Tuesday, December 9, 2014

NPS and Marketing

Too many people look at the Net Promoter Score (NPS) and think that it’s a metric that’s only useful to the customer service organization when, really, it’s a very useful tool for marketing as well. It goes a long way toward telling you if your customers are happy and loyal.

What is NPS?

NPS can be measured using three different surveys. The Relationship Survey measures the overall sentiment of your customer and reflects their feeling toward the organization based on their entire relationship with it. The relationship score is determined by asking “How likely are you to recommend the organization to a friend or family member, on a scale of 0 - 10?” The Transactional Survey measures specific “moments of truth” in their relationship with your organization. It’s sent after an interaction with the organization and is usually in the format of “How was a specific experience on a scale of 0-10?”
The Internal Survey is designed to understand what kinds of interactions your internal customers are having with your department. This might involve an analytics team sending a survey to the customer they are creating the analysis for.
I find it’s also very beneficial to add a qualitative question such as “What’s the reason behind your score”? You could find that you have an entire customer segment you are pursuing that may not be a good fit. You may get suggestions for how to improve a product. The possibilities are endless.
The results of the survey will break customers down into the following three categories:

  • Promoters (9-10): Loyal enthusiasts who will stay with the organization and refer others, fueling growth.
  • Passives (7-8): Satisfied but unenthusiastic. They’ll neither promote nor detract and are vulnerable to switching organizations.
  • Detractors (0-6): Unhappy customers who can damage the brand and impede growth.

Closing the Loop

This data doesn’t do anyone any good if you don’t turn it into actionable improvements. Depending on which journal you read, customer feedback is ignored 50%-75% of the time so use this opportunity develop an action plan determined by how the customer responded to the NPS Survey. Start developing lists based on the where someone falls in the NPS Survey or, if you’re managing the digital marketing program, you might develop a trigger based on a survey answer.
  • Promoters may see loyalty program offers arrive in their e-mail or via SMS. They could be invited to interact in your social media efforts.
  • The Passives are eligible for a number of efforts designed to move them from Passive to Promoter.
  • A Detractor’s response might trigger a landing page or an open-ended questionnaire asking how the organization failed them and how it can be corrected.
The NPS can help you better understand your company’s reputation and refine your customer segment. You have the potential to improve customer experience and the bottom line. The marketing uses to which you can put this data are varied and impactful, but only if you actually use it and keep the momentum going.



Wednesday, November 12, 2014

Influencer Marketing - Leveraging a New Target

The voice of the customer has always been critical to developing the marketing message and influencing the purchaser decision and word-of-mouth has always been the most trusted source for product and service referrals.
If you want a new doctor, who do you ask? Family members, neighbors, co-workers. You may go online and do some research, but usually you'll ask a peer for a referral or opinion as well. The same is true of a new TV, computer, dog food, or any other product or service. An interesting, and important, development to note in this new age, though, is that suddenly an opinion from a single person is going out to hundreds or thousands of individuals in their social network. According to a McKinsey Study, word-of-mouth generates twice the sales of paid advertising and has a 37% higher retention rate. The resulting amplification of peer recommendations cries out for a new marketing tactic. This is where Influencer Marketing comes in.

What Is Influencer Marketing?

Influencer Marketing is when the focus of marketing is turned from a target market to key individuals within that market. They may be buyers themselves or they may be third parties, such as vendors or subject matter experts. It basically depends on the individual's reputation, expertise or popularity. This used to mean a focus on bloggers, celebrities, etc., but in recent years the everyday joe may have just as much influence. Forbes provides this equation for determining influence:

Influence = Audience Reach (# of followers) x Brand Affinity (expertise and credibility) x Strength of Relationship with Followers

This form of marketing may mean entering into a relationship with the influencer. You might provide them with advance prototypes of a product or invite them to the corporate offices. Unfortunately, there are also drawbacks to this type of marketing. You don't have as much control and if the influencer runs afoul of the law or drops out of the grid, it will be time for some damage control.

What You Should Be Doing

  1. Interact with your customers.

    You really need to leverage your customers. Provide a superior customer experience through loyalty programs, customer advisory boards, or extraordinary promotions.

  2. Identify the Influencers

    There are a lot of tools available to help analyze the social media landscape to determine and rank the influencers. SocMetrics and Traackr are just two tools available to help you identify influencers based on demographic data. Additional options are listed on TopRank Blog.

  3. Form a Relationship with the Influencers

    Start off with a simple hello. Take steps to familiarize them with your product or service and company. A little kindness and generosity goes a long way.

  4. Provide Accessible Content

    Influencers are more likely to provide content that's easy for them integrate into their social media portals. Again, there are a number of tools, such as Zuberance and SocialChorus, to assist you in your brand advocacy efforts.

  5. Don't Forget the Little Sites

    Keep track of the trends of social media sites. You never know when the one you've been ignoring, like Pinterest or Instagram, may be the next big site.

Influencers are the wave of the future and it's our job as marketing professionals to take advantage of every possible resource and be aware of marketing trends. As Scott Cook, the founder and CEO of Intuit said, “A brand is no longer what we tell the consumer it is–it is what consumers tell each other it is.”

Monday, August 4, 2014

5 Tips for Improving Your Sales Forecasts

For many, sales forecasts are the bane of their existence. They can be inaccurate, hard to understand, and require constant supervision – something like a teenager. In many cases, they’ve been manipulated to reflect the desires of the creator or recipient, rather than being left to reflect the pure data. I’m going to provide you with five simple tips to make them more manageable and useful.

1) Know Your Buyer

Too many lists are based on historical data without taking into account buyer behavior. However, think about it a minute – what makes the sales process happen? Buyer behavior. Where is the buyer in the buying cycle? How will they buy? Where in the decision-making process are they? With a clear understanding of what’s driving the buyer, you can create a more accurate forecast.

2) Understand the Sales Strategy

A good sales strategy takes into account the needed outcomes to achieve the business’s goals. That said, there is no one true set of numbers for sales strategy. You may have a number for each of the functional areas involved in achieving those goals: the sales team might have a number they need to achieve their goals, but product management will want a product-specific number, and finance will want revenue numbers. Why are these important? Because a more accurate forecast can be achieved if you understand the pipeline process and where in the lifecycle an account or product is. In the same vein, don’t fudge the numbers to target what you want to achieve. Be realistic. Remember, sales forecasts are not sales targets: the forecast should reflect what you can achieve, not what you want to achieve.

3) Continuous Improvement Is Key

Remember that a sales forecast is a picture of a moment in time. It doesn’t evolve or track anything that’s happened after you take the picture or when new information appears. Be prepared to manage the forecast. It will need updated or modified as additional information becomes evident. When managing the forecast, don’t ignore or eliminate the outliers. If the forecast line starts diverging from the actual numbers, it’s time to analyze and determine the cause.

4) Attain Buy-In

Sales forecasting should be a collaborative effort. Like anything else, if people aren’t involved in the development of the forecast, they won’t have faith in the numbers. They may “tweak” the forecast to fit their own agenda, or simply not believe it. Changes they make may result in a skewed forecast, or, if you don’t take care to include all the functional areas, you may wind up with skewed numbers.

5) Keep It Simple and Consistent

The forecast doesn’t have to be uber-complicated. Very often, the person managing the forecast is someone for whom it is a small part of his/her overarching responsibilities. Choose the right software, and it will be nimble and responsive, allowing for adjustment of dependent variables, sales team modifications or alignment of data with CRM. Once you’ve got the model designed, stay with it. Be consistent from month-to-month or year-to-year. This will make it easier to understand, review and audit.

Summary

Sales forecasting is critical to the planning process and maximizing business efficiencies. Accurate forecasts result in accurate inventory, staffing, operations and cash flow management, among others. The most successful companies consistently strive to achieve a more accurate forecast. An inaccurate forecast leaves the company operating in the dark. An accurate forecast can become a major tool in achieving a business’s goals and growing a more successful company.

Tuesday, July 15, 2014

The 6 Marketing Metrics Your CEO Wants to See

The Marketer of Yesteryear

Metrics – the bane of the marketing person: “What do you mean you want to know the CAC? I’m not sure what the ROI on this program will be.” Gone are the days when you just assume your programs will be approved because the decision-makers know, in some vague way, marketing adds to the value of the company or promotion. Gone are the days when the most important thing you speak to your CEO about is the color of the logo or the storyboards behind the commercials.

Marketing's Accountability

Today, decision-makers expect hard numbers on how how you are expecting your program to perform or how it is performing. Marketers are expected to be able to project how many leads will be generated or gross adds acquired. Today, a business-case mentality and the metrics to support it are required to acquire sponsorship and funding for new, or existing, programs. This is the best way to ensure marketing remains accountable to the Business and in line with the business objectives. There are a variety of marketing metrics out there and which ones you choose to analyze will determine the size of your budget, the stability of your promotion and the influence the marketing team will have on the Business’s strategy.

So…what are the most important marketing metrics? Of course, there is always ROI/or ROMI – return on investment/ marketing return on investment. But what else is important? I recently ran across a cheat sheet by Mike Volpe, Hubspot's CMO, which I think lasers in on the most critical metrics.

Summary

It's just a matter of time before marketing departments have data dashboards just like EPMO, sales, finance or other metric-oriented departments, if they don't already. And it will be only a few years before they're producing real-time and predictive data which will allow for faster and more accurate decisions, with resulting performance improvement. Marketing is joining the adults, kids. The time for accountability has arrived.

Friday, June 13, 2014

The Product Innovation Charter - Your Stairway to Heaven

Ok…the Product Innovation Charter (PIC) may not be the stairway to heaven, but it definitely leads to success. How can you know where you’re going if you don’t have a map to get there? That’s what the PIC is all about. According to a 2007 PDMA study, 29% of the firms interviewed had a formal PIC and 75% of the firms had some type of new product policy. This directly impacts the success of developing a new product. Let me throw two numbers at you: 50% and 21%. On average, 50% of new products in companies that have a defined new product development process will succeed, while only 21% of those without a defined process will succeed.

Needless to say, using a PIC to guide the development of new product strategy is a worthwhile investment. You may ask, “What does that have to do with me, a marketing professional? It’s simple – at some point, you may be asked to work on a product development or launch team. It’s critical to understand the purpose of the product and the associated marketing elements as well as how they all fit into the business’s strategy. This document will assist you in assessing, among other things, objectives, markets, and goals as well as developing pertinent product-specific success metrics and marketing strategy.

So what is a Product Innovation Charter? A typical PIC is a written document developed by senior management to chart the company’s new product strategy and guide the product team. It usually consists of four sections: background, arena, goals and objectives and special guidelines.

Background

  • Validate the strategy and purpose of the project as it is aligned with the strategy.
  • Elevator speech that answers “Why are we doing this project?”
  • Guides the link of the project with the corporate strategy and goals of the business unit.
  • Clarifies the role of the team in developing project/service.
  • The logic of why the project is being pursued is outlined.

Arena

  • Addresses “Where the game is played” and the technology.
  • Defines at least one clear technology dimension.
    • Core competencies
    • Existing technologies
  • Defines at least one clear market dimension.
    • Customer segment
    • Customer benefit
    • Distribution channel
  • Defines competencies and competition.

Goals and Objectives


These should be operational, tactical and measurable.
  • Long and short term
  • Accomplishments
  • Metrics
    • Profit
    • Growth
    • Market share

Special Guidelines

  • Rules of the road
  • Management requirements
  • Legal/regulatory requirements
Don't skip the PIC! Make sure there's one in place and that you understand it. Your chances of succeeding with your next new product development project will increase substantially.

Thursday, May 22, 2014

The NPD Process - It's a Stage-Gate Thing

“The best performing companies’ new product development (NPD) revenues range from 20%-50% of total revenues and more for profit.” – NP Learning, LLC

Do I have your attention?

First a quick explanation of “stage-gate process”. The stages are the periods during which the actual work takes place and should include specific milestones. The gates occur between the stages and are the decision-making points. Common gate criteria include:

  • Strategy fit
  • Defined market need
  • Market attractiveness
  • Project feasibility
  • Product advantage
  • HES considerations
  • Risk-Reward analysis
  • Determination of any show stoppers or "killer" variables
  • Ability to leverage resources
  • Appropriateness of action plan

Generic Gating Process. Illustration provided by Global NP Solutions.

The best firms are significantly more likely to use a structured new development process and innovation strategy to guide their new product development than the rest. What does that mean? It means that you are more likely to be productive and successful if you include the following six steps in your new product development and more likely to fail if you don’t. PDMA’s 2003 best practices study showed that 69% of the “best” firms report using a formal, cross-functional process for NPD. They were also seeing a significant decrease in time to market, especially for New-to-the World products, which went from 3.5 years to 2.

Stage 1: Opportunity Identification

This is when you identify potential markets, technologies and products that fit the organization’s strategy. The organization links the market and business strategic plans with the potential new product.
Key ActivitiesKey Deliverables
  • Strategy fit
  • Market attractiveness
  • Technical feasibility
  • "Killer" variables
  • Product Innovation Charter
  • Market opportunity assessment map
  • Product roadmap

Stage 2: Concept Generation

Activities focus on generating product ideas or concept that will meet the market needs found in Stage 1. No idea or concept is too outlandish at this stage.
Key ActivitiesKey Deliverables
  • Problem-based ideation (brainstorming)
  • Pursuing inside sources
  • Pursuing outside sources
  • Preliminary technical assessment
  • Preliminary market assessment
  • Product concept statement
  • Preliminary business case

Stage 3: Concept Evaluation

At this point, you should be evaluating the concepts generated in stage 2 and select the most attractive of them for further development.
Key ActivitiesKey Deliverables
  • Market requirements
  • Concept testing
  • Define product attributes
  • Sales forecasting and financial analysis
  • Capital requirements
  • Quality function deployment
  • Product protocol
  • Business case
  • Project and resource plan

Stage 4: Development

Development of the new product is finalized and the product is manufactured. This should involve multiple personnel across several divisions. This stage may require investment for new facilities to produce the new product. Stage 4 is normally lengthier and more costly than the other stages.
Key ActivitiesKey Deliverables
  • Develop prototypes
  • Product use testing
  • Strategic launch planning
  • Production planning
  • Regulatory/legal issues
  • Design for excellence (DFX)
  • Proven product prototype
  • Updated business case with a high degree of accuracy (within 5%-10%

Stage 5: Launch

This is, for many, the most exciting stage of the process since the new product is being commercialized. This stage involves everything necessary to launch the new product. Key activities are oriented around the launch and ensuring appropriate inventory exists for the new product as it goes into full sale.
Key ActivitiesKey Deliverables
  • Implement the strategic launch plan
  • Launch management
  • Implement operations and ramp up to full-scale production
  • Transfer the product to mainstream
  • Commercialization
  • New product introduction

Stage 6: Life Cycle Management

This stage involves monitoring the product for success in the marketplace and making any necessary adjustments to it in the event it is not performing as expected. This stage is the one most likely to be skipped in the NPD process.
Key ActivitiesKey Deliverables
  • Monitor the new product
  • Make refinements
  • Augment the product to create a new product line if needed
  • Exit strategy
  • Real-time metrics

Summary

Following a structured NPD process can improve time-to-market, decrease costs by allowing for the killing off of unfeasible products earlier on in the process, improve IRR and ROI and improve communication across all functional areas resulting in superior products that better meet customer needs. In the end, the question isn’t “Why use an NPD Process?” but rather “Why not use an NPD process?”