Helping people understand why they need you

I recently met with a CPA to help his firm evaluate its marketing messaging. Up to this point his firm has been successful at generating revenue through reputation and word of mouth referrals. But now he is looking to grow his business and to get more aggressive with his marketing.

His firm goes beyond the traditional accounting model by offering full service IT integration and systems implementation. His model might be similar to Accenture except that his target market consists of far less sophisticated companies in the $1 to $50 million range. Those who have used his firm can attest to the value he offers. But in spite of his success with his current customers he still faced several challenges as he endeavored to grow the business.

Among them:

• How to communicate his "added" value to an audience that was used to looking at IT and Accounting separately.
• How do you begin to develop a marketing strategy when there is no one in your competitive space to benchmark against?
• How can you convince this market that your services are a necessary catalyst to growth and not a cumbersome cost?

Through the course of the exercise we tried to look at past examples where new services or products faced a market with seemingly unchanging and archaic views of what was available. Apple Computers, Netscape, and Nike were all examples of companies that revolutionized things by redefining the rules and perceptions of a given space. They didn't get bogged down in apples to apples comparisons with the competition, they focused getting to the heart of how their offerings could redefine the lives of those who used them. For example, in the early 1980's a write up on the computing power of a Tandy computer wouldn't have meant anything to the average American. But once you are able to convince them of why the PC was able to enhance our lives we witnessed a something that was game changing.

We took the same approach. We didn't want these unique services to be "cubby holed" in with the existing offerings by other CPA's or IT firms. This firm did all of those things but it also did so much more. We wanted to focus on the "Why" and not the "What". That led to the creation of some messaging that really resonated and communicated value to the intended market. Once we determined why this offering was a solution for what was plaguing the market the rest fell into place.

If you are trying to reshape a rather commoditized market or if you are trying to create demand for something new your messaging has to be spot on. You need to clearly define the added or new value to your audience. If you don't they will see no reason to change what they are doing irregardless of how much your offering may help.

All of my customers aren't all alike?

Here's a business story that a number of you might be familiar with. Hopefully it will motivate wholesale change with the manner in which you approach your customers.

Picture this.

A growing consumer products company has several successful products that are all the rage with homemakers who love to craft. These products potentially have other uses or customers but the housewives really love them and, as a result, become the fuel for this company's growth. All marketing efforts were devoted to this group, all consumers were considered similar, and all messaging was uniform. And the company continued to grow....in spite of this. Eventually demand leveled out and the company ceased to grow.

Is there a lesson here?

Rule #1 in marketing is "know thy customer". And if you have a halfway decent product or service that word customer likely has an "S" at the end of it. So let's make that "know thy customers." You likely have multiple customers and those multiple customers likely have unique tastes, buying habits, and preferences.

You know where this is leading....Market Segmentation. Since everyone has different reasons for using your products it is essential that you find an economical way to connect to those unique groups. In marketing parlance this is segmenting the market and there are several ways to do this ranging from simply interviewing several of your key customers to applying robust statistical analysis like CHAID to a large survey population. It is only common sense that, if your customers are different, that you adjust accordingly.

Some of the positive results of market segmentation include:

• More accurate sales forecasting which means improved resource planning.
• Increased revenue by focusing marketing efforts on the high demand customers.
• You better understand your markets and they will appreciate your willingness to get to know them.
• Cost savings when instead of marketing to the entire customer base you match messaging with the groups that will be the most likely to receive them.

Identifying and addressing the differences in your audience is Marketing 101. At the very least you need to have people within your organization who are familiar with the nuances of your marketplace. Ideally you have someone in your organization or you bring in a third party to help you identify these things. We recommend that perform several and regular activities to engage your customer base. This could be as simple as informal conversations at the point of purchase. And it can lead to performing an extensive survey of this same group to statistically distinguish between the groups. The internet has become a masterful place to engage with the customer and to determine their unique desires.

Go forth. Continue to sell your products. But do so smartly. Don't treat a Sally like a Fred. They may both buy your products but they are very different. It is your job to know those differences and provide incentives to ensure their loyal and profitable patronage.

A virtuous bank?

The travails of the current recession have had the thinking public looking for the source. While the list of culprits is long and varied the popular voice almost uniformly heaps the lions share of the blame on Wall Street and the financial sector. Whether or not this disdain is fully justified is a question for another day but the current actions- think AIG and Goldman Sachs bonuses- within this sector have only strengthened the anger.

But new forward thinking businesses are emerging out of the malaise created by the greed of the previous generation. Whether or not this latest iteration of businesses can succeed will probably depend on their ability to reign in the universal drive for excessive lucre. Among the companies leading this new charge is none other then organization from the oft hated Financial Sector, Spanish bank Caja Navarra. It is this bank and its unique business model, referred to as "Civic Banking", that I want to showcase.

Since 2000 this bank has been quietly and effectively turning a healthy and guilt free profit in Spain. Their motto, "Future financial institutions will be civic...or they won't survive" not only explains their Raison d'être it also serves notice to the other financial institutions that they are harvesting a new wind of change.

Picture this. I have a bank account and I receive a monthly statement that details my charges and what I've made in interest. Pretty standard stuff. Caja Navarra does this but they also will let you know exactly how much money they made off of you and they give you the ability to designate 30% of those profits to charity. So we now have increased visibility and incredible corporate responsibility.

The bank is now poised to enter the US Market. They have met with institutions such as Columbia, Wharton, and Thunderbird evangelizing their message of corporate responsibility. The way the public currently perceives the suits on Wall Street this type of move couldn't come soon enough. We need more organizations and corporations that think beyond themselves and, hopefully, this will inspire more of them to follow suit.

Thriving in the new economic reality

Let me borrow from Mr. Huxley by calling the current job market a “brave new world”. The current economic conditions, technology, and geography are conspiring to create a whole new paradigm for the next generation work force. The younger generation is catching on; the seasoned vets need to take note that the game is changing.

First, let’s define what is taking place….

Companies are restructuring in an effort to cut costs and streamline operations. The typical byproduct of such activities is layoffs and unemployment. Because Arizona is so reliant on industries that have been specifically pummelled by the recession- think construction/real estate- we find ourselves in especially dire straits. According to the US Department of Labor the unemployment rate in Arizona has doubled over the past year to 8.9%.

Second, let’s illustrate how proactive people are responding to this trend….

We have a very educated and resourceful job base, despite the numbers. There might be fewer formal jobs but that doesn’t mean that are no opportunities. Things are evolving and we, taking a page from Darwin, are adapting to the new changes. Companies still have work to be done, just not enough to justify full time employment. Smart people are engaging these companies and contracting those specific services. For those of us who are not up to speed on this trend go and do yourself a favor and read a great book like Free Agent Nation.

So companies still have work but just not enough to justify bringing you on. What do you do? Smart people are becoming “free agents” and selling their expertise to multiple companies. In a strange mutual fund sort of way this approach builds additional stability by diversifying your streams of income. It also provides for increased flexibility.

As more and more “free agents” enter the market it creates a need for cheap or free workspace like Gangplank. It is one of several locations valley wide that is popping up to provide entrepreneurs and other free lance workers with the traditional amentities of the office. That and the company is far better. One of the great side effects of such an arrangement is that it provides job seekers and entrepreneurs with the chance to interact and create synergy.

People are also taking advantage of opportunities to find affordable ways to further their education. For profit universities like The University of Phoenix and Grand Canyon University are all seeing growth as education tends to act in the reverse of the economy. Places like Training to You are able to use government stimulus money to provide professional training in areas like computer programming and project management.

In short, times are tough. But smart people are heading the words of Churchill and vowing not to give up. Smart people are taking a page from Darwin and changing with the times. Eventually things will turn around but it will be the people who are adapting now who will be in the best position to profit.

Lacuna announces referral agreement with PivotLink

FOR IMMEDIATE RELEASE

Contact:
Peter Watkins
Lacuna Strategic Marketing
Phoenix, Arizona 85006
Phone: 602-478-8187
http://www.lacunastrategy.com
info@lacunastrategy.com

Lacuna Strategic Marketing signs referral agreement with PivotLink to provide world class web-based business intelligence solutions to companies in Phoenix

Phoenix, AZ -- June 22, 2009 – Lacuna Strategic Marketing has entered into a referral agreement with leading Business Intelligence(BI) company Pivot Link Corporation. The move allows Lacuna to offer a complementary application that enhances its service offering as well as provides PivotLink with additional access to the Phoenix market.

The move is a natural extension of one of Lacuna’s core service offerings- marketing intelligence and analysis. The web based PivotLink solution provides a world class business intelligence platform that will deploy at a fraction of the cost and in significantly less time then traditional business applications. This platform provides the necessary foundation for the analysis and reporting that Lacuna Strategic Marketing provides.

According to Lacuna founder Ryan Jensen the move will “allow our services to be fully realized by providing our clients and prospective clients with a world class solution that will enable them with the necessary visibility and insights into their overall performance.” With a deal in place Lacuna Strategic Marketing will aggressively tout the benefits of PivotLink to prospective clients who are searching for simple and affordable business intelligence solutions.

About Lacuna Strategic Marketing

Lacuna Strategic Marketing provides world class competitive intelligence, marketing analysis, and strategic guidance to mid-sized companies who realize the importance in bringing in a trusted partner who can provide insights beyond their current capabilities. The company has provided guidance for such notable companies as LG, Infusionsoft, Disney, Nike, and British Petroleum as well as smaller enterprises looking for world class expertise at an affordable price.

About PivotLink Corp.

As the leader in on-demand business intelligence solutions, PivotLink serves over 6,000 business users in industries such as consumer packaged goods, e-commerce, healthcare, insurance, retail and technology, including customers such as: Car Toys; Guardian Home Care Holdings, Inc.; KoolSmiles; Novell; Rossignol; Shaklee and Zones. PivotLink's unique, self-directed reporting and analytics are based on the Software as a Service (SaaS) delivery model, providing users with complete analytical freedom with minimal IT involvement. Headquartered in San Francisco, California, PivotLink is a privately held company funded by Trident Capital, Emergence Capital Partners and StarVest Partners.

# # #

For information: http://www.lacunastrategy.com or
Contact: info@lacunastrategy.com
Phone: 602-478-8187

Bring proper marketing analysis from the lab to reality

We no longer need to fight to bring more analysis and logical reasoning to our marketing efforts. The past decade, with the maturation of sound technological applications, has brought a more measurable and scientific approach to our efforts to reach the right customers, at the right time, in the right place, and at the right price. Marketing analysis now has a permanent seat at the table and now it is time to take the proverbial lab coat off of the technicians so that the esoteric talk of the ivory tower can translate into real world results at the market place.

Gail McGovern of Harvard has done a great job of explaining the value of working with an outsourced partner who has the strong analytical left-brain know how that many marketing organizations lack. Smart technicians have taken heed to this trend and there are more and more companies that offer solutions in the realms of applied statistical analysis, econometrics, and predictive modeling. While this is great there is often a disconnect created between the science and the business.

Take a look at the latest issue of the Journal of Marketing Research and you will be bogged down with jargon, formulas, and language has a hard time translating to the day to day efforts of most marketing groups. You don't want to spend serious money on a report that gets left without an appropriate Rosetta stone that allows it to be directly applied to your specific set of circumstances. That's why choosing the right partner is so critical. They need to be proficient and knowledgeable in the application of the right analysis for what ever the situation calls for. But they also need to have a solid background in business and marketing so that they can translate the findings into recommendations that can be easily executed upon by the client.

So, what are some tips for leveraging your marketing analysis and your relationship with your provider of such intelligence?

• Demand that all research be brought home. Or in other words make sure that the insights provided is actionable intelligence that can be interpreted and acted upon all parties involved in executing the recommendations. It sounds very basic but you would be surprised at how many"inane" jargon and nuance laden reports end up in the hands of executives who have no idea what to do with them.
• Start simple or at least understand the underlying assumptions and models being used. That way there is greater transparency and you are a more involved participant in the process. Don't let ignorance prevail and take everything as scripture just because you see a lot of fancy greek letters everywhere.
• Always ask why. Many people advertise the fancy service or analysis without describing the benefits. Companies want the sizzle not the steak. They don't care about conjoint analysis but they care about what characteristics their next product should contain.
  

Choosing a partner that has the requisite analytical background is an essential complement to marketing activities. Finding one that has the ability to provide practical results that also fit nicely with corporate strategy is the paramount difference between success and just spending a lot of money on a bunch of propeller heads in lab coats.

Numbers Do Matter....now more then ever

Back in the old days a superior product, value chain, or marketing campaign could win you easy market share and profits. These days companies offer similar products and often share similar technology. Geography doesn't matter as much and technologies can be easily replicated. One of the last remaining vestiges of competitive advantage can come from a superior use and understanding of relevant company data: Business Intelligence.

Yes, this especially pertains to the world of marketing. Think of all of the new developments pertaining to marketing in the past decade. Whether it is running a series of online marketing campaigns or managing the efforts of a sales team the one common denominator is the increased presence of analytics. A recent quote in the American Marketing Association "Marketing News" magazine by Mike Linton, former CMO of eBay, underscores this point. "At its core, marketing is 70% math." Now I wouldn't quite go that far but you have to blind to realize that marketing is becoming more and more numbers driven.

Marketing needs to embrace numbers and math, and statistical analysis. It allows us to make smarter decisions and it gives us more ammo when we have to justify our marketing efforts to those curmudgeons in the Finance department. There are a whole host of tools that are now readily available and priced to fit most budgets. I have listed several in past entries so take a look.

The bottom line is that you need to measure and evaluate your efforts. You can start off by generating simple and straight forward reports. Eventually you can move to more sophisticated work that will allow you build models that will allow you to forecast the results of your efforts. This framework below was developed by SAS and was recently featured in the recent HBR book "Competing on Analytics". It does a masterful job of outlining the place and impact of most forms of analysis that most successful businesses employ today.


So take a closer look at your operations. Determine whether or not you have systems in place that allow you measure the performance of all facets of your organization. If you have any gaps or deficiencies than please bring in someone, like Lacuna, who can help you out. Marketing dollars are becoming more and more scarce. You absolutely, postively need to be able to analyze and exploit those actions that are generating the best returns.

Competitive Intelligence Case Study #1

Here is a recent example of a successful project that leveraged "competitive intelligence" to greatly enhance the sales and marketing efforts of a leading software company.

Relevant Reading

A great presentation from the good folks at Aquent.

Making Marketing Smarter Amidst the Cuts

View more presentations from Aquent Webmaster.

The ever increasing importance and availability of Marketing Analytics

Something that has long plagued the realm of marketing can now be strength. For the longest time marketing activities created results that were vague and difficult to measure. For example, how does one effectively measure the impact of a $500k commercial? As a result no hard fast ROI or impact could be measured by the folks in finance and the feel good activities, such as brand building, become the first things to get axed during difficult times like the ones we are currently facing.

Until now….

Our ability to obtain, analyze, and exploit data has improved drastically over the last few years. While it doesn’t quite have the buzz as something like “Social Media” or “Marketing Automation”, marketing analytics is just as if not more important. A successful marketing analyst can have a positive impact on every aspect of marketing- from market research all the way to revising a merchandising strategy. Here are few steps that will allow you to get back in the good graces of the guys in finance.

Data Accessibility

The marketing department has historically been dependent on a team of data analysts who were well versed in SQL and database management in order to get data. A disconnect usually resulted as analysts, failing to understand the business needs behind the request, would supply incomplete or rigid data to a marketing team, that wasn’t doing a great job of communicating their needs.

Don’t despair. There are several programs out there, such as U/SQL, which will allow marketing analysts to pull data from the warehouse. And the great thing about these programs is that you don’t need to be well versed in SQL programming. If this still appears too difficult or if your marketing team is constrained by an old legacy we recommend that you contract with a third party that can build an effective bridge. The bottom line is that you need to be able to get to all of your data.

Data Manageability

Now more marketing analysts are learning enough about databases to become dangerous. Simple bridges can be established to connect directly to the data source. And now that Excel 2007 can allow for over a million rows of data just about anyone can now effectively pivot data to pull out meaningful insights. Complicated procedures associated with setting up OLAP cubes are no longer as necessary. There are also plenty of products, such as Tableau Software, that do an excellent job of making the data visually come to life.

Once this is established the team can then focus on weightier matters…namely analyzing and coming up with effective measures that impact their unit’s bottom line. A competent analyst or third party will be able to create an automated dashboard or worksheet that will efficiently bring in data and allow it to be measured according to specified KPI’s and measures. This streamlined process will then free up the team to focus on ad-hoc or other projects that are deemed important.

Data Exploitation

If you’ve followed the above two recommendations than you are on the cusp of justifying your existence to the guys in finance. Why? Because you’ve minimized the amount of time needed to obtain and analyze data. You have reduced the need for an additional layer of IT support. And you’ve set the ground work for the types of measurable analysis that they demand in order to green light future marketing expenditures and justify current projects. The numbers don’t lie and now you’ve got them on your side.

With the data close at hand you can easily perform the types of analysis needed by finance to gauge viability. You perform statistical analysis to look for significant trends and insights in sales data. You can visually show the impact that a certain promotion had over a certain region in order to better understand its impact. The bottom line is that you can now look so much cooler and do so much more then you could just a few years ago when these kinds of dreams would have only been fulfilled by a costly Business Intelligence software implementation.

Happy mining! It’s a brave new world. But the sooner you can figure out how to get direct access to your data the better you are. And the more time you can spend analyzing the data instead of getting it the better you are for your company. During lean times like these this is prescription that will carry some serious benefit.

Overview of Lacuna Enterprise Offerings

Several of you have asked something that is both concise and illustrative of the core services offered to mid-sized companies. Here it is.