To the Swiftest Go the Spoils

WHEN YOU SEE WORDS like “estimate” and “90 percent” flung about without supporting data, it’s wise to assume you’re dealing with a guess landing somewhere between wild and educated.

But when no less than IBM does the flinging, I’m inclined to pay attention.

IBM recently suggested that 90 percent of all data has been produced within the last two years. Whether the statement is informed or speculative, and regardless of what they include (or don’t) in “all data,” the point is well taken. We are compiling data at breakneck speed. There is no reason to believe the trend will slow, and there is every reason to believe it will accelerate.

“Accelerate” is the operative word. Marketers aren’t just upping the speed and volume of data accrual. Sophisticated tools analyze on the fly, cutting response time to seconds. The goal? To show up on mobile devices in hopes of influencing customers in the very moment they are thinking about buying.

In an article by John Adams, Ross Christi, manager of LoyaltyEdge at American Express, has this to say: “The volume of data isn’t necessarily the challenge. It’s about using it intelligently and managing it in an efficient way.”

Keeping and analyzing customer data isn’t new. Savvy marketers have done it since the early days of direct mail, the original interactive medium. They didn’t call it data back then, but a rose is a rose. Data at the time pretty much consisted of name, address, purchase type, frequency, and average spend. In today’s interactive and mobile world, data comprise much more. And while at first it seemed as though privacy fears and laws would curtail data gathering, something interesting happened, and fast: consumers began volunteering the very data that fear-mongers had earlier convinced them marketers should not be allowed to obtain on their own. Mobile device users willingly reveal the merchants and products they like, where they’re shopping or dining at the moment, what UPCs they’re scanning, and more. Add up enough of those voluntary data points (and, for existing customers, overlay them with established buying preferences), and a picture emerges of who is where and thinking about buying what. Respond to the picture fast enough with a compelling offer sent to a mobile device, and you increase the odds of winning customers while they’re still at the point of purchase and, hopefully, still in a buying frame of mind.

Fear-mongers are still at work doing their best to decry fast-responding marketers as manipulative or sneaky. Nonsense. Sound marketing is a win-win. Marketers win by creating or growing customers. Customers win by receiving usefully timed information and offers on products they actually care about. And, of course, no data is shared without express permission from the customer.

John Knuff, general manager of global financial services for Equinix, said (as quoted by Adams), “What we are seeing now with intelligent targeting is more data mining is going on and happening within the customer session—so if a consumer is getting instructions on what to do to access or redeem an offer, a lot of the information to drive that has to be transferred in real time.” Knuff adds a caution: “… if the data set is on the West coast, but the session is on the East coast, the data has to traverse three to five vendors and has to travel three thousand miles several different times during that session. That’s really going to bog things down.”

Time has always been money. But in the marketing arms race, shaving—by even an insanely infinitesimal amount—the time it takes to turn data into a well-executed marketing response will give the marketer a serious advantage over competitors.

Zappos: Rhetoric and Reality

Lest I be misunderstood, let me state for the record that I love Zappos. I admire, perhaps even envy them. And I like shoes as much as the next guy.

When companies attain preeminence, it is usually due to a convergence of factors. Surely Zappos is no exception. Being early to the game helped; with a strong, consistently fashionable offering, they established a relevant brand for upscale shoppers. Their adeptness at removing barriers to purchase and delivering legendary customer service play a big role. So do wide selections, good web design, easy navigation, solid back-end management, a generous return policy, reader-friendly copy, favorable word of mouth, sound capitalization, old-fashioned elbow grease and more. And not to be overlooked, though no one cares to admit their part in any success, are the twins of fortuity generally known as Luck and Timing.

It makes for an arguably fine recipe for any aspiring internet startup. The trouble is, once a company becomes a runaway success and reporters start showing up to ask how they did it, the above description seems so … so … banal. What reporters want to write, readers want to read, and, conveniently, business leaders want to dish up is self-congratulatory rhetoric dressed up as revolutionary thinking. Ironically, the result tends to be equally banal, often a mere recycling of In Search of Excellence-style flatulence. Yet in some sort of bizarre social contract, interviewer, interviewee and reader agree to treat the flatulence as new and instructive.

So it is that companies like Zappos come to believe, and would have us believe, too, that it was their strict adherence to cool-sounding values that rocketed them to success, and that your own strict adherence to like values will inevitably rocket you there, too.

At first glance, the values Zappos parades on its website and that reporters eagerly gush about appear compelling. Who can argue with lofty ideals like Deliver WOW Through Service, Embrace and Drive Change, Create Fun and A Little Weirdness, Be Adventurous, Pursue Growth and Learning, Build Open and Honest Relationships With Communication, Build a Positive Team and Family Spirit, Do More With Less, Be Passionate and Determined, and Be Humble?

But let’s step back from the excitement for a moment. Exactly how does one implement and measure WOW? How about passion and weirdness? (For that matter, how do you reconcile an admonition to be humble with the blatant braggadocio of running self-aggrandizing, Are-We-Cool-or-What standards all over your website?) These are not standards. Standards are measurable. These are slogans designed to promote, not to explain.

Of course, their very magic and elusiveness explain why many managers eagerly embrace them. No one can prove that you do not adhere to what cannot be measured. Nor can anyone disprove their effectiveness. If a company succeeds, credit the “standards.” If it fails, claim that the “standards” would have worked if only the company had truly committed to them.

Zappos and other successful interactive companies deserve praise and admiration for their success. But it’s important not to discard the nitty-gritty for sexy sounding platitudes.

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Five Lessons from the Instagram Fiasco

You know the tale: Facebook acquired Instagram; members inferred from the revised agreement that advertisers could use their photos without paying or obtaining permission; Facebook replied, in essence, “No, no, no, you misunderstand, we would never do that”; Facebook changed (“clarified”) the user agreement; Instagram subscribers left en masse; and pretty much no one blamed them.

A modicum of common sense PR-wise should be required for anyone working in any area of marketing communications. This should be especially true in interactive marketing, given its pervasiveness. But apparently someone at Facebook was running a modicum or two low at the time.

I offer the following lessons from the Instagram fiasco:

Lesson 1: When you acquire a company with high customer involvement, hold off on making changes for awhile. Customers don’t experience much angst when you acquire a coin-op laundry. When you acquire a company like Instagram, which people love as-is, and you’re Facebook, which has a reputation for pushing through unpopular changes, customers might just need time to develop a little trust that you won’t rush in and spoil their fun.

Lesson 2: Don’t expect people to believe the unbelievable. For all I know, Facebook really didn’t intend to let advertisers use member photos. Trouble is, the masses didn’t seem to buy the denial. Facebook would have done better simply to say, “We hear you, we’re sorry, we made the change you asked us to make, and we learned our lesson.” (More on showing “lesson learned” in a moment.) Recall that when the Coca-Cola Company unleashed fury upon replacing Coke with New Coke, they didn’t waste time whining about being misjudged. They apologized and brought back the original—with lightning speed. Only later, to the suggestion that they had masterminded the whole thing from the start, did they reply, “We are not that dumb, and we are not that smart.

Lesson 3: Imagine possible consequences before you act. On the other hand, suppose Facebook truly had intended to let advertisers use member photos. Not much genius would have been required to anticipate objections, re-think the decision and avoid a mass member bailout.

Lesson 4: Find a smarter way to the same end. Throngs routinely and willingly plaster their mugs all over the web. If Facebook really, really wanted to allow use of member photos in ads, chances are all they had to do was offer an opt-in with a modest spiff or payment in return. Participation could well have become the “in” thing to do.

Lesson 5: Show by your actions that you have learned your lesson. As mentioned above, Facebook has a history of making unpopular changes, user protests notwithstanding. In the wake of the Instagram fiasco, it’s not surprising that Facebook’s good faith claims are being met with skepticism.

Mind Your Back End

“Brand” has lots of definitions. Conveniently and not surprisingly, there is a strong correlation between how a marketer defines “brand” and the kind of branding that that particular marketer happens to execute. I shall leave it to you decide if marketers hold to an approach because they believe in it, ferociously defend an approach because it’s the one they’ve been using, or a little of both.

But one important aspect of branding that most gurus tend to agree on is that a solid brand delivers a consistent, end-to-end customer experience. “End-to-end” is key. It means that at any point during a transaction a customer should be witnessing the brand’s standards in action.

Marketers usually focus on the front end. They use the traditional and interactive media to bring in new customers, bring back established ones, and make CEOs, board members and their respective spouses feel cozy about how their company looks.

The problem is that the back end — what happens to customers from the moment they show up in-person or online — usually falls under someone else’s control.

And not just one someone. In most companies, different lords rule over hiring and firing, store layout and maintenance, sign installation and maintenance, policy for handling returns and complaints, janitorial standards, inventory, phone etiquette, correspondence, order fulfillment, commission structures, discrimination and harassment policies, and more. Even worse, all too often such areas are controlled independently on a local, per-franchise or even per-store basis.

All of which can make delivering a consistent brand experience something of a challenge.

No wonder many an ad promises what a product or company in fact fails to deliver. If you have ever laughed aloud upon seeing a brand advertise “our courteous, trained professionals” and “our attractive, state-of-the-art facility” after one of their employees treated you like dirt or you found yourself wishing you’d remembered to wear your biohazard suit to their store, you know what I mean.

There are companies that pull off the end-to-end thing with aplomb. The brand everyone likes to celebrate for that — deservedly so — is Nordstrom. Their unfailing delivery of the brand promise built that reputation for them. Another celebrant is Apple, whose packaging is pure showmanship, and whose products emerge from a box ready to go. Both are per brand promise. Lesser known but amazing in their handling of the back end is Levenger. Products arrive assembled, expertly packaged, and backed by an insanely generous, no-weasel satisfaction guarantee. (Three years after purchasing a $300 attaché, a colleague inquired about replacing the shoulder strap which had a broken buckle. Replying that the strap wasn’t available separately, Levenger offered to replace the attaché or send a refund, sight unseen.)

Great ads and easy-to-navigate websites are important. But if they serve only as gateways to a disappointing experience, the result is a back-end fail.

Which, no matter whose area of responsibility it falls under, is ultimately a marketing fail.

If you’re a marketing director who knows about the holes in the back end but lacks the authority to plug them, I’m not sure what advice I can offer short of printing this post and hoping that the CEO doesn’t figure out that you’re the one who left it on her or his chair. But for those who have hole-plugging authority, consider this a friendly reminder to take a second look at the back end.