I'm convinced that some marketers have gone out and spent $250,000 on marketing research when all they really needed to do was pick up the phone and "call mom".
It's not that spending lots of money to watch what people say & do behind 1-way mirrors isn't interesting, it's just that the entire process of conducting research can take forever - and is often overkill given your business objective.
This is where your mother comes into play. Or your father for that matter. Or your friends. Second cousins. Your garage attendant. And the guy who you buy flowers from at the corner.
The truth is that you're surrounded by people who can provide you with a wealth of input regarding the products & services that you manage, market and develop. Not utilizing these incredibly valuable resources would be a profound & deeply limiting oversight.
Now I'm hardly suggesting that you bank the global commercialization of a new product on a five-minute conversation you had with your dog walker. But I am suggesting you utilize the people around you to gather quick, "real", no-cost feedback & insights about consumer needs, your products, your company, competitors, etc.
You can also gain great insights by simply paying attention to what people around you are talking about. Take your mom, for example. What's top of mind for her these days? What appear to be her biggest 'stressors'? Are there any themes you can tease out? How about your neighbor with the newborn? How have the tone and content of your conversations changed since he became a dad?
When the need arises, I want you to turn your day-to-day interactions into one giant marketing research lab. Put on your research goggles and engage the folks within your world. They have so much to give and are often more than happy to provide you easy access to their thoughts & opinions.
Just ask your mom!.. and save all those marketing research dollars
Innovation via your inner consumer voice
All of us walk through the world with our own mental filters... our filters determine what we pay attention to and what we block out... when I walk down the streets of New York with a certain friend of mine from college, I notice all the dogs that trot past us... he notices the different architectural styles that imbue the many buildings ... for him the dogs are invisible... for me, the buildings.
However, there exists a quiet world which we both share. One all of us have in common, yet often pay little attention to... our inner voices. Those little whispers. So faint that they often go undetected. So what does this have to do with innovation? Everything.
Marketers must learn to hear their own whispers
For consumer-based marketers especially, it's essential to develop a refined ear. One that can tune into our own little day-to-day whispers -- particularly those whispers that relate to the products, services and consumer needs that underpin our businesses. It's through listening to these whispers that deep insights & innovation come bubbling up to the surface.
We all know that consumers do a notoriously poor job of communicating their unmet needs. Much of this is because most people have not developed the capabilities for tapping into their inner voices. And despite the many tools & sophisticated approaches, marketing research continues to have difficulty drawing out those unmet needs. This is why the onus falls on marketers to cultivate their own consumer inner voices.
Whether you're maniacally thumbing through a magazine in an unsuccessful search for the front-page article, or trying to figure out how to place an order at the funky new sandwich shop on your block, learning to "listen" to your day-to-day thoughts & feelings can provide tremendous opportunities for innovation. As I mentioned above, this is particularly relevant & powerful if you are also a consumer of the very products or services that your company sells.
Innovating around your inner consumer voice in the shower
Let's take a brief example of innovating around one's inner voice... there I am a few weeks ago taking my nightly shower before I go to bed. As I look down at the soap dish I notice that the soap is completely worn out - a thin slab of what was once a thick, meaty bar of glycerin. This situation is one that I have probably experienced hundreds of times in my life and yet not until a few weeks ago did I come to register the discomfort it creates. The soap was too small to be effective for washing yet it still has some useful life left. What I typically do is grab a new bar of soap and leave the old bar to slowly decompose in the soap dish, creating a soupy, soapy water concoction in the dish. For whatever reason, I cannot bring myself to simply throw away these tiny bars of just-about-unusable soaps.
It was only then, when I had acknowledged my discomfort, that I was able to think up ways to innovate around this discomfort which had remained dormant to myself for so long. Standing there in the shower I came up with a few decent concepts. One such concept was a contraption for tossing unusuable soaps into, which after getting filled-up with soaps, would act like a molding vice, mushing the soaps together, and producing a brand new bar of soap. Viola! While perhaps not a patent-worthy concept, that is besides the point.
The opportunity for innovation in the above example stemmed directly from becoming mindful of a mundane, everyday experience that generated displeasure for me, albeit not one of the 'life or death' variety. However, in today's modern world, with most of our basic needs already met, much of the opportunities for innovation lie within this 'valley of the subtle'; hence the need for marketers to refine their inner consumer voices. It is one of the key capabilities for marketers to develop in order to better identify opportunity areas for effective innovation.
Some of my favorite books on innovation
Marketers & the "us vs. them" illusion... take 3
Another helpful tool for marketers to use to further undermine the "us vs. them" illusion is as easy as a few Google searches and a couple of mouse clicks.
Open your web browser, hop onto Google or your favorite search engine, and track down some discussion boards or social networking sites that pertain to your industry and read away. You'll gain instance access to the voice of the customer, free of charge... no need for focus groups or expensive surveys.
Now, of course, I'm cognizant of the bias factors involved in this approach (e.g., reading the words of a self-selecting population). I would never suggest that a marketer take what she hears on some discussion boards and draw firm conclusions about customers - their current concerns, needs, friction points, etc. However, it's a heck of a solid way for generating hypotheses that can then be validated quickly using relevant market-research technologies.
Start doing this immediately. Block out 30 minutes a week on your calendar for "cruising" industry-relevant discussion boards. It's such a small investment, which over time will pay you back major dividends.
Marketers and the "us vs. them" illusion... take 2
As I have written about in a recent post the "us vs. them illusion" is a powerful force that blasts its way into the minds of marketers while in the workplace. Marketers entering the hallowed halls of their office buildings is the corporate equivalent of Clark Kent stepping into a telephone booth and transforming himself into a completely different person.
To reiterate the point that I made in my prior post -- marketers tend to think of consumers as "other" - as something alien to themselves that must be studied, understood, and influenced. Even the use of the word "consumer" or "customer" has an innate distancing effect, propelling the "us vs. them" mindset.
In my prior post, I introduced the Purchase Journal, a simple tool for helping marketing managers get back into the skin of their customers through reflecting on their own "consumerness". In this post I'd like to introduce another helpful tool, which I call MyFavorites.
The MyFavorites tool, as with the Purchase Journal, facilitates inward reflection , helping marketers get more in touch with their "inner consumer voices". The MyFavorites tool centers around asking oneself questions such as:
- What are my favorite brands/products/services and why?
- What are the best (worst) customer experiences I have ever had? What was it about them that made them so great (terrible)?
- What brands, stores, relationships have my full loyalty and why? Was their a particular experience that generated my loyalty, or a set of experiences over time? What was it about these experiences that helped to cultivate my loyalty?
While the above questions represent a brief glimpse at the MyFavorites tool, it should become clear from reading them that the key to MyFavorites, as with The Purchase Journal is to facilitate consumer-based self reflection. There are few more powerful skills that a marketer can develop than to seamlessly be able to ease into the skin of their customers - and MyFavorties is a very effective tool for developing such a capability.
To learn more about the MyFavorites - what it is and how to use it within your business, please feel free to contact me via email.
Related Posts
Marketers and the "us vs. them" illusion
As marketers there seems to exist a cognitive split between our work brains and our non-work brains, which I refer to as the "us vs. them illusion".
Our work brains view customers as "other"; an assemblage of abstract people whom we often glob together in our minds and try to "do things to" in order to influence their behaviors in ways that are beneficial for them as well as for the company. Under this mindset, which I have found to be a pervasive one among marketers, we forget that "we", in many ways are "them".
As a result of our inability to see ourselves in our customers, we often do not ask some of the most basic questions about the products & services that we market. For example, "would I buy my product? If so, why? When? If not, why not? What would have to happen, or how would the product have to be different for me to consider buying it?"
While it's very dangerous to project our answers to such questions onto our customers or prospects, and assume their answers are our answers, it's even more dangerous to not ask these questions at all.
As marketers, we need mechanisms & tools to help us comfortably "walk in our customers shoes", and minimize the cognitive divide that exists between our work brains and our non-work brains.
One such tool that I like to use is what I call the purchase journal. The journal helps me become more conscious and cognizant of why I purchase what I purchase; how I go about making these decisions, even the most subtle ones, such as the purchasing of a cup of coffee at Joe's deli instead of La Petite deli.
With the journal I am able to reflect on all of the nuanced and almost invisible, tiny forces that act on me and pave the way for a myriad of different purchase decisions that I make - the small ones and the big ones. I like to think of the approach as the consumer equivalent of getting in touch with your "inner consumer voice".
So what exactly is the purchase journal?
While I consider the purchase journal one of my many "trade secrets", in brief, it is essentially a log of the purchases you make over a period of time, including--most importantly--the reasons behind your purchase decisions.
As you build your purchase journal, you'll begin to tap into your "inner consumer voice", and in the process become a more mindful consumer. Buddhist analogies aside, as you cultivate this mindfulness, you'll significantly enhance your ability to move closer to "the truth" about how consumer decisions are made with a rich appreciation for the subtleties of many of these decisions.
Ultimately, this process will help you develop the skills for identifying insights about the consumers of your products - the types of insights that lead to more sustainable competitive advantage; the types of deep insights that can only be gleaned by becoming the Indiana Jones of your own consumer mind.
To learn more about the Purchase Journal - what it is and how to use it within your business, please feel free to contact me via email.
Related Posts
230 hp engine featuring Valvetronic technology, a 5-link rear suspension... huh? Focus on product benefits, NOT features!
Features, features, features... whether a product (e.g., a car) or a service (e.g., a vacation resort), it's sure to have plenty of features... bells & whistles... "goods"... "extras"...
I often find my eyes crossing as I read through descriptions of products or services. They often seem to be written for "insiders" - either people who work within the industry (e.g., car engineers, resort business managers) or the "pro-sumer" segment of the market (i.e., those consumers who are near experts when it comes to the product or service).
The challenge I find that many have within a given industry is remembering what it was like before one became an industry insider - i.e., to remember what it was like when one was simply "one of the masses".
When it comes to marketing a product or service, I find that this dynamic is one of the biggest challenges plaguing many who are in the business of marketing their products or services. The old adage of "putting yourself in your customers' shoes" is as necessary today as ever. Perhaps it is even more important given the pace at which new technologies and new products are introduced into the market.
The bottom line is that the more one lives & breathes a given industry, the more & more challenging it becomes to "put oneself in the shoes of one's customers". Industry jargon and features with non-intuitive benefits, begin to bleed into the marketing communications, leaving many consumers dumbfounded & confused.
Valvetronic technology... A 5-link/5-beam rear suspension... Does BMW expect me to know what these engineering terms refer to? I'm an average consumer with limited knowledge of cars. Words such as these make my eyes cross, and my brain hurt. They no doubt mean a lot to the engineers who developed the car; and likely to autophiles as well. But to me these terms resemble some form of early Greek. And I have neither the time nor the desire to learn a new language. My days are busy enough as it is.
So the burning question we are left with is how should BMW talk "Valetronic technology"? Clearly they're excited about it. So what should they say & do?...
CoNtEXT iS KiNg
All good marketing requires a rich understanding of context - environmental and personal.
We are always embedded in a context. The time of day; the weather; the people we are with or not with; our location - at home, at the doctor, in a store, at work; our present goals, objectives and activities; our current emotional states & energy levels... to name only a few dimensions...
When I am standing on a packed subway platform during my Monday morning commute to work, with coffee in my left hand and organizer in my right hand, I'm in an entirely different context than when I'm in upstate New York in the fall, walking through the woods with my lovely wife & our charming French Bulldog.
While I remain "Doug" in both situations, my environment and my state of mind could not be more different. While my values, beliefs & views of the world might remain relatively fixed in both situations, my needs, objectives, mental filters, and basic physiology likely diverge greatly.
In a nutshell, good marketing requires a deep, rich understanding of context. People's needs, objectives & mental filters are dramatically influenced & shaped by their environments. Given this basic tenet, marketers need to align their strategies with the environments in which their target (and existing) customers find themselves.
To give a basic example, if your main customer acquisition channel is direct snail mail, you need to develop your mailer with an understanding of the context/environment in which your mailers are likely to be viewed.
While research can help you identify the most common contexts in which people open up their mail, for the sake of this example let's say assume it's in the evening just after coming home from work. Let's also assume that people look through their mail in one sitting, and thus will view your mailer as part of quickly sifting through a stack of other mail, most of which will be quickly identified as "junk mail". Let's take our premise one step further and assume that the process of sifting through mail is a frustrating one as people try to "separate the wheat from the chaff".
So that's the context you need to keep in mind as you develop your mailer. All of the decisions that you make about the mailer (envelope, copy, design, cadence, pieces, sizes & shapes, colors, etc.) should be made keeping in mind this context, which should heavily influence your decisions.
to be continued...
What is customer segmentation?
Like so many buzz words in business & marketing, "customer segmentation" is one of those terms that is interpreted by folks to mean many different types of things. If the word "segmentation" were blurted out in a room of 20 business people, chances are it would conger up 20 different images.
So what is customer segmentation, and how can it be used to propel one's business?
Segmentation defined
Customer segmentation is a method for grouping customers based upon similarities they share with respect to any dimensions you deem relevant to your business - whether it be customer needs, channel preferences, interest in certain product features, customer profitability, etc.
The key is for you, the marketer, to first decide on what basis you wish to segment your customers (or prospects for that matter). And, the only way to answer this question is to first determine what your objective is for the segmentation, and thus what you want the segmentation to "do for you".
Common segmentation objectives
- Developing new products
- Creating differentiated marketing communications & ads
- Developing differentiated customer servicing & retention strategies
- Targeting prospects with the greatest profit potential
- Developing multi-channel distribution strategies
A brief example: segmenting for customer win-backs
Let's say you worked for a subscription-based magazine such as Newsweek. Your boss has asked you to optimize Newsweek's retention strategy utilizing the current save tactic of sending people who have recently canceled their subscriptions (aka "attritors") 1 of 3 "win-back" mailers. This existing save tactic has been employed by Newsweek for the past 2 years, and the method for determining which attritor receives which mailer has been based largely on "intuition" (aka random selection).
Step 1: Your first step in undertaking this project would be to clearly state your objective. Your objective, as per your boss, is to optimize Newsweek's retention strategy for recent attritors. This is shorthand for saying, "I want you to maximize your return on your retention-dollars invested".
Without getting into the nitty gritty of the approach, what you essentially want to do is determine the relative ROIs for each of the 3 mailers at the individual attritor level. For each mailer, you then want to identify those attritors with high ROIs (i.e., those attritors who re-instated their magazine subscriptions after receiving the mailer and provided you with future profits that well-exceeded the cost of the mailer).
Step 2: For each win-back mailer you want to identify those attributes which the high-ROI attritors have in common, essentially creating a profile for "high-ROI attritors" for each mailer.
Step 3: The final step is to operationalize the three profiles you've created so you can use them to determine which of the 3 mailers, if any, to send to future attritors. This essentially entails implementing a process in which new attritors are matched up against the 3 profiles to determine which, if any, best describe them.
A more sophisticated approach would be to build predictive models that would calculate the expected ROI for each mailer for each attritor, and then send out the mailer with the highest expected ROI to the attritor. And, for those attritors in which all 3 mailers have negative expected ROIs you might choose not to send any win-back mailers.
Closing thoughts on segmentation
In closing, segmentation can be tricky and complex, and no doubt requires a great deal of expertise & experience. Putting in place flawed segmentation strategies can be far more detrimental to a business than not having them at all. However, when designed the right way, segmentation strategies can provide tremendous returns relative to one-size-fits-all approaches.
In future posts I will tackle some other types of segmentation strategies, including those involving new product development and portfolio management. As always, feel free to email me with any of your questions, comments or thoughts.
As always, feel free to email me if you have any questions about segmentation and how to most effectively use it within your business.
More posts on segmentation & marketing strategy:
- Segmentation and targeting
- Using the 5Ws for segmentation & marketing innovation
- Using segmentation to develop your marketing strategy
- Marketing Strategy Framework to hang on your wall
Great books & articles on segmentation:
Designing a Strategy - how should I view the world?
One of the most challenging aspects of setting a strategy at any level (whether the product level, BU, or company) is cultivating a rich, well-articulated view of the "world" -- from the super macro (what I call the astronaut view of earth) all the way down to the super micro (aka, the ground-level view).
I'm afraid that often times this development of a "point of view" (POV)--a crucial first step in the design of any strategy-- is ignored. Often instead one's "point of view" remains an unexpressed, implicit, almost pre-conscious construct which can influence "the plan" whether the individual is aware of it or not.
However, even more frequently the case, the individual never formulates a POV. Instead, he or she develops a "strategy" that is simply a composite of projects & tactics which in totality are expected to meet or exceed the financial growth targets established by senior management.