The New Rules of Next Generation Marketing
The State Journal
by Jeff James
April 17, 2008
In this new environment, firms that have embraced new rules for engaging customers are the ones that have risen to the top in terms of growth, customer satisfaction and return on marketing investment.
Marketing researcher and author Rex Briggs has identified that of the $300 billion spent annually in the United States on advertising, at least $112 billion can be considered wasted. No wonder CFOs and marketing departments have a tense relationship. In fact, the average job tenure of the chief marketing officer in America today is 18 months.
The old quote from retailer John Wanamaker -- "Half the money I spend on advertising is wasted; the trouble is I don't know which half" -- isn't true anymore. Through today's sophisticated research and measurement tools, we can know which half is wasted. Yet it's still being wasted.
A 2005 Association of National Advertisers (ANA) survey of senior-level marketers found that the vast majority (73 percent) said they didn't see the sales impact of their marketing campaigns. Only about 20 percent reported being satisfied with their ability to measure marketing return on investment.
What's Going On?
It's only getting more difficult. We live in an era that is much more exciting and much more difficult in terms of attracting and keeping customers. In a bygone era, there were only a few mass-market channels for getting your word out: a few TV stations, a couple of major newspapers and radio. You pulled out your megaphone, interrupted the attention of consumers and counted the uptick in revenue.
During the past decade, things have dramatically changed. Consumers rejected the megaphone and demanded a conversation. They now expect a two-way dialogue that empowers them to personalize their preferences and become more involved in the exchange. Customers now demand a relationship in which they can tune out the noise and customize how they want to be engaged by brands.
Can you blame them? Citibank's study on marketing message overload found that the average consumer (that's you and me) receives close to 3,000 commercial messages a day. Only 52 will be paid active attention, and, among those, 14 actually will be disliked by the consumer. Only four of 3,000 commercial messages are positively remembered each day. Worse yet, even when a marketer breaks through all the clutter, only 7 percent of consumers believe that "companies generally tell the truth in ads." That's a tough playing field for your marketing.
Jim Stengel, CMO of Proctor & Gamble, one of the most respected marketers in the world, stated: "I believe today's marketing model is broken. We're applying antiquated thinking and work systems to a new world of possibilities." The facts prove him right.
The Culprit
So what is to blame for our current quagmire? It started with cable television and hundreds of new channels. But today the primary scapegoat is easy to identify: the Internet. The Web has exploded the number of options by which we receive and seek information. It has fractured the megaphone and put power into the hands of consumers in numerous ways.
Found a better deal? Share it on a social networking site.
Caught a company in a lie or even a half-truth? Expose them to hundreds of your contacts via e-mail.
Want to find out which is really the best performing lawn mower? Just visit epinions.com.
In this new environment, firms that have embraced new rules for engaging customers are the ones that have risen to the top in terms of growth, customer satisfaction and return on marketing investment. The marketing megaphone -- R.I.P.
The New Rules
If the megaphone is dead, what works in the 21st century? To provide answers, three progressive marketing firms based here in West Virginia have developed a traveling executive workshop. With support from The State Journal, the Next Generation Marketing education series will visit a West Virginia city near you in May to explain how:
Marketing is a Conversation -- The imperative to build a two-way dialogue has become so important in today's Internet culture that entire brands have been built on conversations with customers. Interactivity is built into the product or service. In fact, customers often help build the product. A great example is Jones Soda -- see why at www.jonesoda.com. It begins with an open invitation to talk and a promise to listen to what you hear.
Marketing is Mythology -- What sticks in the minds of today's customers? What messages break through the clutter? Brands and campaigns based on mythology -- simple, powerful, unexpected storylines that connect to an emotional archetype shared by all of us -- are far more likely to connect and spark word of mouth. Some of our greatest brands -- Apple, Starbucks, Nike, Harley-Davidson -- have powerful stories behind them. These are stories that resonate emotionally with consumers, differentiate them from the pack and motivate fans to spread the word.
Marketing is Science -- Everything in marketing can be measured. Yes, even the creative stuff. There is no longer any excuse for skipping pre- and post-testing of almost any campaign before you launch to prove its impact or exposing its weakness. Stop wasting your budget. During the workshop series, we will provide examples to show (to your CFO's delight) that measurement is a discipline that must be built into every marketing initiative.
In the coming weeks, we will dig deeper into these new rules in The State Journal. We invite you to join your marketing peers in the dialogue and register for the Next Generation Marketing series at www.marketingconference.org.
Jeff James is the former relationship marketing director for Microsoft Corp. and the founder of Mythology LLC, a Charleston-based marketing consulting firm.
The above article originally appeared in its entirety in The State Journal.
|
