The Noah Principle is a phenomena that describes everything from the stock market to why your marketing organization is struggling. It goes like this:
“It’s not enough to predict the rain, you have to build the ark.”
Coming off of the event circuit, every brand is feeling additional urgency to capitalize on the next “big thing” that promises to do the only things that matter to retail marketers investing in tech: (1) make money, (2) save money and (3) save time.
But before you go building your ark, signing up for free pilots and horse-trading for budget, here are a few buy-ins I see the most successful brands subscribe to as they make investments:
- The same organizational structure and dogma that worked to build the stack will not work to hack the stack.
- The term “strategy” can not be applied at the campaign or channel level. It only works when your customers or products are at the center.
- Technology should solve a business goal, not an ill-fitting proxy.
Here’s how you need to think about these critical points in order to make the most informed technology decisions.
Prioritizing Organizational Readiness
Organizational readiness is a critical factor in determining whether a new technology works for your business. Think about your marketing stack as a human body and the vendor as an organ you are transplanting to replace or augment something that you know isn’t working. A lot of work needs to go into making sure the body accepts the new organ.
One of the key signs of organizational readiness is a clear articulation of the business problem you need to solve. I can’t imagine a Director of eCommerce wakes up thinking, “I really need to do some A/B testing today.” Rather, use cases should revolve around customer awareness, traffic acquisition and conversion. This requires a pretty solid understanding of how your current vendors are performing against the core retail problems they should be influencing. Here’s a cheat sheet of the core business problems (in order of easy→ hard) that I hear brands talk about the most:
- Product discovery “cross sell”
- Revenue optimization “sell through”
- Inventory optimization “right product, to right user”
- Product margin optimization “right product, to right user, at right price”
- Maximize profit “maximum revenue, at best margin, across available inventory”
If your team can get behind these business outcomes and come to a shared understanding about where there are gaps to drive associated metrics, you are ready to send out that RFP.
Applying “Strategy” to Consumers and Products… Not Your Channel
The term “strategy” is fun. It sounds important, so it’s applied everywhere. But because of that, the term often distracts from the true application, which starts to fall apart as you break your business goals by channel, function, team and customer segment.
Most brands will agree that the customer is the most important — the center of the communication. Yet, most martech teams start their day with a content calendar that starts with the channel, then the product, then the promotion and lastly the customer. Since when is the “who” a by-product of the “how?”
At Bluecore, we have a set of beliefs that help remedy this:
- Email is the most important channel. Not only does email have the highest ROI, the most consistent budget and the best form of addressable identity (the email address), but it is also the last owned channel that doesn’t crumble based on newsfeed algorithm changes or the latest Do Not Track regulations.
- As the king of channels, email is well-suited to become the orchestration and decisioning hub for all other technologies. This requires your email partner to understand business context (e.g. sell-through goals, real-time catalog changes, margin, etc.) and marry that with known and anonymous identity to help you understand the value of your customer. Notably, this value goes far beyond your customers’ purchase history, as it should include a predictive understanding of category affinity, discount preferences, lifetime value and more.
- A world exists in which your email partners can do the above. It’s possible to develop both intelligence and decisioning capabilities on top of the email loop so that email can become your strategy. In this world, email will act as a single orchestration hub that determines the “who,” “what,” “when” and “where” of your messaging streams.
Focusing on Results Over Proxies
I recently had a marketer tell me, “I don’t care about my brands’ margins.” I’d like to believe this really meant, “I have no way to care about my brands margins.” Today, that’s largely because most of the tried and true technology vendors that make up tech stacks were built on antiquated systems or duct taped together through acquisitions. At the time these technologies were built, the depth of eCommerce data and business context data that surrounded users didn’t exist. There just wasn’t a substantial enough customer data footprint to trust tracking and reporting against business goals.
Now, every brand has some sort of tracking pixel on their conversion page and uses some version of the big eCommerce players. Even the in-house bespoke platforms can accommodate API integrations to pass valuable business data. And that means that it’s time for the business results and lift in key eCommerce metrics to take the stage instead of proxies like sends, impressions, page views, etc.
In 2018, these are the goals and metrics to which you should be holding your technology vendors accountable. If they can’t cut it, it’s time for a switch.
It’s Time to Bring Strategy Back to Email
Brands that evaluate organizational readiness before hacking the stack, view their marketing beyond the confines of a channel and hold their vendors accountable to business goals like growing profit stand the test of distributed commerce (i.e. people buy where they are, and that is constantly changing).
You can start slow, with just an audit of your existing vendors. As you do, you’ll be surprised at how much hidden budget exists when you trim the fat by consolidating in areas where you are duplicating (and therefore fragmenting) the view of your customers and business. This sets the stage to have a conversation with your team and others before investing in solutions that play nice and drive measurable outcomes.
What else do you need to know to get started? Check out Jared Blank’s presentation from eTail West on the one word that will transform your marketing.