Monday, June 18, 2012

Agile Marketing: The 40,000-Foot View

After learning about some of the fascinating efforts that the “agile marketing group” are making to have a process corresponding to “product development agility” over the last month, I find it’s a good time to set down some possibly useful thoughts on the subject. These are thoughts from the point of view of a computer industry analyst reasonably well versed in software development and agile concepts in that area, and with a reasonable theoretical and consulting acquaintance with marketing to businesses.

I call this a 40,000-foot view because I think that the success of agility in product development should challenge marketers to rethink their jobs fundamentally, not incrementally. However, it is all too easy to take a 20,000-foot view as from an airplane, seeing the broad outlines of marketing as it is today and picking and choosing those parts of product development agility (like the notion of “simplicity”) that comfort rather than challenge the marketer. With a 40,000-foot view, only the largest of mountains breaks up the monotony of land or sea, and we avoid getting bogged down in details or transitory marketing practices.

The aim of this view, therefore, is to think:
·         Long-term;

·         In terms of customer lifecycles;

·         Focusing on customer change rather than a succession of static preferences.
I hope to end up asking how the agile marketer can steer company products and services for the most effective “customer dance” with a broad range of customers, and what kinds of agile practices drawn from development can best serve them in this effort. But first, alas, definitions.

A Different Marketing Model

First, I would suggest that, as I noted in a previous piece, all “customer dances” (ongoing interactions with a customer) can be thought of as offering the company’s “worldview” to the customer to adopt or not, in competition with other companies’ worldviews.  For example, a buyer of insurance is offered several alternative ways of entering into a world of protection from nasty things that can happen to the customer. Or, a buyer of video games is offered many ways of living in alternate worlds where certain types of skills are trained for. If one thinks of a typical adult customer’s day, it starts with products and worldviews associated with home, then with worldviews that aid one at a particular type of job, then worldviews associated either with entertainment or more home tasks.

I suggest that customers’ needs for worldviews can be vaguely sorted into three categories:
1.       Learn. There are psychic as well as physical rewards for people who learn. Moreover, it is an open-ended process, one that need never end. Examples might be education, hobbies, training, passions, and fantasies.

2.       Do. This has been the traditional realm of much marketing, and has traditionally been thought of as mostly involving survival, job, or family support needs, ranging from buying food to mowing the lawn.  This is often true; but often there are psychic rewards for just accomplishing something “well”.

3.       Interact.  Pure Learn and Do are solitary activities; pure Interact has no purpose other than connecting to other people. This recognizes both the need for and psychic rewards for these connections. Things like phones, email, meeting halls, and dates are, by and large, mostly for Interaction.
It should be obvious that much of what is sold is a mixture of all three; but it is frequently useful to ask which of the three predominates.  For example, a PC today is typically used in the consumer market predominantly to Learn (the blogosphere is an example) and secondarily to Interact, while in the business market it is primarily used to Do.

The marketer therefore has two fundamental choices:
1.       Which worldview – which mix of learn, do, and interact – should I associate my company (brand, products, services) with? In other words, the choice is not merely one of industry – if “marketing myopia” didn’t make that clear – but also of the way the company would like the customer to think about the world (obviously, one that will sell lots of stuff) – bearing in mind that the customer has things to do and lots of alternatives, and so the time the customer spends in any one company’s worldview is very limited.

2.       Where in the customer’s life should I begin my relationship with the customer, and where should I end it?  Let’s face it, babies don’t buy products by themselves, and neither do the elderly in assisted living.  The relationship with the customer must have a beginning and an endpoint. Call this the relationship lifecycle.

Coming to Different Agile Answers

Before we launch into suggested “best” choices, let’s pause and think of ways that agile marketing might be said to be different from other marketing approaches.  If I had to give a short answer, it would go something like this:

·         Agile marketing emphasizes frequent, two-way conversations with the customer. In other words, the company does not decide a worldview and relationship lifecycle in isolation:  It constantly evolves both in partnership with its customers.

·         Agile marketing increases the company’s own emphasis on learning, especially compared to doing.  That change does not force the company to adopt a worldview that emphasizes learning more than before; but it does give the company additional ability to implement a worldview oriented more strongly towards customers’ “learn” needs. Thus, for example, can learn customers’ book preferences and trade that for increased sales by giving customers advance notice of publication of books they are fond of.

·         Counterintuitively, an emphasis on iterative, incremental new marketing and customer interactions leads agile marketers to a more long-run view of the customer relationship. Tighter bonds with customers lead naturally to greater efforts to extend the relationship.  That, in turn, gives the company new capabilities for longer relationship lifecycles.

·         Finally, compared to previous marketing approaches, agile marketing emphasizes more the idea that change is good. Mostly, this refers to changes in company marketing practices, company attitudes towards customers, and changes made during marketing projects.
Now let’s think selfishly about what a company wants, in order to maximize revenues/profits in the long term.  The company wants:
·         The most possible (profitable) customers;

·         Over the longest possible relationship lifecycle;

·         With the greatest customer loyalty (here I mean not just continuing to buy the same products, but also following the company into new products/services).
Let me pause for just a moment and put that in terms of worldviews and lifecycles. Here’s a grossly generalized Table:

                 Worldview                              Relationship Lifecycle
Learn       Values trading info                Very long
Do             Values quick solutions         Short
Interact     Values lots of interacters    Medium-term
And so, agile marketing appears to improve a company’s revenues/profit maximization in three ways:
1.       It lengthens the company’s typical relationship lifecycle by emphasizing Learn customers more.

2.       It increases customer loyalty by both involving the customer more and providing follow-on or related products/services more rapidly.

3.       It increases the number of customers both by speeding company movement into related markets and by decreasing customer disloyalty.

4.       It makes the company itself more able to change its target customers and therefore itself as the environment changes in future – by helping to make the company culture comfortable with change.

Two Personal Views: Addicts and Learning

I believe that agile marketing should also consider two other long-term aspects of customer “needs,” because, in the long run, I see traditional company strategies as sometimes harmful to companies’ long-term success.

The first aspect is the company-strategy tendency to sell to what I call the “addict” – someone who is or becomes psychologically addicted to a type of product or service.  Obviously, there are food addicts and drink/drug addicts; but there are also shopping addicts, home-repair addicts, conversation addicts, and even flying addicts. The characteristic of the addict is that he or she is impelled to spend more on a particular product/service type than is good for him/her – but that’s the type of customer that a company reflexively wants.  You want to buy?  Buy more!

I would argue two things about the addict.  First, in the long run, feeding addicts shortens relationship lifecycles (the addict’s life goes down the tubes), decreases other-customer loyalty (all I hear from you is buy, buy), and decreases revenues from the customer (I’m in hock up to my eyeballs). Second, the Learn customer is least likely to be an addict – both because the customer himself/herself is most adaptable to the changing needs of the workplace, and therefore more likely to have cash to spend, and because the customer may be more “realistic”, and therefore more likely to recognize and avoid addiction.
Therefore, I conclude that marketing in general, and agile marketing in particular, should consider the company’s present mix of addict and non-addict, and shift towards fewer addicts, possibly by moving towards a greater mix of Learn in its customers.
The second aspect of customer needs I think agile marketing should consider, irrespective of addiction, is which of the three “types” of customer would be best for the company, say, 10 years from now. We can point to plenty of companies that emphasize Learn, like video-game companies, and plenty that emphasize Interact, like the cell-phone and social-media companies, and definitely plenty that continue to emphasize the Do customer.
I would argue that most consumer companies, at the least, would benefit by increasing their proportion of Learn customers. They appear to be least likely to be addicts; they are least likely to get tired of or get a surfeit of the stuff provided; they have the potential to offer very long relationship lifecycles; they can provide a surprising amount of valuable information to the company along with their money; and the newness of what you provide is generally more exciting, while being “safe”. And since most B2B companies wind up providing value-add to products and services that wind up in the hands of consumers, they, too, should consider whether to improve their Learn customer value-add as passed on by the intermediate business.

The Agile Marketer’s Job

Implicit in the above analysis is a fairly simple statement of what should be the agile marketer’s general strategy:
Stretch all dimensions of the customer’s worldview/lifecycle.
This means, specifically:
·         Try to make the customer see you as a larger part of their life, by seeing you as in sync with their life and offering an interesting way to approach more and more of that life.

·         Try to stretch the length of the customer lifecycle backward and/or forward, by making the “cool stuff to learn about” accessible at earlier ages and applicable at later ages. Is it home repair you’re selling, or new cool solar ways to slice and dice your dwelling flexibly and in line with your own unique fashion sense – even in doll houses or Sims?

·         Increase customer loyalty to existing products/services by “crowd-customer-sourcing” their frequent upgrade, like bees building a hive under your (the queen’s) direction.

·         Increase customer pull to follow-on products by involving them early, focusing on Learn-type products/services/messages (build a better Lego Star Wars game!), and measuring/interacting two-way with customers rather than relying on the CEO’s “opinion.”

·         Make the brand a “learning” one (we’re in this together with the customer, and we’re going to do something insanely great), and drive comfort with “agile marketing” through the rest of the company by incorporating the idea of being agile in the company brand and culture.
I would also, myself, add three other elements of that strategy:
·         Both in product and promotional marketing, act as an integrator and not just as a coordinator of the rest of the company.  Coordinators make sure the functions don’t stumble over each other; integrators put “all the wood behind one arrow”, as Scott McNeally of Sun used to say, everything behind one overall strategy and consistent with one overall brand.

·         Stretch towards transparency to your customers and sacrifice some of that secrecy from your competitors as a tradeoff. Amazon wins because it always knows more about the evolution of its customers’ book needs, not because it hides its new software from its competitors. Moreover, as I have argued elsewhere, coopetition plus agility is a better long-run strategy than cutthroat competition.

·         Emphasize agile marketing software infrastructure. That is, pick a set “tools that believe”, tools that aim to foster marketing process agility or “get out of the way”, to support the marketing process and customer communications. Collaborative new-product development tools that link in the company’s Web customer “community” are one example of this.

Nasty Problems

Changing company culture rarely occurs without serious resistance (is that enough of an understatement for you?). And that is where the problems with applying this 40,000-foot view of agile marketing strategy to a ground-level business will typically lie. A frequent theme of the recent agile marketing manifesto “sprint” was seemingly unavoidable resistance from the rest of the company – or even other marketers.
Obviously, without enough experience in those situations, I can’t supply a definitive answer.  I can, however, suggest a couple of strategies:
·         In any in-business confrontation, greater knowledge of the customer is frequently a trump card. Specifically, if you say “surveys show that this is the way we are coming across to the customer”, that is a very good long-run argument when you either “kick the argument upstairs” or face an inevitable “shoot-out at high noon.”

·         Most people in business always have a yearning for “safe change”; why else would higher-ups enjoy golf, which always involves getting yourself to learn more and more about how to get better and better, without any real risk to the rest of your life? However, that has typically been ground under by the so-called realities of making a profit by getting a fixed thing done on time and on budget.  See if the resister in question can get the idea that agile is “safe”, that he or she will get it done faster and better by going agile, and that there is really less risk involved in continually trying something new, the “agile” way.  As many have testified in the past, once people get that idea, their enthusiasm and their agile performance is better than before.

Present-Day Agile Marketing Approaches to Build On

For a hotbed of agile marketing ideas, I’d suggest going to the Agile Marketing Facebook Group first. Here’s a snapshot of some of their “values” … :
  1. Validated learning over opinions and conventions.
  2. Customer-focused collaboration over silos and hierarchy.
  3. Adaptive and iterative campaigns over big-bang campaigns.
  4. Process of customer discovery over static prediction.
  5. Flexible planning vs. rigid planning.
  6. Responding to change over following a plan.
  7. Many small experiments over a few large bets.
And “principles”:
  • Simplicity is essential.
  • Learning via a build, measure, learn feedback loop is the primary measure of success.
  • Sustainable marketing requires you to keep a constant pace and pipeline.
  • Don't be afraid to fail; just don't fail the same way twice.
  • Continuous attention to marketing fundamentals and good design enhances agility.
  • Deliver marketing programs frequently, from every couple of weeks to every couple of months, with a preference for a shorter time frame.
  • Great marketing resources requires close alignment with the business people, sales, and development.
  • Build marketing programs around motivated individuals, give them the environment and support they need, and trust them to get the job done.

Conclusion:  Movements, Agile Lemonade, and Pay for Fun

Let me close this 40,000-foot view by giving two additional thoughts possibly useful for agile marketers.  First is that the agile marketing effort bears every stamp of what in the computer industry is sometimes called a “movement.”  What’s a movement?
I define a movement as a new kind of market, or way to grow a market, characterized by:
·         Enormous, even quasi-religious, enthusiasm.

·         Participants who act as both initial vendors and initial consumers.

·         Ability to judge offerings not just by cost and features, but also “more [agile]” or “less [agile]”.

·         “Tools that believe” – software infrastructure that embodies the principles (in this case, of agile marketing).
Past examples of movements in the computer industry include Unix, open source, Linux, the Web – and agile software development.
To foster the success of a movement, I think, is a matter of:
·         Encouraging rather than “taming” the enthusiasm.

·         Publicizing the eventual, inevitable large-scale success (P&G?) when it occurs.

·         Moving rapidly to “tools that believe” and small-scale consultants so that new users see it as “safe” to try agile marketing.
And so, I think that agile marketers should join, contribute to, and use the resources and proof points of the agile marketing movement.
My second thought is that I find, in specific situations, “thinking agile” as a strategist involves taking things presented as problems and thinking of them as opportunities: “Getting lemons and making agile lemonade.”  Worried about hacker attacks? Why not design security software to place potential customers in a “sandbox”, and then trade knowledge of them for knowledge of you as a means of determining their bona fides? The hacker will betray himself/herself by his/her desire to access valuable company information without offering equivalent personal information in return – like location.  The valued customer will readily trade appropriate new information about himself/herself, enriching your ability to serve him/her in future. Problem? Opportunity!
And now, I’d like to close by reminding agile marketers of a key reason why the game is worth the candle:  Users report that agile makes you feel good because you are constantly learning and then doing better.  Here’s a story from the late 1990s, in the glory days of computer industry analysts:  I was sitting around with a fellow analyst at Aberdeen Group and we were talking about what was the real reason we didn’t chuck it all and go join some cool new Web startup like Webvan.  “You know,” he said to me in a tone of amazed happiness, “They’re paying us for learning!”
So there’s at least one good reason for agile marketers’ enthusiasm. Taking a 40,000-foot view, learning is where marketing should be headed – and it’s not just going to be good, it’s going to be fun.

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