Twenty-Seven: Accountable Marketing
In the scientific community, experiments are not done at random. They generally begin with a theory, form a hypothesis, and test it. The results of the test support or contradict the theory, likely not perfectly, such that the theory or hypothesis is modified and the process is repeated until satisfactory results have been achieved.
Likewise, persuasion is not random: you do not (or at least should not) blabber a random stream of words at a prospect and hope that they will react positively. Persuasion is based on a body of knowledge, which can be applied skillfully. This is the reason some salespeople far out-produce their peers, and why they recognize quickly that a suggested sales tactic isn't even worth trying.
Return again to the three basic questions of persuasion:
- What is the action we want someone to take?
- Who are we trying to persuade to take the action?
- What does that person need in order to feel confident taking that action?
There should be a clear and logical answer for each of these questions. Particularly for the third, a theoretically sound proposition must be applied, and you should be able to make a reasonable and logical connection between imparting information and eliciting the desired response.
Ultimately, marketing is held accountable for results: the cost of a campaign must be repaid by an increase in revenue as a direct result of the campaign - and before taking action, there should be a reasonable consideration of whether there is a likelihood that the money is spent productively.
Optimize Intelligently
In breaking down a buying process into a series of granular steps, there is the danger that we will become distracted by the data, and begin chasing after numerical improvements in metrics that do not result in actual revenue.
Consider the example of brand awareness - a prospect cannot purchase something he is unaware of, and so it is a valid goal of marketing to finance promotional campaigns that build awareness. But there are many instances in which improving awareness is unlikely to result in sales (e.g., making men aware of a brand of mascara), and improving the awareness of a brand among non-customers is not likely to have a corresponding impact on revenue.
Likewise, it is possible to improve interactions and messaging that are not significantly correlating with sales - so when optimizing plans, it is critical to first begin with an analysis, or at least a reasonable consideration, of whether the evidence pertaining to a specific action is at all significant to the ultimate goal.
There is also the point of diminishing returns to consider: when an action that is initially productive in increasing revenue is repeated, it eventually ceases to produce a sufficient increment in revenue to justify its costs.
(EN: This goes on a bit, clutching at various straws, but the point is made.)
A Six Sigma Perspective
The author makes specific mention to six-sigma, which was fashionable at the time the book was published. Essentially, it follows Deming's model of quality, based on the premise that all activities can be reduced to a simple process that can then be analyzed to determine what is or is not working.
In such a system, every customer who falls out of the sales funnel is a "defect" and the amount of money spent on attracting them and sustaining them up to the point that they dropped out is "waste" because it did not result in revenue. The ultimate dream of marketing is to target only those customers who will buy, and spend only as much in pursuing them as it takes to ensure their conversion, and top do this with 99.99966% accuracy - or 3.4 defects per million.
(EN: The ideal of six-sigma is seldom achieved in reality: firms that do so have often defined a very vague metric or something that is very easily accomplished. For example, an airline claims six-sigma success based on passenger fatalities - but would not fare so well if they applied six-sigma standards on flights completed rather than cancelled, on-time performance, or other factors that matter to the customer. It's also noted that many firms find they can achieve 99% accuracy fairly easily, but spend so much on incremental improvements toward the six-sigma goal that it becomes unprofitable to pursue. However, even though it is an unreasonable goal, six-sigma remains a good methodology for achieving improved, if not perfected, results.)
There are a few loose suggestions for applying six-sigma methods to the marketing process as a means to improve its efficiency and the quality of results.
A System for Prioritizing
Whatever system is used, it is important to measure marketing activities to assess their performance and identify opportunities for improvement. In particular, metrics can be helpful in identifying the activities that have the greatest effect on revenue so that they may be prioritized.
It's briefly mentioned that "quality" for the firm is measured in revenue, but from the customer's perspective, their refusal to convert is generally based on a perceived lack of value, trust, security, or relevance - so while methodologies such as six-sigma are internally focused on practices and processes within the organization, succeeding at marketing must be externally focuses to the expectations and desires of the market.