Book – Team of Teams

team.pngThe book is an excellent explanation of changes in our environment and why organizations will be more successful with a new approach to management.

The most interesting point is the parallel between business and military organizations.  The current change is not limited to a specific industry or military branch; it is a societal change every organization will face.  We have to choose between efficiency and adaptability.  Adaptability we need to succeed in our complex environment reduces efficiency, what is difficult to accept.

“High-level success depends on low-level inefficiency.”

Silo-based organizations with internal competition have been successful in the past.  However, as our environment shifted to the high level of complexity (and high level of unpredictability), silos-based efficiency is insufficient.  This type of organizations have limited access to information and internal resources to solve problems spanning across different work groups.

Example: GMs separate ignition and airbag teams could not solve an ignition issue affecting airbags for several years.  Nobody in the organization had access to all needed information and incentive to take any actions interfering with the organizational objective of cost reduction.

To become more effective (at the expense of efficiency), the organization need to encourage the free flow of information and introduce “system thinking” across levels and departments.   “A person can not understand a part of the system without an at least rudimentary understanding of the whole.”

The solution is to share the information and empower people on all levels to make decisions based on this information.  In complex and unpredictable environments leadership role changes from “chess” to “gardening.” Instead of attempting to orchestrate and control every organizational move, the leader needs to concentrate on the high-level picture and provide an environment for fast decision making across the organization in the context or each situation.

However, information without empowerment would be frustrating, and empowerment without information would not generate success – both components need to be present in the organization to generate results.

To prevent natural mistrust beyond members of an immediate team, a military organization started to “embed” representatives of other functions into the team’s environment.  Team members learned to trust a person representing different function and become more open to cooperation with the same function in the future.  This approach created a “team of teams” ready to work together on overarching organizational goals.

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Book – The Ultimate Question 2.0

question.PNGI thought I knew what NPS was.  A few years ago I worked for a company, which had a survey with one NPS question on its website.  Other companies discussed NPS, and I also read an extensive article criticizing the approach for generating the score, but not explaining the “why” behind it.  In the reality, I had no idea what NPS was, how it should be used, and why it makes business sense.  Most likely, I was not alone 🙂

The general calculation of NPS is simple to understand and it is a well-known concept.

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The rest of the book became a wonderful discovery for me.

Interestingly, the specific question was selected based on rigorous research, and it was not the question researchers themselves expected to “win.”  This was the question, which correlated the most with business success of the company.

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“In certain business-to-business settings, a question such as “How likely is it that you will continue to purchase products or services from Company X?” or “How likely is it that you would recommend that we do more of our business with Company X?” may work better.”

Calculating NPS (% of promoters – % of detractors) rather than just concentrating on the % of promoters “… worth the trouble, because it ensures that a company will pay attention to both groups and because NPS correlates with growth rates more closely than does the number of promoters alone.” 

The question generating the score should be “called penultimate question since it always needs to be followed up by one additional question: why?”

Companies with higher scores enjoy clear business benefits compared to their counterparts in the same market.  Interesting: average scores in different markets can vary widely; it is important for the company to become a loyalty leader in its particular industry and geographical location rather than reach a particular score.

Multinational businesses with multiple product lines won’t be able to compare their absolute scores across the company.  “To manage their business portfolios, these companies allocate resources toward growth opportunities in business units that enjoy NPS leadership [in their markets], and then to unit managers who develop compelling business cases that should enable them to drive NPS past the current leaders [in their markets].”

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Concepts and points from the book:

  • “NPS merely measures the quality of a company’s relationships with its current customers, and high-quality relationships are a necessary but not a sufficient condition for profitable growth.”
  • Does it make sense to worry about NPS in regulated monopoly markets?  “…No monopoly lasts forever.  New technologies emerge.  Regulations change.  Building good customer relationships prepares a company for the possibility of increased competition.  What’s more, superior NPS boosts a company’s growth potential by enabling it to expand into adjacent service areas.
  • An inability of the accounting system to distinguish between “good profits” based on the creation of value for customers and “bad profits” can be overcome by NPS.  “Did that $10 million in incremental profits come from new hidden surcharges, or did it come from loyal customers’ repeat purchases?”
  • Should companies measure NPS in all customer segments and categories?  This question can be addressed by “…two distinct processes that are best managed separately.  Companies that must serve a wide variety of customers in addition to their targeted core – retailers, banks, airlines, and so on – need to minimize detractors among noncore customers, since these customers’ negative word of mouth is just as destructive as anybody’s.  But investing to delight customers other than those in the core may yield little economic return.”
  • NPS-1.pngOverall: “The more metrics you track, the less relevant each one becomes.  Each manager will choose to focus on the number that makes his decision look good.”
  • Additional potential question: “What is the most important improvement that would make you more likely to recommend us?”
  • Product management team at Logitech is expected to project the release date, the retail price, and the target NPS for every new product they propose.
  • TurboTax ads another question based on the initial NPS answer.  Detractors are asked for the reasons for their score, passives are asked what would take for them to rate TurboTax a ten, promoters are asked what, specifically, they would tell someone to get them to try TurboTax.  Promoters responses could be incorporated into future marketing messages. “One final benefit of asking promoters to express what they would tell a friend is that once they articulate the answer, they are more likely to relay it to a friend just because it’s on the tip of their tongue and the top of their mind.”
  • The amount of work, planning, and follow-up required to achieve the full benefits of NPS came as a surprise to many of the companies.”
  • The authors encourage companies implementing NPS to be careful about linking the score to compensation.
    • It creates the focus on the score itself, rather than an improvement of customer satisfaction
    • It creates pressure on the team responsible for the measurement process
    • It encourages gaming and manipulation
  • A lesson from companies who implemented NPS: “I wish we had known to budget more support from our IT department up front.”

Another interesting aspect of Net Promoter System is a measurement of employee advocacy and the emphasis on employee satisfaction as a starting point for the creation of happy customers.

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  • The question: “On a scale of zero to ten, how likely is it you would recommend this company as a place to work?”
  • “With anonymous employee surveys, it makes sense to gather a little more information about possible root causes on the survey itself.”
  • “Apple Retail began its Net Promoter for People process using quarterly surveys.  But it found that store teams didn’t have sufficient time to diagnose root causes, implement solutions, and achieve measurable improvements before the subsequent survey.  So Apple shifter to a four-month cycle.”

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Book – Experiences: The 7th Era of Marketing

experiences.pngExcellent book!  The authors suggest a somewhat different view on content marketing – an experience-based approach.  A concentration on the experience itself as the “product” is the 7th era of marketing.  The content marketing in this era should become an additional experience for the customer, independent from the product or service the company provides.

As experiences, in general, become more and more important for new generations, entrepreneurs take notice.  An interesting example of a pure “experiences” business: https://www.ifonly.com/

The business “sells” experiences and generates donations to different causes at the same time.  The business is a typical platform, which connects “experience producers” with “experience consumers” and does not own any “experiences inventory” itself.

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The future: share of voice and share of wallet will change to the “share of experience.”

Brands can pay for rising above the noise, but they can not pay for showing experiential value for the customer – this value needs to be carefully designed.

Instead of four Ps of marketing, the authors suggest a new approach: SAVE

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  • There is no correlation between a number of interactions a brand has with the customer and depth of relationships.
  • IT systems: consider them systems of engagement rather than systems of record. If a business can invest into systems of engagement, IT becomes a point of differentiation in the marketplace.
  • Practical approach to creation of experiences in the organization; ask for forgiveness rather than permission 😉
    • Content marketing center of excellence success: “it was important for us to position our content center of excellence and our team as nearly an extension of processes we already had in place”
    • “…they did not go to management to organize the group – they created a function and went to management to formalize it.”
    • Skunks Works issue – the team might fight for their project’s survival, which might be difficult to incorporate the project into the overall business.
  • Important – evaluate experiences instead of teams; encourage cooperation in the organization and inclusiveness.

How to allocate investment into content? 

  • content.PNGExpensive – low-risk content; inexpensive – high-risk content
  • Coca-Cola uses 70-20-10 approach:
    • 70% of efforts are allocated to the content, which has to be produced
    • 20% – slightly “out of the box”
    • 10% – high-risk creative content (this part is not as expensive as marketers think, but it takes more creative time to come up with the content)

Story mapping:

  • why.PNGWhy (content mission) – value we deliver to the audience; who will receive the value and why would they care; how this initiative aligns with the larger story of the brand; how this experience will be different from what is available in the marketplace of ideas
  • What (what does the success look like and when is it going to be achieved) – differentiate the success of the initiative and the mission of the business – how the initiative will integrate with other parts of the business
  • How (proposed map) – how do we approach the initiative over time

Interesting CMO requirement to achieve alignment: when pitching an idea, the team is required to explain how the initiative will be cross-functional.  This requirement assures cross-functional buy-in in advance.

Four layers of customer experience focus:

  1. Awareness and introduction – lightweight tech, almost disposable – marketers will need to move fast and CIO should care less about this layer. (Flexible, portable, and disposable).
  2. Engagement and relationships  – as visitors become leads and opportunities, more data is needed to provide delightful experiences down the road.  Unified customer experience management solution is critical. (Engagement management – needs to interface with everything above and below)
  3. Intelligence and insight – after leads become customers, it is important to understand how needs of customers evolve.  The ultimate goal is to create brand evangelists.  Integration is the key.  CIO must work with CMO to understand which data is needed.  (Core data management – closely adheres to standards).
  4. Shared values and exceeded expectations

New marketing technology is “built to change.” 

Analytics: marketers often use metrics unrelated to business objectives.

  • More traffic – great!  …even if it happened because a negative comment went viral?
  • More time on site – great!  …even if a prospect cannot find the next step and conversions are down?
  • More likes on Facebook – great!  …even if liking the page is needed before customers can post comments how much they hate the company?

Analytics layers:

  • Primary indicators, goals (Example: increase MQLs by 10% in 6 months with only 5% budget increase – includes Objective > Timeframe > Constraint)
  • Secondary indicators – KPIs – progress toward primary goal – what helps us to improve the possibility of achieving goals (Example: unqualified leads, cost per lead, downloads, seminar attendees, etc.)
  • User indicators – data points we collect on daily basis, which help us to improve secondary indicators (Twitter followers, page views, etc.)

This approach does not require reporting secondary indicators; this can allow teams to concentrate on reaching goals through initiatives, which might reduce site traffic, for example.

An important objective is to de-silo the measurement so different groups do not compete with one another for audience attention.  Example: an insurance company team launched a blog and asked a website team to place a prominent button on the home page of the company site.  Website team said “no” as blog traffic won’t be counted as site traffic, and web team was measured on site activity.  The blog team asked social media team to promote the blog; the social team also said “no.”  Social media team was measured on engagement, and cute pictures of cats were receiving over 1,000 likes, while insurance articles could generate less than 10.

  • A “channel” team should be responsible for an “audience development” instead of a channel.
  • Content-driven experiences are not measured separately – they are part of marketing strategy.
  • You don’t measure channel – you don’t measure how many leads telephone produced…  it is just a part of the whole program called “sales.”  Content is the part of the entire program.  But – you should examine content contribution.”
  • “The objective of a blog can be the traffic to website – everything does not have to produce sales directly.”

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3 skill sets are common in companies succeeding in content marketing:

  • orchestrating events, not guiding journeys
  • meaning-driven, not data-driven
  • organizing for agility, not speed

BMA – Fixing the Mid-Funnel

funnel.pngThe discussion focused on the mid-funnel – the “new problem child” for many marketing organizations.

Our environment:

  • 50% of marketers are compensated on generating pipeline
  • If prospects engage beyond MQL, they are more likely to become SQL
  • Natural resistance to engage with the company

How do most marketing organizations solve mid-funnel problem?  At this point, most organizations are either:

  • not doing anything at all or
  • not doing it very well
    • It is challenging to engage prospects; some marketers do it with low productivity, many struggling to accomplish anything

But..   how do we know that we have a mid-funnel problem?  We can look at how mid-funnel is working now: What is conversion rate?  What is sales process?

There is a small segment of marketers, who are unaware about their challenge – still concentrating on the top of the funnel.

“I can just crank out an e-book and drive engagement…”  What is important for mid-funnel?  Connection with sales.  Both speakers suggested integrated programs where general marketing tactics (email, webinars, etc.) are integrated with outbound calling. 

Example: start with the objective, then send an email and call to those who responded.

Example: target mid-funnel with an appointment-setting campaign.

New term (for me): multi-match – getting more responses out of a single lead.

How many touches are needed overall (email, etc. phone) – usually 7 – 13+

Which marketing tactics are effective in mid-funnel:

  • webinars
  • seminars
  • email
  • outbound calling

Product information is useful at this stage: “These guys love speeds and feeds…”  “I would send a copy to sales people to check what will resonate with the customer…”

Any specific recommendations for compressed sales cycles?  Outbound calling!

sales-marketing.PNGConnection with sales is critical.  How do you engage sales team?

“If I can get sales rep to accelerators (a level of revenue when the rep receives an increased commission), I am speaking to their wallet, which is next to their heart.”

Understand what sales priorities are.

“First, get prospects ‘on the buss,’ then, entertain them by marketing to their pain points…  make sure to speak in the customer language, so they are more likely to get to the next stop.”

Example: one rep wanted to connect with CIO of a major bank.  “Do you know that your CIO is on the board for boys and girls club of NYC?”  Rep sent one tailored email based on this information and received the reply.

“Up-level your marketing team to be more strategic!”  When you are talking with sales, talk in strategic way.

Valuable tip: “We do pre-recorded webinars…   we also pre-record Q&A at the end of the webinar, as it is much easier to manage – result is the same 🙂

BMA – Communicating Marketing’s Performance: The CMO Dashboard

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This insightful presentation included guidelines for creation of a useful dashboard and typical mistakes companies make at the point of dashboard planning and creation (plus examples!).

SiriusDecisions have a very clear approach to measurement in general: people and process first, data and technology second.  The fact that successful measurement organizations spend over 60% of their efforts on the social side of the process is incredibly insightful.

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Creation of a dashboard needs to start from business questions.  NetApp example represents the first step of dashboard development – a “dashboard” of business questions.

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At this point, every person in the industry is probably aware about “silly” irrelevant metrics, which, sometimes, find their way into documents designed to show business results.  Yes, number of “likes” is not a useful business metric.  However, there is another kind of irrelevant metrics, which are more difficult to detect.  These metrics might be quite beneficial for some organizations, but not others at a certain point. If the company’s goal is retention and the dashboard highlights acquisition of new logos, the metric is not relevant for the objective this company is trying to achieve.

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Other curious notes from the presentation:

  • CTR – “back up metric”Sirius.PNG
  • “Pictures worth a thousand spreadsheets”
  • Unfortunately, quite common issue: “it takes 60 hours to produce the report…  we do not have time to analyze the data…”
  • We serve more audiences than just sales, but we get sales myopia
  • “Do you spend 100% of your budget on demand?  No.  Then, why do you measure demand only?”
  • SNOS – shiny new object syndrome
  • Irrelevant metrics are not silly, they are not aligned with organizational objectives

Excellent presentation!

BMA – Artificial Intelligence for Customer-Centered Marketing

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As usually, a thought-provoking event with the main idea “think about an opportunity AI presents!”  We, marketers, often concentrate on shortcomings of current AI to help us do our jobs now, rather than explore the opportunities.

  • Connection of AI and marketing: AI may not need to be incorporated into marketing process itself; AI creates efficiency in production, which allows (requires?) more products to be sold.  Selling products is marketing job…
  • Chat bots are often owned by technology and used to improve web site navigation – it is an opportunity to engage with a customer and should be managed by marketing.
  • Very interesting approach to mobility overall from marketing perspective: “Your customer is talking to a car…  think about the opportunity!”  🙂

 

BMA – Content Marketing at Adobe

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This insightful event focused on content marketing in its broader sense.  This approach is both reasonable and refreshing.

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Interesting – expert content is more valuable that user reviews for purchase consideration. Though preference for expert content was known for years, comparison between expert content and user review is new (for me).

Opportunity outlined by the presenter: we need to create experts.  Now, demand generation is thought leadership.

Not all subject matter experts are good writers; pair good writers with SMEs.

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An unusual approach to “content” is Virgin America campaign to promote its First Class features.  What could be more boring?  Not quite…  A unique pair of sneakers including representation of first class amenities was offered on eBay.

Lyft grew out of a common passion point: feeling part of a community. The company launched a campaign called “Undercover Lyft,” featuring celebrity and local hero Lyft drivers who picked up unsuspecting customers. Through its campaign, Lyft made clear to customers that it understood and could deliver on the need for a sense of community.

Social-media-optimized videos:

  • Social videos work well on Twitter and Facebook, but not on YouTube and LinkedIn.
  • Keep videos to 45 seconds or less in length.
  • Captions are imperative, since 80 percent of viewers will watch without audio.
    Put targets on the audience you want to reach and money behind the posts.

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