Category Archives: Marketing accountability

Marketers Sick of Web 2.0? Not So Fast

Survey results released this week from the Marketing Executives Networking Group and Anderson Analytics are getting a lot of play in the blogosphere, particularly this nugget from the press release:

Twice as many marketers are “sick” of hearing about Web 2.0 and related buzzwords such as “blogs” and “social networking” compared to last year’s survey; however, marketers still admit they don’t know enough about it.  This was evident in the results of a social media study MENG released on November 6, 2008 showing 67% of executive marketers consider themselves beginners when it comes to using social media for marketing purposes.

A couple of points here. First, only 19.4% of the 643 respondents said they were tired of hearing the term “Web 2.0” (up from 9.1% a year ago), 12.2 % said the same about “social networking”, and 11.3% cited “social media” as a term they had tired of. Not exactly overwhelming condemnation of the concepts. And it’s no surprise that the year-over-year numbers would go up, considering those terms generate an endless drumbeat of media coverage. Hell, I’m sick of hearing about/reading about/saying them myself.

What the press release and subsequent coverage of the survey overlook is that when the respondents were asked what they considered to be the most important marketing concepts, the percentages citing “word of mouth,” “social network sites,” “viral marketing,” “Web 2.0,” and “consumer generated media” all rose year-to-year. Granted, these categories did not crack the respondents’ top 10 priorities (word of mouth was #11), but it’s clear that these concepts are rising in importance, even as the buzzwords themselves are becoming cliche.

The greater concern should be whether marketers will be able to sustain any progress they’ve made with their social media marketing programs. With more than half the respondents noting that their ’09 budgets have been reduced, the tendency will be to fall back on more traditional investments like sales promotions, which are viewed as safer bets than the experimentation that goes into identifying social media strategies that really work. The sales folks will be happy, but innovation will take a hit. So even though 79% of the execs in the MENG survey said that customer satisfaction was their top priority, customers can expect to be subjected to the same hard-sell tactics that have become so annoying (and so easy to ignore). Talk about tired.

Marketing in a Downturn

This is one of those recurring theme stories that pop up every time the economy takes a dip. “Don’t stop marketing!” the marketing pundits scream, as if saying it over and over again will actually make it so.

Sure, it’s common sense that you need to continue to entice customers to buy your product or service at a time when they are less likely to do so. But the reality is, when sales are tanking, something has to give, and usually it’s the marketing budget. Why? Because marketers have the most trouble justifying their investments. (So, to a lesser extent, does IT, which is why you see similar headlines proclaiming, “Don’t stop investing in IT during a downturn!” Same message, different audience.) They’re not equipped to say, “If we stop advertising, our sales will drop X%.” By speaking in generalities, marketing becomes vulnerable to any belt-tightening effots to offset falling revenues.

Some confuse marketing with innovation. Even Ad Age, which should know better, fell into this trap with a lamebrain story on innovations spawned during economic downturns:

Retail sales have gone from slow to declining, and the consumer-spending binge that propped up the U.S. economy for years may not return for a long time.

In short, it’s a great time to be in marketing.

Previous recessions have provided big opportunities — spawning the brand-management system, soap operas, modern cable networks, airline loyalty programs, the IBM personal computer, the iPod, Crest Whitestrips, Axe body spray and — for better or worse — fast-food value menus.

It’s safe to say that the success of most of those items had more to do with the quality and uniqueness of the products than the marketing campaigns around them. I guess the takeaway is that you still want to take risks during a downturn – but the bigger point is that you have to be operating from some baseline of reality. That’s where the real marketing innovation needs to occur; if you can’t start to draw a straight line from your marketing initiatives to some economic benefit for your company, you’ll never gain enough cache to protect your budgets when times get tough. Of course, you can always fall back on sending out more coupons.


Marketing Measurement Misplay: Project Apollo Is Dead

The much-hyped “Project Apollo” consumer research initiative is dead, MediaPost reports today:

“Despite a promising level of interest, we did not secure sufficient client commitments to make Project Apollo a sustainable venture for our two companies,” Arbitron and Nielsen said in a joint statement. “We are grateful to the companies, consultants and to the marketing and advertising agency executives of the seven Project Apollo Steering Committee members who helped us explore the cutting edge of media and marketing research.”

Conceived in 2004 by Arbitron and VNU (now The Nielsen Company), Apollo was meant to provide marketers with a “single-source” measurement of media and advertising, in order to show better linkage between advertising and consumer purchase behavior. Apollo had a few significant backers, notably Procter & Gamble, but the project seemed doomed from the start, considering its high cost to implement, its reliance on “portable people meter” devices, and its focus on TV, radio, and print media, with little more than lip service paid to online channels. A 2006 pilot encompassing more than 5,000 households and 11,000 people (presumably toting PPMs around their necks) apparently didn’t do enough to convince major advertisers to sign on for a commercial rollout.

As an aside, never has a “forward-looking statements” clause in a press release seemed so prescient:

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements regarding Arbitron in this document that are not historical in nature, particularly those that utilize terminology such as “may,” “will,” “should,” “likely,” “expects,” “anticipates,” “estimates,” “believes” or “plans,” or comparable terminology, are forward-looking statements based on current expectations about future events, which we have derived from information currently available to us. These forward-looking statements involve known and unknown risks and uncertainties that may cause our results to be materially different from results implied in such forward-looking statements. These risks and uncertainties include, in no particular order, whether we will be able to:

  • successfully implement the rollout of our Portable People MeterTM service;
  • successfully design, recruit, and maintain PPM panels that appropriately balance research quality, panel size and operational cost;
  • successfully obtain and/or maintain Media Rating Council accreditation for our audience measurement services;
  • renew contracts with large customers as they expire;
  • successfully execute our business strategies, including entering into potential acquisition joint-venture, or other material third-party agreements;
  • effectively manage the impact, if any, of any further ownership shifts in the radio and advertising agency industries;
  • respond to rapidly changing technological needs of our customer base, including creating new proprietary software systems and new customer products and services that meet these needs in a timely manner;
  • successfully manage the impact on our business of any economic downturn generally and in the advertising market in particular; and
  • successfully manage the impact on costs of data collection due to lower respondent cooperation in surveys, privacy concerns, consumer trends, technology changes and/or government regulations.
  • successfully develop and implement technology solutions to measure multi-media and advertising in an increasingly competitive environment.

Single-source measurement is a critically important, yet critically complex, and therefore an extremely elusive goal of marketers. The millions of dollars wasted on Apollo won’t help the cause.

New Articles in 1to1

I have two short articles in the current issue of 1to1 magazine. One is on some of the new metrics that marketers are adopting to help them measure the performance of their online and offline programs, as well as the value of their customers. It includes a sidebar on the impressive results that Petco is seeing after adding user-generated content – a.k.a. customer product reviews – to its website.

The second looks at the expanding skill set that today’s CMO needs to survive. The big three: General management experience, a deeper grasp of new media, and an eye for talent.  

Both require registration to view.

Marketing Dashboards in Practice

An article I wrote for MarketingNPV Journal is posted here (registration required). Here’s the top: 

There’s no longer much of an argument over the need to measure marketing performance. Face it, the left-brainers have won at least the battle, if not the war. But just how are CMOs faring with their new measurement-driven agendas?

The short answer is: So far, so good. Marketing leaders point to more focused initiatives, a better handle on their investments, even improved relations with an old nemesis — finance — as a result of their marketing dashboard initiatives. But they also admit that there’s still much work to do, not just with what they’re measuring, but also in how they’re sharing those results with the rest of the organization.

Eight senior marketing executives shared their insights with me for the article: Yahoo’s Cammie Dunaway and Nick Besbeas, Home Depot’s Roger Adams, Office Depot’s Tony Ueber, KeyCorp’s Karen Haefling, Lenovo’s David Churbuck, Bank of America’s Bob Calamari, and CA’s Sean Goldstein. They discussed the makeup of the dashboards and, as imporantly, how they’re distributing that information across their companies. Money quote from Haefling, KeyCorp’s CMO, about the types of metrics to include in a marketing dashboard:

“We have learned that less is more. You need to focus on the things that are really going to make a difference in company performance, and not bean-count all the things that show you’re doing a nice job.” 

Successful marketing organizations are using their dashboards to improve their ability to make resource adjustments on the fly, as this example from Bank of America shows:

Through its performance measurement systems, BofA’s marketing team can gain greater insight, for example, in the effectiveness of TV vs. out-of-home advertising for a product campaign and make adjustments quickly toward the media that are proving more valuable.

“We’re getting more sophisticated around marketing-mix modeling and our ability to optimize various elements of marketing spend,” says Calamari. “That has opened up a whole world of possibilities to experiment with more refined degrees of spending.”

MarketingNPV’s managing partners, Pat LaPointe and Dave Reibstein, must have liked the article, because they just hired me as editor of their quarterly journal and website. I’ll still be blogging here and doing other project work, but I look forward to digging into the issues of marketing measurement and accountability that MarketingNPV addresses so well.