Rethinking the 6 challenges of local advertising.

Rethinking the 6 challenges of local advertising.

Sep 5, 2016 | Marketing, Small business

Local businesses only need local advertising.

Right?

Usually.

So the choice is then between local analogue adverting and digital or a mix. How do you make the choices when you are a small local business with a small marketing budget. (The reality is that every business no matter what their size faces the same choices, it is only the scale that differs.)

Local analogue advertising includes everything off line, billboards, local sponsorships, letterbox drops,  and many others. In most cases, digital becomes  a choice between Facebook and Google AdWords . Often I see business owners make a series of compromises that dilute the effectiveness of their efforts by spreading it too far, and further they do not adequately consider the varying strengths and weaknesses of  the platform choices they are making.

Creating a simple framework against which to ‘score’ the alternatives against your   objectives is useful, but there are two critical questions to be answered first:

  • What is  the objective of the marketing spend. Without a clear objective, the rest becomes a potentially costly academic exercise, so lets assume you have that one nailed.
  • Who is my ideal customer. Being able to refine your communication in whatever form it is to attract the people you want to attract is key. No point wasting communication money reaching those who do not want, or cannot afford whatever it is you are selling. In addition  understanding the behaviour so you can refine the channels you use to communicate is a benefit that   is delivered by digital tools, but that knowledge is transferrable to analogue. Recently I saw an ad in a bus on a route in the north shore of Sydney for a specialist self managed superannuation provider. Firstly adverting such a service on a bus is perhaps not the best channel, and secondly the advertiser was located in Stanmore, so any ‘local’ advantage was lost.

Following are 6 simple things to consider that may assist the choices:

Longevity.

The sponsorship of a local sporting team lasts the period of the sponsorship, perhaps longer as the kids wear the jerseys running around the park. A Facebook ad that attracts page likes can be used and reused to the same presumably interested audience,  a Google ad is gone once the budget is spent on clicks, which may be from a potential customer, a competitor consuming your budget, or a bot in the Philippines.

Remarketing.

This has become flavour of the month as digital has made it seemingly easier, by providing tools that do it on autopilot. Google offers remarketing tools that can be remarkably effective, but they can also be remarkably annoying when you are chased around the web after a casual look at a website for any one of a number of reasons not necessarily associated with a purchase. However, it is an old idea, one that effective analogue advertising has been using for  ever, often called ‘leverage’. When you spend some money sponsoring the local kids soccer team, putting your businesses on the back of their jerseys, there is nothing stopping you giving out a voucher to visit your restaurant, shop, or for a discount on your services at the games where the kids are playing, displaying your sponsorship. This is simply leveraging the investment made in the sponsorship, ‘remarketing’ to the digital mavens.

Data.

On line you  can track everything, and generate an explicit ROI on your marketing expenditure, using the numbers to refine and focus the investment. This is way harder to do using analogue media, but there is no reason you would  not be able to track the redemption of the vouchers given out at the match noted above, and steadily refining the offers you made. It is just a bit more work, and nobody ever thinks of doing it. However, the value of  the data generated by digital media is huge, so long as you make the further investment in collecting, analysing, generating the insights, then actually using the insights to direct your efforts. Most local businesses in my experience fall down in this cause and effect chain.

Collaboration.

Local businesses have a significant opportunity to collaborate way more than they do. The dress shop with the shoe shop, real estate agent with the interior decorator, restaurant with local grog shop, the list goes on. Digital media makes this a bit easier, but only a bit, you still have to agree the terms, timing and nature of the offer, and how the costs and benefits are to be shared irrespective of the media.

Generating and using lists.

Analogue channels are not good at inexpensive list building, but it can be done, and has been done forever. However, the building and leveraging of lists, either by email, targeted digital adverting, or indeed  the combination of a list with old fashioned snail mail is a channel  where digital has the goods on analogue. However, many local businesses fail to build lists and the technology to leverage them although now well known and pretty simple eludes many, leaving money on the table.

Attention & impact.

Finally, perhaps the most important parameter  for which it is hard to have some tick on a list, is the impact of your communication. Paying for an ad or offer that is not sufficiently memorable or impactful to generate an action of some sort as a result of the ad is a total waste of money irrespective of the medium. Small businesses do not spend anywhere near enough time, effort or expertise considering this vital element.

When you need a bit of assistance with all this stuff, call someone you trust, and who has the experience, as  the cost will be greatly outweighed by the benefits

 

This post was inspired by another of Hugh McLeod’s insightful cartoons that popped into my inbox, and I used it in the header for this post as well. Thanks Hugh.

Shoe-string marketing for SME’s

Shoe-string marketing for SME’s

Aug 22, 2016 | Marketing, Small business

All small and medium sized businesses struggle with the problem of not enough marketing budget. They have come, or perhaps been led to the conclusion that marketing must be expensive, and often it is,  but a bit of creativity goes a long way.

You do not have to spend a fortune to get a result, but you need to be focussed, disciplined and creative.

Some of the simple things that  every small business should have down pat

Community. Small businesses are local, part of a community, and we are herd animals that like to look after our own, so long as it does not compromise us, so be local, engage in local activities and causes, make a contribution to the social and cultural fabric of your community.

Elevator pitch. It is amazing to me how many people cannot describe the value their businesses  bring to those who do business with them in 30 seconds or less. Taking the time to craft a good elevator pitch is worth every minute.

Be vocal. Many people are uncomfortable being vocal, making speeches and presentations, but they are a great way to build profile, acceptance, and loyalty,  all of which delivers new customers to you. Being controversial can be dangerous, but we all relate to the rebels, those who have the guts and presence to say what they think, and make a noise about it, respectfully and with wit and wisdom, but nevertheless a noise. The added benefit is that when you do it well others pick up on it and spread. Nothing spreads as easily and widely as a good idea.

Collaboration. Scale is power, and can be easily built. Often mutually beneficial collaborations are relatively easily managed on a local level that are challenging on a wider scale, and they offer all sorts of benefits. If you run a fashion retailer, why on earth would you not want to collaborate with the fashion shoe retailer two doors down?

Networking. Networking works, but takes considerable  time and effort, and it not for free. Nobody likes being sold to, and while that may be the objective, going into a networking conversation with the attitude that you need to give before you earn the right to receive is always a good move. Rather than opening a conversation with the usual “What do you do..?” ask instead, ‘how can I help you?’ and see the difference. Networking enables you to build relationships, and trust.The reality is that we do business as far as we can with those we know, like and trust, and that does not happen immediately, it evolves over time based on behavior and performance.

Referrals. When you have someone else recommending you to their networks, it is the most powerful marketing you can do. Therefore not be backward is asking for referrals from those to whom you have given. Usually they will be delighted to repay some of the value you have delivered to them. Referrals however can be complicated. As the number of networking groups has exploded, the value of the referral has diminished, as there is a ‘sort of’ obligation to refer as a part of the network group process. Tied up in the referral is your own credibility. Each time you give one, you should ask yourself, ‘Would I use this person to solve this problem?”  If the answer is anything less than an emphatic ‘Yes” my view is that you should not give the referral as it is a compromise of your own credibility.

Use tools for leverage. All of the above are enabled and enhanced by the digital tools now available, but they are just tools, the principals of marketing have not changed just because someone invested a fancy digital tool. Understand how  the tool is best used, use it yourself, or if your time is better spent elsewhere, and normally it is, find an expert who can maximize the leverage the tools can deliver.

None of this costs much money, but it does take time, commitment, and importantly, a plan that is executed, measured, and improved.

Do not be bamboozled by the notion that marketing is all about branding, it is not.

Building a brand is a key part of marketing success, the foundations of a brand make for marketing success, but the communication  processes to build a brand, which is what everyone thinks about, are nevertheless just a part of the more holistic process of marketing.

 

 

 

9 reasons to be wary of marketing automation

9 reasons to be wary of marketing automation

Aug 16, 2016 | Governance, Marketing, Small business

Marketing automation is the new game in town, it builds leverage onto marketing investments. Absolutely right, and I am a believer. Scott Brinkers amazing work illustrates just how rapidly it is advancing.

Automation delivers the opportunity for huge leverage when used well.  For small and medium enterprises it offers the opportunity to look and act like their much larger competitors, and win by outmanoeuvring them with their inherent agility.

However, there are risks not being talked about very much, if at, all in the rush into the automated tools.

  1. A tool is not a strategy.

There is so much smoke and mirrors and just plain bullshit being sprayed around by the vendors of many tools that the basics risk being ignored. When you need to drive a nail, the tool you need is a hammer, not an all singing, all dancing, multipurpose expandable screwdriver. Digital tools are all driven by algorithms and logical progressions, based on assumptions. Problem arises when the tool does not accommodate the myriad of behavioural realities that occur in the real world. I am seeing automation seen as a strategy way too often, without due consideration of the context in which the tool will be used, and the outcomes that can reasonably be expected.

2. Ownership delivers leverage.

Those who ‘own’ the tool are able to use the output to further their particular perspective. Outcomes predicted by some tool often takes on a credibility greater than it should simply because somebody has done the number crunching through a tool. These things do not think, they do as they are told, so being constructively critical of outcomes that appear at odds with common sense is usually a pretty good practise. The next time I see a course of action that sits uncomfortably with my instincts being pursued just because it appears justified by some algorithm will not be the first. Getting the balance between the wisdom of experience and domain knowledge and the output of some algorithm wrong is akin to letting the kids loose on a 1000cc racing bike. Great for a while, but destined for a nasty prang.

3. The danger of complication.

Steve Jobs has been credited with the words “simplicity is the ultimate sophistication’ which is simply an extension of what we have known for ages. Einstein said (amongst many other insightful strategic observations) ‘Everything should be as complicated  as it need to be, and no more’. Automation has within it the opportunity to overcomplicate, when the simple is all that is needed. I still have (SME) clients to whom Excel pivot tables represent automation of their sales analysis, and sometimes that is all that is needed. Setting out to implement a ‘marketing stack’ in this sort of environment, with this existing level of digital sophistication will only lead to tears.

4. Business is not absolute.

The formulas in a tool are absolute, they do exactly as they are told. As noted, business is not absolute, there are multiple shades of grey all over the place, often confusing and conflicting. Digital algorithms are yet to be able to learn and apply the judgements born of that learning to a situation facing them, and indeed, in analysing adequately the situation confronted.

5. Marketing ROI.

Marketing has long suffered from the accusation, that it is all smoke and mirrors, supposition and judgement along with the long lunches, and too often the accusations have had some merit. “Where are the numbers?’ is a pretty common question when marketing is chasing its slice of the available resource pie, and in their absence, Marketing is the first to be cut in a squeeze. Now there are tools that supposedly, and in fact do deliver an ability to do reliable calculations, they are often grasped like a drowning man will grasp anything that floats by. Pity an attractive lead weight can be tarted up to look like a life jacket.

6. Financial ROI.

Implementation of marketing technology is no cheap exercise, as anyone who has had anything to do with this stuff will attest. The cost of the software is only the beginning, and the time taken to project completion usually confounds even the most pessimistic forecasts made in the blush of the original ‘let’s do it’ decision. In many instances I have seen, taking some of the money thrown away in marketing automation, and putting it against genuine customer oriented activities would generate a far superior ROI.

7. Automation for its own sake.

Automating a crap process just leaves you with automated crap. One of the most common mistakes I see is believing that an implementation will solve a problem, when in my experience, automation just makes an existing problem worse, harder to find, and more expensive to fix. Never automate until the existing processes are working seamlessly, or alternatively, when you automate, throw all existing processes out the window, and start with a completely fresh page. The danger here is that without a rigorous outside intervention those that allowed the former processes to resemble a dog-pile will be the ones writing the new routines. Usually not sensible.

8. Automation is different to decision making.

Automating can deliver information that provides the data required to make informed decisions, but cannot in itself make decisions that require judgement. At best an automated decision tree can be an ‘if that then this’ logic sequence. If ever you needed convincing of this; just look at the May 2010 ‘Flash Crash‘ of the Dow Jones. The decisions surrounding resource allocation are challenging, requiring a multidimensional view of the options that balance the relative outcomes, risks and rewards.

9. It all becomes too easy.

Let’s face it, life is really busy and stressful, so when there is an answer provided that has corporate  credibility, the easy way is to go along with it, not rock the boat, and often not run the gauntlet of questioning the status quo.

 

My thanks to Tom Fishburne for the header cartoon. You continue to demonstrate the power of the cartoon to make a serious point.

4 simple measures of Digital Marketing Effectiveness for small business

4 simple measures of Digital Marketing Effectiveness for small business

Aug 4, 2016 | Marketing, Small business

Marketing has always been a bit like juggling. Lots of balls in the air, and everything seems fine until… it isn’t.

Digital has just added significant complication, try juggling on a unicycle.

Many small businesses shy away from measuring the effectiveness of their digital marketing investments, to hard, too small to be bothered, no time. I have heard all the excuses.

Too often they do not even see their marketing expenditure  as investments, they are just table stakes, one of the costs of doing business.

Digital enables measurement of marketing effectiveness as never before.

Why should small businesses miss out? Indeed, their agility is the source of their greatest advantage over their larger rivals, as they can make decisions quickly and act on them immediately, usually before their bigger rivals have finished the first meeting to discuss the situation.

Too often the ease of measurement, lack of real understanding of what the measures mean, and easy availability of pro forma “vanity measures” such as “likes” substitute for meaningful measures that guide decision making and shine a light in the digital corners.

Digital has many paths, many options, and layers, but the common factor in all of it should be the presence of a functional and well maintained website as a focal point of activity.

It makes sense therefore to have a few simple measures of the effectiveness of that focal point.

Following are 4 that I have used effectively for clients

Registration.  It has become common practise to seek email addresses in return for some item of value. In effect this is registration. The registrant is offering you the permission and  opportunity to market to them. The simple measure is the number of visitors divided by the number of registrations. It is in effect the first step in the development of a process that can lead to a transaction, and we have all heard the cliché ‘The money is in the list’.

Activation. This can come in many forms, and is often driven by the reason for registration. For example, how many of those who register for a webinar actually turn up and listen too the whole session. Again this is easily calculated as registrations divided by the activation activity.

Retention. Once activated, how many are retained? In other words, they become active participants in the activities you have on offer. This may be purchasing after a webinar and returning for a further stage, perhaps just turning up for the next webinar, but at some point there needs to be a transaction, often offline.

Referral. How often does an active and retained customer refer others to you? We all understand the most successful marketing tool is a satisfied customer motivated to refer their networks to a product or service. This being the case, measure it.

12 common & avoidable marketing mistakes I see small businesses repeating.

12 common & avoidable marketing mistakes I see small businesses repeating.

Aug 2, 2016 | Marketing, Small business

How true is the old chestnut “those who do not know history are destined to repeat it”?

It is an unfortunate truth, but in a business environment where 75% of new businesses fail, and 61% of actively trading businesses have no employees, it may be understandable. The new ‘entrepreneurs’ come and go, many having no background in business for themselves, and little beyond an often significant functional skill that they think will lead customers to their door.

That strategy may have worked in the past, but no longer.

Being an employee is generally a lousy training to be an entrepreneur, of any type.

Following are a number of the most common causes of those failures I see, several on a disturbingly regular basis.

Funding ‘institutional’ advertising & promotion.

Most advertising I see is for an institution, or business, not for  the benefit of the customer and potential customer. The “buy from me, I am better” type advertising. Instead, advertisers should  think about every piece of communication as a piece of direct response advertising, something that requires and points to an action. Advertising should be just a media centric form of direct response, otherwise, why do it? Spending money on advertising without directing people to a course of action  is a waste.

Many will wail at that, and point to the need to build a brand. True. But it gets the order in which things happen back to front. You do  not build a brand just by advertising to attract customers/consumers, you build a brand by performing, delivering value to those who try you out, then come back again and again because the value is terrific, and in the process tell their friends. Advertising is just a tool to apply leverage to this process.

Not testing.

These days everything, or almost everything can be tested. Test so you can generate the maximum leverage for your activity. Any marketing activity costs a fixed amount of money, it is the maths of the responses that give you leverage. Spend $100 on an activity, and you get $150 back might seem OK, but if you got back $300, or $500, or $5,000 how much better would that be? The leverage you are generating from your activity is greater. Test for  the elements that will generate you the leverage, as adverting is just leverage applied in a different form.

Not having some sort of differentiator

Delivering value to your specific target audience that they cannot get elsewhere is essential.  Whatever is your key value, it has to be unique to somebody or you are just competing on price, and when you compete  on price, even if you win, you lose.

Not sufficiently recognising the value of their existing customers.

We all know at some level that is it easier to get more from an existing customer than it is to get a new one, but we still insist on going looking for new customers and to some degree ignoring the value still to be gained from the existing ones. Even if you bring them value for someone else that is complementary to what you can deliver, and perhaps clip the ticket, by bringing them that value you ensure you are  always on their radar, and they are receptive to any offer you make. This applies as much to heavy machinery and capital intensive industries as it does to the way Amazon flogs you more books by knowing what you have bought and looked at in the past, and comparing that to others that seem similar.

Insufficient customer research and understanding.

The clearer the understanding you have of your customers and  prospects needs, the  better able you are able to craft a compelling offer, negate objections, and solve their problems. Once you solve their problems they are yours forever, they will always have you on the short list, if  not be the only choice.

Do not have price as the only motivator to a sale. Winning the race to the bottom of the price curve, you also lose. When you use price as the motivator, as you might if you make a blue  and have a warehouse full of stock you need to flog, find some other way to add value. Provide a a guarantee, or assurance that this cut price is only available for a short time and then only to the most valued customers you have, there are many tried and true tactics . This puts a sense of urgency and exclusivity in the offer which obscures the discount as a motivator, so it does  not erode the full price that you need to be profitable when things return too normal.

Not making it easy to do business  with you.

We all know how annoying it is to be shunted from person to person, not  getting answers, we all hate it, so why do we do it to our customers?? Make it easy to do business with you. Often this requires that you give the decision making power to those at the front lines, those who have the first contact with the customer. Ensure they are sufficiently well trained and informed that they can answer all the questions that may be asked. How bloody annoying is it to ask a question, and be asked to wait while they go and get their supervisor! Make it easy, even fun to do  business with you, find ways to add that bit of extra value that others leave out, the little things make all  the difference.

Not being transparent and answering “Why‘.

‘Why does this cost more than the opposition?’… ‘Because it is hand made from rare materials, not some imitation, or it is twice as durable, so is really cheap at the price’.  Failing to communicate your ‘Why’ is a grave failure. If you have lots of inventory, and want to get rid of it quickly, as often happens in many forms of  retailing, tell them why, that this is a one time only limited to available stock offer, created  by your buying ability with your suppliers. Tell them why, is a very powerful tactic in selling.

Not being persistent 

When you have done the work, be prepared to stick with it, and not change tactics mid stream just because there is a bump in the road. Strategy is about the long term. When activities are consistent with the strategies and add to the long term, be prepared to hang in there, and not be seduced by the newest shiny thing that comes along and seems attractive, Most businesses get tired of their own marketing well before the market does, so stick. An old boss of mine used to say that consumers were just getting to see our advertising about the time we were getting sick of it, and that is so true. Stick with what works, vary the tone and tactics to keep it fresh and new as necessary, but stick to the strategy.

Lack of focus. Any sort of activity should be directed at a specific target, the more focused the better. When others see it and act on it, great, but the clearer the focus on a benefit to a target customer you have the better. This clearly requires that you have a very clear idea of the ‘where what how and why’ of your ideal customer, but without that you are just spraying messages and hoping they hit something that looks like a prospective customer, rather  when focusing on one and ensuring that you are adding value to them.

Not educating your customers.

Never sell to customers, educate them to the benefits they will see by the use of your solution to their problems and opportunities. By setting out to add value to your customers by educating them, you can earn the right to have them buy from you. The old fashioned hard sell rarely works any more.  Instead, educate, appeal to their emotions, and show them the benefits, as did Don Draper in this Man Men classic.

lack of understanding ‘lifetime customer value’.

In most markets, customers are customers more than once, so understanding the arithmetic supporting the value of your customer is crucial. If you spend 150% of the first sales value to acquire a customer who then stays on for a further couple of  sales that cost you little to get, you are way ahead. Never burn off a customer once you have them by failing to live up to expectations. Over-delivering to customers is always a great strategy, and maximises the lifetime value.

Ignoring the value of Social media.

Social media is deceptively hard to get right, and getting it wrong can be a disaster. However, every business should be leveraging the potential power of Social media, recognising the downside. The help of the 14 year old down the street can be useful, but it can also be hugely misleading, and potentially commercially dangerous.

There are many more, but these 12 are the most common marketing mistakes, but I cannot leave without adding another. Know your numbers. Failure to  understand the financial realities of a business brings more unstuck than all the rest put together.

Is technology killing advertising, and ruining our lives?

Is technology killing advertising, and ruining our lives?

Jul 20, 2016 | Governance, Leadership, Marketing

A while ago I asked the question ‘Is the net killing marketing creativity‘ and came to the conclusion that the instant gratification now apparently demanded in all phases of our lives has indeed killed creativity.

Perhaps tritely I put it down to the not so bright amongst the marketing fraternity taking the easy way out, because it was the only one they could see.

However, the question does require some greater consideration.

That technology has overtaken us is indisputable, giving us the potential for focus and reach in addition to great  performance metrics, but creativity requires more than just speed. It requires subtlety, deep understanding of those with whom you are communicating, a capacity to see yourself through the eyes of others, and a willingness to be different and take risks.

It is in these latter areas that advertising is failing, badly.

For the uninitiated, ‘Martech’ seems to have caught on as the phrase of the moment, very intelligently pushed by my colleague Scott Brinker on the Chief Martech blog.

A subset of the Martech environment is the ‘Adtech’ tools, which have automated advertising, the most obvious but far from the only manifestation of creativity. Whether it  be on line or in an analogue environment, only the means of delivery has changed, not the need to engage, entice, intrigue and advise readers.

The ad industry has certainly been damaged, although great swathes of it have just got what they deserved, being mediocre purveyors of wasted investment, and unwilling to see the writing on the wall, although it was their wall.

The technology has been abused, and consumers have turned off it all, and the evidence for  that is everywhere.

Over 400 million people, 22% of smart phone owners use ad blockers to insulate themselves from advertising, and the number is currently higher on desk-top devices.

Web advertising has evolved quickly into the digital version of the crap that fills your letterbox, direct response, discount coupons, price promos, untargeted rubbish. Where is the recognition that advertising has a higher purpose, it is an investment in the long term, things called ‘brands’.

Remember them?

And as for advertisers, they are slowly waking up to the fact that up to 40% of their ads are being seen only by robots, and last I looked they do not buy much. In addition, the media placement is now often done by so called ‘programmatic buying’ which is a way of removing the insight and intuition of people from the process, saving money and pocketing the difference. While sellers tout the value of programmatic buying, and in some circumstances it does have merit, the major benefit is their pockets, not the advertisers marketing outcomes.

More fool the marketers I guess, they are getting what they deserve.

I will show my colors here, as little investigative reporting as we have come to know it being done in the digital space. Where would Australians be without people like Kate McClymont of Sydney’s SMH who almost single handedly, and against great odds provided the impetus that led to the conviction of Eddie Obeid for fraud, and exposed the predation of members of the Catholic church clergy in Newcastle that led to the current Royal Commission. Google and Facebook have no interest in this sort of journalism, paid for by advertising, and benefiting the society we live in.

As for consumers, we have had our privacy thrown against the digital wall. My kids seem less concerned than me, but nevertheless, I am bothered by the implications, as well as those bloody ads for stuff I do not want that follow me wherever I digitally go.

And as for the digital security of us all, when hackers find 138 holes in the pentagon web sites, good luck with the security of your google account.