This post is an excerpt from the book Precision Marketing.
The relevance requirement
Market research demonstrates that consumer attention and interest are directly proportional to the salience of the message. The more compelling, valuable and relevant you make your messages and offers, the more impactful the messages become – and the more likely it is that your prospective and existing customers will respond. As you present your brand in increasingly relevant ways, you drive increases in revenue, response and, ultimately, return on investment (ROI).
Relevance, in other words, is now a requirement for marketing success. Yet marketers continue to lag in acting upon the urgent need to align market- ing and messaging to be relevant to their customers. When this is the case, marketers are putting their companies – and their jobs – in jeopardy. They are pursuing obsolete marketing approaches even as the outcomes associated with those approaches are clearly in decline.
Customers have growing power, leverage and influence. They have become adept at tuning out the irrelevant, and they are unwilling to listen to messages that don’t matter to them.
That consumers are tuning out noise is obvious. Not only is this claim validated by research, but also it resonates with personal experience. People are more likely to pay attention to a message that speaks directly to their own personal concerns and desires than to a message that speaks blandly and broadly to a mass audience of which they happen to be part.
How to capitalize on this nding, however, is much less obvious.
The power of Precision Marketing
As we see it, marketers are now challenged to engage their customers on a new and relevant level. This is where the definition and concept of Precision Marketing gain momentum. Precision Marketing is a process that, if followed with the key building blocks described in this book, gives marketers the insights into customer behaviours that let them talk with customers in a relevant manner. The Precision Marketing framework relies heavily on several key factors, the 1st of which is the collection and analysis of data. Marketers are no longer in a position where they can randomly create interesting advertising campaigns; they must be aware of their customers and talk directly to them or risk driving them away. Marketers must create actionable customer insights to accomplish this objective. Collecting the customer data that give marketers the information they need to build strategies framed on Precision Marketing customer insights is imperative to enable this objective. Data enable action- able insights. Consumers who are overwhelmed with irrelevant offers and messaging are less likely to deal with companies that don’t know them.
Marketers cannot produce compelling messages in a vacuum. Rather, they must now employ customer insights to ensure that their communications are aligned with the preferences and priorities of their customers. Marketers must also learn to integrate their messages within an overall mix of channels – a mix that encompasses everything from direct mail to social media to mobile communication.
So why aren’t more marketers implementing Precision Marketing today? On the basis of our work with numerous companies, we believe there are three key challenges to overcome:
- The 1st challenge is collecting the correct data. Approximately 70% of marketers gather only demographic and location data,9 which is not enough, because not all 40-year-old women in San Francisco are the same. Demographics and location by themselves are too imprecise. Today’s critical insights must be drawn from such factors as customer preferences and behaviours; unfortunately these data points are obtained by a much lower percentage of marketers.
- The second challenge is to act on the customer data that has been collected. Some marketers today may be collecting voluminous amounts of data, but they are often not aggregating and analysing that data to generate actionable insights. It is not enough for marketers to know what their customers prefer; marketers have to be able to predict their customers’ needs and propensity to purchase.
- The third challenge is execution and measuring results in order to test predictions. Here is where relevance plays a key role. Marketers must utilize highly relevant messaging and offers aligned to target customer segments. In addition, they must measure who converted, who did not, and, most importantly, why.
From our work with recognized firms in sectors such as banking, finance, telecommunications, insurance, publishing, hospitality and utilities, we have proved the power of Precision Marketing in real-world implementations across geographies, industries and applications. As advisers on marketing approaches to maximize customer engagement, we have learned how to meet these challenges and identify new growth opportunities. Our approach, which we call Precision Marketing, has produced extraordinary results for our clients in areas such as revenue, retention and ROI.