Advertising Methodology (16) - Measurement

Recalling the old adage of “you can’t manage what you don’t measure”, it is time to focus in on measurements.

Earlier in the Advertising Methodology the point was made that you have to plan and prepare to know what measurements you are going to make, and build tools to make those measurements.

Now that your campaign is in production, measurements are taken, taken again, taken again, taken again, and so on. But the purpose of taking measurements is not just to create pretty pie charts (but, hey, who doesn't like a pie chart). The purpose of taking measurements is to tune the campaign. This may reflect back on changing elements of the campaign plan – including the media, the concept, and the creative itself.

Ultimately, the campaign must achieve its desired results. If everything has been done right, then these results should equate to the goals that were set out at the beginning.

Advertising Methodology (15) - Media Buying

After it is established that the campaign should work, media space is bought. This one small line represents a lot of work. The planning and buying should actually happen much earlier in the process. But, it is at this point in the plan that the rubber hits the road, and the media space must be there. It is also the point where, if the campaign development slips, negotiations will need to be pulled off with the publishers to save the campaign.

Make sure you have a good media planner and buyer that you can trust and treat as a strong ally, and who will negotiate with publishers and other media companies to your benefit.

Advertising Methodology (14) - Testing

After building the creative, it is tested. Depending on the type of creative it may be subject to technical tests. For instance, if a web-site is built, it must be tested to ensure it meets typical technology norms such as functionality, security, performance, and so on. If the campaign is a pull-tab, it must be tested to ensure that you can’t see through it, modify it, or otherwise determine the game piece’s outcome. This test should be carried out by a test team that is separate from the development team.

The next step will be to test the ad in front of Stakeholders. Stakeholders may include employees and customers. Like a review of good art, the test at this point isn’t to see if the ad is funny or well-liked. The point is to ensure that the ad is:

• On-brand, and
  
• That the message is clear, actionable, and memorable.

Again, this test should be conducted by someone other than the team that built the campaign.

Just to reiterate (because it is really important) ... the point of testing isn't to see if people like the ad. A good point here is that it is well documented that advertising that is funny (i.e. well liked) isn't advertising that is easily recalled.

Advertising Methodology (13) - Preparing for Measurement

While the Creative is being built, the Measurement tools also must be built. Measurements may come from a variety of sources including web statistics, sales statistics, customer surveys, and so on. This is the time to dig in, figure out how to measure the results, and build the methods and score-cards to catch the results.

Advertising Methodology (12) - The Creative Process

From this point, the Advertising Campaign enters a Development Realm. The project takes on a distinct creative flare. The Creative Team looks to the strategy work done to date, and brings in previous campaigns and the brand standards to start building the campaign’s Concept.

The Concept will be vetted with the client. This is often a very passionate moment for the client and the Advertising Agency. If the Concept survives this trial at all it may be chewed up and spit out as a sad semblance of its former self. How do you avoid this trauma? There are two tasks that the Advertising Agency has. First of all the Concept shouldn’t be a surprise to the client. The Agency must socialize the Concept with the client throughout its development. Secondly, the Agency must constantly evaluate the Concept against the Advertising Plan and everything that went before it.

The Creative Build may be a relatively long and complex process, and can include everything from writing copy, to shooting & editing commercials, to animating banner ads, to setting up landing pages, to building interactive games, to recording voice-overs, etc., etc., etc.. If the creative involves integrating with a client’s systems – like their web-site, transactional systems, CRM systems, and so on – then the appropriate IT or similar teams from the Client should be closely involved in the development of the system.

Advertising Methodology (11) - The Advertising Plan

Having done all of this research you develop a deep understanding of the company, its products, its customers, and its brand. You also understand the consumer, how they perceive the brand and learn about the product, and how and where shop. Most of all, you get a really good understanding of the bottle-necks and challenges that will prevent a campaign from achieving its objectives. This should lead you to be able to put together a really good first draft of the advertising plan, which will include:

• What are the goals? What does the company need to say to the customer? What is the message?
• How will we reach those goals? What will we do, and what will it cost?
• How do we measure results? How do we determine whether we have accomplished our goals?
• What is the media strategy? What is the best “place” to reach the target market?
• In addition, the Advertising Plan should include the “Plan B”. That is, once the Campaign is in market, and measurements start to pour in, the “Plan B” reflects actions that may be taken if the Campaign is not achieving its objectives.
• Note – by describing the brand, target market, etc., the plan will recognize the expected campaign media but should not dictate the creative. While there may be some assumptions about the creative, the plan should not limit the creative (other than by budget and other practical or relevant dictated constraints). The plan frames the brand, the goals, and how to reach the target market.

Advertising Methodology (10) - The Message

At this point you can define the message that the company is trying to deliver to the customer. This isn’t anywhere near the copy of the ad. It is an important input to the creative process. You have to know that the creative team is getting excited to go crazy with ideas, and this message is a key ingredient to ensuring they head off to do the right thing. The message needs to be a concise and objective document that the creative team can use to understand the salient points you have learned about the company. In that light, the message must include:

• The brand expression
• The audience
• The information the audience needs to hear
• The action that the company wants the audience to take

Advertising Methodology (9) - Purchase Channels

So, now you know what you are selling, who the customer is, how they shop, and what their options are. Now you need to understand the point where a customer drops their money on the counter and buys the product.

• What are the channels?
• How do the channels perform (sales, profitability)?
• What responsibilities does the company have to represent or support 3rd party channels?
• What responsibilities do 3rd party channels have to support the company?
• How or what advertising are the 3rd party channels doing?

Advertising Methodology (8) - Competitive Analysis

Now it is time to understand the competitors. What options are available to the Target Market?

• Who are the direct competitors?
• Are there other substitutes?
• What are their strategies and brands, strengths and weaknesses?
• What are their market shares?
• Where and how are they advertising, and what are their campaigns?

From this you can determine what the sweet spot is to advertise against your competitors. How and who will you pick a fight with? What is the unique thing that you can claim your product / service is the "only" one?

Advertising Methodology (7) - Media Influences

The next step in conceiving and creating great advertising that works is to learn about where the customer looks for information. If your ad is going to get the prospect’s attention, generate interest, make the prospect desire the product, and get the prospect to take action to buy the product … then your ad better be where the prospect is going to be looking. In that light, you need to learn:

• What media does your prospect spend their time with?
• What media does the customer turn to in their purchase funnel? Who or what media do they trust?

From this you may find that your best ad is no ad at all. Maybe you learn that your new strategy should be an email to existing customers, a viral campaign or something else.

Advertising Methodology (6) - Purchase Funnel

Closely related to the Target Market is a need to understand how the consumer buys the product. How do they choose the product they are going to buy and where do they look for information? Looking at a simple sales funnel model, it is important to understand how a member of the target market moves from being a prospect to a customer.

• What is the purchase cycle for this product?
• Who is involved in the purchase cycle?
• How long is the purchase cycle?

You might even consider a trip to a point-of-purchase to observe the shopping behavior.

Advertising Methodology (5) - Target Market

It is now time to learn about the Target Market. Who uses the company’s product, how, and why? What is the benefit to the consumer? Who is the consumer? How do you find the buyer?

• Digest all the research that the client can provide you
• Look for additional research from 3rd parties
• Consider performing additional research

Can you ever really know too much about the Target Market? You don't want to spend your entire project learning about who buys the product and how they use it. But be sure you spend enough cycles on this so that you are communicating with the right crowd and doing it the right way.

Narrowed Focus

It's been a few days since I posted. Apologies to everyone who follows this regularly. Thanks for following me as a matter of fact!

I've been busy working on a web tourism marketing report for a client, so I haven't had a chance to get to my blog or site.

Yesterday ... I updated Market GoGo.com.
Now I'm only focusing on three things:

• Brand Audits,
• Web Marketing (advertising, sales, & service), and
  
• Marketing Project Management.

Now, the site still needs to be made to look better and do more things ... but that's all just part of the ongoing maturity process for the site. While my focus is on the business and brand strategy behind Brand Audits, Web Marketing, and Marketing Project Management, I'll admit I'm no artist or technical wiz in terms of actually putting a site together. So, part of updating MarketGoGo.com is the journey of learning more about how a website actually goes together.

Trends for 2009: #12. The demand to build bulletproof cases to gain project funding

As economic times tighten the Accountants tend to rule the roost. It is a catch-22 in a sense, as I have already talked about previously in some of my other "trends for 2009" and random blog posts. The essence of a low-cost business strategy will help lead to long-term overall success. However, this also makes doing business challenging at times.

To succeed with starting a project in 2009, you are going to have to get it past your bean counters. This means that:

1. You will need to be VERY confident in the business benefits, and will need a good model to show how you will achieve those. To that end, you will may also need to point to 3rd party experts who can back you up on the likelihood of achieving the benefits.
   
2. You will need to have solid cost models, including IT, marketing, etc., etc., etc.. The departments that will have to spend to support your project will need to agree to the estimates you put forward, and indeed may have to sign-off on them for the CEO.
3. You will need to ensure that you build in future flexibility. With uncertainty comes the need to be flexible through the downturn, the eventual upturn, and every crazy thing in between.
   
4. You will need to have plans for substantial risk mitigation. In easier times, risks like project budget overruns or late delivery were all right given the speed that the economy was moving. That won't be acceptable in the foreseeable future.
   

What's a marketer to do in 2009?

• Spend a lot of time planning. In fact, set up cross-functional teams to help you do your planning,
• Get your teams trained in good planning methods, and
  
• Rely on standard and proven project management and financial models.

At the same time (and seemingly counter-intuitively), don't be afraid of being a Disruptor. Make your case and go for it. History has shown that being conservative in a recession isn't necessarily a good strategy. Grab an innovation and pursue it.

Will I be right? The year will tell!

• Follow this blog and watch for the next marketing trends I'm forecasting for 2009.
• Feel free to contact Market GoGo to discuss this further.

What is Market GoGo?

Market GoGo is a specialized Marketing Consultancy, based in Calgary. Market GoGo focuses on a few things that will help you to make your company more successful. Those things are strategic in nature, and focus on things that many companies just don't have the experience or the depth to do. Those things are:

• Brand Audit: A review of the "personality" of your company or a particular "brand" your company represents. It covers a wide swath of customer interactions and experiences with your brand from brand standards (signage, lettering, colors, etc.), to advertising, to customer service representatives, to your website, to your positioning statement, and so on. The goal of a Brand Audit is to help you understand your brand's assets and customer perceptions and subsequently to make decision and changes that will ultimately help you to drive more sales.
• Web Marketing and Advertising strategies: Web Marketing is all about doing five things as part of your Web Portfolio: Get prospective customers to your website, Convert prospects to customers, Up-sell and cross-sell to customers, Provide online service to customers, and Get customers to come back to buy from you again. This portfolio runs the gamut from bidding on Google text ads, to banner ads served by Advertising Networks, to mapping the web sales process flow, to researching customer behaviour on your website through analytics and customer research, to opt-in email marketing, and on, and on, and on!
• Project Management of your Strategic Marketing Projects: Marketing Project Management ensures that projects are delivered on-time and on-scope by the "delivery partner" (e.g. an IT Development Team or a Product Development Team). The Marketing Project Plan also ensures that the Marketing specific tasks - such as Communication and Advertising - are put in place at the right time.
• RFP Response for your B2B opportunity: Writing an RFP response is an arduous task. It is also one that you may not get to do enough, and consequently you aren't practiced in crafting a great response that will catch the attention of the team that both crafted the RFP and will review your response. Your response should get you noticed, and get you to the "next step" in the negotiating process.
• Aligning your Contact Center's Behavior with your brand: Most Contact Centers or Call Centers focus on technologies and practices that will drive cost-cutting through their business. For example, the use of Interactive Voice Response (IVR) systems has been lauded by the Call Center industry as a great way to cut costs. But just find a customer who REALLY likes dealing with an IVR. Wouldn't you like your Call Centre's behavior and technology to provide the appropriate brand experience that your customers expect? That's the goal of Market GoGo's Contact Centre Strategy Approach.

Contact Market GoGo to find out more about how we can help you with your Branding and Marketing.

Trends for 2009: #5. Simple Strategies ... Back to the Basics

When times were good things were easy. It was easy to get a new customer. Consequently, it was easy to ignore a customer, since there was always at least one (and likely many more) new customers waiting to take their place.

2009 brings an entirely different playing field. As an example, I heard an interview on the radio in late 2008 of a couple of Realtors. It appears that they are actually having to learn how to market and sell again. In their "good old days" all they needed was a listing and potential buyers would flock to the property to participate in a bidding war. Those glory days are long gone.

What are the basic strategies to focus on in 2009?

• Branding - What is your brand promise? How does your company support it? (Does your company support it?)
• Retail Ads - To paraphrase David Ogilvy, a good ad is one that sells your product. 2009 is not the time for airy fairy branding ads. 2009 is the time for simple and honest ads that educate people about the value of your product and scream out at them to take action.
• Customer Retention - The cheapest customer to sell to is an existing customer. It is time to revisit and work your current customers to remind them that you are a low-risk and well-known value for them (of course, I'm expecting that you really are). Reselling, upselling, and cross-selling are all ways that you can make ends meet (and maybe even eke out a profit) in 2009.
• Customer Satisfaction - It is almost like hearing the same message twice. If you are going to revisit your current customers, then you better ensure that they are happy with your product or service, and make real steps to bolster your customer satisfaction.
• Real Return on Investment - Projects you undertake in 2009 better have real and demonstrable ROI (and they better have it fast). The Accountants will be watching every project nickle like hawks (except, of course, their own International GAAP projects which will likely be "non-discretionary", unlike keeping their company in business which is, of course, discretionary ... ooops, did I write that out loud).

Will I be right? The year will tell!

• Follow this blog and watch for the next marketing trends I'm forecasting for 2009.
• Feel free to contact Market GoGo to discuss this further.

Expect Failure but Plan for Overwhelming Success

The internet is a neat place. It is pretty simple to dream up new concepts and create new things provides. Or maybe you mashup some existing concepts and create something new. Revolution, evolution ... change!

But, the internet is also a tricky place. There is no guarantee of success. You might believe that you have THE neatest concept and it might be put together brilliantly. But, if no one visits it and if the people who visit it don't like it, then you are doomed to failure as a result of your concept's failure. On the other hand, if it takes off it can really take off. Your site could become a viral success and overwhelm your servers, your payment processing, your supply chain, or your customer service. Now you find that you are doomed to failure as a result of your concept's success.

When you start a Web Marketing Project you will normally start by putting together a business case. A business case is (in it's most basic form) simple math:

-(Startup Costs + Year 1, 2, 3, ... n Operating Costs)
+ Year 1, 2, 3, ... n Sales or Savings
= Net Benefit

The costs and benefits you use for the business case should be as comprehensive as possible, and should be as conservative as possible. This requires suspending your belief in your concept and attempting to be as objective as possible. If the Net Benefit is positive, then you should do the project!

A few notes:

• To be technically correct on this, you should really use a "cost of capital" and calculate a Net Present Value. You can calculate this easily in Microsoft Excel.
• For a web project, I wouldn't look out more than three years to see the Net Benefit turn positive. Two years may even be pushing it.
• Operating costs include fixed and variable costs covering everything from IT development and operations, to software licenses, to handling customer service inquiries, to processing orders, to handling returns, and so on.
• Be sure to factor in planned growth for things like additional servers, licenses, customer service costs, and so forth.

That will give you your base case. Now it is time to apply the Web Business Success Law (I just coined that phrase). It is simple ... "Expect Failure, but Plan for Overwhelming Success."

Applying the Web Business Success Law:

• Expect Failure - What if your conservative estimates are too optimistic? If you launch the concept and nothing happens, what is the worse thing that can happen to your business? Be prepared for that.
• Plan for Overwhelming Success - Alternatively, what happens if your estimates are much too conservative? If the concept takes off and you become an overnight internet success story how will you scale the business? Plan carefully for that.

What does all this mean for you? First of all, you will need to really understand your Web Strategy in order to plan the path to success for your concept. Then you will need to put together a solid Web Marketing Project Work Plan, including:

• Project Charter - Describes what the project vision is, how the project will be performed, who is involved in the project and in what roles, what the risks are and how they will be mitigated, and other similar factors.
• Project Plan - The GANTT chart which shows what will be done, task dependancies, who does what, how long each task will reasonably take, and even how much the project resources will cost.
• Project Budget - The budget describes the financial implications of the project including software, hardware, expertise, training, system maintenance and system growth over several years.

Contact Market GoGo for help with your Marketing Project.

Have you seen Hancock?

Hancock was released earlier this year and is out on video now. In summary it is a story about a down-on-his-luck superhero who has fallen way out of favor with the public. That's one way to look at it. I was more intrigued by the Branding theme in the movie. Really, the superhero in this movie is the Marketer!

As a quick overview:

• Hancock is loathed by the public
• Hancock is "discovered" by a PR consultant
• PR consultant recognizes that Hancock's brand is way out of line
• PR consultant works with Hancock to revitalize the brand
• Hancock is golden!

Want to be a Marketing Super Hero? I recommend two things you need to do to start that:

1. Watch the movie.
2. Do a Brand Audit of your own company, product, or service to find a path to becoming golden.

In today's economy, The Low Cost Strategy will Win (Part 2)

Yesterday, you and Market GoGo took some time for some deep thoughts about Porter's generic business strategies, and focused in on the Low Cost Strategy. Today, we will spend some time together thinking about the factors that make up a Low Cost Strategy, and thinking about some things you might consider for some Marketing Projects in the near future.

A Low Cost Business Strategy features tactics which emphasize efficiency, including:

1. Products designed for easy manufacturing
2. Emphasizing low-cost advantages in promotions
3. Efficient distribution channels
4. Incentives based on quantitative targets
5. Process (re-) engineering
6. Investing in technology to reduce costs
7. Standardization, resulting in economies of scale and experience curve effects
8. Tight cost controls and continuous search for cost reductions
9. Sustained access to inexpensive capital
10. Preferential access to inputs such as raw materials, components, labor, and so on
11. Close supervision of labor

• Items 1 to 4 are things that a Marketing Team is responsible for, and which it brings to Finance and Operations.
• Items 8-11 are owned by Finance and Operations they bring these back to the Marketing Team.
• Items 5-7 are things that are universally applicable.

Let's look at items 3, 4, 5, and 6. You can kill these four birds with one stone, and that stone is Web Marketing. Here are examples of each in action:

• Efficient distribution channels - What could be more efficient than the web? For a moment, consider the web exclusively as a sales channel - that is just your website and not the opportunity for advertising. Typically you have a relatively fixed cost for your website. It doesn't matter if you sell one widget or a billion. Once you scale for your sales, the cost will remain fairly consistent, and will be very small relative to the costs you'd need to spend for a similarly sized store-front or sales team. Similarly, go out and price an advertising campaign in the (dying) newspaper industry, and compare that to action-based keyword advertising on Google. The order of magnitude lower cost difference you will find in web-based advertising and the order of magnitude action difference you will find there too is boggling.
• Incentives based on quantitative targets - Imagine you are an airline, and you pay a 10% commission to Travel Agents. If you have $1Billion in sales, you'd be paying your travel agents $100 MILLION. Imaging what you could do with your website for $100 million. Now you can't replace your entire traditional Travel Agent team with your website, but you can go a long way in doing so at a substantially lower cost. Some food for thought ... maybe the budget for your web marketing should be set as an incentive! The better your Web Marketing does, the more cash is available for it do to better.
• Process (re-) engineering - To put your business on the web, one of the first actions you need to take is to map your business processes. This applies to every activity that you are putting on the web. Let's say you are going to reallocate your advertising budget from traditional newspaper and out-of-home media to that new-fangled web stuff. The first thing you should do is figure out how you conceive, create, approve, and publish your ads for the traditional world. The next thing is to look at how you will do that for the web world. Then apply those lessons back to the traditional world and cut out all the fat you can from all processes. In the end you will have processes that are aligned, and engineered for efficiency.
• Investing in technology to reduce costs - If the web isn't technology, what is? It is time to invest in fixed assets to reduce your business costs. Map out business processes for attracting prospects to your site, closing sales, upselling and cross-selling, serving customers, and getting them to come back to your store again. Then turn theses business processes into a technology road-map that will help you automate your business processes for advertising, selling, and serving your customers online.

You and Marketing Team need to get going on Low Cost Business Strategies. Contact Market GoGo to see how we can help you do this.

In today's economy, The Low Cost Strategy will Win

It is time to invest in technology and do a marketing project that will both:

• drive costs out of your business, and
  
• serve your prospects and customers better.
  

Why? Well - there's an "old" book by Michael Porter that is simply titled Competitive Strategy. In it, he talks about the three generic business strategies. Once you've read the three, you find you sit back and say to yourself, "Well, that was kind of obvious." But it is kind of like Newton and gravity. Sure, everyone knows that an apple will fall. But, making the observation and then learning from that is what gives you the advantage moving forward. So, the three strategies are:

1. Low Cost: The low cost leader gains competitive advantage by being able to produce at the lowest cost. You can sell things for the same price and have more profit, or more cash to do battle with, or win a price war and still make a profit.
2. Differentiation: Making things "special" will satisfy the needs of a segment of customers and create a sustainable competitive advantage that will make customers less price sensitive. It will also allow a producer to charge a premium. Some of that premium will need to be used to pay for the additional costs in making the product or service "special".
3. Focus or Niche strategy: The producer focuses on a narrowly defined target market. Inside the Niche strategy, a company can either focus on a sub-strategy of differentiation or low cost. Typically, a Niche strategy is adopted by a small firm.

(As a side-note, it is important that a producer chooses ONE of these three strategies only. If a firm attempts to pursue two or more of these strategies, they end up stuck in the middle and are DOOMED to failure.)

So ... let's look at this in practice. As the recession takes grip on shoppers, they are heading to the low-cost alternatives. Want to buy electronics? Where will you go?

• Will you go to a specialty TV Home Theatre store? Not likely. There are few, if any, stand-alone home theatre stores anymore. You will find some Service Providers (not even Retailers really) in the Yellow Pages who can help you out if you are spending $50k on a home theatre. Where they do exist, these Service Providers are purusing the Niche strategy
• Will you go to a big-box electronics store? Maybe. These Retailers are struggling, and while they want to be Differntiating their services, Electronics are getting much easier and much cheaper. Plus, the price concious consumer is really shopping around. And where they are finding themselves is in the Electronics department of ...
• THE LOW COST SUPPLIER. That's right, the place you are likely to end up now to buy your Electronics is Wal-Mart. Reuters reported today that Wal-Mart is about to sell an iPhone for $99. $99!. In that article they make special note of:

"Wal-Mart has been gaining market share and clout in the recession as cash-strapped shoppers seek out its low prices."

What does all this mean for you? First of all, you will need to really understand your brand, and the business strategy you are pursuing. Also, you will need to understand the maturity of your industry and your positioning in the group. Subsequently, you will need to look at how you manage your brand to gain competitive advantage in an economy that appears to be slumping for the next year or more. Finally, you will need to launch Marketing Projects that will help you achieve your Brand and Strategy goals.

Be sure to check back tomorrow for "part 2" of this post, and more thoughts about Low Cost Business Strategies, and what you can do to win!