Behavioral Marketing Delivers

According to new research by Silverpop, with Forrester Consulting, today’s buyers control the buying process far more than today’s vendors control the selling process, a phenomenon that affects both business-to-business and business-to-consumer marketers. Buyers seek the information they want online, on the Web and in social channels, as well as in the “real world.” Today’s buyers, though, expect sellers to know where they’ve been, what they’ve seen, what they’ve accepted or rejected, whether that behavior happened on their tablet, via their smartphone, or at the local branch office. Today’s marketers are struggling to keep up.

Through in-depth surveys with 157 marketing professionals in the US, the study found that most marketers are simply using marketing automation to scale and standardize marketing processes. However, a small vanguard is using automation to focus on customer behavior across multiple engagement channels. The study finds that marketers who have adopted behavioral marketing practices have realized business benefits ranging from higher return on marketing investment (ROMI) to higher contributions to sales pipelines and revenue.

The study yielded four key findings:

  • Marketing automation is broadly deployed to manage core marketing processes from campaign development to lead management. But top performers seem to be leveraging their tech investments differently, executing a higher number of more focused campaigns and setting higher targets.
  • Both B2B and B2C marketers have accepted multichannel marketing as common practice. Marketers are familiar with the concepts and practices of multichannel marketing. One-quarter of the survey respondents assessed themselves as mature practitioners of multichannel marketing. Another 39% were in transition. Only 7% of respondents had no plans to implement multichannel marketing.
  • Behavioral marketing is a slightly less mature practice. Only 17% of the survey respondents assessed themselves as mature practitioners of behavioral marketing. But early adopters perceive significant benefits to becoming more buyer-centric. Significantly, a higher percentage of behavioral marketers grew revenue faster than plan (53% versus 41%) and contributed more than half of the sales pipeline (20% versus 11%).
  • Practitioners of behavioral marketing have significantly different practices. Those marketers who self-assessed as “mature” reported significant differences in their approach to marketing: They have more fully implemented marketing automation, run more campaigns, and run a greater variety of campaigns.

Companies have always, to a greater or lesser extent, called themselves “customer-centric.” But the age of the customer requires that the marketer go beyond customer-centric thinking  to customer-centric operations . In the age of the customer, three elements are essential to success, says the report:

  • A customer-obsessed approach to defining the business and marketing strategy;
  • An in-depth understanding of customers’ behaviors and needs;
  • A customer engagement strategy that is calibrated to those behaviors and needs.

For many product categories, buyers now put off talking with salespeople until they are ready for price quotes or delivery terms. Buyers are finding the information they need in an ever-expanding array of content types, from infographics to video to white papers, in an ever-increasing number and variety of online and offline channels, and accessing the online channels from an increasingly diverse array of devices.

This changing buyer dynamic changes the role of marketing in several fundamental ways:

  • Marketing owns a bigger chunk of the “selling process.” Guiding the buyer through the early stages of the buying process (traditionally the role of sales) requires an outside-in approach, calibrated to the buyer’s wants and needs, shifting the focus from content that details features and benefits to engagement that informs, persuades, and convinces.
  • Marketers must engage consistently over multiple channels.  According to the study, B2C marketers are much more prepared than B2B marketers to engage multi touch-point customers with a multichannel approach. 69% of the B2C marketers reported that they were either mature multichannel practitioners or were transitioning to that state. Among B2B marketers, only 59% indicated a similar level of maturity.

Marketing Organization Stance Toward Behavioral and MultiChannel Marketing

 

% of Respondents

Attitude

Behavioral  Marketing

Multichannel Marketing 

Mature

17%

25%

Transitioning

34

39

Beginning transition end of 2013

18

10

Interested, but no pland

20

18

No plans, and not interested

10

7

Source: Silverpop/ForresterConsulting, May 2013

Buyers seek answers to different questions that stand between them and a decision. The speed of purchase decisions is predicated on the delivery of relevant marketing activities, messages, and content at each stage of the buyer’s journey. But only 17% of survey respondents, in assessing their maturity with behavioral marketing, rated themselves as mature practitioners. B2C marketers were slightly ahead of the game, as 20% rated themselves as mature practitioners and another 41% as in transition, compared with 16% and 25%, respectively, for B2B marketers. 

Marketing Organizations “Implementing, Not Expanding” or “Expanding/upgrading Implementation; % of Respondents

Technology/Service

B2B

B2C

Web analytics tool

73%

83%

Email service provider

73

75

Web content management system

71

76

Social media engagement and monitoring

57

83

Campaign management application

55

68

Lead management system

52

46

Source: Silverpop/ForresterConsulting, May 2013

Small and medium-size businesses (SMBs) have dramatically adapted their marketing practices to changing buyer behaviors, where the journey for nearly every purchase (business or consumer) begins with a web search. The new generation of top-performing SMB competitors has embraced online marketing, as demonstrated by their marketing investment levels.

Marketing Organization Status re Software Technologies or Services (% of respondents; “implemented, not expanding” or “expanding/upgrading implementation”)

Technology

Small Business (<500 Employees)

All Respondents

Web analytics tool

73%

77%

Email service provider

78

75

Web content management system

66

75

Social media engagement and monitoring

66

73

Campaign management application

59

61

Lead management system

42

48

Source: Silverpop/ForresterConsulting, May 2013

B2C marketers have an automation advantage over B2B companies. B2C marketers reported a higher level of automation in all but one marketing automation category (see Figure 5). More than half of the B2C marketers claimed to be “somewhat aggressive or at the forefront” of technology adoption. B2C marketers also have a better relationship with their IT support: 56% reported having an “excellent or good” relationship with IT, versus only 46% of B2B marketers.

B2C marketers are decidedly more social. In particular, B2C marketers are using social media management technology far more than their B2B counterparts (83% versus 57%). B2B marketers consistently underestimate just how “social” business buyers are. Forrester’s research finds that 86% of business buyers engage in social activity for their work; 55% cite online communities and forums as influencers on their decisions.4

B2B marketers are more likely to nurture customer relationships. The one category where B2B marketers are more heavily invested than B2C marketers is in the category of lead management systems. Many B2C marketers don’t take advantage of technology to engage with customers systematically throughout a longer buying cycle — or throughout the entire customer life cycle. In fact, digging into the campaign strategies of our respondents, we learned that 44% of B2C marketers had no plans or intention to implement lead nurturing campaigns, while 71% of B2B marketers are either executing lead nurturing campaigns today or plan to start doing so within the next 12 months. 

According to the report, behavioral marketers are getting better results. Survey results show that even the most advanced behavioral marketers still rank as neophytes — but the early results are promising, as the behavioral marketing vanguard is performing better than its peers, says the report.

Perceived Advantages From Behavioral Marketing (Improvement When Able To Take Actions Based On Behavioral Marketing)

 

Action

% of Improvement

1-10%

11-20%

≥21%

Revenue attributed to marketing

44%

28%

10%

Customer satisfaction/loyalty measures

41

32

8

Capture new type of customer (e.g. Millenials)

37

22

8

Return on investment

44

33

7

Campaign payback

42

22

6

Reduction in campaign expenditures

41

26

5

Reduction in avg. sales cycle

39

17

4

Reduction in per-customer acquisition costs

42

22

4

Source: Silverpop/ForresterConsulting, May 2013

For the complete report in PDF format, please visit here.

 

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3 comments about "Behavioral Marketing Delivers".
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  1. Herb Lair from CUO,Inc., July 2, 2013 at 5:01 p.m.

    Behavioral Based Social Media System for the Cable TV Market
    by Herb Lair

    Cable has long history of failing to develop 1-1 target marketing.

    Excerpt January, 2011 Fortune.com –

    “Advertisers will spend $56 billion putting ads on TV this year,...The cable industry thought it would be a big opportunity too, but its efforts have fallen short. Canoe Ventures, a two-year-old project of the six biggest operators, has launched just one notable product…”

    Excerpt from February, 2011 Business Insider

    Identifies advertising market being missed by Cable TV operators

    “Advertisers have weighed in heavily on the future of TV, with both their thoughts and their considerable wallets. Advertisers are increasingly expecting to present their advertising messages to just their desired audience…and not to anyone else. For over 60 years, video advertising could only be bought via a TV show’s projected audience, which served as a blunt proxy for a certain target audience.”

    The obvious alternative, with the least cost to implement is an independent Cloud CRM solution designed to cross index cable subscriber households with their corresponding social network interests. The current regulatory and privacy issues experienced by cable TV operators gathering unauthorized data from set-top boxes could be minimized, by validating subscriber and even eliminated by essentially having an opt-in plan (provided conveniently by the social media). Access along with profile and interests of households would be controlled by the subscriber’s social media platform of choice. Facebook has high consumer acceptance and could be used for household profiles, product interests, social interests, and viewing entertainment interests. There would be incentives to the subscribers to opt-in including notification and reminder of viewing favorites, Groupon type ads, and specific ads matching interests with infomercial type group discounts and urgency to buy.

    The current design of target marketing advertising ventures is fundamentally flawed. They focus on demographics, and fail to identify the individual behavioral current and future household interests.

    I would propose using a data cross indexing.

    Project would involve developing a bidirectional Cloud interface program using a CRM application between the social media and MSO subscriber records and communicating behavioral marketing - business advertising, discounts, specific videos/groups, family albums – providing subscriber awareness of TV programming -- movies, products, etc. similar to Amazon and Groupon. This would make subscriber stickier and substantially reduce turnover.

    To paraphrase a comment I made in the CED 1999 publication about the Internet, cable TV operators need to become the new best friends with the 1 billion members of social media.

  2. Paula Lynn from Who Else Unlimited, July 2, 2013 at 6:36 p.m.

    More dangerous than the NSA.

  3. Aabha Sidharth from Self-employed, December 30, 2013 at 7:16 a.m.

    Behavioral marketing can be quite the double-edged sword. However, marketers can definitely find ways to benefit from it. As long as the data is reliable and used judiciously, there's very little reason why it shouldn't work.
    I was reading another post on what behavioral marketing can do for businesses http://bit.ly/JoZ0S4