Successful Marketing Still Begins With Understanding Your Target Audience

Last week, I was reminded that successfully using today's digitally-focused marketing tools must still be based on a smart marketing strategy that understands and appreciates the target customer. Rod Brooks, CMO for PEMCO Insurance gave a sold-out luncheon crowd in Seattle a great lesson in Marketing 101.

For the past year, PEMCO has been running a wonderful local campaign positioning their company as the local insurance company that really understands its customers. The campaign profiles local stereotypes that feature some of the unique, and often quirky, habits and characteristics of people in the Northwest. The campaign sign-off sums up the campaign: We're a lot like you. A little different.

The goal was to connect Northwest values to PEMCO and "own local".

Rod recounted for his audience the basic steps his marketing team took in analyzing the competition (SWOT analysis, etc.) and performing an in-depth review of the general mindset of people toward insurance (not a pleasant experience since insurance is a product that you pay for but never really see, and you can only "win" by "losing"). But two key steps they took are a great reminder for any marketing organization.

First, they did extensive internal reviews to identify and articulate their company culture, values and challenges. Rod knew that good positioning and branding for a service company must come from the inside out; it must be based on who and what you truly are or it is doomed to failure (think about all of those banking commercials that tout friendly service but don't deliver).

The second step was to conduct a series of ethnographic interviews to identify and understand the values that are unique to the Northwest region. Some of those values - fiercely independent, incredibly green, regional pride - were pretty obvious to anyone who lives here. But the two most important conclusions PEMCO made about Northwest consumers are that they love the local guy (there is a very strong local food movement) and they take great pride in their quirky but often colorful local habits and characteristics.

The campaign features these local habits and characteristics in a humorous, self-deprecating way by introducing us to "Relentless Recycler", who judiciously washes, and re-washes, every item before it goes into the recyle bin; "Blue Tarp Campers", who ignore the rainy weather and enjoy their camping experiences through the aid of overhead cover; "Roadside Chainsaw Woodcarver", local artists found in almost every Washington community; and my personal favorite, "Sandals and Socks Guy", an interesting dress code that in my experience is only found in the Northwest.

There are other humorous profiles that relate to individual communities, like the "Fremont 60's Holdout" and the "Marymoor Off-Leash Dog Lady", but all represent the odd, quirky but also colorful nature of Northwest residents. Recently, PEMCO added an interactive website (http://www.werealotlikeyou.com/) that allows visitors to upload their own photo and headline to add to the growing list of profiles.

Word-of-mouth for PEMCO has increased over 300%.

The total PEMCO campaign is a great story in successful integration of multiple media, as it uses traditional media -television, radio and print - in conjunction with community relations and events, and a strong digital component. According to Rod Brooks, word-of-mouth about the PEMCO campaign has increased by over 300% since the campaign began. Sales are growing, and the intangibles of internal company pride and excitement have made this a model campaign in the Northwest.

But it all started with understanding their target audience and their relationship with that audience. And that's a good reminder lesson for all of us in marketing!

Make new marketing tools part of your new business strategy.

Winning a new business assignment starts with understanding and responding to your prospect's needs. Clients are dealing with a laundry list of challenges – a struggling economy, new competition from all sides, a continued drive for lower costs, and a growing realization of the power that a connected consumer has over their business strategy and success. And many clients are simply overwhelmed by the new digital media options and how to use them to their advantage.

This creates a significant opportunity to redefine and expand the role agencies can play with their clients. Clients want new ideas to grow their business, but clients are not just saying to their agencies "how can you help us make ads or design a new web site?" They are also saying "how much do you understand about our business in order to help us build a bridge between our brand and our customers?"

Building bridges means understanding the category, the target audience and the company, but it also means understanding how to evaluate and use some of the new marketing tools that are available today. A key role that agencies can play is not only how to use these tools, but, more importantly, how they will impact a prospect's business.

For example, social media marketing is the number one topic in today's marketing press. But agencies should caution clients and prospects to think carefully before they jump in just because everyone else is doing it. Social media is a process, not an event. Agencies can help clients by focusing on how it can impact their business, not just on how to start a conversation using Facebook or Twitter.

The shift from traditional media to online and other new media alternatives is accelerating. But many marketers presume that the rise in on-demand media consumption and lower entry costs make it s better option. Agencies can help clients by looking for new and better ways to analyze their ROI.

E-mail marketing continues to grow in importance, but many experts predict that consumer fatigue from mailboxes overloaded with too many unsolicited and irrelevant offers will force consumer shutdown and rejection. Agencies can help clients by showing how to take advantage of behavioral targeting and other analytic tools to deliver e-mail that is triggered by consumer actions, not their own promotion activity.

Word-of-mouth marketing has become more intentional as a primary marketing tool rather than just as a happenstance event. Agencies should be looking for recommended efforts to generate beneficial consumer conversations through viral marketing and other buzz marketing tactics. At the same time, agencies must caution marketers to be transparent and honest in their efforts, or they will face the wrath of a growing blogosphere.

There is no question that clients need help in understanding how their business can take advantage of new media alternatives. But the ultimate need is not just how to effectively use email, blogs, podcasts, mobile marketing, viral marketing, pay-per-click, user-generated content, Twitter, etc., but how to mix them with traditional media to create the most impact.

Clients need help in understanding how their target audience attitudes, needs and motivations are changing as they adapt to new economic and social conditions. The Internet doesn't just change how we communicate with each other. It is having a profound impact on our shopping and buying habits, as well as our understanding of the world around us and how we relate to each other. The more real insight and information you can provide the prospect for his unique business situation and needs, the better your chances to secure a new client assignment.

There are many other new marketing tools, but when all is said and done, you can't win new business on a regular basis without really smart strategic thinking. Agencies are in the business of selling ideas, first and foremost. And that's how you win new business.

Looking Ahead: How the Changing Social Landscape is Affecting Marketing

We know that technology continues to encroach on every aspect of modern life. Innovations like Bluetooth, social marketing, blogs and mobile marketing are no longer just being used by the young technorati; they are being used by almost everyone, regardless of age and technology comfort and are rapidly becoming a part of the mainstream of American life. The Blackberry is an essential business tool, regardless of your age. Snapfish allows me to share photos of my children and grandchildren with my 80+ year old mother in Tennessee. The recent iPhone introduction is another example of the mass appeal that new technology can generate.

Perhaps just as important for marketers is to recognize that changing social behaviors, attitudes and mores are also affecting marketing. Here are ten things I believe will have major impact on how we market in the future.

1. Corporate greed is not good. In a world of increasing corporate transparency, consumers will reject companies and their products if they do not live up to proper ethical standards. Marketers need to examine every aspect of their business, not just the boardroom. Not every brand is as strong as Nike, and able to withstand the negative publicity of child labor exploitation.

2. In a multiple-choice world, you must differentiate or die. Jack Trout was right on target when he said that in today’s ultra-competitive world there are so many choices that companies will be hard pressed to survive without a point of difference. The average supermarket has over 45,000 branded items. There are now over 3,000 brands of bottled water. Huh?

3. To blog or not to blog, that is the question. Social networking is a fact that cannot be ignored. But companies must be careful when using tools like blogs, vlogs and Podcasts or face the wrath of a networked audience that can love you one minute and hate you the next. Some forward-thinking companies have created a new executive position of Blog Monitor to be able to respond quickly to new issues as they arise, or to correct misinformation that can damage a company unfairly.

4. “Word of mouth” can no longer be a happenstance event but rather an important part of an integrated marketing program. In today’s world, “word of mouth” can travel around the world instantly via the web. Viral marketing efforts like the Subservient Chicken and Lonelygirl15 have gotten millions of exposures for little to no cost. Social marketing and Web 2.0 will impact your business, whether you want it to or not. The next wave of “word of mouth” will be user-generated reviews of everything from restaurants to shopping to hair salons. One disappointing entrée or a surly waiter has the potential to ruin a restaurant’s reputation. Is that scary, or what?

5. Video messaging still rules, it’s just the delivery methods that are changing. Everything we learned in marketing class about sight, sound and motion still holds true. It is unquestionably the most powerful way to inform and persuade. But the continued fragmentation and decline in viewership of traditional television is being replaced by on-line video. We can’t all afford to back something as ambitious as Bud TV, but keep a close watch on YouTube as the next mass medium. Politicians have certainly jumped on that bandwagon. Are you one of the 2 million plus viewers of Obama Girl?

6. It’s not easy being green. Kermit was right. But if you aren’t looking for ways to include some form of green marketing or sustainability (the next great marketing buzzword), then you will be left behind, choking on ethanol exhaust fumes. Wal-Mart is touting itself as the world's largest buyer of organic cotton, fair trade coffee, and energy-efficient light bulbs. Companies across America are looking for ways to “green” their products, their manufacturing, and their distribution processes. Let’s face it. When a slide show can win an Oscar, it must be real. Since the original Earth Day in 1967, marketing periodicals have been saying that green marketing was the next big thing. It wasn’t then. It is now. Better get with the program.

7. Go organic. Go natural. Go anything but artificial. Organic foods. Organic skin care. Organic pants. Organic pants??? That’s right. A recent TV spot for Wal-Mart featured an on-camera spokesperson talking about her new organic pajama pants. The idea behind this spot shows just how deeply rooted the organic movement has become. It’s all part of the get real, get healthy, and environmentally-conscious world of today, not tomorrow.

8. CRM are the three most important letters you should know. Customer relationship management should be part of every marketing plan. We have always known that it is more expensive to recruit new customers than it is to retain existing ones. With ever-increasing expectations, and lower tolerance levels, consumers are demanding instant gratification at every turn. Retailers like Nordstrom are a great example of the power of being customer-centric – they continue to prove that people will pay more for better service.

9. East or west, home is best. A global economy, mass production and outsourcing, are contributing to a growing backlash against imported products and services that are putting American workers out of business. Many consumers are willing to pay more to get local goods that are presumably made with more care. With the recent product contamination scares from China, we may even see a resurgence of Made in America.

10. The era of “one size fits all” marketing is over, and niche marketing is the future of our business. If you haven’t read The Long Tail by Chris Anderson, buy it today. It’s one of the most thought-provoking books I have read in a long time. It makes a strong case for an entirely new economic model for business that is being created through digital technology. The Internet opens a new world of possibilities for niche products that never existed before and the primary economic value of the Internet to consumers comes from providing access to products that might never have been made available in a mass market economy. In a digital world where everything is available to everyone, niche marketing is the natural and inevitable wave of the future.

I’m sure you can find many other issues, trends, and social behaviors in your own business categories. The important thing to remember is to keep looking ahead if you don’t want to get left behind.