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In my working life, I’ve had ringside seats to the systemization of at least 3 distinct corporate functions: finance, sales and now the marketing function.
I remember going into meetings with CFO’s in various types of companies when I was starting out. The conversation would often go something like this, “Yes, I’ve heard about these “Accounting/Finance Packages” vendors are selling, but, no, they won’t work for us because our company/industry/whatever is too unique to use a standardized package.”
Fast forward 10 years. I remember sitting with a group of VP of sales and they all were saying, “Yes I know some of my sales guys are using these PC-based sales tracking tools but they really are just glorified contact managers. I can’t see how this can help me manage my department's goal and hit my numbers.”
Today we are in the middle of new conversations with the CMO / VP of Marketing, which go something like “Yes, I know there are systems to aid the marketing function, but the core of what we do is essentially creative so systems will only be of limited use to us.”
Can you see a pattern here? Every function I’ve encountered has fought its own systemization with assumptions that panned out to be wrong.
What do I mean by systemization? I mean the function now supports itself with information technologies and the use of these platforms fosters the creation of structured best practices’ within these departments.
The sequence of systemization in these functions follows a very similar path as well. The change usually starts with reporting, then moves to systemization of the actual activities of the function itself and finally reaches analytics, which leads to wide ranging changes in how the activities themselves are performed.
We’re now many years into the systemization of marketing and more technologies to support marketing activities are coming thick and fast. Plus, with the rise of the social web, we’re seeing new technologies extend further into the marketing function than ever before.
Today, we can actually engage with the precise audience we need to get impact from our marketing efforts, assuming you can first find them out there. So why should you care as a board member of an early stage business or a long standing multinational enterprise?
Because as we have seen in the course of the last 15 years, the rise of the internet is overturning a variety of conventional wisdoms. Assuming you’re in the boardroom as a result of many years of operational experience in the trenches then the tools we used in that era are changing rapidly.
There was a time where marketing was, run an ad, the right ad, in the right place, and people will ‘probably’ buy the product….OK…a little simplified but you get the point… Today, not so much.
When one of our customers was preparing to launch a new product, complete with the standard television advertising, they hit some financial roadblocks and were forced to launch sans TV. They chose to run an influencer campaign where key individuals were identified, given early access to the product and encouraged to communicate their experience to the market in an unvarnished, authentic fashion.
The company ended up with the best-selling product in their category for the following 12 months... at a fraction of the cost of a traditional campaign.
So given my vantage point from the Traackr boardroom, let’s talk Influence Marketing. As Larry Ellison said about cloud computing, “It’s not new, we’ve been doing it for decades–it used to be called timesharing!”, influence marketing isn’t new... we’ve been doing it for decades.
When I worked at Oracle we had very good processes for interacting with the influencers of the era (the folks at Gartner, Forrester et al.). We called it ‘briefing the analysts’ and it was a key todo for any major product release.
But the reality is, influencer marketing has changed and new systems have emerged. What exactly has changed?
1. The influencers are different people. In the last 10 years with the rise of the web, blogging, social networks etc. a new generation of influencers has arisen, separate and different to the traditional analyst organizations. Often these influencers are typically hands on users working with the technology in a segment with detailed first hand opinions that lead them to becoming recognized as experts.
As we recently identified, there are at least 10 types of influencers at play in the market, with subtly different roles, functions, goals. Understanding how to work with each of these folks becomes a key part of the new influencer strategy.
2. Finding influencers is no longer as easy as going to the list of the research firms in your space. Influencers can be anywhere, scattered across many different platforms and hidden from your view by the ocean of noise on the web. So why can’t we just use a standard search engine to find them? Because search engines were designed for a static web. They don’t look for influencers and aren’t great at surfacing the types of content published constantly on social networks.
3. The rise of social networks allows us to measure the contextual influence this new generation of publishers exerts on our industries. There are now systematic ways to find people and measure their influence in a given context. Traackr has, at its core, built an algorithm to do exactly that so the days of guessing who is important or basing your decision on popularity are over. You now have data to support your measurable influencer marketing strategies.
4. The influence marketing process has matured enough to be systematized. We know the sequence is: find the influencers, select those which are most relevant to you, execute interactions with them to influence them, monitor these interactions to determine impact and rinse/repeat. The next step up in this area is the rise of tools/integrations to help marketers manage their influencer interactions – stay tuned for the Traackr announcement on this topic….
5. The results are in -- the early movers have proven the value. From a bang-for-the-buck perspective, influence marketing is one of the most cost effective marketing tools available. In our own analysis, we calculate influencer marketing spend as a combination of 1) the tools budget and 2) the time spent on influencer strategy by the marketing team. The impact in both big ticket B2B technology businesses and consumer electronic businesses is astounding. The ratio of spend to impact (in this case, qualified leads/sales) as compared to traditional marketing is approximately 5X.
In other words you can take 20% of the budget currently dedicated to TV/Publications/Online, spend 20% of that number on influence marketing and essentially be revenue neutral (i.e. save 16% of the top line budget or increase sales substantially). Seems like a worthwhile exploration, don’t you think?
The methodology for influence marketing has also matured over the last year. In their forthcoming book, authors Danny Brown and Sam Fiorella delve deep into the mechanics of true influence and how it ties to concrete business objectives (think qualified leads, sales...). The effects are powerful.
In one example, Brown and Fiorella share a case study of MV-1 Canada, the international distributor of the world’s first purpose-built vehicle for people with physical disabilities and how, by breaking down where their audience was in the purchase lifecycle, and who they connected to while making decisions at each of those stages, captured a 20% market share within one year (just one of many examples you'll find in their book when it's released on May 13th).
If you’re a board member of a company that is dependent on marketing to generate sales leads and attract customers for its product, at the next board meeting, do your team a favor. Ask your CMO to layout their plans for incorporating influence marketing into the marketing activities of the business within the next 12 months. Because you can be fairly certain your competitors are getting that presentation...