- There is an ever-growing gap in marketers who have and do not have means to succeed in the digital landscape.
- This podcast explores the opportunity for marketers without big brand budgets.
- In the 1990s, Internet marketing used to be a level playing field. You could build a sizable audience without mass media.
- Smaller paid media budgets used to have an equal opportunity for reach through Google Display, Advertising.com, Google AdWords etc.
- Essentially, David had the same firepower as Goliath. It came down to which marketer had the best tools and which put them to the best use.
- Four key changes in Internet functions contributed to the power shift away from David to Goliath: Content Shock, social media advancements, improvements in digital media targeting and big data.
- Content shock: early content marketers were among a select few. They were able to own their niche. Now, the quest for eyeballs is more competitive and the quality of content has to increase to compete.
- Algorithmic timeline on social media: Unless brands have a budget to promote their content, it’s unlikely to build an audience on social media organically with new timeline algorithms.
- Limited reach and target in digital media: ad networks have evolved to virtual marketplaces selling display, video and mobile ad inventory using real time bidding. Larger pockets tends to give marketers first dibs on better inventory.
- Data is currency: Without large volumes of data to your website, you may not be able to iterate or improve as quickly as someone who does.
How can David beat Goliath? There are a few ways. Marketing automation tools are becoming more accessible to marketers with modest budgets. Many big companies with ad tech don’t always know how to use them, either from a lack of talent, department silos or bureaucratic red tape.
Charity of the Week:
We hope you want to join us on our journey. Find us on IterativeMarketing.net, the hub for the methodology and community. Email us at [email protected], follow us on twitter at @iter8ive or join The Iterative Marketing Community LinkedIn group.
The Iterative Marketing Podcast is a production of Brilliant Metrics, a consultancy helping brands and agencies rid the world of marketing waste.
Onward and upward!
Steve Robinson: Hello, Iterative Marketers! Welcome to the Iterative Marketing podcast, where each week, we give marketers and entrepreneurs actionable ideas, techniques and examples to improve your marketing results. If you want notes and links to the resources discussed on the show, sign up to get them emailed to you each week at iterativemarketing.net. There, you’ll also find the Iterative Marketing blog and our community LinkedIn group, where you can share ideas and ask questions of your fellow Iterative Marketers. Now, let’s dive into the show.
Hello everyone, and welcome to the Iterative Marketing podcast. I’m your host, Steve Robinson, and with me, as always, is the cool, calm and collected Elizabeth Earin. How are you doing today, Elizabeth?
Elizabeth Earin: I am good, but you have not been hanging out at my house this week if you are calling me cool, calm and collected.
Steve Robinson: Well, you at least do a good job of putting on that appearance.
Elizabeth Earin: Thank you, thank you.
Steve Robinson: So, I seem to have a little bit of a problem. I keep buying books and I assume that if I am going to buy it, that means I am going to read it, and I was wondering if you shared that affliction.
Elizabeth Earin: Oh! Yes, yes, and I seem to buy them at a rate that’s much faster than I read them. So I actually have a bookshelf in my hallway that is dedicated to the books that I have purchased and not read.
Steve Robinson: Wow! Okay, then maybe – well, I don’t know. Mine aren’t on a dedicated shelf. Mine are scattered, so maybe you have got me beaten, maybe not. And I am just fooling myself by not putting them all in one place. But what’s at the top of your list or the leftmost position in the shelf that you are dying to read?
Elizabeth Earin: I have got a couple of them, actually. I read multiple books at once, which is probably not good and why I have a hard time getting through them. So I actually am reading — I actually have them right here. The Power of Full Engagement — we actually do a book club –
Steve Robinson: Okay.
Elizabeth Earin: – for Brilliant Metrics and this is part of our book club, so working on that one. And then the mom in me is trying to become a better mom, and so I am reading The Whole Brain Child to better understand my toddler. And then my husband turned me on to this book and I am totally in love with it and tell everyone about it, but it’s Tony Robbins’ Money: Master The Game, and it’s about financial well-being and health. And I am just – I can’t put it down, which means the other two books are being neglected. What about you?
Steve Robinson: So I am woefully behind on our book club book. I will get it done before we actually have book club, I promise, but the two books that just came out that I got that I am just dying to start as soon as I get through the book club book, because I am not allowing myself to start beforehand, are Deep Work by Cal Newport. And this is basically about how to quit being distracted by shiny objects and actually focus and get work done, which I have developed some bad habits as far as that goes. And then along the same lines is a Charles Duhigg who wrote another book called The Power of Habit that’s just phenomenal. This is his book, Smarter, Faster Better, which is all about increasing productivity. And as we all seem to get busier and busier it seems like being more productive would be a good thing.
Elizabeth Earin: So you have to let me know how those turn out. We may have some new additions to our book club list.
Steve Robinson: I think they might end up as candidates. So we are not talking about books today; what are we talking about?
Elizabeth Earin: Today we are talking about a topic that is very dear and near to your heart, and that is marketing have and have-nots.
Steve Robinson: Yeah. So this is something that I have been noticing a trend and I thought it would be a great topic for our podcast, and I think it will be a great opportunity to get some feedback from our listeners, too. So if you have any thoughts, please email us at [email protected]. We’d love to hear what you are thinking, or tweet us up on Twitter. But my observation has been that there is just this increasing gap between those who have means and those who don’t as far as what they are able to accomplish in the digital marketing space.
Elizabeth Earin: So today, we are going to get into a little bit of the background, the history that led up to this taking place, the changes that have given those big brands the advantage, but then how that it’s not all a doom and gloom story, that there is a silver lining and there still is a window of opportunity, but as marketers, we need to start acting now. And so we’ll get into some of those. But I think, to kick it off, do you want to give a little bit of a history of kind of how we got to this point and what has happened?
Steve Robinson: When the internet first came on the scene in the late ’90s — I mean it was around before that, but when the web really became a vehicle for marketing, it was this phenomenal space where it was this level playing field. Anybody who wanted to could build really sizable audience, and all they had to do was put up a blog and help a couple of people find it, and because there wasn’t that much content out there and people were clamoring for opportunities to engage online, you could be a nobody and really create a decent-sized audience, at least percentage-wise, if it was out there. And that continued all the way through up until a couple of years ago where it really was this nice, level playing field.
Elizabeth Earin: Well, because before that, it was — the only way to build that sizable audience was through mass media, and so this sort of opened the door in ways that most businesses had never seen before.
Steve Robinson: Exactly. And then you put social media on top of it back in the “good old days” of social, where all of our timelines were exactly in order of the way things were posted and brands had an equal spot at the table as people. It didn’t matter whether you are a person or a brand, you could build quite a social media following and people engaged and it was great. You could build a community.
Elizabeth Earin: And it wasn’t just in terms of on the organic side. Even on the paid side, the ad networks and the early ad exchanges were still allowing the smaller paid media budgets to be able to come in, same as the big boys, and have a sort of better targeting, more robust targeting. And this was available through things like Advertising.com and Google AdWords Display and AdRoll. And so like you keep saying, it was a level playing field and it was a really great place to be sort of 2001 through 2014 on the digital advertising side, and then social from 2007 to 2013, as the general public sort of came to understand what these platforms were.
Steve Robinson: Yeah, essentially. David had exactly the same firepower as Goliath and it was a matter of who knew the tools the best and who could put them to the best use.
Elizabeth Earin: So what changed?
Steve Robinson: Well, I think it was actually four things that changed. I think that there were four key things that changed in the way that the internet functioned, from a marketing and advertising perspective, that really contributed to the power shifting away from David and towards Goliath here. And those are the growth of content. As Mark Schaefer coined it, content shock would be one of them. The next one is the rise of the social media algorithms, where we move away from that linear timeline. I think advances in digital media and digital media targeting and maturity definitely changed the game there. And then finally, this whole concept of big data and that’s still playing out, but that’s also really driving a division between people who are able to apply and those that aren’t.
Elizabeth Earin: So let’s dive in a little bit deeper into each of these sort of four areas and talk about these, you call them revolutions. And so when we take a look at the first one, content shock, you alluded to this earlier, but back when these platforms started becoming available, if you were using them, you were among a select few that was actually out there and being active. And so there weren’t a lot of alternatives. And so if you had content that you were putting out, whether it was quality or not, you had people following you, you had people reading you and you owned that area.
Steve Robinson: Yeah. If you could find a niche, and there were plenty of them at that time, you could become the voice of authority on the internet in that niche with relatively little effort. Just some good content and consistency and you were there. And a couple of years ago, it became this best practice and everybody started pushing for content. And not just content, but volumes of content, right? Because that was the key to SEO, and that was the key to building an audience was really frequent, consistent publishing. And so you look around today, and it’s hard to find a brand that doesn’t have a content marketing initiative. You can’t find a company website without articles or blogs on it much these days. Now the quality might not be all that great, but they are putting the effort out there, which means it’s really, really hard for any brand to rise above that noise. You are no longer going to own a niche simply because you are publishing consistently, because chances are there’s 3 to 400,000 other brands trying to vie for that same audience, that same attention.
Elizabeth Earin: And I think this is where it’s a little bit complicated, because we have this idea that anyone can go on social media and build a following and build an audience, but that’s not necessarily the case anymore because there are so many businesses and brands and individuals who are out there trying to do that, to really compete that, to your point, that the quality has to be so high. And so there’s this misconception that social media is the great equalizer but that’s not – that doesn’t seem to be the case anymore.
Steve Robinson: No. And consumers, if they are going to give you your time, they are really demanding, like you said, a much higher quality of content, so that means higher production value, that means more in-depth research, that means better infographics and all of that stuff either costs time or money.
Elizabeth Earin: Or both.
Steve Robinson: Or both, and if you don’t have the deep pockets and you can’t monetize that because you have the breadth and reach of a big brand, it makes it very hard to justify putting in that level of effort today starting from nothing.
Elizabeth Earin: Sort of the change of content and how that is part of pretty much everyone’s strategy now. It is one of the ways that this has sort of changed in the last few years. What would you say is the second one?
Steve Robinson: So the second one is really the shift in social media. And you kind of alluded to this earlier that there is this misconception that you can build a following on social and monetize it. And that was true, but two things happened. One, the social networks that we are operating without any revenue model needed a revenue model. And two, Facebook in particular led this charge and realized that if they continue to allow brands to get on the bandwagon of Facebook and publish content organically, brands were going to outpace users in the volume of content that they were producing. And at the same time, users really didn’t want to hear that much for brands. They would much prefer to hear from their friends and family and find out about their nephew’s fifth birthday party much more than finding out about a sale on shoes at Zappos, right? So the social networks decided one by one that they needed to figure out how to be smarter about what showed up in people’s news feeds, because if you gave them everything straight from the fire hose, users would be inundated with way too much content, and most of it not being what they are really there to see. And so this begins the conversion to algorithmic timelines, and Facebook led the charge here and converted back. And it was five or six years ago or so, and since then, every single social network has fallen. Now Instagram is algorithmic, now Twitter is algorithmic. And what that means as a brand is that your content won’t get through unless the algorithm deems it as being more interesting to the consumer than their own nephew’s fifth birthday party, which is a pretty high bar as a brand. It also plays really nicely into the fact that, now they have a revenue model, because if you want your content to show up, you can always pay for that, right?
Elizabeth Earin: Exactly.
Steve Robinson: So I know that we see this with our clients coming to us on a regular basis and saying, “Can’t we just build our organic following on Facebook and on Twitter?” And the reality is no, you have to pay for it and as David, that budget is not always at your disposal.
Elizabeth Earin: I think that’s a really great point.
Steve Robinson: So what’s revolution number three here in my notes?
Elizabeth Earin: Revolution number three takes a look at media access, specifically reach and targeting. And I talked about this in the beginning, but in the early days of the ad networks and the ad exchanges, which was I guess sort of the late ‘90s, early 2000s, everyone was given the same access to advertising. It was new, and so people were trying to figure out how to use it, and so there wasn’t this sort of have and have-nots division yet. The publishers were selling ad space directly and gave whatever the leftovers were to the ad exchanges and the networks, and then whoever was purchasing from them had the ability to buy whatever was available. The ad networks, which started into the mid to late ‘90s for those of you that sort of don’t know, aggregate the ad space from the publishers and sells it to the advertisers. And so it’s an older model but it is still popular, and we see this today with Google AdWords, Advertising.com and AdMob. The ad exchanges sort of is where that evolution started, and it evolved from ad networks in the late 2000s. And it became this virtual marketplace, used to sell display and video and mobile ad inventory using the real-time bidding model. And what that did is it gave marketers more control so that they could choose the ads that they wanted at the price that was right for them. And today, we still see this in DoubleClick and OpenX and AppNexus and Yahoo Exchange, and there’s a whole bunch of different people who are doing this. And so with the advent of the AdExchange, what’s happened there is that the deals are not as fair because larger pockets mean that you are going to get first dibs on that better inventory.
Steve Robinson: Right. Initially, the exchanges were a level playing field, because all of that ad space went out on the exchanges. What happened was the bigger agencies, the more premium brands were saying, “I don’t want remnant inventory. I want quality inventory and I want to pay for it programmatically. I don’t want to have to go through a rep to buy it.” And so what sprung up is these private exchanges, where the deals occur on the side before the inventory is bought, but then it is able to be bought without a human involved and it sets up sort of this cascade, whereas a publisher – the rate that a publisher gets on a display ad has been dropping every year since the first display ad. And the way that publishers are combating this is obviously they still try to sell direct where they can get a premium, but if they can’t sell direct, then they go to the next best source for revenue, which is usually one of these private exchange type deals. And then it goes to another maybe more public exchange or a niche ad network. And then if they can’t sell the impression, then it goes on to another public exchange that maybe has lower rates because it’s lower quality inventory. And then it’ll drop down to the Google AdWords Display, the AdSense network. And what this means that, as an advertiser, if you can’t get into one of those premium exchanges or one of those private exchanges, you are not getting the higher quality inventory. You are stuck with only the remnant stuff while the bigger brands, the bigger media agencies, are able to get that more premium inventory. And there’s a big difference in performance of stuff that’s shown up in the footer versus the stuff that’s showing up above the fold on the main pages of the site for well-known websites, and it really takes away the ability for David to even access that, because in order to get to it, you have to be spending big money, because the good networks have minimums. Getting access to a private exchange means that you have got to have some oomph behind your buying power.
Elizabeth Earin: And this blows me away when we talk about this, because so many businesses and so many brands, sort of the backbone of their digital buying strategy is AdWords. And when we are talking about this, AdWords is the bottom rung of this ladder. And so anyone can still buy the ads on Google AdWords, but your ads are showing up in a poor position and on — sometimes — those crummier websites. And that’s what’s so scary about this is that in some cases, that’s a brand’s entire digital strategy.
Steve Robinson: Absolutely. And there’s no way you can compete there. I mean we have seen it. The results when we take a client off of AdWords Display and put them on DoubleClick exchange, it’s night and day. The improvements in click-through rate and quality of traffic, and so it’s sad. The next one here is Big Data, and this is really unfolding right now in front of our eyes. And it’s fascinating to watch and also a little bit disheartening as it adds fuel to this fire of dividing the haves and the have-nots. But you hear the phrase batted around that data is currency, and I think that has a lot of weight.
Elizabeth Earin: It is, and it’s currencies what people find value in, and right now, it’s data. And I shouldn’t say right now. I mean, there’s — we have been talking about data for a long time, and CRM and data mining and sort of everything that goes into that, that’s been discussed for years, but it feels like it’s all coming to head right now. And in fact, there was a paper published in 2013 called “Data is the New Currency,” and this — I found it so interesting, but it reported that 90% of the world’s data has been created within the last two years.
Steve Robinson: Wow! And we have seen it play out in our work that data can be really powerful. I think that where the smaller guy gets hosed on the data angle is really on two fronts, though. And one is volume. If you compare a small website’s volume of traffic to a big brand, you are talking factors of 10, 100, 1000, and the amount of traffic that you are getting. Every visitor is another set of data points. The larger the audience you have, the more data you have and the faster you can iterate when you are testing things, the more segmented and narrow you can make your audiences and still be able to have a positive return on investment and in creating personalized experiences for them. When you have a small upstart, it gets really expensive and really challenging to even identify your segments in the data when you have a small audience.
Elizabeth Earin: Well, if you don’t have the data, then you can’t analyze it, and if you can’t analyze it, then you can’t aggregate it and personalize that experience and so you miss out on some of those opportunities.
Steve Robinson: The other issue is in the tool set. So what we are finding is that the tools are getting better and better, but they are enterprise-class tools. If you want a good business intelligence dashboard, you are going to pay for it. If you want to be able to put your data in a data warehouse and be able to truly manipulate it and pull those insights out of it and use artificial intelligence, some of that stuff is available at a consumer level, but the good stuff is really at a much higher level and/or you have to pay to get a data scientist on your team and they don’t come cheap either.
Elizabeth Earin: Either of them are cost prohibitive for small businesses, and so when we are talking about this data, I want to see if we can maybe clarify this for our audience, but what kind of data are we specifically talking about?
Steve Robinson: Well, the two places that I think that the data is impacting marketing as a practice most are in audience data. So understanding your audience’s preferences, their psychographic components, what do they think and feel and figuring out how to put them in a logical segments. And if you have a lot of first-party data, you can do a lot with that. And a great example of this is Kraft. And I think we talked about them on the podcast before, but Kraft owns kraftrecipes.com. Well, kraftrecipes.com, it’s in the top 2000 websites in the globe, okay. So that doesn’t sound all that important until you think about the fact that it’s just recipes. That affords them the ability to segment their audiences hundreds of ways based on their food preferences, because you only look at recipes that look appetizing, right? And so, if you come in as an upstart of a food products company, you are not going to have access to that data. Kraft holds that data. Now you can buy some data. As a matter of fact, you might even be able to buy Kraft’s data. There are now marketplaces where brands can sell their own data to other brands, but you are going to pay for it. And chances are as the guerrilla marketing, digital marketing, small upstart, you are not going to have the budget for that. I think this second kind of data that we are looking at is predictive data, and this is the intelligence that will go out and figure out based on people’s browsing patterns, either on your website or on other web sites on the web, who is in market for your product or service. And you see these players coming up all over the place, from Mintigo to EverString to The Big Willow. There’s all these predictive marketing companies. All of them have slightly different products, but none of them are really ideal for the SMB space. They are all really targeting more enterprise-type companies, and the pricing reflects that.
Elizabeth Earin: Just thinking about the fact that the big brands have access to data that most smaller brands, and most brand in general, don’t, if that weren’t enough, there’s another sort of area where the big brands have the advantage, and that’s that — in their ability to have access to tools to analyze the data that they have.
Steve Robinson: And we talked a little bit about the business intelligence tools already and having a data scientist, but there’s also other tools like your DMP tools. And these allow you to take your existing first party audience as the people that are on your site, add more and richer, richer data to those audiences. So this is tools like Krux or Adobe Audience Manager and those tools come at a price point that is way out of reach of any SMB. And there is no SMB equivalent today that hasn’t trickled down, and I don’t know if and/or when it will trickle down. I would love to see some startup figure out how to take that model and make it understandable to a smaller business and at a price point that would work for a smaller business.
Elizabeth Earin: Well, I don’t know. Maybe one of our listeners out there is working on this right now, so if you are, reach out to us. We’d love to hear.
Steve Robinson: Absolutely, absolutely, or if you know something. So I think that we kind of talked about those four big revolutions, content shock, the growth of content, social media, throwing a monkey wrench in everything with the algorithmic timeline, we talked about media access and paid media and how that’s been out of reach for a lot of small businesses, and then finally this idea of big data and big data being the fourth thing to fall here, and really separating the haves and have-nots. Kind of sounds doom and gloom-ish, right? This is not exactly the pretty picture that we’d like to paint. I think when we get back from talking about how we can help some people here, we will go through how – there is a silver lining, there’s an opportunity. So please don’t leave us thinking that the world is ending here, because I think there’s still an opportunity for David to be Goliath.
Elizabeth Earin: Before we continue, I would like to take a quick moment to ask you Iterative Marketers a small but meaningful favor, and ask that you give a few dollars to a charity that’s important to one of our own. This week’s charitable cause was sent in by Tracy Stanton of 30 Fortunate Giving and founder of the Fortunate Movement. Tracy asks that you make a contribution to the Future Leaders of Our Community, an organization bringing awareness, inspiration and participation opportunities to young professionals. Learn more at www.flocers.org or visit the link in the show notes. If you would like to submit your cause for consideration for our next podcast, please visit iterativemarketing.net/podcast and click the “Share a Cause” button. We love sharing causes that are important to you.
Steve Robinson: Welcome back. So we talked doom and gloom before we left. Now let’s talk about the silver lining.
Elizabeth Earin: At the beginning of the podcast, we had mentioned that there is that silver lining. There is a way for regular brands, everyday brands, to be able to compete with some of the big boys. And a lot of that comes in the fact that some of these tools are starting to trickle down. Specifically when we look at marketing automation platforms, these are now accessible with modest budgets. We have got programs like Marketo and HubSpot. If that’s still outside of your budget range, ActiveCampaign is a great option. And then I think you had just read about a free open source app that had come out as well.
Steve Robinson: Yeah. Christopher Aspen turned me on to this. I was really impressed, I’d never noticed it before, but there’s a free and open-source marketing automation platform out there called Mautic. We will link to it in the show notes, but it looks to be pretty robust. And if it’s good enough for Christopher Aspen, it’s good enough for me. So he has got a great series out on his blog of a video series out on YouTube of him actually adopting this tool. It’s pretty good if you get a chance to go watch it, but I think the key here is that these tools, which really can give you a lot of power, at least in managing small data, your own audience and understanding who they are and segmenting them and personalizing content to meet their needs, that is becoming more and more accessible every day. And I think that’s exciting because these tools can actually be really powerful in managing, maybe not big data, but the small data that you own and putting that to good use in a cost effective manner.
Elizabeth Earin: That is exciting and that’s a great opportunity, and I think when we had first introduced this topic, we said that that window was still open. And I think one of the areas that we need to talk about as to why that window is so open is because a lot of the enterprises that do have the tools that we talked about in our last section, they have the tools but they are not necessarily using them or using them in the way that they were intended. And so I think this is one of the areas where there’s a big opportunity and where the time is sort of important here, because eventually, they are going to start using them. And then that gap is going to get bigger, but right now, there’s still that opportunity to kind of jump on board and catch up. And so I know you have witnessed this or experienced this where you have seen the big brands, you have some of these tools in place not actually using them.
Steve Robinson: Yeah. Matter of fact, a while back I was at the Marketo Summit. I am sitting there during the keynote, talking to the guy next to me and he turns to me and I said, “Well, what do you do?” He said, “Well, I just got a new job.” And I said, “What’s that?” And he said, “Well, I was hired on. Today is technically my first day, because the company I was working for has Marketo and all they are doing is sending an email newsletter with it.” And I said, “Really?” And he said, “Yeah.” And I can’t say the company, but it was not a small company. And that’s not the first time I have heard that story. That’s not the first time that I have gone and checked out a company that we are in talks with, checked out their website. I see marketing automation, I see even DMPs on their website and I see some of this advanced technology where they are tracking users on their site. Ask them what they are doing with that information. Ask them how they are turning that around into business results and they’ll say, “Well, we have the tools but we are not really sure how to use them yet, and we don’t really have anybody on staff at this point to really put them to good use.”
Elizabeth Earin: And so I think that kind of gets into sort of the first part of why this is happening, and there’s just this lack of available talent. People who have a strong understanding of these platforms, not just marketing automation, but some of these bigger platforms, they are in high demand and there are not necessarily a lot of them. There’s more on the marketing automation side, because it’s been around for a while and there’s a lot of different levels, so different businesses are able to participate in it. But when we talk about some of these other programs, the ones that are sort of out of reach for the normal business, there’s not people with experience, and so companies are struggling to find experienced ad tech people who can effectively and efficiently run these programs.
Steve Robinson: Yeah. I mean you look at Scott Brinker’s landscape of the digital marketing software space, and any one person who even knew what half those companies did would be an anomaly or an amazing thing, right? So to find the expertise, who not only knows what’s possible from a technology perspective, but has the solid marketing foundations to be able to put it to good use along with the technical expertise and knowledge to understand the data science behind it to the extent that they can really understand how to segment and target media and personalized experiences down to the right level without messing it up, and that talent just doesn’t exist nearly enough to fulfill the demand.
Elizabeth Earin: So that’s sort of the first hurdle, which is a big one in itself. But let’s suppose here that your brand has been able to find someone who is knowledgeable and has the marketing background and can manage this program. They still face another issue, and that’s even if you have someone who is championing this idea and who gets the program. They are still trying to battle the cultural shift about turning into data-driven marketing environments. And so they are constantly fighting against the idea of ‘this is how we have always done it,’ and so they have to find a way not only to set this program up and run it, but they have to get everyone else on the organization on board, and that itself is a huge task.
Steve Robinson: And maybe some of our audience are these people, and they are fighting these battles every day. So this is the preaching to the choir, but it’s hard, because it’s not just marketing that needs to be able to be thinking data-driven. It’s sales. It’s customer service. These tools don’t work well if marketing is the only one that has any say in how they are implemented, or the only ones using them, and so it’s an uphill battle. I think there’s also a degree of a bureaucratic red tape within a lot of larger companies as well, and this is really, I think, one of the biggest advantages of being a small company, is if you are going to implement strategies that are data-driven, if you are really going to engage in personalization, you don’t have to go through eight layers of approval for every tool you want to add, for every persona you want to introduce, for any content efforts supporting that particular experience or persona, even media it’s all – you are able to make those decisions much more rapidly. And once you throw stuff out there, you can analyze the results and make adjustments on the fly a lot more easily. So you can practice what we preach here with Iterative Marketing and really be able to truly iterate a lot faster if you don’t have to get approval for every minor budget change or every little content direction shift.
Elizabeth Earin: I have been there and you can have such great momentum with your internal team, and the bureaucratic red tape just can stop you in your tracks.
Steve Robinson: I think the last thing that — the last opportunity here is it comes back to that — the nimble bit. In that if you are a big brand, it’s really hard for you to take control of your customer experience often, because you are built on a legacy business model. So, if you think about how has Dollar Shave Club really begun usurping Gillette, right? And the answer is they came up with a new business model that didn’t have any of the distribution channels that Gillette has. If Gillette started selling their razors directly, which I think they do through another brand right now, but if they did that under the Gillette brand, it would undercut their current distribution network and they would kill themselves. It’s the innovator’s dilemma. As a new company, you can come up with new ways to reach your market and reach your market directly in a personalized manner using these tools to their full effect, while the big guys are still stuck trying to understand the ramifications of interacting directly with their audience without destroying their current business.
Elizabeth Earin: Now, I think it’s important here to note that not all big brands are doing this wrong. There are some people out there that have really figured this out and are leading the market. And if you want to see companies that are doing this, you mentioned Kraftrecipes. Amazon, Amazon is constantly improving the recommendation engines and that’s taking hundreds of data points into account. And they are doing some really amazing things, constantly innovating. Another great example, Nordstrom is one of my favorites. They use big data from their deep social data across multiple platforms. They have a credit card, they have got their fashion rewards program, they use all of those different data points to improve marketing and product design. And not only that, but they have actually created what they call the Nordstrom’s Innovation Lab, which develops and tests new products that merge the online and offline behaviors of their shoppers from interactive touch screens in their fitting rooms to using sensors and wifi signals to attract shoppers as they are moving through their stores. And you see this if you are a Nordstrom shopper, you know what I am talking about. In their communication to you, it’s very, very personalized and it’s companies like these that are raising the bar.
Steve Robinson: And I think if there’s one key message from today’s podcast, which I know is a little longer than normal and a little bit more ranch-ish than normal, send us feedback, please, at [email protected]. But it’s that – there’s a window today. While the bigger organizations are still trying to figure out what the digital revolution means to them, while they are still trying to find the talent to implement these new technologies and new opportunities at scale, there’s a window for smaller brands to find the tools that are within reach, hack their way around the ones that aren’t, and deliver better personalized experiences and really out-compete the big boys simply because they are smaller, more nimble and have the ability to iterate and improve faster. And so what I want to – if there’s a message to drive home to all of our audience that qualifies as this smaller brand, now is the time. Up your skills because you can still outsmart your competitors and David can still beat Goliath, but that window is closing and now is the time to do it.
Well, I want to thank everyone for making the time for us this week, because I know time is precious. And until next week, onward and upward.
Elizabeth Earin: If you haven’t already, be sure to subscribe to the podcast on YouTube, on your favorite podcast directory. If you want notes and links to resources discussed on the show, sign up to get them emailed to you each week at iterativemarketing.net. There, you’ll also find the Iterative Marketing blog and our community LinkedIn group, where you can share ideas and ask questions of your fellow Iterative Marketers. You can also follow us on Twitter. Our username is @iter8ive or email us at [email protected].
The Iterative Marketing Podcast is a production of Brilliant Metrics, a consultancy helping brands and agencies rid the world of marketing waste. Our producer is Heather Ohlman with transcription assistance from Emily Bechtel. Our music is by SeaStock Audio, Music Production and Sound Design. You can check them out at seastockaudio.com. We will see you next week. Until then, onward and upward!