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September 27, 2012

4 Important Advantages of Data-Driven Marketing for Your Organization

Big Data. It’s the marketing buzzword of 2012. You’ve probably seen countless articles about “The Rise of Big Data”; or heard the rallying cry “You need to be equipped to handle big data!” For many organizations and executives, the term Big Data seems intimidating. It conjures thoughts of endless strings of numbers and complex equations. But while the process of collecting and analyzing data may be complex, understanding the power of data doesn’t have to be. Let’s push aside all the Big Data hype and focus on what’s really important: How data will benefit your business.

2.7 Zetabytes of data exist in the digital universe today.*

First Things First – What Exactly Is “Big Data”?

If you’re having trouble finding a solid definition of “Big Data”, it’s because their isn’t one. Like all business buzzwords, Big Data has been tossed around like a dog toy. In the process, it’s accumulated different meanings. NYTimes.com recently published an article (“How Big Data Became So Big”) exploring the origin, usage and meaning of the term. The piece reveals Big Data can mean “applying the tools of artificial intelligence, like machine learning, to vast new troves of data” or it can be used more symbolically. Rod A. Smith, an I.B.M. vice president for emerging Internet technologies says: “Big Data is really about new uses and new insights, not so much the data itself.”

14.9% of marketers polled in Crain’s BtoB Magazine are still wondering “What is Big Data?”*

So where does that leave us? Nowhere really. But the term itself isn’t really important. People love buzzwords, but they don’t ultimately mean that much. What does mean something is what data can do for you. At eleventy, we believe data should be a driving force in every organization’s marketing. Why? Because the numbers tell the truth. They make your business – whether it’s selling to customers or reaching out to donors – that much easier. Data creates a path for your marketing to follow. That’s why it is an invaluable tool every organization should be using.

Four Ways Data Can Drive Your Marketing

Enough semantics, let’s get down to the meat and potatoes. How can data help make your organization’s marketing better, stronger and more effective? Here are four ways:

1. Reach the RIGHT PEOPLE

In a world of 100% ideal marketing, every person you reach with your message would purchase your product or donate to your organization. While that kind of marketing perfection may be near impossible, data can bring you closer. You can use data to whittle your audience down to the people most likely to respond. You can look at the data makeup of your existing customers and pinpoint common traits – income, age, gender, location, occupation, hobbies, purchases, etc. Then you can use that information to target people with similar characteristics (based on collected data). This can improve response rate, increase efficiency and boost your marketing return on investment.

Data production will be 44 times greater in 2020 than it was in 2009.*

2. Reach customers at the RIGHT TIME

Data not only tells you who will be most likely to respond, it can also be used to tell you when they will be most likely to respond. By collecting and monitoring data on how people interact with your organization, you can begin to extrapolate patterns. You can use data to reach customers and donors more effectively and efficiently. For example: if your calling data indicates a customer rarely answers the phone in the morning or afternoon but frequently answers in the evening, you can target your calls only during the evening hours. This way you save the time, effort and cost of making calls at a time the customer is unlikely to answer.

Facebook stores, accesses, and analyzes 30+ Petabytes of user-generated data.*

3. Reach individuals with the RIGHT OFFER

One of the biggest benefits of data for consumers and companies alike is that it can be used to create more personalized experiences. Based on what people purchase or causes they support (as mapped out in the data), organizations can customize offers and opportunities to the individual. If you know an individual has bought certain electronics recently, you can recommend accessories for those products. If an individual has donated to various nonprofits in the past, you can show how your organization is doing related work. If an individual has children of a certain age, you can suggest products other parents of children that age have bought. The possibilities are endless. But it all points to tailoring the marketing experience to the individual.

29% of companies report that their marketing departments have “too little or no customer/consumer data”.*

4. Reach people through the RIGHT CHANNELS

Another incredibly valuable insight data can tell us is how people prefer to respond. With so many communication channels available, people connect in different ways. Using data, we can get a better sense of how individuals prefer to communicate. For example: We can learn that Joe prefers to use email for customer service requests, likes to gets deals and offers through social media, and responds to phone calls from nonprofits. On the other hand: Jane does all her customer service communication via phone, wants deals and offers in her inbox, and most frequently responds to donation requests through direct mail. Organizations can use that data to reach individuals in the most effective way possible. As a result, people will be more apt to respond positively.

The volume of business data worldwide, across all companies, doubles every 1.2 years.*

In this new age of customized marketing, data is an amazingly powerful tool. Data gives organizations the ability to speak to personal preferences and tailor marketing to the individual. When implemented properly, data creates a map for organizations – showing you how to reach the right people at the right time with the right offer through the right channel. Don’t be put off or intimidated by the term Big Data. Today, using data to better segment your audience and create more focused messaging doesn’t have to be daunting. Technology is making it easier every day. The truly “big” aspect of data is the benefits your organization will see as the result of more refined marketing.

*Big Data statistics from WikiBon’s “A Comprehensive List of Big Data Statistics”

Source

September 12, 2012

Social Media breaks barriers in SA

Social networking in South Africa has crossed the age barrier, the urban/rural divide and even the relationship gap, according to research findings announced today.

The South African Social Media Landscape 2012 study, produced by technology market researchers World Wide Worx and information analysts Fuseware, shows that the fastest growing age group among Facebook users in South Africa is the over-60s. From August 2011 to August 2012, the number of over-60s on Facebook grew by 44%, compared to less than 30% for those aged 30-60, less than 20% for those aged 19-30, and less than 10% for teenagers.

“This is a reflection of Facebook going mainstream in South Africa,” says World Wide Worx managing director Arthur Goldstuck. “The younger segments are still far from saturation, but we’re not seeing the same heady pace of growth among the youth as before.”

At the end of August, 5.33-million South Africans were using Facebook on the Web, 2,43-million were on Twitter and 9,35-million on Mxit. Because Facebook does not measure mobile-only usage among those who have registered via their cellphones, however, the full extent of its penetration is significantly understated: primary research by World Wide Worx shows that 6.8-million people access Facebook on their phones.

Twitter use measured in this primary research indicates that its user base had grown to 2,2-million by the end of June, or 100 000 new users a month since August last year. Fuseware data, collected directly from Twitter through an API (application programme interface), shows that the number reached 2,4-million at the end of August, exactly matching the growth rate measured by World Wide Worx, and validating the earlier data.

“The integrity of data, and its interpretation, is vital for business decision-makers and marketers who are investing in social media,” says Fuseware managing director Mike Wronski. “Different methodologies allow us to gain deeper insights, as well as providing cross-validation for our data.”

Other key findings announced today include:

• Both Facebook and Twitter have grown at a similar rate, at around 100 000 new users a month, for the past year.
• LinkedIn has grown substantially, but at a slightly lower rate, to reach 1,93-million South Africans.
• Pinterest is the fledgling among the major social networks, with only 150 000 users in South Africa.
• *WhatsApp has become the leading instant messaging tool among South Africans aged 16 and over, living in cities and towns, with a user base of 4,6-million.
• The youngest mobile instant messaging tool to emerge on the measurement radar in South Africa, 2Go, has close to a million adult users.
• The most common “Check In” sites for Facebook in South Africa are airports and shopping malls.
• The biggest tweeting day of the week is a Monday, with an average of 9,6-million tweets sent by South Africans on the first working day of the week. Friday is next, with 9.6-million, while Saturday is the slowest Twitter day, with 8,4-million tweets.
• Both Facebook and Twitter have crossed the urban/rural divide. The proportion of urban adults using Facebook is a little less than double rural users – but rural users are now at the level where urban users were 18 months ago. Twitter’s urban penetration is a little more than double its rural penetration, but the rural proportion has also caught up to where the urban proportion was 18 months ago.

One of the most fascinating findings reported today is that the number of single users has grown faster than any other relationship group, by almost 25%, to reach 957 000. The number of married and engaged users has each grown by 16%, while the category of those “in a relationship” has increased by 9%.

“Clearly, Facebook is filling a relationship gap in the lives of many South Africans,” says Goldstuck. “But social networks are also so much more – we see them playing the roles of communication, information and entertainment networks.”

Wronski adds: “Social media fatigue has set in for the more over-active users, who follow too much, communicate too much, and vent too much. But most users are arriving in this world for the first time, and new users are going to keep coming. It’s mainstream today but, tomorrow, it will be pervasive.”

February 26, 2012

The ROI of Social Media

Social media ROI has been the elephant in the room for many years now, as marketers and analysts struggle to address it and calculate it, even though we know how important it is to drive corporate social media investment forward.

Fuseware has developed some great algorithms for detecting how many eyeballs have seen social media conversations related to a brand, topic or event. For example, the recent Deloitte fun run in Pretoria garnered a social media response of close to 20,000 views from the mentions of only 50 people. In social media, even a few influential people can have a tremendous market impact when they speak about the same topic.

The question now is, how does the number of views translate into hard and fast ROI that a marketing director can present to justify the social media investment. I have been asked this question several times by my clients, and would like to give an official response.

The advertising industry has a metric called the “advertising equivalent value”, which calculates an approximate ROI based on the number of views and demographics of a piece of content. Many companies take the easy route and use this metric in social media, but I don’t think it quite fits due to the vast differences in conversations and demographics. Firstly, I don’t think social media ROI can easily be automatically calculated. The value from 20000 people talking about a fun run is different to the value of 20000 people talking about a 20% discount sale by a large retailer. The ROI needs to be determined strictly from the market’s conversion potential, that is the rate at which people who view the content end up converting to what the company may be offering, and the downstream revenue that they eventually may give to the company. For example, 20000 people who convert at 1% for a R100 offer are more valuable than 20000 people who convert at 1% for a R10 offer – so even if the social media impact is the same, the ROI would be different.

The first metric to find is the probability that a person on social media will convert, if they have been exposed to your social media content. This then boils down to a problem of statistics, for which we can use Bayes Theorem to solve.

Let’s define A as a conversion. Essentially, this is the desired action you want your customer to take.
Let’s define B as a social media user, who has been exposed to your brand related content.

P(A|B) is the probability of converting a customer, if they have seen your social media content. The variables we need to solve are as follows:

P(B|A), which is the probability of a social media user having seen your social media content, once they have converted. This can be found by surveying which of your converted customers have done so because of your specific social media efforts. If you have an online store, you can build the metric into your e-commerce system by tracking users through cookies as they click through your social media links onto your site.
P(A), which is the probability of a conversion. This is taken from the company’s existing conversion rate data that exists for its past advertising campaigns, and is independent of social media related conversions. This can also be taken from existing advertising initiatives, such as PPC campaigns.
P(B), which is the probability of a social media user seeing your content on social media, whether or not they have been converted by your current offer. This is the tricky part, one which a company like Fuseware can help you solve. It requires calculating how many users are in the brand’s market in social media, and how many have been exposed to specific brand related content.

An important note to make is that the more accurate you make P(B), the more accurate the final ROI calculation will be. For example, if you are monitoring  your entire brand’s mentions as social media content, you will find that there are a combination of positive and negative mentions, as well as many mentions unrelated to your conversion – many of this will be irrelevant to the ROI calculation of your campaign. This is why one needs to be able to track a campaign using a specific hashtag on Twitter, so the exact exposure of that hashtag can be determined, and the content involved with the hashtag is guaranteed to be campaign-related.

With a probability value calculated, and the number of social media content views determined via analytics, it is now the company’s task to put a value on a single conversion. A conversion could be a product sale, in which the value of a conversion is the revenue from that product, or it could be more intangible, such as getting the person to sign up for a mailing list, which may have a downstream value of R100 per year, on average. In any case, this will need to be defined by the company and its unique conversion targets, for which they should already have the value.

The final ROI then becomes fairly trivial:

The investment gain is calculated from P(A|B), multiplied by the number of views on social media for the specific campaign, multiplied by the value of each conversion. The cost of the investment is calculated from the expenditure on social media by the company, including time billed, agency rates and the cost of producing social media related content such as viral images and media.

Some points to note

  1. Engagement has an indirect effect on ROI and is very important, but the social media exposure metric indirectly absorbs it. More engagement also drives intangible brand loyalty, which has not been considered in our equation.
  2. The quality of content related to calculating P(B) is critical to the calculation. 5000 views of “i love vodacom” will have a vastly different response to 5000 views of “i hate vodacom”, even if both have the same exposure. However, due to the calculation of P(B|A), there is a direct relationship between exposure to this content and converting a customer.
  3. In the end, viral laser-focused brand campaign content is what drives the ROI equation.
  4. This equation calculates ROI from a purely monetary perspective. Intangible things like reputation, PR value, trust building, and market differentiation are not taken into account, which of course should be.

I would love to hear your opinion of this in the comments below. If you would like more information or elaboration, please contact me at mike [at] fuseware [dot] net.

January 4, 2012

Creating Explosive Impact in your Market

This is a post on how to create maximum impact with minimum effort with your products.

In Seth Godin’s Purple Cow, an excellent book about how to make your products remarkable, he outlines how catering to the general masses has become completely ineffective in this day and age. In order to create the largest impact using the least possible resources, a niche needs to be blown away with what you have to offer. Being a big fish in a little pond is much more effective than being an unknown little fish in a big pond. Thus to make the biggest impact possible, the trick is to find the smallest untapped niche that is ready and waiting for you to solve their problems – its that simple. The overall process can be split up as follows:

  1. Find a problem that really affects people that you can provide a solution for
  2. “Niche down” so that you cater to a more specific, targetable demographic with your solution
  3. Connect with your niche
  4. Make an impact in that niche

Note that I did not mention the word “sale” at all! People have grown so accustomed to being sold to that they have developed filters that make them switch off when they feel they are being advertised to. In order to sell to your market, you need to give them value by connecting with them and making an emotional and psychological impact in their minds which will naturally lead them to buying your products! In this post I will be focusing on the fourth point.

Ordinary is boring, and being remarkable is the new black.

The business world’s primary currency has changed from money to attention – the longer you keep the attention of your visitors and customers, the better position you stand to convert them. The web has truly globalized the world economy, to the extent of creating dozens, hundreds or thousands of competitors in every niche imaginable. With so many options for consumers – the goal has become to keep their attention for as long as possible. The best way to do this is to stand out to the point of creating a crater of impact in your target niche. I always think big, and my goals have always been around shaking the foundations of the industry I play in by presenting different viewpoints and different ways of doing things.

Don’t be scared to f*** up!

The (limited) downside of being remarkable is that you take on more risk by going into unknown territory. When I created and managed the South African social media report, nothing of its kind and magnitude had been produced in the country yet, so I had no idea what the market uptake or reaction would be. However, since I did my research on finding a problem, niching down and connecting with my niche, I was fairly confident that my impact strategy would be successful. And I was right – within 24 hours of its release I had appeared on international TV for interviews, as well as several radio stations. Not only was I giving real value to my niche, but my impact strategy had worked. Across the world and all industries, if you offer something worth talking about, you are going to be abundant in attention. Once you have peoples’ attention, sales flow naturally like water from a spring.

Take a look at the top viral videos of 2011, and see what elements they have in common. One cannot say that these videos represent the epitome of excellence, humour or insight. However, they are insanely sticky and shareable simply because people dared to do something different than most, describable in a single sentence, and easily shareable with the world. Take Rebecca Black’s video for example – it was shockingly bad to the point of being laughable, but she has racked up over 30 million views on Youtube. What are 30 million views worth to you and your products, at the risk of possibly being laughed at or ridiculed?

Its about the people you connect with early on

Malcolm Gladwell articulates the concept of impact very well in his book The Tipping Point. He describes how there are essentially three types of people involved in getting a product from being unknown to being a viral sensation:

  1. Connectors, who are the people who “link us up with the world … people with a special gift for bringing the world together.” They are “a handful of people with a truly extraordinary knack for making friends and acquaintances”.
  2. Mavens, who are “information specialists”, or “people we rely upon to connect us with new information.”
  3. Salesmen, who are “persuaders”, charismatic people with powerful negotiation skills.

In order to make that impact crater that you want, you need to connect and nurture relationships with all three types of people.

For connectors, I use Twitter. Search for keywords relating to your niche and products and see the kinds of conversations influential people are having in this space. Use Klout to check how influential some of these people really are, especially in terms of two-way community engagement. You want to find knowledgeable people who connect with others in the same niche and voice their views.

For mavens, find influential blogs relating to your niche and connect with those bloggers. These are your thought leaders that people rely on for concrete information, and are incredibly valuable to enhancing your brand. Of course, it goes without saying that you need to be offering something of value first before connecting with these types, as they typically see straight through marketing gimmicks.

For salesmen, I look for people that have sold similar products in different niches, or a different product for my same niche. I form bonds and relationships with them and see ways in which we can work together for mutual benefit. Finding these people depends on the niche, but a good start is searching for similar products in your niche, and connecting with the creators of those products.

What is your primary emotion evoked in your message?

It is now fairly common knowledge that sales are multiplied when an emotion is evoked at the time of purchase. This is what causes the stickiness in certain products – products that you can’t help but think about, talk about and buy. The reason for this is that the human brain stores and deals with emotions much more vividly than cold hard facts. If you try recall your most lucid memories, they are probably attached to an intense emotion (excitement, fear etc.) Your marketing message and any other material (videos, pictures, testimonials) must be completely congruent to evoking the desired emotion from your audience. Some examples of intense emotions and feelings that suit different niches are greed, fear, excitement, love (lust), pride, surprise and generosity.

Evoking emotions isn’t always easy, but there are a few tricks when it comes to this. Neuro linguistic programming has made great inroads into understanding the human mind and what makes us tick. I won’t go into too much detail in this post, but here are a couple of things I use:

  • Use language enriched with adjectives and metaphors. Metaphors are so rooted in our upbringing that for many people they act as an anchor for relaxation and involvement. Metaphors bypass any conscious blocks or resistance and slip into the unconscious mind. Use them!
  • Anchoring, whereby we can change a person’s state or emotion because they are associated with some stimulus. There are many types of anchors, from verbal phrases to physical touches or sensations, and also certain sights and sounds. Whenever a person is in an intense state where the mind and body are strongly involved together and a specific stimulus is consistently and simultaneously provided at the peak of the state, the stimulus and the state become neurologically linked. Then, anytime the stimulus is provided, the intense state automatically results.

The Impact Checklist

When I gun for maximum impact with a new product, business or venture, I go through the following checklist:

  1. Does it fulfil a satiating desire or solve an immediate problem of the niche market?
  2. Does it cater to a small niche of engaged users?
  3. Have I engaged the leading influencers and thought leaders in the desired niche to spread the word?
  4. Can I put it on auto-pilot, scale it up or otherwise make sure it reaches the maximum possible market without much effort?
  5. Can it be manufactured, put together and released in under 4 weeks? If not, I cut out the fat until this becomes possible – if I fail I like to fail quickly.
  6. Is it so remarkable that, combined with the power of my immediate network, it needs a very small marketing budget to spread the word?
  7. Can the results of the impact be concisely measured, be it in sales, page views or even tweets?

Once I am happy with the above criteria, I put the entire plan into action! The last point is very important because it allows for feedback into what is working. We can correlate spikes in our page views and sales with activities and marketing campaigns, which allow us to hone in on what really works.

A last word

In any given activity, 80% of the results of that activity are normally brought about by 20% of the input. Known as the Pareto principle, this applies in many varied aspects of life – and especially in business. Instead of working like a chop for 20 hours a day which many entrepreneurs seem insanely proud to boast about, I focus on the 20% of my activities that eventually lead to 80% of my sales.The new age marketing funnel has lengthened and distorted, since consumers have grown accustomed to advertising and the standard sales pitches, and yet there are more options to connect with your consumers than ever before. This makes for a fairly tricky problem, which is why we need to always keep in mind:

    1. Keep it as simple as you can reasonably make it, but no simpler
    2. What 80% of your work should be thrown out, automated or outsourced so that you can focus on the 20% that really produces your results
    3. Measure, measure, measure. What can be measured, can be managed, and can be optimized.

If you enjoyed this post, please share it or leave a comment below!

March 30, 2011

Excellent viral video by Skittles

Every now and then, an advert just resonates so well with how people these days want media. They want it fun and fresh, interactive, emotive, and share-worthy. Skittles’ latest viral ad, which already has over 30000 views in just 24 hours, is about to go hugely viral.

This is the way new age marketing should be – big brands take note!

March 19, 2010

How to get 500x Better Lead Conversion with One Email

Its obvious and almost cliched that you should use your own network wherever possible to attract new business.

I’d like to make a point about exactly how powerful your network is. From my personal experience throughout my business and work career, a lead that is generated from your first or second degree network of contacts is about 500 times more powerful than a lead from an unknown source.

Where do I get that number from? Well, from all the times I have contacted, scheduled meetings with, marketing to and corresponded with people in different businesses and industries, I would have to say that I have an almost 50% success rate with people within my network, and about a 0.1% success rate from random leads – thats a 500x difference! Even a single email sent to the right person within your network and network’s network is probably going to be about 500x more powerful and more successful than a random email sent to a person that has never heard of you.

This isn’t just a number I sucked up, its from my real empirical observations of being in business and in constant contact with a very large amount of people. I believe that this world has gotten far too small, and everyone is pushing each other to get a slice of the same pie. Companies and people have, of course, been forced to resort to being much less trusting than they used to be, and are much more likely to correspond and do business with trusted sources – ones within their network.

This actually all ties in with what my company is doing – bringing customers and companies closer together within their social networks.

Use your network whenever possible, gain people’s trust, over-deliver your value offering and you will be successful.

February 23, 2010

If Your Business Markets to Other Businesses, You Have to Check This Out!

This is the Google maps business directory for Cape Town:

cape-town-business-listings-google-maps

If you don’t think you can get the attention of at least a dozen of these businesses, you’re doing something wrong!

January 14, 2010

Holy Cow! How I Got Over 2000 Hits on this Blog in a Few Hours

site_changeSince the beginning of this blog, I have focused on producing quality content for would-be entrepreneurs around the world. I communicate with other bloggers, do my SEO, get inbound links and all that. But nothing prepared me for the reaction to the relatively short post I wrote last night. Within a few hours of posting it, I got several thousand hits on my blog – which is an immense amount for this site.

I was getting 50-100 hits daily, which I consider decent for a blog that is just starting out in a highly contested niche in an African country. But my post on me working 12 hours a day and how I was dealing with it suddenly attracted everyone’s attention. I think I understand the Internet just that much more now, so thank-you everyone who visited! Especially you guys from YCombinator  ;)

traffic_spike

So this got me thinking, what do people really want in a blog? And I came up with a relatively sound algorithm to create very attractive content in blog posts. A picture is worth a thousand words, so here it is (pardon my shoddy PS skills):

How to make quality posts

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