Tired of Segmentation That Doesn't Work?

If you're getting back to marketing basics these days, as many marketers are, the place to start is with the targeting decision. Profit-focused market segmentation research helps you nail targeting, as Copernicus' Henry Gamse explained in his recent webcast on the topic.

Check it out on-demand at: http://www.copernicusmarketing.com/consult/webcasts.shtml

Live Tomorrow! Free Webcast with 3 Tips for Finding Most Profitable Target

Marketers often complain that even after sinking a good chunk of change into market segmentation exercises, they still can't answer the question, "who are the most profitable customers for my brand or business?"

Tune in to a free webcast given by Copernicus' segmentation guru Henry Gamse tomorrow, Thursday, December 3, at 1 pm (EST) to learn how to integrate clever measures of profitability into your market segmentation efforts.

Henry will describe three critical steps any marketer can take to calculate the economic value of different groups. Using real-world examples and anecdotes, he'll bring ideas to life in a non-techical, easily-accessible way.

As an added bonus, attendees of the live broadcast will have the chance to ask Henry questions about their own market segmentation and targeting issues.

To register: www.copernicusmarketing.com/consult/webcasts.shtml

Good Protocals for Social Media Research Courtesy of IBM

There’s lots of talk about using customer insights and data gleaned from online sources to guide marketing decisions and programs, but we’ve been hard-pressed to find examples of how companies are integrating the information they are pulling off of the web with all the other information they collect on customers.

So you can imagine how excited we were to read the Wall Street Journal’s Emily Steel’s piece, Sifting Web Chat for Marketing Inspiration.

According to Emily, companies including technology giant IBM and casino operator Harrah’s, “are using new technologies to scan the web for key words to find out what consumers are—and aren't—saying about their brands.”

The music to our ears: “Then, they are incorporating those findings into their more-conventional research and using them not only to choose the overall themes of their marketing campaigns, but also specific text and photos for their ads.” In other words, the group of marketers she's writing about anyway seems to recognize they need to test out the anecdotes among a bigger population.

Like many marketers, we’re very excited about the possibilities on-line sources of customer insights offer. Reviews, comments, social networks, blogs, communities, searches, and more would all seem to offer some nuggets of information that marketers could use.

But, as you might expect, we also share some of the skepticism expressed by marketing thought leaders about the quality of the data—it’s the raw voice of the customer, perhaps, but which customers?

How do you know the folks posting comments are for real? Are their opinions truly representative of a brand’s target buyers? Who are these people?

Mary Egan at Boston Consulting Group also makes a good point in the piece: “Marketers also should be careful not to ditch their traditional market research, as it frequently reflects the views of consumers who are less loyal to a particular category or brand.”

"There is a broad swath of the population that is not on the blogs, and it is important to reach out to those people and bring them into the fold," she says.

A "C" in Customer Satisfaction

According to the latest findings from Professor Claes Fornell’s American Customer Satisfaction Index’s latest quarterly report, satisfaction came down a bit in the third quarter to 76 out of a possible 100. That's a "C" grade. While still a little over a point higher than a year ago, at least to our way of thinking, that score seems to indicate there’s plenty of room for improvement here.

Some categories did see all-time high scores in the third quarter, including the purveyors of candy and chocolates and beer.

“The same thing happened in 2001 in the midst of the previous recession and also in 2004 when concern over the Iraq War and rising fuel prices appeared to be reflected in higher satisfaction with comfort foods,” explains Fornell.

Still, even for companies in those sectors, the high scores were in the 80s.

Slip Ritalin in the Marketing Department's Water Cooler: And Other Tips for Keeping the Marketing Plan on Track

Take a look at Copernicus' own Kevin Clancy's recent webcast, "Lifting the ROI of Innovation Efforts: Keep the Marketing Plan on Track," at your leisure, on demand via:

http://www.copernicusmarketing.com/consult/webcasts.shtml.

Don't Kill Positioning

We came across Don Schultz’s article in the recent edition of the AMA’s Marketing Management, as well as a post by Jay Baer on Convince and Convert that seemed to have divergent points of view. So let’s discuss.

Among other ideas Schultz puts forth in his article, “Transformational Branding,” he makes it clear he thinks positioning, “the most important marketing concept of the 20th century, is probably no longer relevant.”

Because “marketers don’t control enough of the brand communication to develop a ‘market position,’ and certainly not enough resources to maintain a viable position once it is in the marketplace,” to even try to put a value proposition out there has become an exercise in futility.

“Today,” he writes, “customers do that through social networks, blogs, and Twittering—tools marketers have yet to understand, much less master.”

OK, let’s breakdown some of his points.

First, there’s “positioning is no longer relevant.” We might agree there aren’t too many brands that have one these days, that’s true. One study we did in the last few years found only about 8% of brands had what would fit even the loosest definition of one.

We don’t think, however, that the current state of affairs is because the concept itself isn’t pertinent to marketing anymore. Quite the contrary, even Schultz agrees that brands should still stand for something.

So what’s going on?

Well, it could be the way many marketers go about selecting a positioning in the first place. They come up with something they think will appeal to a particular group of buyers they’re trying to woo and run with it. If the message marketers put out there doesn’t resonate with the intended target, well of course they aren’t going to pay attention to it. They’ll go on about their business and talk about something else.

This reaction has nothing to do with whether it makes sense any more to try to have a positioning—it has to do with whether the positioning message itself is relevant to customers.

Or it could be that the means of communicating—the media and promotional weight put behind a campaign, the different media and promotions, and/or the creative executions themselves—aren’t getting the positioning across. If the message marketers put out there doesn’t get through to the intended target, they aren’t going to know anything about it. And they’ll go on about their business and talk about something else.

This reaction has nothing to do with whether it makes sense any more to try to have a positioning—it has to do with how well the positioning message itself gets through.

Yes, customers talk about and share a lot of opinions and information on-line. It spreads a lot further, a lot faster than it used to when folks were just chatting up an ad or sharing a poor customer service experience around the water cooler, that’s also true. But this doesn’t mean that brands are now solely at the mercy of whatever the online population wishes to discuss.

We tend to agree with Jay Baer that in most cases, “customers are probably not desperately trying to connect with your brand in social media,” unless you give them a, by the customer's definition, good reason. He wonders: “Why would a customer want to connect with your company online? What’s the benefit? How well does doing so provide value, or helpfulness, or enjoyment? You must make the case to the customer that by NOT connecting with you, they are missing out on something of value. And you have to deliver on that promise.”

We’re not sure at this point marketers could or should conclude that they’ve pretty much lost any and all control over how people talk and think about their brands, so it’s not worth even trying. And we definitely don’t think now is the time to throw out core concepts like identifying a space in the minds of customers and prospects that you’d like your brand to occupy, to borrow from Jack Trout’s and Al Ries’ classic definition of a positioning.

RIP: Wal-Mart's Casket Experience Offers Lessons in Social Media Monitoring

Social media research has it's pluses and minuses, as most marketers know. Wal-Mart's recent experiences as described in Ad Age's Craig Daitch's blog post, "Social Media Pranksters had fun with Wal-Mart's Caskets," gives a pretty good demonstration why marketers have to take care.

News quickly spread about Wal-Mart's new line of caskets offered on-line and apparently some budding comedy writers took it upon themselves to post fictitious product reviews that Wal-Mart has since taken down. But before the company did, news and comments about the new offering spread around the social web. Had Wal-Mart looked purely at reports or analysis without really taking a close look at the actual postings, the company might have concluded purchase interest was through the roof. Meanwhile, in reality a bunch of jokers were just having a good laugh.

Daitch makes a good point: "while you're fine-tuning the 'what, where, when and how' as you're eavesdropping on conversations around the social web, remember that while analysis can be assisted through technology, it's by no means a fully automated process."