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Industry Insights

Was “Big Data” a Big Deal in the 2012 Presidential Election?

One of the most surprising outcomes of the 2012 presidential election was the volume of–not to mention the velocity with which–the business and marketing press produced pronouncements about the marketing lessons to which those of us in the industry should pay particular attention. Front and center in most of the discussion continues to be one of the hot marketing topics of the day—“big data”—and the way both campaigns used it to make more data-driven marketing decisions than in any other previous election.

As Michael Scherer recounted in Time magazine, “From the beginning [Obama’s] campaign manager Jim Messina had promised a totally different, metric-driven kind of campaign in which politics was the goal but political instincts might not be the means.”

One of the few issues on which both parties could agree this year, Democrats and Republicans both admitted that their respective campaign organizations had far too many separate databases.

As an example, to quote Scherer’s Time piece again, during the 2008 election, “volunteers making phone calls through the Obama website were working off lists that differed from the lists used by callers in the campaign office. Get-out-the-vote lists were never reconciled with fundraising lists,” and so on. Not surprisingly, none of the databases could “talk to each other.”

The Obama campaign spent almost two years creating “a single massive system that could merge the information collected from pollsters, fundraisers, field workers and consumer databases as well as social-media and mobile contacts with the main Democratic voter files in the swing states.”

Not to be outdone, the Romney campaign also looked to better integrate databases in order to guide decision-making. “The Romney team, too, looked to harness unwieldy data sets and close the gap,” wrote Kate Kaye in AdAge.

Both campaign organizations did unprecedented amounts of precise targeting of messages and media buying. For instance, the Obama campaign developed a scoring methodology to rank order undecided voters in swing states based on their “persuadability.” Using internal databases, the campaign then determined the best ways to reach its audience with media and to influence behavior with messaging.

As a result, the campaign reported to Time it was able to “buy 14% more efficiently [than in 2008]…to make sure we were talking to our persuadable voters.”

According to Lois Beckett on ProPublica.org, the persuasion scores further allowed “the campaign to focus its outreach efforts and their volunteer phone calls—on voters who might actually change their minds as a result. It also guided them in what policy messages individual voters should hear.”

The Romney campaign did its fair share of message targeting to very specific audiences on- and off-line, as well. In Florida, for example, Antony Young, CEO of Mindshare, said, “the Romney campaign sought Cuban-American voters with hard-hitting TV commercials claiming Venezuelan President Hugo Chavez supported Mr. Obama’s policies.”

Both campaigns also seemed to be doing a large amount of message testing and performance tracking with all manner of fundraising and voter acquisition efforts on- and off-line, and used the data to inform marketing and message choices almost moment-to-moment. Young noted, “although all marketers listen to consumer responses, it was the speed and consistency with which both the Romney and Obama campaigns were able to respond that impressed me.”

He used as an example the multiple occasions Mr. Romney tested a message or storyline with a real audience at a campaign rally speech and “if it got a reaction from the audience, video spots would quickly follow online. If there was strong response online or pickup by cable news networks, the ads would appear on broadcast TV…all within a matter of days, often adjusting further as the campaign progressed.”

Obviously, we’d agree that using “big data” to enable more precise, effective, and efficient media placement, messaging, and outreach, a.k.a., “activation” in marketing parlance, is great and might very well be cutting-edge as far as political marketing goes. We’re a little hard-pressed to see how it’s incredibly different from what many companies are already doing or trying to do, be it to use data to make decisions in response to day-to-day shifts in marketplace demands, to micro-target messaging, to localize efforts, etc.

We’re not as sure as AdAge’s Kate Kaye who asserted that “corporate brands could learn a thing or two,” from the campaigns’ applications of “big data,” “whether it’s how data can incite speedier decisions, or ways offline info can benefit online messaging.” It sounded like the campaigns often were integrating data from a variety of sources—not a bad thing by any means—but somehow didn’t exactly sound like it qualified as the processing, analysis, and “curation”—a term we’re hearing almost every day now—of large and complex data sets that we usually associate with “big data.”

It may be true that “in politics, the era of ‘big data’ has arrived,” as Time’s Michael Scherer concluded. At the same time, it’s also hard to say that either campaign was exactly breaking new ground in this area within the marketing world.

As a case in point, nowhere in all the data discussion was much of an indication that “big data” was driving the “big picture” marketing strategy of either campaign.

For instance, the Obama and Romney campaigns appeared to target the core supporter and demographic groups on which the respective political parties have typically concentrated. “Women, Latinos, young people, and blue-collar families in the auto industry,” were among the Obama campaign’s targets, as Elizabeth Wilner wrote in her AdAge summary piece. “Big data” perhaps improved the effectiveness and efficiency of communication and get-out-the-vote efforts, but near as we can tell these were still pretty traditional targeting decisions driven as much by experience and past voter behavior than anything new coming out of “big data.”

To the extent that either candidate had a clear, consistent, definitive, over-arching positioning, it’s hard to say that the positioning decision was shaped by “big data” either.

Romney, for example, continued to employ his “the candidate with real business experience” positioning which he’d used in previous presidential, gubernatorial, and senatorial campaigns—with mixed end-results, we might add—as opposed to something that came out of a new insight gleaned from the integration and analysis of voter, fundraising, media, and consumer databases.

Certainly there’s no arguing that the more information a campaign has about individual voters’ on- and off-line media habits, voting behavior, location, attitudes, demographics, etc., the more precisely it can reach and motivate them. Campaigns—particularly for national office—are expensive propositions and there’s every reason for campaign organizations to make sure they get the most out of every dollar they invest in marketing a candidate.

Nor is there much doubt that the easier it is for a campaign to find and identify individual voters and/or people similar to them in different databases, the more integrated and adaptable the organization and the better the performance of marketing efforts will most likely be.

In and of itself, however, “big data” isn’t necessarily going to make or break a campaign—political or otherwise. As Mike Zaneis, general counsel of the Interactive Advertising Bureau, quipped, “big data isn’t going to help Todd Akin,” referring to the disgraced Congressman from Missouri who lost his Senate campaign after claiming women can ward off pregnancy resulting from “legitimate rape.”

In other words, many factors go into the success or failure of a candidate’s bid for office; an exceptional data-driven marketing campaign–as sophisticated and impressive as its back-end data warehouse might be–is but one of them.

Marketing Cartoon

Illustrated by C. Madden

Copernican Exploration

Interview with an Expert: Kevin Clancy on Priming the Pump for Loyalty with Targeting and Positioning

According to IBM’s Global Chief Marketing Officers study, the absolute TOP priority for for CMOs “is to enhance customer loyalty and encourage satisfied customers to advocate their brands.” Most marketers also agree that fostering loyalty among current customers and motivating advocacy behaviors is primarily an untapped opportunity to improve profitability.

Certainly there’s plenty of evidence to suggest there’s something to that line of thinking. The American Customer Satisfaction Index, for example, reported that the cross-industry satisfaction average hovers around 76%—a “C” grade—and hasn’t budged for two years. The lower the level of satisfaction, the higher the likelihood the customer won’t purchase the brand again. Not surprisingly, a Bain Consulting study found the average company loses 20-40% of its customers every year.

Unfortunately, many marketers aren’t sure what to do about the problem. The same IBM CMO study reported that most CMOs feel under-prepared to deal with decreasing brand loyalty.

We asked Kevin Clancy, chairman of Copernicus, for a strategic perspective on what marketers can do to foster loyalty to their brands. Here’s what he had to say….

Mzine: Many companies seem to have ongoing struggles with maintaining and growing loyalty to their brands. Obviously there are many potential contributing factors, but to your way of thinking, what are some of the major ones?

Kevin: In our work with B2B and B2C brands in a variety of industries, we’ve discovered that poor targeting and lack of a consistent, compelling positioning are major reasons why many companies struggle to connect customers to their brand.

There are some people who–no matter what a marketer says or does–are just not interested in a particular brand. They wouldn’t take it for free. It’s going to be an expensive and maybe even impossible proposition to try to convert them from a completely disinterested buyer to a loyal customer.

Still, it’s not an infrequent occurrence to hear a company declare plans to target non-users of their brand without any indication that they know how many non-users are even open to switching or giving some share of their requirements to the company’s brand.

Just like if you’re on the wrong train, every stop is the wrong stop, if you start with the wrong target, it’s going to be a challenge to get where you want to go as far as growing loyalty.

Mzine: What’s the connection between a strong positioning and growing loyalty?

Kevin: Establishing an emotional connection between their brand and target consumers is something marketers talk about a lot. Interestingly, when Copernicus asked consumers about the “personal or emotional connection with their preferred brand” across a variety of product and service categories, less than 10% on average claimed a “strong” connection. Just 20%-25% of consumers on average reported even a moderate emotional connection to a brand.

While it did appear an emotional connection was more readily formed in certain product categories because of the innate characteristics of the category, generally speaking, it’s up to marketers to encourage and help forge those higher-order bonds between their brands and the people who use them. One of the best ways marketers can do that is by solving customer problems with products or services.

A criteria we suggest marketers consider when assessing the potential profitability of different market segments is the size of the problems buyers in the group have that brands in the category or industry can solve with products and services. We have found time and time again that the bigger the problem a marketer can solve, the bigger the market response.

Carrying that thinking forward one more step, the bigger the problem on which marketers base the positioning strategy for their brands, the bigger the market and emotional response.

Mzine: Do you think companies are currently focused on the right things when it comes to growing loyalty to their brands?

Kevin: We have sometimes observed a tendency among senior management to get preoccupied with a metric—more often than not the Net Promoter Score—and improving it rather than focusing on what the barriers to loyalty are among current customers and doing something about them.

A brand’s Net Promoter Score, of course, is calculated by asking people on an 11-point “recommend” scale the “ultimate question:” how likely are they to recommend the brand to a friend or colleague? The scale runs from zero (“definitely would not recommend this brand”) to 10 (“definitely would recommend”).

People who score 9 or 10 are labeled “promoters”; people who score 0-6 are, in turn, labeled “detractors”; the 7’s and 8’s are ignored. Subtract the percent of detractors from the percent of promoters and you have the “net promoter score.”

While it’s not a bad metric, it’s only one behavioral measure of the far more complex concept of “brand loyalty.” Same can be said for fans on Facebook, followers on Twitter, and so on—they are but one measure and don’t offer much in the way of prescriptive guidance on the most profitable ways companies can improve that measure.

We’ve also sometimes found a tendency to hone in on a program that will encourage loyalty. I have no less than eight different “rewards” cards from different stores I go to on my key chain, for instance. How well those programs work in terms of achieving increasing levels of loyalty, however, is more a reflection of the strategy on which they are based.

And that’s the real ultimate question marketers should be asking: how do you integrate growing loyalty into your marketing strategy to take advantage of this untapped opportunity? Marketers that have focused on taking a more comprehensive view of growing loyalty—that it’s about targeting the right people, with the right message, with the right kinds of campaigns, programs, and experiences with the brand—have seen the greatest success in this area.

Mzine: Can you give some examples of companies that have done that?

Kevin: Everyone seems to cite Apple and certainly it’s a ready-case to point to in order to demonstrate the effect of developing and maintaining a strong, loyalty-inducing positioning.

It did it by solving a pretty major problem consumers were having with PCs—they were frustrating and sometimes incomprehensible to use—by offering a product that was the exact opposite—user-friendly and easy to use. One of Steve Jobs’ many claims to fame was his religious focus on making Apple’s products “plug and play.”

The company stayed razor-focused on that positioning and pretty consistently delivered on it. It was/is easy for customers to love Apple and have those feelings develop into heightened levels of loyalty that are the envy of the business community.

In recent years, McDonald’s by all appearances has very effectively targeted parents and families by positioning itself as the brand with something every member of the family can love. The chain has expanded and upgraded menu offerings to include something fun and tasty for the kids—with the promise of more reasonable, calorie-conscious portions—and more sophisticated fare for the folks.

In the opposite extreme—more of an anti-case—Avis Rental Car recently switched its long-standing positioning of “the brand that tries harder for its customers” to the brand that helps corporate travelers feel less stress and be more productive.

Sure, lots of stress and lack of productivity are two big problems business travelers have, yet it’s pretty unclear how the Avis brand does much to chip away at the problem with its services—it’s still just renting out the same kinds of cars offered by its competitors.

It’s not providing an actual solution to that big problem, and it’s the solution where the lovin’ feeling customers have for the brands they buy and use comes from.

Mzine: If you had the ear of every CEO and CMO for five minutes, what would you say to them about growing loyalty to their brands?

Kevin: When you chart out a model of how sales occur, it usually looks something like this: first a marketer approaches a target market, they build awareness, achieve distribution, stimulate trial, encourage repeat, foster loyalty, etc. Loyalty may come toward the end of the sales process, but marketers need to start taking the steps to build brand loyalty from the very beginning.

If marketers want to grow loyalty, there’s no better place to start than with the most important strategic decision there is: who to target. It makes little economic sense to invest marketing dollars in fostering loyalty among customers who are not profitable to a brand or all that likely to remain loyal in the first place.

Once you have a target group, you need to figure out how you’re going to motivate them to consider your brand and do it in a way that fosters the kind of strong, positive feelings that enhance loyalty. Remember that an emotional connection is something that you have to work hard at building over time. It’s not something that comes from having a hip new logo or clever, funny ads…. It comes from providing products and services that consistently deliver something of meaningful value to a customer.

Marketers who take the time to learn more about problems target customers have that products and services in the category can feasibly and profitably solve and build their brand’s positioning around delivering that solution will have an infinitely easier time earning the long-term devotion and allegiance of target customers.

Again, loyalty isn’t something marketers only need to start worrying about after a customer has made his or her first purchase. Growing loyalty isn’t just a matter of finding the right reward program or return-visit incentive. A large part of success in this area comes from making strategic decisions that prime the pump, so to speak, for loyalty.

To watch Kevin’s recent webcast on this topic for the American Marketing Association visit: goo.gl/AsyAx

Discovery of the Month

Leave it in 2012

We recently stumbled across the #leaveitin2012 hashtag conversation and got a good chuckle out of some of the suggestions for things better left behind as we move into a new year. The acronym “YOLO,” swag, the band One Direction, girls making their eyebrows look like they were sponsored by Nike, and the Kardashians, to name a few, each got a good-sized number of mentions on this micro-meme.

We didn’t see too many business, or more specifically, marketing-related suggestions–the spirit of this particular Twitter discussion, as of this writing anyway, is clearly more cultural (i.e., catchphrases, reality TV and pop stars that many of us could do without) and personal (i.e., bad boyfriends, things that make you unhappy, saying “new year, new me”). Nevertheless, we’ve most definitely got our running list of business and marketing ideas, concepts, and practices that we’d just assume not see in 2013, beginning with our top pick:

The statement, “marketing is dead.”

We’ve read and heard more than our fair share of articles, blog posts, speeches, interviews, and discussion that have encapsulated the sentiment of this irritating sentence in one way or another over the years.

Whether announcing the death of traditional marketing, some aspect of marketing strategy such as positioning, or just marketing in general, those uttering the statement typically are expressing the disappointment many have with the current performance of existing marketing programs and the excitement about a new tactic, technology, or channel of communication that’s caught the attention of buyers in the category or industry and, therefore, the businesses trying to engage with them.

Bill Lee’s much-ballyhooed piece on the Harvard Business Review blog back in August, “Marketing is Dead,” stands as a case in point from 2012. Though, in spite of the title, the object of his ire is primarily traditional marketing communications, Lee’s piece is pretty representative of the mindset we’d just assume pass into the annals of history: if it’s not working as well or having the same effect it once did, it’s definitely because it’s no longer relevant and, rather than think about why, marketers just better pull the plug.

“Traditional marketing—including advertising, public relations, branding and corporate communications—is dead,” Lee proclaimed in his post. “Many people in traditional marketing roles and organizations may not realize they’re operating within a dead paradigm. But they are. The evidence is clear.”

He continued, “Several studies have confirmed that in the ‘buyer’s decision journey,’ traditional marketing communications just aren’t relevant.” His conclusion: “Buyers are no longer paying much attention [to traditional advertising].”

Let’s take a closer look at some of his points.

True, there’s plenty of evidence that many marketing programs and new products/services do not perform as well as they could or should. Still, it seems a little bit premature, to say the least, to conclude that advertising, pr, branding, corporate communication, and, heck, the whole practice of marketing in general are totally irrelevant to the business of selling goods and services today.

It’s a fair statement that the explosion of digital, social, and mobile communications has improved the accessibility to a vast array of information about brands, products, and services and has forever changed where, when, and how companies reach and communicate with customers. While it’s entirely possible that in some cases for some brands, the digital revolution may have had some negative impact on the effectiveness of traditional advertising campaigns, companies should not automatically presume that traditional forms of communications have been rendered entirely ineffectual.

Keep in mind there could be many potential contributing factors to disappointing performance. Perhaps, for instance, the strategy, plan, and tactics used were not appropriate given the firm’s marketing objectives. It could have been a flaw in the strategy on which the tactical plan or a campaign was based; inefficient spending; or some combination of both.

As our chairman Kevin Clancy is fond of saying, “a body brought in from the cold is not necessarily dead.” It could be that how traditional advertising is used by a company in the future will change, but until a marketer determines for sure that his or her customers aren’t paying attention to it; gets a little closer to the bottom of why not; and figures out how and when it could be better deployed within the context of the consumer journey, it should not be declared dead on arrival.

In fact, there’s a growing body of evidence that indicates some aspects of “traditional marketing,” may be worth a second look. Recent work done by Marketing Management Analytics (MMA), for example, demonstrated that for every dollar a consumer packaged goods (CPG) company spent on traditional TV, print, and radio advertising, the return was negative and had declined over the past five years. Very importantly, however, MMA found the opposite to be true for non-CPG firms where the ROI of traditional advertising had markedly improved over the same time period—which, as an aside, happened to be when digital and social was exploding—and was highly positive.

eMarketer also reported that, according to a 2012 study conducted by Millward Brown and Dynamic Logic, “TV ads were the No. 2 reason smartphone and tablet owners turned to their mobile devices for actions such as brand searches, app downloads or visiting brand websites or social networking pages.” Granted, as depicted in the table below, it ranked second to recommendations, but it would nonetheless seem that TV advertising played a pertinent role in generating awareness and interest in a brand, not to mention inspiring subsequent action.

Making statements like “marketing is dead” isn’t going to make it any easier to get people to buy a brand. It’s not going to encourage companies to do a thoughtful, more comprehensive evaluation of marketing objectives and activities to figure out what’s working, what isn’t, why, and what to do to improve effectiveness and profitability. It’ll be a better year for marketers all around if we just leave it in 2012.

What We’re Reading

Our Top 3 Reading List from Brand ManageCamp

Several weeks ago, we had the honor of once again participating in the Brand ManageCamp conference, which had one of the most unique and compelling agendas we saw this year. Promising “fresh thinking,” every year ManageCamp features speakers on a wide range of business, management, and marketing topics.

As some background, Copernicus has been involved with Brand ManageCamp since the conference first began. Over the years, Kevin Clancy and Peter Krieg, chairman and CEO respectively of Copernicus, have served as keynote presenters; Kevin organized and moderated a panel on improving marketing ROI; and we’ve also signed on as a sponsor of this truly thought-provoking event.

Back to the matter at hand, one of the things we really like about this conference is that most of the speakers have books out on their respective topics. As a result, their presentations served either as good overviews of their thinking or more in-depth discussion of a particular issue covered in the book.

We came away from the conference with a long list of books to pick up, three of which top the list:

Touchpoints: Creating Powerful Leadership Connections in the Smallest of Moments
By Doug Conant (Jossey-Bass, May 17, 2011)

With getting the right organization in place and inspiring employees to serve as brand ambassadors for their brand becoming an increasing preoccupation for CMOs these days, who better to learn from than Doug Connant, who, as CEO of Campbell Soup, was able to take employee engagement from the worst in the Fortune 500 to among the best.

Brand Harmony: Achieving Dynamic Results by Orchestrating Your Customer’s Total Experience
By Steve Yastrow (SelectBooks, May 1, 2010)

We liked the idea of “elevating the concept of integrated marketing,” which Steve Yastrow talked about during his presentation. Given the crazy number of choices marketers have with which to communicate to customers, this notion of thinking through the individual and incremental role different types of programs, campaigns, etc., play in delivering an experience with the brand is a good one to keep in mind.

Jugaad Innovation: Think Frugal, Be Flexible, Generate Breakthrough Growth
by Navi Radjou (Jossey-Bass, April 1, 2012)

We’re always interested in learning about new approaches to generating ideas for new products/services, so Navi Radjou’s presentation at the conference grabbed our attention. We’re looking forward to reading more in his book about the process and examples he shared at the conference.

Buy on Amazon

Coming Attractions

From the Copernicus Marketing Genius Series^TM: Measuring & Motivating Brand Advocates–Download Now!

In Measuring & Motivating Brand Advocates: The State of the Science, Copernicus’ Kevin Clancy and Eric Paquette explore how marketers have successfully built a superior base of knowledge about their Brand Advocates to create a true competitive advantage.

It’s true that marketers have always loved Brand Advocates—a group Kevin and Eric define as consumers who not only use a brand, but also love it and want to help others get to know it—because they help to build awareness, positive perceptions, and trial of brands. In recent years, this group has taken on even greater importance to marketers.

In general, consumers have grown more skeptical of advertising and have placed greater emphasis on recommendations of their friends, family and other consumers. At the same time, the proliferation of digital technologies has given Brand Advocates the tools to quickly and effectively reach networks of their friends and other consumers.

Social networks, blogs, video-sharing, review sites and other digital tools make it much easier and more effective for Brand Advocates to share their knowledge of and their experiences with their favorite brands than even a few years ago.

As Kevin and Eric write, while few would argue about the perceived potential of Brand Advocates to help brands with marketing and sales, “the bigger and, naturally, harder question for marketers to answer is how ‘real’ is the group’s value? How much—if any—time and resources should go into engaging and broadening relationships with Advocates on- and off-line?”

They continue, “It goes without saying that there are many potential targets for marketing efforts to choose from and companies looking to get the most out of their increasingly precious marketing dollars want to make the most effective and efficient decisions.”

In their ebook, Kevin and Eric describe how many marketers have developed an in-depth understanding of the size and scope of the profit-enhancing opportunity Advocates hold as a group for their individual brand based on a big-picture perspective of:

• Who they are
• How many are there
• How do you identify them
• What is the best way to communicate and motivate them
• How do you integrate this knowledge into the brand’s overall marketing strategy

Download Measuring & Motivating Brand Advocates: The State of the Science for free now.

AMA and Copernicus Launch Seven Habits of Highly Successful Marketers Podcast Series

The American Marketing Association (AMA) and Copernicus have kicked off an on-going podcast series, “The Seven Habits of Highly Effective Marketers.”

As some background, our senior consultants sat down recently to compare notes and experiences from their many years of behind-the-scene observations of marketing organizations at work. They discovered that the marketers who achieved heightened levels of program effectiveness and, very importantly, brand growth, tended to follow similar practices and patterns when it came to making better, more profitable decisions in key strategic areas.

Inspired by the late Stephen Covey’s recommendations for improving personal effectiveness, they developed a list of seven habits of highly effective marketers:

• Habit 1 - Get your bearings and set clear, effective marketing objectives
• Habit 2 - Challenge conventional approaches to targeting
• Habit 3 - Take a stand–make your brand stand for something
• Habit 4 - Invest in early implementation planning
• Habit 5 - Select the most profitable product, not the most appealing
• Habit 6 - Apply big picture shopper insights all along the path to purchase
• Habit 7 - Embrace a continuous improvement approach to planning

The AMA suggested offering a series of podcasts to provide listeners with a deeper understanding of each of the seven habits and techniques for making them standard protocol in their marketing organization.

And here we are. Read more about the series and download the first four podcasts in the series at: marketingpower.com/ResourceLibrary/Pages/the-seven-habits-of-highly-effective-marketers.aspx

Download the a printer-friendly version of vol. 2. 2012