Recently I noticed that a former client has been running their old television spots — undoubtedly an effort to take advantage of the recessionary conditions and reduced advertising presence of their competitors, and to do it at a bargain-basement price to boot.
I applaud this company for recognizing that now is a great time to get the word out, and for devoting considerable marketing spending under difficult circumstances. However, their approach illustrates some common pitfalls when trying to generate new income in tough times:
A Bad Message Then Isn’t a Better Message Now
Unfortunately, the decision to recycle old creative means that your messaging may be off. For my old client mentioned above, it means that a campaign whose message was subsequently tested with their customers — and failed miserably — is the basis of an ad spend of many thousands of dollars.
And the pity is that this organization has much better information to work with — a statistically reliable customer segmentation model that identifies not only their target customers but also the messages that are most compelling to them. Now, admittedly, they don’t have existing television creative supporting those messages — but that’s because the research showed television was not the most relevant medium.
This client would have been much more effective, I’d venture, by spending their money on a targeted campaign with relevant messages to key audiences.
Don’t Mistake Behavior for Motivation
Some organizations are lucky enough to have rich behavior-based data that can be very helpful in identifying customer groups for direct mail, email, and other marketing initiatives.
While this information is wonderful to have, in my opinion it doesn’t go far enough. While it can clearly show purchase patterns to help you understand what people buy, how much and how often, it can’t tell you WHY they buy.
So your data analysis may unwittingly be grouping those to buy for themselves vs. those who buy as gifts — or those who buy for the scent vs. those who buy for the color. Knowing the motivation behind purchase can help your messaging be more relevant — instead of marketing “purple candles” you can market “candles with a fabulous lavender fragrance” or “candles to match that purple couch”.
Key to your marketing success these days is to recognize which customers are likely to stick with you even when the going gets tough.
An extensive audience segmentation research project for one of my clients revealed that fully 30% of customers for that brand were “dabblers” — they were casual shoppers, tried lots of different brands and didn’t stay with any for long. While this segment can represent valuable revenue and profitability with the right strategy, the reality is that when things get tight they’re simply not going to retain enough brand loyalty to continue purchasing from you.
I am reminded of Robert DeNiro in “Meet the Parents” and his “Circle of Trust” — when you’re in, you’re in. Your brand likely has die-hard customers who will continue buying from you no matter how much they’re trimming in other areas. Some of these may be creatures of habit who use your product regularly and can’t imagine living without it — others may be “gifters” for whom your category is simply one of their chosen sources of gifts for friends and family, and for whom gifting fills a basic need.
Spending against these customers makes sense — they buy for a reason, and won’t suspend that behavior easily. In addition, brand loyalists are much more likely to respond to frequency offers and promotions including “tell a friend” components — they love you now and will tell others.
Lack of Prospect Targeting
If segments of your current customers won’t respond to your marketing, then even more unlikely are prospects with similar needs to those “out of the circle” customers. Once you know why your core customers stick with you, you can better find and message to folks like them. Particularly if your understanding is based on need and not just behavior, your marketing messaging can do a great job of pulling the heart strings of those prospects most likely to become long-term brand loyalists.
How well do you understand the motivations of your customers? How well do you know your core loyalty groups? How targeted is your marketing message? Don’t get so panicked by the current economy that you fail to consider your best message, to your best audience, and end up overspending and underdelivering.