Skip to content

Confessions of a Marketer

How we create reality for consumers & crush smaller businesses, like yours.

By Adam Hoffmann

 

I’m going to tell you the story of the worst thing I’ve ever done as a marketer. This is hard to write because I’m confident that you will think less of me after reading it. However, I’m willing to tell you my story, because I believe that if you don’t understand the sophistication and power of modern marketing your competition will hire people like me and those people will put you out of business.

Don’t believe me? Here’s my story:

In the Summer of 2013 I was hired to work for a respected, mid-sized marketing agency. I was thrilled by the opportunity because I would be working with clients that included IBM, GE, Google, American Express, Staples and a dozen others. You get the point. I felt like I was in the big leagues.

As soon as I arrived, I was given a folder that contained the research and previous deliverables for my first client; a well-known identity theft protection company. I was then told that I would be responsible for managing the marketing efforts for our client’s B2B partner programs. Just to give you some context, this was a small opportunity to test the new guy. I was only responsible for $1M in annual agency revenue, $1.5M in ad spend and I was holding $500K in research.

You know, small.

Ready to prove myself, I immediately began reading the executive summary. To be fair, I read this seven years ago, but here’s what I remember.

  • Most people think that identity theft takes up to 18 mo. to resolve and victims lose a lot of money.
  • This perception was established a decade ago when identity theft spiked and news outlets ran constant stories about it.
  • Recently, very public data breaches have reignited fear about identity theft.
  • People who are very busy, have low incomes and/or have a limited understanding of technology are most concerned about becoming a victim of identity theft.

Not so bad, right? Well, keep reading.

  • Our research shows that perceptions about identity theft are not true.
  • This is because banks, credit card companies and credit bureaus have effectively solved the problem for most consumers over the past ten years.
  • Currently, the average victim of identity theft spends 7 mins to reestablish their identity and loses $0.00.

BTW, if you’ve heard something different on the news, in a trade magazine or from another credible source. Sorry, we started that.

In fact, here’s how we did it:

Step 1: We worked with our client to identify our target customer.

  1. Retired couples on fixed incomes
  2. Young teachers
  3. Business people who fly a lot

You might be saying, “that sounds like three totally different audiences.”

Not to us. To us, those are people who either lack knowledge and/or time, so they’re motivated to pay us money every month for something they don’t understand because they fear their own limitations. As bad as that sounds, it gets worse. They are also people who’ve joined a group that partnered with my customer. Organizations like AARP, the Teacher’s Association of America, or United Airlines. That’s right, partner can be a fancy way of saying someone who took money to put my message in front of their customers, so that I could leverage their existing credibility and establish trust.

Step 2: We pitched our client.

It went something like, “Our research shows that the best way to reach this audience is to encourage influencers to create native advertising opportunities that establish a consistent dialog and vocabulary with prospects. We will leverage this awareness to drive prospects into an omni-channel consideration campaign that will amplify partner messages. Only when prospects become qualified will we deliver branded campaigns that motivate action.”

Let’s try that in English now.

We are going to spend very little of your $1.5M ad budget, on ads. Instead, we’re going to pay respected journalists, radio personalities and influencers to create news stories that make people scared. In fact, we’re going to require these people to use very specific words to describe how data breaches make people lose all their money.

Then we’re going to establish places that our targets will find when they search for ways to avoid becoming a victim, using the words we gave them. These will be things like identity theft prevention comparison sites, partner help pages, even talk tracks for your helpful AARP service rep; really any trusted resource that will agree to say what we tell them and not mention your brand.

Once the prospect goes to any of these locations we will use email, social, search retargeting and direct mail campaigns to bombard them with our message from a variety of sources, so they feel like the entire world is talking about the importance of identity theft protection.

And finally, once they’re qualified, we’re going to show them an ad, because at that point we’ve already sold them and they need to know how to buy.

Can’t get worse, right?

Step 3: Throw a huge party because our budget was increased.

Yes, we threw a big party because our customer’s revenue grew 20% to exceed $150M that year. So, to summarize: we celebrated our ability to convince grandmas, young teachers and people who signed-up for an airline credit card (they often don’t realize they were automatically enrolled, or looked carefully at their credit card statements) that they should be afraid of being a victim of identify theft, even though we had $500k of research that proved we were lying. And after all that we took a bunch more money to help them gain even more market share, or in other words, put more of their competitors out of business.

Now, stop plotting against me for a second.

Here’s the good news, that company isn’t just lying to its customers, it’s also lying to its investors. Why? Because they know that their fear based marketing has a fatal flaw. It’s simple, once consumers become educated, they’ll stop buying. It’s not if, but when. Even though they do everything they can to stop people from being educated, smart competitors have been quietly educating and winning for years. That’s how you compete. Educate with integrity.

So, here’s what else you should take away from this.

  1. You are never going to find that one marketer, tool or tactic that will help you compete against the big guys. That’s because they have the resources to employ large groups of psychologists, sociologist, accountants, engineers and even a few creatives to create a powerful marketing ecosystem of partners, technology and strategies. No one person or thing can do that.
  2. Your competition is probably spending more than you realize on marketing. In fact, according to Libby Bierman, Analyst at Sageworks, the average small business in America spends 1% of their annual revenue on sales & marketing. Said differently, most businesses have a monthly marketing budget that is smaller than my last agencies monthly wine budget for brainstorming meetings. Contrast that against SalesForce, who spent 46% of their $10.48 billion gross revenue last year on sales and marketing.
  3. Marketing is not an ad, a logo, an email, or a website. It is a conversation that’s happening everywhere, all the time. You’d better be a part of it part of it, and you’d better have friends who are a part of it. If not, you’re not competing.

Damn, that’s a downer.

Well, here’s what should you do with that information.

First let’s look at a framework that you can use to research your audience, generate a strategy and compete.. Think about gardening. What are the steps?

Step 1: Seed

  • Ensure the right climate
  • Make room to grow
  • Plant in fertile soil

Step 2: Feed

  • Water
  • Sun
  • C02

Step 3: Protect

  • Repel insects and animals
  • Be prepared for inclement weather

Step 4: Spread

  • Attract bees to pollinate
  • Attract birds to spread seeds

As marketers, we use the same framework to grow a customer base. To demonstrate this, let me describe a great marketing example from Spotify. Here’s the back story: I was curious about Spotify, so I visited their site but didn’t buy. The next day they began marketing to me.

  • Step 1: Discover (Seed)
  • Just like my client, Spotify had done research to understand what would motivate a potential buyer to consider switching providers, what barriers they would have to overcome and where buyers would go to consider potential solutions. In my case:
  • I was motivated by the idea that I could listen to a full album, which I couldn’t do using Pandora
  • My barrier was that I hate giving my credit card to a company before I try the product
  • I searched comparison sites to research my options

Here is how Spotify helped me move from the Discovery phase to Consideration phase:

  • They placed ads in my Facebook feed that said something like, “Wouldn’t it be great to listen to an entire album? Try Spotify for 30 days. You don’t even need a credit card.” This led to what we call an “Aha Moment.” This is the moment that I discovered I had an unmet need, I couldn’t listen to a full album with my current provider.
  • They then removed a big barrier for me, I didn’t have to provide a credit card number.
  • Finally, they not only made sure they had plenty of good reviews, but they retargeted me with ads while I researched, so they could begin to feed me additional benefits. This created fertile soil and resulted in me signing up for a 30 day trial.

Step 2: Consider (Feed)

  • Once I signed up they began to feed me more things to consider. This was done through in app ads, social retargeting and email. All of these communications were meant to remove doubt and drive me to pay for the service. They continued to send me content until I began to behave in a way that demonstrated a willingness to buy. I have no idea what the trigger was, but I assume it was something like the number of content pieces I clicked on, or number of hours I had spent listening to Spotify. Regardless, my behavior triggered the next offer. “Add your credit card number and get 60 more days for free.” Which I did.

Step 3: Decide (Protect)

  • At that moment I had made a decision to buy, but Spotify didn’t stop marketing. Instead, they supported my purchase and protected their marketing investment with quick, how-to content and stories that helped me see the true value of the service they offered. Once I was equipped with this understanding they moved me to the next phase.

Step 4: Advocate (Spread)

  • The content Spotify shared during the Decide phase made me feel like I had made an informed decision, so I perceived value, which made me a happy customer. In fact, I was happy enough to lend them my credibility and amplify their messages, and they encouraged me to do so. They did this by offering a couple more free months if I shared my experience with my friends. Which I did.
  • To give you a couple more ideas, we did the same thing for my client, with two follow on campaigns. I know they are gross, but the strategies are good.
  • A winback campaign. We had our new, happy customers tell their stories to people who had canceled their subscriptions. Essentially saying, “We don’t know what happened, but there are lots of happy people using our service and we’d love it if you were happy too.”
  • A referral campaign. Essentially, “You are safe Grandma, don’t you want your grandkids to be safe too. Here’s a way to recommend us, or even a way to buy it for them (makes a great stocking stuffer).

So, how can you get started? Well, it all starts by finding fertile soil, so you can create “Aha Moments” for people. To do that you have to understand your prospects, which means you have to do customer research. Since you probably don’t have $500k to spend, like the company I worked with, you’ll have to do it yourself. Honestly, this can be difficult, time consuming and demoralizing. However, it’s worth the effort because without an understanding of your potential buyer it is very hard to get them to consider your product, make a decision and eventually advocate for your brand.

Here’s an example of what I’ve done over the past 12 months, after joining the FracTEL team. Since joining FracTEL, I’ve iteratively participated in collecting the following types of customer research.

  • Desk Research: We spent hundreds of hours reading every competitor site, comparison site, analyst report and subject matter expert post we could find.
  • Quantitative Research: We looked for data that could support the need for our product. I like to start by searching for infographics. Often companies, with similar offerings, have spent a lot of time and money to curate data for me, which is super nice because I, like you, don’t have time or money to waste.
  • Qualitative Research: We went to tradeshows, met with our customers and connected with anyone we thought would be interested in, or expressed doubt about our concept. Fair warning, I’ve spent a lot of time recently listening to feedback. Those conversations were often hard to hear, since I know my team poured their hearts and souls into our MVP product. However, more often than not, those were the conversations that generated the insights we needed to identify our audience and better understand their motivations. So, I recommend just grinning and bearing it.

Just to prove how important this work was, here are some of the things that our research helped to inform and create.

  1. We determine that our traditional market had become oversaturated. This reality continues to increase the cost to acquire a new customer, while devaluing those customers in the case of an acquisition.
  2. The research also identified an emerging opportunity in the wholesale services market. This insight helped us focus sales and ensure our traditional 30% annual growth for 2019 by January.
  3. We were also able to prioritize market tests for three new products, which lead to us deprioritizing two, so we could focus on the one our data showed had the most potential. Once we did that, we were able to create a product roadmap to inform development, marketing, sales and support activities. With that roadmap I began to create marketing materials to test. The feedback from those tests allowed us to update our messaging and over the past few weeks we have started to see a lot more “Aha Moments.”
  4. Those “Aha Moments” led to insights that helped us generate a strategy that we can support with our current resources and has proven to create a sense of urgency in buyers.
  5. In parallel our development team used the research to quickly make meaningful changes to the platform, those changes allowed us to win partners and create case studies, which we can now use to amplify our message.

Here is what I hope you take from this.

  • Marketing requires more than a creative ad, or fancy tools. It is the science of building meaningful relationships with consumers.
  • As with any science, it’s a little bit of an art, combined with a lot of data. In order to get good data, you’ll have to do good research. Trust me, it will feel like it takes forever, you’ll want to quit on and you’ll fail more than once even after you do it. However, without good data companies chase relationships with people who can’t benefit from their products, they make uninformed decisions about product development and those mistakes ultimately cost a lot more than research. So, don’t quit.
  • Once you have the data to determine who will benefit from your product and what their motivations are you can start planning your strategy. Use the framework above to create a conversation that helps buyers have an “Aha Moment,” consider their options, make an educated decision and advocate for your brand.
  • Conversations are how you educate customers in order to beat the big guys. Even if they do terrible things, especially if they do terrible things, a well thought out marketing strategy based on a clear understanding of your customers needs will help you win.

Finally, here are some tools and examples that can help you better understand your buyers and create strategies that develop meaningful relationships with them.

  1. Empathy Map Canvas — Recognized by Stanford University and IDEO, as a scrappy way to develop deep, shared understanding and empathy for other people. Great for qualitative research. Also, it’s part of a book called Gamestorming that is filled with good things to do.
  2. Buyer Personas — A one page representation of your buyer. This is then used to make decisions. You know you’ve done it right when the team asks, “What would Amy do?” and you realize that Amy is the person you made up to represent a specific buyer.
  3. Customer Journey Map — Remember when I said the framework gets more complicated. It also gets way cooler. Here’s how Adaptive Path was able to create a customer journey that changed the way Europe’s rail systems markets itself. Example and case study.

Good luck and do good marketing, or the next article might be about you.

nBaz9BPTkyWQAlvXqQnz_full_Adam Hoffman
ABOUT THE WRITER

Adam Hoffmann

An experienced marketing professional with two decades of strategic experience serving Fortune 500 companies and emerging startups.

Open House Recap: How to be Found When Applying for Jobs

June 7th, we held the first ever Groundswell Open House — a conference-style, all-day event featuring talks from HR professionals, sales and marketing mentors and recruiters on topics for startups and job-seekers alike. Didn’t make it? No problem — we’re sharing our notes on the talks that we went to. Today, we’re talking How to…
Read More

GS Open House Recap: How to Inspire People in the Workplace

The average cost to hire a new employee is $10,000.00 per person and the average turnover rate for a company is 13% per year. Imagine reducing that cost and utilizing it for further R&D or marketing. If you can minimize the turnover rate, you can save thousands by emphasizing on your initial hire. When you…
Read More

Open House Recap: Creating the Perfect Elevator Pitch

On June 7th, we held the first ever Groundswell Open House — a conference-style, all-day event featuring talks from HR professionals, sales and marketing mentors and recruiters on topics for startups and job-seekers alike. Didn’t make it? No problem — all of this week, we’ll be sharing our notes on the talks that we went to. Today we’ll be…
Read More

Leave a Comment