I had the opportunity earlier this week to attend a talk that Chip Heath, co-author of Made to Stick: Why Some Ideas Survive and Others Die, gave to a room full of B2B marketers on what makes marketing sticky. (Hint: The answer wasn’t a bigger budget or better PR.)
According to Heath, there are six principles for making marketing messages stick in the minds of customers, prospects, and other influencers:
Simplicity
Unexpectedness
Concreteness
Credibility
Ability to evoke an emotional response
Story format
Obviously, there are a few big challenges here for services marketers. For starters, services are intangible and therefore hard to describe in concrete terms. Services offerings are also complex and therefore difficult to explain in simple words and phrases. And IT marketers get a very bad rap when it comes to making credible claims. (Eighty-one percent of the CIOs surveyed by the CIO Executive Council in the spring of 2006 said that technology vendors either overstate or wildly overstate their capabilities.)
All of this is to say that most of us (myself included) could learn a thing or two from Chip. Luckily for us, he’ll be delivering the keynote address at ITSMA’s Annual Marketing Conference in Boston on November 14 and 15—and attendees will even get a free copy of his book.
So join us in November to learn more about the six principles of stickiness. I guarantee that Chip Heath won’t disappoint!
For many people, the lure of social networks like MySpace, Facebook,
and LinkedIn is the opportunity to express their individuality and creativity.
The same holds true for all the social media tools emerging on the Web,
from the avatars of Second Life to the mindless chatter of Twitter. People
are drawn to the opportunity to personalize their online appearance and
experience, and the bigger the crowd, the more people long to stand out.
This motivation should not be lost on B2B marketers. As customers—especially
younger ones—come to expect rich and personalized online experiences in
their leisure hours, they will expect it of their services and solutions
providers as well. Findings from ITSMA’s recent survey, How
Customers Choose, demonstrate that personalization is a factor
in the degree to which customers value the emerging digital media offerings
from their B2B providers. Though many of these tools are crude and experience
and expertise in deploying some of them are limited, marketers who don’t
personalize their marketing will miss out on an opportunity to reach customers
more directly—and with lower costs—than more traditional marketing vehicles
offer.
How Personalization Plays into Loyalty
Perhaps the clearest evidence of customers’ hunger for more personalized
information from providers is their clear rejection of traditional, undifferentiated
one-to-many communications. Of the 346 technology buyers surveyed by ITSMA,
83% said they no longer read unsolicited e-mail. Okay, so maybe that’s
not very surprising. But here’s where personalization plays into the picture:
Asked if they would read unsolicited marketing materials that contain
ideas that might be relevant to their businesses, such as success stories,
research reports, and Webinar invitations, 75% said they would.
Now, here’s the interesting (and in some ways scary) part: Asked if they
would pay attention to these marketing materials even if they were from
solution providers they had not previously done business with, a whopping
92% said they’d take a look. Think you can take your loyal customers for
granted by giving them generic marketing campaigns? Think again.
Of course, this means marketing must work harder than ever to maintain
customer loyalty. And the more personalized that content is, the better—especially
when it comes to digital content. When we asked respondents to rate the
value of digital supplier-sponsored programs, they ranked them as follows,
from most valuable to least valuable:
Dedicated client extranets
Social networking
Blogging
Of the three, extranets clearly have the best possibilities for personalization,
given the nascent state of social networking technology and the one-to-many
positioning of most corporate blogs. But that said, digital personalization
technologies have not yet developed to their full potential, and exposure
to them is relatively low. (For example, 74% of respondents participate
in executive-level business events, whereas only 16% have their own provider-supplied
extranets.) In part, that’s because providers aren’t up to speed on the
technology. Indeed, in a recent survey by McKinsey, only 36% of 410 respondents
from provider companies said they were using digital tools or techniques
as part of their sales management or advertising marketing programs. And
41% said they had insufficient internal capabilities to handle digital
marketing programs.
This should not be construed as a lack of interest on the part of marketers
in taking their digital marketing to a higher level. A recent survey by
analyst company Aberdeen Group found that 64% of nearly 300 respondents
plan to deliver personalized content and products to specific market segments.
Evolving Beyond Email
Today, email is the dominant channel for delivering personalized digital
marketing strategies, mostly because it’s relatively simple to automate
the campaigns. But personalized Websites (a.k.a. microsites) and customized
landing pages for customers—both of which have much more potential to
build and maintain customer relationships—are gaining momentum. They are
held back by the relative lack of tools for automating the process, though
such tools are becoming available.
Building in-depth user profiles is critically important to building a
valuable microsite or relevant landing page. These profiles should include
such information as pages visited, past purchases, sales relationships,
and service interactions. But marketers need to remember that it’s as
important to get content to visitors based on what they do when they get
to the site as it is to track their past history. Their goals for their
next visit may have little or nothing to do with the information they
sought the last time around. For example, a visitor might be seeking information
on computer printers during one visit and networking services the next
time. Filling the screen with suggested links to printers during the second
visit won’t make the experience seem more personal.
Automated personalization has a long way to go: Just 17% of the Aberdeen
respondents are able to change Website content dynamically in response
to the real-time actions of a visitor. And there are security and privacy
concerns; 39% of the Aberdeen respondents cited them as a roadblock. But
an effective response to those concerns is to give customers more control
over their profile—the kind of personalization they enjoy on Facebook
and LinkedIn.
It’s important to begin experimenting with online personalization, because
one day, online interactions are going to approach the kind of intimacy
and value of in-person executive meetings—at a fraction of the cost. But
even today, customers are increasingly looking to the Web to make their
purchasing decisions, and when they do, you need to make sure they find
exactly what they are looking for.
New
Thinking
"We" Are Smarter Than "Me": An Interview with Barry Libert
We recently sat down with Barry Libert, CEO of Shared Insights, a
provider of community education, management, and services, and co-author
of We Are Smarter Than
Me, a new book on how communities are changing the face of business,
to talk about the unique way in which the book was written and why its
message is important to marketers today.
ITSMA: Barry, tell us about how you came up with the
idea to write a book on a wiki with more than 4,000 contributors.
Libert: Shared Insights started building communities for clients
back in 2001, so we’re firm believers in the wisdom of crowds. A few years
later, we partnered up with Wharton, MIT, and Pearson to tap into their
communities to write about how employee and customer communities are beginning
to impact traditional business processes.
ITSMA: Sounds like it was a real case of practicing
what you preach. Logistically, how did it work? How did you get the community’s
input and make something meaningful out of it?
Libert: We invited over a million students, faculty, and alumni
from Wharton, MIT, and a few other places to participate in our wiki-based
community. Of those million people, 4,375 registered as members of the
community, where we asked them to share their insights about why community
approaches work or don't work when it comes to marketing, business development,
distribution, etc. We also asked them what companies have to do to make
communities work better. People not only contributed content, they also
provided their opinions on how we should structure the book and organize
the chapters.
We’d anticipated that most of the submissions would come through the
book wiki, but in the end we got a ton of content from the discussion
forums, podcasts, blog posts, emails, and in-person comments. Narrowing
thousands of pages down into a digestible book-length manuscript was very
difficult, and we actually brought in professional writers to help us
do that.
We ended up organizing the book around basic business functions such
as sales, marketing, and product development and included case study examples
of companies that are outsourcing some of their capabilities in these
areas not to India or China, but to communities of people, such as customers,
who have a vested interest in them.
ITSMA: What benefits of leveraging communities did your
book community identify?
Libert: Communities can be very helpful during the offer development
process. For example, Dell IdeaStorm is a community site that helps Dell
gauge which ideas are most important and most relevant to the public.
By engaging with a community, companies can "open source" the
design of their offers and ensure that they’re giving their customers
exactly what they want. For marketers, customer communities obviously
hold tremendous potential in terms of word of mouth, recommendations,
and referrals.
ITSMA: Community-based marketing is still quite new.
What new skills will marketers need to possess as communities gain more
importance within the business world?
Libert: The first thing they need is a new mindset. Historically,
marketing has been about creating and broadcasting messages to customers
and prospects. Communities change all that, because they turn the customers
into the marketers. In the future, marketers will need to be facilitators.
They’ll have to get used to letting customers design and deliver the company’s
messages. It’s a very different mindset than marketers currently have.
ITSMA: How are you planning on marketing and promoting
the book?
Libert: We’ll be marketing the book through the community that
created it. Pre-orders are just starting to ship this week, and the book
will hit stores in mid-October, so the journey has just begun. But our
community is already blogging and podcasting about it, we’re doing some
interesting things in Facebook, and we’re planning on using interactive
media, virtual roundtables, "unconferences," and so forth to
generate interest and spread the word.
The midsize business segment of the IT industry is growing faster than
any other segment, but Avaya’s share of the market declined from 2002
to 2004. In response, the company created a Midsize Business Focus team led by Kevin Cook, Avaya’s vice president of North American Sales, to assess the right solutions for the midsize market, the right focus on the sales channel, and the proper organizational structure to support long-term sales success. This cross-functional team embarked on a multi-year, multi-step initiative to accomplish a wholesale change in how Avaya approached the midsize market.
Step One: Understand the Issues
Cook’s team knew that before they could implement change, they needed
to understand why Avaya’s share of the midsize market was not on target
with the company’s expectations. As they performed extensive research
with both customers and channel partners, it became clear that gaps in
Avaya’s solutions portfolio needed to be filled with value propositions
that were the right fit for the midsize market.
Utilizing research completed by Avaya’s corporate marketing group, it
became clear to the team that the midsize market needed to be segmented
further into three sub segments:
Basic communicators
Mainstream communicators
Strategic communicators
Interviews with Avaya resellers revealed that channel partners were comfortable
selling Avaya’s solutions to the strategic sub segment of the midsize
market, but didn’t feel that Avaya had the right offers for the basic
and mainstream groups.
One of the short-term, stop-gap initiatives that the company implemented
immediately was the Takeshare Program, a promotional pricing initiative
that allowed Avaya to aggressively improve market position and test the
input they were receiving from their channel partners—information that
proved to be critical. The company attributes the success of this program
to clear, honest, and focused communication with and from its channel
partners.
To achieve a high level of valuable information, training its Avaya channel
account managers was particularly critical. The managers were trained
to discuss what Avaya’s position was in the midmarket, the company’s long
term plans for change, and how the partners could use the program to win
in deals where they typically could not compete. To ensure a clear and
consistent message, Avaya’s channel account managers met with each of
their partners to review the program, including specific examples of how
to use the program to their advantage in competing to win customers through
rebates and how to adjust pricing of existing Avaya offers to make them
more attractive to basic and mainstream communicators within the midsize
market.
The Avaya team then executed an aggressive marketing campaign around
the TakeShare Program. The campaign was designed to inform Avaya’s channel
partners of the company’s current position in the midsize segment and
train Avaya resellers to pursue midsize opportunities that they may not
have previously considered worthwhile.
Since its inception in early 2005, the TakeShare Program has driven in
more than $150 million in incremental revenue.
Step Two: Build Midsize Solutions
Despite the success of the TakeShare Program, Cook’s team knew that,
in the long run, they needed to create a portfolio of offerings that were
built specifically for the midsize market, especially in the mainstream
communicators segment. To meet the needs of this particular market, Avaya’s
solution needed to have the right level of sophistication, but not the
complexity that a small staff of IT personnel at a midsize company might
find difficult to manage. It needed to be easy for the channel to sell
it, and easy for customers to purchase and use it.
Again, Avaya called on its community of certified resellers for input.
The result was MultiVantage® Express, a solution that integrates the company’s
call processing software and Avaya Communication Manager, along with applications
such as conferencing, messaging, mobility, and call center. It’s very
easy to design—the purchaser only has to answer how many and what type
of phones they desire—and all the applications are integrated into one
server to reduce the maintenance cost and effort. Furthermore, implementing
MultiVantage Express isn’t nearly as difficult or time-consuming as implementing
an enterprise-level solution.
Avaya knew that properly marketing to the midsize segment was essential
to success. To that end, it created a Website specifically for the midsize
business customer, as well as a midsize-focused section on Avaya’s channel
portal. The sites contain information, white papers, and demos. Channel
partners can also find appropriate midsize reference customers and a Small
and Midsize Positioning Guide, which helps them determine if a prospect’s
company is a basic, mainstream, or strategic communicator and also helps
them identify the most relevant Avaya offering.
Due in large part to the creation of the TakeShare program and MultiVantage
Express, line shipments of Avaya’s midsize portfolio grew 17 percent from
2005 to 2006.
Step Three: Organize for Growth
To ensure that its focus on the midsize market remains sharp, Avaya created
the Midmarket Solution team, with focused responsibility for this segment.
The team’s responsibility includes end-to-end global solutions targeted
at this growing and competitively-contested customer segment, including
coordinating packaging, pricing, positioning, requirements, and go-to-market
for the midmarket portfolio components.
In April 2007, the solution team’s efforts bore fruit, with the launch
of two new applications:
Avaya Customer Interaction Express, a customer contact application
designed for midsize call centers of 20 to 100 agents.
Avaya Meeting Exchange Express, a mid-level conferencing and collaboration
offering that provides industry-standard conferencing.
Avaya’s three-pronged approach to addressing the midsize market has been
very successful, with a significant increase in its midsize revenues.
"One of the best things about the experience," said Jeff Koehler,
Avaya Midmarket Channel Director, "is that we’ve reinforced our belief
in listening closely to our channel partners. Partner input through the
entire solution development process was vital to ensuring that these offerings
speak to the market and meet customer needs, and we’ll continue to engage
with our partners as we move forward with this critical market segment."
Research Desk
Ask ITSMA: How Can We Grow Our Support Services Business?
Each month, ITSMA receives a number of queries through Ask ITSMA, a resource designed to give members a quick and easy way to get insight on important services and solutions marketing questions they face. In this column, we will publish some of our favorite questions along with excerpts from our replies.
Question: Although my company’s support services business is profitable today, customer buying behavior is changing and we’re worried about sustaining profitability and growth into the future. What can we do to ensure continued growth?
Answer: It’s true that customer behavior is changing. Recent ITSMA research shows that customers are increasingly asking for lower pricing, moving to online and peer support models, opting for SaaS, and even questioning the need for support altogether. In this environment, providers do need to think about what they can do to "future proof" their support businesses.
We have five recommendations for companies that are looking to ensure continued growth:
Make services easy to buy and even easier to sell. Labyrinthine services portfolios are confusing for customers and salespeople alike. Simplify the portfolio and arm the sales force with the tools they need to sell your services.
Make the portfolio more meaningful to customers. For example, Cisco has organized its portfolio by customer-centric dimensions instead of by the company’s delivery structure.
Segment and create services packages based on needs and interests—not just size and vertical industry. Companies like EMC and HP are creating new classes of services based on research and needs-based segmentation strategies.
Integrate support services with your solutions. Companies that have moved from providing product-level support to solutions-level support are experiencing positive results.
Reposition support services to go beyond traditional break-fix and help customers deal with their business issues. Avaya, Cisco, EMC, HP, Juniper, and others are making this critical shift to focus on business value, not just uptime insurance.
Do you have a services marketing question? Visit Ask ITSMA to access
our experience, insight, and research results.
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