How To Keep Customers Coming Back: 6 Trends You Should Know

by Eric Tsai

Living in southern California I love going to restaurants, cafes and retails stores to experience what companies are doing to attract customers.

From merchandising to customer service, I’m gradually seeing three popular marketing trends that everyone is doing to spread their brand voice.

First, almost every company is in on the social media bandwagon specifically leveraging Facebook and Twitter to engage with their fans and broadcast their offerings.

Second, companies are finding ways to collect your contact information to build their email list by offering discounts, coupons or customer loyalty programs.

And third, businesses are aware of their reputation online on places such as Yelp, Consumer Reports, OpenTable, BizRate, Amazon and CNET.

Some of using these information as a way to improve products and identify service gaps.

All three marketing tactics are proven to be somewhat cost-effective in terms of managing their reputations online while funneling leads and converting sales.

There is enough free information out there that business owners and marketing managers can find to start immediately so I’m not surprise that everyone is doing it.

In fact, I always check out the Twitter or Facebook page of where I’ve visited to see what level of engagement and following they have as well as to identify how the platform was utilized.

The result I found is that companies fall into two categories of social media marketing buckets.

First are the highly engaged profiles with regular updates and a large following that creates instant social proof. Second are the uninspiring profiles with the lack of updates and little to no interactions.

This is the same observations made by Jeremiah Owyang, who recently posted on his blog that, “many brands are jumping on the social media bandwagon, without giving proper thought about the impacts to their marketing effort. In particular, many brands are putting ’social chicklets’ on their homepage to “Follow us on Twitter” or “Friend us on Facebook” without considering the ramifications.”

This is the problem with low barrier to entry tools such as Twitter and Facebook that many brands are using without a real deliberate strategy.

I encourage those of you that are serious about your digital marketing efforts to use Jeremiah’s matrix to help make your decisions.

Keep in mind, you must understand not just the rules of the game but also how it applies to your specific industry, your customers and your organization.

There is no doubt that the internet has made it easier to find what you’re looking for while connecting you with like-mined individuals from networking to referrals, relevant information is available in abundance.

The questions is where do people get those information and how will these content providers be perceived?

First you need to realize that all of the answers have changed.

Same Questions, Different Answer

Although the internet has forever changed our expectations in media consumption and in communication, one thing remains constant for businesses today: the question of how do we attract more customers to us?

How do we get customers to spread our brand? How do we get customers to buy more and buy often?

As a marketer today you must realize that we’ve been asking those same questions for decades and in order to answer them now you must first understand the following 6 fundamental social change in customer perception and behavior:

1. Choice overload: Customers are bombarded with choices; the market is saturated with selection.

And people get frustrated when they have to make a decision from tens and thousands of product categories, brands and price points.

Everything looks the same, everyone sounded alike and it doesn’t help when people have shorter attention span as we become more distracted everyday.

2. Conflicting information: We’re in a hyper-connected marketplace where people are using social media to discuss new products, do their own research, cross referencing information in the blogosphere and everything goes from frustration to confusion.

There is simply too much information and how can an average consumer know who’s right and who’s wrong?

3. Customers know marketing: Over time, customers understood the game of marketing regardless of B2C or B2B.

Described by Tom Asacker: We’re no longer passive consumers but active discerners participating in how products are marketed at us.

This is why there is an increasing trend in banner blindness and average web users will give you only 8 seconds to decide if they’re going to stay or not.

4. Lack of trust in the marketplace: There is a sense of distrust in the marketplace. People simply don’t trust individuals let alone corporations.

We’re conditioned to identify the tactics such as sense of urgency (buy now and save!), risk reversal (money back guaranteed!), or scarcity thinking (for a limited time!).

Watch any TV infomercials and you’ll find those tactics in most of them.

Simply put, these tactics are losing their effectiveness and even if they worked that led to engagement opportunities, you must meet the customer expectations otherwise it’s hard to fool them twice.

5. People define your brand: Brand messages only sets the initiate expectations of your target audience and ultimately people make meaning out of things themselves.

When push comes to shove, people go with what feels right not your product features or service benefits.

It’s how you make them feel, not what you tell them how they should feel. If they can relate to your message, it only means they’ll give you a few more seconds to keep going down your path to purchase.

Your brand is defined by how you make people feel about the decisions they’ve made not just your messages.

6. The shift towards frugality: This is the simplest concept to grasp as the recession has permanently changed the way consumers behave and perceive value.

It goes beyond pricing strategy and product promotions.

Whether you’re a retailer, a B2B service provider or a marketer, this means extracting deeper customer insights to build meaningful, differentiated messages that communicates relevancy.

This is best described by a recent article “The New Consumer Frugality” in Strategy+Business, by Booz & Company, in which the authors defined six frugal consumer segments.

After a thorough understanding of the above trends, you should also be aware of the fact that brands are becoming publishers creating opportunities that’s leveling the playing field.

And in order to be successful moving forward, you either have great content strategy or you have unique customer experience (in product or service innovation).

Content Marketing Creates Relevancy

Recently Joe Pulizzi of Junta42.com, a content strategy evangelist published a post after speaking at the Online Marketing Summit 2010 on how companies focus solely on Search Engine Marketing (SEM) and social media that produce without a real content strategy.

Specifically he noted that “any online marketing, whether social media, email marketing, search engine optimization, landing page conversion, etc., does not work without first having content strategy.”

As a brand strategist that focuses on marketing integration, I couldn’t agree more.

I’ve heard business owners and marketing executives realize the need to change their strategy, but it’s often due to the need to “keep up” with the current trend. “We must get into social media because everyone’s doing it,” or “We need to engage our customers on Facebook and Twitter.”

But what does engagement mean to your organization? How will that benefit your bottom line or increase sales?

It’s easy to setup a WordPress blog, a Twitter account, a Facebook fan page or a LinkedIn Group.

The key is what will you be pushing out to generate meaningful conversations?

How will you provide value that sparks engagement?

Why would people spread your idea or pass on your name?

What’s the call-to-action when people get to your website, your blog, or your social media pages?

Product Innovation Creates Loyalty

The other way to win in the marketplace is to deliver awesome products or services that build brand loyalty via innovation.

An easy example would be what Apple is doing with their continuous innovation in products from iPod to iPhone to last weekend’s release of iPad.

Amazon’s endless pursue to have everything available, fast and easy via their online store regardless what you’re looking for.

Zappo’s unmatched customer service in finding and delivering not just the shoes you ordered but what you may also like.

For restaurants, it’s the food you cater, the service you provide, the price tag you put on as the total experience that says “we’re different.”

Customers will automatically go on to Yelp and OpenTable to give you reviews and recommendations. Your customer will decide what quality is and what value means to them.

I love what James Surowiecki wrote in an excellent piece in The New Yorker: “the more information people have, the tighter the relationship between quality and price: if you can deliver a product or service that is qualitatively better, you can charge top dollar. But if you can’t deliver the quality you can’t get the price.”

You’re going to struggle if you don’t deliver brand experience that’s worth talking about.

Everyone have access to the same tools and resources, if you can deliver a mix bag of value using content marketing strategy on your innovative products, you win.

The take away: Brands must adapt to the new realities that everyone is a content producer and we are no longer competing on eyeballs and clicks only, but value that builds long-lasting relationships in a trust-driven era.

It is essential to establish clear, integrated marketing strategies for various media channels in order to deliver personalized messages that properly aligned with your business objectives.

If you don’t know your desired outcome, why are you implementing tactics where you can’t see what success means to you?

If you don’t have exceptional products perhaps its time you should rethink your product strategy.

Are you re ready to get actionable to integrate your marketing efforts?

When to Adopt Social Media for Your Business?

by Eric Tsai

What happens when hype is no longer hype but a real trend? Can you afford to miss benefiting from social technologies?

These are questions I get about using social media as part of the brand strategy conversations. This is when I introduce the theory of Technology Adoption Lifecycle (aka Rogers’ bell curve) to illustrate product adoption to better understand how new ideas and technologies spread especially in today’s digital culture.

roger's-bell

Fundamentally Innovators seek new ways of doing complex tasks and are willing to take the risk hoping to gain competitive advantage over time.

The Early Adopters want speed and cost savings to drive other innovations that’s mostly perceived advantage.

I see the rest of the adopter groups (early majority, late majority and laggards) as Mass Market. This group relies heavily on the concept of social proof and wants proven process from credible source that demonstrates significant cost savings over the existing way of doing things.

Now let’s apply this concept to social media.

Adopting at the Right Time

The idea of adopting new technology is to improve productivity and fuel growth, not to chase the hype or follow the trend for the sake of doing it.

You need to ask yourself this: How much risk are you willing to take investing (time, resources, money) in social media? Does your organization have the resources to execute the adoption of this new platform?

Regardless of how mature social media is, it has to fit within your brand strategy.

Don’t get me wrong, the timing of adoption is important and it could bring unexpected opportunities, but not if you’re unable to optimize the value from it.

You need to have the right adoption strategy at the precise time that gives you the longest lifetime value at an acceptable level of risk.

You can see some examples of mergers and acquisitions by companies attempting to harness innovation in the adoption lifecycle. Recently eBay sold Skype for $1.9 billion and acknowledged “that it had overpaid for Skype by about $1 billion — the purchase price was $2.6 billion but the Times has reported the total cost reached $3.1 billion after bonus payouts to founders.”

Being a happy Skype user myself, I know the value of Skype today but eBay’s timing of the acquisition was simply off not to mention it didn’t fit with their business model.

A better approach would be to find something that aligns with their line of business in auction listings, classifies and ecommerce. EBay does own paypal, which is a great buy because it actually enhances their online auction business and helps to extend their brand to reach more customers. Looking from the hind side, a company like Craigslist (they do own 25% of it) would probably make more sense to go after.

One factor to keep in mind is sustainability of social technologies. This can be seen by the rapid adoption of the earliest social technology: email.

As a technology spreads widely, the economy of scale expands but its value will start to shrink.

Email is supposed to improve our communication and productivity but as we’re at the end of adoption lifecycle spam has exploded, “now accounts for 90.4% of all e-mail,” costing us more time, resource and money to manage email.

When a technology starts to get commoditized, it’s time to innovate.

This is why companies like Google is re-inventing the email landscape with Gmail going heads on against Microsoft’s Exchange email.

For social media one could argue that we’re still in the Early Majority section of the Mass Market and we’ve yet to see the explosion from the Late Majority section.

Regardless, the adoption of social media will continue to grow according to Forrester Research. I like their consumer social technology profiling tool that allows you to check the profile of your customers.

Take away: Adopt social media for your brand when you’re ready, even just to experiment, you still need time and resources. Focus on aligning your brand strategy to help you achieve your business goals. If you need social media strategy, you can start with this.

Are you an Innovator or an Early Adopter?

The 12 Principles of Brand Strategy

by Eric Tsai

In a situation where you’re selling to multiple personalities, it’s best to first connect everyone on a common ground then articulate clearly what’s in it for each of them.

The goal is to stimulate an engaging conversation that allows us to change perception, diagnose expectations and bring clarity to the dialogue.

That’s the essence of developing a brand strategy – the foundation of your communication that builds authentic relationships between you and your audience.

It is by defining your brand strategy that allows you to utilize marketing, advertising, public relations and social media to consistently and accurately reinforce your character.

Without defining the core strategy, all channels of communication can often become a hit and miss expense.

Here’s 12 brand strategy principles I believe to be the key to achieve business success.

1. Define your brand

It starts with your authenticity, the core purpose, vision, mission, position, values and character. Focus on what you do best and then communicated your inimitable strengths through consistency.

There are many examples of companies acquiring other brands but only to sell them off later because they don’t fit within the brand and its architecture.

Microsoft acquired Razorfish in 2007 when it bought aQuantive, a digital marketing services company, for about US $6 billion then sold it a few years later for $530 million.

Simply put, Razorfish isn’t a good fit with Microsoft’s brand strategy.

2. Your brand is your business model

Supports and challenge your business model to maximize the potential within your brand. Think of personal brands like Oprah, Donald Trump, Martha Stewart and Richard Branson.

These individuals practically built their business right on top of their personal brand; everything they offer is an extension of their brand promise.

3. Consistency, consistency, consistency

Consistency in your message is the key to differentiate.

Own your position on every reference point for everything that you do. President Obama focuses on one message only during his campaign, CHANGE. BMW has always been known as the “ultimate driving machine.”

4. Start from the Inside out

Everyone in your company can tell you what they see, think and feel about your brand. That’s the story you should bring to the customers as well, drive impact beyond just the walls of marketing.

That’s example how Zappos empowers employees to strengthen consumer perception on its brand.

5. Connect on the emotional level.

A brand is not a name, logo, website, ad campaigns or PR; those are only the tools not the brand. A brand is a desirable idea manifested in products, services, people, places and experiences.

Starbucks created a third space experience that’s desirable and exclusive so people would want to stay and pay for the overpriced coffee.

Sell people something that satisfies not only their physical needs but their emotional needs and their need to identify themselves to your brand.

6. Empower brand champions

Award those that love your brand to help drive the message, facility activities so they can be part of the process.

If your brand advocate doesn’t tell you what you should or should not be doing, it’s time to evaluate your brand promise.

Go and talk to someone that works at the Apple retail store or an iPhone owner and you’ll see just how passionate they are about Apple. It’s a lifestyle and a culture.

7. Stay relevant and flexible

A well managed brand is always making adjustments. Branding is a process, not a race, not an event so expect to constantly tweak your message and refresh your image.

Successful brands don’t cling to the old ways just because they worked in the past; instead, they try to re-invent themselves by being flexible which frees them to be more savvy and creative.

Here is an example: when the economy tanked this year automaker Hyundai came out with an assurance program that lets you return your car if you lose your job with no further financial obligation and no damage to your credit.

The results?

As of end of February, only two buyers have taken advantage of this program but it has boosted their sales by 14% year-over-year in Q1, only one of the two companies increased revenue while companies such as Honda experienced a drop of more than 30%.

Follow by that campaign in July, as gas prices expected to push higher during peak summer travel months, Hyundai came out with another program that guarantees a year’s worth of gas at $1.49 per gallon on most models.

8. Align tactics with strategy

Convey the brand message on the most appropriate media platform with specific campaign objectives.

Because consumers are bombarded by commercial messages everyday, they’re also actively blocking out the great majority of them.

Invest your branding efforts on the right platform that communicates to the right channels.

Television may be expensive but it has a broader reach, wider demographics and can produce instant impact. On the other hand, social media may seem cheap but it takes time, resources and may not give you the desire outcome.

9. Measure the effectiveness

Focus on the ROI (return on investment) is the key to measure the effectiveness of your strategies.

Often times it is how well your organization can be inspired to execute the strategies. It could also be reflected in brand valuation or how your customers react to your product and price adjustments.

Ultimately it should resonate with sales and that means profitability. But don’t just focus increasing sales when you could be getting a profit boost by reducing overheads and expenses as well.

Give yourself options to test different marketing tactics, make sure they fit your brand authenticity and aligns with your strategy.

10. Cultivate your community

Community is a powerful and effective platform on which to engage customers and create loyalty towards the brand.

In an active community, members feel a need to connect with each other in the context of the brand’s consumption.

We all want to be an insider of something, it excites us to tell people which community we’re part of and what knowledge we posses.

In many ways it’s our ego that prides us to be part of a sports team or a professional group.

Guess what car would members of the Porsche club consider first when it’s time to purchase their next vehicle?

Brand communities allow companies to collaborate with customers in all phases of value creation via crowdsourcing such as product design, pricing strategy, availability, and even how to sell.

11. Keep your enemies closer

Even if you have the most innovative, highly desirable product, you can expect new competitors with a superior value proposition to enter your market down the road.

The market is always big enough for new players to improve what you deliver better, faster, cheaper. Call it hypercompetition or innovation economics, competition could be good for you believe it or not.

It challenges you brand to elevate the strategy and deliver more value.

Just look at how the Big Three (automobile manufacturers General Motors, Ford, and Chrysler) got crushed in the past decade by competitions from Germany and Japanese.

Not only do their competitors make a better product, they’re more efficient doing it and command a higher brand loyalty.

In 2008, Toyota overtook GM while Honda passed Chrysler in US sales.

12. Practice brand strategy thinking

IDEO’s CEO Tim Brown calls design thinking “a process for creating new choices.”

Essentially it means to not just settle for the choices currently available but to think outside the box without being limited.

This concept actually applies to your brand strategy creation process that I called brand strategy thinking.

It’s always easier to execute tactics than coming up with a strategy because it implies the possibility of failure.

It’s much faster to emulate what worked for your competitor than to come up with something original and creative.

But the truth is, that’s not you and it violates the first principle of brand strategy. Brand strategy thinking is about creating the right experience that involve all the stakeholders to foster a better strategy.

Leverage the ecosystem that includes your employees, partners and customers to help you articulate your brand strategy so they sync together.

The take away: Having a brand strategy will bring clarity and meaning to your brand so you can focus on making, creating, and selling things that people actually care about.

If you could do that, your brand would be unique and memorable on its way to become an esteemed brand.

Are there any you disagree with?

Let me know if I’m missing anything.