The Social Trust Economy: What is it, what is its currency and how do we trade?

Social | so·cial [soh-shuhl] adjective

Pertaining to, devoted to, or characterized by friendly companionship or relations: a social club. *

Trust | trust [truhst] noun

Reliance on the integrity, strength, ability, surety, etc., of a person or thing; confidence.*

Economy | e·con·o·my [ih-kon-uh-mee] noun

The management of the resources of a community, country, area, etc., especially with a view to its productivity.*

*Definitions are adapted from Dictionary.com

When attempting to manage something, it is always best to understand what it is we’re trying to manage. For example, if one were to attempt to manage confusion, it may come as a shock when presented with a large group of guinea fowl (yes, it is one of those weird animal group names). With the excitement surrounding the business potential in social media, wouldn’t it be nice to start with a great definition?

In our economy, the transaction of goods and services is based on an agreed-upon standard unit of measure known as currency. Economists constantly evalulate and traders constantly trade to determine the value of one currency against another such that when a transaction takes place anywhere in the world, a common, “fair” value is placed on the transaction. In our society, we intrinsically understand the “value of a dollar,” as my parents used to say. I don’t know if there is an apropos translation for Rupee, Ruble or Real, but you get the point. A buck will get you a small Frosty at Wendy’s just about anywhere except the airport, but that’s another value discussion altogether.

So it follows that if businesses intend to truly monetize their value proposition via social media networking in a meaningful way, we should establish the ground rules for the social economy. I propose the primary social currency is trust.

What is it?

It appears the social trust economy is a confluence of social and technological trends uniting to form the foundation of a new value system. In fact, some interesting work by Hans-Werner Bierhoff and Bernd Vornefeld in 2004, suggests such a basis. In their paper, The Social Psychology of Trust with Applications in the Internet, they assert “Three levels of trust as a social psychological construct are delineated: trust in a specific person (relational trust), trust in people in general (generalised trust) and trust in abstract systems. Whereas much research is available on relational trust and generalized trust, much less is known about trust in systems.”[i] Trust in systems was a new concept with regards to the Internet in 2004, but it seems far less so today, as seen in an Orbital Alliance Blog , “Adults Ages 50-64 had the biggest spike in daily usage growth of social networking sites. In 2008, they were at only 2%, and now in 2011, roughly 1/3 of all boomers use social media on daily basis. They increased over the past year from 20% to 32%.”[ii]

That’s right, even gray-haired baby boomers like me have now adopted social media at a level that indicates an inherent trust in the medium. Growth in trust-based referrals, like those found on LinkedIn, Angie’s List and agnostic evaluation sites like Software Advice seem to indicate that a dominant portion of our social fabric is transacting business via the social trust economy.

While no individual, by definition, can dictate or create an economy, I have a theory on the forces at work in this new economy. I hope this article serves only as a catalyst to begin the debate, but I’ve always found it easier to begin the discussion with something other than a blank screen.

I believe three major trends form the cornerstones of the social trust economy:

1.      Proven trust authorities

2.      Big Data

3.      Social networking with local permissions

We have collectively conducted trillions of successful transactions over the Internet without an infrastructure implosion based on fraudulent transactions. Not to say they don’t exist, but they are rarely a technical infrastructure issue. Hacks of any consequence can usually be attributed to insider information or low-tech invasion techniques like reading passwords off sticky notes. (Frankly, if someone has the smarts to break 128-bit encryption, he or she is going to be sorely disappointed after breaking into my checking account.) The first cornerstone is proven trust authorities like Verisign and Trust-e, who have created a branded acceptability in secure, online transactions. These organizations live and breathe trust, and have created a sustainable brand promise by never breaking that trust.

The second cornerstone is Big Data, providing us with broad, anonymous consensus. Anyone who knows me understands I am a big fan of Cialdini’s Principles of Ethical Influence, and consensus is one of his six principles. Big Data provides us with consensus on a previously unattainable scale. Although in the abstract the possibility exists, it seems nearly impossible that 30 million people could be wrong, doesn’t it?

Big Data provides us with the ability to establish a real currency valuation of trust with a value proposition based on Big Data rating systems. As an everyday example, if you were to read in the App Store that a game has received a 4.5-star rating from over 30,000 people, doesn’t it seem worth ninety-nine cents?

The third, and final, cornerstone is the concept of broad social interaction with local permissions. FaceBook pegged this concept, and it completely explains the broad-market appeal to older demographics. The underdeveloped frontal lobes of adolescents can connect well in the “I’ll show you mine if you show me yours” world of social networking, but even twenty-somethings want to control their privacy a bit more than that. Baby Boomers were non-existent on MySpace, but from 2008 to 2009, Boomers (Age Age 44 – 62) who maintained an active profile on FaceBook, increased from 14% to 46%.[iii] We want to maintain our personal privacy, but I’ve many Boomer friends who openly admit to being online voyeurs, interested in the online antics of friends, family and, sometimes, complete strangers.

What is the currency of the Social Trust Economy?

Trust. It seems implicit, doesn’t it? But how do you measure it and how do you monetize it? I had a friend say to me recently, “You’re one of only two [members of a certain executive group] I trust. So, it seems I own some currency in the trust department, but how do I attach scale to it? Do I own more or less trust than that other guy? Let’s go back to confusion (a group of guinea fowl) and determine that we need to place some definition around trust before we attempt to commoditize or measure it.

I propose the first assumption we can wrap around trust currency is that it is, in fact, exchangeable. What good is a currency you cannot trade for something else? That leads to the dimensional question: what composes a unit of trust? And, from that, what is a unit of trust worth?

Back to Hans-Werner Bierhoff and Bernd Vornefeld, who posit, “A perceived risk to suffer a loss is counterbalanced by information which reduces the risk. Such information includes contracts, system trust, and more specific trust.” Can we imply from this that a unit of trust may be equivalent to a unit of risk mitigation? This seems further substantiated in Lynne Soraya’s story of a chance encounter with a con artist with a “Salesman’s Smile” in a discount store.[iv] What would a person be willing to exchange in return for trustworthy information about a person or group of people? It seems businesses and consumers alike are willing to pay for background information on everyone from job seekers to babysitters. They are quite literally purchasing units of trust.

How about the value of time? Is trust worth time in a fair-value currency exchange? According to Dr. Bill Knaus, “You are vulnerable to lies and deceptions when you don't know the facts, the situation is fuzzy, or you want to believe.”[v]  Would a unit of trust offset the research required to fill in the facts, clarify the situation or discover whether consensus supports or refutes your belief?

Time and risk mitigation seem to be two valuable currency equivalents to trust in our economy. So how do we assign value for businesses not trading directly in trust, such as background checking, Internet transaction security or property & casualty insurance?

How about Klout? Fernandez, Tran and company seem to have created a viable set of SMART metrics for measuring social influence – doesn’t this qualify as a monetizing trust currency? All three cornerstones of the social trust economy are present. They have combined Big Data with local social permissions to become a trust authority.

Let’s look at another example – an old-school example – of the social trust economy in action: broadcast television. It works and it works well. The big 3 (ABC, CBS and NBC) continue to compete favorably with new networks, pay cable networks and pay-per-view programming, even though they are free to the viewer. (OK, free to those who still receive SDTV over the air received by an antenna.) These networks continue to survive because they are trust authorities (viewers trust the production value of their programming), they embrace local permission (viewers can change the channel if they don’t like what’s being broadcast) and they take advantage of Big Data (anybody remember those set-top rating system boxes?) to determine user preferences.

While we, in the USA, are generationally inculcated to understand the viability of network TV, apply that financial model to your industry. Would your organization remain viable if you were the only competitor offering your product or service free to end users while all your competitors charged for the very same product or service? It is counter-intuitive, but in a social trust economy, it works.

How do we trade in the Social Trust Economy?

Unless I’ve missed something drastic, there exists no 100-unit certificate of trust redeemable at your local Apple Genius Bar. Or any other kind of bar, for that matter. So begins the discussion on exchange, or the process of trading in the currency of trust. Referring back to Dr. Knaus, he believes:

You can add to your confident composure through enlightened skepticism. Ask yourself ten enlightened skepticism questions to gain clarity:

1.      What do I know about the speaker's truthfulness?

2.      Is the statement consistent with reality?

3.      Can I verify the statement?

4.      What do I gain by accepting and acting on the statement?

5.      What do I lose by accepting and acting on the statement?

6.      What does the speaker gain if I bought into the statement?

7.      What is exaggerated or downplayed in the statement?

8.      Does the idea seem too good to be true?

9.      Would I advise my best friend to accept the statement without a question of doubt?

10.  What doesn't compute? (Is something being said too emphatically or in some strange way?)

How much time and effort would it consume to gather, compile and evaluate a statistically significant sampling of answers to these ten questions? Social media provides access to relevant Big Data sampling through proven trust authorities get us to those answers quickly and reliably. That certainly provides the basis for a valid currency in our social trust economy.

What’s next?

I think it’s up to you. I hope this article will serve as a catalyst to get bright marketers everywhere contributing to construction of this micro economy of social trust. What are your thoughts on time-to-trust currency equivalents? How about risk-to-trust? How would an entity create a trust bank? Does trust currency accumulate or is it depleted as it is used in transactions?

Because you are here, you are a de-facto member of the social trust economy. I’d love to hear your comments and feedback as we collectively explore new avenues for creating value in the social trust economy. Don’t just “think out of the box,” think outside any universe that requires packaging at all.

© 2011, Stephen D. Turley. All rights reserved.  

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[i] The Social Psychology of Trust with Applications in the Internet, Hans-Werner Bierhoff/Bernd Vornefeld, Analyse & Kritik 26/2004 (c Lucius & Lucius, Stuttgart) p. 48–62

[ii] Orbital Alliance Blog, Baby Boomers have largest growth in daily Social Media Usage, Posted on Aug 30, 2011, http://www.orbitalalliance.com/blog/2011/aug/baby-boomers-have-largest-growth-in-daily-social-media-usage.html

[iii] Deloitte, "State of the Media Democracy, Fourth Edition:Select US Highlights," provided ot eMarketer, December 15, 2009

[iv] An Encounter With "The Salesman Smile" If you can't read facial expressions, how can you judge sincerity? Published on December 23, 2010 by Lynne Soraya in Asperger's Diary

[v] Protect Yourself from Liars and Deceivers; Expose those who try to deceive you. Published on April 25, 2011 by Dr. Bill Knaus, Ed.D. in Science and Sensibility

Five foundational building blocks for successful B2B email campaigns in the Social Trust Economy

If your job involves anything related to demand generation, you have been asked this question: what makes an email successful? More often than not, the actual question is couched in tactical execution terms completely unrelated to the actual objective of email communication. That question sounds something like "What are the best practices for creating successful emails?" Experts often respond with well-researched and tested tactical execution terms, contributing to what I consider an alarming trend in the demand gen community: email communication has become a commodity.

Dozens, if not hundreds, of companies offer pre-fab email templates, drag-and-drop functionality and plug-and-play widgets for dashboard metrics. Don't get me wrong; I consider myself a net promoter of these tools and I would not advocate banishment from your demand gen tool box. In fact, a talented and creative professional can maximize ROMI utilizing these tools and deliver smashing results. The tools are not the problem. The loss of message focus is the problem. It seems that technological advances in marketing automation technology have lulled marketers into a false sense of security about the importance of relevant messaging. It's almost as if some believe compelling content is found on aisle 14 in the widget section at Wal-Mart.

Yes, deliverability, sender scores and browser optimization are important, but they are TBU* if the message is irrelevant, uncompelling or misdirected. (*True, But Useless. Borrowed from an analogy in Chip and Dan Heath’s book, Switch.)

So, when asked about highly effective B2B email best practices, I start with my five foundational building blocks.

1. You need a clever hook. Clever says more with less. Clever is visceral. Clever gets to the point. Clever requires little from your reader, yet offers an immediate and tangible reward. In order to evaluate "clever" in terms of a meaningful metric, let's apply a little A-B testing. Which is more clever?

A. I regret to inform you that I strongly disagree with your demeaning and overbearing management style and am submitting two-week's notice of termination of my employment.

B. Take this job and shove it.

A. My sincere hope is that your happiness will not be limited by your inability to engage in risk due to your relational insecurities.

B. I hope you dance.

If you chose "A" in either case, please consider a career in Human Resources. If you're unimpressed with the country music song titles, I'd bluntly suggest you invest some time listening to some of the best hook writers on the planet. Love it or hate it, you will learn something.

2. You need a compelling MTFV (more-than-fair-value) offer at the heart of your CTA. Your MTFV offer should deliver substantially more value than you expect to receive in return. We now live in the social trust economy: it's the law of reciprocity at work in an economy where trust is brand currency. In Steve Woods' latest book, Revenue Engine, he notes the well-documented rise in social media influence. In just two years since initial publication, Eloqua's Revenue Performance Management model now requires the addition of a third foundational tenet:

• Who you are
• What you want
• Who you trust

Ask yourself how much credibility you are likely to build using insignificant, branded trinkets and product brochures as currency in the social trust economy. Then come up with a real MTFV offer.

3. You need to build into your campaigns a sequential, incremental buy-in process. Not a singular interaction, but process. Even seemingly inconsequential B2B purchases are rarely conducted as single interaction. Consider how much research, analysis and socialization can be involved in the procurement of a five-dollar ream of copy paper? Knowing this, should you not expect that your email message is only one step in a series (or, depending on your sales cycle, a very long series) of iterations? If you anticipate your communication to be serial and sequential, your expectations for the reader's likely response is properly set and you can engineer a roadmap based on that likely response.

Match your message to that buyer's journey and use your response expectations to create a logical roadmap to success. Use your technology tools here to provide choices for next steps or content delivery preferences, removing roadblocks from your buyer's journey. Will the next question be how much will it cost? Provide cost calculators that can pre-populate an order form. If the next question is most likely to concern delivery time, find creative ways to integrate your production schedule data to create availability estimates. Get creative. Better yet, get clever!

4. Now that you know or message is going to be serial, you must create logical, intuitive navigation to guide your reader through your sequence. A well-deserved shout-out to the late Steve Jobs: think iPad gestures, not Ctrl-Alt-Del. Simple is almost always better. In an earlier blog, I related how my hypothesis that email readers will do what you ask led to a test that yielded 35% to 700% improvement in CTR. Ask your readers. In plain text copy. Above the fold. Examples:

When can we deliver your order? Estimate your delivery date now >
Need monthly delivery? See how much pre-ordering will save you here >

I favor buyer-centric language directly related to the CTA offer to overused and under-delivering tool names like ROI or TCO calculator. Unless you're actually selling calculators, of course. I intend to test this hypothesis in the near future, so stay tuned to {Demand Gen Brief} to see how much real performance improvement you can realize with another simple practice.

And remember serial messaging! Don't just stop with your useful tool; integrate an obvious navigation roadmap to guide your reader to the next logical step in your messaging.

5. Last, but certainly not least, you need a pre-defined, quantitative objective for your every step in your email campaign. If you think of your email campaign as a subset of your marketing funnel (you are thinking that way, right?) it is straightforward to design your campaign objectives in exactly the same way you design your funnel. This also forces you to think in quantitative terms, such as 100 MQLs, instead of imprecise terms like as many leads as possible. Reverse-engineering from a hard objective makes it very simple to figure the requirements for each stage in your serial campaign.

In review, the five foundational building blocks are not about HTML trickery or optimization techniques, but solid way to build credibility in our new social trust economy. Like any building project, unless your foundation is level, true and plumb, nothing you build on top of it will be right. So forget optimization until you have the foundation correct.  I hope you find these building blocks to be constructive as you plan your next email campaign.

© 2011, Stephen D. Turley. All rights reserved.

One Simple Practice to Increase CTR up to 700%

Most demand gen professionals and email marketers are consumed with iterative testing to improve the performance of their marketing efforts. I follow the same practice, of course, and over the past ten years of email testing I have found one simple practice that immediately improves click-through rate (CTR) for literally every email tested. Better than knowing this practice, however, let me first share how I discovered it.

After tiring of the small, incremental gains of 1 to 3% using iterative testing, I began a practice of hypothesis-based testing about eight years ago. It is simply applying scientific method to the practice of email deployment. These single-blind tests (the user was unaware of the test or which version of the test they received) led to some amazing increases in both web site and email performance. In this case, I began with the hypothesis:

I believe email readers will do what they are told to do.

Despite studies at the time indicating the best practice was use of graphics-heavy HTML emails, I believed that users would react better to not having to search for a button or guess what the button would do if clicked. My hypothesis extended to placing a text link for the Call to Action (CTA) at or near the end of the first paragraph of the email body copy, as shown here:

Over the course of hundreds of tests, this CTA has proved to consistently outperform any other link location or method from 35% up to 700%. Yes, it outperformed that big, red “Learn More” button and both text links in the right-hand column.

Of course, you need to avoid SPAM trap wording like “Click Here,” but other action words like download, join and discover work very well. A few, simple guidelines:

•  Write your link in plain English and let the language flow naturally from your copy – don’t try to force something that doesn’t fit.
• Make sure your text link is well above the fold.
• Of course, your CTA needs to be relevant and compelling to your audience. Don’t expect this (or any) best practice to compensate for an irrelevant or uncompelling offer.

So go ahead and hypothesize, test and repeat. And respond back to this blog when you have results. I’d love to hear about them!

© 2011, Stephen D. Turley. All rights reserved.

Marketing Measurement: Back to the Basics

{Demand Gen Brief}        October, 2011

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Home field embarrassment

The score was 47 to 3, and the home team was beyond embarrassed. The offense was listless and the defense couldn't stop a bowl of molasses. While the team walked dejectedly to the locker room, the on-field TV announcer stopped the coach. "What went wrong today, coach?"

"Well, we got stomped because we needed to increase our passing efficiency by 2.7% and improve our run defense by 0.7 yards per carry."

What?

Ok, I've never heard such a ridiculous answer, either. What I have heard consistently after a thorough defeat goes something like this: "We're going to go back to the basics - fundamental blocking and tackling." I've run into this frequently in the world of demand generation, and it may be time for you to ask yourself the same question about your organization's approach. Is it time get back to the basics?

Bad Company

Let me give you a couple of real-world examples and see if this sounds like your demand gen practices. An organization recently built a closed-loop tracking system that enabled them to track user clicks from source to destination using query strings. The new capability could track a user who clicked from a Google AdWords ad or an outbound email campaign all the way to the download of a white paper PDF file. At download, a blind submit form registered the download and assigned a coded campaign status to the user's contact record and updated the associated campaign in the CRM system. Enamored with the new ability, this organization buried links within the white paper PDF file to a form... to download the very same PDF file.

In another example, an organization got in the habit of sending three separate invitations to online events in a series from an automated event management system. Increasingly, they found registrations dropping off with each successive invitation. I did some digging into their email stats and discovered they were not only failing to significantly increase incremental registrations, they were receiving twice as many unsubscribes as registrations and were damaging their sender reputation due to complaints. The client, aware of my studies and success in improving click-through performance was wondering if I could apply my wisdom to the problem. In response, my first question was "What did additional value did you offer in the successive invitations?" The question was met with silence. After a moment, the client admitted the three invitations contained identical content and nearly identical subject lines, only adding the word “Reminder.” I am still awaiting an answer to my next question: "If they didn't respond to your first offer, why did you think they would respond favorably to the very same offer twice more?" The fact is, their prospects did respond... by unsubscribing.

Pump it up – until it pops

The point of these illustrations is not to simply point out myopic marketing practices, but to point out the focus necessary to really create demand. While technology provides us with wonderful tools to execute out tradecraft and measure results in ways never before possible, we must always remember that demand generation is a craft. In my seemingly unending repertoire of sports analogies (my apologies to non-sporting readers) I have often related the golf club metaphor. While I can buy the latest golf clubs that will, indeed, add yardage to my driving distance, that technology only helps me reach the water hazard or bunker I could never before reach. Tiger Woods could still beat me with his grandfather's clubs and an umbrella for a putter. The analogy in the demand gen world is that even the best marketing automation technology can only help us if we are already executing our craft very well and our systems and processes are structured to support well-conceived business objectives.

Technology only allows your organization to increase the amplitude - or turn up the volume - on your already existing business processes. In the case of one client, it allowed them to make 80,000 mistakes in a matter of seconds when an over-zealous marketer released an email without adhering to a QA process I had strongly recommended. Needless to say, that event led to immediate reconsideration of my process recommendations.

Lost in Space

Back to our original premise – the basics. As a CMO, has automation caused you to shift focus from absolute measurement to relative measurement? Do your metrics illustrate a percentage year-over-year revenue increase, market share increase or ROI on marketing activities? It is common to focus on the relative and lose sight of absolute measurement of your craft. While relative measurement is useful in determining your position relative to your last measurement, it can actually provide a false indicator of real progress towards your business objectives. How can that be? Let's examine a non-sports analogy this time.

Say you are sailing from Mobile, Alabama to Cancun, Mexico, which is a nearly due south course along 88-degree west longitude. You have installed the latest GPS device and programmed in your destination coordinates of 86.50 by 21.10. As you progress towards your objective, the GPS dutifully reports your course, location, speed, distance to and time to destination. Based on the numbers, everything is fine until you bump into the west coast of Florida and discover you had set a course for somewhere in the Bay of Bengal off the coast of Calcutta (you cartographers can have some fun with that one). Relative numbers are only helpful in the context of a clearly-defined overall objective. Let's look at one more real-world example.

After installing a best-in-class marketing automation system and getting their feet wet with a few campaigns, a client decided to push the "more" button. The organization quickly became used to the high velocity with which their new system could distribute campaign messages. Within mere months, the objective subtlety shifted from distributing quality messaging to distributing quantity messages. A metric was created to measure email sent per month, even though that metric had absolutely nothing to do with strategic objectives and had little to do with revenue generation. Unaware of the impact 1.3 million emails per month had on sender score, the organization continued this volume for months. I ran some tests and discovered their sender score was slowly declining and complaints and unsubscribes had reduced throughput to in-boxes to less than 80 percent. 360,000 emails per month were never seen by the recipients and, of those who did receive the emails, unsubscribe rates nearly equaled click-through rates. So much for email volume as a viable marketing metric - at least without a relevant context.

So what, then?

We've looked at a number of things not to measure, so what about metrics we should measure? Open rates? Yes. Click-through rates? Certainly. How about A-B testing of subject lines? Definitely. These will help you understand single-message performance retrospectively, and that is a good thing. However, exactly how much is that A-B subject line test going to really help you in designing a different product email campaign to a different audience? To accomplish that, you need something a bit more sophisticated, like a sender/relevance score and an offer/relevance score. A sender/relevance score is an indicator of how likely a recipient is to open your email message, and an offer/relevance score is an indicator of how likely your recipient is to click through to your offer.
Each of these scoring systems presents a methodology to review recipient tendencies with a forward-looking focus, rather than a retrospective performance focus. The primary difference between performance measurement and indicative measurement is the application of cumulative performance data analysis based on specific, contextual hypotheses. Let's look at a specific example of an organization overly concerned with performance focus without a forward-looking context. This organization was (rightly) concerned with email open rates and conducted numerous A-B tests and applied best practices they had read about in online articles much like this one. They determined that "best practice" subject lines contained fewer than 35 characters, and ran tests on subset of distribution groups to determine the better performer of two subject line candidates. The problem was that testing was retrospective only, and was without a contextual hypothesis, so when I asked the question, "So how will this testing shape your next subject line?" I was met with silence. Someone finally mumbled something about testing and best practices of 35-character subject lines, to which I asked whether or not "My product stinks" contained fewer than 35 characters. While radically idiotic, it merely exaggerates the effect of blind adherence to "best practices" without a context.

Text without context

What would context look like for your organization and product or service? While it will be different for every organization, the framework will be very similar, no matter the product or service. Sender/relevance score reflects a structured coordination between the individual and corporate sender address and the subject line relevance to the recipient. This score is dictated by two framing questions applicable to any organization or product:

• Does the sender have a positive relationship with the recipient?
• What relevant recipient question does my email answer?

It is important to note that for any given point in time only the second answer is variable; your sender(s) either have a relationship with the recipient or not. By assigning a score to your email batch, you can evaluate the likelihood your emails will be opened. For example, if each of the two components can carry a maximum of three points, a perfect score would be a nine. There are a number of ways you can rationalize this score to an absolute probability, but the key is to initially understand the reasons your emails are being opened or not.

In short, if the sender has a good personal relationship with the recipient, he or she is more likely to open the email regardless of the subject line. If the recipient has no relationship with the individual, but is familiar with the sending organization, there is a possibility he or she will open the email, but is much more likely if the subject line is relevant. In the case where it is unlikely the recipient knows either the individual or the sending organization, there is little likelihood the recipient will open the email unless the subject line is relevant, compelling and a bit provocative.

The offer/relevance score works in a similar fashion, but is used to determine a recipient’s propensity to click through to a call to action offer within an email. This measurement requires a careful balance because the relevance needs to be considered bi-directionally. This is very important, because if click-through rate (CTR) is not considered in a relevant context, the CTR results can contraindicate your program effectiveness. Let’s look at a specific example.

A client wanting to show high response rates to a specific email campaign promoting an online webinar chose an external vendor to create the content, present and host the webinar. A topic highly relevant to the target audience was chosen. The email was successful in filling all available seats to the webinar within a couple of days, creating a waiting list of an additional 50% of the webinar capacity. Open rates were high at over 25% and CTR for the email was outstanding at nearly 40%. Mission accomplished, right? Wrong.

It turns out that, while the webinar topic was very relevant to the target audience, it was completely irrelevant to the sending organization’s goals. The objective of creating sales opportunities was completely lost on the target audience, whose primary objective was accumulating free CPE credits. At a very large expense in both time and money, this organization netted zero sales leads as a result of a mismatch in sender relevance. When considering the cost per lead, this campaign is the worst possible disaster while achieving outstanding open and click-through rates.

Are we thrilled at the prospect of campaign execution scale and quantitative feedback our Marketing Automation and CRM systems can provide us? Yes! Do we need to get back to the basics? Absolutely! Is there a gap between pure marketing craft and marketing automation skills? It’s wider than you think! We will take a look at how to bridge the gap between marketing craft and mechanical execution in the next edition of {Demand Gen Brief}.

© 2011, Stephen D. Turley. All rights reserved.

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Lead Nurturing: It’s Not Just Poor Semantics, It’s a Non Sequitur

{Demand Gen Brief}         September, 2011

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We have process, right?

If you are reading this article, chances are good your organization has built, or is in the process of building standardized processes for lead processing. Whether you have adopted a “waterfall” model or created your own variation, your model should closely represent your buyers’ journey from anonymity to closed business. Your model should be based on lead taxonomy and stage definitions unique to your solution(s) and buyer personas. (If not, we need to have another discussion entirely!) Let’s proceed on the basis that your process is defined correctly. So, we’re good, right? Maybe not!

Houston, we have a problem!

The issue is very likely hidden in the cracks between your process definitions, and should profoundly affect the way your organization approaches this step. In the Demand Gen world, it’s a basic tenet that you don’t nurture a lead being actively worked by sales. And yet, does your process indicate a single “lead nurturing” process similar to this over-simplified diagram?

If so, your organization may be missing out on a critical component of nurturing: the process is the same, but the intent is entirely different!

Two sides of the same coin.

In your buyer’s journey from anonymity to lead – especially in the B2B world and more so for long-cycle products or services – there are actually two distinct nurturing phases. Each phase may contain subdivisions unique to your buyer’s journey, but the process intent creates two distinct classifications:

1. List2Lead Nurturing: the process of moving the buyer from anonymity to involvement
2. Lead Nurturing: the process of moving the buyer from involvement to investment

To best illustrate both the similarities and the differences, these two classifications are best viewed on a chart measured against process intent, using a specific intent model.

Regardless of your organization’s intent model, nurturing is designed to simultaneously prompt buyer action and allow the buyer to move on his or her own schedule. Notice that there is functional overlap, but the difference in intent dictates we need two distinct processes to accomplish two distinct objectives.

Metaphorically Speaking…

As marketers, we are often too close to our subject matter to objectively see the fine differences in our own value propositions when viewed from a buyer’s perspective. Often, the best way to see those differences is to objectify them through metaphor. For example, if your organization sells financial services to businesses, change your metaphor to selling office furniture to the same set of businesses. The intent and movement along the buyer’s journey are similar, with your market nuances shaping the message delivery based on buyer personas and the value your product or service delivers.

Since the objective of Demand Generation is to create demand, it implies there isn’t necessarily an intrinsic demand. This is especially true if your product or service is innovative or new to the market. Even if your organization is an established market leader, we cannot assume that your prospects will automatically self-select into your lead process. We use a combination of inbound and outbound marketing channels to invite prospects into our lead process. This is where the nurturing processes diverge.

List2Lead Nurturing is focused on the movement from anonymity to involvement. Nurturing tactics in the List2Lead phase should be specifically targeted at generating involvement, not generating leads. This will seem counterintuitive to many traditional marketers and all of your sales team, it makes perfect sense when viewed from the buyer’s perspective. Let’s go back to our metaphor. Does your organization decide one day to trash its existing investment and purchase a new suite of expensive office furnishings without proper due diligence? (If so, Herman Miller wants to talk to you immediately!) Let’s build a buyer’s journey for that kind of purchase.

Start with “why buy?” What are the questions you would ask? Are the questions you are asking at this stage about the high-level advantages of new office furniture, or are they about fabric swatches and finish styles? How would you get those questions answered?

This is the List2Lead Nurturing stage. You are asking your buyer to become involved in the process, not make buying decisions. Your well-designed List2Lead Nurturing process will guide your buyer gently through the “why buy” question and into the “why buy from [your company]?” question with little friction. During this process, you will have demonstrated five of Dr. Robert Cialdini’s principles of ethical influenceⁱ (Reciprocity, Authority, Consistency, Liking and Consensus) and be well on your way towards properly positioning your organization for the next phase: real Lead Nurturing.

Let’s get real.

At this point, it may be occurring to you that you have many of the elements of List2Lead Nurturing as a part of your lead nurturing program already. What’s the point of changing your existing program if the components are already there?  The question can be answered by examining your own lead taxonomy. For example, if you are using BANT criteria, how many of your “leads” currently have an established budget? Authority? Right, that’s why Lead Nurturing is a non sequitur. Real lead nurturing only exists when your prospect is, or is very close to, a lead by your own definition. Real lead nurturing exists with the intent of converting (or re-converting) a prospect to a Sales-accepted Lead (SAL).

Real lead nurturing answers the question “why buy from [your organization] now?” This process is very distinct from our List2Lead Nurturing in that we have shifted from general, high-level advantages to more specific differentiating factors that spell out your competitive advantages to the buyer. The differences between these two conversations are dramatic, especially when we consider measurement! Yes, measurement.

What should we measure? How should we measure? We will take a look at how our change in process affects the quality of our measurement in the next edition of {Demand Gen Brief}.

© 2011, Stephen D. Turley. All rights reserved.

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i. Principles of Ethical Influence – A Pocket Guide by Dr. Robert Cialdini (2008). For more information, visit www.influenceatwork.com.