Friday, August 31, 2012

Pine Creek Fire

What happened on my summer vacation?

Usually this blog is about my day job - marketing, technology, data, etc.   Today it is a bit more personal.  

Just south of town a forest fire started on Wednesday and has grown from 20 acres to 12,000 in less than 48 hours.   Not only did the fire run up the drainage toward the tops of the mountains, but it also ran south as the winds shifted around.

Livingston Enterprise Photo
And when you know the people who live in the house in the picture and they're planning on evacuating their horses, possessions and memories this kind of news takes on a whole new perspective.  

We had a barbecue last night and it offered a respite to a few of those who couldn't return home and didn't yet know when they could.  Glad we could offer a small community of support to our friends.

Speaking of community, the news of the fire spread quickly on social media - particularly on Facebook - with support, best wishes, and offers of assistance coming from all locations.   The 'chatter' as it was called by officials unfortunately had many inaccurate statements about the burning of particular buildings and the loss of life.   While some structures were lost no one perished in the blaze.   The lesson is to take such news with a dose of skepticism. 

Hopefully the cooler weather with slow this beast down.

Thursday, August 23, 2012

Seven Things Marketing Should Know About Big Data

What are the key points to remember about Big Data?
  1. The migration to a digital and interactive world creates breadcrumbs of all types everywhere; this in turn dramatically increases the velocity, variety and volume of data.   We need to rethink just what it means to be data.  
  2. Big Data is so big that our historic view of processing it - requirements, capture, analysis - just doesn't work anymore.   For those of us who grew up in the marketing database era, we have to completely rethink our relationship with IT.  And IT will have to rethink its role.
  3. The idea of Big Data will go thru the typical hype-cycle where it becomes the topic of conferences, technology pitches, and bloggers (including me).  Thus, it will mean different things to different people and that requires patience and a steady hand to navigate.
  4. Like all large, complex, and fast moving worlds the best approach is to have a clear objective in mind before you start.  Set the goal first to help deal with the really messy aspect of Big Data - access and transformation.
  5. Since the majority of the Big Data is now created 'out there' rather than from just buying stuff from us we have the ability to understand the path to purchase much better than ever before.  New understanding of what happens at each step in the journey will be required thru 'moment' or 'value' mapping exercises.
  6. Given that we want to derive insights from Big Data, the deployment methods will have to change.  We can't assemble in a conference room to discuss changes in offers and messaging - we must learn to trust the data and let it decide within a framework.  Predictive analytics will be operational, not project-based. 
  7. Your brand promise will have a strong guiding hand on how you leverage Big Data. Understanding what benefit consumers takeaway from your product or service will help you decide how best to facilitate their journey and choice.

Thursday, August 16, 2012

The New Face of Database Marketing

Where is database marketing headed?

In the beginning database marketing was defined as
"Database Marketing is an interactive approach to marketing, which uses the individually addressable marketing media and channels ... to extend help to a company's target audience; to stimulate their demand; and to stay close to them..."
That was written just about 25 years ago and still resonates today.   What has changed dramatically is what it means to be 'individually addressable'.   The newest Facebook feature, Page Post Targeting Enhanced, allows messages to be posted to the news feeds of specific segments of people based on a wider variety of demographic information, but not 'likes' at the moment.   Before this the best we could do to narrow the audience was by language and location.  Thus, the FB news feed, once a broadcast tool, now qualifies as a database marketing tactic.

But that's not all.

On the flip side is the opportunity to serve different content at different frequencies to different segments.  So, rather than thinking linearly about who should receive our offers, we need to think in terms of a matrix - which segments get which offers?  This is beginning to sound like how we think about other digital marketing tools where offers or ads are dynamically generated based on context, consumer, and intent.  The implication is that database marketing skills should be combined with digital marketers in a direct-to-consumer function.   Their responsibility is to place offers along the shopping journey that help, stimulate, or connect with the target.

Now, if we combine the legacy of database marketing - using a customer's transaction history to do it 'right' - with the new digital capabilities some new ideas emerge.  Imagine a news feed of
  • Recipes augmented by offers based on your previous purchases and content consumption
  • Books or music recommendations based on interests, current collection, and friends' lists
  • Exclusive content and promotional tie-ins from sponsors of events
For any brand considering these ideas, they should have a large fan base.  Thus, an integral part of the social media plan should be on acquisition - just like database marketing. 

Tuesday, August 14, 2012

Relevance vs. Incentive

What are we trying to achieve with relevance?

The typical phrase used to describe content is 'be relevant' but what is discussed around content tends to be offer-related.  A lot charts that appear in retail research and presentations suggest that consumers want offers, deals and promotions.  But is that all we mean by the phrase 'relevant content'? 

Some definitions first:
  • Relevant refers to being 'pertinent to the matter at hand'.  
  • Incentive refers to 'stimulating action or effort'.
It is likely true that as consumers we prefer retailers that apply business rules to the potential offer pool to ensure we find things of interest, i.e. personalized coupons based on transaction history.  And it is a small logical leap to go from using the term personalized to relevant.  

While custom coupons are relevant; is all relevant content necessarily promotional?  

It seems that our point of view need not to be the same when it comes to relevant vs. promotional content.   In the first case we need to understand what the consumer is trying to achieve; in the second case we need to serve our best option to generate an event or transaction.  Similar, but not quite the same.   In fact, there may be other types of content that are appropriate depending on the context of the situation.  And it is context, both the consumers and ours, that should shape our content strategy.  

If we want to help her, be relevant by first understanding what she is trying to achieve.
If we want a sale, offer incentives that make sense to her and mitigate the risks of decisions.

So, let's first be clear about what we're trying to achieve.




Monday, August 13, 2012

Context Generates Big Data

Where does "Big Data" come from?

Lots of discussion these days about "Big Data."  A technical term that made its way fairly rapidly into the daily discourse.   Simply put, big data is the result of the increasing velocity, variety and volume of information being generated as we act like cyborgs.   A recent NYT article describes how we got here and what the opportunities might hold for businesses.  

On the one side of the real are the half-empties who worry that the term 'big' is another nefarious character who wants to control our lives - brother, government, and oil come to mind.  This is the central argument around behavioral targeting - too much data is a bad thing.  For the half-full's amongst us, big data allows for some interesting concepts for marketers, not only in terms of relevance but also in terms of incentive. 

One current idea being tested is the creation of personalized pricing where everything that is known, inferred or surmised about an individual is used to set the prices a specific customer sees. These price differences may be in flyers, coupons, or at the shelf. And since smart phones are the new decision support platform prices could be different in and out of the store. 

The mantra of delivering relevant content to the right person at the right time in the right place means context matters.

And thus it is context, and the need to understand it in real time, that drives big data.


Wednesday, August 08, 2012

Customer Replacement Therapy

Where do we need to focus our attention?

In many circles the discussion focuses on customer loyalty; it sounds so good.   But the reality is that we lose far more customers on the way to loyalty than we care to admit.  In fact, the odds run 19 to 1 against.

First, just what do we mean by loyal?

Like many concepts in marketing it can be elusive to define what we mean.  For this post, I'm going to define it simply:  A customer is loyal if the probability of another visit exceeds 60% so a bit better than flipping a coin.

Since we tend to be creatures of habit, the probability of shopping somewhere is fairly predictable at least in aggregate.   In fact, we can fit a curve to estimate the number of future transactions a business is likely to have from a cohort of new customers.

The picture shows the results of estimating how many future transactions a group of new customers will make over the next year or so.  The steep drop off from 0 to 1 is quite typical and is a function of the category purchase cycle.  But the crux of the matter is very clear, a lot of people simply don't come back for a second visit.

Given the definition of loyalty above, that doesn't happen until the 4th transaction or higher where the step change from one transaction to the next starts to get small.

The implication:  We go thru a lot of customers to get to one loyal customer.   To see the effect of this curve on a business, imagine starting with 50,000 customers and we want to know how the business looks after 10 years.  In particular,
  • How many loyal customers do we have?
  • How much focus do we need to spend on acquisition?
The following table simulates the above curve over time and shows the number of expected customers each year by the their visit number.


After 10 years, fewer than 5% of our customers are loyal.   More importantly, 60% of our business comes from new customers. 

So, rather than burn thru bodies to get to loyalty maybe we should think more about our replacement strategy. 
  • Why do over half of our customers fail to come back?  How did we disappoint them?
  • Why does it take so long to go from trial to loyalty? What are people thinking at each stage?
  • What is the essence of our offering that makes the decision to repeat a no-brainer?


Tuesday, August 07, 2012

Impossible Marketing

What does a walk-in computer have to do with marketing?

Recently a colleague circulated Joel Runyon's chance encounter with Russell Kirsch the inventor of the first internally programmable computer who pretty much summed up his view as: "nothing is withheld from us which we have conceived to do." 

Or, just do the impossible.

And to put a finer point on the idea of conceiving something never done before he also created the first digital image.  And 50 years later we're still living with the square pixel - it was 'logical' to use.

While the storyline centers on computers, particularly those we can use to create stuff versus merely being consumers, the idea clearly extends beyond code and technology.

In fact, this mantra describes the entrepreneurial spirit pretty and should be applied to marketing as well.  The digital era creates the perception and need to both re-imagine how things work and then solve the consumer's need for solutions.

So, what should marketers conceive in the new ROPO world of researching online, purchasing offline that many might deem impossible?  A couple of recurring themes.
  • Altering the product assortment that a consumer recently browsed.
  • Surrounding the consumer with real content that actually helps her choose.
  • Leveraging purchase and event histories to create a media plan for one.
While there are technical challenges; these are not technology problems.   They simply require a will and persistence to overcome.

What would you think would be impossible?

Wednesday, August 01, 2012

Choice Marketing

What is the next evolution of marketing?

It has been said a million times: Marketers are no longer in control.  Self-expression, technology and media fragmentation have fundamentally altered the flow of information.  As a result we live in a "fluxed-up world" (found that on an agency bio) which is a bit more earthy and descriptive than the fluid fog.

So, if we're not doing business as usual then we shouldn't be doing marketing as usual.  So, what augments Brand Marketing, Direct Response Marketing, Content Marketing, etc.?

How about 'choice marketing'?

People are going to make choices, they will decide regardless of what we do.  Since we can't limit the information they use to reach their conclusion or where they access it, let's flip the table and ask the question:  What can a brand do to facilitate a person's choice?  How do we make it easy to choose us?
  • Do we understand the needs and aspirations?
  • Do we know the intent of each interaction along a journey?
  • Do we know the emotional and rational drivers of the decision?
  • Do we know how various types of content influence that decision?
  • Do we understand why and how a consideration set is formed?
  • Do we know the shortcuts people take in making a decision?

Since a brand is a proxy for information (Chris Anderson from wired's view) or an emotional short cut to a decision (my view) maybe a brand is simply in the information business; it is an aggregator and sometimes filter. 

Actually, 'choice marketing' would be what an agency would sell to its clients.   An altogether different view would be to focus on 'facilitating choice'.   While the wording change may seem simple, the implications of taking the consumer's point of view could be rather striking.  

Tuesday, July 31, 2012

Retail isn't About Shopping Anymore

What happened to shopping at retail?

Nicholas Negroponte once wrote...
You enter a store. You see something you like. You write down the product name and manufacturer. You go home and order it over the Internet. As a result, you didn't have to carry it, you probably got a better price, and you may have avoided sales tax.
The store in this scenario is merely a showroom. Have I just described the exception to tomorrow's retail, or the rule?
Except for that 'write down the product name' he got it about right.  In their third annual update on the future of something, PSFK highlights the new trends for retail that take advantage of technological changes since 1998.


The ideas center on one theme - make it easier to choose by blending the best aspects of digital and physical experiences. 

Thursday, July 26, 2012

Quantifying Evangelism

How should we look at mobile research?

A recent MediaPost article reported research sponsored by Greystripe that suggested mobile shoppers are more likely to be evangelists (as well as naysayers) than their traditional counterparts.   This conclusion was based on the number of people who posted reviews about their experience - 49% vs. 31%.  In addition, the results suggest that mobile shoppers are less price sensitive because fewer of them reported the use of retailer coupons - 71% vs. 94%.

I grew up in the market research industry so tend to think in terms of the validity of the results.
  • Who does the sample represent?
  • Do the conclusions reflect the data?
  • Can we extrapolate beyond the sample?
This research came from a self-selected audience who responded to an inquiry to participate from the sponsor's mobile ad serving system.  So, the 'traditional counterparts' are still engaged mobile users leaving us looking at only one segment of the shopping market.

The jump from 'write reviews' to 'better evangelist' equates an action with a mental state without understanding the reasons behind it.   Sharing opinions can be considered an aspect of evangelism, but it could also simply reflect the basic need for self-expression: "I post, therefore I am". 

The results do pose some good food for thought, but only within the context of who responded.  There is other evidence that suggest that 50% of US population has written at least one review; if that figure is correct then this sample is 'below average'.   On the other hand, Forrester's "Social Technographics" suggests that 37% of the US Adult population are 'Critics' (those who write reviews). 

In an example of the importance of the reviews Olery created an infographic on the hotel industry.  And because the data came primarily from TripAdvisor it isn't surprising to see the purpose of the trip to be for 'fun' rather than for 'work'.

And these issues are things the whole mobile research industry faces.   A recent conference sponsor on the topic posted a number of key take-a-ways.  Some of the key ones:
  • The industry is too young to have standards established yet and the likely leaders aren't necessarily interested in setting them
  • There is a thirst for innovation but there remains an addiction to what we've measured before
  • Entrants will have to prove the ROI while at the same time breaking traditional models 
It is a good time to be in market research....

Tuesday, July 24, 2012

Segment Based on How Consumers Choose Too

How do retailers segment their customers?

The National Retail Federation and KPMG do an annual benchmark study on retailing.   In this year's edition there is discussion of how firms segment their customers.  Here's a summary chart.
It is good to see all the usual suspects, starting with a consumer's transaction history and her preferences.   But in this day and age of channel blur, infinite paths to purchase, and self-expression there appear to be additional opportunities to better understand how consumers choose not just what they chose.
  • What touchpoints are used? In what sequence? For what purpose?
  • What types of content are consumed?
  • What media crosses their path, when?
Since satisfying growth objectives requires finding new ways to efficiently and effectively reach consumers,  we might want to consider focusing our segmentation thinking outward on the digital bread crumbs. 

Monday, July 23, 2012

Social Media is Passing the Turing Test

What happens when we can't tell if it is real or Memorex?

In this age of fragmentation we often use an adjective to qualify what segment we're talking about.   To take a few - print media, broadcast media, online media and social media - it is the adjective that helps us understand the goals, functions, cost models and conversion expectations.

But if we drop the adjective, we're simply left with 'media' - the paid placement of a message.   And in the digital era it is very easy to blur the distinction.   While 'social' started out as focused on human interactions, the technical underpinnings allow for much more.   In a recent article on Fortune about tweetbots, Ryan Holmes of HootSuite suggests a bit of moderation along the path to automation.   We know that targeting can go too far, but so can the creation of content and social posts.

Memorex Ad
And unlike like the Memorex ad it does matter whether it is real or just technology. Anytime we can write down the rules, we can automate the process.  This is where a lot of productivity gains come from.  And sorting thru the bizillion conversations to find the useful comments is clearly ripe for a technology fix.  And so is the scheduling side of things.

Back in the 1950's Alan Turing thought thru whether digital machines could imitate humans well enough to fool the panel.   This was an easier task than answering the question 'can machines think?'   The result is known as the Turing Test.

When it comes to social media we are getting close to passing that test - the auto-generated tweets and posts that pass as human.   While the advantage of scale is obvious care should be taken in how far we go down this path.

Tweetbots and the like could produce some unintended consequences.
  1. Social media will become just like TV media - lots of eyeballs but conversations are filtered
  2. People will move toward less business-centric avenues to connect.
  3. As the ability to connect becomes pervasive in newer technology, there won't be a need for a separate platform.
Maybe we should have stuck with the original moniker:  Social Technology. 

Thursday, July 19, 2012

Mobile is Not a Screen

Why does mobile marketing cause us headaches?

The future of marketing is literally in the palm of our hands - the smart phone.  But we have to rethink things; it is not just another screen.

Given all recent stats from just about every firm around, there should be no question about the impact of mobile on retail shopping.  True, it varies by category according to Deloitte reserach but the trend is undeniable: we use it to help us decide.

The result is a series of paradoxes we're not used to because it totally disrupted the path to purchase as we understood it to be. We're now operating in a world when...
  • More information from more sources is present at decision time not less because we don't need to wean out choices ahead of time.  
  • The ability to push messages first requires pull, activation or opt-in because this is personal not broadcast.
  • The content is not what we'd thought it would be (ads) but rather what they need (info) because that is what is actually important. 
  • Awareness and consideration may occur at the same instant because it eliminates the need for prior research.
  • The time and space distinction of channels has evaporated because there are no physical constraints on where it can be used.
  • Showrooming can lead to higher in-store conversion because consumers can recognize the offer as 'good enough'. 
So, let's stop thinking about mobile as the 3rd screen (NYT piece from 2007) for advertising but rather a decision support platform. 

Maybe we should design our content strategy like a dashboard....
  

Tuesday, July 17, 2012

Generational Shift: Buying vs. Owning

What if owning didn't require buying?

There have been a series of articles about the generational attitudinal shift among the Millennials toward shopping for cars.  First, the NYT wrote about the "MTVification" of GM where outsiders and upstarts are trying to infuse the culture and product line with insights about what younger people want.  They want the Apple Store not a car lot.   This was followed quickly by an article in The Atlantic that explored the topic further to explain why young people aren't buying cars.  Part of the reason is likely to be the desire to live in an urban setting.   Research into home ownership suggests that that bastion of success is becoming less a part of the dream.  And finally, John Dykstra wrote a piece this month in Fast Company that summarized the needs of the Millennials.

Simply put, this generation "doesn't want to buy stuff."  

Instead, they buy things because...
  • of what they can do with them.  Here, simplicity of lives reigns - particularly when you think  of it in terms of creating a seamless relationship with technology.
  • of what they can tell others about it. Again, technology has facilitated sharing to a level that makes self-expression an art form.
  • of what it says about a person by having it.  As life priorities and needs shift, the role of products changes with them.   Conspicuous consumption and freedom of the road have been replaced by a socially conscious and local focus.  
While it seems silly to state that products and marketing programs should reflect the times, sometimes it is hard to step back and glean the insights of generational shifts.  The challenge of adopting to generational shifts is not only on the product side, e.g. lemonade or denim color palettes, but also in terms of how we market.  The symbiotic relationship between consumer need and our solutions must be embedded in the way we connect with consumers.   Selling via interruption and intervention was used to reinforce the need to actually buy something, just ask the direct response folks.  But since technology allows us to do, share, and express without actually buying anything at all then a whole set of notions need to be reconsidered.

I think the point of these articles is to ask us to rethink the nature and benefits of ownership itself.  And in doing so we may come with insights into how to exchange value.

Time to talk to my son more, he's a millennial.  

Wednesday, July 11, 2012

Marketing IS Hacking

What do marketers need to do?

If we define a hacker as "generally referring to someone who challenges the existing order, most often using science, engineering, or information technology" in order to change it then we are really talking about marketers in the digital age.

The purpose of marketing is to change history by identifying growth opportunities in terms of markets, products, segments, etc.   Today, this is as much about leveraging technology (and the data it spins off) as it is about the human element.   In fact, about a year ago the post "Find a Growth Hacker" clearly tied hacking and marketing together at the hip when author Sean Ellis talked about that entrepreneurial drive to do what ever it takes to grow the business.

More recently, the term has appeared in connection with big data.  In a Mashable post earlier this month, Joseph Kelly talked about the need for data scientists and growth hackers inside of agencies.  These are the folks that figure out how the world works at its core, kind of like the Higgs boson, then put something new together from the parts so that they can make consumers' lives easier.

And it turns out that marketers have questions that need serious hacking:
  • What is the likely next step in a consumer's journey? - when she herself doesn't know.
  • How can we intersect a journey with interesting content? - for a person that we can't track.
  • What would help her choose? - when we don't understand her changing need states.
The challenge is that these questions require the independent, innovative, hacking mentality that doesn't typically fit within structured programs.  In this world success is measured after the fact, not guaranteed before. 

If your goal is to be an agile leader then hacking is required because the mantra is test, fix and try.

Friday, July 06, 2012

Retail Trend: Blend Instead of Separate

What does the future have in store?

Marketing Charts recently summarized research among retailers on what they see the world looking like in 5 years time.  While clearly written from a retail perspective, e.g. the first step along the path to purchase is to pick a place to shop, the scope of the discussion applies to beyond in-store behavior.  The sub-head says it all:
Omni-channel retailing is about giving customers a seamless, consistent experience whether it's in-store, online or through a mobile device.
To achieve that lofty goal the research suggests we must:
  1. Know who is shopping where and when
  2. Integrate physical and digital worlds (like IBM's test of augmented reality)
  3. Give associates the same level of information that the web site has
I can just imagine a team working to overlay the strength of data-based merchandising, think collaborative filtering in Amazon, on top of the traditional shelf-set or merchandising plan via proximity technology.  Fashion retailers are already doing similar things moving RFID from inventory control to helping consumers find sizes and accessories and creating a digital mirror to see how it looks.  

And all this produces new data upon which to glean insights on how to make the consumer's experience more enjoyable.

Tuesday, July 03, 2012

Marketing's Role: Simplifying Decisions

What should marketing be focused on?

A recent series in HBR begins to explore why consumers stay with a brand or product.   The authors conclude that it comes down to the way in which they make their choices.
The single biggest driver of stickiness, by far, was “decision simplicity”.
Product proliferation, media fragmentation, and continuous partial attention lead us to find short cuts to decisions.   Chris Anderson, editor of wired, once described a brand as a proxy for information.  And it is this message that resonates in the article.  The three key consumer needs are:
  • Trust the information they receive – providing recommendations by consumer advisors, ratings and reviews.
  • Learn effectively without distraction – simplifying the research process by offering clear and streamlined brand-specific product information targeted to each decision stage.
  • Weigh options confidently – making transparent buying guides and brand differentiated information easily available.
To be clear, this isn't just about producing feeds and speeds or feature checklists.  One must recognize that aspirations, risks, and needs sit behind every simple choice.   

Thursday, June 28, 2012

Creating Paths to Purchase

Do we follow a path to purchase?

No, we create one.

The path to purchase is actually not much of a well trodden path followed by people as it is the unique set of activities taken by an individual.  Given the interactive nature of the digital age, it is only a path when we look in the rear view mirror. 

From search to purchase to evangelism there are numerous stages and both Forrester and McKinsey have described the journey.   However, not all steps are necessarily involved.  I may or may not do feature comparison or price shopping, even though it seems rational to do so.  In fact if you can get me from discovery to purchase without the intervening steps so much the better.  

It is likely that if we documented the path a person takes it would make perfect sense to her and quite possibly to no one else.  This suggests:
  • Each potential activity merely has a probability of occurring rather than a certainty; our marketing plans must count on consumers skipping steps.
  • While the steps taken may be sequential in time; they have no order and do not adhere to a calendar.   I can research after I decide. 
  • The path doesn't really have a final destination as my recommendations can play a role long after disposal. 
So rather than a touch point being for a single purpose, it needs to support a variety of goals.   Figuring out someone's intent when they come to a stone in the path becomes the challenge.

If we are indeed creating paths, then the key planning questions for designing the content for a touch point seem to be: Why are you here now? Where have you been and where would you like to go?

Tuesday, June 26, 2012

Segmenting Like a Journalist

What can analysts learn from writing good stories?

Besides having a beginning, a middle and an end the basic tenets of journalism include addressing the key questions of Who, What, Where, When, Why and How.  A story isn't complete if any of these go unanswered.  The same can be said of segmentation schemes.   In the age of channel blur and interactivity we need to know more than the fundamental of who did what.  In fact, we need to know a whole lot more.  

The key questions from Journalism 101 serve as a good guide:
  • Who - this may in fact be a set of segment schemes rather than a specific individual; particularly in the digital realm.  Site visitors may be browsers or purchasers; customers may be loyal or not. 
  • What - while typically framed in terms of products, it can be categories or characteristics, e.g. sustainable or value-priced.
  • Where - the location of activity often provides insights into intent.  Consumption habits 'at home', 'at work' or 'on the move' form a basis of segmenting consumers but so does what sites, publications, messages were hosting the content served.   An informational product review site  could have very different influences on the speed and direction of the consumer journey than an aspirational magazine site. 
  • When - this is both temporal, e.g. hour of the day, but also can refer to life-stage changes and where the consumer is in their journey to a decision.
  • Why - this is likely the most difficult since there isn't explicit data relating to intent.  Things to think about: What is the individual trying to accomplish? Why are they consuming content or doing things?  Are they conducting research or are they seeking support?
  • How - content consumption habits by device is the final piece of the puzzle.  Which screen is involved for what purpose?
The goal of segmentation is to identify a homogenous group of people whose needs or behaviors are similar enough that we can satisfy or leverage them.  In classic segmentation schemes like RFM and path analysis we try to understand the behavior of people typically along two or three dimensions outlined above using existing data   The digital world continues to create new opportunities.  First, we need to think in the six dimensions of a consumer's journey.  Second, we must work more with clues, breadcrumbs and inference than deterministic facts.

The order in which the segments are implemented probably depends on the nature of the business, but the story isn't complete without them.

This suggests we hire journalists to develop personsae along with traditional database marketers for our digital teams.

Friday, June 22, 2012

Privacy Concerns Result from a Lack of Trust

Are we looking at things backwards?

In a recent discussion on privacy, PII and what we can/cannot do with data the question arose as to what would lead to a privacy issue in the first place.  There are reams of things written on the principles for dealing with privacy from data protection to permitted use to means of redress.   However less seems to be written of what could we do in the first place that is of value to the consumer that might be preventative.

Our roundtable led to the idea that privacy becomes an issue when we violate the trust consumers have placed with us when they shared information.   In his book Loyalty Leap Bryan Peterson, CEO of LoyaltyOne, makes the point that we give up information in hopes of a better relationship, experience, product or service.  In short, we entrust brands to make our lives better - violate that and the walls of privacy quickly rise up.

Since a brand is in the business of satisfying needs, the better job we do on that front the more likely we'll be trusted to do it in the future.  In this sense trust equates to a form of predictability.  When I know what I'm going to get the more willing I may be to share things that make it better or easier. The shroud of privacy arises when I don't know because I have no experience with a brand or our history is erratic and I simply want to protect myself from abuse. 

Trust results from a series of consistent experiences over time.  So rather than just discuss the constraints of consent, limited collection and openness we also need to discuss in the same meeting how information helps us help the consumer in order to minimize his defenses.