Strategy in the post-digital era

First came ‘shopping,’ when the shopkeeper made you feel welcome. In my local shop, Mrs Frances knew everyone by name, and could anticipate almost any request. When she was asked for something new, she listened and knew next time. It was very difficult to catch Mrs Frances out more than once. She was there to serve her customers.

Then came ’shopper,’ with aisles that were set out for our convenience. The idea was that by watching how customers behaved in a store, the owner could set the store out best to meet the pressing needs, putting the rarely-bought at the back or in the corners where you wouldn’t get in other peoples’ way while you were choosing. It was a slightly more sophisticated way to put the customer’s needs at the centre of the experience.

This led to ‘customer journeys,’ perhaps biased not in favour of the shopper but in favour of the store. Studying how customers behaved led to commercially-driven thinking about how they could be tempted to buy more, or to vary their choices. Ultimately, brands started asking for prime positions, and others created ranges to meet every conceivable need. Shopping became either a world of temptation, or an annoyance, or more convenient, depending on your value to the store. Data started to be looked at in the abstract, not the personal.

Then along came digital. It removed the shop from shopping altogether in some cases. It became a distracting obsession if I’m honest; and I speak as a digital strategist. Shops talked of the digital versus bricks and mortar future, and took fright at the thought that all industries might go the way of bookselling. FMCG brands spent serious money trying to find ways to market digitally in anticipation of the demise of the real world. It took twenty years for us to get past the notion that digital would replace shopping in shops.

But digital is not the new world. Digital did not replace real life. The digital éclair didn’t win. Digital, like all great revolutions in technology, is being assimilated. We live in a world where we shop. Where the role of every medium, analog, digital or (in the traditional sense) social, will end up just being aspects of our environment. And that presents a massive step change in the way we think of strategy as it applies to marketing to consumers. Gone are the ideas that each channel in its place, run within and by a silo of specialists, with a channel-specific goal and vision. The silos simply have no relevance in a world where a customer journey can take in so many momentary contexts, where as more are added the boundaries disappear and the marketing ecosphere becomes more democratic. 

Appearing in sharp relief once again is the customer. The new marketer has to focus on that, because to do anything else inevitably exposes massive blind spots. We are talking about viewing marketing not as disciplines like CRM, or shopper marketing, or social, digital, outdoor, PoS, but as genuinely coherent customer engagement. The goals are no longer awards, or social kudos, or reducing basket abandonment (although all of these play specific parts), the goal is coherence along the entire customer journey. It’s a new way of thinking. You can think of it as post-digital if you want to put it in (or outside) a box. But the reality in our stark new consumer-centric world is a new discipline: Total Customer Engagement. Welcome to the new era.

It's the Art of Perfectly Timed Marketing

Guest blogger – Jen Talbot, Senior Account Manager

Responsible for the day-to-day account management of some of Underwired's clients including ESPN and Regus worldwide, Jen advises on digital best practice and marketing strategy, and coordinates planning workshops for customer journey mapping.

Jen joined Underwired in July 2013 bringing with her experience from previous roles at Havas EHS in account management and project planning for both digital and integrated campaigns for brands in the financial, utilities and leisure sectors including Barclays Wealth, CPA Global and E.ON.

In an age of connectivity, where everything has become instantaneous, the sense of meaningful communication has been lost in the constant noise of notifications and reminders. So, with this being today's reality, what does this mean for the modern day marketer?

When you see a stunning rainbow or a great piece of street art, what do you do? Instagram it, Vine it, Tweet it, Facebook it? When you're out for the day how many times do you respond to texts, WhatsApp messages, emails or tweets?

Media theorist, Douglas Rushkoff, has outlined our obsession for trying to capture the moment, but never quite living in it, in his new book 'Present Shock'. He makes the point that, "The only kind of people that used to be contacted this frequently and this incessantly, were 911 operators - and they would only do it for two or three hours during the day. And then they would be medicated in order to be able to live that way".

Kronos vs Kairos 
Taking inspiration from Ancient Greek, today's marketers have two differing methods to select from, when looking to determine the 'right moment in time' for customer communication. Definitions of 'Kronos' and 'Kairos' - both Ancient Greek words for 'Time' - distinguish these methods:

1.Kronos 
Kronos means chronological or clock-driven. A marketer's version of Kronos is: "I know that by sending my newsletter on Thursday at 1pm I will get a better response than at any other time". Or "I know that by sending an email every week I will get more repeat purchases".

2.Kairos 
Kairos is the alternative sense of time, succinctly put by John Pulakos, in his 1983 article 'toward a Sophistic Definition of Rhetoric': "In short, Kairos dictates that what is said must be said at the right time." In marketing, we can interpret this as both the readiness or 'openness' for conversation, and the choice of selecting the appropriate moment.

The age of bombardment 
According to Microsoft, the average person has 184 emails in their inbox and receives at least another 28 emails each day. According to Ofcom, 49% of people regularly 'media mesh' - using devices for completely unrelated activities whilst watching TV - and an average of 500 million tweets are sent everyday.

With all this noise and irrelevance, companies are forever looking to achieve efficiencies using the Kronos method, a chronological approach to sending marketing communications. By doing a simple Google search of 'best time to send email' 1,550,000,000 results are produced. But how many companies implement this approach without looking further into their audience motivations?

When IS the right moment? 
One source suggests potential reasoning for the most successful time frames for each sector and industry. For example, the 'post work peak' (between 5pm and 7pm) is considered to be the best time to send marketing emails, in terms of open rates.

When Gmail announced the implementation of 'tabs' to its inbox, companies were concerned that response rates would go down. In fact, within the first few weeks of the update, the opposite was true and the open and transaction rates actually increased. Although rates are approaching the average again now, this uplift highlights the affect of taking the Kairos approach and the importance of having an audience that is 'ready' to view marketing emails. This 'readiness' essentially means that recipients are in more of an open mind to click through to the email and transact where relevant.

Kairos in CRM 
Readiness, or indeed Kairos, is absolutely key to CRM, as it ensures marketers are carefully considering when the audience is 'ready' to hear from your company. In so many cases, communication programmes are run on a periodic or silo basis - onboarding, newsletters, loyalty programmes, retention - all overlapping and clamouring for attention.

Let's think now about how many times a company has said 'thank you' to you for being a customer. Now let's think about how many times a company has said 'thank you' only to use this as an opportunity to cross-sell? Some might see this second option as an efficiency that their customers would appreciate. But by having a 'dual-purpose' communication you actually weaken both messages. There should be a time and a place for everything. The acceptance and desire for tools, such as the Gmail 'tabs' or Outlook's 'advanced rules', show the increasing importance for customers to control when they are ready to be spoken to. So with this in mind, a thank you should just be that; 'thank you'.

Kairos in practice 
Confused.com is a good example of using Kairos in practice. Having used the insurance search engine for a quote comparison in March, a month later - when I'd nearly forgotten about it - they sent me a birthday email. There was no sales message, just a humorous email from the brand mascot, Brian the Robot. The email immediately put me in a great mood and brought Confused.com to the front of my mind. It made me want to show my friends and it generally made me feel pretty good to be a customer. A couple of months then passed by and they nudged me again, this time about a new app that was available.

Confused.com is playing the long game as it clearly understands that it will be a year before I make another decision about my insurance. We both know that I'm not in the market right now, but in the meantime I'm being made to feel appreciated - and entertained - therefore enhancing the chances of a repeat purchase. And before I return to the website, to potentially make a purchase, I have been providing my word of mouth recommendations to colleagues and friends about the company and its great customer service.

Conclusion 
So after all this talk of Ancient Greek, where do we as marketers stand? Well, hopefully with a realisation that when juggling existing communications plans, business goals, stakeholder opinions and a disorganised or legacy database, the thought of "What does the customer want from my company?" can often fall by the wayside. But, this question should hold equal if not a greater importance than the thought of "What do I (the business) want to tell my customer?" This is because it can inform and give greater value to everything from data segmentation to communications content.

When a communication becomes supportive and not 'shouty', useful but not needy, and timely yet not thoughtless, we start to see appreciation in the form of response. Through this approach, we regain the value of meaningful communications and become able to cut through the chaos of a 'Present Shock' inbox.

Total Customer engagement: growing trend of "Total Customer Engagement" and how this is affecting the future of marketing

When I was a kid, we used to shop in the same places all the time. We'd walk down the street and say hi to the butcher walking in the other direction. He'd always have a smile, and maybe make a cheeky comment about us kids. When we went into his shop he'd comment on what veg would go with the meat my mum had chosen, and tell her to say hi to Jeoff when we went into the greengrocer's next door. There was always a kind word. For decades my family shopped in the same shops. There wasn't anything called customer engagement. But that's what it was.

Nineteen years ago the web turned up, messed up customer experience by turning it on its head, reducing the shopper interaction to seven clicks, shopping carts, price comparison and basket abandonment. Almost twenty years on, we've learned a huge amount about technology, about acquisition, about usability, great design, optimisation and the always-on mentality. Having now come out the end of e-commerce's terrible teens, here are the things we now know:

Retention only comes after acquisition

Loyalty only comes after service

Advocacy only comes after loyalty

Win-back only comes after failure

Three clicks is best, though if you have a process that takes more than ten by the time you've got the customer to seven she's unlikely to turn back and go to your competitor

Responsive design means you can make the experience similar across PC, tablet and mobile

...and so on.

What we've also started to understand is that the customer is on a journey. Over a decade, we have perfected the art of defining that journey by understanding that there is a natural sequence that doesn't feel forced if you ask the customer to take the journey with you. This in turn, is based on the idea of the nudge - that one little step at a time can lead to significant change. When we look at where a customer is, what they like, where they go and where we want them to go, we can then readily develop a map of the customer's journey from first point of contact to lifetime loyalty, in little incremental steps. 

The art of customer journey planning, which came out of the in-store retail experience and the desire to drive customers past high margin discretionary items on the way to their target staples, has been translated to the online world and perfected over ten years by the specialist eCRM agencies like Underwired and others. And this customer journey, delivered using the cheapest digital channels, has been developed to allow brands to examine each little, incremental step on its own and optimise its performance. By extension, when lots of little increases in performance are added together, huge changes in revenue can be achieved. To illustrate this, by increasing revenue by 3% for a single step, when applied over 24 steps will double your revenue. We do this all the time.

By adding a dimension of customer focus to this rather technical, commercial focus, segmentation has been taken from its shopping experience roots (for instance, when our butcher would know that because ours was a three kid family, we'd be more likely to buy mince than a steak), via direct marketing thinking, properly defined in the early seventies, to the digital age. This digital age has allowed marketers to think in big numbers, to define shopping habits not through inference, but through observing behaviours from Google search to repeat purchase in an e-commerce system. Behaviour, enhanced by adding demographic data, married to motivation (back again to inference) gives us 3D segmentation. And 3D segmentation gives us the tools to develop different customer journeys for different types of customer.

All of this you're familiar with, I suspect. Marketing is now largely scientific. We can develop customer journeys for different customer types and take them from one step to another leading to maximal (or at least optimal) lifetime value.

It's been a revolution. And the kids have grown up. Almost twenty years on since the first days of the web and the painful birth of a new way of retailing, this discipline of how to engage with customers is finally about to emerge from its teens.

So where does it go from here?

The next generation of retailing takes what has gone on up until now and builds on it. In actual fact the Next Big Thing is really simply an extension to everything  you have just read: if you look at how segmented customer journey planning has been expressed in practice, the next step in its evolution is quite clear. Thus far, we have made use of digital channels to do all of this. The web to capture attention, to engage people with the brand on the website (or landing pages), to engage and retain them using email, to convert them to customers using e-commerce.

And thus far, we've been viewing the customer journey as something we as master marketers define for our customers.

In fact, customers are on their own journey. They have lives, which are multi-threaded, which involve the web, and mobile, and walking down the street with their kids. They live lives ruled by their motivations, the people they listen to, their immediate needs, and their whims. And, critically, they are influenced by all sorts of things that aren't just digital.

The customer journey plan does work. It does have a crucial role to play - as marketers we must have a framework for holding the hand of the customer while we take them one step further: without it we don't know how to brief it to agencies, we don't know how to measure success and we don't know how to optimise it. But it ignores the fact that customers (actual real people!) have their own sequence, and they are unlikely to share it with us, even if they know it themselves.

One of the facets of this which informs what will happen next is that in real life, customers aren't just on email. They don't just use digital. Sometimes the critical nudge that will take the customer from point 16 to point 17 isn't online. We may have to reach them offline.

The customer journey requires us to think in a channel-agnostic, or multi-channel, way. The future of this marketing discipline requires us to map the customer journey without assuming it will be served at every step by an online touch-point. If we do this, the customer journey plan we describe can more closely reflect the customer's own journey and the way she actually lives her life. By defining customer engagement on the basis of what nudges and steps are required first, and then adding in channel selections based on the customer's own journey, second, we can create single-minded, focused, multi-channel strategies and campaigns. 

This is the next generation of marketing. It's called Total Customer Engagement. It gives us the tools to leverage 3D segmentation and digital insight to deliver the kind of supreme engagement previously only delivered by the local family shop keeper. 

Press release – Underwired wins Mitchells & Butlers

Mitchells & Butlers, the UK’s biggest restaurant and pub group which owns the All Bar One, Toby Carvery, Harvester and O’Neills chains amongst others, has hired specialist digital strategy agency Underwired. The company’s annual sales are close to £2 billion and across the group’s 1,600 businesses it serves 435 million drinks and 125 million meals each year.

Underwired has been engaged to help the company develop its digital customer engagement and data strategy. The agency, whose other clients include Sony, Bupa, Harveys Furniture and Holidaybreak plc, recently became independent following an MBO in March.

Paul Madden, Head of Digital at Mitchells & Butlers, said of the appointment:  “The digital channel continues to grow in importance to our customers and we are constantly looking at new ways to improve our online services and the levels of personalisation we can provide. Underwired has demonstrated a clear strength in the area of customer relationship management and understand how to maximise engagement through a robust data strategy.”

Felix Velarde, Underwired’s Managing Director, commented:  “Mitchells & Butlers owns brands we’re all very familiar with, and their customers are exceptionally engaged. This provides rich territory for some fascinating strategy development work, and we are extremely pleased to have been selected to work with the digital team on this project.”

Underwired’s other clients include Sony, ASICS, Bupa and F. Hinds.

Press release – F Hinds appoints Underwired

F Hinds, Britain’s leading independent family jewellers with over 100 high street shops, has appointed specialist digital strategy agency Underwired to build its online customer engagement programme. The retailer, which was established in 1856, serves around 2 million customers every year.

Underwired will develop the brand’s digital marketing strategy and will work closely with the board of the brand.

F Hinds’ Andrew Hinds said of the appointment, “We have a close relationship with many of the customers who use our shops and we want to be able to extend that to provide the same quality of service to them online. Our outlook is long term and hard sell is an anathema, so we only want to be in touch if we have something relevant to offer our customers as individuals. We chose Underwired because their approach mirrors ours and because they are straightforward and focussed on the simple things which matter the most.”

Underwired’s Marketing Strategies Head Matt Button commented, “We’re very excited to be working with such a well established retail business. We will build a long term strategy using our experience and expertise from working with other retailers that remains true to the values and ethos of F. Hinds.” Button was previously Head of CRM at retailers Waterstones and HMV, where he led award-winning customer engagement and loyalty programmes.

Underwired’s clients include Sony, ASICS and Bupa.

http://www.fhinds.co.uk
http://www.underwired.com

Nudge Factor

Yet another unrepeatable offer! Bang, Flash!! 25% off today only!!! Ugh. We recently lost a pitch. Not a huge one, but the client was nice, the brand was fascinating and the task was really quite challenging. The client didn't go for us. Or rather they liked us and loved our work but were sold by another agency who offered them a whopping great discount on an email marketing campaign based on some hard-hitting promotions. Which sort of goes to show that on occasion, when you've got one chance at a sale, making the Big Offer is often the best course of action.

Being bitter of course rarely gets you where you want to go. It does make for a very excellent basis for an article which is all about what not to do if you have a marketing, rather than a selling, job to do. And you're reading this because you're in marketing, after all. You may even run email marketing campaigns. I am sincerely hoping you may actually run eCRM programmes, or even better, want to transform email marketing into eCRM and then evolve that into multichannel eCRM. Which is about more than just a series of offers - it's about building relationships around value exchanges that are mutual, and which actually lead somewhere.

Let's start at the beginning for a minute, if you'll indulge me. ECRM is about the journey you take your customers on. Segmentation allows you to create a meaningful, relevant journey for each distinct customer type. In my own business we focus on what we call 3D segmentation - who, what and why, with the "effectiveness" dimension having been beautifully articulated as far back as 1972 when 'need states' were beginning to be discussed seriously as a component of marketing. (If your agency produces personas, they're probably at about 1983, a terrible year for music.) This customer journey takes the form of a series of incremental steps from the first moment they self-identify to the moment they stop ever being a customer, prospect or advocate. Put yourself now in the customer's shoes on this journey. How many times in a row will you want, or tolerate, a 25% off offer? And how many times will you see one before you start to think that's the normal price?

Imagine you're a brand like Domestos (forgive me Unilever, I plucked it out of thin air). You can hit your potential customers with offers all day every day, and quite a lot of them will work - or at least when Joe has already decided they need a bottle of cleaner an offer might either sway them from own-brand, or reduce the margin from someone who would otherwise pay full price. But Domestos is a premium brand. Discounting is not the way to become successful. Discounting is the way that economies rebalance themselves, it's not the way companies make money because it's much more about fundamental survival. Domestos must look to other ways to engage with customers. ECRM with its customer journey and relevance and, ideally, with an understanding of what makes the customer tick, provides this opportunity.

Because really an offer on its own does not make Domestos interesting or engaging, it just makes it cheaper.

We create customer journeys on the basis of the nudge. The nudge says to a customer, because we understand something of the considerations in your life, here's something of a little value, in exchange for a few moments of your attention. If we can do this with some charm, a modicum of relevance and a dash of intelligence, we might get to engage their attention... and if we can get it really right, this may snowball into increased consideration, purchase frequency and even - gasp! - loyalty.

Imagine you're, say, a cleaning brand(!). How about singling out mums with young children. With permission to contact mum, perhaps obtained (and here I may sound a little hypocritical) through some kind of one-off promotion, we could use this demographic insight to plot some engagement. In Keystages 1 and 2 (and later) kids start to learn about hygiene. Perhaps over the course of three months we could send mum on a journey where our value exchange is all about providing her with a heads up about what her kids will be learning, followed by some materials so she can support the learning they do at school when they get home, with some fun activities (preferably not ones which increase her workload, and especially ones which involve creating a mess the kids might run away from!). Follow-the-curriculum, colouring-in activities, downloadables, uploadables, word games - I'm sure you can think of a whole string of things you can give mum which will help her help her kids keep healthy. Not to mention having a cleaner house as a bonus...

It's a series of nudges along a journey to brand loyalty. And you don't really ever need to do any selling. You don't need to say 'Domestos keeps your house safe' out loud, it's implicit in the exchanges of value and values you've transacted with your customer along the way. At some point, one of the little nudges may even involve a voucher or a promotion, just to cement the relationship. You may give them a social space they can meet other mums in too, so long as you listen to their advice to you and you respond in a manner consistent with your brand's values.

ECRM is, or at least never ever should be, about banging on about buy buy buy (I was going to say "Harpic on" but that would have been a bad pun too far). It's about nudging, gently, so your customer wants to go on your journey with you. Because if you can take customers on your journey, while the discount merchants may sacrifice margin for survival, you'll have loyalty delivering straight to the bottom line.

Making sense of the marketing maze

FMCG Magazine, issue 11 volume 13

Why is – and why should it be that – FMCG marketing feels so vague? Everyone thinks the be-all and end-all is the big TV campaign. It takes six months to write, three months to edit, a whole bunch of illustrators, animators, storyboardists and directors’ assistants, a hundred grand in production and a hundred more grand for a slot in Corrie. This elephantine effort would be fine, were it not for one tiny flaw: you know fifty per cent of it works, but you don’t know which fifty per cent. The elephant in the room is accountability, and in today’s climate marketers must, must be accountable, as must their marketing.

We’ve come out of a recession, and are wobbling around the edge of a second iteration. Consumer confidence is low, partly driven by what people see in the financial sections of the TV news and partly driven by the doom mongers in the red tops. Businesses like yours aren’t bonkers so there is close scrutiny of every budget from procurement to overheads to manufacturing to marketing. The days of the “Let’s do TV, it works for the big brands” being sufficient justification for the board are over.

There is a second driver at work here: FMCG brands don’t sell to consumers, you sell to intermediaries – Nisa, Bookers, Asda, Tesco. You might argue that they should be doing your marketing for you (in fact, perhaps you should argue; if you spent your TV budget on selling more lines into Tesco they would have a vested interest in pushing your products hard, and yet we have devised ourselves an effective if expensive pull-oriented strategy, presumably because such tactics are too much like hard work). Yet we compete for shelf-space, PoS, the (very) occasional appearance in a promotion or an ad. FMCG brands focus their marketing towards the end consumer, essentially cutting out the middle man and appealing for share of basket. Works beautifully for the supermarkets.

So, two drivers: bypassing the supermarkets to get straight to influencing the consumer, and a terrible lack of clarity about whether this consumer focus can become more focused. Oh, and a third factor: the supermarkets sneakily deciding to launch their own brands (as distinct from own-brand) competing directly with yours. Anyone would think you were in trouble.

Over the past sixteen years – in fact ever since the Snickers® MegaBite online community was created for the brand’s Euro96 sponsorship – digital has become a valid and very useful channel for reaching and engaging consumers. Multi-brand FMCG companies have created websites, communities, games, multimedia, email and mobile campaigns very successfully, if success is measured in awards, media exposure and word of mouth. Over the past ten years, online channels have become properly measurable. The rise of analytics, and analytics specialists, has allowed marketers to track users’ online behaviour in great detail. Marketers are familiar with terms like UX (User Experience), IA (Information Architecture) and User Journeys (a term we appropriated from the supermarkets as it happens). We can drive people to websites, deliver appropriate experiences that support the brand architecture (brand onion, pyramid, pretzel... your ad agency will have its own version), and increase dwell time (the amount of time a consumer spends wandering around, through engagement or confusion, your website).

Digital can track absolutely everything. So it’s slightly surprising that most FMCG brands have not, because they believe they cannot, tracked the value they get from it. In the days when nobody knows which fifty per cent of the advertising works, you would think that having such an auditable medium would be a lifeline.

Digital means a consumer’s activity can be tracked all the way through to a sale. For example, if you sell a tin of beans on your website, we can track a visitor from before they get to the site (their first click on a Google Adword or a banner) through the site, around the site, to the basket and to a successfully concluded sale. We can attribute sales value to visits, which in turn means we can optimise campaigns, spend more on the sources which produce the highest sales, and generally be pleased that you know which fifty per cent is which. We can distinguish good from bad and make commercial decisions based on evidence. And evidence-based marketing is what your board wants.

FMCG doesn’t trust digital in the same way. It’s why, for example, most brand campaigns have a limited shelf-life online, and why websites get replaced with alarming frequency. You’re marketing to the end consumer, but you’re selling indirectly. This perception is common among FMCG marketers: indirect means indistinct. Decision making is therefore down to gut instinct – and how many awards the campaign wins. For me, that makes online marketing for FMCG brands a hopeless case. I want to know how to attribute value, no matter how indirect the sale is.

So let’s discuss a method which means that indirect doesn’t necessarily make it quite so hopeless. We’ve used it over the last four years for McCain Foods.

We started with a database of customers, acquired from a number of sources: bought lists, competition entries, newsletter opt-ins; in fact anywhere we could find data. We cleaned it up, got rid of the stale, unidentifiable, lapsed and suspect data, and created a robust base of legally opted-in people. We put together an email programme. This was pretty simple, consisting of product descriptions, recipe ideas, offers and simple calls to action. This gave us a backbone we could measure, and measure we did.

You will be familiar with the normal email marketing metrics: Open Rates, Click Through Rates and dwell time. We benchmarked the programme, making sure we had some consistency to start off with, so we could run some experiments. The first experiment: when should we send these emails? We sent the same email every couple of hours to a different section of the database to establish which time of day got the best open rates. At this best time of day we sent an email every day of the week to see which day of the week got the best open rates. Inside eight days we had the optimum send time.

The second experiment involved benchmarking against the real world. The assumption was that anyone in the database would be more engaged with the McCain brand than the general population (for obvious reasons: these people have opted in to regular emails, and they are getting regular brand exposure). What we wanted to do was to see if we could affect behaviour over time. Working alongside the brand tracking studies already being performed by Hall & Partners, Underwired created a comparable set of questions to mirror the study, in effect asking the same questions of the database so we could compare database versus general population at start, then after six months.

The results at the start were entirely predictable: 61% of people in the base loved the brand versus 20% in the general population. By the end, after the email marketing programme had been in action for six months, that score had risen to 64%, and in fact the gap had widened to 11%. The programme was clearly driving changes in perceptions of the brand, against a general fall in the advertising-only scores. But still, indirect and indistinct. How do we change this?

The next step for the campaign was to find a value benchmark. This consisted of two distinct phases: first find the comparison data, and second find a way to accurately measure any changes wrought by the digital activity. By using email only, the customer journey was kept very simple, and there was a built-in mechanism for running surveys so we could establish consumers’ shopping behaviour.

First we sourced a chunk of useful data. This came by way of Dunnhumby providing real-world shopper behaviour from Tesco customers; we sought out product choice, average purchase value and purchase frequency.

We continued this stage of the journey into attribution by refining the segmentation of the McCain database. The segmentation was fairly simple: brand engagers, brand resistors, category resistors, neutrals. This was also split demographically. The segmentation was tweaked to exactly match the Tesco shopper profiles so we could accurately compare one with the other.

So what have we found? We have discovered that when we put a person into the eCRM programme, in the first six months their purchase frequency goes up by 3%. Knowing what we know about average purchase value (in £s) and frequency for each segment, we can therefore easily find out not only how much the change is worth within the base, but also how much we should invest in acquiring more people into the database in order to drive ever-increasing incremental profit.

So what does this mean? Well, for one it means we know precisely which segments are worth investing in, how much to invest, and what the sales volumes we drive will be. This makes TV seem vague indeed – we do, now, know how to attribute value even when we’re marketing directly yet selling indirectly. We can justify every penny of the digital marketing budget (or at least that portion that’s spent on auditable campaigns) and, in a recession or in a post-recession world, that means we can be certain that what is being done is being done right.

Ad:tech seminars in September

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I’m going to be speaking at Ad:tech again this year. The first session is at 10.30–11am on Tuesday 21st September:

How to create a profitable eCRM programme
With brand consideration up 11%, eCRM has revolutionised marketing for FMCG giant McCain Foods. As a result, sales to customers within the brand's database went up 38%. This talk will show you clearly and concisely how an eCRM programme to sharply increase brand engagement, brand consideration and sales revenues.

The second will be at 11.50–12.20 in the IDM Academy:

ECRM strategy made simple

• Using FMCG and retail case studies to show the practical steps to a successful eCRM campaign
• Ten Top Tips for successful revenue generation

You can plan your visit to this fantastic event here. I hope to see you there.

ECRM and the Art of Customer Retention

Time was that marketers simply marketed. They told a story that engaged potential customers in their brands. They talked at people, hoping to attract, seduce and exploit. Retention was simply about delivering what was expected - not disappointing - and being consistent. When I became aware of interactive marketing in the early 1990s it was because of a CD-Rom called Xpand Expo, a virtual exhibition hall that you could click around, read text files placed on virtual stands, and that was about it. They’d spent a lot of time rendering an exhibition hall-like suspended ceiling, and done a good job of selling virtual stands to the likes of HP. What occurred to me at the time was that here was a golden opportunity to give some power to the consumer, by removing the sales person - but it needed structure and marketing thinking to make it engaging and work. I started my first digital agency to do just that.

Interactive multimedia truly gave the power of self-selection to the consumer. It meant if we gave a consumer five choices, they’d (almost certainly) choose the option that appealed to their needs most. Slightly problematic in that getting CDs to enough potential customers was expensive and the media was fixed. No-one in marketing took it very seriously. Then the following year along came the world wide web, and the world changed in twelve months.

Marketers cottoned onto the opportunity - eventually - to engage customers in a dialogue driven by the customer herself. Websites became big business for forward-thinking clients and agencies like ours; getting people to the websites became the next challenge but again, tapping into elective channels made sense and worked in practice. In fact, the agency I run now started as a search engine optimisation (SEO) agency in 1996 as an offshoot to our web agency. And actually that leads me towards the problem marketers face at the moment, which in my view is crippling the advance of interactive, elective experiences that customers can enjoy and companies can make millions from. And they can, because some have seen how to solve the problem.

The issue is that in the years following the early pioneering experimentation, digital marketing has become siloed. When I last looked there were 3,500 companies claiming to build websites. SEO has become an industry in its own right - in fact, two industries: organic (natural) search optimisation and paid-for search, (PPC – pay-per-click). Web has become websites plus tactical microsites, often by different agencies. The DM agency probably has a microsite supporting a print campaign. The PR agency is looking after “reputation management”, though it might be subcontracting the Facebook page to a social media agency. Oh, and the online ad campaigns are being specified by the media buying company.

I’m sure it all made perfect sense at the time.

So here’s the situation most clients (except the really canny ones staffed by strategic thinkers) find themselves in today. A dozen agencies, some nested or subcontracted. Each of them doing what they’ve been told. And if they’re good, each one is trying extremely hard to improve on what they did last quarter, incrementally increasing click-throughs or eyeballs or impressions or recall by 3%.

Many of the really good ones will be coming to you with really great ideas for attracting new customers. Fantastic viral ideas coming from the ad agency. A really good creative hook with legs from the online agency that will reach new audiences and probably drive some extra traffic to the website too. And what with the e-commerce company annually improving the sales funnel, well, it’s an ever-improving world out there. But while all these bits and pieces are individually doing better than whatever they were doing before, they are also gradually losing touch with each other. It used to be that marketing marched to a single coherent beat, where the TV ad established the awareness and each other medium elaborated on the brand message. Yet that’s fragmented badly, and what we’re left with is a mess of tactical, competing, agency-income-motivated digital campaigns that have no backbone or strategy, and which often do more to confuse the customer than empower them.

It’s a situation we see all the time. And there is a simple way of getting out of it, though it takes will, vision and patience.

We need to go right back to the customer. The data is the key here. All of the various marketing activities I’ve described deliver data in fairly large quantities - data about who your customers are, how they behave, what they like, how many times they buy, how much they spend, how long they last, how quickly they churn and so on. Again, it’s probably in a variety of different places, but that doesn’t really matter. The first step is to find it all.

So, step one, find the data. Any eCRM agency worth its salt will be able to manage the aggregation of this data, manage its analysis, and come up with insights about your customers. These insights inform segmentation - behavioural, demographic, technographic; value (by whatever measures)-led, loyalty-led, influence. And segmentation tells you what you need to say to each of them at what time to increase their engagement and to increase sales... when McCain Foods did this, engagement rates with brand resistors went from 14% to 63% in just ten months.

So now we have a map of what needs to be said to whom and when. In its most basic form eCRM can easily be delivered by email. This might be augmented by microsites speaking and exchanging information with each segment. Supporting this you might want to extend forums or social media that allow customers to interact further with you, or each other. If you observe these closely enough you’ll find out what’s bothering customers - in fact they might show you how to segment them even further or what’s going to interest them in the future.

And suddenly (well, to be fair it might be three to twelve months) you have the kernel of a digital strategy. Followed through, the segmentation which came from all that disparate data can start delivering genuinely useful information that essentially becomes the foundation of a marketing strategy. Simply observing the success or failure of each strand of communication with a segment by watching the behaviour of the recipient, gives you the power to change the options you make available to her over time. It’s enormously powerful, and because all that is being done is observing response and making changes based on what is seen, the power really is back in the hands of the marketer, even if it appears that the whole machine is being driven by the customer.

And from this observation of what works and what doesn’t, what motivates or engages and what demotivates or disengages, comes the magic: very quickly we start to see which segments we want more of. And that means we know what to tell our agencies to do. They are suddenly working to your plan, not theirs, and your plan is driven by an eCRM strategy not an agency account handler’s desire to make themselves famous with an award-winning viral or a 0.002% increase in banner clicks. Time was that clients drove strategy, rather than herding agencies, and eCRM brings that time back, at long last.

De-fragmenting Digital

Most clients have a web agency, an online media agency, an online advertising agency... Some have an email delivery platform, or an email marketing agency, SEO and PPC specialists. And then the advertising agency or the sales promotion agency do tactical stuff (virals and vouchers, gobbling money to little useful gain). You might have some of these, or work for one.

Most clients spend lots of time getting their agencies to improve what they’ve got by 3%. That’s a 3% better website, or a 3% better performing ad campaign. It’s all, from what I can see, very tactical, very incremental, deeply fragmented.

But we’re in a recession, and it’s just not good enough. There’s a huge opportunity to think again, to take stock and look around at what’s possible today, not what was possible five years ago when you started on the road to improvement. Today customers expect to have a voice, they expect you to listen to their needs, observe their behaviour and deliver them relevant, timely brand-engagement-inducing nudges and touches, wherever they are, online or off.

ECRM offers a slightly different way of looking at things, provided you define eCRM as a strategic approach rather than an executional method. It requires that you head back into the customer data, evaluate all the touchpoints you currently have - the website, ads, emails, SMS, social media - and create a strategy that is designed not to have the most engaging website, but the most engaging customer journey. This way you become channel-agnostic, and digital execution becomes subservient to how you relate to your customers, not the other way round.

It’s worked particularly well for companies like McCain Foods who’ve turned digital on its head and are now having a single conversation across several different channels. Brand engagement with brand resistors has gone up from 14% to 63% in ten months, which is staggering.

Using a top-down strategic view doesn’t mean getting rid of your agencies, it just means they’ll all be working to a single over-arching strategy, rather than just doing the best they can do in their niche. It means you get a coherent plan that can be delivered as usual through segmented email or segmented microsites, but is flexible enough to incorporate new channels (like social media) as they emerge.

All digital de-fragmentation takes is a little strategic thinking, but what it leads to can be revolutionary.

This post first appeared on my Revolution Blog on BrandRepublic.