How to Calculate ROI for Marketing

Posted September 27, 2010 by Matt Warta | Permalink

When I first entered the field of marketing 20 years ago, one of the old adages I often heard was that 50% of an advertising budget is effective, and it is impossible to understand which 50%.

My colleague, Marshall England, and I went to Brand ManageCamp last week to listen to some marketing luminaries, and frankly, to solicit some customers.  One of the things I learned is that this adage is still true in many cases today…with many forms of digital marketing obviously being the exception.

There were two speeches which really went after the heart of this issue.  The first was presented by Don Schultz.  Don focused on the critical thinking and analytic tools required to get one’s head around the issue.  This was geeky stuff which I loved like using IRR, Customer Lifetime Value, Chiad Trees to frame decisions on how to best acquire customers.  The other speaker who addressed this was David Meerman Scott who argues in his new book Real-Time Marketing and PR that marketers need to be equipped with the same kinds of systems that he encountered in his first job sitting on the bond desk of an investment bank.  Only by have having real-time systems to research opportunities and perform the analytics can the marketer have the ability to decipher which dollars are being spent wisely.

Many of these tools exist today.  Tools like Salesforce.com, Hubspot, ZenDesk are giving marketers a full view of the customer.  We, at GutCheck, are doing our part by providing marketers with real-time access to their target market to ensure that campaigns conceived on Madison Avenue will have the desired effect.  I suspect there are many other tools out there today or which are being conceived which will make David’s vision a reality in the near term.

What tools are you using to get your head around this issue?

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What Customers Are Saying

Posted September 19, 2010 by Matt Warta | Permalink

With the full launch of GutCheck being a not-so-distant reality, the team has been getting out in front of customers more and more.  While there are a wide variety of potential users for our product, we have focused much of our initial efforts on marketers and agencies which are B2C oriented.

This past week I had several meetings with some well-known agencies in NYC.  I did live demos for all of them, so they could see the product in action for the first time.  When asked what they would use GutCheck for, the usage scenarios were pretty common across the board.

Pitching new business.  Agencies have to have customer insight to win new business.  To gain this perspective, many agencies will use Survey Monkey to poll co-workers, and friends and family if they fit the demographic profile of the potential client.  All of them realize the issues with this.  They don’t always have the appropriate demos, and they often wind up with a very coastal perspective (NYC or LA).  However, they need timely information, and traditional research methods aren’t able to deliver on this front.

Validating Concepts and Creative.  The other use case which seemed to come up often was using GutCheck to quickly see if they are going down the right track with a concept or with creative.  They would likely use this before fielding a larger and more expensive quantitative study.  Today, many of these firms use traditional focus groups to suss out this kind of information.  However, they’d love to be able to get this kind of information in quicker time frames (day(s) v. weeks) and at a much-reduced rate ($40 per respondent v. $400+ per respondent) which is what we are offering.

As we continue with our beta, I am sure we will find other, interesting uses for GutCheck.

What would you use it for?

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Brand Manage Camp 2010

Posted September 17, 2010 by Matt Warta | Permalink

Matt and I will be at Brand Manage Camp in Las Vegas next week (9/21-9/22). We’re looking forward to some Fresh Thinking, which the conference boasts. I think the branding world has had a rough couple of years, so I will be interested to hear the discussions and presentations that make up the agenda.

In particular, I’m looking forward to hearing David Meerman Scott, Jeffrey Hayzlett and Jackie Huba speak. I’ve followed their work and I’m looking forward to the opportunity to hear their thoughts and maybe meet them.

If anyone else also attending the show would like to learn more about the stage that GutCheck is at, feel free to drop us a comment or contact us. We’re happy to meet with you.

And remember….what happens in Vegas, stays in Facebook. (I forget where I heard that, but true.)

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A Good Idea

Posted September 14, 2010 by Matt Warta | Permalink

Everyday, thousands, of brilliant ideas are generated by people. Those ideas bubble up and are discussed, formally and informally, to family, friends, colleagues and bosses. Ideas are vetted within that circle of exposure for feedback and some number of the ideas graduate to something else- a concept, a design, a product, a solution, a service or a business. I’ve had a few, perhaps you have too. A general consensus of ‘that’s a good idea’ is usually enough to motivate some people on making their idea a reality- for other’s, just knowing they have a gold mine of an idea to pull out of their back pocket at a later date is enough.

For the good ideas generated in a business setting, where the business may stand to benefit from the success of the idea, the business needs to decide on how well the idea “fits” with the existing business needs, feasibility to execute, evaluate customer acceptance, etc. Literally, the business needs to know, Is this a good idea?

In a recent post, from The Corner Office series on Bnet.com by Steve Tobak, ‘How Brilliant Ideas Destroy Companies‘, Steve explains that there are a lot of brilliant ideas that get consideration at companies and while brilliant ideas are fine and dandy, they need to be vetted through a decision process to determine if the idea will be good for the business and won’t take away from the core business focus (like some of his examples on his post). Steve stated:

“…it really comes down to discipline: staying focused on what you’re good at and ensuring that there’s a relatively consistent and disciplined strategic process for determining what not to do. And above all, remember this: Just because …
- it’s the CEO’s pet project,
- a customer wants it,
- xyz competitor is doing it,
- the founder loves it,
- the government is funding it, or
- it’s a brilliant idea,
doesn’t mean there’s sufficient reason to do it. Period.”

What process do you put your idea through to gain sufficient reason or supporting context to pursue it? As a business or entrepreneur do you talk to your existing customers, talk to intended customers, perform a SWOT analysis, do a study, buy analyst analysis…let me know in the comments below, I’d like to find out.

The point is, in today’s technologically advanced world it is easy and affordable to get some quick, target customer feedback to support or oppose how good your idea is, or rather, how well it will be received. That feedback will help you build a stronger case for your idea as it make it’s way through a decision process. Whether it’s a brilliant idea to combine a road trip staple with caffeine into one snack or enter a new geographic region with a mismatched product and brand name- gaining direct feedback from target customers will, at the very least, help to validate the pursuit of your idea, and at the most have helped you plan on how to make your idea a bigger success.

Isn’t that a good idea?

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When I hear the name Turkey Hill, I think Iced Tea?

Posted September 9, 2010 by Matt Warta | Permalink

Awhile back, I noticed an ad on TV in Denver for a new bottled Ice Tea…Turkey Hill Ice Tea. I am no naming expert (far from it), but it left me wondering why would someone choose “Turkey Hill” as the product name.

There are a lot of good, tea product names out there which fit their product. Honest Tea promises to create and promote delicious, truly healthy, organic beverages. Republic of Tea’s goal is to spark a Tea Revolution by canvassing the most prized tea gardens of the world for their worthiest leaves and providing them to their customers.

Now, I am not a big tea drinker. As any of my friends will tell you, I prefer a triple capaccino from a non-Starbuck’s independent coffee house. However, I am left scratching my head about why this name was used. If you check out Turkey Hill, it is clear they’ve been around for awhile, so they obviously have some smart folks over there. Their brand equity seems to be solid out in Pennsylvania and Mid Atlantic area, so I suspect they are trying to enter into new markets out west…Denver is where I call home.

Rather than rely on my gut, I quickly GutChecked it with who I assume is their target audience for their ads out this way – woman, 18-50, living in the west, and iced tea drinkers.  What I found didn’t really surprise me.  When asked about what kind of products the target customer thought Turkey Hill would sell, one respondent said, they “think of turkey and meat and anything dealing with Thansksgiving”.  Another responded with “deli meat” when asked what came to their mind when they heard the name.  Not necessarily what you want to hear when you are selling iced tea in the summer.  When told Turkey Hill was selling iced tea, one respondent said “the product and name just don’t match”.  There were some positives that came out of the chats.  Primarily, the name cast a natural glow on the products, which a lot of consumers are looking for these days.

It might be an outstanding product, but based on speaking with some potential customers, there might be a disconnect between the name and the product.  If anyone knows how Turkey Hill iced tea sales fared out West this Summer, I’d love to hear about it.

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