The two hottest topics in marketing today are “Social Marketing” and “Marketing ROI.” In this paper, you will see how understanding the true nature of Social Marketing points to a methodology — Influence Mapping — that provides marketing managers with a means to optimize their Marketing ROI.
It is impossible today to have a conversation about marketing without including the social side of things: networking, Facebook, Linked-In, blogs, Twitter, podcasts, and more. These are powerful tools that, as part of an integrated campaign, can help deliver marketing’s message. Social Marketing has impacted virtually all aspects of marketing and allowed new and different messaging and positioning; it is part of most marketing campaigns. According to many social marketers, “Print-based marketing is dead; long live the web!”
The problem is not with Social Marketing (or social marketers): it is with those who equate “Social Marketing” to Marketing.” Social Marketing is a means to an end; Marketing defines that end. Social is a tool to reach targets; Marketing defines the target and their values. Social is a tactic; Marketing is a strategy.
Though many of last century’s basic Marketing 101’s tools are still valid and usable today, their application is hugely different than it was a mere ten or fifteen years ago:
All of this and more is driven by the fact that power has shifted from the manufacturer (in the mid-1900s) to the advertiser (late 1900s) to the customer (21st century); we’re not finished. Do you sometimes wonder how we did business without the Internet (now 25 years old) or smartphones (now 15 years old)? In another 5 years, we will look back at today and wonder how we survived without_____________________ . Marketers no longer can dictate their positioning to customers; they can only suggest it — if it’s heard at all.
The problem is clutter. Target customers are swimming (drowning?) in information; they can pick and choose what and who they want to listen to. They form their own opinions based on a mix of what marketing says, what their peers say, and (gasp!) what they think individually. Influence has shifted away from classic advertising/PR-based tactics and towards more social, self-forming networks. So, if’ Social Marketing’ is the answer, it’s up to classical marketing to determine what the right question is.
Traditionally, marketing has focused on the Decision Maker (DM); the person who could say “yes” or “no” to buying something. Marketing used segmentation to identify and describe targets (using demographics, psychographics, and behavioral), then used the Marketing Mix (price, product, place, and promotion) to communicate to them. Virtually all of the marketing was focused on two fundamental goals:
Is it not obvious that marketing’s ability to reach and impact the DM has greatly diminished, perhaps to unsustainable levels? Marketing can no longer control — or even have much influence on — where DMs go for information or what they do with it. Customers shop as they choose where they want to; seek input from whatever sources they value; decide what to believe and reject on their own; they are more autonomous than ever (and it’s a growing trend). In other words, classic marketing’s influence on the DM is greatly diluted, and it is diminishing more every day.
Enter the realm of the Decision Influencer (DI) … and welcome to 21st-century marketing! Let’s start by defining some common terms in today’s marketing environment:
Decision Used in a marketing context, decision used to be synonymous with ‘Purchase’ or ‘Buy’; it was a singular event, the end of a successful marketing/sales campaign. We now know that the ultimate decision to buy something is predicted by many other pre-purchase decisions: what information to use; where to shop and where to buy (two separate decisions); what solutions to consider; the competitive landscape, and more. “Decision” has been replaced by “buy process,” and contemporary marketing needs to have an impact on — to influence — each step of the buying process to optimize the final outcomes. Put another way, marketing must now embrace the target customer’s entire shopping process, not just the point of sale.
Decision Maker Every purchase decision (but not necessarily those predicting it) is made by a human being. Segments, companies, and demographics do not buy, people do: b2b or b2c, it’s always a person who makes die ultimate decision to buy. [The only real exception to this is government procurement, where legal formulas may trump human decision making.]
Pro-purchase decisions, however, can be more arbitrary or systematic (as all salespeople know quite well). For example: in the business world, a vendor often must be on the “Approved Vendor List” before purchasing can buy anything horn them. If the Quality group (that often controls this list) is too busy to add a new vendor, then the ultimate buying ’decision’ has been made by Quality’s workload
Also, note that Decision Maker’ is a singular term: though there are often multiple people involved in reaching a final purchase decision (see Decision Influence™ below), in the vast majority of situations a single person makes each decision.
Decision Influencers Each DM is impacted by a multitude of influencers from near and far. There are two types of influences: people and things, and they can be either internal or external to the DWs unit (family for b2c, company or division for b2b). Thus, there are four types of DIs impacting every DM; some examples of Decision Influences can be seen in the table below.
To summarize: the buying process has become far more complex and longer. DM1s are harder to roach, and there are far more influence points with greater impact than ever before. Combined with constraints cm marketing budgets and the demand for ROI justification of any new initiative, it is dear that marketing as it used to be won’t work any longer.
More and more, marketing’s task is shifting from directly reaching the DM to influencing the DIs, How to do that cost-effectively, with little or no budget increase, is perhaps the most daunting challenge that marketing has faced.
Fundamentally, Social Marketing is getting others — friends, family, thought Leaden, etc, — to influence target DMs. It is a tactic, however, that needs to be part of an over-arching strategy. It is a tactic, however, that needs to be part of an over-arching strategy. Is Social an efficient and effective means of reaching defined target DMs? Social marketing includes everything from posting an article on the AARP website to having a Facebook page and more; which is right for a given situation? How much resource should you put into the effort? How do you measure the results (and what should the metrics be)?
In short, what’s the question that marketing is trying to answer?
Traditionally, marketing has sought to directly influence the DM through ads, PR, shows, placements, branding, and all the other tools marketing uses. But it’s too noisy for that to work as well as it used to; people have access to far more information than they used to; DMs value the inputs from peers and opinion leaders far more than what the producers say. So, the contemporary question for marketing is: How does marketing efficiently reach and influence die DIs?
Marketing’s world has changed forever, and organizations that ignore it do so at their peril… and possible demise. Consider the changes in scope when marketing’s target changes from reaching the DM to reaching and impacting all the DIs:
1 While this might be a more accurate name for today’s marketing function we are not suggesting that anyone really make this change.
The range of DIs on a DM regarding any decision can be huge and diverse, yet ignoring any of them may dramatically reduce your chances of success. Which would you rather be:
Beyond knowing the DM, marketing must learn who and what influences the DM in their decision making. Learning how to influence the influences is the next big thing for marketing.
Influence Mapping is a process for coordinating and optimizing your efforts to influence the influences. Specifically, it helps you:
Influence Mapping is comprehensive in that it covers multiple aspects of an organization’s marketing/promotion efforts (channel, PR, trade shows, advertising, online, corporate communications, etc.), yet highly focused in that it looks at micro-segments of (or even individual) DMs and how to have an on impact their decision.
Since an organization’s influence on a DM is spread across many functional groups (sales, marketing, brand, etc.), a successful Influence Mapping effort requires input from each of these groups. Fundamentally, the process works as follows:
2 Focusing on the right DM is critical to the success of any Influence Mapping exercise; there are some ‘rules’ about selecting and defining the target DM that help:
Influence Mapping can be applied in many different situations such as:
Finally, Influence Mapping works from a totally customer-centric (rather than product- centric) perspective. Marketing today is not about products; it’s all about delivering more value to your customer than your competition does. Consider the facts mentioned earlier in this paper:
Unless there is a breakthrough in how to read people’s minds and quantitatively analyze them, ROI will never be as precise for marketing as it is for operations or product development. In those disciplines, you can measure the precise inputs required and the results those inputs produce; varying one input (production capacity, for example) directly and specifically drives an output (units produced).
In marketing we deal with human actions; the line between an ad (input) and revenue (output) is imprecise at best. How can you measure the specific impact on brand perception of any one specific ad?
A slight paradigm shift is all that is needed: Operational ROI is quantitative in nature, while Marketing ROI is more qualitative. By viewing the return on an individual marketing investment relative to other possible marketing investments we can learn what has better or lesser outcomes — and that leads to optimizing the allocation of resources.
There is another fundamental difference Marketing ROI faces. In most other disciplines,
ROI involves choosing which incremental investment to make; in marketing, it often involves doing less of something so that you can do more of something else. It’s more about shifting resources than merely adding new ones. A good way to view this is to consider Marketing ROI as Relative ROI: you are comparing the efficacy of one action to another rather than calculating the precise impact it will have.
The primary result of Influence Mapping is a list of marketing’s activities in descending order of their efficacy. It clearly shows what to do more of and what to do less of; it is a strategic roadmap that a marketing manager simply should not live without.
If you’d like more information about how to apply a process to improve your marketing/sales function, simply contact us and we’d be happy to help you get started. From sweeping marketing/sales management process strategies to specific branding or product launch services, Customer Manufacturing Group can help.
If you’d like to learn more about Customer Manufacturing Group, or for a complimentary subscription to Customer Manufacturing Updates, give us a call at (800) 947-0140, fax us at (408) 727-3949, visit our website at www.customermanufacturing.com, or e-mail us at firstname.lastname@example.org.
We have offices in major cities in the United States, and our experts travel extensively throughout the world. If you’d like to schedule a meeting when we’re in your area, just let us know.