In brief: This is the first of three blog entries about marketing videos.
In this post, we show you what it takes to create a successful video.
Careful preparation is the first and biggest step.

Keep reading to see a full post and how you can implement these tips for your next video.

Almost five billion videos are watched every single day on YouTube alone.

Another interesting fact about video marketing ROI (return on investment) is that 92 percent of mobile video consumers share content with others.

We are convinced that good preparation is half the job. Conversely, a lot of time and money will be lost if we realise during production or – even worse during post-production – that our project was not thought through properly…

That is why we made this series of twelve questions with tips, tricks and examples you should know before you dive head-first into shooting.

Below are four questions that need to be answered carefully during the preparation phase. Please address these issues before you do the video shoot (click to get straight to the answer):

  1. 1. Why a video?
  2. 2. Who is our target audience?
  3. 3. What is our goal?
  4. 4. What will the content be?
  5. 5. What is your opinion?

For more information, read the following articles:

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Video marketing: 4 tips for relevant content (you are here)
Video marketing: 4 tips to avoid trouble
Video marketing: 4 secrets experts won’t share

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Read this blog entry in German here.

To stay tuned and get the latest updates on successful video marketing, sign up for our newsletter here.

1. Why a video?

Making a movie or simple video is easier said than done. Why not a white paper, blog post or press release, instead?

First and foremost, we need to clarify our intentions. Otherwise we will get lost during the process of shooting the video. This helps bring everything into focus.

For example, why should we make a video instead of, or in combination with, a blog entry?

Of course, a video will be more easily remembered, and over all, people love to watch videos on the internet, even more so than reading a blog entry. A video might be easier to understand as well, because it generally demands a lower level of concentration than text.

In particular, we have to think about what we want to show. If we provide our costumers with audio-visual material, we need to give them something particular to see.

For instance, if we are going to talk about a lot of information, our audience be better off with text. An interested user is able to read through important sections of a text again and again. He or she doesn’t have to search for the very second where the important part begins. In a text, there are headlines that structure the information so that one can easily find a sentence or word again.

Then again, there might be a very complex issue that requires a more precise explanation. Why not make a video about this very matter to accompany the text? In the video, we explain the issue and visualise it with an exemplary demonstration.

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Tip 1

Making a marketing video just for the sake of having some video might not be beneficial, but it is always useful to have a short video a blog entry to supplement a text with visual content.[/su_note]

2. Who is our target audience?

Who are we trying to reach with this content? Existing customers, key accounts, or employees? Or are we trying to get new audiences on board, and reach even more people?

Does our target audience consist of pupils and those looking for a job or training, or of companies that could become affiliates? Or do we want to get closer to the end-user?

Children? Artists? Sportsmen? Dog lovers? You know what I mean…

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Tip 2

It is helpful to look for the kind of videos your target audience is watching, but keep in mind, your audience might be interested in completely different videos when it comes to your business.[/su_note]

Most adolescents love to watch vines (7-sec-videos) by their favorite YouTube star, but if you want to air those, the situation gets more complex. If we want to produce a video that will go viral, we had best also include an influencer (note the irony).

This inauthentic video might deter the student. She wants to be taken seriously by her future employer, who has to show they understand her situation, probably characterised by her uncertain future.

In this case, we had best focus on our qualities as trainer and an employer that provides our trainees with security, learning support, and other important qualities.

We made a video (in German, see below) about Hadya Khalil from Syria.

This DrKPI production shows what it takes to make an authentic video. Hadya herself is not an influencer, but she is authentic in speaking about her personal situation. As a refugee, she was looking for an apprenticeship in Switzerland. After a lot of hard work, which she talks about in the video, she secured a position.

For Hadya, Alpiq InTec in Zurich is the best employer / trainer she can imagine. That comes across as authentic and truthful, based on her experience.

https://www.youtube.com/watch?v=NlX6mSkY2n8

Obviously the video’s tone (factual, emotional, etc.) arises from the objective, which was to reach a younger target audience.

Understanding your target audience’s preferences, needs and wishes is a first important step. As we show below, defining what you intend to accomplish comes next.

3. What is our goal?

The next step is to ask:

Do we want to produce an image video, to illustrate our corporate culture or philosophy?
Do we need to increase awareness for our newly launched product?
Do we want to increase the number of qualified and motivated job applicants for certain positions?

In some cases, the company may just want to document the annual shareholder meeting to communicate with an important group of stakeholders.

We must write down and discuss our objective or what we want to accomplish. Without this, it is difficult to stay focused when shooting the video. Moreover, this makes assessing whether you accomplished the goals you set feasible, such as with the help of Key Performance Indicators (KPIs).

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Tip 3

It is helpful to watch others’ videos with a similar objective to help you formulate your goal and decide what can be accomplished. [/su_note]

Of course, if you have the budget, getting advice and support from professionals is always helpful, but remember that, while creativity can be wonderful, keeping your goal at the forefront is key to getting your message across.

4. What will the content be?

Obviously, a marketing video about a toy train cannot be compared to one about an innovative accessory to an endoscope.

That is what determines the video’s tone. If a CEO of a medical company is talking about the technological advancement of a new product, the video has to be neutral and fact-based. This goes beyond just the product, the firm’s strategy or an event. It is about communicating what needs to be communicated well. This can easily go wrong, whether you keep your target audience in or not.

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Tip 4

Tell a story. That goes not only for better blogging, but for videos – maybe even twice as much.[/su_note]

We often want to tell a story (see Hadya Khalil above), but sometimes we only want to give important information. Either way, we need to specify what is to be communicated.

A script has to be prepared beforehand, which must be structured properly. Without structure, you risk your audience losing the thread of what you are trying to communicate, in which case they will not watch your video to the end.

Do you want to share your views? Have these tips helped you so far? Leave a comment below or read the second part (coming soon) to get more important information on how to make a professional marketing video.

5. What is your opinion?

  • How much time do you think you spend each day watching video content on your smartphone, tablet, or laptop?
  • Do you have an example of a great video for a product, event, or explaining algebra?
  • What would you advise someone wanting to make a great video? Please share in the comments.

I hope you enjoyed your summer vacation. I thought I would share some experiences from my recent travels, which were both business and pleasure.

I definitely learned a few things about what it takes to accomplish superior service in a variety of travel-related businesses. More than once I asked myself: Is great service in tourism a dying concept?

Before we start, what makes a tourist destination attractive for you? Is it, for instance:

  • the hotel,
  • the food,
  • the in-flight service,
  • the spotless public toilets, or
  • something else?

Please let me know in a comment what makes your vacation special every time. I have had numerous experiences that made me very happy:

  1. Park Rangers: Exemplary tourist ambassadors at National and Provincial/State Parks in Canada and the US
  2. Store clerks: Going out of their way to help a confused tourist get the right product at the best price.
  3. Infrastructure: Second to none, i.e. clean and spacious, as well as free.

If you want to learn more about the best social media marketing strategy for a tourist destination, Iceland is a good example. Earned media aplenty, while word of mouth and influencer marketing all do their thing to increase the country’s popularity. Icelandair’s stopover program helps increase traffic and the ROI (return on investment) for tourist attractions.

All is well, right… but how do these things work on the ground?

1. Fake news = BAD

One thing that is bothering me is how airlines seem to try to make themselves look better than they actually are. On our check-in in Edmonton, Alberta, the sign showed that our plane had left punctually as scheduled. Just one small hitch – boarding had not yet even started.

Incidentally, when you check in online, why is it that some airlines, like Icelandair in Zurich, cannot manage to have a “baggage drop off only” lane. Instead they make you queue with all those who have done nothing online… I felt like an idiot for having done this work myself, what for?

A few weeks later on the way back to Europe, the sign in Keflavik showed the flight was boarding, but it took another 30 minutes before the process even started. Of course, no information was provided on what caused these delays; I’m pretty sure every customer felt unappreciated, like I did.

Then again, we’re just customers… why should the company care?

The plane has already left... NOT - since boarding has not even started...

The plane has already left… NOT – since boarding has not even started…

From what I could see, KLM / Air France’s check-in for a flight to Amsterdam was done better. One good indicator was that they kept customers informed about what was happening. Although, I did wonder why a Dutch/French airline fails to announce things in Dutch, especially since more than half of the flight’s passengers spoke Dutch. There were French announcements, but not one passenger I saw appeared to be a French speaker…

Fact 1. The minutes of delay in European air traffic is projected to rise 53 percent in 2018 compared to 2017. For airlines faking timeliness, this means things will get much worse before they get better.
But while delays due to strikes by French air traffic controllers in 2018 are outside an airline’s sphere of influence, keeping one’s customers informed about delays with regular announcements is basic professional courtesy.

2. A little courtesy goes a long way

During our trip I discovered a few differences regarding politeness and efficiency of store clerks, such as:

  • Netto (IS): Cashiers chew gum, don’t say hello, and when you need a refund because you got overcharged, you are in for a surprise. Not even the supervisor can do the math correctly with their smartphone – and starts serving other customers in the middle of the transaction…
  • Coop, Migros (CH): Cashiers say hello, smile, and they are all courteous.
    At my neighborhood store, I was even asked how my vacation was when I shopped there after I got back.
  • Real Canadian Superstore, No Frills, Walmart, etc. (CA): The cashier says hello, asks how you are… and is helpful (sometimes almost too much politeness for us visitors).

While being polite is not enough on its own, it is a great start to making my travels enjoyable or my store experience less frustrating.

Another thing I learned is that in Canada, everybody is helpful. In other words, park rangers, staff and so forth all try their best to make your journey enjoyable.

In Iceland one often had the feeling the person got up on the wrong side of the bed. The result was ill-tempered people doing the absolute minimum, while trying hard not to be too grumpy.

When we picked up our car at Blue Car Rental in Keflavik #bigfail, I was surprised how badly things were organised. You took a number to get service. Some workers at the counter were sitting, and seemed to be idly chatting in front of their computers. “Working,” they called it when I asked with a smile if they could help. In turn, we waited 30 minutes to get our car. Incidentally, this seems to happen every morning in the same time window of about two hours, due to many arrivals from North America.

Think it gets better when dropping off our car? Think again. They could have helped everyone by staffing three more stations to serve clients faster. Instead,  they chose to stay in the background, sipping their coffees and talking to each other… as we could see. I am sure it was a meeting and important, but can it not wait until after the (relatively short) rush?

All this can be done even if your facilities appear less slick and more down to earth. And, if it’s done with a smile during both pick-up and drop-off, as at Budget on 151 Street in Edmonton, your organization wins big with this customer. Even a less-than-perfectly-clean car (e.g., we found a toddler’s shoe under the front passenger seat) does nothing to change my level of satisfaction with your service. But in the case of Blue Car Rental #bigfail, it is just another indicator that things do not work properly. Being friendly makes my experience as a customer that much more enjoyable.

Fact 2. Smile! You could be a tourist attraction.
Blue Car Rental in Keflavik #bigfail — fails the test. Its claim is, “We offer quality service.” Really? Then, PROVE IT!
As hard as I tried, all I experienced was grumpy employees doing little more than the absolute minimum required, and managers that utterly failed at management. What a pain.

3. I have enough friends – honest

The Reynolds Alberta Museum is among many locations and sites we visited that invite you to get social. Everybody is asked to write a comment on TripAdvisor, a museum’s webpage, its blog or maybe their Facebook page.

I’M ON VACATIOOOOON! (see Billy Crystal in the movie City Slickers). I’m busy, and enjoying my privacy – 5 seconds of fame on Instagram is not on the schedule. Thus sharing my experience at your location with the world is not on my list of holiday must-dos.

Everybody wants to 'get social'. Here's an idea: instead of asking me for another useless Like, how about just enjoying my visit and actually being social with me in person as you provide excellent service?

Everybody wants to ‘get social’. Here’s an idea: instead of asking me for another useless Like, how about just enjoying my visit and actually being social with me in person as you provide excellent service?

In fact, I am not sure if the Reynolds Alberta Museum staff at the cash register really want me to tell people how unwelcome I felt… Telling people at 16:15 that the museum closes at 17:00 is one thing (thanks to our annual provincial pass, we did not pay to get in…). But closing the gift shop for the final count at 16:45 in order to leave right at 17:00 is a step too far. I guess you didn’t want my money.

Thank goodness the volunteer giving us a ride in a vintage convertible still took us around at 16:58. This and the great collection of old cars and motorcycles cancelled out the paid staff’s lack of motivation and courtesy to paying customers.

Fact 3. As most metrics regarding earned media and word of mouth or influencer marketing suggest, anyone can buy Likes and online traffic.
Asking for Likes or evaluations on all sorts of platforms is now so prevalent that it is a nuisance for customers, and it’s arguably not even that valuable in the real world.
Giving your best, one customer at a time, will result in the word-of-mouth marketing you desire. I PROMISE.

But our little apartment at Hofgarðar 5 170 Seltjarnarnes (Reykjavik) (booked via Booking.com) was superb (see Google Street View).

4. Knowledgeable people are invaluable

þingvellir (Thingvellir) National Park is surely a very important UNESCO World Heritage Site in Iceland. I got great info at the information desk from a park ranger. But while in the park itself, walking and hiking, there were no rangers to be seen anywhere.

þingvellir National Park: Great info at the information desk, but not while walking and hiking in the park.

þingvellir National Park: Great info at the information desk, but not while walking and hiking in the park.

Quite different was our experience after booking and paying for a guided tour with a park ranger at Writing-on-Stone Provincial Park. That person clearly loves her job, and knows plenty about the subject (see below).

Our guide was a cheerful, amusing person that loved to share her insights and engaged us, while using a nice dose of charm as she forced us to use our brain cells.

Being very knowledgeable AND good humoured makes the tour a pleasure for customers or visitors.

Being very knowledgeable AND good humoured makes the tour a pleasure for customers or visitors.

Fact 4. Having the resources to employ knowledgeable people that are proud of what they do is a must.
The pay-off with customers will make it well worth the expense for any park or museum.

5. Scaleable facilities are a good thing

International travel is a time-tested way for newly minted middle classes to enjoy their wealth. Popular tourist destination such as

  • Iceland,
  • Banff and Jasper (Canada),
  • London (UK), and
  • Zurich, Titlis, Interlaken, etc. (Switzerland),

will have to cope with rapidly growing numbers of visitors. Unless carefully anticipated and planned for, this growth can put a strain on a facility’s bathrooms, gift shops, and cafeterias.

With limited resources, including space (e.g. museum downtown), it is not easy to cope with the ever increasing visitor numbers. Facilities need to be expanded and that requires not only space, but also money.

Parks Canada tries to achieve this by charging visitors, and in turn, providing facilities that appear to me to be second to none.

Having to search far and wide for a bathroom is a pain. In North America, this is rarely a problem, even in national parks.

Having to search far and wide for a bathroom is a pain. In North America, this is rarely a problem, even in national parks.

Fact 5. Only 4 percent of Chinese citizens have a passport, but demand is rising. Moreover, Boeing estimates Chinese airlines will need to hire 110,000 pilots between now and 2035 to handle expected growth.

By the way, Airbus estimates that 550,000 new pilots are needed worldwide within the next 20 years.
According to the International Society of Women Pilots, only 6.7 percent of pilots are female. Clearly, we need many more women to deal with this phenomenal growth, in large part driven by rapidly rising demand for pleasure travel.

It is obvious that these trends mean more visitors for most tourist attractions. Without some investment, the result will be dismal experiences for visitors and bad press for those destinations.

Plenty of parking, toilets and picnic tables is appreciated.

Plenty of parking, toilets and picnic tables is appreciated.

6. Charging to run a smooth operation

Tourists expect great service and facilities that can manage the onslaught of the masses. Moreover, helpful park rangers and knowledgeable people are expected.

But who will pay for all these things? In Iceland, visiting such sites is free. That is appreciated, but in turn, there is apparently not enough money to have support staff or public facilities that meet high quality standards.

Head-Smashed-In Buffalo Jump – another UNESCO World Heritage Site – is an example where tourists and locals alike pay to get in. The result is a great facility that offers much more than just a classic museum experience (see below).

UNESCO World Heritage Site Head-Smashed-In Buffalo Jump: History and cultural background aplenty as native dancers perform to a running commentary that explains to naive tourists why things are done a certain way... great!

UNESCO World Heritage Site Head-Smashed-In Buffalo Jump: History and cultural background aplenty as native dancers perform to a running commentary that explains to naive tourists why things are done a certain way… great!

Of course, one has to find ways to make these sites affordable for tourists and locals alike, besides school classes that don’t have to pay and get great “experience tours” with the help of park or museum staff.

Don’t misunderstand, Iceland is doing great, but to handle these masses of tourists, it needs to charge reasonable fees. No politician can expect his electorate to be happy to pay for tourists in order for them to enjoy beautiful scenery for free.

But charging people an arm and a leg for entering the privately operated Blue Lagoon near Reykjavik is not the right way to go. While tourists may be willing to cough up this exorbitant fee (about US$ 100 per person) in order to enjoy an experience that costs a fraction elsewhere in a public facility, most locals will never visit the venue. It cannot be considered okay that things are so expensive to exclude locals altogether – can it?

One viable option is to offer an annual pass, such as the one from Parks Canada or the province of Alberta (Experience Alberta History). These are just two examples that work. They are high enough in price to channel some real cash into these operations. For locals they are great as well, because they make visiting the sites highly affordable (i.e. unlimited access for a year).

Fact 6. The public purse has limited resources.
Charging tourists to access parks, historical sites and museums is a no-brainer.
These revenues cover some, if not most, of the costs incurred running these beautiful places. Most importantly, facilities can be upgraded based on visitor numbers. Satisfied customers do wonders for your reputation – also known as word-of-mouth marketing these days.

Conclusion: What is your opinion?

Increasingly, destinations are succeeding with social media marketing strategies, but as most metrics suggest, anyone can buy Likes and traffic (such as with our DrKPI.com tools). Is this really the best measure of the value of what is on offer for tourists? Somehow, the destinations seem to think so.

Maybe it’s Canada’s, Iceland’s or Calgary’s relationship with the lakes, mountains, and rivers that creates a particularly enviable summer scene for tourists to see. Or could it be the locals that make the visit more or less enjoyable?

The tourism industry offers plenty of jobs, but working conditions, such as working nights and / or weekends, and short-term contracts for high season only, mean this kind of work is not most youngsters’ first choice. Low pay and little to no fringe benefits further dampen the attractiveness of working in tourism. Could it be that this is why I see shops, restaurants, and services shutting down because operators can no longer find the necessary talent and skills?

The result is sometimes people who are neither happy with their work nor proud of what they do. Little surprise that this negatively affects performance. And while staff working for Icelandair, Ryanair or Delta Airlines may love their jobs, this does not mean their service levels give paying customers that impression.

Brewster, the US company providing services in Jasper and Banff (also Iceland) fills its vacancies with plenty of foreigners. In Canada, these seem to be mostly Australians with seasonal work permits, for many the best way to get into the country and work. So we had fun experiencing down under slang and humour wherever we went. Not a very local experience, though.

The work is so attractive that Canadians shun it... giving Australians and others a chance to get a Canadian work permit.

The work is so attractive that Canadians shun it… giving Australians and others a chance to get a Canadian work permit.

Moreover, having the driver (and everywhere else it seems as well) ask us to leave a great evaluation on TripAdvisor, Booking.com and so forth is getting on my nerves.

Leaving a thoughtful evaluation for each and every venue is time-consuming. I want to enjoy my vacation. Hence, stop asking me to work and evaluate your service, unless you are willing to face positive and less positive feedback with a smile, please.

Social media, earned media and influencer marketing tells us many things about the next vacation spot we intend to visit. Nevertheless, can you:

  • Give an example of your last business or pleasure trip during which you got very good service?
  • What annoys you the most when you go on a holiday?
  • Any tips you can share on how I and my readers can make our next vacation even more enjoyable?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. I neither got a freebie from any of the mentioned companies nor are they our clients to the best of my knowledge).

Fotos: Urs E. Gattiker

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Developing an expert system: Much work, many challenges, challenging job. | Copyright iStock 912613902

Artificial Intelligence (AI) is and has been on people’s minds for a long time. Advertising agencies and marketing experts talk about:

  • What does Artificial Intelligence mean for marketing agencies?
  • How Artificial Intelligence Is Revolutionizing the Digital Marketing…

Such titles promise much more than most of the blog or webpage entries deliver.

One of the criticisms of AI is that such systems are unable to ace an eighth-grade science exam. The main reason being that current AI systems:

“…[cannot go] beyond surface text to a deeper understanding of the meaning underlying each question, then use reasoning to find the appropriate answer.” (p. 63)

Schoenick, Carissa, Clark, Peter, Tafjord, Oyvind, Turney, Peter, and Etzioni, Oren. (September 2017). Moving beyond the Turing Test with the Allen AI Science Challenge. Commun. ACM 60(9), p. 60-64. DOI: https://doi.org/10.1145/3122814
Check out the video at the bottom of this post !

Read the rest of this blog entry to:

  • define what an expert system is;
  • show why Pinterest’s updates are based on an imperfect AI system;
  • illustrate the challenges of using AI to augment marketing;
  • watch an interesting video about AI and learning science further below; and
  • ask you for your feedback, input and opinions – join the discussion.

This entry is part of our series of posts on AI. To stay tuned and get the latest updates, including on AI and marketing, sign up for our newsletter.

This project is part of our White Paper project for the Competence Circle Technology, Innovation and Management #ccTIM from the German Marketing Association (Deutscher Marketing Verband).

This post continues our discussion entitled, What is marketing automation?

1. Definition of an expert system

In the 1980s, we were all interested in Decision Support System(s) (DSS) and expert systems. The use of AI garnered a lot of interest from the business press.

Using AI became easier, at least in theory, thanks to the rapidly decreasing costs of calculating or doing the arithmetic for ever larger data sets. This made it feasible to use many mathematical operations to gain insights into user and customer behaviour.

At the same time, AI systems represented the risk of amplifying implicit bias contained in the data sets they were trained on. In turn, some systems can make wrongful inferences or judgments about users. Below we attempt to define what an expert system is.

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An expert system uses specialised knowledge and expertise from a human expert in a particular problem area and converts it into software code. With the help of such code, the expert system can emulate the decision-making ability of a human expert. It allows the system to perform at a level of competence that is better than that of non-expert humans.

Expert systems are part of a general category of computer applications known as artificial intelligence.
Expert systems can be used to diagnose patients, to put together a system that identifies fake news, and so on. Difficulties can arise when interpreting results produced by “black box” systems whose workings are often hard to analyse.

Edward Feigenbaum is seen as the father of expert systems.

See also definition by Encyclopaedia Britannica.[/su_box]

Of course, in cases where decisions can be clearly defined with one or even many algorithms (i.e. mathematical operations), we expect expert systems, and thus computers, to take over most of the tasks currently done by humans.

For an expert system to work well, two things are paramount:

  1. its rules and algorithms need to work properly, and
  2. the rules and decisions made need to be the right ones.

Hence, expert systems are often downgraded to represent expert support systems, which support humans in making better decisions. We define expert support systems below.

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An expert support system helps people solve problems. Like an expert system it allows the system to perform at a level of competence that is better than that of non-expert humans.

For instance, with Legalos, the user of the expert support system enters relevant information. The expert support system then uses this information and generates a template, for example a contract between a company and its cloud services provider. Here, the expert support system can provide the entrepreneur with several types of standard contracts very quickly. In turn, this helps keep a company’s legal costs down.

Another simple online expert support system is provided by Germany’s Federal Ministry of Justice and Consumer Protection. The service asks the user to enter some information pertaining to data processing and privacy measures. Based on this input it then generates a transparent data privacy policy as required by Article 12 of the General Data Protection Regulation (GDPR). This can then be slightly modified to fit the company’s particular circumstances.

See also: Luconi, Fred L., Malone, Thomas, W. & Scott Morten, Michael, S. (December 1984). Expert systems and expert support systems: The next challenge for management. Boston: MIT working paper #122, Slong wp #1630-85. Retrieved 2018-06-12 from http://dspace.mit.edu/bitstream/handle/1721.1/47478/expertsystemsexp00luco.pdf

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In general, an expert system must acquire knowledge from experts. Such insights are then applied to a large set of probability-based rules to make a decision.

By contrast, an expert support system still requires the human user to weigh some of the factors and then arrive at a decision.

2. Pinterest updates – more noise

Many companies use such technology. For instance, Pinterest and Instagram use similar AI to figure out what Pins you should check out on Pinterest or which Instagramers you should follow. Twitter operates the same way, and so does Facebook (see your newsfeed) or LinkedIn (whom you should connect with).

Recently, I got just such an update (see image below), suggesting that I go and check out 18 pins I should be interested in, based on my board #MCLago.

How on earth did Pinterest's "expert system" decide that these pins are relevant to my #MCLago board?

How on earth did Pinterest’s “expert system” decide that these pins are relevant to my #MCLago board?

3. When expert systems fail to augment marketing

As you can see in the image above, whatever criteria Pinterest used to determine what pins might be of interest to me, ‘common sense’ was not programmed into this decision-making process. How it concluded that I wanted to meet single men is a mystery to me.

Why I should care about Lipitor – a prescription drug – is unclear. Yes, I do post medical stuff, but primarily about minimally-invasive endoluminal or endolumenal surgery, because of my work with Lumendi Ltd.

On the upper left in the above screenshot you can see some people in a photo. The program concluded this from one of my recent pins. I had recently posted something – with video – about a Syrian refugee (the picture shows the trainee with her co-workers and bosses). So the thought was I would like another one. Well, here a deeper understanding of the meaning underlying the item I pinned would have allowed Pinterest’s expert system to find a picture in a similar realm.

Instead, it inferred that I would be interested in “Who’s In and Who’s Out for the Next Season of Nashville“. Seems a little ridiculous.

Basically, an expert system needs to be able to do more than do simple math. Moreover, predictions are not enough to automate the decision-making process or task with the help of AI (see Agrawal, Gans & Goldfarb, Spring 2017). Below, we list the six key things an expert system must be able to handle to get AI to deliver the most value.

Agrawal, Aja, Gans, Joshua S. & Goldfarb, Avi (Spring 2017). What to expect from artificial intelligence. MIT Sloan Management Review, 58(3), pp. 23-26. Retrieved 2018-06-12 from https://sloanreview.mit.edu/x/58311

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An expert system not only executes tasks efficiently, but more importantly, gets a few things right, such as:

1. Data analysis: What kind of photos or status updates does this individual post?

2. Prediction: What action would the recipient take and / or would this potentially be of interest to the customer?

3. Judgment: Yes, this status update / photo is of interest to the user / customer.

4. Action: Include photos of interest and mail out newsletter to subscriber, user or customer.

5. Key Performance Indicator (KPI): The recipient has clicked on several of those 18 suggested pins. This expert system did better than average.

6. Quality of service: The pins the client clicked on provided content that represents added value for this user.

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Unless the expert system we use can do the above, marketing activities are more likely hampered than augmented.

4. Ultimate test: Does this content answer the question I am asking?

As pointed out above, whether the user clicked on several suggested pins is one possible KPI. For instance, I clicked on more pins than could be expected. Nevertheless, ultimately it is not the clicks on pins recommended to me by Pinterest that matter. Instead, the ultimate criteria for a user is whether those pins provide information that represents added value.

In my case, that did not apply. To illustrate, I checked out the pin about 10 KPIs in marketing, which brought me to a blog entry (see image below).

When an expert system cannot deliver quality: Pinterest recommends pins that mean little or nothing to me.

When an expert system cannot deliver quality: Pinterest recommends pins that mean little or nothing to me.

As the above shows, somebody is spreading her opinions regarding KPIs. We all know that the life cycle of a client is important, but if you are running a start-up, this could be of lesser importance than getting new clients who can help you pay the rent.

Strategising your sales revenue approach is interesting, but not something that everybody needs to do. Treating your clients respectfully and providing a service that they feel is worth the money they paid you most certainly helps. When it comes to revenues, that applies regardless if you track it with a spreadsheet or do it on a piece of paper.

5. What is your opinion?

The verdict is simple. The expert system that Pinterest uses to serve me weekly or more with an email of suggested pins does not do a good job. The recommendations it makes indicate that the AI system lacks a deeper understanding of the meaning underlying each pin I uploaded. In turn, it cannot source pins that might interest me.

But do not be fooled, neither Twitter nor Instagram do better with these things. Developing a well-functioning expert system takes a lot of work and testing.

However, the fact that expert systems do make errors was already pointed out by researchers in the 1990s:

Williams, Joseph (1990). When expert systems are wrong. In Proceedings of the 1990 ACM SIGBDP conference on Trends and directions in expert systems (SIGBDP ’90), p 661-690. DOI: https://doi.org/10.1145/97709.97761

On reviewing the challenges and benefits of expert systems and neural networks, things do not appear to have become easier in 2014, even though the benefits can be substantial (e.g., https://link.springer.com/article/10.1007/s10916-014-0110-5).

What I would love to know is what you think about these issues in 2018 (#ccTIM will continue updating you on this subject):

  • Do you think AI (artificial intelligence) will revolutionise marketing? Please explain why or why not.
  • Do you have examples of great expert systems, for instance in marketing, management or production?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. to the best of my knowledge, I got neither a freebie from any of the aforementioned companies, nor are they our clients).

Check out this video, worth watching – see quote at the beginning for reference to research paper that is source for video below.

Urs E. Gattiker and Herbert Towning having fun making movies.

In short: We thought we would give you a peek behind the scenes as we create a marketing video with one of our major clients.

Videos are becoming increasingly important as a method for communicating with your target audience. But it is not an easy process.

Just click on the hyperlinked points below to read more.

  1. Does making a video make sense?
  2. Clickaholics versus engagement artists
  3. Is it worth the effort?
  4. What is your opinion?

CEOs are busy people and usually have other things to do create a video. It also requires no distractions – easier said than done. No matter what, an interruption will happen, and you just need to deal with it.

Demonstrating the latest version of the LomMedical syringe.

Demonstrating the latest version of the LomMedical syringe.

1. Does making a video make sense?

Recently, we published 2018 marketing trends: Sharing economy grows, in which we pointed out that videos are popular, but this may differ a bit according to consumer group:

  1. The ShaRenter generation (born 1999-2018, 0-19 years old in 2018) prefers renting over owning things (e.g., streaming with Spotify or watching videos via Netflix or YouTube) or even renting the necessary textbooks for college online (e.g., Cengage Learning for US $119.99 per semester).
  2. Millennials (born 1981-1998) are 20 – 37 years old in 2018.
  3. Gen Xers (born 1965-1980) are 38 – 53 years old in 2018.
  4. Baby Boomers (born 1946-1964) are 54 – 73 years old in 2018.
  5. The Silent Generation (born 1928-1945) are 74 – 90 years old in 2018.
Thumbnail for LomMedical retractable safety syringe.

Thumbnail for LomMedical retractable safety syringe.

Obviously, the ShaRenter and Millennial generations will love watching a video. They already stream their music, rent their favourite videos and have cut the cord to their cable company (i.e. they instead watch something like Netflix). They may also no longer have a fixed line telephone, but instead use their mobile phone.

But what about Gen Xers?

Changing the script, re-shooting a video sequence.

Changing the script, re-shooting a video sequence.

And what about the Baby Boomers, who are even older?

Will they watch a video? Sure, if it provides them with information that they care about.

We believe that as long as your video conveys important information to your target audience such as employees, customers and investors, it is worth the CEO’s time.

We always try to have a laugh or two while shooting a video.

We always try to have a laugh or two while shooting a video.

2. Clickaholics versus engagement artists

Of course, since CEOs are busy people, they will want to know if it is worth their valuable time. As we all know, shooting a video takes quite a while and many retakes may be needed to get it right.

Of course, getting many eyeballs on your video could be one objective; everybody likes lots of views. However, while having many watch is desirable, the watchers need to represent one’s target audience. So if the video focuses on clients, we want them to watch.

In LomMedical’s case, the video is informational and its target audience is the company’s shareholders. In turn, if 70 percent of shareholders – about 500 people – watch the video, everything is peachy. However, if 200 of those are kids who thought the video would show them a new jingle, they will be disenchanted and click away after 15 seconds.

More views is of course wonderful, but they need to be from members of the audience we want to reach.

Here is the video (about 1 minute) that Patrizia made of our shoot.

The sequences in the clip above illustrate that we worked hard. Fortunately, we had a few good laughs with each other as well. The video has already garnered a few views and shareholders have provided positive feedback on the company blog.

Such engagement in the forms of viewer comments is, of course, very desirable. It shows that the content in the video represents added value for shareholders, LomMedical’s primary target audience for this endeavour.

3. Is it worth the effort?

Making a video is neither cheap as far as the CEO’s time is concerned, nor is the required equipment. The script also needs to be written and the shoot needs to be directed. Moreover, in addition to the camera expert, somebody needs to cut the video and edit it.

Some people do it all themselves, such as Swami Kumaresan, CEO at Databox. But such efforts do not come without cost. I know – I have tried in the past.

First I used screen capture software, then a camera with a tripod. Finally, I contacted our design editor and she did the best she could with my work.

These days, things are different. We have put together a professional team that knows what to do.

Urs E. Gattiker and Herbert Towning having fun making movies.

Urs E. Gattiker and Herbert Towning having fun making movies.

It is worth it… as the video – see below – shows.

4. What is your opinion

CEOs are busy people and usually have bigger fish to fry than taking more than half a day to shoot a video. Worse, the process requires 100 percent of his or her attention.

So, no text messaging, WhatsApp, phone calls, etc. That is not easy for most CEOs… Neither can people access the CEO in the room, though that can happen inadvertently. In our case we asked him to take a few pictures – which he did.

Regardless, interruptions will happen. Somebody rings, or wants two minutes of the CEO’s time while you are trying to finally get this video sequence right… nerve-wracking.

But what do you think?

  • Do you know of a great CEO video that you want us to watch? Please leave a URL in the comments below!
  • Do you manage to keep your CEO on-script, or…
  • How do you decide the video gets your message across?

The author declares that some of the companies mentioned herein are clients of CyTRAP Labs or subscribers of DrKPI® services.

Below you can watch the complete and final version of the video we released on the LomMedical webpage.

Trends and forecasts: Marketing strategy and metrics.

In short: I have not published new content for a while, but I thought this was a great opportunity to wish our readers a Happy New Year and all the best for 2018.

In 2018, the “ShaRenter” Generation (under 20) is challenging retailers to respond to their increasing desire to rent instead of owning product (e.g., clothes, cars, music, textbooks).

The digital age is continuing to disrupt how car brands offer product. For instance, Volvo, Cadillac, and Porsche now offer subscription models.

We address these trends in some detail and outline the challenges.

Just click on the hyperlinked points below to read more.

1. Subscription-based model for renting goods

In 1999, at the end of EICAR’s annual conference in Brussels, a Symantec employee gave me an anti-virus software CD. It was a left over sample and he suggested I give it to one of my students to use. It included the program to install the software on a PC and a one-year subscription to receive free updates. The latter was critical, of course, since virus signatures needed updating to protect against new threats. But in this context, it signalled a growing trend for subscription-based services in the software business.

These days, security software vendors only use online subscription-based revenue models. Microsoft has even switched to this approach for home users buying Microsoft Office. Dating apps like Tinder use this approach as well, offering users a Tinker Gold subscription for about US $14.99 per month. Car brands like Cadillac, General Motors’ luxury brand, offers a subscription-based model at US $1,800 a month for Cadilac’s Book service in New York. This will soon be available in Europe as well.

The advantage of such subscription-based models is that they offer a stable source of income. Definitely more advantageous for Tinder than depending solely on online advertising.

100 years, later DeStijl painter/designer Piet Mondrian is still inspiring fashion in 2017 and beyond.

100 years, later DeStijl painter/designer Piet Mondrian is still inspiring fashion in 2017 and beyond.

2. ShaRenters Generation: 2-click test

Regardless of what we want to accomplish, the website has to get users what they need quickly. If I cannot find things within two clicks, I will leave a site and go someplace else.

This is becoming increasingly important as mobile internet spreads and users use their smartphones. Keep in mind, different groups of consumers have different demands, but you need to target smartly to get what you want.

  1. The ShaRenter generation (born 1999-2018, 0-19 years old in 2018) prefers renting over owning things (e.g., streaming with Spotify or watching videos via Netflix or YouTube) or even renting the necessary textbooks for college online (e.g., Cengage Learning for US $119.99 per semester).
  2. Millenials (born 1981-1998, 20 – 37 years old in 2018)
  3. Gen X (born 1965-1980, 38 – 53 years old in 2018)
  4. Baby Boomers (1946-1964, 54 – 73 years old in 2018)
  5. The Silent Generation (1928-1945, 74 – 90 years old in 2018)

Some claim (e.g., FT.com 2017-12-23/24, p. 14) that the rental business started 15 years ago, however this is simply incorrect. Software vendors such as Symantec saw the writing on the wall years ago. Even back in 1998, a subscription-based model provided a more consistent revenue stream.

Companies like Adobe soon followed; most of its software is exclusively offered in software bundles. Most include software we do not need, but must pay for anyway. Remember cable TV? One reason why people cut the cord is that every package had a lot of content households did not want. In other words, selecting your preferred choice of channels for a personalised package that suited your individual needs was not an option.

How much things have changed over the last ten years is remarkable. Streaming has transformed the music and TV business. People choose what they want to listen to or watch, at what time and where. CDs or DVDs look antiquated in this market where people pay to get access to such content as long as they subscribe to Google Music, Amazon or Spotify. That forces music artists, film studios and so forth to adjust, and offer more merchandising for instance, as well as performing live gigs to pay the rent.

The shift from owning to sharing a car has forced General Motors, Ford, Volvo, and others to adapt. For instance, in the past a car manufacturer built the car and sold it via a dealership or an online vendor. These days, car manufacturers also have to take ownership of the cars under subscription schemes. Hence, they have to account for maintenance costs and depreciation.

One thing is clear, the ShaRenters are an impatient lot. Unless information is found within two clicks, they will not continue to hang around. In turn, usability of a website, user-friendliness and usefulness of the information provided are ever more important. I want to get what I need pronto.

This applies to recruiting as well, where most companies fail the two-click test – though there are a few that excel (see Alpiq InTec below).

School pupils aged 13-17 try to find the best place to apply for their apprenticeship. The ShaRenter generation expects two clicks get them where they need to be (e.g., how to apply, what are the benefits, etc.).

School pupils aged 13-17 try to find the best place to apply for their apprenticeship. The ShaRenter generation expects two clicks get them where they need to be (e.g., how to apply, what are the benefits, etc.).

3. Amazon, Facebook, Google, Booking.com, Airbnb: The antitrust paradox

Kahn has pointed out that American antitrust law has evolved to the point that it appears to no longer be equipped to deal with tech giants such as Amazon.com, Apple, and Uber.

Why? Glad you asked. The reason is that once a supplier gets too dominant in the marketplace, it becomes nearly impossible for a competitor to succeed. In other words, winner takes all.

US regulation focuses on price and selection. Hence, if Amazon assures a wide selection of products at competitive prices, all is good for the regulator (oversimplified, of course). One example is when Amazon manages to squeeze up to a 70 percent price reduction from UPS for parcel shipping.

It still earns money by charging its clients a bit more than it pays. Even better is that smaller suppliers still pay less by selling and shipping via Amazon than directly. The reason being that they can never get the same deal with UPS that Amazon does with its purchasing power.

All is well, right? Not so fast. Things are already problematic when you have little choice but to sell via Amazon. Amazon is a great place to sell, but only if you fit their model and are willing to submit to their rules.

Whenever things are slightly not according to their preconceived model, they get tough and bureaucratic. Tikiwe® tried and it took nearly all of a half-time employee’s hours to jump through all the hoops to get to get their products listed. Bureaucratic and not responsive, I would dare to call Amazon. Whenever one tries to get a service or response out of the company, i.e. one does not fit the model for which Amazon has an institutionalised response (e.g., getting a refund), it gets difficult and service quality drops instantly… because service is not scalable.

Lack of viable alternatives makes the splitting of Amazon an issue (Kahn, 2017-01, see link below). European regulators want to get a minimum of three competitors in a market. The telecommunications market nicely illustrates how this works. In other words, more price and service competition guarantees consumers a better deal (see Lynch, 2017-10-31).

If any platform such as Airbnb or Uber has too much market-share, you look for competition. That Lyft increased its US-market share from the mid-teens to 20-33 percent. Of course, this depends on which metric you use or statistic you believe. Nevertheless, this is good for consumers of such car-hailing services.

Kahn, Lina M. (2017-01). Amazon’s antitrust paradox. The Yale Law Journal, 126(3). Retrieved 2017-10-30 from https://www.yalelawjournal.org/note/amazons-antitrust-paradox

Lynch, David, J. FT Big Read. Big Tech and Amazon: too powerful to break up. Financial Times, p. 9. Retrieved 2017-11-04 from https://www.ft.com/content/e5bf87b4-b3e5-11e7-aa26-bb002965bce8

  • Who will get most attention from regulators?
  • Who will get most #BrandBuzz?
    CLICK for more info: Gattiker, Urs E. (2013). Social Media Audit: Measuring for Impact – ISBN 978-1-4614-3602-7

4. What is your opinion

We have pointed out three trends here:

1 – Renting and sharing of goods is becoming more popular in more markets, including clothing and children’s wear;
2 – The ShaRenting Generation is less interested in ownership of a product than just getting access everywhere, whenever they want it; and
3 – The Amazon Paradox whereby market dominance by Facebook, Airbnb or Booking.com is becoming an issue for market regulators on both sides of the Atlantic.

But what do you think?

  • What product did you buy 5 years ago, but rent these days (think music, video, Airbnb, etc.)?
  • Do you believe that Amazon is too big for its own good?
  • Do you book your hotels via Booking.com? Do you get a better deal that way than directly through the hotel?
  • What do you like the most in the renting / sharing economy?

The author declares that some of the companies mentioned herein are clients of CyTRAP Labs or subscribers of DrKPI® services.

Augmented marketing services can make our lives easier but automation can result in undesirable outcomes | Copyright: Death to Stock Photo, 2200

In short, is ordering your pizza online a result of the restaurant augmenting or just automating the sales process?
Structured, rule-based processes can be performed by robots.
Complex unstructured marketing processes that may result in different or unique outcomes are difficult to automate.
To illustrate, bento lunch boxes in Japan contain little portions of rice, fish, meat, pickles and other delicacies packed in plastic box. These items are extremely hard to grasp, thus automation is a challenge.
Here are the three answers marketers must answer soon to stay ahead of the pack.

♥ Curious? Join 1,500+ other subscribers to this blog’s newsletter and read on!

This article is part of our series of posts:

  • What is …. more follows soon

1. What is automation?

Doswell made a distinction in 1983 in his book “Office Automation” between tool and machine. In its basic form, a pencil is a tool. It cannot be used without the human writing or drawing with it. A typewriter is a machine that requires a human to use it, even if it is electric: a IBM Selectric typewriter.

Doswell defined a word processor as a programmable machine. The fact that it can function in part without a human working it results in automation.

In 1992, I wrote that the effective use of technology requires adjustments in an organisation’s structure, processes and workflows.

Today, we talk about automation, while we actually mean augmentation of services or tasks with the help of software code. We code certain steps or decisions that may result in algorithms that perform routine, rules-based processes. Of critical importance is that the outcome results in one single correct answer (i.e. a deterministic outcome).

But this situation often fails to apply. If I have a book’s ISBN number, I can soon tell my device at home to order this at my favorite bookseller. However, as soon as I enter an incorrect number, the outcome is no longer clear cut. For instance, the system could suggest the correct number, or else show me the name of the most likely author, title and so forth and I can decide if the book I want is listed.

Interesting readDoswell, Andrew (1983). Office automation (see p. 123). Chichester, UK: John Wiley & Sons.

Takeaway: Automation is a not a dichotomy but a continuum

Our understanding of what automation means is a constantly moving target.

In early 2016, Facebook used human editors to develop trending news lists. Some claimed these editors introduced a political bias. In turn, Facebook decided to automate this task and left the job to algorithms.

Later in the year Facebook discovered that algorithms cannot tell a real story from a hoax (i.e. fake news)… Facebook trended fake news.

2. Augmenting marketing services

The above illustrates that automating services is not easy. More often than not, only single tasks end up getting automated. Once things get complex, or several outcomes are possible, automation is very difficult to accomplish.

Automatic marketing services could fail either in unusual situations or in ways that produce unusual situations. The latter may be a tricky situation where various skillful responses may prevent a total disaster or only one specific response can, such as a pilot preventing a plane crash or a powerplant operator preventing a nuclear disaster like Fukushima or Chernobyl (see Tim Harford, 2016-10-11).

Neil Patel and Ritika Puri offer this definition of marketing automation:

[It] connects multiple touch points and marketing channels including social media, email marketing, and content marketing…
Marketing automation makes it easier to send personalized, 1:1 targeted messages. In other words, [it] makes communication stronger…
…Different marketing automation platforms are designed for different types of businesses… Act-On… comes with email, website visitor tracking, lead management, social media, CRM, reporting and analytics. A core value proposition is that business owners can execute their marketing from one place to (1) generate high quality leads and (2) transform those leads into sales…

The above definitions are all important, but they describe mechanisation of marketing processes. The results are what is called single outcome situations or deterministic outcomes.

For instance, you subscribe to a newsletter and get an opt-in email. In turn, you click on the link provided to confirm your signing up for the newsletter. This in turn triggers a thank-you note and so forth. Thereafter you are on the subscriber list and will receive the next published newsletter.

When using a chat box on a website, the operator or system may provide you with standardised replies for those questions that were previously listed in an FAQ (Frequently Asked Questions).

But instead of following these various definitions, it is better to focus on the characteristics of the marketing services that these tools are supposed to automate.

Takeaway: Augmentation still beats automation

By using machine learning we can improve industrial processes, marketing and customer experience.

Augmenting marketing processes is a far more common way to leverage technology than automation.

Interesting read: Lacity, M. C. & Willcocks, Leslie P. (Fall 2016). A new approach to automating services. MIT Sloan Management Review, Vol. 58(1), pp. 41-49. Retrieved 2017-07-31 from http://sloanreview.mit.edu/article/a-new-approach-to-automating-services/

Marketing automation at its best? "When the Going Gets Tough, the Tough Go Shopping" | Copyright: Death to Stock

Marketing automation at its best? “When the Going Gets Tough, the Tough Go Shopping” | Copyright: Death to Stock

3. The next five years in marketing automation

So where will we be five years down the road? How will automation of marketing services look?

Today, it is primarily defined using simple deterministic processes to define the term, such as:

Marketing automation involves a software platform that can be used to deliver content based on specific rules set by users.

Järvinen, Joel & Taiminen, Heini (2016). Harnessing marketing automation for B2B content marketing. Industrial Marketing Management, 54, 164-175. doi:10.1016/j.indmarman.2015.07.002. Retrieved 2017-08-08 from https://www.researchgate.net/publication/280875581_Harnessing_marketing_automation_for_B2B_content_marketing

Interesting read: National Science and Technology Council. Networking and Information Technology. Research and Development Subcommittee (October 13, 2016). The national artificial intelligence research and development strategic plan. Retrieved 2017-08-07 from https://www.nitrd.gov/PUBS/national_ai_rd_strategic_plan.pdf

This is the beginning. Algorithms in marketing may be alluring, but as Spotify’s music recommendations illustrate to us users, algorithms do not necessarily have our best interests at heart. They optimise things to enable the company to sell you more music – and so, make more money (see Brian Whitmann, former principal scientist at Spotify, December 11, 2012).

Takeaway: Manage your risk

Algorithms will get better but how much things will change nobody knows. Amazon’s two divisions – advertising and cloud-computing – have relied on self-service portals to attract new clients. New sales staff hires at these Amazon divisions in the second quarter of 2017 are the primary reason for the increase in the company’s headcount (from 351,000 to 382,400 at the start of quarter three).

Larger companies want personalised service. Their needs are too complex to be met by a self-service portal Amazon offers. The result is that staff has been hired to service large firms. When things get too complex, augmentation of services is the first step but automation is not always feasible.

[su_box title=”Marketing automation vs. marketing augmentation: 3 critical questions to be answered” box_color=”#86bac5″ title_color=”#ffffff” radius=”5″ width=”px 700″ ]

1.  Is there a single correct answer?

Yes, the customer wants to download a white paper or a checklist.

Or, the individual passes a security check and may therefore enter the secure area, etc.

2.  Can we develop a set of likely answers?

In many situations there could be more than one answer as outlined in point 1 above (the ISBN – maybe the client switched two numbers). This means the answer is a no, but what if…

For instance, based on the user’s past order history, the system knows that this could be a book addressing marketing issues. Going through the database, two options come up where everything is correct as typed in by the client, except for the two switched numbers in the ISBN.

So the system responds in some way and shows the person the two possibilities including author, summary of book and cover. The client can then say yes to one or no to both options of books as presented by the system. A ‘No’ answer could then trigger two or three more options, and so on, hopefully resulting in the person ordering one or two products.

3.  What degree of agility is required for performing / automating this marketing task?

One outcome may be a less than optimal recommendation list of possible songs on a client’s playlist.

In the case of advertising business, adding sales teams will help Amazon attract bigger clients. The latter do not appreciate the self-service currently offered; their service demands are too complex, requiring humans to consult.

As factory robotics has taught us, robots lack the agility of humans. It makes little sense to have a self-driving truck, if it needs a driver to unload the contents with a forklift on arrival.

If we have a box with 3 products, pens, pencils, fountain pens, the robot needs to distinguish between them. Until robots are able to do such work, Amazon will continue to use humans to pick up products in its warehouses. [/su_box]

Getting things organised - marketing autmentation | Copyright: Death to Stock Photo Workshop 8

Getting things organised – marketing autmentation | Copyright: Death to Stock Photo Workshop 8

4. Have your say – join the conversation

Organisations can use marketing automation to generate multiple business benefits. Cost savings, better customer experience and better quality can be the result of such work.

But where agility is needed, automation becomes a challenge. Unless we can train robots in an intuitive way, rather than program each possible step, move and outcome (if x then do A or ask for B…), marketing automation is more likely to be marketing augmentation.

[su_box title=”What is marketing automation? THE definition” box_color=”#86bac5″ title_color=”#ffffff” radius=”5″ width=”px 700″ ]

Sales focuses on the seller’s need to convert the product into cash.

Marketing focuses on satisfying the needs or solving the problems the client may have.

Content, affiliate, dialogue, permission and other marketing activities are just different parts of what marketing entails.

In turn, marketing automation tries to adjust an organisation’s structure, processes and workflows to optimise various activities such as content, affiliate, dialogue and permission marketing.

Going down memory lane, let us not forget

However, mechanising part of marketing does not mean with have done a terrific job.
Just think about direct marketing and software companies like Hubspot and the unnecessary things you receive daily in your letter mailbox or e-mail in-box.

As soon as things get complex, automation becomes tricky

In the early 1980s we talked about office automation. Today we have ever more people working at some kind of office. Even though things have been digitised we use as much paper as then to print…. and many things still need to be optimised further to reach an automation level that allows us to send staff to the beach.
We are still ways off having humanoid robots stand at our office door to take on our tasks.[/su_box]

But what do you think?

Source: What is marketing automation?

What is your opinion?

  • Do you think AI (artificial intelligence) will revolutionise marketing automation?
  • Do you have examples of great marketing automation with the possibility of multiple outcomes (probabilities)?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. I neither got a freebie from any of the mentioned companies nor are they our clients to the best of my knowledge).

Strawberries - 2 days on the shelf and these fruit will show and taste accordingly | Public Domain USDA | Photographer: Brian Prechtel

In short, Amazon bets on Whole Foods to deliver groceries and events like its Amazon Prime Day on July 11.
Walmart (the world’s number 1 retailer) bought Jetcom and now Bonobos to further reduce prices and compete with Amazon.
Carrefour (the world’s number 2 retailer) left growing markets such as Colombia or Thailand. It also seems a bit too reliant on a business model developed in the 1960s.
Aldi and Lidl just opened plenty more stores in the US, UK and elsewhere.

We discuss this a bit further and wonder, who of the three famous gladiators will win… or will it be Tesco, Lidl or Aldi?

♥ Curious? Join 1,500+ other subscribers to this blog’s newsletter and read on!

We discussed how increasingly challenging e-commerce is becoming in several previous posts:

1. Are we profitable?

Which of these companies is the most profitable? Considering the news coverage it gets, one would think the answer is Amazon. I was surprised when it set out to purchase Whole Foods, an upscale food store chain in the US, for US$13.7 billion.

Of course, analysts may feel that this could help its nascent grocery business, Amazon Prime Pantry. In other words, it might allow this online supermarket to acquire enough local brick-and-mortar points to deliver perishable and staple household goods to its clients – one of the challenges it tries to overcome with its Amazon Pantry service in Germany.

But Amazon is spending less (US$500 million) while taking on more risk in India right now for its grocery business there. Here, the biggest challenge is the heat, so a large fleet of refrigerated vans is a must. It might even buy India’s largest online grocer Big Basket, which is heavily invested in Asia and poised to move into Australia.

But in India, roughly 1 percent of total grocery sales (about US$150 million) is done online. Compare this to the UK’s 5 percent… It’s no wonder the UK is considered the most advanced online market for consumer staples.

Jeff Bezos founded Amazon in 1994. In his first letter to shareholders in 1997 he pointed out the following:

… Amazon.com passed many milestones in 1997: by year-end, we had served more than 1.5 million customers, yielding 838% revenue growth to $147.8 million, and extended our market leadership despite aggressive competitive entry.
But this is Day 1 for the Internet and, if we execute well, for Amazon.com.

Takeaway: Some CEOs’ performance is measured differently

It shows that Jeff Bezos took a risk launching Amazon. But he was also at the right place at the right time.

Similarly, the touchscreen era began 10 years ago on June 29, 2007 when Apple’s iPhone first went on sale. The iPhone’s timing was impeccable. Google Maps and YouTube use were on the rise and, most importantly, the emergence of affordable mobile data contracts happened shortly afterwards.

If we had invested US$1000 on May 15, 1997 in Amazon shares, they would be worth about US$666,000 today. But Amazon has yet to pay dividends. Understandable, considering Amazon has a US$136 billion turnover, but made just US$2.6 billion net profit last year.

Hence, my profits come from the rise in its share price – nothing more, nothing less. But my banker would probably not give me a small business loan based on such low profitability, would they?

Jeff Bezos’s success is measured on entering new markets both geographically and businesswise. Walmart’s CEO Doug McMillon’s success is measured based on profits.

Fair? Maybe, maybe not – but investors are not always rational…

So are Walmart, Carrefour, Tesco, Lidl and Aldi doomed?

Peaches - harvested ripe: After two days on the shelf, these fruit will look and taste accordingly | Public Domain USDA | Photographer: Jack Dykinga

Peaches – harvested ripe: After two days on the shelf, these fruit will look and taste accordingly | Public Domain USDA | Photographer: Jack Dykinga

2. Where is brick-and-mortar going: Doomed?

Well, considering that Credit Suisse (mentioned in FT article) estimates that 8,640 brick-and-mortar outlets in the US will close their doors this year alone, tough times are coming for Aldi, Walmart and co… Maybe.

By the way, the Credit Suisse study mentioned in the FT article cannot be found on the bank’s website. This illustrates how Credit Suisse fails to understand the digital age as far as communicating their research is concerned :-(

Brick-and-mortar businesses have tried hard to fight the onslaught of digital vendors. For instance, former Carrefour CEO Plassard restored workers’ pride in being part of the French retailer’s staff. He came in 2012 and made a lot of changes to the 12,000-outlet strong retailer doing business in 30 markets.

Unfortunately, the company still lacks a clear vision on how retail will be shaped within the next 10 to 15 years. Its challenge is that:

  • nearly half of its sales are generated in France,
  • its online reach is limited, AND
  • its hypermarkets are challenged by discounters like Leclerc and Aldi, both of which are nipping at its heels.

New CEO Alexandre Bompard is supposed to fix the problem. He was hired based on his success with Fnac Darty, France’s largest brick-and-mortar chain. He has quite successfully fought off Amazon in France:

Takeaway: Expansion can help

In 2016, e-commerce accounted for just about 1 percent of sales for Carrefour.

Walmart went a different route by pursuing deals to improve its online reach. It paid US$3.3 billion for internet retailer Jet.com in 2016, resulting in online sales increases of 63 percent in the first quarter of 2017 in the US alone. Its challenge is to integrate key elements of its e-business with Jet.com. This also goes for 10-year-old Bonobos, a digital-focused men’s apparel group that was bought for US$310 million in cash in June 2017.

Aldi’s planned US expansion from 1,600 to 2,200 stores will make it the third-largest grocery chain operator in the country behind Walmart and Kroger.

Aldi’s 2,500 stores would equal about 53 percent of Walmart’s US outlets.

But neither Aldi nor Lidl have a great web presence and apparently have no plans to change that any time soon.

  • Do they know something investors in Amazon may not?
  • Are they wrong to expand so much with brick-and-mortar instead of in the digital marketplace?
Remember Webvan, Foster City, Silicon Valley? Webvan was an online grocery business that went bankrupt in 2001 after three years of operation. Amazon Pantry is struggling in its markets... and may fail in India. Most people prefer getting perishable foods (e.g., dairy, meat, and produce) at their local store.

Remember Webvan, Foster City, Silicon Valley? Webvan was an online grocery business that went bankrupt in 2001 after three years of operation. Amazon Pantry is struggling in its markets… and may fail in India. Most people prefer getting perishable foods (e.g., dairy, meat, and produce) at their local store.

3. Who is the winner? Growth versus profit

We do not know for sure. One reason is that we seem to be comparing apples to oranges. Amazon is growth-hungry, while Walmart is fighting for market share, but continuing to be far more profitable than Amazon (see also income statement).

Of course, the question is which of the two businesses will be healthiest in ten years’ time.

Both companies need to strive for excellence. Amazon will succeed as long as its shareholders value growth more than profitability. My bet is on Walmart staying ahead by continuing to strive in optimising its:

  • Strategy: How do we assure the strengthening of our Unique Selling Propositions (USPs) by using offline and online sales channels?
  • Best Practice approach: How can we strengthen our USPs… by doing what exactly?
  • Synergies: How can we better leverage offline and online activities, infrastructure, and logistics to optimise revenue channels?
  • Market Positioning: How can we use our online e-commerce insights smarter in our offline business and vice-versa, as well as selling B2C (business to customer) versus B2B (business to business) in more markets?

Of course, economies of scale will continue to play an important role. Moreover, dynamic pricing might play a bigger role in the near future.

Nevertheless, the last word has not been spoken. I, for one, do not appreciate Amazon’s smart attempts at dynamic pricing when selling me print books, for instance (see below).

1. Amazon shows higher price for hardcover version of Tim Harford's book. 2. After client searches for paperback, hardcover price is reduced by 18% = discount... How much can we influence an online shopper to buy the more expensive hardcover to get it faster than waiting for the lower-priced paperback?

1. Amazon shows higher price for hardcover version of Tim Harford’s book. 2. After client searches for paperback, hardcover price is reduced by 18% = discount… How much can we influence an online shopper to buy more expensive hardcover to get it faster than waiting for the lower-priced paperback?

As the above example shows, value-pricing used in combination with dynamic-pricing succeeds with me, sometimes. Some brick-and-mortar businesses have started to do the same in-store such as Fnac Darty and Migros. So far without a big backlash from their clients. But once they realise what is happening… who knows what could happen?

[su_box title=”Table 1: Dreaming together” box_color=”#86bac5″ title_color=”#ffffff” radius=”5″ width=”px 700″ ]
While Tesla and Amazon’s share prices continue to go up, if not soar, investors continue treating traditional carmakers and brick-and-mortar businesses as if they were seriously ill.

But the gloom surrounding the incumbents, which still have strengths the upstarts lack, seems overdone.

See also: Together in electric dreams

By the way, since their record-high price in June, Tesla shares have fallen by 18 percent. The Insurance Institute of Highway Safety (IIHS) conducted a crash test with the Tesla S and did not give it the highest rating. The research arm of the insurance industry, the IIHS’ crash tests are increasingly influential in guiding vehicle safety design.
[/su_box]

4. Have your say – join the conversation

Source: Amazon, Walmart, Carrefour: The winner is?

What is your opinion?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. I neither got a freebie from any of the mentioned companies nor are they our clients to the best of my knowledge).

Final remarks – July 11, Amazon Prime Day

Being a member and paying €69 or US$99 a year gives you faster delivery and allows you to shop and get exclusive deals during Amazon Prime Day. This year Amazon announced on June 30 that the big day will be July 11.

This Tuesday, clients get access to hundreds of exclusive deals, not for the usual 24 hours, but 30 hours. The digital marketplace giant bought TV spots for the event on various channels and in several time slots in the US (see below).

This reminds me of Christian Meyer from müllermilch (responsible for much of their marketing). In his talk at the #MCLago event in Constance (Lake Constance), he explained why his company prefers TV advertising over digital. Seems he is onto something, considering giant Amazon also uses TV to get people’s attention.

https://www.youtube.com/watch?v=cMHry1pHnFU

What customers would like to get for 2017 when it comes to GREAT customer service. | Urheber: MaskaRad | Fotolia #97117209

In short, we all have wishes for 2017 (I wish for better customer service in my Christmas stocking). The bad news is, you better manage three challenges to improve your customer service.
The good news is, there’s some low hanging fruit: change quality control, improve procedures for handling client requests / questions, and use one little modification of your marketing team’s behaviour.
It’s that easy, trust me. We spell it out below.

Customer service is constantly gaining importance, and we need the right procedures to deal with a flood of inquiries. Online chat is often expected, and 24/7 service is the norm.

♥ Curious? Join 1,500+ other subscribers to this blog’s newsletter and read on!

We discussed how challenging this can be a fortnight ago in, Booking.com, Yeego: NH Hotel Group #epicfail. Now we present another case and we have some pointers on how customer service mishaps can be reduced in our and your organisation.

1. Mistakes happen: Let’s make fewer errors

We all make mistakes and that won’t change any time soon. Keeping the number reasonably low, however, is a great start to improving things.

For instance, avoid situations in which your service or advertising is confusing for your clients. In turn, they have to get clarification = more work for you. Worst is if they decide not to buy because asking is too cumbersome for them. Instead they choose a product that may not be as good as yours but seems better because the service is more easily accessible.

One example is below. If your Cyber Monday Week ad is incorrect, you will get people like me to inquire.

Answering customer inquiries that result from our mistakes may be the right thing to do… but avoiding the situation altogether would be better. In turn, we have to answer fewer emails from clients :-)

Vidar Brekke - CMO Highsoft explains 2016-12-06 in an email to DrKPI: "Highstock, Highcharts and Highmaps, ... individually would amount to $2370. The savings are $1210, not $550, which equals a savings of over 50 percent, not 65 percent. We made the necessary corrections on our site."

Vidar Brekke – CMO Highsoft explains 2016-12-06 in an email to DrKPI: “Highstock, Highcharts and Highmaps, … individually would amount to $2370. The savings are $1210, not $550, which is equals a savings of over 50 percent, not 65 percent. We made the necessary corrections on our site.”

The above email is wrong: a 65 percent discount means it should cost $829. The same error was still on the website December 1. I and many other newsletter subscribers got another email with the wrong pricing on December 1, 2016.

Take-away

Discounts are popular, but you have to get it right. Moreover, if a client points out the error and wants the product at the discount you stated, you should come though on your promise.

2. KISS – Keep it simple, stupid: Beware of scalability

In 2012 a Long Island student created a ruckus by going public with the fact that Steve Jobs refused to be helpful for her semester assignment. But he was of the opinion that helping students was not part of his job description.

From: Steve Jobs [address and header confirmed – CA]
To: Chelsea Isaacs
Subject: Re: Mr. Jobs – Student Journalist Concerned about Apple’s Media Relations Dept.

Our goals do not include helping you get a good grade. Sorry.
Sent from my iPhone

See more here: 2010-09-20 – The Guardian – Steve Jobs: not what you’d call helpful to a trainee journalist. At the time, I wrote the following in our previous blog called Commetrics:

Let us be clear: a CEO like Steve Jobs has better things to do than help a student write her paper for a university course. Of course, if this had happened with my company’s CEO, the student would have gotten an answer. But at most, we get one such request a month AND we enjoy giving an answer since it allows us to gain some more insight.

In our case study with Highsoft, I went to the trouble to write an email to Grethe Hjetland, Highsoft’s CEO. I pointed out this problem to her, suggesting she get it fixed quickly to avoid any backlash.

I got no answer for more than two days. So I went to the trouble to write to the Chief Marketing Officer.

For Ms Hjetland it might be useful to have a procedure in place for such cases. The procedure would spell out what is to happen when she is out of town.

One possibility is an assistant who checks your email every morning and does triage, deciding which emails the CEO will need to reply to herself. Emails in a second group the assistant forwards to those best qualified to reply. The last group of emails get replied to by the assistant (if a reply is needed), or are simply archived.

If done correctly, this limits the number of emails the CEO has to wade or muddle through every morning while on vacation or a business trip. If emails are passed on, however, the procedure needs to include a follow-up. For instance, I triage of emails myself. Some emails that I am not qualified to reply to are sent to those within the organisation.

However, five days after I pass on an email, I will check whether the person has sent a reply. Or I might just send a short note to the person who inquired, saying something like, “I hope you have gotten an answer from us regarding the question you sent me…”

Generally, my email gets a response from the client 99 percent of the time. Usually it states that they are pleased that I have followed up. Sometimes I also get information that helps me do my work better.

Take-away – your customer service must be up to standard

Like Steve Jobs taught us, a company’s goal may not include helping a student get a good grade, but surely we want to address issues raised by clients as quickly as possible. Of course, in our small organisation I can answer most incoming emails myself. In Grethe Hjetland’s case, in a large organisation this is not possible. Instead, she needs a procedure in place that helps her get rid of emails like mine, while still getting them answered.

I got an answer in a roundabout way (see below). Unfortunately, this meant I had to spend more time than necessary to get it resolved. Totally unnecessary if your customer service is up to snuff.

Traditional red Christmas stockings - what we wish for 2017 - better customer service | Copyright: Family Business | Fotolia #94352650

Traditional red Christmas stockings – what we wish for 2017 – better customer service
| Copyright: Family Business | Fotolia #94352650

3. Truth in advertising: Do not add insult to injury

Since 2005, Cyber Monday takes place the Monday after the US Thanksgiving holiday and following Black Friday. It has turned into a four-day weekend of pre-Christmas sales. These days, Cyber Monday is spreading its wings to various countries in Europe such as the UK. Even in Switzerland, some store chains like InterDiscount have specials on Cyber Monday.

This is probably the reason why Norwegian company Highsoft AS sent out a mailing to its subscribers with the offer shown above. The CMO and myself went back and forth, and he acknowledged and apologised for the error.

Remember, 65 percent of $2370 is $1541. Truthful advertising requires that the final sales price is therefore $829.

Around December 16, just about three weeks after I pointed out this error, the Chief Marketing Officer had passed on my last email reply to an associate. This new person wrote me the following email:

From: Katharina von Oltersdorff-Kalettka at highsoft.com
Subject: Re: Cyber Monday – Misleading Ad?
Date: 19 December 2016 at 08:28:24 GMT+1
To: Urs.Gattiker

Hi Urs,
thanks for getting in touch.
I am Katharina, one of the Global Account Managers at Highsoft.
I am more than happy to give you the (although no longer valid) price of $1160 for the Highcharts Suite. This is a package price that includes Premium Support. An option for purchasing it without the premium support is not available.
Let me know if you would still like to proceed and I can arrange for that.
Much thanks,

With regards,
Katharina von Oltersdorff-Kalettka
Global Account Manager
Highsoft AS

Remember, 65 percent of $2370 makes up $1541, which would give us a sales price of $829.

What does the above email suggest?

  1. After several email exchanges, Vidar Brekke, Chief Marketing Officer of Highsoft decided to pass on the case to a co-worker. But how much information (i.e. all the email exchanges he had with me) did he pass on to her?
  2. Ms von Oltersdorff-Kalketta either did not get a copy of the whole conversation I had with Vidar Brekke or she may not have read it properly. Nevertheless, it sounds like I should be grateful to get the 50 percent discount.

What adds insult to injury is that it should show and reflect the adverised 65 percent discount. Truth in advertising requires that you keep your promises. Does this not violate my trust? Mind you, this is a company that claims on its website:

We are trusted by… 72 of the 100 largest companies… of the Fortune Global 500.

Trust is great, including truthful advertising. From Highsoft I wish to get truthful marketing campaigns and a speedier customer service. Moreover, starting in 2017, I do not want to get the runaround anymore when I point out an error in advertising.

Take-away

As an entrepreneur I have learned that it is sometimes smarter and faster to get the job done yourself. In this case, I would have sent the last email stating the final price, i.e. $829 to customer. The associate would have gotten a carbon copy and would have processed the order. Then she would have sent a confirmation to me about the order, such as a pdf file. In turn, our accounting department could process the payment.

  1. Apparently, CEO Grethe Hjetland does not have a procedure that takes care of such incoming email. But she requires one, considering the amount she must be getting, making it impossible to answer mine, and
  2. CMO Vidar Brekke should always finish a job he starts. In this case it would have resulted in this potential client not getting more run arounds.

Highsoft AS provides a great product that the company continues to improve continuously. Hats off!

If it now could just do the same in its sales and marketing, this would be the best service the company could do for all its clients. Wouldn’t it? And customers’ word-of-mouth marketing will surely help improve brand awareness.

4. Have your say – join the conversation

Source: Steve Jobs and great customer service: 3 keys to success

What is your opinion?

  • Do you remember the last time you had a company wriggle out of honouring its own advertising?
  • What procedure do you have in place, if a customer or potential customer sends an email to any C Suite employee?
  • What bugs do you hate the most when you need customer service?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. I neither got a freebie from any of the mentioned companies nor are they our clients to the best of my knowledge).

By the way, we had a similar problem with a customer for our DrKPI software. I decided that it was our advertising error. Truthfulness in advertising is very important to me. Accordingly, the client who made us aware of the error got a freebie worth $1475. All others who paid or ordered before we changed the price, got a refund for the difference due to our error.

We felt that this was only fair, because we do not want to be accused of false or deceptive advertising.

I hope next year will bring us all better customer service. Happy Holidays | Copyright: JenkoAtaman | Fotolia #125884035

I hope next year will bring us all better customer service. Happy Holidays
| Copyright: JenkoAtaman | Fotolia #125884035

Final remarks

In case you’re interested, while Highsoft AS has a blog, it does not allow for client engagement, such as the option of leaving a reader comment. This means fostering engagement and dialogue has been deactivated. Surprising and so much Web 1.0.

Here’s the blog’s data as of today, and get more from DrKPI here.

Highchart Software's Corporate Blog does not allow for reader comments | so Web 1.0 instead of Web 2.0 | Urheber: DrKPI®

Highchart Software’s Corporate Blog does not allow for reader comments
| so Web 1.0 instead of Web 2.0 | Copyright: DrKPI®

My Feedback for NH Hotel Group: Reservation Helpline = #bigfail | Urheber: Anyaberkut |auf Fotolia #107478254

Summary: Leveraging your digital prowess means providing great online service to start with.
This case study outlines how digital failings can lower trust and reputation.
How this affects your brand equity is discussed.

Last month I made my travel plans to attend the 43. Deutscher Marketing Tag (43rd German Marketing Day, see the interesting program – PDF file, 2.4 MB).

One of the first questions was whether to book my hotel using an online platform or directly on the hotel’s website?

♥ Curious? Join 1,500+ other subscribers to this blog’s newsletter and read on!

Of course I had heard about the duopoly of Expedia and Booking.com. They handle four out of five agency bookings in Europe. At 80 percent, that means that the third operator, HBS, has apparently lost a lot of ground recently. Other small competitors and start-ups, such as  bookbedder, are offering property owners better terms.

But hotel owners do not necessarily like these platforms. For instance, you pay a 12 to 15 percent commission to Booking.com. However, regardless of customer evaluations, your property may still rank seventeenth on the list. If you increase Booking.com’s commission to 40 percent, you’re suddenly ranked first, as experienced by Thomas Küble, manager of Berne’s Ambassador and City hotels.

Brand equity seems to play some role in this game of chess. According to David A. Aaker brand equity is like a chest of drawers with the following:

1. Awareness of the brand, meaning our target audience knows about our brand – or not.
2. Associations with, and beliefs about the brand (e.g., associating the brand with sustainability).
3. Attitude towards the brand (i.e. positive, negative or no opinion).

The following NH Hotel Group reservation staff case neatly illustrates how digital prowess can influence a person’s belief about a brand. We also outline how someone’s attitude toward the brand changes in the process of making a hotel reservation.

1. Price match

The first thing a hotel would want to do is match the price on any of these platforms. In other words, you do not have to undercut them, but offering the same value for money is obvious. Let me explain.

For my stay during the Marketing Day in Leipzig, I looked at Booking.com and other platforms, including the hotel’s own e-commerce shop: NH Hotel Leipzig Messe.

NH Hotel Leipzig Conference - Surprise us, please.

NH Hotel Leipzig Conference – Surprise us, please.

When I checked the NH Hotel Group’s own reservation platform, I found the price as listed below. An additional €10 or more on top would be due for breakfast.

Room rate of €98.90 plus breakfast = 30 percent more than elsewhere online. Does that build customer loyalty?

Room rate of €98.90 plus breakfast = 30 percent more than elsewhere online.
Does that build customer loyalty?

So I started searching the web to see if I could find something cheaper. I found several platforms that offered me a room in Leipzig for a similar or even lower price. Because I wanted to stay near the conference venue, the NH Hotel Leipzig Messe was ideal. What puzzled me a bit was that some platforms offered me a lower price for this hotel than its own website did.

Hence, I checked if the hotel would match any of those lower rates.

2. Make things easy for your client

The price guarantee below shows that for all practical purposes, advance bookings have to be paid in full and are non-refundable. Quite common in the industry (see also Accor Hotels). This rule is important for getting the refund, as I will explain a bit further below.

The rate conditions are standard, i.e. you pay in advance and incur a charge if you cancel your reservation.

The rate conditions are standard, i.e. you pay in advance and incur a charge if you cancel your reservation.

So I wanted to take NH Hotel Group up on its offer to match a competing platform’s offer. You can get hold of reservation staff via phone or chat.

I tried the chat twice, i.e. I lost the agent once so I had to try a second time. After the first try, I called, but was told the phone agent could not help.

So after wasting 10 minutes on the phone I tried the chat a second time to see what the NH Hotel Group would do about following its Best Price Guarantee (see above).

To do this via the chat, you need to present NH Hotel Group with the competing offer. So I sent the yeego.com policy as a screenshot.

Yeego - owned by Italian Escapade S.R.L. offers a 25 percent better deal than the NH Hotel Group's own website. Does that make economic sense?

Yeego – owned by Italian Escapade S.R.L. offers a 25 percent better deal than the NH Hotel Group’s own website. Does that make economic sense?

Yeego’s cancellation policy (see above) is actually way better than what NH Hotel Group offers (see below).

When a best price guarantee is worth less than the paper it is written on - NH Hotels - sounds great, but in reality it is a #epicfail.

When a best price guarantee is worth less than the paper it is written on – NH Hotels – sounds great, but in reality it is a #epicfail.

3. Building trust: Apply your Price Guarantee correctly

The agent from NH Hotel Group compared the Yeego policy with theirs. Anyone would expect that NH Hotel Group would offer me the room for €80 less 10 percent, as stipulated in the policy, which would add up to €72 including breakfast. Think again!

Below I show the critical part of the chat protocol indicating why NH Hotel Group was ‘unable’ or ‘unwilling’ to follow their Price Guarantee Policy.

NH Hotel Group's Best Price Booking Guarantee is a strange one... if the competition's conditions are more lenient and generous, NH does not match the offer... go figure!

NH Hotel Group’s Best Price Booking Guarantee is a strange one… if the competition’s conditions are more lenient and generous, NH does not match the offer… go figure!

As you can see further, Yeego.com offers me a refund in full minus a €15 fee. All I have to do is cancel at least seven days in advance using their website. By contrast, NH Hotel Group only offers me a ten percent refund.

Obviously, Yeego is more generous than NH Hotel Group, even with their refund policy. Which means – according to their rules – NH Hotel Group is not required to honour their price guarantee. That does not make sense, but it is exactly what the reservation agent told me as shown above.

What does this tell us? Read on and find out.

[su_box title=”3 takeaways: How hotels make it EASY for Booking.com, Expedia and HBS.com to succeed” box_color=”#86bac5″ title_color=”#ffffff”]

1. Damaging trust: Make sure your staff does not truly understand your policies

If you offer to price match, and take an additional ten percent off (in my case €72 price for room and breakfast), do it. In other words, don’t tell me that because the other site’s refund policy is better, and yours is misleading, you won’t make it right. You’re basically telling me you don’t want my business, and that’s just ridiculous.

Using a loop hole to avoid honouring your own policy when push comes to shove damages clients’ trust in your brand.

2. Buyer beware: Use your digital means to annoy your clients

“We’ve seen from our customer research that 65 percent of all guests are likely to re-book hotels where they’ve had a great experience, and staff attentiveness ranks as the top driver of great hotel experiences.” – PWC

Having to jump through too many hoops to get an answer from your service agent does not make a great FIRST impression.

Worse is that I will likely tell my colleagues and friends about it. In short, through this blog entry, you and many others now know the NH Hotel Group’s price guarantee is not worth the screen you see it on.

If this does not amount to an example of what negative word-of-mouth marketing can do to PR, what does?

3. Damaging reputation: Adding insult to injury

Making it hard for your client to get their problem resolved does injury to your relationship. It also shows that you still need to learn a lot in order to master digital sales. However, you add insult to injury if you fail to do right by your client.

Two things can happen. First, customers may shy away from booking a room via your own platform. Instead they may prefer using Expedia or Booking.com to make a reservation. Second, for each room sold that way, your net revenue will be reduced by 15 percent or more. This is the additional cost you must bear in the form of a commission paid for each room and night sold through these platforms.

As a business owner, I find this a strange way to improve your company’s ROI (return on investment).[/su_box]

4. Have your say – join the conversation

Source: Booking.com, Yeego: NH Hotel Group #epicfail

What is your opinion?

  • Do you remember the last time you had a company wriggle out of honouring its own policy?
  • How do you ensure that your employees know how to interpret a company policy correctly?
  • What bugs you the most when it comes to shopping online?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. I neither got a freebie from any of the mentioned companies nor are they our clients).

To put the icing on this proverbial cake, maintenance of NH Hotel Group’s website is done during the week.

So, when people want to book on a regular weekday morning, they get nothing. My visit on Tuesday, November 8, 2016, around 08:30 (MET) yielded this:

Your site is under maintenance during regular local business hours. Does this build customer loyalty? Maybe try Friday or Saturday night at midnight, instead? You know, when people aren't trying to sned business your way... All together now: #epicfail

Your site is under maintenance during regular local business hours. Does this build customer loyalty? Maybe try Friday or Saturday night at midnight, instead? You know, when people aren’t trying to sned business your way… All together now: #epicfail

Final remarks

Because Yeego.com offered a better guarantee (i.e. refund policy), I booked there for €80 including breakfast. I will see on November 23 how attentive the staff is when I stay overnight.

In David A. Aaker’s language about brand equity, this case illustrates that my association and beliefs about the brand changed. I associate it not with keeping its promises as stated in the Price Guarantee. My attitude towards the brand has moved from no opinion to a negative one. Maybe my visit to the Leipzig property will change that.

Crowdsourcing consumers started in 2007 with getting them in creating selfie videos to asking them to design luxury watches today | Author : Rawpixel.com| Fotolia #88900750

Summary: What went wrong with content marketing during 2015 and 2016?
What are the 3 critical things you must do to produce successful content that creates buzz for 2017?

This blog entry is part of the DrKPI #Trends2Watch Video Series for 2017.

The series’ main focus is trends, without giving you a checklist to solve everything. Instead, we point out what went wrong and what things we must change to succeed next year. In fact, it’s best if you start implementing these suggestions right now, while putting together content for your next blog post.

♥ Curious? Join 1,500+ other subscribers to this blog’s newsletter and read on!

1. What is Marketing?

Marketing is often misunderstood as being the same as sales. However, marketing focuses on the needs of the clients. Theodore Leavitt put it as follows:

Selling is preoccupied with the seller’s need to convert his product into cash; marketing with the idea of satisfying the needs of the customer by means of the product and the cluster of things associated with creating, delivering, and finally consuming it.” – Theodore Leavitt (see https://hbr.org/2004/07/marketing-myopia)

Thus marketers must learn their customers’ needs and how the company’s current products satisfy them.

In turn, gaps can be identified and with the help of R&D, for instance, new products can be developed. The product can then be sold because it solves another important problem your client may have.

2. What is Content Marketing?

The above indicates that content marketing is also often misunderstood. Thus people produce content that tries to sell their product or put it in the spotlight.

However, good content marketing supports our efforts in general marketing. That means the primary focus for content marketing must be helping us understand customers’ needs. While redundant at first glance, content marketing supports our efforts for better understanding of what the client needs as part of our overall marketing strategy.

Content marketing focuses on clients’ and prospective customers’ needs and problems. It tries to address these by providing content that answers questions clients need or want answered. Good content provides solutions or new insights to issues or problems that matter to our target audience.

There is a large group of customers that appreciate content that solves real or assumed problems. An example is:

How to do your make-up in 30 seconds every morning

Content marketing addresses the needs of clients. This may be as simple as:

“How do I build my own bookshelves?” or
“How should I organize may sales activities each month?”

Of course, if your blog focuses on sustainability and the blog entry talks about aquaculture, your content is a bit more complex than if you explain the make-up bit. But if that is what your target audience needs, that’s the kind of content you want to try to create.

3. Improving our Content Marketing for 2017

In a customer support forum it is perfectly all right to talk about how to better use our product. The same applies in a product blog, where we update readers. For instance, we may have power users share their insights and tricks with others. We may also report about upcoming product updates or possibly workshops being held nearby for users of our software.

While the above helps with current clients, it may fail to attract potential clients. The latter do not necessarily want to know about our product or updates. Instead, their focus is on solving their own problem(s), such as:

  • how to shop for clothes that make you look great,
  • the 10 best restaurants in Torino, Italy, and
  • how to show how my content marketing helped our bottom line.

Some of these issues and possible solutions I point out in the video below.

VIEW the 1-Minute Video below for more details
Download the slides used in the video (500 KB PDF).

[su_box title=”3 takeaways: How to make sure your content provides value for your target audience.” box_color=”#86bac5″ title_color=”#ffffff”]

1. Avoid preparing generalised list content, such as “10 best tips…”.

Whatever it is, focus on providing added value or solving a problem that is of concern to your target audience. For instance, 3 points that help you make a better video than the one I made above. That will get my interest, guaranteed :-)

2. Talk with your clients.

  • What concerns do they have (“making sense of web analytics is tough”)?
  • What are their pain points (how to…) for which they would love to consume content (e.g., slides, video, blog entry)?

3. Get client feedback about your content.

You wrote about a problem, because of the input you got about the topic from clients (see point 2). After it is published, call your source and ask them for feedback about how useful the content is or what is missing. Even better, ask them to do so in the form of a comment on the post. You can then can reply to further help your audience.[/su_box]

4. Have your say – join the conversation

Source: 2017 trends: 3 rules for better content marketing

What is your opinion?

  • When was the last time you read interesting content on a corporate, fashion, music or hobby blog?
  • Do you like to get slides or checklists to download in a blog post?
  • What irks you the most when it comes to corporate blog content?

The author declares that he had no conflict of interest with respect to the content, authorship or publication of this blog entry (i.e. I neither own any of these brands’ products nor are they our clients).

Short content with little depth will not do

These days we are inundated with data on our newsfeed, social networks (e.g., Instagram images), YouTube, etc. Some of us even read newspapers in digital or, surprise, traditional format.

Here is a short video from 5 marketing influencers (how did they become marketing influencers?), that talks about the evolving content marketing trends for 2017.

Six minutes in length, of which only 1 minute by 1 person provides this viewer with some value. That is a recipe for failure in Content Marketing for 2017. It also means that those that supposedly know may not know that much more than you do. Pity.

If you have not already done so (of course you have!), please make sure your content for 2017 has added value for your clients :-)

 

Guess who says something that makes sense in the Content Marketing Trends Video for 2017.

If you watch this video and have the feeling that you now know what 2017 will bring (i.e. challenges or opportunities for those creating content), you are way ahead of me – so please share!