MarketingSherpa Blog

I usually watch “Curb Your Enthusiasm” through the eyes of a fan. But recently I watched the popular HBO show through the eyes of a marketer.

And it struck me — Larry David is an extremely valuable customer. And not just because he has all of that “Seinfeld” money (some $900 million of it, according to Adweek).

Larry is valuable because he actually tells brands what he is thinking. Commonly derided as “complaints” or “rants,” in reality, Larry is offering up valuable customer intelligence.

Complaints are business intelligence

In a recent episode, Larry is staying at a hotel. When asked by the front desk employee if he had any feedback on his stay, he suggests that they shouldn’t tuck the sheets in so tight when making the bed. Who sleeps like that?

But Larry isn’t the normal, quiet customer. He’s a super-suggester. And he goes far beyond replying to a question from an employee asking for feedback. He offers unsolicited advice on topics the hotel doesn’t even think to ask about.

While the hotel brags about cookies made by its pastry chef, Larry isn’t buying it. He says the cookies are from Pepperidge Farm.

And Larry is none too happy about the cookie retrieval system the hotel has set up in its lobby. Larry doesn’t want to use tongs to grab the cookies — he is afraid the cookie will get crushed — and he suggests a wider cookie layout system so guests can pick cookies with their bare hands without touching an adjacent cookie.

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In high school, I never quite found my niche. I wasn’t a jock or preppie, neither freak nor geek. I just had to be me.

In other words, my focus was on my intrinsic value proposition, not what the competition was doing.

Competitive analyses are valuable, don’t get me wrong. They are necessary to ensure you have a unique value proposition. After all, your product isn’t for sale in a vacuum. I’ve worked with a competitive sales office in the past and you can learn a lot from win-loss reports as well.

But don’t go too far with this business intelligence. My point is this …

Don’t let the competition define you

At some point, you have to say, “screw the competition.”

If your focus is on the competition, you’ll just be another Why Bother Brand.

And if your focus is on the competition, it’s in the wrong place. Your focus should be on the customer. That’s the way you create differentiated value.

Here are three examples of focusing on the customers, not the competition, from otherwise commodified industries:

Example #1: Southwest Airlines

Airlines have become a dreadfully commoditized industry. Just look how they move in lockstep. One airline adds baggage fees, and then every other “me too” airline jumps in behind it.

Not Southwest Airlines. I’m sure it has analyzed the competition. I’m sure it is aware of fee revenue.

But that simply doesn’t work for this brand. So Southwest offers “No change fees. No matter what.” And communicated that value proposition cleverly in a recent TV ad about a coach who believed in his basketball team so much, he already booked tickets to the championship game.

The kicker, of course, is that the team doesn’t make it to the championship game and has to change their flight plans. Cue the tagline — “That’s Transfarency. Low Fares. Nothing to Hide.”

Does this mean you’ll fly Southwest every time? Probably not. I know I prefer non-stop flights. And you might have a favorite frequent flyer program.

But I tell you this — next time you’re charged $200 for canceling a flight, you’re going to remember that Southwest commercial. And if you go through negative experiences with your current airline enough, you may choose not to shop only on price but to favor flights from Southwest Airlines.

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Think of all the money you invest in attracting customers before they even get to the call-to-action … buying media or traffic, designing websites and landing pages, crafting just the right offer.

If you can squeeze just a bit higher conversion rate out of your calls-to-action (CTAs), it increases the ROI on the rest of your marketing investment.

And that’s just a few percent. What about more than doubling the conversion of that CTA? Without the need for any IT or development resources?

A recent experiment MECLABS Institute (parent research organization of MarketingSherpa) ran with a Research Partner did just that. Let’s walk through the simple word changes and what you can learn from them as you craft your own calls-to-action and button copy.

Experiment design

This experiment was a landing page test that encouraged people to get a physical copy of a textbook mailed to them. These people are decision makers. They choose a product that will lead to significant product sales from others. By getting the sample in these decision makers’ hands, they are more likely to select this product and, therefore, drive significant sales.

The experiment had a control and two treatments. There were several differences between the control and the treatments including changing the image, headline and call-to-action. Both treatments improved clickthrough rate (CTR), with the second treatment generating a 277% increase in CTR at a 99% level of confidence.

That clickthrough increase carried its way through the funnel to an increase for the final conversion as well — an 82% increase in conversion for Treatment 2 at a 99% level of confidence.

But here’s where it gets more interesting. While the team changed several variables between the control and the treatments, they only changed a single variable between Treatment 1 and Treatment 2 — the call-to-action — to discover the impact of the CTA wording.

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Hobbes: Why are you digging a hole?

Calvin: I’m looking for buried treasure!

Hobbes: What have you found?

Calvin: A few dirty rocks, a weird root, and some disgusting grubs.

Wait for it … Wait for it …

Hobbes: On your first try??

Calvin: There’s treasure everywhere!

I thought of this cartoon by Bill Watterson (which he also used to name a cartoon collection book) while reading the Harvard Business Review article Searching for New Ideas in the Curious Things Your Customers Do by Taddy Hall and Eddie Yoon.

Turning a waste product into a $500 million brand

Hall and Yoon tell the story of Steve Hughes, now the CEO of Sunrise Strategic Partners. He was walking through a Tropicana factory when he noticed some workers on break taking the excess pulp (a waste product in orange juice production) and mixing it into juice they would drink themselves.

Instead of ignoring the workers or just assuming their behavior was odd, Hughes got curious and asked them about it. They explained that it made the juice taste fresh squeezed. This interaction gave Hughes the idea to launch Tropicana Grovestand  “the taste of fresh-squeezed orange juice,” which after four years became a $500 million brand.

That is just one example of turning waste into profit. Throughout history, curious business people have not only used this process to launch complementary brands in their own company like Hall and Yoon’s Tropicana example, they’ve also launched entirely new companies off their company’s waste (Kingsford was created when Henry Ford turned wood scraps from Model T manufacturing into charcoal briquets) and launched new brands off other companies’ waste (I interviewed TerraCycle CEO Tom Szaky back in 2007, and since then, the company has made everything from pencil cases to furniture out of other brands’ waste).

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Marketing has a language all its own. This is our latest in a series of posts aimed at helping new marketers learn that language. What term do you find yourself explaining most often to new hires during onboarding? Let us know.

An A/B split test refers to a test situation in which two randomized groups of users are sent different content at the same time to monitor the performance of specific campaign elements.

A/B split testing is a powerful way to improve marketing and messaging performance because it enables you to make decisions about the best headline, ad copy, landing page design, offer, etc., based on actual customer behavior and not merely a marketer’s opinion.

Let’s break down the process of A/B split testing.

Real People Enter the Test

This is part of the power of A/B split testing as compared to other forms of marketing research such as focus groups or surveys. A/B split testing is conducted with real people in a real-world purchase situation making real decisions, as opposed to a survey or focus group where you’re asking people who (hopefully) represent your customers what they might do in a hypothetical situation, or to remember what they have done in a past situation.

Not only can you inadvertently influence people in ways that change their answer (since the research gathering mechanism does not exactly mimic the real-world situation), but people may simply tell you what they think you want to hear.

Or, many times, customers misjudge how they would act in a situation or misremember how they have acted in the past.

That doesn’t mean you shouldn’t use surveys, focus groups and the like. Use this new information to create a hypothesis about your customers. And then run an A/B split test to learn from real customers if your hypothesis is correct.

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When measuring customer satisfaction after the purchase of your products, it’s all too easy to think of the process in a linear fashion:

• I produce marketing and advertising that sets an expectation for my product
• A customer then buys and uses my product
• I will then ask that customer if they are satisfied with the product

However, while reading Customer Expectations: 7 Types All Exceptional Researchers Must Understand by Scott Smith, Ph.D., as part of my studies in the University of Florida/MECLABS Institute Communicating Value and Web Conversion graduate certificate program, there was a line from Dr. Smith that really stood out to me: “The product purchaser, influencer and user may have each been a different type of individual, each having different expectations.”

Notice he doesn’t just say a different individual, but a different type of individual. The key lesson here is that you should not only segment your marketing but segment your customer satisfaction measurement as well.

And while many B2B marketers will see how this is instantly applicable to them, it likely applies to many B2C and nonprofit marketers as well.

Let’s take a look at each type of customer, with an example for each type of marketer.

                                                                                Photo courtesy Flickr CC Village9991

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As a student in the Communicating Value and Web Conversion graduate certificate program from the University of Florida and MECLABS Institute, I recently read the ebook “Winning the Zero Moment of Truth” by Jim Lecinski.

Even though it is obvious content marketing for Google, it’s still a very good book. It’s six years old at this point, so I’m sure you’ve heard the term Zero Moment of Truth (ZMOT) by now, but there are still many good ideas you can get from the book to improve your content and other digital marketing.

The power of ratings and reviews

As he explains in the book, Lecinski’s ZMOT term is a play off a quote from Procter & Gamble CEO A.G. Lafley (p. 11, Lecinski, 2011):

The best brands consistently win two moments of truth. The first moment occurs at the store shelf, when a consumer decides whether to buy one brand or another. The second occurs at home, when she uses the brand — and is delighted, or isn’t.

That got me thinking of creating my own play off of ZMOT that ties into Lafley’s Second Moment of Truth.

In much of the book, Lecinski explains how important ratings and reviews are for a range of products thanks to how friction-free getting this information is on the internet versus the pre-internet days. No longer are people only reading the print edition of Consumer Reports to get reviews on cars and washing machines, now they search reviews on everything.

“When I go to a presentation at, say, a Hilton Hotel, I tell the audience this: ‘There are more reviews online for the Bounce Dryer Bar than there are for the hotel we’re sitting in right now.’” he says (p. 38, Lecinski, 2011) He says that 70% of Americans now say they look at product reviews before making a purchase (p. 10, Lecinski, 2011).

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What is a customer anyway? According to the definition you get when you type the term into Google, a customer is “a person or organization that buys a good or service from a store or business.”

This is a very one-sided view of a customer — let’s get the money from customers, as much as we can. Sure, we give them value in return. But mostly, customers are the cow and brands are trying to pump them for as much milk as they can.

However, in the Harvard Business Review article What Most Companies Miss About Customer Lifetime Value (an article I’m reading as part of the Communicating Value and Web Conversion graduate certificate program form the University of Florida and MECLABS Institute), Michael Schrage insinuates a very different definition.

Customers as members of a company’s value-delivery ecosystem

In the article, Schrage, a research fellow at MIT Sloan School’s Center for Digital Business, explains workshops he runs with companies where he asks them to answer the question “Our customers become much more valuable when …”

                                                                   photo courtesy: Didrik, Creative Commons, Flickr

Here’s what really stuck with me about the exercise: “It doesn’t take long before the answers start to incorporate an investment ethos that sees customers more as value-creating partners than as value-extraction targets,” Schrage said.

How do customers add value? Everything from providing feedback, to word-of-mouth marketing, to being early adopters for new products.

However, I would argue that customers must first be satisfied before they are willing to engage in any of these activities.

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In his 1923 book “Scientific Advertising,” Claude Hopkins said, “Advertising is multiplied salesmanship.” But in the modern day, I’ve more often seen a tight comparison (and even confusion) between marketing and advertising.

On the other hand, marketing and advertising are distinct majors in college. Most agencies are advertising agencies, and most departments inside companies that promote the sale of products are marketing departments.

Why the distinction? Are these two words synonyms, or is there a real difference?

A high-level, ephemeral topic like this isn’t something marketers spend most of their time thinking about. They’re too heads down, focused on budgets and marketing automation and copywriting. I know I am.

But I came across that quote from Hopkins when I took MMC 5435: Messaging Strategy and the Centrality of the Value Proposition, part of the Communicating Value and Web Conversion graduate certificate created by MECLABS Institute in partnership with the University of Florida.

And so I started pondering the bigger, more existential topics of marketing, such as this one. Marketing philosophy, if you will.

                                            photo courtesy: “cVillain Sponsor Post” Creative Commons, Spicy Bear, Flickr

More than just nomenclature

To me, marketing is strategy and advertising is (but one) execution of that strategy …

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As you head into 2018, I hope you have grand plans on how to exceed your company’s goals, improve results and create even more effective customer-first marketing.

Whatever your plans are for 2018, it all begins with an idea — and the inspiration to carry out that idea.

Hopefully, here at MarketingSherpa, we’ve played even a small part in powering those ideas and providing that inspiration. To give you that little extra oomph before we cross the line into 2018, here’s a look at some of our readers’ favorite content from the MarketingSherpa Blog this past year.

Time to Move On: Three email marketing habits your customers are sick of seeing

We provided some ideas for email marketing habits you might want to break. Habits like tricky subject lines.

Or overlooking your email’s true call-to-action. “Actually, I kind of view it as a failure for that email if they do click on anything but my main CTA. That was the point of sending the email,” said Bart Thornburg, Senior Manager, Email Marketing, Wedding Wire.

Read the blog post to see if any of these habits look familiar to you from your email marketing campaigns.

Email Marketing: Five ideas to increase your email’s perceived value

Value, much like beauty, is in the eyes of the beholder. And for marketing, that beholder is the customer.

So how can you create value for your email subscribers and make sure they perceive that value?

For one thing, you should be thinking of your emails as more than just promotions. “Content-focused emails now sell just as well as the product-focused ones,” said Blake Pinsker, Marketing and Brand Director, MVMT.

Relevance is always key. For example, including product names in cart abandonment emails, “customers seem to have a really high open rate in that one because it recognized what they had been looking at not long ago,” said Victor Castro, Director of eCommerce, Zachys Wine & Liquor.

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