New DNA of Marketing is about High-Speed, Low Cost, and at Scale
In my quest towards the Digital Excellence diploma along the Digital Transformation learning path from the IMD, I followed the Marketing Strategy in the Digital Age program, a 8-week online and interactive course to learn how the marketing landscape is changing, and what role digital is playing in this shift (spoiler: a lot).
My own objective was also to expand my footprint into non-technical aspects of digital - in that case, building and enlarging my toolbox of marketing techniques, methods, metrics, systems, platforms, etc. and becoming familiar with marketing jargon such as customer experience, inside-out and outside-in marketing, or content marketing, whenever possible with hints about how it translates into B2B situations.
As I did for the previous courses I followed (link to articles at the end of this page), I summarized here my learnings and the key take-aways that I wanted to share - while adding relevant material I stumbled upon since the course.
Key Take-Away: digital marketing is about high-speed, low cost, and at scale
Traditional marketing is not obsolete, but enhanced and accelerated by digital. Core marketing principles remain relevant - do not throw away what you have learned and experienced in the pre-digital era, most of it is still valid!
I had this discussion with a marketing friend of mine a couple of years ago, where she stated that "good old marketing" was still relevant for digital marketing careers. It's true, but be aware that it is not sufficient anymore: what has changed is the way we do marketing (data-driven processes and tools) and how it leads to better "reach, educate, engage, and retain customers".
Somehow, this is what digital does to every industry and to every function: it transforms them, yes, but at core it remains what it was. Netflix still is a media company, Spotify a music one, Tesla still part of the automotive industry. And digital marketing is still marketing.
These new players are not belonging to the "tech" or "software" industries. There is an excellent article by Benedict Evans earlier this year which describes this situation very accurately: Outgrowing Software | Ben Evans
Digital is transforming marketing as the following shifts happen, enabled by digital & data, across all industries:
We often talk for this effect of Marketing on steroids: high quality content is developed and aggressively promoted through as many channels as feasible, resulting in tons of traffic and exposure.
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Learnings: Traditional Marketing Topics
I didn't learn only new, digital-based marketing techniques. For a non-marketer like me, it was still valuable to catch up with 1-0-1 marketing concepts.
Customer Value
The value of a product or a service is always perceived by the customer! And the customer compares your offering to the Next Best Alternatives (NBA) at his disposal - which can be beyond simple competitors - so the value is always relative.
For example, we had the now classic Uber case to study and to consider what are the NBAs to Uber (yep, the disruptor has become the disruptee!). Similar transportation-based solutions were obviously mentioned (car pooling, taxis, public transportation, bike rental, etc.) but I loved the bold answer from one participant: Zoom! Indeed, a lot of use cases that make you order a Uber can probably be replaced by a virtual meeting, a home delivery, etc. I wonder if we would have noticed it without Covid...
Very often, the standard definition of the value of an offering does not factor in the ease of switching from an existing product or service to a new one, or the emotional elements that are part of the decision-making process. That is why the formula to define the Customer Value must be added the notion of risk, as per below.
Risks tend to be overestimated, benefits underestimated. But in the end, you have to offer not only something better and cheaper to a NBA, but also safer - "Brands are nothing else than risk mitigators!"
Remember the Uber case: yes, it's easier to use, often a lot cheaper - but safety issues following cases of abusive drivers rose a lot of criticism for their business model and put the company under a very bad light.
How to solve the 3rd part of the equation? You must know your customers better. And for this, you have to add intelligence to your product, in order to (partially) transform physical products into information products. Generated data will fight commoditization, foster deeper relationships with customers, and create dependency and intimacy.
For example, you can add sensors to your product (IoT approach), connect with others (platform / community approach), or develop a complementary digital product (mobile app).
In business-to-business (B2B) situations, the initial difficulty lies in the complexity of the products - often a combination of products, features, services, and jungle of pricing models, called in many cases a "solution".
Yet, business decision-makers must have a thorough understanding of processes to assess how much added value one solution can generate compared with next-best alternatives. This is why many B2B companies tend to move away from commodity services and climb the layers of complexity, rendering the Customer Value unique.
Customer Segmentation
There are a lot of ways to segment a market, for example by demographics (income, age, gender), by behaviors/situation (usage behavior, usage occasion, purchase influences) or by needs/benefits (functional benefits, emotional benefits, self-expressive needs).
Interesting note: the last approach is becoming more and more critical.
In order to come up with a suitable market segmentation, a company can follow two different approaches:
A good segmentation approach should combine both: with Why, you develop the right product and the right message, and with Who, you reach your customers easily.
The reasons why we need segmentation and targeting are to better serve the needs of customers, to increase customer loyalty, to become more efficient, and to improve ROI.
"Changing the channels changes what's bought - smaller brands have dramatically larger share online" Ben Evans, 3 Steps to the Future, Dec'21
In B2B markets, Verticals (industries) and Size (revenues, employees...) are not the only possible segmentation: the targeted market can be divided into Solutions seekers (innovative, proven, cost effective solutions) and Price seekers for example.
Let's consider the telecom industry: in the 5G era, telecoms operators will need to focus on how their business customers plan to use their services, instead of looking primarily on customer size and targeted volumes. When it comes to new capabilities in Cloud, IoT and security, operators will increasingly seek growth in professional and IT services rather than connectivity.
Account managers will be business-problem solvers rather than order-takers for connectivity solutions. And digital will play a more critical role, from the customer experience (e.g. self-service) up to future product development (based on the collected data).
Customer Engagement, Loyalty, and Advocacy
The key is to bring a standard user (Engagement) to a loyal buyer (Loyalty) and to become a brand devotee (Advocacy).
To my surprise, this has a lot to do Management of Change: I never made the connection, but the barriers to customer loyalty and advocacy are exactly the ones I encounter in supporting customers in their journey to adopt a new way of working, a new organization, or a new technology.
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"To get people to change, the advantages have to be at least twice as good as the disadvantages" Goutam Challagalla, Strategy & Marketing Professor at IMD
Indeed, most technological products fail because they miss the transition from an early market dominated by Innovators & Early Adopters to the Early Majority. There is a big gap between Early Adopters and the Early Majority in the Technology Adoption Curve - only when a brand crosses this "chasm" (gap), they become successful. And, it is not easy to cross that gap.
The Adoption Curve above is adapted from the article Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers | readingraphics.com.
Therefore, because the world of marketing is today driven by technology, disruptive competition, and increasing expectations from customers, "the fundamental goal for any transformation in a marketing context is to optimize the customer experience" (Ten steps to successful digital transformation in a marketing organisation | WARC). A company has to think about everything from a customer's perspective, in order to transform from a sales-driven to a user-driven company, and "cross the chasm".
Similarly in B2B, marketing has to transform: usually, B2B marketing budget is dedicated to the top and the middle of the pipeline - but focusing on customer relationships after purchase and turning buyers into advocates becomes probably more and more important.
That need for human touch applies to understanding customer pain points and giving the brand a more tangible presence. An emphasis on solving business problems, rather than the technical elements of products and services, can help B2B companies engage their customers and stay relevant post-purchase.
For example, a major opportunity could be in educating users to get more out of the products, driving upgrades, renewals, or additional product and service purchases. I noticed this trend in the IT service industry already. with SaaS offers, you rarely used the full feature set of your licensed software, which you already paid for.
Learnings: Digital Marketing Topics
Customer Centricity: Inbound & Outside-in Marketing
Outbound marketing, or traditional marketing, is a push strategy, used to sell products with a one-way communication. It pushes messages at everyone, disrupting whatever content is being consumed (e.g. TV ads, pop-ups and banners, telemarketing).
Inbound marketing is a business methodology that attracts customers by creating valuable content and experiences tailored to them, solving their needs, while providing 2-way interactions between companies and their (potential) consumers.
Combining Inbound marketing with data is today's marketing Holy Grail: customers make decisions thanks to word of mouth, brand and price, and because word of mouth is now coming at scale thanks to digital, this completely changes the game.
"When customers change how they buy, they change what they buy" Goutam Challagalla, Strategy & Marketing Professor at IMD
The inside-out mentality is relevant to YOU: you get excited about all the cool features your product can do - but you tend to miss the real job-to-be-done that the customer wishes to accomplish. Customer satisfaction neither comes from the product nor from what the it does.
That's where Outside-in thinking comes in: the focus is made on the benefits or value the customer is getting from the product or service you deliver, sensing what they want (or the market proposes) and responding to it.
(True) Customer centricity is about falling in love with your customers' problems. If you're unsure about what it means, the illustration on the right demonstrates it well.
It has to be less about you, more about the customer. And that's important, because customers are now in control: they can choose which channels they use in their journey, they can choose which time is best for them, they can search for the specific information they need, etc.
Inbound marketing techniques (attracting customers) and Outside-in thinking (customer-centric) work hand-in-hand with Content Marketing (content creation).
Content Marketing
Content Marketing is a pretty recent marketing term. It deals with creating, curating, and crowdsourcing engaging and relevant material & information, and distributing it in way that reach your target audiences, with the goal to increase customer engagement and build customer loyalty.
90% companies claim they have content marketing - but 30% believe they are good at... The funny thing is that 95% of content is used by only 10% of the people. Content Marketing is particularly important in B2B, as buyers make thorough inquiries earlier on: 70% of sales happen even before sales people are engaged.
The role of content marketing is to help the brand tell better stories, think beyond the product/service, and engage with customers during different phases of customer journey with differentiated content/communication.
In B2B setups, it used to be a very linear, sequential process: a hand-off model from Marketing to Sales. With digital, more collaboration is expected, for example feedback from Sales on pitches or from customers on product demos, improved customer education on the services, etc.
Additionally, new metrics must be introduced, leading ones (e.g. engagement and re-engagement, quality of lead qualification, etc.) instead of lagging metrics (e.g. revenues), depicting the overall Sales cycle.
Some Best Practices for relevant content marketing:
Data & AI?& ML (in the context of marketing and beyond)
It has been repeated many times, but I still think this is the main take-away of AI: it is important to understand that AI does "a single thing, but in a super-human way" (faster, bigger…).
Where it is particularly interesting to use, is for the detection of patterns, that most humans would miss. Recommendation systems are based on this. Actually, anything that predicts what may happen is based on AI analysis. However, to be able to use AI, you need data – a lot of them.
Secondly, if "classical AI" is very good for expert systems, it is based on fixed rules and does not evolve, therefore it does not work for everything. To overcome complexity, Machine Learning approaches (or neural networks) are required. And you can use it to simulate and optimize your marketing strategies.
Marketing technologies, such as marketing automation, are now part of every modern campaign. However, it is important to keep a balanced approach and not get seduced by data. One can easily get blinded by flagship projects and prioritize them at all levels, especially because they tend not to scale and cannot be used for other customers. Developing and nurturing a basic portfolio of services shall not be forgotten.
Conclusion
I am not in charge of marketing activities, but as an observer, I now better understand what's being done in that area (it sounded uncoordinated, but it obviously wasn't ??).
And that's where it can help me: I am in direct contact with customers and decision-makers at different points of their journeys with us, an IT service provider. So it will serve me a lot to better integrate (content) marketing into my toolbox, and to engage more often with my marketing colleagues, in order to be able to provide the right content at the right time.
As I learned during these weeks, collaboration with Marketing is what is changing in the digital world: it is not a phased approach, it is permanent exchanges and feedback loops with all the new data that is extracted or made available, and that requires permanent evaluation.
Other articles related to my IMD Digital Transformation learning journey:
Thank you Jérome for your insightful article. In particular, the section on content marketing seems relevant to many of us: Ylenia Vazquez Fernandez Stefanie Zürcher Markus Zurbrügg
Align what you do with who you are - Leadership - Entrepreneurship - Strategy - [email protected]
2 年Bertrand Blancheton ??