Measuring Engagement: A Case Study

[Posted by Julie Katz]

Follow Me on  Engagement is such a grand concept that relates to everything from purchasing and repeat usage to satisfaction and recommendation behavior. Customer intelligence professionals want to nail it down and measure their customers' level of engagement, but they have trouble nailing down a precise model to do so. We have a new case study that details how one organization, Channel 4, the UK media outlet, decoded engagement.

Over a year ago now, Channel 4, the UK media outlet shifted its teen programming from TV to online -- not a surprising move, given teen's media consumption -- but it lacked a concrete way to prove the impact of sucha  move. Go-to measures from TV, like reach, didn't give a complete answer to whether the move to online made sense for C4. So, C4 turned to interactive agency iCrossing, which created a framework that merged traditional and newer measurement tactics to get at engagement with the online game C4 had developed. They mapped the top-line engagement categories from Forrester to the key questions C4 needed to answer, the metrics they'd monitor, and the tools they'd use.

 

C4 further modified iCrossing's approach to arrive at a flexible, adaptable approach to measure engagement on a variety of projects, not just online games. The advantage of such measurement? C4 can now easily modify marketing outreach and product development and continually learn about its audience.

Read the case study to learn more details. Because engagement is multi-layered and unique to individual business goals, there's no one right way to approach it. Contact me if you need help thinking through your approach.

And, stay tuned for deeper research on the influence component.

Clarifying The Market Mix Modeling Landscape

[Posted by Julie Katz]

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In the process of developing my new coverage area: marketing measurement, I'm working on a report to clarify the market mix modeling landscape and give customer intelligence professionals a sense of where they can turn for help with these complex projects. We understand the challenges that surround the traditional approach to market mix modeling (they're static, they require too much time to put together, they're not granular enough) and have outlined them in a Q & A report. But we want to help you get a better sense of the partners behind the models.

We typically point to the same handful of vendors that can build these models -- Analytic Partners, Hudson River Group, Marketing Evolution. These vendors, and a small group of up-and-coming technology-based solutions like ThinkVine, M-Factor, and MarketShare Partners, have the analytics and statistical chops to build models, for sure. But what I'm really after is who do customer intelligence professionals seek out and why? What are the plusses and minuses with your current partners? And what would you ideally like to accomplish?

The outcome of this research will carve up the market mix modeling space to share with customer intelligence professionals which vendors can help them make the best investments in the online space, deal with turbulent market conditions, provide the best ROI for their models. I need your help: I'm about to reach out to a host of vendors, but I need to know:

• Who do you use to build your market mix models (so I don't leave anyone off of my list)?
• What questions would I regret not asking of the vendors?
• What core challenges do you face in building or using the models?

Thanks for your help! I'll keep you posted on the research as it develops.

The Future of Agencies: What Do You Think?

[Posted by Dave Frankland]

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We’re in the process of pondering a very important question in the industry today: what is the future of agencies? Agencies have played such a crucial role in helping companies market their products and services for more than a century. Names like McCann Erickson, Young & Rubicam, J. Walter Thompson, Ogilvy, and Saatchi & Saatchi (among others) are practically household names. There’s even a massively popular and critically acclaimed television show capturing life in the golden age of legendary agencies on Madison Avenue.

Yet the agency model was built during a time when there were only a handful of channels in which they could push one way messages en masse. Does that model still work in a time when nearly a quarter of online US adults now create content online? Many more questions begin to arise as we open Pandora’s Box: Can one agency do it all? Are holding companies the answer? Can digital agencies compete with them and lead brands? Do marketers rely on agencies like they used to? Should marketers consolidate their agencies or de-centralize to dozens of agency partners? Are technology providers and crowd sourcing legitimate threats? Where is this all going?

To conduct this research we’re speaking with some of the most influential agencies, marketers, and service providers. However, what better way to get a feel for the pulse of the industry than to crowd source it? So we’re reaching out to get your take on the space. Please give us your thoughts in the comments section on the question: What is the future of agencies?

We’re looking forward to your input (and please try to keep it to one or two paragraphs)! Since this research is a collaborative report across roles, this post is cross-posted on the Marketing Leadership, Interactive Marketing, and Customer Experience team blogs.

A Fond Farewell to John Lovett

[Posted by Carl Doty]

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About a year ago, I took over the management of what has become Forrester's Customer Intelligence (CI) team. In doing so, I've had the pleasure of working with Senior Analyst John Lovett, who joined the team after our acquisition of Jupiter Research last year. Regretfully, I must tell you that John has decided that it's time for a change of pace.

I know I can speak for the rest of the CI team by saying that we will miss John's camaraderie and his stellar contributions to the CI research agenda. To know John is to understand his passion and enthusiasm for the Web analytics space—a topic that John covered as an analyst for the past decade. So what’s next for John? Starting after the Thanksgiving holiday, John will be applying his knowledge and enthusiasm for Web analytics in the field. I sincerely hope that our paths will cross again in some capacity in the future.

So the next logical question you are all thinking is...who's the next Forrester analyst covering Web analytics? While we have some tremendously talented analysts like Suresh Vittal, Julie Katz, and Dave Frankland covering all things related to Customer Intelligence, we are starting a search for a Senior Analyst to join the team. The ideal candidate has deep experience in Web analytics, multivariate testing, Web site behavioral targeting, and site optimization. They also must bring forward thinking ideas on how these technologies can improve enterprisewide Customer Intelligence for firms of all sizes and industry flavor.

You can view the full job posting online for more details. If you are interested, please contact me directly at cdoty@forrester.com.

Please join me in wishing John the very best in the next chapter of his career!

A CI Perspective On Forrester's Consumer Forum

[Posted by Carl Doty]

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Well, we’re back in the office after a highly successful Consumer Forum in Chicago last week. It was great to see and meet those of you who attended.  For those of you who missed it, I thought I’d share a few nuggets from the event—specifically, the great buzz around all things Customer Intelligence.  You might say that it was a mini “coming out” party for Forrester’s CI team as it was our first event since we launched the practice back in July.  All of our CI Analysts were on site meeting with clients, delivering track sessions, and enjoying some unseasonably warm weather in the windy city.  Here’s a little taste of what the CI buzz was about: 

• How to use Customer Intelligence to bridge the social and offline divide.  Dave Frankland and Suresh Vittal spoke to a standing room only crowd (actually, some people were sitting on the floor in the middle aisle).  The beginning of the session outlined how CI professionals can use customer analytics and listening platforms to uncover invaluable customer insights across all channels—including social media.  Additionally, the pair of analysts explained Forrester’s framework for turning customer data into smart business strategy – a presentation based on Dave’s “The Intelligent Approach To Customer Intelligence.” The twitter stream was all abuzz during this entire session, as attendees took it all in and shared their thoughts in real time.

• Customer Intelligence metrics that matter.  Our very own Julie Katz led a session on marketing measurement at the end of the forum.  We were impressed by the attendance of this track session, which typically dwindles at the tail end of any event.  Not this time.  A room full of marketers listened attentively as Julie explained that marketing measurement is really still a nascent discipline.  To highlight her point, she invoked the story of the reinvention of baseball statistics as told by Michael Lewis’s Moneyball.  As that reinvention unfolded, it caused major league teams to rethink how they value their players and prospective draft picks.  Julie explained that marketers need to go through a similar transformation and rethink how they measure the success of their efforts—in terms of business value.  Gone are the days of simply measuring click-thrus and page views.  Watch for Julie’s soon-to-be published case study about how the UK’s Channel 4 successfully measured customer engagement to drive business value.  In the mean time, check out her guide to marketing mix modeling for Customer Intelligence professionals.

All in all, the Consumer Forum was chock full of compelling content and the latest thinking on how B2C marketers can reach “three-dimensional” consumers—multi-channel consumers who are more empowered, and less tolerant of marketing than ever before. If you missed it, I hope you can join us at Marketing Forum 2010, where our very own Dave Frankland will be a keynote speaker on day two. Save the dates: April 22-23 at the Hyatt Regency Century Plaza in Los Angeles, CA!

Thanks for all of your contributions on this blog to date!  I hope that you continue to find it interesting, relevant, and valuable.  Stay tuned for much, much more!

Best regards,
Carl

The Intelligent Approach To Customer Intelligence

[Posted by Dave Frankland]

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According to Amazon's former Chief Scientist, individuals will generate more data in 2009 than in the combined history of mankind. Think about the implications for your marketing and overall business. On the one hand, it is possible to know more about every prospect and customer, and to improve their customer experience based on what you know about them. On the other hand, it's very easy to drown in the exponentially growing stream of data. Customer Intelligence (CI) professionals sit at the nexus of this data explosion, while also dealing with tectonic shifts in customer behavior, and an increased demand for marketing accountability.

Although these changes generate plenty of anxiety for customer intelligence professionals, they should not be perceived as a threat. Forrester believes this is a time of tremendous opportunity—a call to arms for left-brain marketers across the globe.

In my latest research (featured this weekend by CRM Magazine) we demonstrate how Customer Intelligence is evolving from a tactical and functional role to the future command center for businesses. We identify three stages of CI maturity - from functional intelligence, to marketing intelligence, to strategic intelligence. Within the most advanced firms, the customer intelligence function has evolved into a strategic weapon that helps firms drive corporate strategy and create competitive advantage. These advanced firms use Customer Intelligence to go far beyond just improving campaign performance. They also use CI to improve customer acquisition, retention, and satisfaction, as well as increase revenue, profitability, and customer value.

Given the strategic value of this role, we believe that the next generation CMO will come from the Customer Intelligence discipline. That’s not to say CMOs won't continue to care deeply about the brand, and the emotional connection that they create with their customers. But, as they struggle to engage with empowered, connected customers who have limited tolerance for marketing, firms will elevate CI within their organizations to influence mission critical business decisions with data-driven insights. These CMOs will help their organizations to focus on customer value, and use it as the connective tissue that causes all marketers and business units to pull in the same direction.

This report is intended to serve as a framework for turning customer data into smart business strategy. Over the next few months, Forrester’s CI research team will build on this research from a variety of angles. Next up is a self-test to help you understand your Customer Intelligence quotient and identify the key areas for investment and improvement. In the mean time, please join the conversation -- let us know what challenges you are struggling with as you seek to improve the sophistication of your CI organization, and where our research can help to make you more successful in your role.

Cheers,
Dave

Intelligent Dialogues: Stan Rapp

[Posted by Dave Frankland]

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The Customer Intelligence team introduces an ongoing series of interviews with industry luminaries that we call "Intelligent Dialogues". For the inaugural session, we interviewed Stan Rapp, Chairman of Engauge, and recognized by Advertising Age as one of the 101 individuals who shaped advertising in the 20th Century.

At next week's DMA Annual Conference, Rapp will launch a new book titled Reinventing Interactive and Direct Marketing. wn withRapp introduces a concept he calls iDirect – which leverages a direct marketing framework and a full range of digital tools to engage with consumers at a time and place of their own choosing. For our first Intelligent Dialogues interview, we sat down with Rapp and asked about the book and about the changes he sees in the market.

Forrester: Stan, tell us first about the catalyst for the book and also, "why now"?

Rapp: The catalyst was a conversation with John Greco, the CEO of the DMA, over lunch nine months ago. It turned out we shared a common concern about the gulf existing between a rapidly expanding, new “interactive industry” and the long-established direct marketing business-generating powerhouse. The interactive creatives were focused on new pathways to customer engagement without nearly enough attention to the data-driven accountability and addressability at the heart of going direct. There was a failure to grasp that digital is direct. At the same time many direct marketers, while embracing e-commerce, did not fully grasp how direct is being transformed by digital. We agreed that direct and digital were seen by far too many marketers as separate disciplines when actually they are one and the same.

Interactive without a direct marketing mind-set focuses mainly on providing sticky involvement. Direct without an interactive mind-set focuses mainly on gaining immediate sales and acceptable cost per response. What was lacking is a model for what happens when it’s all joined seamlessly. John thought the challenge called for a new book embracing the confluence of direct and digital.

I edited the book and authored its Introduction. During the past nine months, I came to realize that we were creating a new marketing paradigm for the digital era, which we call iDirect. We think of iDirect as being built on a framework of proven DM addressability, and it utilizes an abundance of digital tools for engagement with prospects or customers at a time and place of their own choosing.

Forrester: What is the biggest change you see in companies adopting an iDirect approach?

Rapp: Here is what I believe iDirect marketers do better than anyone else:

• They create conversations with customers, as a first thought, not an afterthought. iDirect Marketers turn social data into incremental dollars.
• They give collecting, appending and analyzing data the highest priority. iDirect marketers know how to apply customer intelligence for best results.
• They generate a multitude of ROI positive revenue streams from online and offline relationships.
• They send Lifetime Customer Value into the stratosphere with new sales promotion tools benefiting from a cascade of online customer behavioral insights.
• They set a specific goal when planning any interactive or advertising campaign. iDirect marketers never fly blind.

And iDirect marketers know how to predict the unpredictable. Predictive modeling in combination with interactive relationships forged online produce amazing, measurable results.

Forrester: As you know, at Forrester, and particularly on our team, we write a lot about customer intelligence. We’ve seen the world of customer intelligence hold up pretty well over the past year, despite the challenging economy. What’s your take on the reason for that, and how significant is it that in many organizations customer intelligence grew out of the direct marketing arena?

Rapp: The fascination with customer intelligence began when the information age arrived some time around 1980. It was pacesetting direct marketers who seized upon a newly arrived magic potion - database marketing – to begin a new marketing era. A decade later, direct marketers were already talking about utilizing customer intelligence to begin the pursuit of one-to-one marketing. And it was direct marketers who led the way in taking customer intelligence to the next level - Customer Relationship Marketing (CRM).

Now with extraordinary new digital tools at our command to drive the growth of customer intelligence, it is only natural for direct marketers to be taking the lead once again. Customer intelligence is the core driver of the new iDirect Marketing platform.

Forrester: As a member of the DMA Hall of Fame, a founder of a global agency that bears your name, and the chairman of a new breed of agency, it’s so impressive that you continue to push the envelope within the marketing industry. What keeps you going, and if you had a magic wand, what one thing would you change within the world of marketing?

Rapp: What keeps me going is the energy generated in discovering unexpected solutions to perplexing marketing problems. The possibility of sparking explosive new ideas at a time when so much more can be done than ever before, is the catalyst that keeps me pushing the envelope.

The one thing I most want is to see a transformation in the mind-set of marketers from “what can I get out of this customer” to “what can I do for this customer”. We need more caring and daring from marketers.

Google may not be free from doing evil these days but the folks there are incredibly good at providing free analytic tools that help small business get big results on the web. That’s one of many caring and daring moves that contribute mightily to Google’s unprecedented success. You can visit the web sites for Nike ID and Nike Plus for a further demonstration of what caring about the needs of customers in daring new ways can do for a brand.

Forrester: Thank you, Stan, for joining us and for sharing your insights.

Stay tuned for future interviews and Intelligent Dialogues!

Cheers,

Dave

Intelligence is everything, and it can come from anywhere

[Posted by Dave Frankland]

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If you haven't read Lisa Bradner's latest report, Adaptive Brand Marketing, I strongly encourage you to do so. It is focused on the changing world of brand management, but its implications and principles go way beyond. Lisa points out that organizations are ill equipped to handle the world of "always on" marketing in the digital age, and explains that, to remain relevant, marketing leaders will embrace Adaptive Brand Marketing. This is an approach in which marketers respond quickly to their environment to align consumer and brand goals and maximize return on brand equity.

As Lisa points out, Adaptive Marketing isn't just about embracing new channels. In fact, she argues that channels are an outcome, rather than an organizing principle. Channel mix is determined based on a deep understanding of customers and their needs. She also points out that spending and planning decisions are daily - not annual events; and that segment, in addition to brand, matters when engaging with customers. All of which brings me to a key tenet of her research - that "intelligence is everything and can come from anywhere". Lisa argues that Customer Intelligence will become the molten core of successful organizations.

 

So, what's the best thing about this research from your perspective? Lisa serves the Marketing Leadership role at Forrester. In other words, she's convincing your boss, or your boss's boss about the value of Customer Intelligence. I would say run, don't walk, to read it - and then make sure you reference it repeatedly in conversations with your boss!

 

Cheers,

Dave

Join Us At Forrester's Consumer Forum 2009

[Posted by Carl Doty]

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Forrester’s Consumer Forum 2009 is fast approaching — October 27 and 28 in Chicago —and I look forward to seeing you there! The theme of this year's event is: "Creating Breakthrough Multichannel Relationships". With a theme like that, it should come as no surprise that we will have some great Customer Intelligence representation.  Check the agenda for insightful track sessions from our very own Julie Katz, Dave Frankland, and Suresh Vittal.

We have great speakers this year, with keynotes from:

Guest Speakers

• Brad Brooks, Corporate Vice President, Windows Consumer Product Marketing, Microsoft
• Michael Darviche, Chief Marketing Officer, Acxiom
• Prasanna Dhore, Vice President, Hewlett Packard
• Barry Judge, Executive Vice President and Chief Marketing Officer, Best Buy
• Bob Kraut, Vice President, Marketing Communications, Pizza Hut
• Michael Menis, Vice President, Global Interactive Marketing, InterContinental Hotels Group
• Sophia Stuart, Executive Director, Mobile, Hearst Magazines Digital Media
• Virginia Suliman, Vice President, Web Design & Development, Hilton Hotels Corporation
• Paul Vienick, Senior Vice President, Long-Term Investing and Customer Experience, E*TRADE

Forrester Speakers

• Julie A. Ask, Vice President, Principal Analyst
• Josh Bernoff, Senior Vice President — Idea Development
• Bill Doyle, Vice President, Principal Analyst
• Henry H. Harteveldt, Vice President, Principal Analyst
• Carrie Johnson, Vice President, Research Director
• Harley Manning, Vice President, Research Director

Don’t miss out on this opportunity to learn from the experts — visit Forrester.com for more information. If you’ve already signed up, here are some great ways to maximize your experience:

• Follow us on Twitter as we plan and launch the Event.
• RSVP on our Facebook Event page, and network with attendees.

It's a convenient location, a great venue, and an opportunity to network with the best and brightest.  We hope to see you there!

Carl

Are you ready for the economic rebound?

[Posted by Dave Frankland]

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While Ben Bernanke has been raising our hopes that the recession is "very likely over", we're noticing a change in the conversations that we're having with marketers and vendors alike. These conversations seem to reflect that the economy is getting stronger, purse strings are loosening, there's greater talk of RFPs and vendor evaluations - this week alone, our team had inquiries about vendor selection with marketers in insurance, retail (and it's almost Q4!), travel, pharmaceutical, and telecom.

So, while we're delighted that the rebound might be real, we also hope that marketers pay attention to the lessons from a little over a year ago. While it's easy to point the finger at the Wall Street rogues, plenty of firms took on too much risk or paid more attention to acquiring new customers than focusing on the ones they had.

As marketers, we can learn from the past year and do our part to help ensure that the turnaround sticks. How?

• Don't abandon the focus on customer retention and loyalty. When times are tough, and new customers are few and far between, it's hard not to focus on your existing customer. We would anticipate that the pendulum will swing back someway towards prospecting and acquisition, but would counsel firms to continue to focus on retention -- who knows, your customer might have liked all that attention and may well have come to expect it.
• Don't value customers as though they are uniform. Not all customers are created equal. Don't treat them as such. Focus on segmenting your customers by value and showing the love to those that deserve it. While you're at it, why not leverage that insight into your acquisition efforts - wouldn't it be beneficial to focus your acquisition efforts on higher potential value customers?
• Use customer intelligence to drive your budget allocation strategy. Leverage the knowledge you have about your customers to allocate your media dollars. Start, once again, from a position of customer value - what media do your most valuable customers consume. Is that where your budget is weighted today? If not, why not?
• Build on your voice of the customer investment. We saw a lot of heat in the market around Listening. We hope it's because firms recognize the importance of having a listening post for their organizations and not because it was a relatively inexpensive investment at a time of tight budgets. As listening platforms begin to mature, voice of the customer and listening initiatives should be as hot as ever - now is the time to add to your listening activities, not cut them back.
• Get ready to experiment. Innovation often comes out of an economic downturn. Watch for emerging companies that may be ahead of the curve and be prepared for what might be bubbling under the surface that might be worthy of experimentation. Who knows what the next Wave might be...?

Cheers,
Dave