Monday, January 31, 2011

Is 2011 the Year that Mobile Finally Becomes Mainstream?

The cover story in the January 30 issue of Marketing News presents a solid argument that 2011 will be the year that mobile marketing finally becomes mainstream in the United States. For years, marketing prognosticators have been saying that mobile marketing would reach a critical mass, so when I saw the headline This Time It’s Different, I was curious as to why their editors felt that 2011 would be different. Here's what I found:

82% of U.S. consumers now own a cell phone, according to Forester Research. Tablets such as the iPad will reach 54.8 million units in 2011, according to Gartner Inc. and annual global tablet devices will reach 81 million by 2015 according to Juniper Research.
These are boxcar numbers that support their conclusion that 2011 will be different, but the real story is more than just about numbers. Mobile phones and devices have increasingly become an integral part of our everyday lives, and for many of us mobile is the “first screen” in our lives. When mobile first came on the scene, it was the third screen - behind TV and the Internet. Now with the advances in technology, and the widespread use of text messages and apps, mobile has become the first screen. It’s something your clients and their customers, no matter who they are, trust and use throughout the day.

The explosion of 3G and 4G devices, growth in data plans, and the resulting acceptance of smartphones are three key drivers for mobile growth.
According to recent comScore data, among mobile subscribers 13 and older, nearly half (48.9%) have 3G or 4G devices, up 23% from 2009. Their data also show that 33.4% of subscribers have some sort of data plan, and among those consumers, 83.9% have unlimited data plans. They now estimate that more than a quarter of U.S. consumers have smartphones, a 68% increase from 2009.

Apple’s iPhone and Google’s Android are leading the charge on improving customers experiences on mobile phones, which will boost industry growth.
And we can't forget about RIM/Blackberry, Windows OS, and Nokia's Symbian OS. When you hear the phrase “there’s an app for that”, it’s true. There are now almost 300,000 third-party applications officially available on the Apple App Store, and last week Apple announced they had reached over 9.9 billion downloads. It’s becoming second nature to shop, do research on products and services, and communicate with your friends throughout the day because the new phones are so easy to use.

Spending on mobile advertising is expected to grow more than six fold over the next four years.
Spending is expected to reach nearly $2.55 billion, according to eMarketer, a New York-based digital marketing research firm. Along with consumer’s increasing mobile usage, growing ad spending on mobile will help to fuel its growth. Julie Ask, a vice president and principal analyst in mobile and telecom at Forrester Research, feels that “the larger screens have resulted in an increase in media consumption, and that generally leads to more advertising.” A recent survey by the Mobile Marketing Association of 200 executives found that 24% of respondents said they would more than double or even triple their investment in mobile advertising in 2011 compared with 2010.

Other factors cited include the growth in “tools you can use” to aid your marketing efforts.
Mobile payment technology, mobile gift lists and mobile gift cards will open more opportunities for savvy marketers to take advantage of mobile as an important part of their marketing plans. Many marketers are now experimenting with text messaging to alert shoppers to deals, and mobile apps have moved beyond games and GPS to include everything from recipes to tips for parents to teach their kids smart eating habits. Another growing trend is location-based marketing, and companies like Foursquare allow users to find special deals while in-store where they can make an immediate purchase.

Analytics will provide the final piece of the puzzle to marketers.
Michael Becker, managing director for the Mobile Marketing Association calls analytics “the connective tissue of mobile to traditional media”. The ability to track direct sales or indirectly influenced sales through mobile is expected to grow significantly and allow marketers to monitor sales activity in real time. With increased recognition of the valuable potential of having an interactive mobile device in the hands of consumers at a time when they are requesting support from your clients will entice more marketers to find ways to leverage that capability.

MMA’s Becker concluded the article with the statement that “mobile is where the customers are. It’s as simple as that. Old world marketing was about attitudes, awareness and usage. New world marketing is putting the focus on making sure that you, as a marketer, are there at a time of a consumer’s expressed need.”

With mobile marketing, a company can respond to their customers when they need them. No matter where they are at the time.

What about your agency and clients? If 2011 is, indeed, when mobile finally grows up, are you ready to take advantage of the opportunity?

Monday, January 17, 2011

Measuring Social Media Engagement is a Journey

I recently attended a presentation by Sean O’Driscoll, CEO of Ants Eye View on how to measure social media engagement. He gave the audience an in-depth look at the various stages a company must go through to truly embrace and ultimately measure social media and its impact on their business. He described the process of implementing and measuring social media as a “journey” whose destination is to become a fully-engaged enterprise that creates a measurable impact on brand health and business through customer engagement.

The journey begins with an understanding and acceptance that to compete in today’s marketplace, a company should invest in building long-term relationships with their consumers.

There are several key factors that support this conclusion.
• Technology has lowered the barrier to competitive entry, and competition is more intense than ever.
• Consumer trust has shifted dramatically away from corporate America, and has been replaced by a heavy reliance on peers, friends and even strangers online.
• The adoption of digital tools and social technologies has changed expectations in consumers’ minds – they now expect engagement and service in real-time.
• Consistently engaging your customers requires marketers to be in the places where they are, not necessarily where you want them to be.

The journey for an enterprise to become fully engaged in social media typically has five stages.

Stage 1 can be described as Traditional, where a company is focused on traditional marketing tactics and is ambivalent to online conversations about their brand. Surprisingly, there are still many companies at this stage; where social media is not even on the executive’s radar.

Stage 2 is described by Sean as Dabbling in Silos, where socially active mavericks within an organization begin to monitor conversations but there are no formal teams in place. At this stage, the customer data they gather is not connected with business goals.

At Stage 3, the company begins to Operationalize their social media effort through an empowered team run by a proven leader. Listening to their customers begins to generate implications and provide a baseline for metrics, and the company begins to explore tools to consolidate the data.

Real Results begin to surface in Stage 4 when channels start to yield impactful results and systems and tools are optimized. At this stage, employees in all departments are actively engaged and competent, and company executives are invested in analytics.

Stage 5 is where a company is a Fully Engaged Enterprise in social media and the effect on business outcomes and the organization are substantial and measurable. Business outcomes include the ability to bring products and services to market with built-in demand, manage risk better, and result in more efficient research, development, marketing and support operations.

At this stage, the organization sees increased revenue and loyalty, and customer engagement is a part of the company DNA. Importantly, the entire employee base has a 360 view of the customer and can anticipate their needs. Sean cited Starbucks as an example of a company that has reached Stage 5 through their use of social media tools like Twitter, Facebook and YouTube and how they listen and respond to customers through their My Starbucks Idea site.

The measurement journey also moves through stages and is the hardest part of the social media equation.

The four stages of measurement move from merely gathering data to using that data to evaluate brand health and business impact. The goal is to show the connection between online customer engagement and business value, but measurement requires programs that are scaled, predictable and resourced.

Sean identified four approaches for measuring social engagement – measuring behavior, monitoring claimed behavior, testing alternatives, and data mining.

Behavioral tactics examples include using coupon codes specific to social media channels (Dell Outlet), social media URLs to build online communities coded into web reporting suites with embedded upsell/cross-sell ads (Intuit). This tactic works because it records actual product adoption, but doesn’t work when social media is “part” of the purchase process but not the last step. Sean cited Amazon reviews as an example of people using social media for peer reviews, but then completing their actual purchase on alternate sites.

Monitoring Claimed behavior via customer panel research is a long-used method that provides some measure of the social media impact on brand health and business impact, but is always subject to skepticism because it is based on what people say they do without knowing if they have actually done what they say. Despite this obvious drawback, monitoring Claimed behavior can still be useful when other data is not available, and when measured over time to discern trends and consistency of response.

Two Testing tactics cited by Sean were A/B testing of specific websites with alternative engagement functionality or testing Twitter messages for reach, click-thru and conversion. Testing alternatives provide a concrete comparison, but doesn’t work when sample sizes and data sets are too small to be reliable, or when you don’t have the time and resources.

Data mining on criteria such as matching community profile data to customer sales data and comparing to non-community customer sales or cross-tabbing verbatim comments with customer satisfaction measures are proven tactics for measuring success. However, the accuracy of the data and large data sets are prerequisites, and specialized expertise is required. Based on that, Sean felt Data mining was the most difficult tactic for most companies.

In response to audience questions, Sean felt that Claimed measurement was probably the most beneficial for smaller companies with limited resources.

All in all, this session was a good overview of the social media landscape and will provide a good basis for discussion with my clients who say "I think social media may be important but can it really impact my business".

Where are your clients on the social media journey?

Tuesday, January 11, 2011

2010 PR Lessons On How To Handle A Crisis

We saw the positive results of an effective PR crisis plan almost 30 years ago with the famous J&J tampering incident. But the harsh memories of the financial and housing crises, coupled with resentment toward government and a growing public mistrust of all business, make the importance of a PR crisis plan today more important than ever.
In today’s online world, the 24/7 instant news cycle and the swift response potential of a skeptical and increasing militant blogosphere, require that your crisis plan should be reviewed and updated on a regular basis so that it can be implemented on a moment’s notice. That’s why I thought it would be helpful to review three key PR mistakes that made headlines in 2010 and gave us these important lessons:
  • Make sure you have a spokesperson for the company that will be seen as honest, transparent and sympathetic by the public both on and off camera.
  • Don’t try to minimize the problem or ignore public perception, because perception is reality to the perceiver.
  • Be ready to move quickly and decisively to repair public trust in your brand, and find a way to give the public “permission to believe” you have resolved the issue at hand.

Tony Hayward wanted his life back . . . but what about the millions of Gulf Coast residents’ lives and livelihood his company’s negligence disrupted?

BP’s image suffered a major setback with the Deepwater Horizon oil spill disaster, yet BP responded fairly quickly with ads showing their efforts to clean up the mess and “do the right thing”. One early commercial featured then-CEO Tony Hayward with a pledge that taxpayers would not be footing the bill for clean-up. Despite public skepticism kept fresh by daily media updates on the massive spill and memories of the Exxon Valdez travesty, public opinion remained somewhat positive toward the BP brand.

When Mr. Hayward traveled to Louisiana to survey the damage first hand, his prepared statement began with an apology. “The first thing to say is I’m sorry,” he told reporters. Unfortunately, his unscripted comments in response to reporter’s questions destroyed whatever goodwill remained for BP. When asked what he would like to tell locals whose livelihoods had been affected, his response that “We’re sorry for the massive disruption it’s caused their lives. There’s no one who wants this over more than I do. I would like my life back.”

His answer angered locals and became a lead-in for news stories around the world. It wasn’t the first time that the British executive had caused anger with his comments. He had previously described the spill as “tiny” compared to the size of the ocean. He also asserted that the environmental impact of America’s biggest oil spill, and of the 950,000 gallons of toxic dispersant that have been used to treat it, would be “very, very modest.”

While the CEO is a natural, and normally good, choice as a primary spokesman during a major crisis, if he can’t be consistent as a reassurance to the public, he may not be the right fit. The key lessons learned in the BP story are to find a public face that can be empathetic and sympathetic to public concerns and who will be consistent and stay on script.

Steve Jobs tried to minimize the problem with the iPhone 4, and forgot an important CRM rule – the customer may not always be right, but ignoring their concerns is never a good idea.

Apple has had an unbelievable string of successes with the iPod, iPhone and iPad. But that streak ended when Consumer Reports said it would not recommend buying the iPhone 4 because its tests showed a hardware defect that caused the phone to lose reception when held a certain way.

Steve Jobs is thought to be one of the most savvy executives in U.S. business, but his refusal to accept that evaluation and his initial response that the problem was in the software and could be easily fixed was not his finest hour.

In a press briefing, Steve stated that “the iPhone 4 is using a very advanced new antenna system – a more advanced antenna than ever has shipped on a smartphone before." And, later in that same briefing, he said "looking at the data, we don't think we have a problem."

When negative comments continued to make news, Apple’s primary defense sought to transfer the problem to all phones. Official statements from Apple began by saying that “every phone's reception sucks when you hold it. Gripping any mobile phone will result in some attenuation of its antenna performance, with certain places being worse than others depending on the placement of the antennas. This is a fact of life for every wireless phone."

Eventually, Apple admitted the flaw and offered a free case to iPhone 4 users that alleviated the problem But this PR gaffe may have opened the door for Android phones to impact future sales. It certainly damaged the previously unassailable reputation and magic of the Apple brand.
The lesson here is obvious – always listen to your customers and if they are telling you something is a problem, don’t ignore their concerns.

Toyota initially drug their feet when faced with a quality issue, but when they finally responded, they focused on how they were changing their processes and introduced a new customer assurance program.

Toyota shook up the automotive world with a quality message that Detroit either ignored or could not match, and for 30+ years they enjoyed the benefits of that brand position. But in 2010, the car maker had to pay a $16.4 million fine for its failure to quickly disclose potential safety defects, and more recently was hit with $32.4 million in civil penalties for failing to properly disclose what it knew about safety defects. PR consultants say that Toyota was slow to respond and didn’t clearly explain the cause of the problem.

Experts now say that although Toyota has lost some market share, they are repairing their image with the help of ads that talk about their Star Safety Systems and showing that they are changing some processes that assign more engineers to monitor quality problems and extending time devoted to testing new models. Toyota execs now say that they are seeing the number of competitor trade-ins “returning to historic levels” and that customer loyalty shows “encouraging signs”.

The lesson here is to be prepared to respond on a moment’s notice, and don’t just say that you are fixing a problem, show your customers how you are doing it.

The overall lesson is that an unexpected corporate crisis is not a reason to panic . . . if you and your clients are prepared.