Marketing White Belt: The Marketing Funnel

Posted by Christopher S Penn on Mar 16, 2011 in Advertising, Marketing, Metrics, Strategy, White Belt | 3 comments

If there’s a more time-honored concept in marketing than the funnel, I don’t know what it is. There are more variations on the marketing funnel than virtually any other model as well. The marketing funnel is elegantly simple: illustrate the different stages that people go through to become customers. Most marketing funnels are based off the 1898 AIDA concept promoted by St. Elmo Lewis.

The AIDA funnel has four basic stages:

• Awareness, when someone becomes aware of your product or service.
• Interest, when someone becomes interested in learning more about your product or service.
• Desire, when someone wants to buy from you.
• Action, when someone buys something.

The tricky part of Lewis’ AIDA model is that it expresses verbs or actions that someone takes, which makes it difficult to measure effectively. If you make a funnel of the nouns that are implied by Lewis, you get something like this:

Audience: the number of people you have access to that are potentially qualified to buy your stuff. For example, if you sell college textbooks, there won’t be that many folks under the age of 16 interested in your wares.

Audience becomes aware of you and turn into…

Prospects: the number of people who identify themselves as being in the market sooner or later for your goods and services. For example, these are the people who follow you on Twitter and visit your web site from an organic search query. They are self-identifying as people who want to hear what you have to say. They’re shoppers, shopping for what you have to offer.

Prospects become interested in you and become…

Leads: the people who raise their hand and engage you to begin the purchase process. This might be something as casual as signing up for an email list or as dedicated as filling up a shopping cart (real or virtual) with stuff.

Leads express their desire and take action to become…

Customers: the people who choose to give you their money in exchange for your goods and services.

One area where Lewis falls flat is what happens after someone becomes a customer. Enthralled with your fine quality and wonderful service, they become repeat customers, and more importantly, join your marketing team as…

Evangelists: your unpaid marketing force that refers people to you and can’t stop talking about you in a positive way.

By identifying the nouns, the people, in Lewis’ model, we have something to measure a little more objectively and cleanly. You can now take all of the data and analytics information you have access to and start putting it in buckets that you can measure. For example, you can use Google Ad Planner, Facebook ads, and social media monitoring tools to identify audience pools, then plug in Google Analytics traffic data for your prospects, the people who stopped by. Turn on goal and conversion tracking in Analytics and you can measure leads. Depending on your business model, you might even be able to track sales, but if not, your CRM will measure sales and customers. You’ll then head back to Analytics to measure your evangelists, as well as social media.

Don’t throw Lewis’ model away, however! It still provides tremendous value. Something that Ken Savage, owner and head instructor of Winchendon Martial Arts, admonishes us frequently is that if part of a technique is failing, head back to the previous step and fix what you broke there, since mistakes tend to cascade. By keeping Lewis’ verbs in place, you know exactly what actions your audience are or are not taking, and can take appropriate steps to fix them.

For example, if prospects are not becoming leads, they are not expressing interest in you. Why is that? Is there a conversion mechanism on your site that’s broken? Is there an unclear or absent call to action? By keeping the verbs around, you can diagnose what actions aren’t happening and repair them quickly to get people moving through the funnel smoothly again.

Finally, keep in mind that these funnels are only examples. If your business operates differently or has different goals in mind, you can draw your own funnel using this structure. As long as you can ensure that each stage can be accurately measured, nearly any funnel model can work for you. The basic template is:

• Bucket of people
• take an action to move into the next
• Bucket of people
• take an action to move into the next
• Bucket of people
• etc.

Draw that out, assign metrics and tools to each bucket, and you’ve got a marketing funnel that will work for your specific business.

If you enjoyed this, please click here and share it with your network!

Want to read more like this from Christopher Penn? If so, please subscribe right now!

Click here to read my blog on Google Currents on your mobile!

Marketing White Belt Basics for Digital Marketers is now on Amazon & B&N

Watch me speak: Attend virtually!

I recommend: for Twitter audience building.

Marketing White Belt: The SWOT Analysis

Posted by Christopher S Penn on Mar 15, 2011 in Advertising, Marketing, Strategy, White Belt | 2 comments

For the past 40 years, strategists have used a model created by Albert Humphrey of Stanford University called SWOT to determine how achievable a business objective is. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats.

SWOT is a deeper analysis than it first appears when it’s explained to you. It can be a powerful tool for understanding your business, your marketing, and your overall strategy for any given objective, whether it’s dominating Twitter in your niche or cornering the market in your industry. Let’s walk through each of the components.

It can, in fact, be done on a napkin.

First, SWOT is broken up into two categories, internal characteristics and external factors. Strengths and weaknesses are internal characteristics of your company or team that give you advantages or disadvantages. Understanding this half of SWOT alone can do wonders for your business, as it requires a great deal of mental flexibility. Any attribute of your company or team can simultaneously be both.

For example, let’s say your company is a small company. Nimbleness and agility in the marketplace are strengths, but lack of bench depth and resources are its weaknesses. Or, let’s say your company has chosen an intern to run your Twitter account. The strength of this approach is very low cost, but the weakness is that the intern probably has no idea how to manage your brand.

Internal characteristics are important because they are largely under your control. You can enhance a strength or mitigate a weakness by your choices. If you feel, for example, that a mobile strategy is an important area that is currently a weakness, you can train or hire someone with that skill set and make it a strength, an internal characteristic of your organization.

The second half of SWOT is a look at opportunities and threats. These are external factors that are probably not going to be in your control (or minimally so) and can impact your ability to achieve your objectives.

Opportunities are external events or conditions that can give you a market advantage. For example, if you banked on Foursquare becoming a dominant local marketing channel for your restaurant and became an early adopter, your investment may have paid off. If you foresaw the shift from metal to grunge in the 90s and hired new bands accordingly, you were able to seize the opportunity and profit from it. You had no control over the opportunity itself, but were able to ride the wave.

Conversely, threats are those external events or conditions that can disadvantage you. For example, the US government completely wiped out the federal student loan market a couple of years ago, making business for student loan companies extremely difficult. Craigslist has steadily depleted newspapers’ income by replacing their classified ads revenue with the free or almost-free Craigslist service.

Like strengths and weaknesses, opportunities and threats can simultaneously exist for a company. If you ran a flea market, eBay delivered a swift kick in the shorts to your business, becoming the dominant competitor in your industry and a major threat. However, it also created the opportunity for you and your vendors to sell to a global audience rather than a local audience. Instead of people looking for stuff for themselves and their houses, now flea markets are crowded with buyers and resellers who sniff out bargains and arbitrage them on eBay.

Conducting a SWOT exercise for yourself, your team, or your company is fairly straightforward. While you can do some very expensive, very complex analysis, the model equally lends itself to sitting down with a few folks, some drinks, and a few sheets of paper (or even a napkin). Let’s say you’re a social media consultant sitting down with a client. You’d divide up a sheet of paper (or run a mind map, or whatever) into four sections, then talk over each category. Here’s an example using a mind map of what a very simple SWOT might look like for a mortgage services company.

What’s often not discussed in SWOT analysis is the connection between the halves. Understanding your strengths and weaknesses is good and important, as is understanding your marketplace and competitive landscape. The next step after doing the basic analysis is to examine each opportunity and threat and determine how your strengths and weaknesses will impact each item.

For example, let’s say you’ve identified that you have outstanding customer service as a strength, but at the cost of a lack of scalability. The marketplace shows an opportunity for service-oriented companies to do well on Twitter. When you dig into your analysis to evaluate Twitter as a marketing channel, you recognize that you can capitalize on your service abilities to deliver the same great service on Twitter. However, you also recognize that as your company grows, you simply can’t scale the number of people needed to manage Twitter for your company. Now you have an idea of how your strengths and weaknesses impact this opportunity.

Another example, let’s say you’ve identified that you have great technical agility but all of your digital assets are tied up in your niche’s SEO. Maybe you make carbolic smoke balls and the government is about to outlaw your core product entirely. You understand the threat, so you need to mitigate your weakness – locking yourself into one brand and product – by diversifying and getting new web sites up and running (and ranking in search engines) very quickly.

Finally, one of the most important areas where people go wrong with SWOT analysis is confusing the internal and external. I’ve seen MBAs with wonderful degrees from top shelf business schools screw this up royally, so don’t feel bad if you don’t quite get it down on the first run. Internal are factors that you have control over. External are factors you largely don’t have control over. If you’ve mixed up the two, chances are you just need to rephrase and reframe the external as an internal factor.

For example, let’s say you think a strength of the company is a #1 keyword ranking in Google. That is clearly an external factor – if Google changes its algorithm, tomorrow you might vanish in the search engine listings. However, what got you to be #1 in Google was a team that can generate great content and solicit links from A-list bloggers to your content. That’s an internal factor, something you have control over, which in turn means it’s something you can change if the external factors change. If Google rearranges its algorithm and goes from an opportunity to a threat, you can refocus your strengths to mitigate that threat and transform it back to an opportunity.

I hope this explanation of the SWOT analysis is useful to you in your white belt marketing training. SWOT, properly used, can be an incredibly valuable tool in your marketing toolkit for making decisions, setting strategy, and evaluating courses of action.

If you enjoyed this, please click here and share it with your network!

Want to read more like this from Christopher Penn? If so, please subscribe right now!

Click here to read my blog on Google Currents on your mobile!

Marketing White Belt Basics for Digital Marketers is now on Amazon & B&N

Watch me speak: Attend virtually!

I recommend: for Twitter audience building.

Marketing White Belt: The 4 Ps of Marketing

Posted by Christopher S Penn on Mar 14, 2011 in Advertising, Marketing, Strategy, White Belt | 5 comments

One of the earliest lessons I learned from my master teachers Ken Savage, Mark Davis, and Stephen K. Hayes was that in order to develop wisdom, you need an even balance of theory and application. Theory provides you with models, frameworks, forms, and methods to learn. Once you’ve gained competency in the basics in their textbook formats, you learn to apply them. You try them out, take them apart, vary them, and see how they work in application. After learning form and variation over a very long period of time, you transmute them both into experience and wisdom.

Martial artists and marketers tend to go wrong in similar ways when it comes to understanding how these two broad concepts work. Some folks think that theory is useless, that all you need to do in order to be effective is just put some gloves on and get into the ring, to wing it and hope. Other folks think that application is just a polite word for chaos and incompetence, deriding its lack of structure and “purity”. Both limited points of view are, of course, are wrong.

Generally speaking, you need to start with theory, with models, with something to hang your hat on. Knowing what a house should look like and how it should function is generally a better place to start than simply nailing together wood beams and hoping it turns into a place to live. So for this week on the blog, we’re going to look at some of the basic frameworks and ideas that make up marketing theory. Like white belts in the dojo, don’t expect these frameworks to instantly revolutionize your social media or marketing efforts without extensive application and trial. Like white belts in the dojo, don’t rush into social media or marketing, hoping you’ll just learn it magically along the way.

Marketing Mix, or the 4 Ps

The most basic framework in marketing is the 4 Ps. Here’s how it breaks down:

• Product
• Price
• Place
• Promotion

Let’s review these basic components:

Product. This is the thing that you want to sell to people. It can be a book, a service, even an emotion. Everything that provides value is bundled up in product, from packaging to features & benefits.

The most common mistake made by companies? Attempting to use marketing to fix a product problem. The bottom line is that if your product sucks, if your product is something that no one wants or needs, you won’t develop growth. Yes, you’ll sucker a few people here or there into buying your stuff, but they won’t buy again and they won’t tell their friends anything positive about you.

Price. How much do you sell your product or service for? More broadly, how much value does your product or service deliver?

Pricing is its own science, but one of the key things marketers get wrong is failing to connect price to value, to the benefit delivered for a price. If, as an example, you’re trying to sell a financial service, and your price is $1 but your service delivers value of $4 for every $1 spent, then you can raise your price and still deliver value to your customers. Conversely, if your service costs $1 but delivers 50 cents of value, you’ve got a long death spiral ahead of you. Marketing can slow it down, but you’re still doomed.

Place. Where can someone get your product or service? This is a much trickier question in marketing now than it used to be. In the early days of the industrial revolution, place was simple. You went to a store to buy products. In the information age, place can be virtual.

One area that gets especially murky in marketing (and martial arts!) is that place also has a time component. Yes, you can market on Twitter or Facebook, but to make your marketing effective, there is also a time in a relationship you’ve built to do that marketing. If you understand place but not time, you still won’t get the results you want, even though you may be standing in the same place as a competitor.

Promotion. This is the mainstay of marketing, the part that has all the visibility and attention – rightly so, because it’s the part that generates the most results and the part that’s hardest to gain proficiency with. Promotion is telling the right people about your product or service’s very existence so that they can learn more about it and ideally buy it from you.

If you left off promotion, you’d have a marketing strategy known as “build it and they will come”, assuming that great product in the right place at a fair price will automatically attract qualified buyers. Nothing could be further from the truth in today’s attention-deficit world. Promotion is largely about attention – whose attention should you be getting, and how will you get it? Promotion is the heart and soul of marketing, and the part you’ll have to work hardest at to develop excellence in.

This basic framework, the 4 Ps, is a good place to see the biggest possible picture of your marketing efforts – what you’ll be marketing, where, at what price, and to whom. Once you understand this, you’ll be ready to dig into individual areas to accentuate strengths and firm up weaknesses.

We’ll continue with some more frameworks and marketing basics tomorrow.

If you enjoyed this, please click here and share it with your network!

Want to read more like this from Christopher Penn? If so, please subscribe right now!

Click here to read my blog on Google Currents on your mobile!

Marketing White Belt Basics for Digital Marketers is now on Amazon & B&N

Watch me speak: Attend virtually!

I recommend: for Twitter audience building.

Padcasting from the iPad and Garageband

Posted by Christopher S Penn on Mar 11, 2011 in Blogging | 3 comments

Garageband for the iPad came out in the App Store and I gave it a test, doing some “padcasting”. It’s a very polished interface, typical high quality Apple standards, but there are some gotchas. Watch more in the 2 minute video.

Mobile editing of audio is awesome for all podcasters, and you can interchange desktop Garageband projects with the mobile version (sync through iTunes), so if sound quality is important, record on the desktop with your awesome gear and then send the file to the iPad for editing while on the go.

The glitch in the video with the recorder coming to a dead stop was easily solved – my iPad was out of disk space. Make sure if you’re getting an iPad 2 to spring for disk space or you’re going to run out really, really fast.

If you enjoyed this, please click here and share it with your network!

Want to read more like this from Christopher Penn? If so, please subscribe right now!

Click here to read my blog on Google Currents on your mobile!

Marketing White Belt Basics for Digital Marketers is now on Amazon & B&N

Watch me speak: Attend virtually!

I recommend: for Twitter audience building.

Define your spaces and what you do where

Posted by Christopher S Penn on Mar 10, 2011 in Advertising, Marketing, Social media, Social networks, Strategy | 1 comment

If you truly want to provide value and compelling reasons for people to interact with you in different social channels, don’t just make them carbon copies of each other. Why like you on Facebook if it’s just a feed of your Tweets? Why connect on LinkedIn if you just cross-post from Facebook. To make areas more valuable, consider dividing up the social spaces you participate in by function and content. Some spaces will be obvious – you’ll post location data to Foursquare or Gowalla. But what will I get if I follow you on Twitter? What will I get if I Like you on Facebook?

Here’s how I do it. You should do it however it best suits your own workflow:

• LinkedIn. Mainly about the Marketing Over Coffee group there. That’s the juice on LinkedIn. Every day of every week, smart listeners are answering each other’s questions and submitting questions for the show. I also entertain myself by dropping the banhammer on spammers in there.
• Facebook. My Facebook page is all about tools and techniques. As I find useful things, I put them there as a way to catalog and remember them. If other people happen to like it and enjoy it, excellent!
• Twitter. You get #the5 on Twitter, along with in-the-moment conversations when I’m logged in.
• My blog. You get longer-form pieces here that don’t fit in other areas.
• My newsletter. Rounds up the pieces from all of these channels so that if you don’t want to have to follow me and friend me everywhere I go, you can just get the highlights every month.
• etc.

There’s another reason for managing your content like this, for dividing up the pieces. It’s a trick I learned from ninja master teacher Stephen K. Hayes: if you have information of value, split it up over a wide area and see who puts together all the pieces. See who completes the puzzle. Back in the day, An-Shu Hayes would publish individual pieces of knowledge in books, newsletters, live teachings, etc. and if you had the vision to see the big picture, you’d glue them all together. Some fellow practitioners would go so far as to photocopy his books and cut out all the text sections, then rearrange them all together to form one larger narrative about an area of practice.

That’s sort of the secret with how I divide up my content. Each channel, each platform is valuable, but if you have all the pieces together, your capabilities should be greater than the sum of the parts. Why do this? I’m always looking for smart people to hang out with. I’m always looking for people more clever than me, more informed than me, more connected than me, more capable than me because that’s the only way I’ll learn and grow. If I leave pieces all over the place, some people will take the time to reassemble the puzzle.

It’s those people I’m looking for, those people who follow and friend all the different pieces and are sewing them together, the digital marketing Voltrons, because those are the people who are more likely to have the sorts of problem solving skills and detective work abilities to be successful today – in other words, the kind of people I want to learn from and hang out with. That’s my personal ROI of all these platforms.

My content strategy shouldn’t be yours. It may not work for you at all, or it may be counter-productive. The lesson here for you is to do something other than blindly carbon copy your social networks – have a purpose for each one, because different people will interact with you on the different networks. Figure out what works best for each one!

If you enjoyed this, please click here and share it with your network!

Want to read more like this from Christopher Penn? If so, please subscribe right now!

Click here to read my blog on Google Currents on your mobile!

Marketing White Belt Basics for Digital Marketers is now on Amazon & B&N

Watch me speak: Attend virtually!

I recommend: for Twitter audience building.