Ernan’s Insights on Marketing Best Practices

Monday, November 29, 2010

Megatrend #3: Consumers Share Detailed Information in Exchange for Value

The Myth: Privacy sensitive consumers are unwilling to share in-depth personal information with marketers.
The Reality: Consumers, (BtoB and BtoC), are quite willing to share information with marketers -- if they believe the information they share will result in receiving relevant and valuable information and offers.
In recent blogs, I shared two megatrends of 21st century marketing: Megatrend # 1; customers expect multichannel, preference-driven communications and Megatrend # 2, that they expect us to trust their requirements for deeper engagement.
Let’s take a look at Megatrend # 3, which is also based on learnings from recent VOC research for companies such as Microsoft, HMS National, NBC Universal and Life Line Screening.
Megatrend # 3; there is a growing recognition among consumers that, in order to receive or access increasingly relevant information, they must share increasing amounts of information about their preferences.
If they trust the marketer and see a useful value proposition, consumers will Opt-In and self-profile their preferences and expectations by providing significant amounts of information. We call this the Reciprocity of Value Equation: Marketers who provide increasingly relevant information and offers will in turn, receive increasingly detailed Opt-In preferences from customers and prospects.
This results in the creation of a uniquely accurate and detailed database. The unprecedented accuracy is because the information is self-profiled, not inferred as with traditional databases.
To take full advantage of the Reciprocity of Value Equation, your initial value exchange must be powerful. Microsoft’s VOC-driven Relationship Marketing (RM) program, delivered through its Business Resource Center, initially poses fourteen detailed business questions in order to deliver targeted and relevant offers and information.
Microsoft's results were unprecedented:
arrow Opt-in rates up to 95%.
arrow Open rates greater than 50%.
arrow Response rates performing in the double-digits.
arrow Volume license renewal rate is 8 points higher than the control group.
arrow Volume license revenue from those in the Opt-In driven relationship program is 2X greater than the control group.
Try This:
Test the increase in response and revenue you can achieve by building an Opt-In driven database.
First, conduct VOC research to understand how different customer segments define the value proposition you must create to motivate them to Opt-In. Also, determine what questions are appropriate to ask, and when, in the course of their relationship with your company.