Wednesday, September 28

Automating Marketing: Customer Contradictions

According to the recent 2011 Mid-Year Marketing Trends Study by The Kern Organization, an Omnicom Agency, 48 percent of all marketers have implemented marketing automation this year.

The decision to automate likely lies in marketing's increased desire to capture a mega-avalanche of data about all online and offline sales activities. Simply put, more organizations are being held accountable to their budget and to demonstrate beneficial results of marketing initiatives.

"Today's best marketers have truly embraced the trend of marketing being pushed to drive measurable revenue results," Steven Woods, CTO of Eloqua and author of Digital Body Language. "By being tied to the delivery of qualified leads and new revenue, marketing begins to claim its seat at the strategic table."

But Woods might be wrong because there is an irony here, given what most organizations consider their priorities. Let's consider the other side of the coin (and pretend these companies have the right objectives).

According to Kern, organizational priories are: acquiring a large number of new customers, increasing retention rates and revenues among existing customers, and increasing the quality and and quantity of lead generation (which generally fulfills the first priority). And yet, few firms are asking if marketing automation truly delivers a return on investment. Maybe the hard return on investment is an illusion.

Does marketing automation make marketers smarter or dumber?

Some might argue, of course it does. You can tell by the numbers. You can tell by clicks, calls, and purchases. Effective campaigns are measurable because numbers, any numbers, go up and up and up.

But do they really? Maybe not. For example, there is a retailer that sends me periodic sales emails. It's obviously an automated system, and I have no doubt that someone is measuring the success of each e-mail based campaign. They may be making analytic decisions based on my clicks and purchases.

The truth is that they have no idea why I didn't make a purchase (and they would have no idea why I made a purchase if I had). In most cases, it has nothing to do with their campaign or the emails that arrived on 8-31, 9-2, 9-4, 9-12, and two on 9-25.

 Respectively, I didn't make a purchase because the first three ads arrived prior to my credit card statement, which carried incidental charges related to our last vacation. The middle one landed on a Monday, which always means a fuller inbox. And the last two? I was too busy to read the first; and I was thinking about how much paint I need for the family room when the second one arrived.

 Marketing analytics will never tell them this. But I am sure, somewhere, someone is racking their brain to guess why I (and all the other collective people like "me") didn't respond to their sale. I can almost see their guesswork in the later advertisements. They had brighter colors, bigger fonts, bolder messages with more urgency.

Except their message wasn't urgent. Frankly, their sales messages were among the least important things in my life (except for those other marketers whose ads have long since landed in my spam folder).

Anymore, the hardest thing for marketing to grasp is the long term.

The rush to automate marketing isn't the only tell. It's how many organizations view social media. According to the Kern study, only six percent of these companies see social media as very important. Only 32 percent said it was important.

In fact, most organizations (87 percent) said they will be investing 0-25 percent of their marketing budgets in social media. And not surprising, 77 percent were not satisfied or only somewhat satisfied with social media.

Mobile isn't much better. About 34 percent reported no mobile budget for the next twelve months. And even among those who see it as important, they are focusing mostly on mobile web and content delivery.

So why do social media and mobile take a back seat? The same reason so many of these firms have jumped on marketing automation. Numbers do not always favor social media in the short term. Any campaign that lives and dies by a tweet or klout counts tends to move in a reactionary direction.

And there is the irony of what is starting to shape up as modern marketing. There is growing propensity to measure everything to the point that the information obtained measures nothing of importance.

It's no wonder that the same study placed 38 percent of these organizations as only somewhat satisfied with their marketing and only 20 percent very satisfied or better. When your entire satisfaction is based on short-term lead generation, new customers, and repeat sales on the fly, it's hard to find happiness.

Of course, if the retailer that emailed me six times in a 30-day widow really knew me as a customer, they would know that they've already temporarily won the long-term marketing war.

Their jeans fit me better than other brands. So, all it takes for them to sell me jeans is my need to buy a new pair, whether or not they send me a sales email. In fact, if they sell four pairs at 40 percent off next week, I won't need any more for awhile.

In effect, one random sales purchase could make every subsequent campaign (even if they are better campaigns) look dismal in comparison based on nothing more than random chance. And that's the advent of automated marketing. Weird, isn't it? They could cause their own sales decline, thinking it was a success story.

If you are interested in the traditional white paper, you can find it on their Marketing Trend Study page. Requesting the white paper will require typical lead generation information: name, address, email, phone number, etc.
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