The consumer decision making process – Part 2

This is part 2 of the “consumer decision making process”

To review:

The consumer decision making process are the various stages a consumer goes through before they actually purchase a product, and includes: Need Recognition, Research, Evaluation / Comparison, Purchase and finally post purchase evaluation. The time between initial research and purchase is referred to as lead time. The lead time can vary between products and industries based on the cost, importance, emotional involvement of the product.

In the first part, I covered: Need Recognition and Product Research; which you can read about here: The consumer decision making process – Part 1

Evaluation / Comparison
In this stage, the consumer has now narrowed his options down to two or three brands and has to make a decision to purchase from one of these. Decision can not only be influenced by internal factors, but external factors as well, such as reviews and recommendations especially from friends. Facebook encourages people to check-in and leave reviews of different products or brands that you have experience with. Other industries  have other larger review sites such as Zomato for F&B or Trip Advisor for hospitality. These reviews can be shared onto Facebook to promote ‘good vibes’ of your brand. For others who are more price sensitive, it is at this stage that offers can be used to encourage purchase. Facebook provides an ‘offer’ ad type with a ‘buy now’ button which can be used to advertise an offer. In my experience however, a click to website ad type also works very well with offers as it is less direct and encourages people to find out more about the offer first rather than encouraging them to buy directly.
If you have your potential consumer’s email addresses, then a Facebook re-targeting campaign can be done to promote the offer to only those who were interested previously and visited the website. While an offer can be promoted to everyone, by being selective the conversion rate can be potentially higher.

Example – Emirates provides an offer with its Skywards points to encourage people to redeem and book – Now you need only half the usual number of Skywards Miles to make your next great escape. 

 

Purchase
Finally the customer is ready to purchase the product. This can be done on the website on in-store depending on the set up. Social Media can play a part of the purchase process in a few ways. The content to be posted in this stage is quite similar to Evaluation. This can be offers but with an added incentive such as a social media discount, or creating FOMO, or by re-targeting offers to previously interested customers.

 

Post- purchase Evaluation
Just because the customer has purchased the product that does not mean the process has concluded. In fact post-purchase is one of the most crucial stages as it determines whether your customer would be a one-off or a loyal one. While other factors such as brand, or product quality can have an impact, the company also has a role to play. Once the purchase is done, the company can follow up with them to check on customer satisfaction, they can actively encourage people to leave reviews on Facebook and to rate their product. While this can be a risk, in case of a bad product review, it does open an opportunity to engage the customer in solving their problems, get product feedback, replace the item if needed and get a positive review. In fact many people turn to social media to vent and voice their complaints if they are not satisfied. They might not always do this on the brand’s page, therefore it important to invest in a social media monitoring service which can pick up brand mentions from across any social channel giving the company an opportunity to engage and satisfy any unhappy customers, or find satisfied customers whom they can convert into potential brand ambassadors. Because of the dependency to use social media for customer service, brands must ensure they have adequate staff to reply to any complaints, or have a dedicated social channel purely for customer service. Well defined response times should be in place and monitored. Facebook now offers the ability to advertise and interested persons can reach out via Facebook messenger with any queries, if this is the case brands must be able to reply either in real time, or within 24 to 48 hours depending on the urgency and lead time of the product. Facebook provides analytics on response time, the number of messages received and the time taken to respond. All these can be used as KPI’s for customer service. If a customer is happy with their overall experience, they can be converted into loyal customers, which in essence means that, the next time they might want to pick up a similar product either they will stick to their chosen brand or skip the first two stages and go directly to evaluation and purchase, thus reducing the lead time and the time and investment required to convert a customer.

Example – If you see any Emirates Facebook post, their comments are filled with a combination of customer complaints as well as positive stories, yet they make sure that every comment is liked or responded to in a professional and orderly manner.

 

Once you have a better understanding of the purchase funnel, the next question is how would you determine on which stage your customer base is on. There is no clear cut answer to this question as the stages are not as clearly defined. People can move up and down the stages as they get more information or are targeted by more ads. Some industries tend to have distinct purchase periods, such as hospitality has a peak in winter and low in summer; others are consumed so often and quickly that they don’t have defined purchase periods. The more information you have the easier it is:

1) Sales data – look at previous sales data to determine peak purchase periods

2) CRM – your CRM will host customer purchase history, frequency of purchase, repeat purchases etc. all of which can be used to determine any trends

3) Google search – search trends can be used as an indicator of when interest in certain products starts to pick up. It is necessary to first conduct keyword research to fond the keywords associated to your product / brand, which can then be monitored.

4) PPC – If you are running PPC campaigns it can also be a very good source of information to map out your lead time. The keywords used in PPC tend to be across the entire funnel, from generic (which is at need recognition) to keywords associated with offers and sales (evaluation) to brand specific offers (purchase intention). The number of impressions of these keywords determined the frequency of the searches, so by therefore monitoring impressions over time, a time graph can be used to determine when customers go through the different stages.

It is important to keep in mind that the above is only an indication and would not guarantee that these are definitive stages.

The decision making process is an essential part of any marketing activity and is absolutely the most basic and one of the fundamental places to start when investing in a marketing plan and / or a social media strategy.

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The consumer decision making process – Part 1

Someone once told me that social media is a branding tool and not a performance based one, this comment got me thinking; how many people do not include social media as part of their performance marketing strategy and advertising? or how many run social media campaigns as purely brand or strictly promotional campaigns? (i.e only promote offers) if so, they are missing on a few steps in the marketing funnel or consumer decision making process.

This maybe be old school marketing, or marketing 101, but the consumer decision making process are the various stages a consumer goes through before they actually purchase a product, and includes: Need Recognition, Research, Evaluation / Comparison, Purchase and finally post purchase evaluation. The time between initial research and purchase is referred to as lead time. The lead time can vary between products and industries based on the cost, importance, emotional involvement of the product. For e.g. a simple example would be as follows:

Short lead time – Grocery Shopping: there is a need for new grocery items such as bread, you would go to a supermarket, research multiple options (white, brown, wholewheat etc.), evaluate the brands and finally purchase; all within a very short span of time. If you are happy with previous selections then you would pick up the same one you usually do, that is called loyalty which is a product of consumer satisfaction.

Long Lead Time – Buying a car: When you decide to purchase a car, while the need may be transportation, other factors to consider would be size, style, budget, car loan, model, brand, insurance, servicing etc. the number of factors is a lot more and the amount of research and evaluation needed is a lot more considerable, as the investment is also a lot more significant (than bread), therefore the lead time itself would also be a lot longer.

Therefore if you are using social media only for branding (need recognition & research), and for offers (evaluation and / or purchase) you are missing on a few more steps.

Now let’s see how social media can be used throughout the decision making process. As an example I would like to use Facebook. Why Facebook? Well, besides being one of the largest and most well used social networks, I am a huge fan of its targeting options and pixel for analytics. Facebook campaigns tend to have a good success rate, but this is dependent on the targeting, budget and overall creative used.
Note: As instagram is also owned by Facebook, it will be included in this article.

So here’s how Facebook can be used on every stage of the consumer decision making process:

Need Recognition
This is the first step where the consumer realizes they have a need, which a product can satisfy. The need can be anywhere from basic, to psychological, or even self actualization (using a bit of Maslow’s hierarchy of needs), so the industry your business is in would be to satisfy one of these needs.
Social Media’s has a very good ability of creating a need for an item which people did not know they wanted. This is based on the ability to develop FOMO (Fear of Missing out) in the minds of the consumer.  Facebook does this by showing you what pages your friends are interested in, what have they liked, commented or shared, which events they are attending, check ins and encouraging tagging for better reach. Marketers have been capitalizing on FOMO for a very long time, by encouraging people to “book first” or ‘be the first … to wear or own an item (for the trend setters)’, or ‘limited items / seats available’ etc.
Need recognition can be created by a company by posting pictures of their most popular or wanted products, or by showcasing how their product can solve a problem through a video and then promoting this video to your target audience, or by running / promoting competitions which encourage you to tag friends you would want to take with you. Good imagery and /or video combined with effective language can be used to develop a need.

Example – Emirates creates a need or inspires you to travel by showing stunning pictures of the various destinations they fly to – Hello Copenhagen

Research
Now that there is a need, the consumer will then start to research the multiple options and brands that available to satisfy that need, as per their requirements. The amount of time spent on this stage would be dependent upon how involved they are with the item. Social media can be used at this stage to highlight aspects of your product which you believe your consumer would use when decision making. This can be either its price, features, or any other factors that the consumer would evaluate. This content can be presented in multiple ways but not limited to: videos, interviews, infographics, trivia etc.
Social Media can be used to highlight all of the above either through organic posts or advertising. All posts should have links back to the website and actively encourage people to click and visit. By visiting they get to learn more about your brand and your company offering. They can be enticed to either subscribe or sign up, in order to capture their email address which can then be used in Facebook re-marketing. A click to website post type can be used to promote a product with ‘Find out more’ to encourage click throughs. A carousel ad type can also be used if there are multiple products or multiple features.

Example: Emirates showcases their award winning entertainment system which can be a factor for long haul flights – Thank you for choosing us as the “Best Entertainment” at the 2017 APEX Passenger Choice awards.

 

 

To be continued……

 

Brand Advertising: Why do we need it?

Every marketing plan that is actioned is to fulfill a certain goal or purpose. Mostly, it is for the business to generate revenue or to make a profit, which is the case of most businesses, however ‘performance’ driven activities are not the only way to make a business successful.

To explain better, a ‘performance’ activity, is along the line of a tactical campaign, i.e. to generate more business through lead generation, or online purchases via e-commerce. But not all marketing activities can be purely performance based, while it is the primary objective, as a marketing professional, it is important to keep in mind the marketing funnel.

At the start, the first objective should always be about generating brand awareness. Of course there are certain brands who are quite fortunate that they have considerable awareness and aspiration attached to them, such as Apple & Samsung in the mobile phone industry, but not everyone is so lucky, and even if people are familiar with the brand, it is not guarantee that the brand will make it to the consideration set of the consumer, which is dependent on the consumer’s budget, convenience, and other internal values and preferences.

So what is the best way to work with this?

Firstly, it is important to keep promoting the brand as well as the offers. This is essential because a brand is a lot more than it’s offer, and more importantly by promoting the brand regularly, you keep it in the mind of the consumer, which is beneficial especially if they are thinking of, shopping around to purchase your business’ product. But even if they are not, regular brand awareness activities keeps overall marketing costs down in the long run, as less effort and spend is then required to generate brand awareness before a major offer or promotion period coming up.

Secondly, brand awareness activities are also dependent on the actual product. Specifically the life cycle of the product, purchase cycle or frequency of purchase as well as the overall product cost. Products which have a high purchase point, require the additional spend for brand awareness. This is because, due to the high investment required, consumers need to be convinced not only about the offer but also about the actual product and the brand. This usually takes the form of a rational or emotional connection to the brand, which is essential and part of the product they are purchasing. Consumers need to be convinced about the value of the product and of the brand. The cost for brand awareness in these cases is often justified by the high returns through sales.
Products which have a predictable purchase cycle, make it easier to pin-point times of high sales. This can be determined by evaluating sales history to predict key periods. In between these sales cycles, the time can be equally divided between promoting the brand, followed by the promotion of any offer leading up to the high sale periods. This ensures that the brand along with the offer are promoted in time. By sticking to these sales cycles, more efficient use of budgets can be made maximizing on key periods only. For products who have short life cycles or whose key sales periods cannot be identified, it may be necessary to promote the brand throughout the year in small controlled amounts. This keeps the brand in the mind of the consumer without big pushes in key periods.

Third, it is important to consider what will be the message, or what exactly is to be promoted in a ‘brand campaign’. A promotional message, will feature the offer, what’s included in the offer etc. while a brand message, in essence talks about the brand. This includes the brand values, what are its main selling points, or unique identifiers, and what are the brand touch-points. These messages are important, as it is this message that emotionally connects to the consumer and justifies the brand value. Without a brand message, the consumer only buys into the actual product which can impact on overall loyalty in the long run. Consumers who tend to only purchase based on offers, are more interested in short term deals and will most likely switch to another offer or deal, unlike those who are invested with the brand.

But finally, for any marketing activity to be successful it is essential to have a combination of brand as well as offers, however this is dependent on the budget and the level of management support in the company. In cases where there is a restricted budget and / or management requires you to do more performance based activities, all hope is not lost. There are other channels to be used for brand related promotion, two such being PR & social media. Both these channels are excellent for story telling, and brand stories, and also are good and engaging channels through which to connect to the consumer. While normally these should ideally be part of the marketing mix, the usage levels would change as part of your overall strategy.

So all in all, it is important to run brand as well as performance activities for a successful marketing campaign.

How to choose the ‘right’ digital agency

Choosing a suitable agency can be a highly daunting task. There are a multitude of qualified agencies all promising to be the best in their respective fields; how do you find these agencies? do you choose a full service agency or a more specialized one? I’ve put together a few tips from my experience of trying to find a good agency.

  1. Full – Service or Specialized?
    Firstly, it all depends on what’s the reason for getting an agency. Is it to handle all digital services or for a specific activity such as social media, search marketing etc. If it is for all digital services, then a full serviced agency would be more beneficial. This is not only because they have a wide variety of skills which could benefit the company, the more investment larger agencies receive, the better discounts and services they will provide. If you are looking for a specialized service then usually smaller boutique agencies are preferable. This is because they are more focused on a specific activity and can provide dedicated services, for a smaller budget.
  2. Local or International?
    If the target market is located within the UAE, then a local agency would be essential, but what if the market is global or in another country? Is it better to have one agency handle all markets or find a local agency within that market. Again this is dependent on the overall business strategy of the company. Most agencies find it more cost effective to go with one global multinational agency who have localized agencies in other countries, it makes it easier to deal with and they provide an integrated strategy, but if it is only one or two other markets then perhaps it is better to invest with a local agency there.
  3. Locating Agencies
    The next step would be putting together a list of agencies based on your requirements. Ideally the best place is to look for them is on Google (and being digital agencies I would expect them to have a strong presence online). Full serviced agencies can be found by looking for ‘digital agencies’ or ‘digital marketing agencies’. It is important to keep in mind that most traditional brand / creative / media buying agencies have also entered this space and offer complete digital services, so you can find agencies using those search terms as well. In the search results (SERPs), you can find out more about about each agency through their meta title, or their PPC results. In each of the ads, agencies specify if they specialize in a particular activity such as ‘SEO’ or they are complete ‘digital marketing’ agencies. I also prefer using third party sites such as: https://digitalagencynetwork.com/agencies/ or using organizations such as eConsultancy and their preferred lists which provide recommendations.
    It is important to consider the location of these agencies.
  4. Selecting & Shortlisting Agencies
    Once an agency list has been created, it is important to narrow them down. This is one of the more daunting tasks that need to be done. It is important to look for the following: Clients, Experience, Awards, Case Studies.
    Most agencies will have a client list on their site, but it is important to understand what work has been done for their clients. If they work on social, then check out the social pages and see how they are being managed, if they are handling search, review their SEO or check out their PPC ads to see how they are set up. Most agencies also have multiple case studies to support their claims. But it is not enough to say what work is being done but what are the results that have been achieved. Finally, it is also useful to look at what awards (if any) have been won by the agency and for any specific work.
  5. Deciding on the agency
    Once a shortlist has been put together the next stage would be to either send a Request for Proposal (RFP) or ask them to send across a proposal based on your needs. An RFP is a structured document with a list of requirements, however it is also possible to contact them and ask for a proposal. It is up to your discretion to provide a budget for the activity or not. In most cases businesses are not sure what the budget should be, so they ask the agency to advise which is quite normal, however it is important to consider how the agency costs. Is it a percentage of media spend or a flat fee, this would affect how much is taken by the agency and what’s left for the actual spend, so the final decision would be based on overall budget.

Is there anything else to consider, that I may have missed out?

Marketing: In-house vs Outsourcing? Finding the Balance

When it comes to marketing does it make sense to have in-house talent or would it be better to outsource to a specialized agency?

Most companies fall somewhere in the middle of this broad spectrum, where in-house marketing strategy is supported by agency execution, of course this also depends on the type of marketing activity which is being performed.

Most Brand marketing, is usually done in-house, where agencies are used to support specific tasks such as creative concepts and execution for a marketing campaign. Campaigns can be short or long term, with multiple agencies working on a similar project.

For Digital marketing, decisions have to be made on an activity level as different channels need varying levels of expertise. The decision is also dependent on the number of projects or brands that need to be worked on. Digital Marketing channels include:

  • Social Media
    This is the most common and ‘go to’ channel for digital needs, however there are a lot of factors to consider before deciding to outsource. Firstly social media takes a lot of time to manage, develop and engage. Many businesses choose to employ a dedicated executive to handle social media accounts especially if there are multiple channels, multiple brands, or the company is involved in a lot of events and live activations. Having an in-house resource means they are more familiar with the brand, the target market and language style to ensure a seamless experiences across other advertising channels. However outsourcing to an agency has its own merits. Agencies have more experience but care has to be taken they don’t do similar work with competitors, agencies also charge by the number of channels they need to manage, how often they post and the number of events they are expected to cover. Also social posting needs someone who can create a brand story, and most agencies are not well connected to the brand or to the target market to understand their needs and what they respond do. Of course this is not to say that agencies cannot do a good job, they can as long as there is a good understanding. So this decision needs to be made on a business level and looking at the cost / benefits of either option. If the business has the resource then social is an activity which should be kept in house and close to the brand.
  • Paid Media
    This activity refers to digital advertising across multiple channels such as social, Google Adwords, Display etc. Media buying is usually an agency led activity. There are a few businesses who do it in-house, but this is dependent on the the number of products or the overall size of the business. If it is a small company with one or two products it is relatively easy to manage this activity in house either by a marketing exec or direct by business owner; however if this is on a larger scale, then it is more profitable to outsource this to an agency. Most agencies work on operating margins, therefore while they conduct media buying they can work across multiple accounts to get better deals. Advertising optimization is also a time consuming and specialized activity which requires professionals with experience or managing campaigns can be an expensive affair. They are also more in tune with the different ad formats available and which would best for the media activity. But most agencies usually charge either a minimum spend or % of overall media spend which may work out better depending on the number of campaigns that are being run. Possibly one solution to this is to let agencies manage the media buying and optimizing while having in house expertise to manage the campaign strategy, channel selection and overall plan.
  • Organic Search
    A highly specialized and often technical activity, organic search is a long term investment and requires a high level of expertise and connections with media and bloggers for link building, and an understanding of website architecture to review technical SEO. Most businesses outsource this to agencies, who work on a retainer basis and conduct a set amount of optimization activity per month. However it is strongly recommended to have in-house SEO expertise who can set SEO strategy according to overall business strategy, cater to business objectives and review agency activity.

There is no easy decision when it comes to in-house vs. outsourcing of marketing activity, the best option is to review the below factors before making a decisions:

  1. Size of Business / Level of Activity
  2. Cost & Marketing Budgets
  3. Digital Expertise required

While there is no ‘one’ overall solution digital marketing requires a combination of in-house brand management and digital know how combined with the execution expertise, industry experience and media buying power of agencies. Usually a merger of experts from both sides of the business proves to be overall beneficial for the business; it’s all about finding the right balance.

So, how does it work in your company?