The Market-Intelligent Executive

Customer Experience Lessons from the Obama and McCain Campaigns

The Obama and McCain campaigns provide lessons for organizations striving to deliver compelling customer experiences.  Both campaigns are increasingly crafting sound bites and photo ops designed to stir emotion and influence a specific voter persona--those who are still undecided. 

In the private and public sectors, emotions drive customer experiences and decisions.  Presidential candidates use tracking polls to tell them what emotions they are are creating among voters.  In response, politicians change their tactics daily.

While Obama's platform includes tax reductions for 90% of households, the McCain campaign has repeatedly referred to Obama's intent to raise taxes on the middle class.  McCain's sound bite is easier to understand and strikes a powerful chord with voters, even if it's arguably untrue.  The facts, however, carry less weight among undecided voters at this point in the election cycle. 

Emotions rule, particularly among voters just getting to know the candidates.  The persona of today's undecideds is different from those who've been paying close attention for the last 18 months.  Today's undecideds are less engaged.  They are more responsive to sound bites and photo ops than detailed analyses of policies and character. 

The process by which the American electorate chooses presidents is representative of how customers choose your products and services.   They make decisions based on emotions, not necessarily a lengthy or even rational comparison of features.  Emotions drive customer experiences. Each customer persona responds differently. 

If you know what emotional hot buttons to push, how to push them and among whom, you'll be well on your way to innovating customer experiences that grow grass roots support.

--Jason M. Sherman is president of customer experience firm, Whyze Group.  Whyze Group helps management teams throughout the U.S. innovate faster and more wisely.

Basic Challenges of Effective Crowdsourcing

We are pulled toward shiny, new technology baubles, especially ones that promise greater customer intimacy and, ultimately, profits.  Crowdsourcing is gaining traction after a couple of years of finding successful case studies (e.g., Threadless) that prove the concept...at least for specific applications.

Historically, other shiny baubles, like early dotcoms and CRM, lost their luster when they failed to live up to expectations.  In hindsight, we learned, "This could be a great addition to our tool chest. We should learn how to use it next time."  History will repeat.

Crowdsourcing is so new that there are few real experts in it.  But, a critical look at the social and business challenges and Web 2.0 technology platforms that support crowdsourcing reveals important clues about how to manage crowdsourcing effectively. 

As Donald Trump once said, "If you manage the downside, the upside takes care of itself".  In her post about the challenges of crowdsourcing, Monica Hamburg does us all a great service by stripping the silvery patina off crowdsourcing and looking carefully at the cold gray steel underneath. 

Among Monica's observations, which I'm paraphrasing, are the following:

• Questionable wisdom. Not all crowd members act in the spirit of crowdsourcing or are well-intended. Just look at the stream of comments following a Youtube video.
• Limited demographics. The typical web user is white, middle- or upper-class, English speaking, higher educated and with high-speed connections.
• Myopic understanding. Crowds may not have enough understanding of your industry to make educated decisions.
• Limited control. Loss of control can result in crowdslapping, where the crowd turns on you and your brand.  This may not be avoidable, especially if you want to encourage open dialog, which is the whole point of crowdsourcing.
• Lower quality.  Quality expectations for some tasks should be lower, not higher, depending on the task that you're asking the crowd to do.
• Insufficient programming.  This is the digital analog to coffee, donuts and engaging events, which, if missing, will result in the crowd moving on.
• Leadership.  Lest your crowd detect they've entered a space where anarchy reigns, you've got to have a socially astute host who introduces topics, moderates discussions with a light and easy hand and celebrates victory when the crowd takes ground.
• Exploitation fears. Key contributors expect and deserve rewards for their participation.  These need to be spelled out in advance and followed through religiously.

Each of these challenges are overcome with a little forethought and deliberate action.  Effective crowdsourcing starts with defining the problem that you're going to ask the crowd to solve.  The assignment needs to be specific, measurable, easily understood, and framed in a way that engages the right crowd.   

Threadless is a great example of engaging a crowd to solve attractive new product development problems.  The crowd designs t-shirts and votes on the winners. Threadless draws the right crowd, designers who can really design creative, off the wall t-shirts.  Their reward system is transparent and straight forward: winning designers get $2,500 in cash and gifts.  Their website is fun, engaging and serves as a catalyst for a creative community of talented artists.

Underlying their website is a savvy set of facilitators who change the website each day, posting recently submitted designs for sale and votes.  This draws in a global talent pool that the company taps successfully and whom extend Threadless's idea-generating capacity far beyond the walls of the company.

If your company is considering crowdsourcing, your approach should be equally clear and compelling. 

This post only covers the basics of effective crowdsourcing.  There will be more to come.

--Jason M. Sherman

Jason M. Sherman is president of Whyze Group.  Whyze Group provides crowdsourcing and collaborative design facilitation as part of its customer experience discovery and design services to companies throughout the U.S. 

Focus Groups vs Crowdsourcing Debate

Focus groups are out. Crowdsourcing is in.

Those who make a living on the bleeding edge are proposing Web 2.0 social networking technologies as replacements for focus groups.

Today's oft recommended solution-du-juor, crowdsourcing, is defined as, "the use of people and companies to help other people and companies for compensation," according to Paul Poutanen, president of crowdsourcing firm, Mob4hire. 

That doesn't sound so different from focus groups. 

But wait, they say. Unlike focus groups, crowdsourcing is inexpensive, unbiased, fast and reliable...because large numbers of customers are collaborating in the innovation process right there with you, in real time. 

With crowdsourcing, they say, all you have to do is define a problem for the crowd to solve, find customers who care and who can solve the problem, invite them and compensate them for their contributions.  Companies need only facilitate the collaboration process and discern which of their many ideas the company should implement.

That's unlike focus groups, where you have to define the problem, find qualified customers, compensate them, facilitate the process and figure out which of their ideas to implement. 

See the difference??? 

Neither did I.

The fact is that both crowd sourcing and focus groups have their place.  Choosing requires exercising judgement in defining the problem to be solved and in how each tool is most usefully applied.  The chooser must be able describe why one tool was chosen over another in way that is informed, transparent, and imbues decision makers with confidence.

I'll write more in upcoming posts about situations in which crowdsourcing, focus groups and other tools are optimally used. 

In the meantime, remember that information technologies are only tools.  They render value measured by the skill of the hands using them.

--Jason M. Sherman

Jason M. Sherman is president of Whyze Group.  The company uses crowdsourcing, focus groups and other tools on behalf of Fortune 500 companies that are learning how to innovate their customer experiences.

Best Practices Range from Useful to Destructive

I've been advising clients to exercise skepticism when evaluating anything positioned as a "best practice".  What works well at one company is sometimes counterproductive at another. 

Today, I received an email promoting excerpts from a study titled, "Developing the High Peformance Market Research Function: Study Excerpt". 

Aside from providing no criteria against which the practices described were evaluated, the premise of this report seems to defy logic.  The report is essentially a derivative of research performed by the sponsor on behalf of its clients, which begs the following question.  Why would client firms knowingly handover proprietary secrets (their best practices) for publication to the world? 

For those readers who are concerned about this, you need not worry.  Here's an example of a best practice cited in this report. "Competitive intelligence stands out as a research activity that many benchmark partners seek to integrate within their market research organizational structures."  Here's another, "Benchmark partners were aligned in their aspirations to turn market data into intelligence that can grow the business." 

There are other best practices, which border on the comical, such as one suggesting that when companies invest tens of thousands of dollars in focus groups someone from product teams should actually attend the groups. 

There is in this excerpt no acknowledgment of the lowly perceptions of marketers, and particularly marketing researchers, among CXOs (see my earlier post, "There's an Elephant in the Room").  There are no new prescriptive methods described outside of similar platitudes that were uttered decades ago.

As catalysts of strategic adaptation and innovation, we have a sacrosanct obligation to our colleagues, employees, our shareholders and our customers to get it right.  Getting it right starts with an open mind accompanied by critical thinking and a good measure of honesty.  If we're really honest with ourselves, do best practices like these have a place in our communal dialogue?

Yahoo! Customer Service Unwittingly Contributes to Potential Scam

Yahoo! email users appear to be the unwitting victims of a scammer posing as Yahoo Customer Service.  Paradoxically, Yahoo customers' inaccessibility to Yahoo's customer service is contributing to the problem.

Users receive an email saying that they have to "verify your free yahoo account" or lose their mail box in two weeks.  The sender asks for the customer's user name, password, date of birth and country of origin.  I received one of these messages this morning.  My suspicions were raised when I found two grammatical errors in the sender's email.

The irony is that users can't report the problem to Yahoo customer service.  There is no way to easily contact customer service on Yahoo's website.  I Googled "yahoo customer service" but didn't find contact information for Yahoo customer service there either.  Instead, I found numerous posts from frustrated users venting about their inability to contact Yahoo customer service!

I don't mean to bash Yahoo.  I've used their email services for years.  There is, however, an opportunity to reflect on what "customer service efficiency" means.  In the case of Yahoo, it means easy navigation of their websites, answers to frequently asked questions and host of other resources...but not the ability to talk with them live. 

Is your customer service efficient?...for you or for your customers?  Most companies' understanding of the customer experience is mistakenly limited to touchpoints.  But, the customer experience doesn't begin and end with touchpoints.  In fact, some of the most influential customer experiences happen when the customer isn't in touch with company, or can't be in touch.  Yahoo is learning that the hard way.

We'll see how this potential scam plays out.  In the meantime, if your company is focused exclusively on managing touchpoints with customers, watch out.  The only way to understand the customer experience and make it better is by living in the shoes of your customers.

-Jason Sherman

Jason Sherman is president of Whyze Group

Graeter's Ice Cream: A No Fluff Customer Experience

We have to coax our organizations to deliver genuine, compelling customer experiences.  Promotional fluff alone won't cut it.  In some organizations, the only marketing they do is caretaking for the customer experience.  The rest is driven by street buzz.  Case in point, Graeters.

Graeter's is a Cincinatti-based manufacturer of premium ice cream.  What's the street buzz on Graeter's?  To die for.  Prospective franchisees call the company daily.  Conglomerates have offered to make the current owners rich in a buyout.  Oprah made the company famous by raving about it.  And, having just tried my first pint, I'm thinking of defecting permanently from my tried and true Ben & Jerry's. 

My Graeter's experience began with my peering into the ice cream freezer at my grocery store.  After a couple of minutes, the dairy manager asked me if I had found what I was looking for.  I hadn't.  My beloved Ben & Jerry's was gone. 

He departed to the stockroom and returned with a pint of Ben and Jerry's chocolate fudge brownie.  I asked what had Uncles Ben and Jerry done to warrant taking away their shelf space.  He said, "Nothing, it's a great product, but we're carrying more Graeter's.  Graeter's is the best ice cream I've ever had.  Have you tried it?" 

Sacriledge, I thought.  But, my curiosity was aroused so I replied, "No. What so great about Graeter's?"

He said, "the company only uses the best ingredients and they make it in two-gallon batches.  They use the french pot method, which avoids the need for injected air and creates a dense, rich ice cream. It's packed it by hand.  Our purchasing manager got a couple of pints of Graeter's as a gift.  He tried and said, "We have to carry this."  He called Graeter's and asked for an order but the company told him that they didn't have any way to fill the demand."  I felt like I was in a TV commercial shoot.  The only thing missing was the hidden camera. 

Fast foward a few days to a phone call I made to Graeter's headquarters. "You didn't have any way to fill that order?" I asked company president, Rich Graeter.

"We make the product the same way we did 100 years ago. It's just cream and natural ingredients, no air, no preservatives.  The french pot process requires that the product by made close to the customer and is best consumed within days of production.  We could have shipped it, but we chose not to."

Mr. Graeter explained that the 140 year-old company didn't even brand its products, selling them in plain white containers, until relatively recently. 

Street buzz, part two....I told a colleague about my Graeter's experience.  He said, "People flying out of Cincinatti carry frozen Graeter's home with them.  It's that good." 

How to Establish Yourself as an Internal Consultant

Consulting is a privilege bestowed by someone who has a problem and asks you to help find a solution.  And the key words are, "asks you."

Many corporate marketers and researchers are under the impression that they should be consulted when there's a strategic decision at stake.  That's not consulting.  That's wanting to be consulted.  There's a flaw in the notion that decision-makers somehow have an obligation to us. 

One corporate researcher shared his frustration with me about internal clients who were ignoring or running roughshod over him.  I asked him, "Have you earned these people's regard as a consultant?"  He looked back at me quizzically.  So, here's the essence of the pep talk I gave him.

• You're bright, inquisitive, ambitious, creative, analytical, experienced and many other qualities that helped make you a great marketing researcher.

• Being consultative requires more than a desire to be consulted.  Your internal clients need to see you as a thought partner who can help them define and solve their business and career problems, not just their research problems.

• Advocating marketing research is fine, but sometimes there isn't a sufficient business case for doing marketing research.  Applying a balanced perspective with clients rather than pounding the research drum will position you as fair minded and, therefore, more valuable to clients.

• Learn how the company makes money.  Understand how profitable each product is by unit and gross contribution to the bottom line.  Explore your clients' ideas on how operations might be streamlined.  That will help you think-through with clients where the biggest opportunities to help are.

• Help your client clarify what decisions are at stake, what the alternative are and how you'll choose one.  Ask about who's involved in making the decision and what their key concerns are.  Address these issues in the research design.  This will help your client begin creating alignment and support among other stakeholders.

• Show that you care about your clients.  Communicate your desire to help them succeed.  Ask them how you can help with other projects they're working on.  They'll appreciate your concern and will be more likely to bring you into their cadre of trusted advisers.

 

       --Jason Sherman, Whyze Group

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Getting a Grip on SEO

A recent American Marketing Association survey describes search engine optimization as among the new skills marketers feel they need to learn. 

Yeah.  That'll be the solution to marketers' woes.

As a gentle reminder (read "There's an Elephant in the Room" here) CEOs and others outside of marketing view marketers as lacking in innovation and communication skills, not SEO skills. 

So, let's put SEO in perspective.  It's just another marketing investment that you should consider based on the facts.

Having just evaluated SEO firms for my website, I've decided that it doesn't make sense to invest much more than I already have, but it might make sense for you.  I'm not an SEO expert, but here are some basics to help fellow neophytes get started.

What SEO Is

SEO consists of techniques for getting your company's website listed highly in response to searches on Google, Yahoo and other search engines.  SEO relies on website content, key words, meta tags, links and other devices that lure search engines into thinking your site is the be-all-end-all on specific topics, industries or products.

Cost

The costs of SEO are driven mostly by the time you or someone you hire invests in making your site search-engine friendly. 

Buying Placement on Keywords

You can buy your way into higher search engine rankings, but here's the rub...If you want to come up high in searches on the most commonly used keyword searches, it's going to cost you much more than if you get more specific with the keywords on which you want to rank highly. 

Here are a couple of examples:  My dentist pays $40,000 per year to be listed among the top results for searches on "dentist", "Cleveland".  A friend who runs bar tending schools on Long Island pays $25,000 a year to show up in the top rankings.  That's for "bar tending school", "New York".  Pretty specific stuff.

Now imagine what the investment would be for searches on your industry or your product category, particularly if you have national or international reach.  We're talking big bucks, but it may be worth it.

Overture

Www.overture.com (now called Yahoo! Search Products) includes a free service that will tell you how many searches were made last month on any combination of keywords.  For example, there were about 7,800 searches on "marketing research" in July.  Those searches produce several million listings, so getting to the top of those page rankings would be difficult for our boutique firm.  Searches on "market intelligence" were far fewer, but this is what we genuinely offer, so those are among our key keywords.

My advice (and, again, I'm not an SEO expert) would be to try unique combinations of keywords that are specific to your brand and unique product characteristics.  If you're an auto insurance company, for example, try "auto insurance", "New York" and "declining deductibles" if you offer that feature.  There will be fewer searches on those terms each month, but your chances of getting a higher page ranking are greater.

A Moving Target

There are hundreds of SEO firms out there working with thousands of businesses to get their search rankings higher.  SEO isn't an event, it's a long term commitment.  High search rankings today can disappear as competitors use new strategies to get their rankings over yours. 

Next Steps

• Read up on SEO.  It could be a powerful addition to your marketing mix.

• Talk to a few SEO firms to get a sense for how they can help.  If any promise that your site will consistently be listed first, walk away.  No one can guarantee that. 

• Try to winnow down your keyword combinations to those that differentiate your offering.  You're trading off volume for efficiency.  Ask your prospective SEO firm for their suggestions.

• Evaluate the business case for SEO, particularly if you're considering buying placement on keywords.  You might get a sense that your ROI will be higher for other kinds of marketing investments.  It's perfectly fine not to jump into online marketing investments if you've got better ways to spend your money.

      --Jason Sherman, Whyze Group

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Frustrated with Your Company?

I have a colleague at a Fortune 500 company who was once very frustrated with his organization's low level of marketing sophistication.  If you've felt similarly, take heed...Understanding your organization's execution maturity and how to improve it will help.

Execution maturity has emerged in consultant-speak (ah, leave it to consultants to come up with new buzz words) as a framework for assessing your organization's proficiency...in this case, its ability to transform market intelligence into profitable innovation.  Your company executes the process at a level of proficiency you can assess.

Execution maturity covers three dimensions: supply, demand and application.

Supply

This refers to the capacity of our organizations to develop useful market intelligence.  At the low end, market data is generated by an unskilled staff who collect secondary research or manage very basic surveys. Anecdotal reports from sales people and others around the organization might contribute more data.  There's no repeatable "intelligence process" in place. 

At the top of the scale are organization's proficient in marketing research, business intelligence and competitive intelligence. This is not to say that these same organizations demand this intelligence or apply it well.

Demand

This refers to what stakeholders ask for.  In mature organizations, decision makers are knowledgeable about different kinds of market intelligence and how to use it. 

In organizations where there's little maturity in demand, research departments are often peppered with lots of irrelevant requests.  (I used to get these on sticky notes at one firm that will remain nameless.) Often, these have little to do any decisions to be made (otherwise known as "CYA" research). 

Application

This refers to transforming market intelligence into profitable innovation.  It's not unusual for companies to be proficient at executing marketing research but inept at applying what's learned. Here are a few more things to consider:

• Dissemination.  Is market intelligence freely accessible to those who could use it or does it only reside in the heads of requesters?   

• Combining.  Are multiple data sets being combined to create powerful, proprietary views of innovation opportunities? 

• Decision rights.  Do users have the authority to act on the intelligence?  If not, then there will be little application value.

Implications for Marketers and Researchers

You might not be able to avoid frustration, but managing it is key.  To begin improving your situation,

1. Estimate your organization's maturity on each dimension
2. Selectively validate your assessments with trusted colleagues
3. If enough people with juice in the organization agree with your assessment, then you'll begin to gain traction
4. Get ready to act.  If demand is a problem, be prepared to educate.  If application is the problem, get more consultative in up-front intelligence planning.  If supply is the problem, look for external vendors who can complement your existing capabilities.

     --Jason Sherman, Whyze Group

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Research Doesn't = Intelligence

The difference between market research and market intelligence is this: marketing research is a data collection activity; market intelligence is a differentiating connection with buyers that exists in the hearts and minds of company leaders. Market intelligence drives companies to innovate and orchestrate a compelling customer experience. 

Some marketing research imbues company leaders with market intelligence. Some doesn't.  My colleagues in the U.S. and U.K. agree that a signficant portion of marketing research studies never create intelligence or lead to profitable innovation.

When we begin working with new clients, we compare their existing marketing research data with what they do and the business results they get.  Here are two examples of where marketing research failed to produce market intelligence and presented significant lost opportunity costs:

• A mortgage division was investing $200,000 per year on customer satisfaction research.  Reports consisted mainly of several thousand verbatim comments. No one other than the customer service director read these reports.  This company should have acquired far richer intelligence and put it in the heads of far more people running the company.

• A health insurance company was disappointed with the demand its direct response TV ads generated.  They had used dial testing in the course of developing the ads.  This particular dial testing study showed where the audience perceived high and low points during the ad, not where it perceived superior or inferior benefits relative to competitors. This is what this company really needed to know at the time to produce highly effective ads. 

Marketing research can elevate the state of market intelligence in your organization.   But, simply "doing more research", (which seems to be the modus-operandi at many companies), and having non-experts design research studies significantly increases the risks of wasteful research investments and lost strategic opportunities.  Only the right kinds of marketing research for your situation at that moment will lead you to the promised land.

     --Jason Sherman, Whyze Group

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If you have a questions, comments or an article you'd like to submit to The Market Intelligent Executive, please email here.