When Targeting Turns to Blasting: Answers
Marketing Challenge: When Targeting Turns to Blasting
Recap: Kate Rodgin needed to promote a new product and get adoption—fast. She started by analyzing Daymore Products' customer list to find the right customers for the new product. Then she created two targeted lists, messaging that would resonate, and a multichannel outreach plan. Unfortunately, the product uptake was nil, so Rodgin widened the list of email recipients and included more generic messaging, but still, the needle barely moved.
Then Rodgin blasted the whole customer list and included a discount for trying the product. Each email outreach garnered a small response, and an even smaller percentage of purchases. Rodgin was feeling desperate. She had numbers to hit.
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July winner: Paul Bennett, senior sales executive, AgilOne Inc.
Rodgin's response to her campaign's lackluster performance reminded me of an old golf saying: When you get in trouble, make sure your next shot gets you out of trouble. Unfortunately, by getting less targeted in her second mailing, and then by hitting the discount panic button in the third, Kate managed to chunk it from the long rough into the pond.
I would advise Rodgin to do the following:
1. Reexamine the product-to-product assumptions that support her targeting strategy. Starting with “customers who had purchased similar or complementary products” isn't necessarily wrong, but the initial response clearly suggests that something didn't click. With a new product introduction, it's possible that her target lists might have been focused on exactly the wrong customers. Testing other category buyers and analyzing the small set of converters the campaign brought in might point them in a different direction.
2. Incorporate behavioral email segmentation into her targeting. Perhaps Rodgin actually targeted customer segments with historically low email engagement. She could instead increase selection of more engaged customers, encouraging them to spread the word on the new product through social channels and revising headlines and content to speak more relevantly to the enthusiasts who regularly open and click through Daymore communications.
3. Don't assume that all customers are motivated by discount. It's fair to assume that Rodgin is reluctant to share the poor campaign performance data with her boss—wait until she calculates the margin she threw out the window by giving discounts to high-value segments that are typically full-price buyers. Going forward, she needs to better understand segment-level price elasticity and tailor offer strategies accordingly.
Increasing Daymore's analytic IQ, rather than hitting “send” in the face of campaign challenges, should help turn things around.
John Hennessy, SVP, Mobeam
Based on the scenario, I assume that the initial targeting was thoughtful and probably pretty good. That leaves the messaging and call to action.
Since there is no mention of a testing step, I also assume the copy wasn't sufficient to generate interest and wasn't tested to improve its effectiveness. Since there is no mention of the audience response to the call to action, I assume, again, that there is no call-to-action in the messaging. The “just send it and they will come” approach does not deliver results.
While companies are always in selling mode, prospects need to be activated. But what activates a prospect changes, which is why we need message testing.
Also, what the marketing team thinks it's selling might not be what the customer is looking to buy. A good testing process will reveal this disconnect and help [reframe] the message. The formula is the right audience, the right copy, and the right call-to-action. The correct answer to the question, “Which is most important?” is, all of them. A failure in any one destroys success in the other two.
I would advise a strong, valuable call-to-action and testing both the call-to-action and the copy with small subsets of the target groups in advance of any large mailing. As the scenario demonstrates, poor execution done quickly does not make up for gradual execution done correctly.
Mike Dukes, account representative, Rubinstein's Office Supplies
Rodgin seems well within her expertise when it comes to audience selection. She selected what was a natural audience and even created an additional test segment that would allow for additional potential. Unfortunately, her driving force for “needing adoption” is rarely a formula for success.
The new product clearly lacked appeal. Rodgin then compounded her problem by blasting her entire file before attempting to resolve the issues with the new product. She has now totally exposed the product and has little chance to change the offer or reposition the product. In addition to audience selection,
Rodgin should have focused on why this product would sell and make sure that it was given every opportunity to succeed.
Chris Marentis, CEO and founder, Surefire Social
Before creating a list of target customers based on similar purchasing habits, Daymore could have conducted a pay-per-click campaign incorporating the new product's value proposition to gauge interest from prospects. The response rate and metrics would have helped define and confirm the target buyers. Additionally, Daymore could have used a multichannel marketing approach using other vehicles. This includes social media marketing like Facebook–promoted posts and PPC options like SEM, pay per call, and affiliate marketing. Using these channels could have driven traffic to Daymore's website, once the target had been defined.
Michael Smith, marketing designer, Tri-Win Direct
It sounds like the marketing approach simply doesn't speak to the target audience, but you never know until you test.
You know the customers on your list buy complementary products and they buy from you, so getting them to try a new product after offering an incentive should be simple. In this case three promotions sent to (what should be) a golden list has fizzled. It's time to rethink the creative.
Rodgin needs to return to the marketing director and start talking about an A/B marketing approach. Create two more campaigns based around different benefits and offers, and then split the lists. Track the results and see which one works gets a better response. Take that data, adapt the winning creative and do it again. It may not be the slam dunk Rodgin thought she was going to get, but it's a much better idea than a desperate email blast.
Carlos Miranda Durand, Revenue Science Fellow, FedEx
Here is my advice for Rodgin:
1. Look among non-customers. Your new product may help expand Daymore's customer base if you follow a similar analytical process (e.g. modeling customers who purchased similar products in the past) and focus the search for lookalikes among customers who have not purchased from your firm yet. Use external sources and also consider purchasing mailing lists that contain the customer profile that you are targeting.
2. Better understand the value of the new product for your customers. The features of the new product compared to your old products may not be different enough or valuable enough to warrant the new price or to justify the cost of an upgrade from the customer's perspective. Research what benefits your target customers gain from the new product, if they understood these benefits during the marketing campaign, how satisfied they are with the old product, how long the old product lasts in their process, and if the brand carries value with customers.
3. Monitor the competition. The competitive landscape can evolve quickly and another firm may have launched a similar (or better) product recently. If that proves to be the case, consider options like improving your new product's features or pricing it adequately based on the differentiation value that each one provides to the customer. If you have competitive advantages, include them in your promotional messaging to the relevant segments. Try to avoid discounting your product unless you know that it will lead to higher profits after customer and competitor responses are accounted for.
John Halliburton, British Parts
Rodgin needs to identify and isolate the problem(s). She should go back to the beginning and chat with the product manager and product development team, then reexamine the product/market research data to ensure they didn't miscalculate market potential and consumer demand. Evaluate and progress through their processes until she discovers the disconnect. I realize it's hard to believe, but even marketing and advertising geniuses can't fix stupid.
Erik Gupp, digital specialist, Bridgeline Digital
The problem with email marketing is that it is not an exact science. There's no formula that guarantees marketers a successful campaign; the same steps you took in a previous email that earned great results won't necessarily track in ensuing efforts.
Given that we don't know what type of product Rodgin is marketing, it's hard to determine a specific strategy for her to implement. The Marketing Challenge does not address whether purchase of the product is limited to online channels, or can also be found in a retail outlet. Other pertinent questions include whether the product is a retail good targeted at a wide mass of consumers, or if it is a high-value technical product that has a much smaller audience.
Putting those questions aside for a moment, Kate had a (seemingly) well-planned campaign ready to execute. Initially, she correctly identified a target audience and built an expansive multichannel outreach plan. However, let's examine where her efforts may have fallen short.
Typically new product adoption means you need to really sell the benefits of what makes your product better than others available from competitor products. This means developing a strategy comprising not only emails and postcards, but also sending samples, holding demos, purchasing radio ads, planning social media campaigns (e.g., Facebook and Twitter posts), or even sending the product to third-party bloggers related to the industry to generate buzz. These are all examples of strategies that gain significant product awareness out in the marketplace. Consequently, when the recipient receives an email or postcard, they may be more inclined to click through to your website and make a purchase.
Another place to look for improvements is in evaluating the metrics of Kate's email campaign. This involves taking a deep-dive approach in to the data, and looking at elements like open rates and click-through rates. If the open rates are substandard, she should look at the subject line and ask germane questions like:
- Is it too long? Numerous studies show that subject lines of 50 characters or less generate a higher open rate.
- What about the vocabulary? Action-oriented verbs grab a reader's attention and drive desired outcomes.
Kate then should examine what's being displayed above the fold. Statistics have shown that email readers spend approximately 5 seconds scanning an email before they close the message. Even though your distribution list is targeted, if the content isn't engaging or the messaging is too broad/hidden, then you will not see the results you want. In this case, the email was not effective, thus redesigning the email template to better highlight the product is advised. Here are a few questions she should consider:
- Is the image or call-to-action (CTA) effective? This is the driving force behind an email campaign. If the recipient doesn't see or understand the CTA, the entire campaign is in jeopardy. Determining how well it resonates with readers cannot be understated in terms of email success.
- What hyperlinks/thumbnails are grabbing user's attention? Understanding which links in the email copy are working and which are not will go a long way in assisting future campaigns.
My last suggestion to Kate is to not saturate the distribution lists with too many emails. In the digital world we live in, the average person gets hundreds of emails every day. It is simple for a user to ignore an email or chose to unsubscribe if they feel you are over-communicating to them. Lower open rates typically happen when emails from businesses come too frequently or contain messaging that is too broad. By using these areas of improvement, I think Kate will be able to see a better return on both this email campaign and future efforts.