You’ve heard the old saw: “I know half of my marketing budget is wasted. I just don’t know which half.” Once it was a wry comment on a common dilemma, but now it just doesn’t wash. Today’s digital technologies let you communicate with your best prospects, whenever you most want to talk with them, at scant cost. And you can measure your results.
Want proof? Watch how three PROFIT 100 companies have mastered the art of digital marketing — and take notes as you go along to see which of their techniques might apply in your business.
Closer and closer: Serenic Software Inc.
When Linda Nicholson arrived at Edmonton-based Serenic Software Inc. (No. 20 on the 2008 PROFIT 100) last fall as VP marketing, she discovered a problem. Serenic, a producer of accounting-management software for non-profits such as foundations and church groups, Serenic had been spending $400,000 a year on advertising in industry publications. But when Nicholson called new prospects to gauge their interest in Serenic’s flagship product, Navigator, she was alarmed to find they had never heard of Navigator. Or Serenic.
So, Nicholson hatched a bold plan: switch Serenic’s entire ad budget from print media to online applications. It made sense: Like many companies, Serenic’s website is the centrepiece of its marketing, offering demos, case studies and testimonials. It also hosts regular “webinars” that showcase Serenic’s products or provide special advice on fundraising, ministry management and other topics of interest to non-profit clients.
But Nicholson doesn’t think print ads lure prospects to her website: “We spent hundreds of thousands of dollars on advertising, and what we got back was minimal.” In one case Serenic even ran an ad offering a pair of noise-cancelling headphones to each prospect who registered with the company. Number of responses: One. “Working with the same publishers and the same publications, we took our money online,” says Nicholson. “We looked for ways that would enable subscribers to respond to us immediately.”
Serenic’s online ads tempt prospects to clickthrough by inviting them to webinars or offering premiums such as white papers. The firm’s Colorado-based marketing team monitors progress to learn what works and what doesn’t. “It’s just like any advertising,” says Nicholson. “The message has to be right there. People are so busy now that if you can’t capture their interest within minutes of seeing your offer, it’s never going to happen.”
Serenic also invests heavily in Google AdWords, the pay-per-click ad service that lets you pinpoint your target markets by bidding for selected keywords. Whenever someone in your market area Googles your keywords — e.g., “donations management” — you can ensure your ad pops up at the top of the search results. And you pay only if prospects click through to your site. But Nicholson notes the competition is getting hot: “We’re having to pay more than $5 [per clickthrough] to get our ads up high enough for people to see them and click on them.” Still, she says, “the ROI can be huge.”
She’s also sold on Webcasts, the online product demos or industry lectures that Serenic hosts twice a month. While they attract just 20 to 50 people each, she notes, they cost almost nothing to produce. And besides, the Web isn’t always about the masses. For many niche businesses, Web marketing means drawing your best customers closer and closer. Webcast viewers, for instance, are hot prospects for Serenic’s products. The Webcasts are also archived and made available to qualified prospects. “That’s almost more important than the live event,” says Nicholson. “These can be lead-generation tools for months and months.”
Recently Serenic and NPTgrantsearch.com teamed up to sponsor a Webcast on projecting revenue, aimed at top executives at non-profit organizations. Some 1,500 people registered, and 750 actually watched the Webcast. Better still, 200 others contacted Serenic for a copy of the video. These are “soft” leads, but Nicholson is patient: everyone who registered for the webcast provided their e-mail address. “We’ll probably continue to touch these 1,500 people every month or quarter,” she says, “until they tell us to stop.”
If your company has a hard-working website that drives sales or generates inquiries, you may find digital initiatives such as these actually easier than old-school marketing. Take Google AdWords, for instance: all you have to do is sign up (at adwords.google.com) and identify your geographical target markets, your keywords and the maximum price you’re willing to pay for a clickthrough. The software does the rest, publishing your ad on appropriate Web pages or alongside related search results — until you reach your monthly spending limit. Similarly, software such as Microsoft’s Live Meeting makes Webcasts and online collaboration easy to manage and host. You pay a monthly fee based only on the number of internal users of the product — not the number of customers who watch online. And once you have a list of prospects’ e-mail addresses (and, of course, permission to contact them), e-mail marketing is the fastest and cheapest way to contact a customer.
Nicholson has no regrets about taking her advertising digital. Besides being able to track results and follow up almost for free, she loves the opportunity to test Serenic’s offers fast. If she’s sending out 2,000 e-mails tomorrow, she might send out 100 today, in groups of 25 — each group bearing a different headline. Based on the response in the next few hours, she can then decide which headline to use for the full flight. “It’s not scientific,” says Nicholson, “but it’s better than the guesswork we had before.”
What’s next on her electronic agenda? Nicholson wants to start a blog to update customers, prospects and friends on issues of interest to Serenic and its community. She says she’s trying to pursuade the right people — Serenic’s top executives or product managers — to start blogging. “Marketing and PR people can write a blog, but it won’t be successful unless you have a true expert on the industry or the product writing it. People don’t go to blogs for marketing messages. They want real information.”
The power of blogging: Elastic Path Software Inc.
No one has to convince Harry Chemko of the value of blogs. The CEO of Elastic Path Software Inc. (No. 23), a Vancouver-based developer of e-commerce systems for online retailers, has been contributing for two years to his company’s blog on online commerce, Web design and search marketing. His contributions to the blog, called Get Elastic, have ranged from reviewing trade shows to a video interview with two U.K. gadget retailers.
“There are lots of e-commerce vendors out there,” says Chemko. “It’s hard to stand out, so we’ve done things to differentiate ourselves.” As a 28-year-old leading a young company with clients like Aeroplan, Samsonite and Time magazine, Chemko focuses on his company’s credibility. It positions itself as an e-commerce “thought leader” through original research — it recently produced a 50-page report on best practices in automated checkout processes — and monthly webinars with industry experts. According to Chemko, each webinar attracts “a few hundred people,” plus more who download the presentation later.
But Chemko’s key weapon is the Get Elastic blog, which has 2,400 subscribers and ranks, according to Alexa.com, among the Net’s top 138,000 websites (which is more impressive than it sounds). Get Elastic is an almost daily series of employee-written articles talking about new e-commerce developments. Recent topics include optimizing your product pages for search engines, a sample of online retailers’ Earth Day promotions and how to keep your e-mails from being blocked by clients’ spam filters. Only occasionally does the blog promote Elastic Path. “We probably talk about our competitors more often than we talk about ourselves,” says Chemko.
And that’s the key to blogs: Credibility. Giving your customers “no-strings attached” content that informs or entertains them creates trust. Your prospects don’t want to be bombarded with sales pitches — at least, not until they have enough information about you to decide if you’re the sort of capable, customer-focused vendor they like doing business with. Once you establish yourself as a trusted supplier of customer-centric information, they’ll be happy to learn more about your products and their benefits.
Who actually reads blogs? Almost everybody. The algorithms used by Google and other search engines favour blogs (since most bloggers write on consistent themes, update regularly and build networks of trust by linking to each other) — so anyone who searches for information on the Net will have a hard time avoiding blogs. Plus, bloggers are becoming a popular source of specialty information, even for busy businesspeople. In an Ipsos study released last month, 30% of C-level executives in the U.S. identified themselves as blog readers.
The cost of a blog: only the writer’s time. “It’s peanuts,” says Chemko. More important, the blog provides 24/7 support for Elastic Path’s thought-leader positioning. It’s not enough to outmarket your competition; you have to “outknow” them. “Playing a consultative role is much more important for enterprise-software sales these days,” says Chemko. “There has to be an actual value proposition.”
Chemko says several big clients have found his company through its blog. Better still, he says, Elastic Path’s “expert” image is increasing demand for its consulting services. “It’s a small part of the business,” says Chemko, “but it’s high value, and it’s growing.”
Reach Out and Text Someone: Tio Networks Corp.
You don’t have to be a high-tech company to use online marketing and social media. Sometimes it just takes a clear vision of your customers’ needs.
In Burnaby, B.C., TIO Networks Corp. (No. 191) runs a system of cash counters and teller machines that allow users to pay their cellphone or utility bills in cash. The service targets low-income Americans; according to TIO chairman and CEO Hamed Shahbazi, 15% of adults in the U.S. have no bank account. With outlets or machines strategically located in convenience stores and gas stations all over town, TIO makes it easy for cash-stretched consumers to pay bills at the last minute: its proprietary systems clear payments immediately, and the fee ($1 to $4 per payment) is usually less than that charged by payday-loan offices.
For TIO, however, the key is to remind its half-million bill payers that its machines are as close as the corner store. That’s why its most successful marketing initiative has been text-message blitzes to the cellphones of up to 100,000 customers at a time.
The typical message is simple: “Pay your phone bill in cash at any Circle K store in Phoenix, and get a 20-ounce soft drink free!” Behind that message is a lot of strategic thinking. There’s the timing: 40% of bills get paid on Friday (payday!), so you have to strike fast. Then there’s the relationship management (the wireless firms want you to pay your bill, so they supply the names and channel — while retailers will absorb the cost of a Coke because most customers will buy something else while they’re in the store).
TIO also advertises on TV, radio, billboards and bill inserts, but, Shahbazi says, the text campaigns, conducted 10 to 20 times a year, pack a big punch. After just one message, bill payments for the month can jump by 25% to 200%, he says: “We immediately see the boost in a market.”
Canadians send more than 30 million text messages a day, but not just any marketer can get in on the action. First of all, you need to build your own list of consumers who have given you permission to contact them: in the mobile market, spammers get slapped down fast. Second, the restrictions of short message service protocol mean your message can be no longer than 160 characters, or about 30 words, limiting what you can say. And the personal nature of the cellphone—it’s a companion, not an advertising medium —means your message can’t be hard-sell or intrusive.
Still, texting can be an effective way to stress a simple benefit that people can take advantage of immediately — whether it’s paying your bills, entering a contest, taking an instant discount or requesting more information about a product. Increasingly, companies are also using text to communicate service-oriented messages to their customers, such as a bank warning a client whose account has dropped below a certain balance. Best of all, text marketing is affordable, costing about 5¢ to 15¢ per message sent or received. You just have to make sure that, like TIO, your message is aligned with your target’s best interests.