Is Your Strategic Plan Strategic? Or Even A Plan?

Is Your Strategic Plan Strategic? Or Even A Plan?

How to avoid the top five mistake in your strategic planning process

“The best way to predict the future is to create it.” – Peter Drucker, Economist

Why is it that when a group of managers gets together for a strategic planning session they often emerge with a document that’s devoid of strategy, and often not even a plan?

Strategy, at its most basic level, is a set of choices and trade-offs about where an organization will invest, compete, and win. Planning is not a strategy-making exercise, and it is this author’s assertion that one cannot develop an effective plan before doing the hard work involved in crafting your strategy.

Most business managers and executives feel their organization would benefit from having a strategic plan. Small and medium businesses need a strategic plan to help attract capital investment by banks and investors; and larger, enterprise businesses need a plan to help satisfy regulators and harness the power of “business alignment” among divisions and teams.

With so much agreement on the need for strategic planning, why then do so many plans fail to be vital documents for their organizations? Why do executive teams groan about it being “that time of year again?” And why do managers read company strategic plans only to toss them on the shelf as unhelpful sheaves of paper?

The answer lies within the top five mistakes executive teams fall victim to:

  1. They treat strategic planning as a once a year task; a checkbox on the to-do list.
  2. Writing the strategic plan is delegated to a single executive, often the CFO, whose comfort zone centers on measuring, projecting, and calculating.
  3. Executive teams pay only “lip service” to the foundational elements of vision, mission, and values.
  4. They fail to initiate processes which make the strategic plan a “living document” that is constantly being monitored and adjusted.
  5. The biggest mistake of all: failure to embrace the fear and discomfort involved in effective strategy-making.

“Fear and discomfort are key to effective strategy-making.”

Strategic planning is a scary process because it forces executive teams to confront a future about which they can only guess. Further, executives involved in the process may fear that making the wrong strategic decision will limit or cut off other possibilities; and that getting it wrong will be a career-limiting decision.

What is the natural reaction to the fear and discomfort of this strategy-making challenge? Simple: they make the challenge less daunting by turning it into a problem that can be “solved.”

When strategy-making is short-circuited by making it something that can be “solved,” executive teams often create comprehensive plans for how they will invest in new or existing assets. These investments will allow the firm to achieve a target; for example, increasing the company’s market share, or enter a new market. Projections of costs and revenue are calculated and by the end of the “strategic planning process” everyone involved feels much less scared about their future.

A Terrible Investment

Such a process is a terrible investment of time and resources. If you and your executive team are comfortable with your strategy, it’s likely not a very good one. True strategic planning is about confronting your fear of the unknown, making hard choices, and placing your bets. The objective is to increase the odds of success – not to eliminate risk.

Therefore, a strategic plan should answer three foundational questions:

  • Who the company will serve and who they won’t;
  • What capabilities they will be disproportionately better at than competitors;
  • Why their target customers would choose them over competitors.

A process for helping organizations arrive at answers to these questions has five parts, as shown below:

Please note that none of these stages to strategic decision-making involve projections of revenue or costs. Why?

  • Costs are predictable and completely under company control. Business plans may institute controls that managers may measure, calculate, and project. And that is why costs are never part of strategic decision-making. Cost-planning is a trap that prevents effective strategic decision-making.
  • Revenue is never under the company’s control. Revenue is decided by your customers and no amount of planning will change that or make revenue magically appear. Revenue projections, too, therefore are never part of strategic decision-making.

“The goal of the strategist in the strategic decision-making process is singular: to find ways to acquire and keep customers.”

So how does one go about creating an effective strategic plan? A good start would be to separate the words “strategic” and “plan” and treat them as separate documents.

  • The strategy document summarizes a decision-making process that deals with the future and uncomfortable unknowns involved in creating value-propositions to attract and retain customers.
  • The business plan identifies, calculates, and projects costs that are under the company’s control. Ideally, it is based upon carrying out the strategies and vision identified in the strategy document.

A Better Path Forward

For help with creating or evaluating your strategy document, watch for my next installment about the foundational elements of strategic decision-making: the vision, mission, and values statements.

About the author:  David Eldred is the President and Chief Brand Technologist of Sine Cera Marketing, a boutique marketing consulting practice based in Sherwood, Oregon. Sine Cera specializes in helping businesses create and maximize their digital presence – as well as offering a full range of marketing consulting services, including social media marketing, social selling, search engine marketing, website design, and mobile marketing solutions. 

Data is the New Creative

Data is the New Creative

Using data to enhance relevance and personalize the customer experience.

“The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” –Peter Drucker

MModern marketers are awash in tools to pursue business objectives. Digital channels such as SEO, email, social, PPC, programmatic, retargeting, mobile, live chat and more have achieved widespread adoption and have matured downstream enough to be affordable for even small and home-based businesses.

Inherently data-driven, digital marketing is more than simply using lists to target audiences through digital channels. Thinking of digital marketing in such manner limits it to little more than the equivalent of direct mail through a digital channel. To take advantage of the power of digital marketing, marketers need to think of data as the new creative.

Evolving from Demographics to Intent

Marketers have used data to better target prospects for decades. In 1973, Peter Drucker wrote in his seminal book, “Management” that “the aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” By the 1980s, marketers were using data to categorize businesses and consumers into segments based on demographics, psychographics, firmographics and other common characteristics. Doing so helped marketers narrow the focus of their efforts upon those segments they felt would be most receptive to their messages. Today, Claritas classifies American consumers into 68 different clusters:

The downside of using demographic data for segmentation is that demographic models are not good predictors of consumer intent. The best we may hope from using demographics is a higher propensity for the target audience to be interested in a given offer.

For example, within financial services, a segmentation model based upon the two primary demographic selects of age and income yields clusters as shown in the following table:

Using this demographic data, marketers may narrow the focus of their outreach to target those consumers who have a propensity for the product or service they are promoting. For example, marketers promoting automobile loans may wish to focus on the Credit Driven segment because they are 2.5 times more likely than the general population to be interested in a new or used vehicle loan. By targeting consumers within that segment, marketers may be more efficient with their marketing spend; however, there is still a tremendous amount of waste in the spend because demographic data does not give insight regarding the timing of the offer. We do not know if a consumer is in the market at any given point in time by using demographic data alone.

Behavior Yields Intent

The advent of digital channels such as search engines and websites provided marketers with insight into consumer behavior at the moment of interest. Google calls these “Micro Moments” of consumer engagement, where a person is actively engaged in searching for information, acquiring knowledge and weighing next steps. Micro-moments are moments when people expect an immediate answer to something they want to know, go, do or buy.

The quest for information reveals consumer behavior from which marketers may derive intent. The opportunity to capture attention from a consumer actively engaged in searching for a solution is a magic moment. No matter where the consumer is in the sales funnel, acting upon this data to capture attention, create interest, nurture their evaluation and ultimately convert the sale is more easily achievable – if data is at the center of the marketer’s toolkit.

Search engine marketing tactics allow marketers to tap into the “live data” available to capture attention from consumers who are lower in the sales funnel and potentially in acquisition mode for a solution. Search Engine Optimization (SEO), as well as PPC advertising through platforms such as Google AdWords or Microsoft Bing, allow marketers to target keywords that are indicative of intent. This allows marketers to skip past the awareness and interest phases at the top of the sales funnel and be closer to the point of action where a sale may be precipitated.

The Need for Nurturing

With the amount of money now being spent on PPC advertising, it is clear that many more marketers are attempting to reach consumers at the point of action. However, research tells us that upward of 81 percent of consumers will perform some form of online research before making a purchase decision. If your digital marketing efforts stop at the point where you have motivated a click by your target consumer, you have not fully leveraged the ability for digital marketing to nurture your prospect along their buying journey.

Once you have captured a website visit, the challenge is to nurture that prospect along the buying journey toward the purchase decision. This will often require multiple touch-points that may involve all the following marketing tools:

  • Remarketing
  • Website personalization
  • Lead capture forms
  • Live chat
  • Direct mail follow-up
  • In-store recognition
  • Call center outreach

Please note that the last three bullet points involve offline channels. This may occur if the digital lead capture efforts were successful in expanding additional contact information with email, phone number or mailing address. Lead capture is becoming increasingly sophisticated with data enhancement capabilities such as IP address geo-mapping and marrying first-party data with digital channel engagement. Just because a website visitor has not provided you with additional contact information, this no longer precludes marketers from targeting a prospect with an offline offer.

Are You Leveraging First Party Data?

When a known user visits your website, do you recognize them? Are you able to associate their online activities and behaviors with the first-party data you already have, such as prior purchases and other key demographics? First party data is a treasure-trove of insight about your existing customer and the next best product you should offer them. Yet few marketers have connected the dots to link online website visits to first-party data and present products and services that are relevant to the customer’s situation.

Imagine how much more powerful your online effectiveness would be if your website recognized an existing customer and dynamically rearranged the content to present the next best product for that customer. Data allows modern marketers to put their best foot forward with relevant content and offers that are keyed to the interest that brought a visitor to your digital content. Higher levels of relevance equate with higher levels of engagement.

The Death of the Anonymous Visitor

As the Tealium video suggests, the tools to associate first-party data with someone who would otherwise remain an anonymous visitor is a powerful addition to the marketing tool chest. Companies like BlueConicMarketo and Adobe Marketing Cloud provide tools to marry anonymous digital interactions with the first-party data that unlocks marketing nirvana.

Multi-Channel Customer Journey

When marketing teams begin visualizing how data may power the interactions an organization envisions for its prospects and customers, the possibilities become much more powerful.

In the example below, what starts as a digital journey is transformed into a multi-channel opportunity to engage with a prospect and use first-party data:

  • Website personalization
  • Email automation
  • Direct mail automation
  • Call center engagement

There has never been a more exciting time for marketers to use technology to engage with prospects and customers. And data is the key to unlocking the potential for your organization. Data is the new creative.

About the author:  David Eldred is the President and Chief Brand Technologist of Sine Cera Marketing, a boutique marketing consulting practice based in Sherwood, Oregon. Sine Cera specializes in helping businesses create and maximize their digital presence – as well as offering a full range of marketing consulting services, including social media marketing, social selling, search engine marketing, website design, and mobile marketing solutions. 

Prediction: The Sixth “P” of Marketing

Prediction: The Sixth “P” of Marketing

What if you could predict who your next best customer will be?

“If we have data, let’s look at data. If all we have are opinions, let’s go with mine.” — Jim Barksdale, former Netscape CEO

The evolution of marketing never ends and today, technology continues to drive innovation and efficiency in the marketing function. In fact, for the first time, I believe technology is now capable of empowering savvy marketers to add a sixth “P” to the marketing mix. What is the sixth “P” of marketing? Prediction!

What if you could predict who your next best customer will be? Better yet, what if you could predict what product or service that customer is interested in? This is not only possible using the tools available to the modern marketer, but I purport that integrating prediction into your marketing toolset will make the difference between surviving and thriving in today’s digital world.

Casting Nets vs Shooting Lasers

Using the right tool makes any job easier and marketing is no different. Most modern marketers have incorporated digital marketing into their toolset. And most consumers now engage with digital platforms as part of their buyer’s journey.

81% of customers research online before setting foot in a store or calling.

Websites were an early digital marketing tool designed to cast a net that might pull in customers. Marketers recognized early-on that customers did some form of research online before setting foot in stores. Thus, websites evolved from being corporate brochureware to more interactive experiences. Today, deep content and stronger calls to action make the modern website a richer digital experience than ever before. And many companies now enable online purchasing to occur without ever setting foot in a physical store.

But that’s no longer enough.

Why cast a net when you can shoot a laser that targets precisely who is interested in your product or service?

Google calls this the ZMOT or the Zero Moment of Truth. The ZMOT is the decision-making moment when we as consumers decide what to buy. We may be influenced by any number of marketing deliverables:

  • Website content that provides a deep understanding
  • Ratings and reviews of other customers
  • Social engagement and exposure
  • Sales enablement in the micro-moment
  • Brand awareness and discoverability

As more and more marketers hone their skills in all the tools of our digital age, the unfortunate reality is that cycle duration has become shorter and shorter.

“71% of consumers made a purchase within a week of awareness or desire.”

What does this mean for the modern marketer? Today, you had better be shooting with lasers to win your next customer instead of casting an ever-less-effective net.

The New Marketing Model: Predict Your Next Customer Using Data

Prospects fall into one of three distinct groups:

  • Prospects who are unaware of your company or product;
  • Prospects who recognize your brand;
  • Existing customers who are looking for a solution.

A Marketing Automation Platform (MAP) is a great tool to use data to engage with each of these three groups and more precisely predict what they are interested in — and who they are. This is the essence of leveraging data to Predict your next customer.

If you haven’t yet selected a MAP, you may be interested in the process I used when evaluating which Marketing Automation Platform was right for my company. Selecting the right MAP partner is an important step, so don’t rush through the journey.

How A MAP Enables Prediction

At its most basic level, a Marketing Automation Platform taps into the data of customers and prospects who interact with your sales and marketing channels. By helping you know who is evaluating your online information, you can use that data to stay in front of that prospect throughout their buyer’s journey — automatically.

“Remember, 81% of customers research onlinebefore setting foot in a store or calling.”

Even more importantly, since 71% of consumers made a purchase within a week of awareness or desire, your Marketing Automation Platform is one of the only tools that enables you to stay in front of that prospect until they have triggered their Zero Moment of Truth (ZMOT).

“Staying in front of a high-intent prospect is critical to winning new relationships and generating more sales.”

Data Is The Fuel That Powers Your MAP

Are you leveraging your first-party data? First-party data is data you have collected about your audience — often your existing customers. It comes from a variety of sources:

  • Behavioral data: actions and interests users demonstrate on your website
  • CRM data: information users share with you, or from past purchases of your products
  • Social data: data pulled from people who interact with your brand on social media
  • Cross-platform data: information gleaned from mobile web or apps

Harnessing your first-party data and making it available to your Marketing Automation Platform is crucial to your success with the sixth “P” of marketing: Prediction. It often contains your most valuable insights to your existing customers and users. Why?

  • First-party data contains information about which of your products your customer is interested in. How do you know? Because they clicked on it!
  • First-party data tells you who the prospect is as well as their online and offline contact information.
  • First-party data can tell you how engaged the prospect is in your solution, by scoring their interactions in real time.

Three Mistakes To Avoid With Marketing Automation

The first mistake to avoid when putting your Marketing Automation Platform to use is to limit your communication to digital channels. The modern Marketing Automation Platform is a cross-channel personalization tool:

  • Personalize your website to focus on the solution that is of most interest to your prospect based on their first-party data
  • Personalize your email to stay in front of your prospect with a cadence of digital outreach that can reach them virtually instantly
  • Reach out in the offline world to stay in front of prospects via direct mail where they live or work — or both!
  • Call your prospect and engage with them via a meaningful conversation that is fully-informed about the product or service they are interested in.

In financial services, I mapped a typical buyer’s journey that identified how we would use Marketing Automation to engage with prospects across all four channels: website, email, direct mail, and call center.

Another mistake marketers must avoid is not to stop at the point of purchase. Congratulations! You’ve worked hard to identify your prospect, stay in front of them throughout their buyer’s journey and were successful in being the winner of their ZMOT. Don’t stop there!

The modern marketing funnel doesn’t stop at the point of purchase, but rather it expands each new relationship outward to form the “trumpet” of retention, expansion, and advocacy. Use the first-party data within your Marketing Automation Platform to ensure your buyer adopts your solution completely. Onboarding new relationships serve not only to counteract buyer’s remorse and apathy but also to move them further along the loyalty journey.

  • Use first-party data to identify the next likely product or service your customer may be interested in
  • Use “big data” analysis to identify “look-alike” audiences to pull in more prospects who resemble your best customers
  • Use propensity modeling to expand their relationship with the best products and services for their demographic, firmographic, or life stage they fall within.

The third mistake to avoid can be the biggest one of all: does your organization make it difficult for your marketing team to access and use the first-party data you already have? Organizations that put barriers in front of their marketing team’s access to data make the job of the modern marketer that much more difficult.

The good news is that technology continues to enable easier and easier access to data for marketing teams. A typical MarTech stack for the modern marketing team may include all the following tools:

  • CRM — (Customer Relationship Management) to allow enterprise-wide input of key customer and prospect interactions and communications;
  • CMS — (Content Management System) to allow the marketing team the ability to control website environment without tech-team involvement;
  • MAP — (Marketing Automation Platform) to automate the marketing communications function at scale and in real time;
  • CDP — (Customer Data Platform) enables easy access to first-party data by non-technical members of the marketing team;
  • Analytics — serve as the linchpin of your MarTech stack. Because if you can’t measure it, you won’t know what is effective.

Prediction Is Possible

It is an exciting time to be a marketer! Never before have so many tools come together to make the life of the modern marketer easier. Now go have fun using your laser to predict your next customer and generate more efficient selling for your organization.

About the author:  David Eldred is the President and Chief Brand Technologist of Sine Cera Marketing, a boutique marketing consulting practice based in Sherwood, Oregon. Sine Cera specializes in helping businesses create and maximize their digital presence – as well as offering a full range of marketing consulting services, including social media marketing, social selling, search engine marketing, website design, and mobile marketing solutions.