The marketing technology landscape is like the universe, vast and large. By last count, Scott Brinker of chiefmartec.com counted over 5000 marketing technology vendors. And these solutions—driven by the diverse needs of marketers and the imagination of innovative entrepreneurs—don’t always fit into nice, neat categories.
This contributes to the confusion that many marketers feel around MarTech. There is no standard taxonomy for the MarTech solution space, which makes it difficult to break it down into smaller, more manageable chunks of capabilities.
But after many conversations with research analysts and after reading many great articles on the subject, I’ve developed a simple approach to help make sense of this confusing world.
There are three systems that you need to understand
After spending many years as the VP of Marketing at one of the leading personalization technology providers, I have a pretty good understanding of the benefits and limitations of personalization. And while there are very clear advantages for retailers that adopt a well-designed personalization strategy, I worry about the personalization bubble that has been created. There is irrational exuberance in the marketplace today, an almost mystical belief in the impact that personalization technology will have on a business.
Messages from analysts and thought leaders are fueling this fire. Here are excerpts from an email I just received promoting an upcoming analyst webinar on personalization—sound familiar?
“Personalization is being redefined as individualization—structuring interaction, functionality, and content around the real time individual needs of customers.”
“Discover why individualization, not segmentation, is becoming the new standard for personalization.”
The implication is that with the right technology investments, brands won’t need to do any heavy lifting in marketing. They won’t need to dig deep to understand the differences across customer segments, they won’t need to develop personas, and they won’t need creative breakthroughs to propel their business. Just leave it to the algorithms to crunch the customer data and deliver the perfect message to each consumer at just the right moment. Sounds like magic, right?
As my mother always said, “if it sounds too good to be true, it usually is, unless it’s me.”
In last week’s post I shared some alarming stats on the decline in consumer loyalty today. In a recent research study conducted by ICLP, a global loyalty consultancy, only 3% of consumers felt devoted to their preferred retail brands.
Are we surprised by this statistic given the state of the world today? A recent Gallup poll found that 55% of married Americans have had extramarital affairs. How loyal would you expect consumers to be when more than 50% of them aren’t even loyal to their own spouses? Consumers today are faced with more choices than ever they are bombarded with discount offers, and are quite adept at using price comparison shopping apps and affiliate marketing channels.
So, in our hyper-competitive, uber-distracted world, should we just give up on trying to build loyalty with our customers? How much money should we spend on a losing proposition? Should we just accept the fact that fewer and fewer of our customers will become loyal Lucys and most will be one-time Terrys?
When it comes to their relationship with brands, customers prefer to be polygamous. A recent study published by ICLP, a global loyalty consultancy, studied consumers in Australia and discovered that a whopping majority (97%) would cheat on their favorite retailer. The ICLP study, Deeply Devoted, looked at the psychological similarities between human and brand relationships and found that consumers are in less committed relationships with their favorite brands than ever before, with only 3% feeling devoted to their preferred retail brands.
While the numbers are shocking, the fact that customer loyalty is more elusive than ever is not a surprise. The question is how hard should you work to buck these trends? In the world of mobile shopping apps and effortless comparison shopping, how much should you invest to cultivate loyalty and repeat purchase? How do you measure the positive impact that loyal customers deliver?
Whole Foods’ business is in decline, and they want to respond by offering more discounts and lower prices. A better idea is to focus on their best customers to find opportunities for profitable, sustainable growth.
On February 8th, Whole Foods reported its sixth consecutive quarter of falling same store sales. The company is closing nine stores according to the Washington Post, and is abandoning its plans to grow from 470 locations to more than 1200. Its stock has lost half of its value since it’s peak in early 2015. What is going on?