the fourth metric: Value. Top line sales, bottom line profits and customer satisfaction are the final arbiters of the success of your social media efforts. Did your blogging, YouTubing, tweeting and crowdsourcing generate sufficient interest to generate cash, save money on customer support or increase good will enough to make the investment worthwhile?
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Using Content Marketing to Build Credibility and Engage with Your Target Audience
Content marketing is the practice of sharing informational resources that educate a specific audience about business-critical issues, shows how our expertise can help them resolve the issues and provides evidence that we can deliver on those promises in order to actively engage those most likely to buy. Content marketing has a pervasive impact on all the stages of the digital marketing strategy framework.
Ardath Albee
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Ardath Albee is a B2B Marketing Strategist and the CEO of her firm, Marketing Interactions, Inc. She applies over 25 years of business management and marketing experience to help companies with complex sales use eMarketing strategies to generate more and better sales opportunities. Her book, eMarketing Strategies for the Complex Sale was recently released by McGraw-Hill.
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Stage 1: Define Digital Marketing Mission This stage is about setting goals about what you want your digital strategy to achieve. If you define the mission of creating customers, for example, the underlying question is just how you can use digital
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means to accomplish this level of conversion. That means content. For digital doesnt exist without content. It is during the goal stage that you must take a deep dive into the types of customers your strategy should create, come to understand their needs and priorities and how they conduct themselves within the digital environment. In essence, you must answer the who, how and why questions in relation to the selected mission(s). This information will become the foundation for your content marketing plan. Without this knowledge you cannot move further in the development of your digital marketing strategy framework. Stage 2: Derive the Digital Strategy Armed with the information you developed in Stage 1, youre now ready to determine how to fulfill your mission by selecting the core elements for inclusion in your digital marketing strategy. Once you have specified the delivery vehicles (e.g. website, social media platforms, email, etc.), prioritized your channels and metrics for accountability youll have the insight you need to determine what type of content to develop. Stage 3: Derive the Interaction Strategy Across the Customer Lifecycle Based on Stages 1 and 2, your task is to develop content storylines based on the goals youre tasked to achieve and the fulfillment components youve selected. This is the critical impact point for content marketing. In addition to consistent messaging, with digital, all components must be integrated to work together in achieving your goals. The best practice for engaging prospects and customers across the lifecycle is to map your content topics across stages from awareness to pre-purchase to customer introduction and extension. Informational needs are different at each stage. The execution tools you select will perform best with the right type of content delivering the message with the most meaning for the audience at the right time. Stage 4: Measure and Improve ROI This stage is all about measuring the performance of your content and the interactions it generated for your digital marketing strategy. Based on goals and the metrics you chose, how well did your content perform? What worked and what content fell flat? Can you identify additional opportunities for conversion based on the patterns exposed by the metrics?
Can you update the content on your website and blog, as well as create and send emails without IT assistance? Or, do you need to plan for a 3-week wait in the queue to get a new content resource coded and posted? Timing is important, so make sure you can plan appropriately.
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What are the capabilities of your email marketing tools? Are they integrated with other reporting or will you need to manually compile results from other analytics tools to attempt to prove the outcomes youve achieved? Can you build a business case for acquiring a marketing automation platform? Do you have lead and customer management processes in place that the technology and tools will support in execution? What about editorial processes and branding guidelines? Must legal review and approve content before it can be published? What resources do you have available to develop content? At what capacity?
Increased qualified lead conversion rates [70% increase reported by PivotLink] Improved ability to connect with leads they accept calls because they feel like they know the company and appreciate the value of the information received. (increase of 200% was reported by Intellitactics) Higher contract values have been reported as a result of using content to nurture leads by providing the right information at the right time.[ increase of 450% reported by Zuora]
To improve your returns on content marketing, its critical to monitor and measure response to content across the buying process. Figure out what works and what doesnt and then produce more of the content that shows the best results. Keep tabs on your buyers, prospects and customers and make sure you shift your content in parallel with the changes you monitor in their behavior. Never stop listening and applying what you learn to content development.
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...digital lead
generation for the complex sale plays a influencing prospects before and after the initial sales contact.
Strategic Roadmap for Digital Marketing
large role in
Robert Lesser
Robert Lesser is the founder and President of Direct Impact Marketing, a provider of on-demand inside sales, telesales enablement tools and direct marketing services. Prior to stepping out as an entrepreneur, he held a number of marketing positions at Dell, IBM, Reckitt Benckiser and Loblaw Companies.
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Understanding of buyer behavior A strong house file for managing leads and for outbound digital marketing A clear sales model for engaging and processing leads A marketing model that is aligned with sales to generate and manage lead flow
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Christopher Ryan
Strategic Roadmap for Digital Marketing
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Christopher Ryan is president of Fusion Marketing Partners. Chris has twenty-five years of marketing, technology, and senior management experience, and is a widely known expert in business-to-business marketing, sales strategy, systems, and processes. As both a services provider and in-house marketing executive, Chris has played a transformative role in driving marketing and sales programs that achieve the desired results and create alignment and synergy between the sales and marketing operations.
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Keep in mind that 30 percent or more of C leads will eventually make a purchase, which represents a greater volume of business than the A and B leads combined. This is why it is imperative to not only put a lot of effort into closing the A and B leads but also to put equal emphasis on nurturing and qualifying the rest of the leads in your database.
Your sales cycle is measured in months, not days or weeks You have field sales or telephone reps that cannot or will not, contact all responders The conversion rate of inbound inquiries to qualified leads is low Sales reps spend a lot of their expensive time qualifying leads
The graphic below shows a simplified example of the inbound lead qualification process. By instituting this or a similar process, you can achieve much stronger marketing and sales metrics. The qualification filter can be telephone-based or web-based.
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Reducing sales-cycle times for field sales reps (due to the fact that they are now dealing only with qualified leads) by as much as 50% Reducing the cost per lead by 45-60% Decreasing the cost of new customer acquisition by 20-30% Increasing the conversion rate of inbound inquiries to qualified leads by as much as 100%
To achieve these benefits, there are few things to keep in mind. First, always follow-up promptly. In the B2B world 3-8 percent of responders may be in an active buying cycle. You need to engage with these people quickly otherwise your competition will surely do so. Second, acknowledge the inquiry and, if you are extremely busy, set an appointment to talk in more depth at a later date. This may buy you some time while letting the prospect know you are not ignoring them. Third, be persistent in your lead nurturing efforts. Dont make the mistake of stopping after 2-3 contacts. As mentioned above, it often takes eight or more contacts to close a sale.
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And, finally, dont allow optional behavior when it comes to sales lead management. Your follow-up strategy should be completely consistent and not subject to whatever else is happening in your business. For more information, visit www.fusionmarketingpartners.com or contact the author at [email protected].
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RPM is a systematic
approach to identifying the drivers and impediments to revenue, rigorously measuring them, and
Strategic Roadmap for Digital Marketing
Revenue Performance Management: Align Marketing and Sales to Optimize Top-Line Growth
Revenue Performance Management is a systematic approach to identifying the drivers and impediments to revenue, rigorously measuring them, and then pulling the economic levers that will optimize top-line growth. Really what RPM provides is an analysis framework that allows businesses to make the right investment decisions across the entire marketing and sales spectrum. Without it, making a choice between such disparate options as investing in a webinar series or hiring another sales person would be left to gut hunch or organizational politics. RPM is focused squarely on measuring and improving your results. As a discipline, it does this on three levels; dashboarding, benchmarking, and optimizing. The first of these, dashboarding, is about understanding where you are. How big is the potential audience for your message? How many of those are aware of you? Who is in your funnel? How many of those become leads? Does sales close them, and how quickly? Only with this in place, can an organization truly understand how buyers buy, and therefore what aspects of the digital marketing strategy they have in place are working, and which are not. The second component is benchmarking. RPM looks at benchmarking holistically, in order to understand and optimize performance. At the simplest level, benchmarking one campaign against another to determine which to invest in is a very valuable exercise. However, only with a proper RPM framework in place can two campaigns with slightly differing outputs be compared. For example, if comparing a search campaign to a webinar, it might be tempting to look at the simplest metric of the number of new inquiries, but each campaign is focused on a different stage of the funnel, and therefore this comparable is false. RPM provides a framework for benchmarking the campaigns against each other, so
then pulling the economic levers that will optimize topline growth.
Steve Woods
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Steve Woods, Eloquas chief technology officer, cofounded the company in 1999. With years of experience in software architecture, engineering and strategy, Woods is responsible for defining the technology vision at the core of Eloquas solutions. Earlier, he worked in corporate strategy at Bain & Company and engineering at Celestica.
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that the marketing qualified leads delivered by the webinar can be compared against the raw inquiries delivered by the search campaign. Equally valuable is benchmarking against a plan. Comparing counts and conversion rates to historicals and to revenue projections two or more quarters out allows an understanding of whether revenue growth goals many quarters into the future will be achievable, and what gaps will need to be overcome in order to achieve them. The third and final component of RPM within a top-performing organization is continued optimization. With a detailed model of the buyers buying process in place, organizations can understand where increased investment is needed, and what the likely outcome will be. Investments in search or advertising can be compared against investments in ROI calculators of sales professionals, based on each investments ability to maximize the overall revenue performance of the organization. Each of these optimizations may affect an organizations overall digital strategy, and may contribute insights that lead to major rethinking of it. However, RPM acts as a framework that allows a digital strategy, once conceptualized, to be implemented and optimized in order to drive the maximum amount of revenue for the business.
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organization is ready to begin building a high performance revenue organization through the processes of RPM.
Measuring Success
Marketing has always been a difficult area of the business to measure return on investment, and sales is only slightly easier. In complex and considered purchase environments, this challenge is magnified, as most efforts do not directly trigger revenue, they only guide buyers in the right direction. The best way to measure the overall effectiveness of your revenue engine is to measure the cost to acquire one dollar of revenue. This is the total spend on marketing and sales divided by the total revenue generated. This metric, more than any other, provides a measure of the efficiency of your revenue engine. Strategic Roadmap for Digital Marketing In addition to efficiency, high performing revenue teams also measure growth as a critical metric on the health of their businesses. Many of the best performing companies across multiple industries aggressively manage and optimize their investments into revenue. The returns on investing in RPM as a framework come from greatly increased efficiencies in sales and marketing. Weve seen leading practitioners reduce sales cycle times, increase lead flow, reduce cost per lead, increase competitive win rates, and increase sales team productivity to name just a few areas in which significant hard-dollar returns have been seen. On top of this, the clarity of understanding that can be gained in terms of where to invest allows leading practitioners to avoid making the investment mistakes that their competitors are making.
Best Practices
The key to improving your results from an RPM initiative is organizational alignment. From the executive team down to the front lines, the team must be aligned with the idea that buyers are in control of their own buying process, and the job of a revenue organization is to facilitate these buyers. At each step, RPM leaders put the instrumentation in place to objectively understand where each buyer is in their own unique buying process. Each touchpoint updates a central view of the buyer, and this view guides both how individuals are engaged with, and how they are represented in metrics that roll up to the executive teams view of the revenue process. In order to do well at this effort, an organization must be aligned in a number of ways. First, data on buyers must be seen as extremely valuable, and kept clean and up to date at every point in time. Second, the buying process must be well understood and all touchpoints within it well instrumented. Third, the processes and analytics that marketing, sales, and the executive team rely on must be driven from this understanding of each buyer.
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Making these organizational alignment changes is not simple, and is not fast, but leads to a tremendous understanding of the economic levers that drive revenue within a business.
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[Customer] value
can be defined in
different ways in different businesses it could be a revenue or sales measure, a profit or contribution measure or even loyalty or advocacy.
Naras Eechambadi is the General Manager of Quaero, a CSG solution. Quaero delivers multichannel marketing solutions that help companies build longlasting customer relationships and maximize return on investment. Eechambadi was the winner of the American Business Award for Marketing Executive of the Year in 29 and is the author of High Performance Marketing: Bringing Method to the Madness of Marketing (Kaplan Professional Press, 25).
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Naras Eechambadi
customers who are similar to the segments you are targeting for customer marketing, but do not give them the customer marketing treatment (e.g. personalized messages, triggers based on actions and objectives, etc.). Track the average value of the control group vs. the complete target group. The deviation in values over time, aggregated across the entire customer base, gives you a measure of the value created by customer marketing. This is the return on the investment that you have made in customer marketing. Does it meet your financial or strategic objectives? This measurement is often neglected by marketers and it often comes back to haunt thembecause without control groups they cannot prove that their results would not have happened without their campaigns. Strategic Roadmap for Digital Marketing A media company client of ours who is a leading practitioner of customer marketing has been able to achieve a 250% increase in their registered visitors, 300% increase in email response rates as well as in visitor pages, a doubling of ad rates for their sites and as a result of all this their ROI on customer marketing is well in excess of 50%.
Best Practices
The key is discipline in developing meaningful measures of customer value (revenue or profitability are not always appropriate), segmenting the customer base based on value and designing marketing programs that are optimally designed to increase that value. So if your challenge is customer attrition you should not be focused on customer acquisition or cross sell, but on identifying and retaining your most valuable customers. Control groups, well designed experiments to figure what does work and what does not are also critical. Additional resources and the Quaero/CSG Systems blog are available for further reading. You can also contact me at [email protected] for questions or comments.
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Key measurements
to improve digital marketing include: Capturing incremental sales conversions and customer value to optimize the digital marketing spend.
Strategic Roadmap for Digital Marketing
Jim Lenskold
Capturing incremental sales conversions and customer value to optimize the digital marketing spend. Digital marketing has the advantage of tracking actions and behaviors but not always to the point of a sales conversion and customer value. Testing of targeting, offers, frequency, and messaging that not only improve online marketing performance but can also be implemented in broader media channels. Using modeling to understand how offline media drives online behaviors and conversion rates. Using modeling to assess the contribution of online marketing to offline sales, especially for digital content used in the research phase of the buying cycle prior to major offline purchases. Using modeling to detect the interaction effects, cross-over impact, and synergies between marketing tactics.
In addition to measurements, ROI analysis is used to prioritize digital marketing initiatives that have greater impact on high value segments
Copyright 2011 CustomerThink Corp. Distribution is permitted only by sharing www.customerthink.com/digitalmarketingbook. Do not post PDF on any web site or require registration to access.
Jim Lenskold, international speaker and recognized marketing expert, is President of Lenskold Group and author of Marketing ROI, The Path to Campaign, Customer and Corporate Profitability (McGraw Hill). Jim has published articles and presented internationally on the topics of marketing ROI, marketing strategies and business growth strategies.
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and driving conversions, identify where incremental spend can generate positive returns, provide guidance on the point of diminishing returns, and indicate where improvements in supporting the buyers purchase funnel can have the greatest impact.
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Acting on Insight
There is no question that the most important step in measuring marketing ROI is to demonstrate that you can act on insights to improve ROI. The marketing organization builds credibility by running ROI scenarios and conducting measurements that show positive ROI on current marketing initiatives; a good first step. However, marketing builds confidence within an organization when strategies or tactics are changed to grow sales and profits. It is especially important to approach ROI with the expectation of improving results since there will be some marketing initiatives that show negative or low ROI performance levels when first measured. Measurements should provide insight to improve those initiatives instead of just eliminating them in favor of new, unproven initiatives. The process of improving an organizations marketing ROI begins during the measurement planning stage. Make sure your measurements are designed: 1) with a clear plan for how the results will be implemented and; 2) to influence decisions with high profit potential, as determined by running basic ROI scenarios. Strategic Roadmap for Digital Marketing
Continuous Improvement
Measurements of marketing initiatives show ROI results ranging from very negative to levels in excess of 1000%. While it is important to generate positive ROI levels above a required threshold, it is even more important to constantly support the process of measuring and improving ROI. This discipline of constantly improving effectiveness builds confidence and credibility that marketing can deliver results for the organization. Here are five key principles for improving the returns on your marketing. 1. Run ROI Scenarios Whether you are using a very basic calculator or a sophisticated scenario planning tool, running ROI scenarios in the planning stage to quantify your expected outcomes will guide your decisions to improve the profit potential. It is also beneficial for building a case for different strategies or spending levels. 2. Prioritize Measurements Generate measurements and analytics that provide insight into financial outcomes. A good measurement plan includes a mix of basic tracking and more advanced measures. If you are seeking to expand your measurement or ROI analytics, make sure to include high impact measurements that are actionable to win support for additional measurement funding. 3. Make Marketing More Measurable When measurements are planned concurrently with marketing plans, small
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modifications to the implementation can have significant benefits for measurements. This includes setting up control groups, varying the marketing mix or spending levels in select areas, completing benchmark research, or introducing more variance in media channels to improve modeling precision. 4. Assess Incremental Conversions & Value Many touch points are working together to generate sales so the measurement of any specific marketing initiative should assess its incremental contribution. Market testing, analytics, and modeling can be used to isolate a tactics contribution within the overall marketing mix. Marketing initiatives that contribute to progression in the buyers funnel must be linked to sales conversions. Sales conversions should account for total incremental customer value, including repeat purchase, retention and growth from higher value segments. It can take time and effort to establish the measurements necessary to fully address the contribution of marketing but each step in the process provides valuable insight.
Experiment Frequently
Measuring marketing effectiveness and acting on that information in the next cycle of marketing will lead to improvements in ROI. Improvements in ROI are accelerated when the measurements are designed to not only provide insight on your current marketing initiatives, but also on alternatives that are run concurrently. This can include alternative executions such as variations in the marketing mix, analyzing performance of different target segments, introducing new tactics, or testing new offers. With a small portion of the total budget for experimentation, new insights can generate leaps in performance.
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Laura Patterson
Laura Patterson is president and co-founder of VisionEdge Marketing, which specializes in enabling organizations to leverage data and analytics to facilitate marketing accountability and operations, measure and improve marketing performance, develop dashboards, and enhance marketing and sales alignment. Laura is a frequent speaker and author of three books including Metrics in Action: Creating a Performance Driven Marketing Organization (Racom, 2009).
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Source: Forrester (Marketing Budgets: Its Time To Plan For A More Fortunate 2011) The responsibility for the systematic management of marketing resources and processes to achieve measurable gains in return on marketing investment and increased marketing efficiency, while maintaining quality and increasing the value of the corporation. Perhaps VEMs (VisionEdge Marketing) perspective will help drive home the concept. Accountability is the measuring and monitoring of the commitment a person, group, or organization makes to deliver specific, defined results. We have found that accountable marketing organizations are both accountable to the financial and strategic initiatives of the organization. When marketing examines the ROI of a program it is addressing the financial side of the equation. Measuring marketings commitment to moving the needle regarding market share growth or an increase in customer value are examples of being accountable for the strategic initiatives side of the equation. Both necessitate aligning marketing objectives with business outcomes and linking marketing to a companys financial performance.
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Notice two operative words: performance-driven and outcome-based. Accountability starts with an outcome, a result that needs to be accomplished. Marketers have tended to concentrate on outputs, the stuff we produce, and the ROI on these outputs. Best-in-class marketers are shifting from being output-oriented to outcome-based. For example, rather than reporting on the number of people who attended a webinar and the associated ROI, these marketers are reporting on the number of qualified opportunities against the expected performance target for a webinar and how many of the opportunities ultimately converted into sales worthy prospects. Performance-driven marketing organization leverage performance management techniques. Performance management is the process of measuring progress toward achieving key outcomes and objectives in order to optimize individual, group or organizational performance. VisionEdge Marketing research over the past nine years found that marketing performance management is a top priority for the C-Suite (CEOs, CFOs, COOs, etc.). The need for marketing to embrace performance management is not new. The Advertising Research Foundation study highlighted this finding back in 2000. Despite the number of tools added to the marketing arsenal, performance management remains elusive for many marketers. Why? In our work we have discovered that many marketing organizations lack the data and tools they need to measure and manage performance and those that have the tools and data often lack the analytics, metrics, performance targeting, and measurement sills. These problems will continue to plague marketing organizations until they focus on and acquire the analytical approaches and skills, the right data and data collection processes, and the right measurement skills and tools. Most importantly accountable marketing requires develop meaningful action based measures and metrics. This years study by Unica (now part of IBM) found that turning data into action, measuring results and effectiveness remain among the top priorities for marketers.
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marketing processes and improve marketing performance. Assess the crucial data, analytical and measurement skills your team needs and provide training. 2. Create and adopt a performance measurement and management strategy, system and metrics and measurement framework that aligns marketing with the business outcomes. Design and select metrics and clear standards of performance that enables marketing to measure its impact, effectiveness, efficiency and value. Its important to understand the select the right metrics. Marketing metrics should tie to our three primary responsibilities: acquiring, keeping and growing the value of profitable customers. Therefore the metrics we select should in some way indicate the impact marketing is having on market share, customer value, and customer equity. Strategic Roadmap for Digital Marketing 3. Engage the leadership team and form strategic partnerships with an extended team of finance, IT, sales, service, etc. In 2005 the Tuck School of Business facilitated an executive roundtable with nearly 20 CFOs and CIOs from some of the largest companies in the world, including Cisco, IBM, Eaton, Whirlpool and Citigroup. Why? Because CFOs and CIOs along with other members of the C-Suite have increasingly become key partners in a variety of initiatives critical to business success. Performance management is one of these critical business initiatives. CFOs often lead the internal discussion about metrics and performance management. CFOs are also taking the initiative to develop standard, consistent measurements that focus on leading indicators of value creation. CIOs and IT play a major role in creating and maintaining the infrastructure and data needed to support performance management. Marketing accountability is key to performance management. The elevation of their roles plus the leadership teams renewed focus on productivity, business value and performance management require marketing to build bridges and allies finance and IT and engage them and other key members in the marketing performance management journey. 4. Create and align processes, policies and practices that ensure the linkage between marketing objectives and programs with business results. As a result the marketing organization will be properly and strategically positioned and pulling in the same direction as the rest of the organization. Organizational development research has shown that proper alignment of people and organizations result in higher productivity for less effort. When you have achieved alignment the link between marketing project, programs and initiatives and the broader company outcomes is explicit. And each member of the marketing team understands the impact of their daily activities on the outcomes. Once you take this step you will be able to
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prioritize projects based on their value and impact rather than whats most familiar or easiest. 5. Develop a multi-level dashboard to report performance and results in real-time to facilitate course adjustments and foster decision making. Make your marketing dashboard an iterative and collaborative effort. A good marketing dashboard facilitates decisions. If your marketing dashboard doesnt enable you to make course adjustments, know what is and isnt working, and communicate the value of marketing in financial and strategic impact terms then its time for a dashboard makeover. For many marketing organizations these steps may require process and cultural changes. So marketing accountability is not a journey for the weak or timid. However, there have been enough studies over the years to suggest that by implementing marketing accountability you will be able to hold or add to your marketing budget AND you will become more effective at using marketing to drive business results.
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progressive
marketers rely on ROI directed funding for traditional channels and media, and they rely on return on objectives
Strategic Roadmap for Digital Marketing
Thomas Manning
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Thomas Manning is a partner with Ninah Consulting, a firm that quantifies and helps to increase marketing effectiveness and profitable business growth with the analytical rigor of a modeling house to address company issues, produce robust models and deliver relevant insights with actionable recommendations.
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scorecard which senior management can use to manage cross functionally and cross agency in a systematic manner. As example, a credit card company was looking to increase the business spend of their card holders in the small business category. Certain segments of that category exhibited seasonal spending characteristics for their businesses and increased spending was impacted by credit limits that assumed level, non-seasonal spending. The company sought to develop a major community group initiative for these customers with social media as the platform. Marketing was seeking significant budget to develop and maintain these community group activities. A set of cascading metrics was developed for these non-seasonal segments that included revenue improvement, partly driven by business transaction measures which in turn were partly driven by the increase in average credit levels. Strategic Roadmap for Digital Marketing Marketing recognized, however, that any promotional activities directed to those segments would be futile without participation of the risk management group which monitored and approved credit limits. A leading indicator focused on measuring the number of approved credit increases was developed for the risk management area. With this metric in place, marketing could continue to fund this effort on the basis of the risk management area meeting defined credit goals. Funding was adjusted largely based on the ongoing performance of this key activity. The end result of these techniques is a better balance of supporting organizational performance attributes that will best contribute to marketing goals. In the digital space, where strategic top line funding needs to connect to the options that are available within digital and measured at an ROO level, this technique itself can be measured as a competitive differentiator from those companies that look to efficiently marry opportunity with proper funding. Contact the author for questions or further discussion: Thomas Manning, Partner, Ninah Consulting, 1675 Broadway, New York, NY 10019, [email protected], 781-334-9973.
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Companies whose
digital strategy includes consistent, coordinated crosschannel marketing must ensure that any on-demand systems can be properly integrated with the larger marketing process.
Strategic Roadmap for Digital Marketing
David Raab
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David Raab is a consultant specializing in marketing technology and analysis. Clients have included major firms in financial services, retail, communications, and other industries. His B2B Marketing Automation Vendor Selection Tool provides detailed information and guidance to buyers of marketing systems. Mr. Raab has written hundreds of articles for DM Review, DM News and other industry publications. Many of these are available without charge at www.archive.raabassoci atesinc.com.
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Warning Signs
The technology choices must also be consistent with other parts of the business strategy. A company whose business strategy included minimal capital investment might favor cloud-based systems that can be deployed and expanded in small steps. One whose strategy depended on unique capabilities might choose to build custom systems despite the higher cost and longer lead time. The key to an effective marketing technology strategy is understanding the larger
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business strategy and making sure that the marketing systems support it on all levels. Beyond specific enhancement projects, there are warning signs that your companys core marketing technology may itself need replacement. These include fragmented data, uncoordinated responses to customer needs, and difficulty in making changes to keep up with new business requirements. The appropriate response to these symptoms will depend on your companys technology strategy. You may need to replace a large central system or simply to upgrade a disconnected component. Because new technology is often cheaper than previous versions of similar systems, this wont necessarily involve an increase in technology investment. But few firms would replace a well-functioning marketing system simply to reduce technology costs. System change creates too much disruption and risk.
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fragmentation, inefficiency, and lost opportunities. Companies whose digital strategy includes consistent, coordinated cross-channel marketing must ensure that any on-demand systems can be properly integrated with the larger marketing process. Technology is often viewed as a cost item, so the formal business case for new technology investments is often based on reductions in staff time or system operating costs. But these calculations often ignore the hidden costs of the disruption caused by changing systems. The real benefits of new technology are usually related to improvements in other marketing areas, such as better segmentation or more productive advertising purchases. While the precise benefits from these improvements are often not known in advance, its worth making a conservative rough estimate to ensure the project is likely to be worth the effort. Strategic Roadmap for Digital Marketing
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