eCommerce Tips -- Part 2

Part 2 of eCommerce tips...  look for Part 3 coming out shortly.

Scott

1. Executive Management — typically you’ll find Executive Management has the misconception that once the site goes live the dollars will start rolling in immediately.  As we know this is absolutely ludicrous — the site needs to mature, have campaign dollars spent on it, let alone ensuring the search engines start indexing the site.  Make sure you are DAMN clear by always saying the site won’t generate a single sale for 6 months.  Start your conversations and end your conversations with this important point continuously.
2. Timelines — first, you won’t hit your original timeline.  Live with it.  And if you do, you’ve probably left something off which is critical.  Second, timelines should be built on quarters not months.. it will give you some leeway and is actually more accurate in the end.
3. Privacy and Security — you must make your site bullet proof… your customers data and personal information is critical.  If you’re not going to take the time and money to make your site safe against malicious or accidental incidents then you shouldn’t get into eCommerce.  Hire an eCommerce security and privacy consultant to put the processes and security protocols in place.  This is the most important development and process area when you develop your eCommerce site.
4. Currency — get a currency converter on the site so your customers can understand the true cost in their preferred currency.  Get the data from a company which updates currency rates during the day.  I like to bill in US dollars and collect the money in US dollars vs. the hassle of taking conversions later.  It doesn’t impact the customer as they pay the same on their credit card.  
5. Embargo countries — remember, the US and EU prohibit companies to do business with certain countries e.g. Iran.  So ensure your system is setup to reject these sales.  I’ve always kept the order data in the eCommerce system so I had a record of the failed transaction.  That data could come in handy one day.
6. Trigger on multiple purchases — got caught on this one once.  Someone pinged the site and made multiple independent purchases, paid for them with the same card and they all went through.  Of course the card was stolen and they got some free content.  Put a limit on multiple orders from the same card, address, etc. which can be done during a certain time period.  It will help eliminate another area of fraud.
7. Cross sell across the entire site.  “People also looked at these products”, “People purchased these products as well”, “Consider these companion products”…. are key on the site.  Merchandise the site aggressively.  Tip… if you’re using one of the big platforms, you’ll probably use an algorithm which will personalize these recommendations.  But it will take time for the algorithm to learn…so hard code some cross sell products on the site until it gets enough data.
8. Search engines — once you’re open for business, Google, Yahoo!, Bing, etc. will start sending down search bots to begin indexing the site.  Note… keep the content up to date, fresh and at the top of the site.  It will make it easier for indexing and will keep the bots happy.  Also, everyone focuses on Google but don’t forget to keep things simple for the other engines as well.
9. Shipping costs — free shipping is all the rage during the holiday buying season.  And certain free shipping promotions can help drive purchases as well.  When you’re building the system check that the rates for each shipper you use are accurate.  
10. Handling costs — wonder why you can “get 2 ShamWows for the price of 1”… just pay shipping and handling?  Because handling is another way to get profit.  Yea, you might need to have someone pack the stuff up and that costs you…but using handling costs for profit enhancement is a good idea.  I’m 50/50 on this practice.  It’s nice to have the extra profit, but I question whether it’s worth the possibility of pissing off a customer.   
11. Shippers — I like to use multiple shippers.  UPS, USPS and FEDX.  If overseas, DHL is a good choice.  As delivery methods, costs, time etc. are different, the variety provides your customers with choices.  But, that choice means your systems and logistics need to be setup to accommodate the different shippers.  Making labels, putting in a tracking number etc. should be integrated into your eCommerce logistics.  Speak to a logistics specialist.  And when looking at 3rd party software, see if this is an Out of the Box feature or if you have to buy additional software.
12. Distribution of product — when you start out your site, it might be easy to just have the mail kid pack up the stuff and send it out.  However, be ready to quickly put more resources into product distribution at any time if/when product sales increase.  By the way, make sure you look professional when you distribute your products.  Don’t throw them in a box without proper protection material (styrofoam peanuts, bubble wrap).  Show you’re environmentally responsible by using recycled eco-friendly materials  And don’t hand write the mailing label… print it out professionally.  Tips… include your latest catalog in the box, a thank you note, a coupon for future purchases, etc.  
13. Right products — its key to get the right ones on the site…that’s easier said then done.  It’s a test and learn process… so switch it around.  
14. Right price points — with anything else, getting the price at a point which maximizes profit while maintaining competitiveness will be key.  Set up a site scrap of competitors sites for pricing.  It can help you keep your prices competitive.
15. Consider credit card limits — if a customer can’t pay for it, they can’t buy it.  Credit card limits vary, but it’s easy to determine that the more expensive the item you’ll probably not have as many buyers.  And business credit cards usually have a limit of $5,000 for travel and expenses… Purchase Order Cards can be higher, but I’ve always relied on the $2,500 top end for business card purchases.  Anything above that on the site, will probably require an employee to get a purchase order.
16. Credit Cards — my view… accept as many types as possible.  MasterCard, Visa, Discover, American Express… if people have them, they use them.  The discount rate is always a big concern as its an expense… some sites don’t accept AMX for the high discount cost they charge.  Yes, it can be 100 basis points or more in cost, but I’ll take a bit less in profit to get a new customer any day.
17. Purchase orders — if you’re focused on businesses you should have the ability to purchase using a PO number.  This is going to require integration with your back end finance systems and isn’t a trivial development task.  
18. Tax consequences — for the love of God, charge tax.  It sounds like a no brainer, but I’ve seen sites which don’t do it.  For most products you must charge tax.  If you don’t charge YOU will pay the tax for your customers.  That usually means you’ll lose 5-8% profit.  Hook up the eCommerce tables to accurate tax tables.
19. Backup servers/systems — it sounds like a no brainer as well.  Keep it in mind when you setup your site on a 3rd party server provider.  Find out how the procedure works, what defines “an outage”, timing until the site comes back up, etc.
20. Get em in, get em out… I’m probably in the minority on this, but I like to get people on the site, have them find stuff quick, pay for it and then decide to leave or hang around after that.   If your on site metric is increasing and sales are decreasing it’s more than likely that your customers can’t find the product. Look to lower your on site time while increasing your sales at the same time.

Thou Shalt (or not) for 2016....

10.  Thou shalt audit media schedules… ensuring any media rebates are spent expeditiously.

9.  Thou shalt refer to “sales” in conversations regarding marketing… e.g.  “Advertising which drives our sales funnel.”

8.  Thou shalt not spend precious marketing budget on items which don’t drive revenue.  

7.  Thou shalt create compelling content which engages clients.

6.  Thou shalt create media spend plans before spending all marketing budgets on creative development… ensuring proper media levels can be achieved to reach thee lofty sales goals.

5.  Thou shalt actually measure sales activity associated with marketing… true sales/cash register ringing, etc.

4.  Thou shalt have open, honest communications with vendors and agencies.

3.  Thou shalt not spam customers with email.

2.  Thou shalt integrate marketing and communication tactics to create a marketing ecosystem.

1.  Thou shall put together a Marketing Strategy and Plan based on revenue goal attainment, measure and communicate results. 

Scott

2016 Marketing Budgets -- a Few Tips

It’s baacckkkk… Marketing Budget Planning

Glistening Christmas lights, the smell of cookies in the oven, carolers singing the traditional holiday songs and the task of getting your marketing budgets done.  A few thoughts on budgeting.

1. Inflation — take it into account on production, agency fees, etc.  I usually figure about a 2% y/o/y increase.  Media inflation can be a wild card, but check with your agency on an estimate. 
2. Zero based budgeting — I like it.  It helps me apply the appropriate amount of marketing funding needed to reach the sales goals of each product.  In addition, it gets those nasty conversations you must have with business groups which won’t receive financial support before you get into the new fiscal year.
3. Cut the fat.  It’s the time to look at results and make the hard cuts.  If something isn’t working get rid of it.  Stop wasting precious financial capital.
4. Staffing — get your plan together early.  Do you need to upgrade talent, cut non-productive employees.  If so, ensure you’ve budgeted appropriately.
5. Run Rates — get those campaigns aligned and your budgets as well.  Nothing is worse than the decision to create a campaign, but not have the money to carry it out.
6. Capital — work with finance to understand your capital requirements.  Does this get charged to your budget?  Or is it paid out of a “pool” of funds at the corporate level?  Retiring capital investments sometimes helps the company’s financials.  Taking on a new capital project not only impacts capital finances but also operating expense.  Not everything can get charged to capital… so ensure you have the operating expense planned for as well.
7. International — work with finance to understand the impact currency rates will have on your budget.  If the US dollar can’t buy as many UK pounds, you’ll need to budget more to have the same media impact, etc.
8. Agency negotiations — if you’ll be negotiating a new contract… take a look at my post on contract negotiation.
9. Tracking — setup very detailed tracking of your dollars.  The amount spent of different  media types, how much goes internationally, how much you spend on campaigns, business units, fees, creative, etc.  It helps in understanding profitability of marketing and will help you plan for 2017 budgets.
10. Special initiatives — they will come out of left field, so build some buffer into the budget and understand where it sits.  Finance loves to pick at the “miscellaneous” budget line.

Good luck in the coming year.

Scott

I Don’t Get It?

I’ve never claimed to be the sharpest knife in the drawer, but I’m also not the dullest.  Sometimes, marketing is as much about common sense as it is about creative and analytics.

The first example is a sight named Second Life.  You might remember it as the rage back in the early - mid 2000’s .  You could create an Avatar of your liking, walk around and interact with others in a virtual community atmosphere.  Long story short… a number of tech companies including IBM, Dell, etc. were creating virtual communities where Avatars could interact with the company, it’s representatives and other Avatars.  Although you couldn’t purchase anything, you could walk around and have conversations.

Dell created “Michael Dell’s Dorm Room”… a recreation of where Dell stayed and started the very successful Dell Computers.  Avatars could interact with Dell Avatars, discuss computer options, etc. But they couldn’t purchase items through the store.  I actually went in and try to order a PC, but was told I needed to go to Dell’s website to place my order.

What was being sold on the site were “virtual goods.”  For instance, you could buy virtual clothes or items for your Avatar.

Creating these communities wasn’t cheap… Six figures wasn’t unusual… time on coding, licensing, creative, etc. adds up pretty fast.  Plus, you had to staff your site with individuals to be your Avatar representatives.

Naturally, given publicity around Second Life, a large number of Marketers were pushing for funding to create an HP Second Life Island.  The big question I continued to ask was, “Why?”  The answer was always, because our competition is there.  When I asked the question, “How to we make money using this site?”  No one could answer the question.  Could you place an order?  Nope.  The grand idea was to have seminars on the site.  Really?  We’re going to rely on the site to get the correct people at one of these events?  These people are going to just “show up”… we advertise and they shall come?  That might work… but again, how do we make money?

Long story, short.  We didn’t put the sight up as no one could answer the question.  Perhaps saying “I don’t get it” worked this time.  If you don’t understand it, don’t do it.  It’s simple, don’t invest your Marketing dollars if you don’t understand the payback.  It sounds easy, but how many times do we rubber stamp media plans, creative ideas and the like.  Start taking a deeper look and asking if you get it.  You might be surprised how many things you start to question.

Scott

Weekend Humor Video…. How to Redesign a Stop Sign

Ok, we all need to laugh at ourselves… start the weekend off with a video about how insane we clients can be…Enjoy and laugh.

Hot to Redesign a Stop Sign

Scott

YOWSER…. $5M for a 30 second Super Bowl Ad!

AdAge announced today CBS has nearly sold out all of the TV inventory for the upcoming Super Bowl airing February 7th.  Prices are at $5M for a 30 second spot or an 11.1% increase year over year.

I can remember buying a 30 second spot for a mere $1M around 12 years ago.  I can’t believe I just said “a mere $1M”….

I’ve always had a love/hate relationship with Super Bowl advertising… the ratings are massive, people focus in on the spots and messages.  Digital integration is becoming stronger so the spots live on post airing.  And naturally, if the creative is killer, everyone is talking about it for weeks.  Then again, if the creative or message is poor… you die a quick death of ridicule by late night TV hosts and you’re forever known as the media guy who pissed away a ton of money.

Needless to say, I’ll be tuned in February 7th like most of America, looking at those spots like everyone else.

Scott

The Dumbest Guy in the Room

For anyone who’s sat through a meeting with me… I often say “I’m the Dumbest Guy in the Room.”  I also tell folks the reason I know, is my wife tells me every night I get home.  Now I jest about the later… but former is absolutely my goal — to be the dumbest guy in the room.

However, I’ve sat in too many meetings where a high level Marketing Executive, Creative Director or Business Manager doesn’t listen to what is being said — by their team, agency, research team and what’s even more concerning… the customer.

Getting customer input is critical.  Once I did extensive research on how customers found our products.  How they searched, categorized and navigated on a website.  Presenting the results to Product Management was interesting.  At first they were intrigued, almost giddy with the insights from customers.  That intrigue quickly became skepticism as they picked apart every number, comment and recommendation.  

• Use a third party research company
• Include Product Management, Marketing, Executives or anyone who might throw stones at the results.  Include them from day 1 in the design, purpose and question/research development.
• Use multiple customer segments — B2B, B2C, size, geographic, income, sales, etc.
• Speak to customers and prospective customers
• Video tape the input or better yet, have your key constituents actually be at the interviews to listen to input for themselves
• For a website… setup navigation pages for customers to test… if you have the budget, you can go all high-tech and have eye navigation and tracking setup. 
• Get the correct sample size
• Get quantitative and qualitative input… it’s tough to argue with the quantitative numbers, but having the qualitative helps bring the context of those numbers out.
• Get agreement at the outset, what you want to get out of the research.  Agree that you’ll use the research to make certain decisions… basically, you don’t want the research to find it’s way on a dusty bookshelf
• Do an in-person results meeting… and follow it up with individual 1:1 meetings to ensure clarity and get consensus if needed.
• Layout a step-by-step plan to execute the plans the research has identified.  Always tie back the recommendations and changes to the research…bring it back to the customer research

Don’t let that research sit on a shelf… don’t let others “poke” holes in the research based on inaccuracies with the collection of the data…don’t keep the results under wraps…and most importantly, don’t think you’re smarter than your customer.  

Scott

Exorcism -- The Live TV Event

Exorcism …. the word conjures up visions of pea soup being vomited across the room.  Last night the live broadcast #Exorcism aired on Destination America.  So I watched this live train wreck of a show.  I mean who the hell doesn’t like to see a good exorcism every once in a while.   Frankly, I could care less of whether the boogie man exists, if a house is possessed or whether the dead can talk beyond the grave.

Actually, what intrigued me the most was who would advertise or potentially sponsor such a program.  It’s not everyday you can say “proudly sponsored by …” on a show which might have some guys head doing a 360 degree turn while demons escape from his body.

My gut told me the advertisers would be company’s which tend to be direct response oriented… low priced/high volume of spots with possibly some local stuff thrown in — car dealers pushing end of the month sales, etc. 

Drum roll… those which were advertising included:  Geico, Jimmy Dean, Bass Pro Shops, US Army, Reese Peanut Butter Cups, Fiat, Select Life Insurance, Proactiv,  Sylvania Car Light Bulbs, Pampers, Little Caesars, Thermo Spas, Dish Network, Subaru, etc. etc.

My thoughts… great placement for the high volume/low cost spot providers — Insurance, US Army, Caesars, Dish, Proactiv, etc.  The content was crazy appealing (to the right demo), kept people glued to the TV to see what the whole exorcism would entail.

What I questioned were Fiat and Pampers.  The brands don’t seem to fit the programming.. there big brands, targeted niche markets, etc.  The only thing I could think of is with Pampers you could make the leap to “crapping in your pants” from being so scared.

The show was a total bust, but honestly I think the brands who advertised got their money’s worth.

Scott

Telephone Books — The Indispensable Tool in the Recycling Bin

Last week I heard a “thump” against my front door… when I looked, it was a phone book which had been thrown on my porch.  It wasn’t a big phone book — you know those separate white pages book and one for the yellow pages.

I remember the first thing I’d do when the new book came out, was to quickly scroll to my name and make sure I was listed and the address and phone number were correct.  But when I brought the phone book in, I promptly threw it in the recycling bin.

So the phone book has gone the way of so many other “analog” properties.  Having been chased out of business from the 1 and 0’s of digital.  The phone book has been converted to digital… but, you can find out so much more than just a name, address and phone number by typing your name in a search engine.  Plus, you can find out everything from criminal records to legal documents…

How the world has changed… but sometimes I yearn for the days of thumbing through a phone book to see my name in print.

Scott

Marketing is Sales — Learn to Live With It

As Marketers we continually screw ourselves every time we open our mouths and spout out… the brand, advertising, radio, tv, print, events, digital, creative, marketing “expense”, media, etc.

All of those terms scream — Expense!  It reinforces the misconception that all marketing is expense… and people outside of Marketing (e.g. Finance/Sales, etc.) keep thinking “why do we spend so much money on this fluff.”    

Whether we like it or not, we Marketers have branded our work expense.  So every time the company needs to cut expenses… the Marketing budget is the first stop.  And the self fulfilling prophecy of cutting the budget which decreases the effectiveness/metrics gives critics more ammunition that Marketing just does “stuff”.

Learn to live with it folks… Marketing is Sales!  Yes, we are Sales People.  Damn it, we’re in Sales!  Why??  Every single dollar spend on Marketing should drive sales.  Think about it… why would Company Executive, Board of Directors and Shareholders support the expenses associated with Marketing.  Because they expect… no demand… that sales will be positively impacted by the expense.  

Marketing Research

Advertising

Creative

Media — TV, Digital, etc.

Direct Mail

Database Marketing

Marketing Operations

Technology

Web Sites

Headcount 

And the list goes on and on…

We must change the language first… we need to add the word “sales” into our vernacular.  

Sales drive by advertising

Sales Web Site

eCommerce

Web leads

Demand generation sales

Advertising sales / lead generation

Sales customer research

Events which drive sales leads

Sales metrics

The change in language starts to change the way our budgets are looked at.  Now we can start dialog around cutting budget cuts sales.  Finance and executives will now be forced to reconcile budget cuts on sales drivers vs. marketing expenses.  It’s a hell of lot easier talking about how those budget cuts will impact sales vs. how GRPs or brand awareness will be impacted.

Scott 

Agency Rebate Allegations – “RebateGate”

In the October 20^th issue of Advertising Age, it was reported that the ANA and the AAAA’s have come together to investigate allegations of “agency rebates.” 

Basically, the situation(s) is this:

-          Media agencies purchase media on behalf of multiple clients.

-          Media companies have allegedly provided incentives to agencies for buying more inventory from       them.

-          The agency then received a “rebate” for spending more money with one media-company.

-          Rebates haven’t been passed back to clients but pocketed by the agency.

-          Clients have been kept in the dark for the most part regarding this practice.

This isn’t anything new… it’s been going on for years.  Media audit companies have been pointing it out to clients for a number of years.  And savvy large advertisers have been able to claw those dollars back.

The rebate situation brings up:

1.       Transparency – why haven’t clients been informed of these rebates by media companies and others?

2.       Trust – if the “value” of a media agency is to strategize, plan, measure and frankly buy media at the lowest possible cost for clients… how do I know they’ve been purchasing the right media for my campaigns? 

3.       Motivation – is the agency motivated to meet my needs or thinking about how they can make the rebate?  And, have those fees helped make up the delta for lower costs on media buying fees paid to the agency?

So what to do?

1.       Ask the question of your agency – Are you receiving any rebates from any media partners, vendors etc. for the work you do on behalf of my company?

2.       Hire a media audit company to look at the media and vendor purchases… audit the numbers and report back on rebates and other financial concerns.  Hopefully, a clause such as this is included in your agency contract.

3.       If rebates are found, have the amount calculated by a 3^rd party.

4.       Ask for a rebate check, not media credits or agency fee credits.  A check makes this a clean transaction, getting media or fee credits will just make things more complicated.

5.       Current agency fees – make sure you keep an eye on any additional fees which might start being applied to your bill.  This could be to make up for any media rebates which might be taken way.

6.       Future Negotiations – when you look at negotiating for a new term (or with a new vendor/agency) make sure you understand if fees are going up because rebates might be taken away.

7.       Quarterly Review – if you don’t already do it… start a review to keep this and other potential issues in the windshield vs the rear view mirror.

8.       Provide very clear contractual language on rebates, etc. in your agency contract

9.       Make it known to media companies your input on this situation.  It’s your money the media company gets… so they will listen.  As my Dad would say you need to have a “come to Jesus” conversation with them.

10.   Follow the Money – this is a simple situation to follow who’s getting the cash and why.  Start investigating.  Don’t stop with the agencies … look at media companies as well.

If agencies aren’t transparent with clients… it will eventually come out.  It might take some time…you can run, but you can’t hide.  And if this investigation yields specific names as to company’s potentially involved in the rebate allegation… restoring trust of clients will be tough…and explaining this at pitches is going to be interesting to say the least.

Getting in front of the Marketing community with your cocker spaniel named “Checkers”, getting on TV and saying “I am not a crook” or getting rid of 18 minutes on tape… ain’t gonna work. 

Scott

Gotcha’s When Hiring an Agency

• Overhead
• This is one of those “hidden” expenses which tend to slip through the cracks when discussing compensation with an agency.  Usually the cost per title/person is discussed and negotiated, but overhead is where the agency makes up or adds profit.  I’ve seen overhead, etc. 32-52% above the cost per person.  The question you should always ask is why am I paying for the electricity when they have a ton of clients…. How is that separated between clients?
• Bonuses
• Look I’m not beyond saying people shouldn’t get a bonus.  But make sure you understand how it’s calculated and the process associated with determining who gets what and the amount.  If it’s not coming out of what you’re paying per person, but the agency profit… they can do and should do what they want.
• Staffing
• Miss-aligned staffing is a big issue.  You have to decide the type of staff you want on the account.  But be wary of high dollar agency executives being billed on the account.  Are they adding value?  Or are they just pressing the flesh?  My starting goal has always been to have 40% on executive billings and the rest on lower level staffers – this way the agency gets off to a good start and transitions quickly.  Then over time, I like to move the percentage split to be 20-25% over one year for executive management and after one year approximately 15% with the rest being staffers. 
• Billing
• Media invoicing usually takes some time to consolidate and validate billing… with some taking 120 days to be completed.  However, having the agency NOT bill you for headcount or media on a consistent basis – or not calling out problems with billing is an issue.  Monthly you should get a list of invoices not paid and the date of the invoice.  If they don’t provide it, make sure you have agreement you won’t be responsible for invoices you haven’t been informed of after 1 year.
• Indemnity
• This is always the “big issue” in all the negotiations.  As clients we want to hold them responsible for everything, and agencies don’t want to be held accountable legally.
• My take – they should be responsible for the work product.  For example if an employee steals code from another company… the agency should take the hit.  However, if the client doesn’t do the appropriate trademark search when the agency wasn’t asked to do so… the client is responsible.
• Also, don’t get so hung up on this… use common sense.  Remember, your legal department is geared to limit as much risk as possible.
• Overstaffing
• Yes, the big issue… let’s get it out on the table.  It’s in the nature of most businesses to add staff to grow.  Frankly, I believe that’s the wrong strategy, especially with the agency.  You should work to decrease the number of staff by 2-7% per year… this forces you and the agency to get more efficient and eliminate non valuable projects or processes.
• Auditing
• You must have the ability to audit at anytime – period.  Naturally, you shouldn’t have access to individual employee’s records, but you should have the ability to look at time cards, etc. 
• It’s a good practice to audit every 18 months – even it’s just a spot audit.
• Also, hiring an audit company experienced in agency audits is a plus – they can ask the tough questions, take the heat with the agency, etc.  Make sure that’s included in the contract as well.
• Reviews
• Quarterly performance reviews are critical!!  Sitting down with the agency team and saying “what could we have all done better?”
• If you don’t do this on a continual basis, improvement won’t happen and you’ll quickly end up in a “blame the agency” situation.  And that usually ends up in an agency review.
• Non-Compete
• Ensure you have a minimum 6 month non-compete regardless of whether you or the agency discontinues the relationship.
• Media
• Consolidated media buying offers clients the benefits of reduced costs as their buys are integrated with other clients.  Here’s the rub… some media outlets will provide additional bonuses back to the media agency buying arm.  Some agencies pocket those bonuses themselves, when they should be split and given back to the client.  Make sure you get those extra media bonuses back in your pocket!
• Make Goods.  Ensure your contract includes the use of make goods prior to utilizing your media budget for the same property.   You’d be surprised how these can become a surprise.  

What a Drummer Can Teach Us About Business?

So that headline grabbed you.... if you look at other areas of the world you can see bits of brilliance which can be transferred to marketing.  Take for instance Fede Rabaquino -- a drummer from Europe.

If you check out his video channel, you'll see he takes current or old songs and adds his own "drumming flavor" to each song.  Not only does is change the way you experience the song, but in my opinion makes the songs sound fresh -- in otherwards, utilize what's already worked and just put a new spin on it.

In an age of business budget constraints, pressure on margins, etc.   Why do we insist on coming up with a "new" campaign or initiative everytime?  Why not be like Fede and look at the work from a different perspective...

Enjoy his latest video.... a new take on AC/DC's "You Shook Me All Night Long"

Scott

What Kind of Business Should You Strive to Be?

It’s questionable today whether the economy is actually getting better.  But regardless, one thing I was taught was how you should focus your business for not only the short but long term. 

Good Companies -- cut costs

Great Companies -- cut costs AND increase gross revenue AT the same time

Outstanding Companies -- cut costs AND increase gross revenue AT the same time AND CONTIOUSLY over time.

Which are you today?  And more importantly what kind of company do you want to be?

Scott

Are Our Metrics Focusing on the Right Things?

It seems like every other email newsletter I receive has articles regarding metrics about social, mobile, engagement, likes, content views, GRP’s and the like.  And I’m not disputing the point of each of these are important in their own universe…. And if you can connect them, all the better.

However, let’s go back to the fundamental reason for marketing.

“All marketing investments, across ALL areas/functions/businesses, etc. is to do one thing…SELL”

     

If the above weren’t true, why would the board of directors, management and shareholders agree to marketing budgets?  Marketing is a fundamental investment with both short and long-term financial goals.  Short-term – sell product immediately, drive leads for sales, increase eCommerce traffic…. Long-term – build the brand, create advocates for the brand, drive high value leads, increase price, etc.

Which brings me to my concern…it seems to me we’ve taken our eye off the ball on the metrics which truly matter and support the reason for marketing investments.  So what top-level investment metrics should we regain focus on?  My key ones include:       

1.  Incremental Gross/Net Revenue per total marketing dollars spent

2.  Customer Acquisition Cost

3.   Both #1 and #2 but revenue per marketing employee

4.  Customer Cross Sell Ratio

5.       Recency/Frequency/Monetary Value customer model – check out Don Libey’s extensive research on this model

6.       Customer Satisfaction Levels – get down to specific detail items you’re working on and track them consistently

7.       Customer Lifetime Value

8.       Marketing Investment Payback Time

9.       Customer Attrition Rate

10.   Customer Segmentation Model and Marketing Investment

Certainly, I have additional ones I could list, but keeping things simple--the above 10 help focus your investments, strategy and executions on the things which matter.  In addition, when the boss calls you in the office, you speak management language vs. the marketing babble.

Scott