By Curtis Schroeder, MBA Candidate
Imagine the 60-foot-long boat of the U.S. women's national rowing team cutting across a crystal-clear lake in a heated 2,000-meter race. As the team synchronously rows their oars back and forth, they look forward and eagerly await direction from the coxswain, the competitor/coach seated in the stern of the boat in front of them. The coxswain calls out commands to influence the behavior of her team: Let it glide! Hold starboard! Power 10! Competing with the coxswain's messages are the noises the boats and oars make in the water, the voices of the other competitors, and the roars of the crowd cheering their teams on to victory.
For the coxswain to be most effective in her role, she knows that her team must establish a strong game plan before the race begins. To win, she must understand the makeup of her team, establish clear and concise signals that her team can recognize and respond to during the race, and communicate those signals quickly and at exactly the right times. Otherwise, the coxswain's messages will be lost in the competing noise of the race and her team will fail to reach their potential.
Sandra Zoratti and Lee Gallagher's principles of precision marketing in their new book, Precision Marketing: Maximizing Revenue Through Relevance, parallel the roles of the coxswain. To win the race - or to generate the highest potential Return on Investment (ROI) in today's marketplace - Zoratti and Gallagher argue that marketers must become increasingly relevant. Specifically, they must leverage what they know (or what they can find out) about their customers, what messages they are trying to communicate, and when/how the messages will have the greatest impact. Through a clear and deliberate game plan, informed marketing efforts can most effectively accomplish the specific goals marketers seek to achieve.
Like any marketer, real estate agents can also learn to harness the power of relevancy to make marketing efforts count. By exercising the six steps in Zoratti and Gallagher's Precision Marketing framework, agents can refocus marketing efforts to access the right markets with the right messages at the right times through the right channels - which will help drive awareness, sales and ultimately lead to increased income.
THINK POINT #1: Relevant Marketing Cuts Through the Noise
Before implementing the Precision Marketing Framework, marketers must understand what they are up against.
Like the coxswain, as marketers in all industries plan and implement marketing campaigns, they must deal with "noise," or the overabundance of marketing messages that compete for consumers' attention. Decision makers often cast the net wide, sending email blasts and purchasing radio time in an effort to reach whomever might be listening. As Zoratti and Gallagher describe, many marketers employ the 1 percent solution, meaning that efforts are deemed successful if they are relevant for at least 1 percent of the audience they reach. What these marketers may not think about, though, is that they are unashamedly crowding marketing airwaves with messages that are irrelevant to 99 percent of the audience. Not only do extraneous messages create unnecessary noise, they actually have the potential to hurt a company's brand.
Studies on advertising messages over the last 30+ years also reveal an alarming insight into the battle for consumers' attention. In 1978, a researcher found that consumers were confronted with more than 2,000 advertising messages each day. The same researcher found that in 2007, this number had grown to more than 5,000 ad messages a day. A 2010 study suggests that the figure has increased by over 300%, and that consumers are now confronted with over 16,000 advertisements each day.
In addition to the competing noise that increased marketing creates for all goods and services in the marketplace, this escalation in marketing activity suggests that marketers have truly lost touch with the consumer. The accessibility afforded by many of today's mass marketing tools (e.g., the Internet, Twitter/social media, digital/direct mailing mechanisms, etc.) enables marketers to push messages to a large audience for a minimal cost. For agents to achieve relevance in their markets, though, their messages must cut through the noise. Relevancy is one of the main ways that messages gain traction in high-traffic marketing environments. Zoratti and Gallagher argue that the key to being relevant is establishing a deliberate and precise marketing game plan.
How deliberate and precise are your current marketing efforts? How have your messages created "noise" in the marketing airwaves? How might an informed marketing scheme impact your brand and effectiveness in the area you work?
THINK POINT #2: The Precision Marketing Framework - Six Steps To Relevance
Zoratti and Gallagher's book outlines the six steps to relevant marketing. These steps make up the Precision Marketing framework:
- Step One: Determine Your Objective
Establishing the specific objective(s) for any marketing effort creates parameters and clarity for the rest of the process. Four popular objectives that Zoratti and Gallagher describe include customer retention (keeping current customers), customer growth (growing current customers), customer reactivation (re-engaging dormant customers) and customer acquisition (acquiring new customers). Objectives should be specific, time-based, measurable, relevant and achievable.
Whether an agent is looking to increase his brand awareness in a specific community or reaching out to prospective sellers, defining the objectives of his campaign at the outset is the most critical component of a successful Precision Marketing framework.
- Step Two: Gather Data
Data are the lifeblood of marketing efforts - data lead to insights, insights help establish relevance, and relevance leads to customer loyalty. Data can be difficult to attain, though, for a number of reasons. The information that is most necessary may be inaccessible, incomprehensible, inaccurate, or unavailable. To gather relevant information, real estate marketers have many options.
Personal/company data sources are typically the best place for agents to begin. If historical customer information is tracked (transactions, communications, outcomes, etc.), this data may provide keen insights on current customers. If this information is not as robust as you would like or if you are looking to understand a broader pool of consumers, a number of third-party options are available. The U.S. Department of Housing and Urban Development (HUD), the U.S. Census Bureau, and local housing authorities are all strong options for uncovering information about the communities you work in.
Focusing on the necessity of data in all business efforts can lead to important long-term outcomes. As you collect data in the future, ask questions like how can this data improve our knowledge of our existing and/or prospective customers? How can this data enable us to be more relevant to our customers? Understanding your customers is an important component to being relevant to your customers.
- Step Three: Analyze and Model
With the right data, agents can uncover actionable customer insights through analysis and modeling. Understanding the demographic makeup of a given community (gender, age, income, etc.), for example, can help focus marketing efforts to reach a very specific customer group. Suppose you want to share a message about purchasing a first home with young adults in your community. Accessing data on adults between the ages of 20-35 with a household income of >$80,000 might help you target the group that would have the greatest potential return on your campaign. Data segmented by historical responses and outcomes can also help to predict and influence future success rates of marketing campaigns.
Data analysis and modeling moves marketers closer to the fundamental tenets of Precision Marketing - getting the right message to the right person at the right time through the right channel. By understanding your customers more thoroughly and focusing messages more precisely, marketing efforts can reach the 1 percent of consumers most likely to respond to your message while avoiding the cost, time and inconvenience of sending it to the other 99 percent.
- Step Four: Strategize
Conventional marketing knowledge suggests that an effective marketing strategy includes a combination of strategic objectives, including segmenting the audience, positioning the product, selecting a channel, and developing content/creative, among others. While these components have been ideals for marketers to strive for, they are not able to truly target a specific audience on their own.
Zoratti and Gallagher affirm that these objectives are still relevant, however they suggest that the real value in today's strategic planning processes is marketers' access to and use of data. Incorporating data into the strategic planning stage breathes new life into these "traditional" objectives and represent the new contribution that Precision Marketing can make to the strategic planning phase of a marketing campaign.
Understanding more about a particular neighborhood or which channels are most effective for specific types of communications, for example, can move real estate professionals from practicing marketing 1.0 into the more relevant practice of Precision Marketing. Even with traditional, cold, unqualified lists, agents can use data to draw new insights about customers that can strategically reshape their marketing efforts.
Remember that the right messages engage customers and lead to behaviors that benefit both the customer and the company. An effective, data-driven strategy brings all previous steps of the Precision Marketing framework together to create the most effective campaign.
- Step Five: Deploy
After the objectives have been determined, data has been collected, analysis/modeling completed and the strategy is set, the marketing campaign is ready to be executed. Depending on the size and scope of the campaign, testing may be appropriate to gain a preliminary understanding of how it will perform when executed at full-scale. The main objective of the Deploy stage, though, is to focus on managing and analyzing the execution of the campaign to maximize effectiveness and to optimize ROI.
- Step Six: Measure
The goal of the Measurement step is to move from the "Deploy" stage back to the "Objective" stage through objective, factual measurement. Measurements help marketers learn about the effectiveness of their campaigns and what might need to be adjusted in future efforts. Zoratti and Gallagher affirm that the effectiveness of any marketing campaign is typically defined by bottom line, revenue and ROI - no matter how creative the campaign might be.
Consider how measurements can help a real estate agent understand the effectiveness of her marketing efforts. By simply tracking how/where clients heard about her services, for example, she can begin to measure the effectiveness of her marketing efforts as a lead generation tool. Using Quick Response (QR) codes on brochures and signage can also serve as a measurement technique. The codes drive customers to a website via a QR-enabled mobile phone application, and many free QR code-creating services (like Delivr) can provide marketers with information on how many people accessed the site, when they accessed the site, where they were located, etc. Strong measurement mechanisms can lead to a larger and more qualified client database, which can have a strong impact on her annual home sales, referrals and other measurable outcomes.
Achieving relevancy requires more than just a shotgun approach to marketing. Blasting a message to an audience of anyone that will listen is not an effective way to accomplish your marketing goals and can actually hurt your brand image in the long-run. Like the coxswain in the boat race, finding the most effective way to deliver your message through the competing noise gives you the best chance to communicate your message to the right audience.
The ongoing and cyclical Precision Marketing process will help make you even more relevant, which can lead to more effective marketing outcomes and long-term success.
. . . . . . . . . . . . . . . . . . .
Zoratti, Sandra and Lee Gallagher (2012), Precision Marketing: Maximizing Revenue Through Relevance, Philadelphia: Kogan Page Limited.
. . . . . . . . . . . . . . . . . . .
About the Author
Curtis Schroeder, MBA Candidate
Associate Editor, Keller Center Research Report
Assistant Director, Keller Center for Research and Center for Professional Selling
Curtis Schroeder graduated from Baylor University with a Bachelor of Business Administration in Marketing in 2009. Curtis currently serves as the Associate Editor of the Keller Center Research Report and as the Assistant Director of the Keller Center for Research and the Center for Professional Selling at Baylor University. Curtis is pursuing a Masters of Business Administration from Baylor University with a focus in marketing.
More News ...