Marketing and Sales: Closing the Great Divide

I'm excited to have been invited to speak at the Sales and Marketing Executives International event here in Boston on September 14th. The subject is a perennial favorite -- Marketing and Sales: Closing the Great Divide.

I'm interested in your views - over the last five years has the relationship between sales and marketing improved, grown worse, or stayed about the same? What causes friction? Leave me a comment -- or better yet, take 30 seconds to complete this three-question survey. 

I'll share results of the survey in a later post. Thanks!

The Science of Marketing?

Reading recent headlines and watching the gyrations of the stock market it’s easy to see why economics earned the epithet “the dismal science.” But is marketing any better? Indeed, is there any science to marketing at all?

Usually not.

Take social media as an example. Normally, marketing treats social media data in the same way that air traffic controllers treat blips on a radar screen – as signals that require careful help in landing, or emergencies demanding evasion on interception. The only difference is we marketeers attempt to land customers and intercept naysayers, rather than planes. Don’t get me wrong – marketing needs radar – but this hardly qualifies as science.

Data by itself isn’t science: Marketing pros usually have an excess of the former and very little of the latter. A scientific approach would require proposing a hypothesis to explain observations or ideas, then devising an experiment to test the hypothesis. It requires the rigorous definition of terms and ways of quantifying things. It demands objectivity.

Tom Webster gets at this distinction is his recent blog post, and argues that we’ll always need a mix of qualitative and quantitative information. It’s tempting to agree with Seth Godin and others and say marketing is both art and science, but this feels like a cope-out to me.

What we can say is that marketing is getting much more quantitative. This is a good thing. I can remember from my teaching days that marketing undergrads hated even the most rudimentary classes on quantitative analysis and statistics – today, they’d be well-advised to take these courses very seriously indeed. Science or not, the future of marketing will clearly move toward a more disciplined and measured approach. But the real gains will be with those organizations that go the next step, and apply more scientific rigor to their marketing investments.

Brand Potter: What Harry Can Teach us about Marketing

This month, at midnight, I took my daughter and a gaggle of her friends to the opening night of the final film in the Harry Potter franchise. Dressed as favorite characters – Luna, Bellatrix, McGonagall and Hermione – we arrived an hour before the show to find the movie theatre packed and transformed to a mini-Hogwarts. “Wingardiam Leviosa!” exclaimed our would-be Luna to the ticket guy, to which he responded brightly “Diffindo!” as he ripped the tickets. It was another world. And when we left the theater at around 3am it felt more like mid-afternoon on a busy weekend – the parking lot was packed and another crowd of Dumbledores, Snapes, Rons and Ginnys were piling in for the next show.

JK Rowling published her first book in 1997: Seven novels, 4,000 pages and eight movies later, Harry has become a pop-culture phenomenon unparalleled in modern times. A whole generation of kids – including my daughter and most of her friends and cousins, not to say her parents – have grown enthralled by a fully-realized world of magic. Commercially, the Potter phenomenon has no equal: Over 400 million books sold in every language imaginable, a worldwide movie gross over $7 billion, and even a theme park in Florida. How on earth did this tale of a boy wizard going to school become so successful?

There is no question that Rowling’s vision – and her near-flawless execution in her books – was the core of the success. She created wonderful characters, embellished her plot with great imaginative touches, and had a story in her mind that she knew would hold an audience across a decade of reading.

But Rowling did more than that. Famously, she demanded great control over all things Harry, from franchising to having full creative control over the movies and their scripts, even selecting actors. She also remained true to her readers – she was almost possessive of them – and communicated directly to young fans in her blog and elsewhere. My daughter talks about “JK” as if they’ve met recently and are close friends: This is remarkable. Rowling also embraced the runaway success that Harry enjoyed. She has said that Harry and his world felt almost independent of her, and there must have come a point where the pop-culture juggernaut also felt outside her control. Despite this, there is a fidelity to the world she created that has never changed despite the movies, the fanzines, the endless media hoopla and the passage of time. Among her many other talents, Rowling has expertly managed the Harry brand. Her focus and fidelity to a vision is something we all could learn from in marketing.

Marketing and Me

Last week, after three great years, I left my job running corporate communications for a large software company.

I was very fortunate – I left of my own accord, and I had plenty of time to think about the transition. Even so, I had two contradictory reactions to being gainfully unemployed: a feeling of delight at having oceans of time; and a feeling of mild panic at having no viable income. It’s hard not to oscillate wildly between indulging in projects and activities I’ve put off for years, then frantically job hunting.

I’ve worked almost all my career marketing, mostly in the high tech world but also for professional services firms and some consumer brands. In the last few weeks I’ve learnt that marketing feels very different when the subject at hand is You. Thinking about Brand You does a lot to focus attention on the fundamentals. Here’s some observations:

• Know Thyself!
  It’s easy to have an instinctive understanding of what your professional value is, but I found myself having to work hard to organize my search. What are my target markets? What is the current demand in that market? What’s my professional objective? What differentiates me from the many other candidates? Like any other marketing program, answering these fundamental questions is Step One.
  
• Resumes Revisited
  For many decades the basic tool – the promo piece – for advertising for work has been the resume. Nolonger. I’ve found that many conversations start because someone “found me” at this blog, because of press coverage I’ve appeared in, or via some other online imprint. Increasingly, our online resumes – our brand – is a diffused collection of activities. Managing these properly is critical.
  
• Networks and Friends
  The influence of word-of-mouth on brand perceptions is well understood, but the reality comes sharply into focus when you’re searching for work. A recruitment consultant told me that over 75% of jobs are found through an individual’s immediate network of friends, colleagues and family. We often forget that the same is true for how most people make decisions about what brands to trust and invest in.
  
• Social media works – and doesn’t
  A recent Pew Research study showed that fewer than 10% of “friends” on Facebook have never met in person. Social media is a wonderfully efficient way to maintain connections to our extended network of friends and colleagues, but it’s not so efficient at broadcasting beyond that network. Once or twice removed, the signal seems to get attenuated.
  
• Professional networking and career sites can work
  I’m using Ladders, LinkedIn, Indeed and the rest, and they are remarkable. One reservation – moving to a premium, fee-based service on some of these sites has only a marginal benefit. The basic service is often enough, raising questions about the business models for some of these companies.

One other thing – I’ve come to realize how much I enjoyed the ‘Company of Friends” I worked with over the last few years. Good luck to you all!

The Graying of Social Media

A popular myth about social media is that it's a fancy of youth, something endemic in the teen set but largely ignored by those well past their college years. If there was any doubt that this is a fallacy, read the latest Pew Research report.

According to their numbers, 47% of American adults have used some kind of social networking site, close to double the number recorded in 2008. The average age of users has shifted up from 33 to 38. On first blush this may not seem like much, but it's significant: Those 50 to 65 accounted for only 9 percent of social network users in 2008 and today they account for 20 percent of users. The numbers tripled for those 65 and over.

There's no question that the Early Adopters of social media were largely young, but we've long moved past the early stages of adoption. Social media is a part of the online landscape for most everybody.

What astonished a jaded marketeer like me was the response to the question “most people can be trusted.” Be honest – you'd expect a healthy majority to lean towards a “Nah” on this question – and indeed there is a majority, but far less than I'd thought. Forty-one percent of adults are trusting, and this actually increases slightly to 45% for social media users (non-Internet users are a gloomy bunch, with only 27% being trusting).


What emerges is that active users of social media are far more engaged, open and have more social support that non-users. Stating the painfully obvious, social media is about being social. It's about sustaining existing relationships (only 9% of Facebook “friends” have never met in person) and rekindling old friendships.

The implications for marketing pros are clear. First, the days when social media was a playground for consumer-facing youth brands are over. But we've known this for a while. What may be more important is that social networks are focused around trusted relationships that preexist. For marketing to engage with these close-knit communities will require creating a persona – a brand – that can feel familiar, that is already a part of the extended social network, and that can instinctively be trusted.

Viral Marketing and the Short Tail

Viral marketing has very little to do with marketing – or so I argued in my last post. I also suggested that we've done a pretty poor job of defining what the term “vital marketing” even means.

Being viral is mostly a function of a product or idea, not of the tools and tricks employed by marketing pros for promotion. That said, being viral is also about the vectors that transmit and pass on information about the product or idea – that is, the people involved. Said another way, certain people are receptive to an innovation, others are not. And some people are better equipped to retransmit and amplify the viral effect – the are better connected themselves, and better respected – and are thus more coveted targets for viral marketing.

This all has echoes of an old mass communications theory – adoption of innovation, championed by Everett Rogers. He's the guy that gave us familiar terms like Early Adopter and Late Majority to describe groups of people that characteristically are receptive to new ideas and are viewed by others as trusted sources of information.

Many of the today's models for viral marketing focus on the medium – Twitter, Facebook and so on. This is a mistake. Some enlightened folks start by looking at the product or idea itself. Very few also consider how audience targeting can influence viral marketing.

There's a lot of chatter in marketing circles about long tails – a statistical reference to the fact that the total sales of relatively unpopular items often outweigh the combined sales of very popular blockbuster items. An oft-cited example is book sales at Amazon, where cumulative niche sales of The Bagpipe Maintenance Book and its ilk far outstrip Potteresque blockbusters. If the warehouse and distribution costs can be managed, then marketing to the long tail can be very lucrative.

The reverse logic applies to viral marketing – we are short tail marketing. To see what I mean, consider the frequency distribution of Twitter followers, Facebook 'friends' and Facebook 'likes', all of which are more-or-less classic power distributions (that is, the kind of distribution people refer to when they think about long tails and marketing):

Ask yourself: who do you want to target when you consider attempting viral marketing? The answer, of course, is the most influential, and all other things being equal this equates to the very few people with the most followers, likes or friends – the short beginnings of the distributions in the graphs. (This effect is also self-fulfilling – we tend to crowd around the already crowded, follow those that have a lot of followers. We see this effect in social media and we see it in high schools, politics and the entertainment industry.)

Of course when I say we should target based on influence I'm stating the very obvious, but this all seems lost on many marketing pros when they think about viral marketing and new media.

The arguments get even more complicated if there's any real audience targeting to be considered. The undifferentiated masses that haunt social media aren't a target for anyone unless you happen to have a social media product to hawk. For the rest of us, we're interested in influencers and buyers, and we usually have some ability to describe these folks in at least broad demographic ways. Virality only matters if it impacts these few. But even if we're interested in created gross awareness we should think about the short tail.

What is Viral Marketing?

When we think of cloud computing we don't envision winged mainframes sitting angelic on fluffy cumulus, yet too often in marketing a clever metaphor morphs into a definition, leaving behind empty buzzwords. Such is the case with viral marketing.

What is viral marketing really? Go to Wikipedia and you will leave none-the-wiser; the page has become the battleground of an ongoing dispute about who originated the term, but provides little insight into what it really means. Other attempts at a definition vier off at two tangents – either getting lost in epidemiology or waxing rhapsodic about social media. Or we revert to the “I know when I see it” school, which ladles out a stream of ex post facto cases-in-point that illustrate the effect without enlightening us about what is taking place.

Arguably viral marketing is nothing new. If you look at early research into the effects and efficacy of propaganda, the mechanisms by which mass media impact ideas, or the ways that innovative ideas are adopted, they all suggests ways that messages and ideas are disseminated through a population. The concept of viral marketing is really a restatement of these old theories, adapted to the new communication tools of today.

A good theory and definition of viral marketing would provide an explanation based on observation, experimentation, and reasoning. It could be tested and confirmed and would help explain and predict the way some markets work or how some products become popular. It would build on what we already know from propaganda, mass media and public relations. What we've got instead is a lot of sound a fury every time a YouTube video gets a boatload of views, without any reasoning or insight.

At least, that's what I thought until I came across this blog post by David Skok. David applies some simple math along with a useful concept – the K factor – and provides an abstract model of how viral effects work. He also derives some very useful variables to consider, and some principles describing what makes viral marketing viral. To take one example:

Virality is not a marketing strategy that can be executed by the marketing department. It has to be built into your product right from the beginning. This is a function that needs to be thought through by the product designers and developed by the engineers.

This is not how most people think and at first it appears counterintuitive, but he's right. Marketing may play a role in amplifying a viral effect, or reducing the time cycles on virality, but it can rarely be the prime mover in making a product “go viral.” There really is no substitute for a good idea well executed.