• by John Nardone , Op-Ed Contributor, September 5, 2008

Few marketers have taken full advantage of the opportunity for one-to-one marketing online. Sure, many companies have online CRM programs to address registered users, and even more have well-developed email programs. But when it comes to acquiring new customers or getting consumers into these CRM programs, most marketers and agencies still default to a traditional approach.

They use mass media (often including TV), search and online display ads to build awareness, and lay down generalized brand points in the hopes of engaging consumers and getting them into the top of the purchase funnel. As a result, upper-funnel efforts tend to be hit and miss, when a more one-to-one approach might deliver better engagement and accelerated path to conversion or sale.

Unfortunately, the majority of marketers (and agencies!) has not developed the strategies, capabilities or discipline needed for one-to-one engagement of prospects. These five steps require commitment to implement, but have helped several major marketers improve the productivity of acquisition programs.

1. Expand your concept of audience segmentation. In addition to demographics, psychographics and needs, include web enablement and web behavior dimensions. Such a multi-dimensional approach to segmentation is not always intuitive. It may require advanced modeling approaches to understand different clusters of characteristics that relate to behavior. Regression, discriminate analysis, and clustering algorithms can all be useful approaches to tease apart distinct and targetable audiences. But be careful: not all audiences have the same economic potential. Be sure to discriminate based on potential value and provide planners with appropriate cost per acquisition allowables for each group. American Express includes web behavior and customer value dimensions in its online segmentation models in order to squeeze the most value from its online card acquisitions.

2. Understand (and document) your purchase funnel. Sounds obvious, right? But does every member of your team really understand how consumers get into and move through the process? Is the process the same for all consumers, or is the funnel different for different segments? Can the process be accelerated? Or is it mediated by triggers or life stage events? And at each point, how are consumers in each segment using the Internet? Marketers must not be satisfied with flimsy research or limited insight. They should be able to answer these questions with a detailed model of consumer demand that is communicated to staff and agency. IBM designs separate web site landing pages for different points in the conversion funnel, then links to the appropriate page depending on the goal of the creative. Even search terms are categorized by stage of funnel and linked accordingly.

3. Invest in a dynamic publishing platform for your web sites and the content and data to drive it. Dynamic web site publishing platforms like Interwoven or Vignette can be powerful tools if you have the right content and data to drive them. Make sure to create content to address each intersection of purchase funnel and audience segment. Then, maintain interaction data as an asset to power real-time targeting of content and offers on the web site. Don't rely on setting marketer-determined rules to govern content delivery. Rather, use the data to build statistical models to recognize, target and place in purchase cycles in real time. Marketing judgment is almost always outperformed by a data-driven targeting model. For example, Delta Airlines has thousands of possible routes and offers to serve to consumers on its web site. It improved on marketers' judgment by creating a library of images, headlines and copy that is dynamically assembled to present offers based on user characteristics as well as keywords searched. Conversion rates off the web site showed immediate and dramatic improvement.

4. Integrate siloed marketing efforts. Envision one integrated web presence, onsite and offsite (web site, search and display), then plan media and creative together. With a detailed understanding of audience segments and conversion funnel, media planners and creatives have an opportunity to work more closely as a team. Creatives will appreciate the opportunity to create laser-sharp messages against well-defined consumer profiles and needs. Media planners will enjoy contributing to the creative process by highlighting contextual opportunities and developing custom placements. Working together, campaigns can be designed with sequential messaging that takes advantage of new media technologies that seamlessly pass data from one interaction to the next. You'll get better work and a more engaged team overall.

5. Optimize against success metrics for each target audience at each phase of the funnel. Overall campaign metrics are not enough. Track audience composition and reach as the key metric at funnel entry. Look at engagement metrics for the consideration phase. Evaluate the profiles of engaged consumers against past purchasers. Is the campaign engaging each of the target audiences as expected? But most importantly, have a plan to track and optimize against the different value of each segment and funnel stage so that campaigns can be optimized against delivered value, not just total number of conversions. You don't want to waste opportunities converting low-value offers or low-value customers.

Using this approach, marketers will quickly find their performance numbers going up, and their cost per acquisition numbers going down. More consumers will be dropped into the top of the purchase funnel, and more of them will be pulled through to sale.