Suites, Demos and Hope

Marketing automation these days is part of a suite; a tag along if you like, an inclusion to a broader CRM suite.  This phenomenon has created a really interesting change in the buying process.

It generally means that marketers don’t choose the Marketing Automation solution,  they are left to convince themselves of a choice made elsewhere.  That’s why demos have become important, they make people feel better about their (lack of) options. Detailed requirements for marketing automation have become a thing of the past, it’s pretty common now for Marketing Automation solutions to be chosen without any detailed functional requirements analysis.

It’s easy to be seduced by a demo.  Software vendors excel at producing demo’s that make you go weak at the knees.  In many cases, software is designed from the demo backwards.  Real-world data looks nothing like demo data and all of those little nuances in your real-world data will quickly render the demo you saw into a mirage.

COVID 19 – selecting platforms based on a number of curated use cases (abandoned cart retargeting) is very different from selecting based on functional requirements (be able to build a campaign using web traffic data and offline purchase history).  One will prepare you specifically for what you know, the other will define a capability that can be used to create campaigns in a broad range of yet to be known situations.  Communicating to customers in a pandemic was not on anyone’s use case list 2 months ago.

Rise of the MVP. Fall of Marketing at Scale

Generally, I like the idea of building a Minimum Viable Product (MVP), it cuts through the noise of ‘nice to haves’ and subjective opinions on the fringe.  However, when the MVP is a welcome

email and a birthday campaign, it’s more a Minimum Possible Product (MPP) than a Minimum Viable Product.  There is a reason why vendors convince clients to go with an MVP (MPP).

Implementations are generally sold on limited implementation budgets, that’s part of the sale proposition.  “We’ll get you to MVP, train you how to use the product  and presto, you’ll be able to build out the rest yourself ”. It’s at this point that reality begins to unhinge from the sales process.  After the implementation team has left the MVP behind, you found out that its an order of magnitude more difficult to get your shiny new solution to scale and build real world campaigns.  Often, to get anywhere close to what you previously had or what was promised in the sales pitch requires a string of workarounds, custom code and hacks.  All of this gets the job done in the short term but doesn’t bode well for future scalability as the spaghetti code and hacks unravel under pressure.

COVID-19 emphasises the need to be able to respond to situations quickly. Hack, workarounds and custom codes are often not quick enough and if they are, they’re risky.  A crisis may well redefine your definition of an MVP.

Obsession with Digital –  The 10% Solution

Digital transformation is in vogue as a way for organisations to reduce cost, simplify the process and deliver a better experience for customers. Digitalisation of processes can create big wins in terms of cost reduction and simplification but from a marketing perspective, most of the interesting data is outside of the new digital platforms.  If you’re a telecommunications company, it’s the call and data packet records, if you’re retailer, it’s the in-store purchases and if you’re a bank, most of the credit card purchases.  This will change over time as more transactions move to digital platforms but for now, it is what it is.  That means  70%+ of transactions (customer interactions) are occurring in the offline world.  Why is this a problem?  Well, it’s a problem because software vendors sell their products on digital use cases, abandoned cart, browse but no purchase, retargeting, Facebook integration etc etc etc. 

I’m not saying these things are not important, but the reality is…they’re a small part of where the marketing opportunity is today.  Most of the value is still in offline systems like the POS or the call records, or the credit card transactions and this data is voluminous, complex and unclean.  If you are not getting into this data from your marketing automation system in a usable way then your marketing automation solution is going to do a brilliant job of solving 10% of your problem.

COVID 19 is surely going to nudge the migration to digital so maybe it will be a 20% solution.

The Illusion of Automation

Question: Why do you need to automate anyway?  

Answer: Because creating relevant marketing requires you to get three things right: the target, the timing and the message.  We’ll leave the  message out for now because that’s a whole topic on its own.  Let’s just look at targeting and timing – getting targeting right means targeting smaller groups of customers with each execution, sometimes 10’s of customers but typically low 1000’s.  Getting the timing right means executing at a minimum daily and ideally real time, even if you only contact customers on weekdays that’s 20 executions per month. 

Now, let’s say you are just working on your welcome/onboarding process. You’ve recently identified 15 marketable interactions in a welcome process; first transaction, no transaction after 5 days, 2nd to 3rd transaction reminder,  low purchase amount,  first reward redemption, coupon reminder etc etc.  Just this welcome process will generate 300 (15 campaigns x 20 times per month)  campaign executions per month.  So if you’re not executing a minimum of 1000 executions per month (welcome + cross sell + upsell + retention+ winback), then what does marketing automation mean to you?  We’ve seen many companies go from 1000’s of executions a month to 100’s when they migrate focusing on digital and MVP and never recover.

COVID 19 – your campaigns will keep running while everyone is running around sanitising their desk and trying to buy toilet paper.

Babies, Bathwater and Sewerage

Using data to create great marketing is hard. It’s worthwhile, it’s profitable and it’s valuable to customers but it’s hard.  It’s hard because making sense of the data is hard, the majority of the systems we use to collect data for marketing were designed for another purpose.  Pumping raw data into your marketing automation system is like pumping sewage into your bath.  The reality is, we’re all bathing in dinosaur pee but before we bathe in it, mother nature has kindly filtered it, processed it and cleaned it so when we open our mouths in the shower without fear of what we’re going to swallow.  The same is true of your data,  you can’t just expose your data lake to your marketing automation solution and expect it to taste great, it needs to be filtered, processed and cleaned.

by Regan Yan, the CEO of Digital Alchemy.

Regan is a subject-matter expert in analytical database marketing and customer relationship marketing, as well as an in-demand presenter and keynote speaker at national and international events. He also authors thought leadership pieces on data-driven marketing that can be found on the DA Blog.