Knowing how the human mind processes information and images—and putting that knowledge to use—can help you become a more engaging and effective marketer.
Here’s a look at some fascinating facts about the human mind, from a marketing perspective.
I had a chance to catch up with fellow author, Simon Sinek to discuss his book called – Start With Why at the World Business Forum held in New York at Radio City Music Hall on October 7-8. My goal was to go a bit more in-depth on how to get started for B2B marketers, hope you enjoy the interview.
For those that follow this blog but are not yet familiar with your book Start with Why, give us little background.
A few years ago, I discovered that every single organization on the planet, even our own careers always function on the same three levels: what we do, how we do it, and why we do it. Everybody knows what they do. It’s the products we sell or the services we offer. Some know how we do it. It’s whatever you call it, your differentiating value proposition, your USP, the things that you think make you different or stand out from the crowd. But very few people and very few organizations can clearly articulate why they do what they do. But why I don’t mean to make money. That’s a result. I mean what’s your purpose, what’s your cause, what’s your belief, why does your company exist. And those that understand the why can clearly communicate it have an unbalanced amount of influence and success and loyalty in the marketplace with greater ability to innovate on all the rest of it.
Can every company have a why?
Not only can a big company have a why, every company does have a why. It comes from the founder. It’s the reason why they started the company. Those that are started from market opportunity, I read this article in a magazine and I realize that those tend to be very weak and they tend to not do well. But when a human being personally suffered or people close to them personally suffered something and they found a solution to whatever that problem was and that was the birth of the company, that’s a clear purpose.
Where’s the right place for a marketer to get started?
A good place to start is when companies are formed around real problems. It has to be born out of the cause of the founder. If it wasn’t a specific problem, then that founder has their own why, and the company is formed in their own cause. Virgin is Richard Branson. It’s the same thing. So you can usually go to the personality or the cause, the why of that founder.
How do you make it stick with the organization?
The why is the sticky part because it’s the visceral part. The why talks directly to the limbic brain, which is the part of the brain that makes decisions. It’s the emotion and feeling part of the brain. So when we start with why, that’s what makes it sticky. You can start with what and people might enjoy it for a moment. You describe the product, what it does, and it may or may not appeal to some people. But it’s the why that makes it interesting and makes people viscerally connected to it.
How do you make a strong why work in a B2B professional services organization?
The good news is that even consultants, accountants, or engineers are still human beings. So as much as they like to believe that all of their behavior is rational, it’s not. Otherwise they would only buy the cheapest product and they would never be loyal to anything. When the why is clearly communicated, it viscerally appeals to people, and they feel connected. And being a part of an organization with a clear sense of why becomes part of our self-identity. We wear the tee-shirt that they gave us at the company picnic. We don’t wear it to bed or paint the house. We wear it with pride and don’t want it to get dirty because it’s part of our self-identity.
I had a chance to catch up with Columbia Business School professor and fellow author, Rita McGrath to discuss her latest book called – The End of Competitive Advantage: How to Keep Your Strategy Moving as Fast as Your Business (Harvard Business Review Press, 2013). I also look forward to seeing her speak about this topic at the upcoming World Business Forum held in New York at Radio City Music Hall on October 7-8.
Tell us why sustainable competitive advantage really a failed notion these days?
Because it causes companies to do a lot of dysfunctional things like just focusing on the bottom line. If you’re looking for things to stay the same and you’re looking for reasons to keep just doing what you’re doing every day, then chances are that you’re going to be taken by surprise by the changes in the environment or changes in the competitive intensity of your business or things that are just not going to take you in a positive direction.
So the assumption that change is the weird thing and stability is the normal thing is something that causes a lot of companies to get taken by surprise. That’s why I argue that if you have this bias for sustainable (as in long-lasting, not as environmentally sustainable) it sets you up to make a lot of poor decisions in an environment that’s changing rapidly.
So how should companies think about and organize themselves to take advantage of short-term sustainable advantages?
The first big thing that companies need to do is to look at the elements of their business portfolio as an integrated whole, see that some things you’re doing that are driving today’s core business and that are going to continue to drive tomorrow’s core business. And you should keep doing them. Then you’ve got some things that you’re investing in which may be candidates to be part of the next generation core business, things that you’re doing today that could lead to a big, healthy business in the future. When Apple – just to take a common example – goes from making computers to making music players, but that’s an investment in one of these new platforms.
Then you’ve got to have things that you’re working on that are what I call “options,” which are small investments you’re making today that buy you the right but not the obligation to make some kind of future investments or take advantage of some future opportunity but that you don’t necessarily have to follow through on.
What does “good” in this new age look like?
If you look in the book, there’s this set of ten growth outliers that I think get a lot of this right. The kinds of things that they’re good at doing are letting their structure change as their business opportunities change. Things like making sure that leaders don’t get too calcified in any one role or any one spot. Making sure that they do things fast, they make decisions quickly. Their pace is quicker than a lot of other firms.
The problem with a lot of companies, particularly with respect to things like innovation, is that their structures were built to serve some of their business purpose in the past. So the structure they have today was built to help deliver yesterday’s business. When tomorrow’s business requires doing something different, you might need a different structure to go after it. But very often, the phrase I hear all the time is it “falls between the cracks” of the existing business. So what you want to be thinking about is building the right structure to deliver the business of the future.
What role can marketing play in helping to define a new opportunity? Is it the classic role that marketing plays, or is it something more?
I think it’s something different, and I think the world of marketing is about to undergo the most ginormous upheaval. And it has to do with the fact that on the one hand, the analytics that form the cornerstone of traditional marketing are really changing rapidly. When I was doing my PhD, it was all about conjoint analysis and co-word grouping and feature-function maps. Today with the advent of big data and the ability to combine data across many different, previous-unrelated databases, the onus on marketing to get really smart about how they use data and what discoveries they find from them is going to be very strong. There’s going to be a huge amount of pressure for that.
So I’ll give you a specific example. My colleague at Columbia, Oded Netzer did a big data project involving the use of the entire Edmunds database. It was a big, involved study, but he was able to use social media mentions from the Edmunds database to identify the General Motors push to rebrand the Cadillac to be more in line with a European luxury car and less like an American family car, which is how many people were beginning to think of it. He was able to demonstrate that that a particular set of investments actually got traction in the perception of the brand using only social media. I think that’s totally different than a lot of the tools that are in the marketing toolkit today.
What could this mean for the average marketer’s career? What does the ability to take advantage of these sorts of transient advantages mean for marketers?
I would suggest – don’t let yourself get stale. My watchwords are – if you come to work every day and all you’re doing is coming to work every day, you’ve got a long-term problem!
Moreover you’ve really got to know what’s going on out there. And I’ll give an example of a friend of mine at a big publishing company. She’d been let go and was meeting with a friend of mine who runs the learning and development department of this particular company. This marketing woman was saying I can’t get interviews. Or if she got interviews, she didn’t get offers because they want to know about things like search engine optimization, big data, social, and she had never had to learn any of that stuff. My friend meanwhile was completely outraged because she had arranged for online courses this woman could have taken advantage of, but she didn’t. The woman just came to work and did her job. As a consequence, she wasn’t even aware that a lot of this stuff was beginning to become a real for any company she considered going to.
So the point is I think you’d need to constantly be thinking about where are your skills in relationship to where the demand is going to be? Are you learning new things? Even if you don’t directly and immediately see the connection between your job and those skills, are you learning something new on a regular basis?
It’s apparent that there’s a missing vital component in the quest to modernize marketing. Today’s marketing organizations are aggressively modernizing, automating and adding more digitally centered marketing tactics as they focus on their mandate to discover prospects and create new customers. To meet the challenge, CMOs have turbocharged Marketing Ops teams and are building their “Marketing Clouds,” leveraging marketing automation to nurture prospects, adding CRM to manage pipeline and customer relationships, while spending millions on branded websites and social pages, coupled with billions on media to promote their offerings. We are not connecting that media investment, the prospects generated, nor their data, with our marketing systems and processes. Integration between the two is a critical missing link.
The prospect marketing effort, which is predominantly driven by third-party media investments in content syndication, search and advertising, is still very fragmented and, worse, seldom measured or optimized. Disconnected and unable to adequately track and optimize media spend, marketing organizations struggle with lead velocity, mixed data quality and a lack of ability to attribute results back to the source or measure ROI. This is a tough hit for marketing executives as they realize how much money they’re actually spending on media to create prospects—$40 billion+ on digital advertising alone in 2013, according to the IAB.
Here are 3 areas of focus for CMOs and marketing pros who are out to modernize their approach in order to drive a higher return on media and technology investment should consider:
Taking action on the missing link is a necessity. If you are investing in media to generate prospects and acquire customers, be certain to connect those media programs with the rest of your marketing systems and process.
This post was written in collaboration with Integrate – learn more about Integrate at http://www.integrate.com
With constant access to a growing list of channels and devices, today’s connected customers are no longer satisfied with vanilla, one-size-fits-all experiences and offers. To stand out in the increasingly crowded and competitive marketplace, many C-level executives from the world’s most iconic brands are not content with just “Keeping Up With the Joneses.” Instead, they are actively seeking opportunities to better understand their high-value customers across every channel and device.
The reason for this is simple: These customers are more often than not brand loyalists and willing to persuade others to become regular brand purchasers if they’re kept happy and engaged consistently in every single place they are interactive with brands. But the task of keeping brands happy and engaged beyond one big “win” isn’t easy. It requires CMOs and the entire business, for that matter, to combine their internal resources with technology that’s both powerful and agile enough to boost customer engagement and revenue long term. And a brand’s success today, in this hyperconnected and digitally dependent environment we live in, depends heavily on leveraging digital to reward high-value customers. Rather than spout out a to-do list of tactics that show high-value customers they’re appreciated, here are some specific benefits instead that can be derived from deep and sophisticated forms of segmentation:
Don’t confuse high-value customers for high-volume customers.
In the less digitally savvy days, brands and their teams of analytics “experts” would navigate through Excel spreadsheets with massive amounts of data. In those days, there was sometimes confusion and lack of knowledge as to what constitutes a high-value customer. As a result, high-volume customers would often be mistakenly categorized, and subsequently treated, as high-value customers. But the reality was, and still is today, that people who interact with a brand frequently aren’t necessarily going to be the ones that have the most value from the perspective of consistent engagement, conversions and sales across multiple channels – from being inside a physical store to making a last-minute purchase on their mobile devices or shopping from their PCs. So it was common for those brands to see a huge surge in traffic for a short burst of time, but after the excitement faded, so did the engagement and ROI.
Marketers today need to adopt a more realistic and accurate definition of value that’s based on “the combination of opportunities to convert and increase potential order value, and maximizes both, while at the same time, yields your highest value customers.” But identifying the best customers online and serving them the content they need is easier said than done. The key to obtaining a 360-degree view of high-value customers means personalizing and differentiating every message by offering an array of online content to drive maximum conversion and revenue uplifts.
To get there, the modern brands of today must, and I repeat must, push beyond the basic forms of personalization – think product recommendations or ads that chase you around on the Web. Instead, these brands are likely to be best served by leveraging the power of technology, real-time data and automated segmentation to effectively profile individuals who are in actuality high-value customers. That identification is the first hurdle that brands need to overcome. From there, it’s all about extending personalization across every device and channel to delight and please consumers with the most humanly relevant, easy-to-navigate and engaging offers.
Tap into the beauty of data to boost cross-channel ROI.
The urgency to identify high-value customers online is being fueled by a number of factors. First, the online channel represents the biggest growth opportunity for most brands. According to a new Forrester Research global eCommerce report, e-commerce revenues are going to continue to grow in 2014 as customers’ online buying habits evolve. Meanwhile, a new study released by IBM in 2014 reveals that brands stand to lose $83 billion due to poor customer experiences.
When you think about it, that’s a lot of revenue that could be left on the table if brands don’t put every segment of their customers first. For example, brands are able to gather intelligence on channels shopped — including Web, tablet, mobile phone or store — and then integrate data from a CRM system, POS, DPM or other source to help augment customer profiles. By combining intelligence on shopping history, search history and Web behavior, this combined intelligence can help brands identify when to offer an in-store promotion, extend a seasonal offer or make a product recommendation. If brands are able to identify their high-value customers, then they can scale the business more efficiently and ensure that every decision and action they make is focused on delivering the right actions defined by the right data.
Discover unique attributes of unique markets.
One common challenge that today’s brands face is a tendency to make decisions based on data points as opposed to data profiles. In these instances, it’s not that uncommon for brands to use pre-existing data models to identify their buyer personas as well as the content and offers they deliver on their websites and mobile sites.
By using automated segmentation and targeting, brands should be able to detect segments unique to their brands and industries. This process turns traditional targeting on its head because buyer profiles and offers are all determined by real-time intelligence gathered against real-time customer behavior. One example of such a data profile could be a “weekend shopper” persona. Based on their digital behavior and purchase activity, these shoppers may spend significantly more money (at multiple channels) than mid-week shoppers. So it’s more than likely these shoppers would be frustrated and intolerant of being shown irrelevant and mismatched offers that would better suit mid-week shoppers. That is where many brands today realize that even with all the benefits of technology, they have made shoppers that much less tolerant and patient with poor experiences.
Move away from campaign analysis; bring it back to the customer.
One of the ways brands have traditionally gathered intelligence on customer behaviors is through basic A/B testing of different content and offers. Building on the quantifiable value of testing, many innovative brands are now shifting from campaign-driven analysis to a more holistic and accurate customer-driven analysis. By doing so, marketers can get a more robust and humanistic view of every single customer segment, as well as being able to identify which segments are performing better than others. With businesses – across all teams – being challenged to consistently demonstrate ROI, this ability to gauge the value of high-value customers and appropriately target them with the best content on the best devices at the best times and places, is especially critical to success.