Christopher S. Penn – Marketing AI Keynote Speaker

Category: Sales

Your ACE in the hole: Energize!
We talked last time about what marketing, sales, and product & service groups are supposed to manufacture. Let’s talk about the verbs that go with them, so that you have an idea if what you’re doing is in alignment with those verbs, and one verb in particular. Quick review:
- Marketing takes audience and makes qualified leads
- Sales takes qualified leads and makes customers
- Product design and customer service takes customers and makes evangelists
So let’s take a look at the verbs of this funnel. In short: ACE.
- Attract.
- Convert.
- Energize.
Attract is what marketing does. Create demand for your ideas. Attract attention to what you have to offer. Assuming it’s good, people will pursue a line of inquiry and become a qualified lead. Attract also helps filter out some stuff – is what you are doing likely to attract leads? Billboards attract eyes, but unless they’re hyperlocal (Eat at Joe’s Next Exit), their value is questionable. Are you attracting the right people? You may be getting all the buzz in the world for your event, but if no one can afford to attend it, those thousands of visitors and millions of pageviews are worthless.

Convert is what sales does. Convert puts the emotional and rational values on the table with the qualified leads, the prospects, and helps them to convince themselves that your product or service meets or exceeds their needs. Again, convert is a useful verb. Is a sales practice converting? Do you know what converts and what doesn’t convert?

Energize is what product design and customer service do. We used to call this retention, but when you think about it, retention kind of implies that your customers are fleeing your products and services. It implies they want to run away as fast as they can, and you have to pull out all the stops to keep them from doing so. No, if your product doesn’t suck and your customer service actually cares about its customers to any degree, then you’re not talking about retention as much as you are talking about energizing your customers.
- Energizing them to use the product or service to its full potential.
- Energizing them to give you unsolicited suggestions about what would make it even more rave-worthy.
- Energizing them to tell everyone who will hold still long enough about your product or service as your unpaid word of mouth marketing department.
Energize is where all your profit is, long-term. If your product sucks, it will not energize customers to do anything more than pay the bills – if that. If your service sucks, it will only energize customers to hate you, very publicly and very loudly. Energize is what will destroy the other two departments, marketing and sales, because marketing will not be able to attract audience due to your stigma in the community. Sales will not be able to overcome fear, uncertainty, and doubt in what few prospects you have. Eventually, you’ll either have to make even more ethically questionable marketing and sales choices just to keep the lights on or go out of business.

The flip side is the fun part. Products that are raveworthy and service that is insanely great means that marketing just has to get people to the web form to sign up. Marketing can clock in at 10 and clock out at 2 with an hour martini break in the middle of the day because existing customers are raving about what you’ve got and forcibly dragging friends into your showroom. Sales has to triple its manpower just to process the paperwork, and prospects need little guidance except perhaps what color ink to sign on the contract. All of this comes from energizing your product design to be great and your customer service to be the best thing anyone has ever experienced.

Unsurprisingly, energizing product design and customer service is really, really hard. You as a company must be committed at every level, in every way, to putting your customers first and foremost. Everyone from the janitor who answers the phone late at night while cleaning to the CEO must get it, must understand that the vast majority of your long-term focus must always be on doing right by the customer. The moment that you lose that focus, you lose your ACE in the hole, and until you get it back, you’re on the path of the corporate death spiral.

Attract. Convert. Energize.

Profit.

Photo credit: DotBenjamin

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February 3, 2010
The only marketing metric that really matters

I’ve said in the past that marketing is the art of creating demand for your ideas, but in terms of something measurable and impactful, what does this mean? What does marketing make? Yes, it creates things like ads, Twitter accounts, email, etc. – but those are the tools to execute the mission of marketing. What does marketing actually do that’s measurable and meaningful?

Throw out all your other metrics. Followers on twitter, hits to your web site, mentions in the media. Toss them all.

The only metric that matters is this: qualified leads.

On the continuum of business, marketing (which includes marketing, advertising, and PR) takes media and audience as its raw materials and makes qualified leads.

Sales takes those raw materials, those leads, and makes them into customers.

Product design and customer service take those raw materials, those customers, and turns them into evangelists.

Everyone and everything that’s doing marketing makes qualified leads. We may not call them as such – we might call them volunteers for the non-profit, new members to the congregation, new players in the Warcraft guild – but they are.

I’m being a little facetious when I say toss out everything else – but not by much. Things like site traffic, media mentions, etc. are good diagnostic measures to tell you what’s happening with individual tools and processes, but at the end of the day, the only metric that shows you the results of your actions is the number of qualified leads that you pass on to sales to convert. For small businesses especially, marketing, sales, and service may be the same person, the same sole proprietor, but the count of qualified leads is an important number, not to be missed or glossed over.

Finally, metrics that are really trendy and popular, like ROI, are built on qualified leads. You can’t compute Return on Investment if you have no idea what the Return is, and you can’t get a Return on your Investment until you have some leads for Sales to turn into business. Worry later about ROI and worry more now about how many leads Sales has to work with.

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January 29, 2010
The iPad will be legendary for sales and marketing

Steve Jobs and gang did a phenomenal job introducing the iPad for consumers. Books! Movies! Music! Games!

…but…

The iPad has the potential to make sales and marketing people into legends. Take any sales demo you’ve ever done. Take any presentation you’ve ever done. Now take it on the road. Got a prospect you want to chat things over with in a coffee shop? Bring out your Keynote app (iWork for the iPad) and you’re showing your deck or demo on a glass 10 inch screen without all the hassle of keyboards, mice, remotes, or other crap. Just open your leather binder and show the show.

… and then …

Remember: iPhone apps run on iPad out of the box.

So you swap from your slide deck to your Salesforce.com iPhone app. You take the order right there. You’re done, and you’re on a device that looks as slick as your product or service hopefully is. No Salesforce? Use iWork’s Numbers app and fill in your order spreadsheets, or fire up Safari and complete the lead form on your web site because you’ve got 3G wherever you’ve got good mobile service.

Professional speaker? The Keynote Remote app for the iPhone will run out of the box on the iPad. Instead of squinting at your iPhone while using it as a remote for your Keynote presentations (because your laptop is tethered to the projector), you have a gorgeous way to display your speaker notes and control the show from the podium. Just slap your iPad on the podium and swipe its screen to change slides, see your speaker notes, and not miss a beat. If you’ve ever presented professionally and wished that the venue could provide a speaker’s screen, the iPad is now that screen for you regardless of venue.

Image: Engadget

Yes, you’ll be able to handle all the mundane things that iWork and other iPhone apps can do, but the large, large screen will be perfect for when you’re at trade shows, conferences, and coffee shops as a way of showing your customers and prospects all the goods you have to offer without lugging an entire IT department around with you. Anyone who’s ever hung out with me at a conference knows that I lug a server farm with me – and I probably still will to some degree, but this device certainly will make life easier for the working professional. As a bonus for conference-goers, when the venue Wi-Fi implodes – as it always does – your iPad will feed your data addiction with its 3G connection.

I can’t wait to get my hands on one of these.

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January 27, 2010
What casino gambling should teach you about online marketing

I recently had the opportunity to spend a few hours observing (not playing, I know the house odds!) people at a casino during a business conference. What a superb experience – not as a player, but as a marketer, to see how casinos manage the end user experience for maximum profit.

Imagine for a minute that someone put a box in front of you that, on average, will give you 42 cents for every dollar you put in it. No one in their right, rational mind would ever use it. Imagine for a minute that someone built an ATM that gives you exactly 42% of whatever amount you request. That ATM would be torn out of the wall by riotous crowds.

Yet thousands of people a year flock to casinos and use machines and games designed to do exactly that. Why? Because casinos have mastered the user experience.

Let’s take a look at some of the tricks of the trade:

1. No windows or clocks. Time is the enemy for casinos – they want you to spend as much time as possible in the venue (on the premise that you’re not a weirdo like me who just stares at people without spending money) and gamble as much as possible. No cues to show just how much time has elapsed ensure this.

2. Low lighting and lots of ambient sound. Every machine in the room makes noise, and more often than not, even the demo modes have sounds that are pleasant to the ear and evoke video game-like feelings of winning. Why? Low light keeps you relaxed and slightly less aware than harsh, stark light, and lots of ambient amusement sound contributes to the idea that you’re playing games instead of spending money.

3. Play money. I lost count of how many times players referred to their chips as play money, fake money, toy money, or some other proxy by which they completely forgot they were using real currency. At one blackjack table, I saw enough money cross the table back and forth in just a few minutes (table minimum $200, maximum$ 50,000) to buy several cars. Casinos use proxies for money to get you to spend more, because the money doesn’t look or feel like money at all.

4. Leave no dollar behind. Right outside the casino floor was… a Rolex shop. And an art gallery. And a Swarovski crystal shop hawking stocking stuffers starting at $40. Casinos know this above all else: you might win on the floor, but you’re not leaving with your money if at all possible. Every hook imaginable is available to get you to spend anything you didn’t lose to the house.

Now, how does this apply to marketing online? Take a look at your web site. Does it evoke the feelings that you want to elicit from your customers? If your goal is to get customers to spend some time with your content, does the “atmosphere” of your web site – color palette, brightness, tonality, contrast – encourage your visitors to relax, to forget about whatever else they were doing? Look at the patterns of lights and textures in a casino and you see endless repeating patterns that are nearly hypnotic. I’m not saying you should turn your web site into a slot machine’s decor, but think about what decor you do have and what it’s conveying.

Take a look at how you process transactions. Do you make it as easy as possible for visitors to transact with you? Do you use proxies for money like point systems or credits? In a casino, you can slap down a C note on the green velvet and have chips in hand, ready to gamble in less than 10 seconds. How fast can your visitors buy? Does your site let your visitors slap down the plastic and buy immediately? iTunes and Amazon figured this out long ago with 1-click.

Are you leaving money on the table? Are you letting your visitors get away with their wallets intact? What other things can you sell to your visitors as they browse through and leave your site? I’m not saying be obnoxious and run a javascript that forces a visitor through an annoying series of ads, but think about all of the different products or services you have and that you sell via affiliate programs. Are you presenting them as powerfully as the Rolex shop in the casino next to the cashier’s cage?

Casinos make good money because they’ve distilled the user experience for maximum profit. Are you doing the same?

Photo credit: acaben

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November 16, 2009
What World of Warcraft can teach you about gear and skill

If you’ve ever played any character in World of Warcraft, you know about the diminishing returns of gear. If you’ve never played Warcraft, it works something like this: once you’ve reached the top level of growth for your character (currently level 80, soon to be 85), any gains you get to make your character better come not from “leveling up” but from getting better gear, better armor, weapons, etc.

In the beginning of your gear quest, vast improvements in your character’s capabilities are easy. Going from a green “uncommon quality” item to a blue “rare” item can add more power, more strength, more valued attributes to your character in great leaps. Your character can perform far better in the game in these early jumps in equipment.

However, as you keep gearing up, going from blue “rare” items to purple “epic” items, the items get more costly (or more difficult to obtain) for statistical improvements that are orders of magnitude smaller.

After a certain point, you reach diminishing returns, where the gear’s improvements are so small that the comparatively large efforts to get the gear simply isn’t worth it for the average player. Where a blue “rare” item might take half an hour’s worth of work, a top, best-in-game item might take weeks. Granted, it’s a game, so as long as you’re having fun there’s no penalty towards getting that gear, but it’s still significant diminishing returns.

After you reach the point of diminishing returns on gear, the best thing you can do as a Warcraft player is to spend time learning how to play your character’s skills with the gear you’ve got. Gear, after all, merely magnifies your skills. Learning the various ways your character can behave in combat, learning to fine tune your use of the right skill at exactly the right time – these are the things that will not only make the most of the gear you’ve got, but in some cases will negate any gear disadvantages you have. Anyone on a team in the game knows that it’s better to have a slightly undergeared, excellent player leading your team than a highly geared, incompetent buffoon running the team.

So what does all this have to do with anything? Well, life is exactly the same. Take photography – after a certain point, you’re just spending money on lenses and other gadgets with fewer and fewer returns. That first zoom lens makes a big difference in your photography. The jump from a 55-200mm to an 18-200mm isn’t earth shattering, just convenient. Photography gets to diminishing returns VERY quickly – better to learn how to compose and shoot with the gear you have after the entry level improvements. Better pictures come from better skills – gear magnifies skill, but doesn’t improve it. Only learning and practice improves skill. I’ve got a Nikon D90 with a few lenses, and when talking to Marko Kulik (a photography expert), he basically said I’ve got all the gear I could possibly need for years – now I need to learn how to use it well.

Look at marketing. The first analytics software you start using is an incredible leap from no analytics at all, or guesswork based on server logs. After that, you get diminishing returns on the quantity of information you get from web analytics – and the real juice to be had in web analytics is not learning what numbers you have, but what they mean and how you can change your business practices to serve your customers better.

Accounting? Lots of businesses run quite well on Microsoft Excel, not because they don’t want to buy an accounting package, but because their accounting staff is sufficiently skilled enough in Excel that the gear upgrade won’t make a difference in their performance – and might even diminish it.

In the end, gearing up is important only to the point of diminishing returns, whether it’s marketing or Warcraft. The lesson is the same across nearly all professions, trades, and hobbies: gear magnifies skill. Gear up to get past entry level limitations, then focus your time and energy on the skills you need to tap the potential of that gear.

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September 5, 2009
Why do we do these things?

We hate salesmen trying to sell us stuff but we love going to street fairs with lines of merchants wanting to sell us stuff. Why?

We hate high pressure sales but we love going to expos like the Big E where barkers shout out the highest pressure pitches you could possibly ever receive. Why?

We hate advertisements of all kind in our media but we love tuning into the Super Bowl for the ads. Why?

Please leave your answers in the comments.

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July 19, 2009
The Passion Funnel

The passion funnel is much less dirty than it sounds.

For every discussion of monetization in new media, there’s an equal discussion about the amateur, the practitioner who does something for the pure love of it and not for money. However, amateurs can still take a great deal of knowledge from the professional world and apply it to their work to see how successful their efforts are.

Take an average new media sales funnel:

Audience
Prospects
Leads
Conversions
Evangelists

Audience is the potential number of people you can reach in any given medium.

Prospects are the subset of the audience that is likely to be interested in what you have for sale.

Leads are the people who have expressed interest in what you have for sale.

Conversions are the people who commit, who buy what you have for sale.

Evangelists are the people who are so in love with what you’ve got, with what you’ve sold them, that they incite others to become prospects as well.

You can measure each stage, use different tools and talents at each stage, to drive sales.

Audience tools are the channels themselves – Facebook, Twitter, email, etc.

Prospecting uses demographics and databases to figure out who your most likely customers are, based in part on the customers you already have. If I run a Financial Aid Podcast or a Marketing Podcast, I’d better be finding the portion of audience in each channel that’s interested in financial aid or marketing. Tools like Google’s Ad Planner and Facebook’s Media Planner can help with all this.

Leads uses your web site and associated persuasion tools – good copy, calls to action, etc. – to convince the prospects to buy. Analytics tools like Google Analytics, Clickheat, database analysis, and so forth can help you diagnose your lead generation process and figure out where you’re turning people away.

Conversions is your sales engine, your transaction engine.

Evangelism uses your media channels of choice to encourage your customers and fans to spread the word. Note that evangelism is driven by awesomeness. If you have an awesome product or service, if your customers are delighted, the word will spread. You might have to encourage them a little, but sufficient quantities of awesome easily convinces customers by itself to spread the word.

Now, what if you took the money out of this funnel? What’s left?

Pretty much everything except the transaction engine. This is a key point for any amateur: virtually every metric leading up to a sale is the same for amateur and professional. If there’s nothing to buy at the end of the funnel, there is something else that requires a level of commitment that’s non-casual. It might be showing up at a rally or volunteering your time, but it’s something that in a commercial interaction would be the equivalent of putting money on the table.

If you don’t know what is the commitment substitute for commerce in your amateur efforts, you’ll never be able to measure your new media efforts in any meaningful way beyond eyeballs and ears. Decide what’s at the end of your rainbow if not a pot of gold, and then take all the pieces and parts from commercial exchanges and make them work for your passion.

Photo credit: Dairy Cow

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July 18, 2009
Rockstars of conversation

Last night I had the opportunity to attend Radian6’s Rockstars of Social CRM. Interesting event. The panel discussion was mostly on interaction with customers, but all of the side conversations throughout the night made it absolutely epic. Some highlights:

Talking with Olivier Blanchard about the ultimate evolution of social media and speculating what true mastery of communications looks like.

Geeking out with Dan York over yet even more new stuff about Google Wave, including rich media in Waves and Wavelets. Incredible. Stay tuned as he’ll have a video we recorded about what Wave will make possible that’s beyond our ability to grasp yet.

Chris Brogan going gangsta.

Talking with Chris Newton about some of the new back-end features of Radian6’s integration with Salesforce. Honestly, I’m not sure they even fully get what they’ve created, but if they’re both lucky and good, they’re going to manufacture a bucket of money. We’ll see if the idea discussed over dinner can turn them from a million dollar category business to a billion dollar category business. Let’s hope they do.

Hanging out with the Boston social media crowd.

The true power of events like this isn’t even in the entertainment or the presentation, but in putting lots of very smart people in one room and letting the chips fall where they may. Last night, as long as folks were paying attention and studying carefully what was being demo’ed, everyone was dealt a flush hand. If you were there, I hope you took advantage of the amazing conversations and know what the future looks like for the next 12-18 months in social media.

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June 25, 2009

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