Posts Tagged consumers
Marketing Metrics: The Emperor Has No Clothes!
Posted by vianova in Cause-Related Marketing, Corporate Social Responsibility, CSR Measurement on May 4, 2009
Clip books, impression numbers, web hits: who believes them? Maybe no one, according to a study reported on by AdAge. Such metrics are commonly used as indicators of ROI, but, according to survey findings, “the problem is that CFOs don’t seem to buy the CMOs’ claims” and meanwhile, “marketers don’t believe their numbers either.”
One example: “Only one in 10 marketer respondents said they could forecast the effect of a 10% cut in spending.” Why? Most approach marketing as an art, rather than a science. Sure, who wouldn’t want to know the relative value of a radio spot vs. a TV campaign vs. a guerrilla marketing effort. But, there are so many variables: how to separate out the power of the message itself, the state of the economy, or the impacts of other campaigns running at the same time? Hard stuff. As a result, many simply default to familiar strategies and metrics, making adjustments around the edges based on logic or intuition.
Indeed, “perfect” ROI evaluations can be demanding and costly. But opportunities abound for “good enough” approaches that are practical to implement, more likely to earn respect from executive management, and actually provide useful marketing insights. A few examples:
- Simple tracking. Charting discrete marketing efforts against contemporaneous sales can, over time, reveal valuable trend information to guide decisionmaking and estimation.
- Replace “reach” with “customer value.” When considering a marketing investment, weigh the cost against the value of the desired sales outcome. Even if this requires highly speculative assumptions about response rates, engaging in “what-if” scenarios can be a powerful tool for revealing weaknesses of traditional strategies.
- Targeted testing. Tracking trends and modeling what-if scenarios will often reveal key questions worth spending some additional resources on answering. Designing “surgical strike” pilot studies or sampling efforts will limit their cost and complement your tracking and modeling efforts
Farron Levy is President of True Impact (www.true-impact.com), which provides web-based software, and consulting services, to help organizations quantify the social, financial, and environmental return on investment (ROI) of their corporate citizenship activities.
Why Customers May Never Care About Your Corporate Social Responsibility (CSR)
Posted by vianova in Corporate Social Responsibility, Sustainability on March 27, 2009
A few interesting studies have been released recently that look at the “Green or Corporate Social Responsibility Movement.” I like to focus on how it impacts customers. So a few recent stats to consider:
- Your messaging isn’t memorable. Over 70% of North Americans are interested in the CSR of the brands they buy, but most can’t identify which brands are socially responsible. (The Shift Report)
- Your messaging isn’t believable. 12% of consumers “seldom or never” believe green claims, while 65% will believe green claims “some of the time”. (Burst Online Insights)
- We don’t know what “Green” really means. Almost 50% of us believe that products marketed as “Green” or “Environmentally Friendly” have a positive (i.e., beneficial) impact on the environment. Turns out that green or environmentaly friendly products are only about being less harmful than prior versions or competing products. Only 22% of us understand this distinction. (2008 Green Gap Survey)
So it’s still a bit early in the CSR movement and the road to success isn’t fully paved, and some confusion in the market is expected. But a general lack of trust from customers in advertising claims and corporate motivations isn’t going to help. Corporations are still focused on the single bottom line of profit, versus the triple bottom line of CSR (profit, people, and planet).
Why isn’t your messaging memorable? Beyond the general skepticism out there, CSR messaging often misses because customers “don’t get it,” as it doesn’t fit with the profile or strategy of the business. It’s what Jim Collins refers to as the distinction between “inputs and outputs of greatness” in his Good to Great for the Social Sectors. Most businesses focus on the input (“how much money do we make per dollar of invested capital?”), but to be memorable, businesses need to focus on the outputs (“how effectively do we deliver on our mission and make a distinctive impact, relative to our resources?”).
Being a good corporate citizen requires CSR efforts that typically fall into one of five areas:
- Responsible business practices
- Environmental initiatives
- Cause marketing
- Corporate giving (philanthropy)
- Employee engagement & volunteerism
All of these efforts impact customers’ perceptions and attitudes. But they need to fit the profile and strategy of the business. It’s not good enough to do these things just for the sake of doing them. Well, it’s certainly better than not doing them. For CSR to be sustainable it needs to be part of the DNA of the business. Drug companies need to partner with the organizations that help those with the diseases their drugs target. Auto part chain stores need to be involved in driver education so we have fewer accidents. Home builders need to partner with organizations that help the homeless. Credit Unions and banks should foster financial literacy/education in our schools and communities. It’s about making a difference at the root cause of an issue that a company and it’s employees have both the knowledge and desire to get behind. These CSR strategies fit the company profile, consumers will “get it” and feel their purchases will have an impact beyond the business’s profit motivation.
In the abscence of data, one needs discernement. CSR is a struggle, and most leaders want to see the data that tells them it’s the right thing to do. We don’t have all the data, but deep down a business leader who is any good should know it’s the right thing to do. Anyone can look at data and make a decision, but in the abscence of data, the best leaders of our time have proved their worth through their ability to discern the right decision, the best next step.
Paul Schwartz is the author of the blog Customer U. He blogs and tweets about customer insight, customer relationships, and how sustainable business practices impact customers. He is also founder and principal of CONGRUITY, a San Diego based consulting firm specializing in customer research, customer retention and customer loyalty consulting.
