Tag Archive: CRM

Are You In The Harvesting Business?

As marketers we love data.  We love collecting more and more information about our customers.  We spend an awful amount of time prying pieces of information like first name, last name, date of birth, gender, household income, email address, physical address and cell phone number to build our customer “database.”  I’ve been in meetings where we’ve touted that we now have X million email signups for our loyalty program, players club or recipe newsletter.  That’s great in theory.  I mean who doesn’t want more “hand raisers” or doesn’t want to tell their boss we increased our membership by X %?

The problem is, the theory is wrong.  If you have 10,000,000 members, but only 2,000,000 are active, you have a problem.  If you’re simply collecting, or rather harvesting, names and information you’re missing 90% of the battle.  To win, you need to actually act on those names and that data.  You need to test, learn and retest.  You need to be honest with yourself about your data and admit that when only 20% of your membership database is active, you have a serious problem.  Unfortunately, activating generally costs more than harvesting and we still love to report that we’re increasing the size of our lists.  This is why marketers are happy to harvest names, but squeamish about activating against those names.

Taking this a step further, we’ve become obsessed with “followers” on twitter and “likes” on Facebook.  We report on the number of followers and likes – we believe that more is better than less.  I mean think about it, who doesn’t want more people to “like” their brand?  We run contests and promotions to drive those likes up and up and up.  But, why?  What are you doing with your army of likes and followers?  Are you simply carpet bombing them with mass messaging?  I know many of you are, and isn’t that missing the point?  Wasn’t the point of social that we could be a little more real, authentic and personable?  Wasn’t social supposed to make CRM what CRM was really supposed to be about: relationships?  If that’s the case, why are we spending so much time on harvesting instead of activating?

I think the crux of the issue is that when you have 16,000,000 likes, like Starbucks does can you scale the concept of relationships?  Of course not. It’s simply too expensive to build a relationship and maintain it, for 16,000,000 people.  So instead, we focus on growing the number of likes from 16,000,000 to 20,000,000…because it’s easier.  But, is it a better use of time?  I don’t think so.  Maybe we should be more selective as marketers and opt to focus on smaller higher quality “lists.”  Certainly, it allows us to place the “R” in CRM front in center.  It enables us to activate against people who are actually valuable.

What if the hurdle to join was so high that it ensured only the most valuable, important and relevant people could jump over? We see this approach more and more in how online job application systems work.  By making it more difficult and time consuming to submit your application, the company gets only the passionate and in theory the most desirable candidates.

As marketers, I think we can learn from this approach.  It’s not about harvesting just to harvest.  It’s about harvesting so you can actually turn what you’ve harvested into something valuable…

The Courtship Of Consumer Brand Loyalty

I’m out on blogger vacation this week. The keys to TheKmiecs.com have been turned over to a few, select, awesome guest writers. The following has not been edited by me and is the work and effort of the original author. I appreciate the time and thinking that went into this post and hope you will too. Enjoy!

I am a fan of analogies and I tend to think in pictures so when I try to explain to my non-marketing, brand savvy friends how we attempt to take consumers on the journey to brand loyalty I feel it is best explained through an analogy.  The analogy of marriage of course!

You typically don’t wake up married one day, not that it can’t happen, but it is typically not that easy for a brand without some radically new feature so let’s focus on the other 98.6% of times a brand must embark on the drawn out version of this adventure.

This journey to brand loyalty that makes consumers so committed they don’t even consider the competition and it becomes like a marriage must typically start at square one with the basics…

1.) Your Appearance (Packaging)

Even though they say don’t judge a book by its cover, most still do.  Similarly, how you dress says a lot about you.  It provides the first impression so people invest a great deal of time and money in an attempt to look their best.  Packaging is a similar attempt by brands to dress to impress the consumer.  If it is innovative enough, packaging can be the sole reason consumers may buy a product, like KLEENEX® Tissue Holiday Ovals.  These were and continue to be a tremendous success simply because of their pretty holiday packaging.

2.) The Scene (Targeting/Channel Selection)

Singles tend to visit specific clubs or take part in activities they enjoy (biking, skiing, etc.) in the hopes of crossing paths with other like-minded singles that would appeal to them.  Brands must also position themselves in the appropriate locations (tv, print, online) to find their target consumers based on how and where their target consumers focuses their media attention.  Within these channels they can narrow the lens by zeroing in on certain demographics, contextual targets (such as baby, cooking or sporting content), or by using behavioral targeting.  These approaches allow brands to be more efficient and fish where the fish are.

3.) The Awareness (Advertising)

It may be the person on the dance floor or the quiet unassuming individual that gets your attention based on their appearance and actions.  You are constantly forming and reshaping your opinions as you filter through who and what is appealing to determine if they could be “the one” or at least worth pursuing.  Advertising must also break through the clutter and grab your attention whatever the medium as it attempts to take you from unaware, to a brand you would consider.

4.) The Pick Up Line (Communications)

Once someone has your eye, you have to figure out what you are going to say to break the ice.  As you begin talking, you look to find common interests and the time may fly by if both are truly listening to the dialogue.  Instead of pick up lines, brands rely on funny, informational or impactful tag lines and imagery found on their print ads, commercials or the copy that appears in search results.  The objective being that this is so compelling the consumer identifies with it immediately, wants to learn more and takes action.

5.) The Invitation (Offers/Promotions)

The dialogue continues and you perhaps find this is really someone worthy of your time.  Offers of dinner or perhaps a movie may be suggested for another day.  Similarly, brands look to entice consumers with contests, sweepstakes, coupon offers, or more information to further the relationship.  Based on the possible value of the consumer, the offer may also be adjusted to help ensure the most valuable ones don’t get away.

6.) The Info Exchange (Relationship Marketing)

As this connection is forming, you are likely deciding how trustworthy this person is and how much personal information you want to exchange.  You may start with just your email and phone number or perhaps you decide you are willing to also share your home address.  Consumers make these types of decisions as they interact with brands based on the level of trust established, ease of input and the comfortable they have with the channel they are being asked.  The consumer must decide if they are willing to share a certain degree of their personal information to further the relationship and often times this is in exchange for the brand’s offer that perhaps initially peaked their interest.

7.) The Commitment (Brand Loyalty)

After the first few dates where you find you truly enjoy spending time together you may agree to a deeper relationship based on the bonds and trust established.  Over time you might become so committed that you ultimately agree to marriage.  When brands continue to perform, meeting and exceeding expectations, consumers form a trusted bond that can stop them from even considering the competitors and drives them to pay a premium for your brand, with or without coupons.  At that point they have made a commitment to exclusively choose your brand and essentially are now married or brand loyal.

This sounds easy enough, but I have yet to find the map etched in stone that clearly articulates every step for either of these journeys (marriage or brand loyalty) and no two consumers or brands are exactly alike.  The other reality is that there is no ring around the consumer’s finger once they arrive at this brand loyal status.  As a result, brands must continue to meet and exceed consumer expectations because after even just one bad experience or a major improvement from the competition and you may wake up to find your brand loyal consumer now married to your competitor over night…

The good news, these positive relationships happen every day to individuals and brands so it can be done.  There also are many parallels in both journeys that may help guide you as you look to foster and develop these relationships overtime.

So even though the path to brand loyalty is not set in stone, just remember that communication is typically the key to finding the answers and solving the problem as you embark on either of these journeys!

Written and authored by Kate Johnson – Check her out at on twitter.

My Issue With AT&T’s Pricing Structure For The New iPhone 3Gs

Here’s a simple question. Do you believe that consumer loyalty should be rewarded? Let me rephrase. Isn’t it better to reward your customers for being loyal than to pay them to be loyal through so-called “loyalty programs?”

If you’ve answered YES to those questions, good for you, you understand customer relationship marketing.

If you haven’t been following all the conversations about the pricing structure for the new iPhone 3Gs, let me know bring you up to speed:

  1. Apple announced the third generation iPhone – it’s called the 3Gs. the “s” stands for speed.
  2. If you aren’t currently an AT&T customer, you can purchase the iPhone 3Gs for $199 (16gb version) or $299 (32gb version).
  3. If you are a current AT&T customer, that does NOT own an iPhone, you also qualify for the $199/$299 pricing.
  4. If you are an existing AT&T customer and a current iPhone owner, you get to pay $399 (16gb version) or $499 (32gb version).

So basically, AT&T is opting to reward:

  1. Non-AT&T customers
  2. Non-iPhone AT&T customers – you know, the ones not paying over $100 a month for the iPhone monthly service plan

If you’re an existing AT&T iPhone customer you are out of luck. Huh? The rationale being pedaled by places like Gizmodo, is that AT&T is subsidizing the cost of the iPhone for customers. And, given that existing iPhone users were subsidized once (when they originally purchased their iPhone) they shouldn’t be fully subsidized again. To give you an idea of how much they are subsidizing, a brand new iPhone, with no contract would cost $770/$870. Thus, everyone is receiving some type of “benefit” from AT&T in the form of a subsidization.

You know what? In theory, I don’t disagree with this at all. HOWEVER, and this is the key, if that’s the approach you want to take, then I should be able to buy an iPhone 3Gs directly from Apple and then use that phone with any cell phone service provider. I should be able to use the phone with Verizon, Sprint, T-Mobile, or any other provider.

That seems fair, no? If I don’t want to pay for the subsidization I should be FREE to use any carrier, because AT&T wouldn’t be providing me any benefit. Shouldn’t that be an option?

So, that’s my beef.

Trading Your Personal Information

Every day we trade our personal information for something. Our grocery “loyalty” cards provide companies access to our purchase behavior. The email newsletter from All Recipes gets your name, email address, physical address, and cooking habits. Heck when you buy dinner with a credit card you’re trading away your personal information.

Companies want more of your information. They’ve always wanted more of your information. More data and better data leads to smarter business decisions, more precise targeting, and of course a better return on investment. Simply put, without your data, companies would be guessing about who’s buying, what they’re buying, and would be blindly guessing about where to put their money. Come to think of it, aren’t lots of companies doing that right now :)

But seriously, you are valuable. Well, actually, your data is valuable. As budgets shrink and accountability rises your data becomes even more valuable. If something is valuable, it often means it’s worth paying for. Which begs the question, at what point will we be able to trade our information like commodity or stock exchange?

At the iMedia Agency Summit in Austin, Texas a gentleman from Blue Kai speculated that in the near future you’ll be able to trade your personal information for a trip to Hawaii. The term personal information is loose. You won’t be trading basic information like name, date of birth, and email address for that trip. Nope, you’ll be trading information about where you ate, what you saw, what you bought, why you bought, how many fruity drinks you drank, what music you listened to, and why you ordered octopus when according to what they already know about you, you’re allergic to seafood.

Some people will find sharing that information a fair even exchange. Others will balk at the concept. Me, I’m game. I’d gladly trade a bunch of my personal information for a new BMW M3.

Are you game? What would you trade for a new car or a trip to Hawaii? Would you sell your information? Your middle name might have little value on the exchange, but…allowing someone to monitor your web surfing habits for a year could be worth thousands. Along those lines, would trade your web surfing behavior for free internet? What about your tv viewing habits for free cable?

As consumers become smarter and realize that their personal information is quite valuable they’ll do one of two things:

  1. Protect that information, making it harder for companies to learn about customers
  2. Demand compensation for access to the information

That’s going to change the entire dynamic of the company-customer relationship. It’s going to be fun. BMW, I eagerly await my new M3.

About
Head of Social Media at Walgreens. Interactive marketer, innovator, boat rocker, continuous learner, movie lover, risk taker, dad and all around good guy. I'm always up for a spirited conversation. These are my thoughts and ramblings, not those of my employer.
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