The Drift from Upstream

What’s For Sale?

Doug Weaver — Tue, 22 May 2012 17:14:28 +0000

Last week’s Drift apparently struck a nerve with many of our readers. Our first annual “Do Not Say” list offered up several terms – transparency, optimization, partner — that have been so overused that they’ve become hollow, meaningless and ultimately self-destructive for the seller. The comments included other suggested terms (technology stack, robust, best-of-breed), some argument that the sellers were the problem and not the terms, and at least one piece of hate mail about the entire concept. But one common question I’ve heard a dozen times this week is, “So now that you’ve eliminated 90% of the key words we use in our presentations, what are we supposed to sell?”

Simply put, start selling the Three Cs: Clarity, Certainty and Control.

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Clarity: While Transparency has come to represent the narrow themes of open reporting and site lists, Clarity is about how you the media seller are going to help the buyer see the whole picture, understand the landscape, find meaning through their relationship with you. With every customer, in every exchange: simplify, synthesize, explain, make sense of the world for your client. Hold this up as your standard, and you’ll quickly stop bludgeoning them with three letter acronyms. Bringing excessive detail and technical complexity to today’s marketer is like tossing an anchor to a drowning man.

Certainty: Certainty is a concept that can envelop not only the technical expertise and data quality of your offering, but also your organization’s commitment to extraordinary service. In a world dominated by unpredictability, unintended consequences, missed deadlines, broken code and unfulfilled campaigns, Certainty is a transformational concept. If you do business with us, you can count on us delivering and knowing what’s happening every step of the way. Here’s why…

Control: What do the entry level media planner, the agency account director on a major brand, the CEO of the agency and the brand manager and CMO at the client all have in common? They all fear losing control of their own destinies during these asymmetrical, confusing and often contradictory times. Focus on how your products, audiences, services and capabilities can help the customer reassert control over her environment. The planning team fears losing influence and control to the trading desks; the trading desk people fear losing control because of gaps in their technical bench strength; the brand fears losing control of its relationship with the consumer; and so it goes. Control is central, primal, urgent. How many of your current agenda items can you say that about?

Surely there’s an aspirational quality to these ideas: they challenge the ambition and commitment of the sales organization. But if you’re a seller in the field, my advice to you is immediate and actionable. Start building your sales strategy and your conversations around the Three Cs today. Every day you wait is another day you dwell in the land of comfortable irrelevance.

Say This…Don’t Say That!

Doug Weaver — Thu, 17 May 2012 12:59:19 +0000

As I prepare for workshops with digital sales organizations I immerse myself in their sales materials, positioning statements, website, trade marketing and more. I want to know all I can; not just about the company’s unique strengths, but also about how they talk about those strengths. And I’ve concluded that there are several phrases and terms in our industry that have now lost all meaning and, if used, actually do harm to the seller’s cause. I hear dead words…..and they don’t even know they’re dead. So without further ado, I debut The Drift’s first annual “Do Not Say List.”

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Transparency. A term so ridiculously overused that it should be euthanized and buried immediately. You can almost feel the eyes rolling as soon as it’s uttered. Substitutes: Clarity, Certainty.

Brand-Safe. As I’ve said before in this space, “brand safety” is a haven for scoundrels. The idea that we can make undifferentiated network and exchange inventory “safe” by applying some monitoring software is pretty questionable. But above all else, “safe” is far too low a bar. Substitutes: Brand Growth Environment, Brand Enhancing Environment.

DSP. Forget the fact that people use this term interchangeably when referring to everything from the agency trading desk to the hard core technology provider. Find me a company today that will stand up and proudly say, “Yeah…DSP! That’s us!” How fast the journey from being an “It” acronym to being a pariah. Substitutes: I have no idea.

Optimization. At best it’s a promise to vanish behind the curtain, apply some unseen magic, and emerge somehow with an improved result or process. But really it means making the click-rate incrementally better or the price somehow cheaper. Substitutes: Cutting Your Price, Bonusing Inventory to Goose the Response Rate.

Attribution. Hey, didn’t we just get this one? Yeah, but it’s going to be the Jeremy Lin of digital metrics. Besides, with so little desire for genuine attribution metrics on the buy side, what’s the point? Substitute: Short-Term DR Goalpost of the Moment.

Partner. Please. This is something sellers say when they want to pretend they’re not really selling anything, and that buyers say when they want to get rate concessions and not make any commitments. Substitutes. Vendor, Seller.

Disagree? Have a term or two of your own to add? Have at it.

It’s the (Agency) Economy, Stupid!

Doug Weaver — Wed, 09 May 2012 13:39:34 +0000

If you’re insulted or confused by the title of this post, you’re either not a political wonk or came of age after 1993. I’m of course paraphrasing Bill Clinton’s political strategist James Carville as he famously kept staff members in line and on message during the 1992 presidential campaign. It was this maniacal focus on the day’s most important issue that mattered most — or mattered at all — and any deviation from that message was an opportunity lost.

I think about this message a lot as I consider how digital sellers spend their time, energy and capital as they pursue business at agencies. We talk about marginal improvements to performance, brand “safe” environments, effective CPMs and a lot of other minutiae tied to successful stewardship of the latest plan. We prattle on about our latest reporting dashboard, the premium publishers or content we represent, how we’re more “transparent” than the other guys. I wonder if at a certain point of this litany the agency folks just see our lips moving and only hear “blah…blah…blah….”

We stay locked onto the marginal, temporary issues of media planning (insuring that all we’ll ever have is marginal, temporary success) while ignoring the big economic issues that could give our relationship with the agency some much needed urgency and power.

It’s the Agency Economy, Stupid!

My hypothesis is pretty straightforward. We are living at a time of consolidation, in which clients and agencies are going to be dealing with fewer companies, not more. (This trend is masked by the insignificant “testing” that goes on around the margins of planning.) The winning media companies, aggregators and tech vendors will be those who frame their benefits and align their value with the core economic issues confronting agencies. There are four:

Account Security: Senior agency executives live in perpetual anxiety over a major account going into review. That’s a seismic event. But the more subtle, persistent agida comes from the soft erosion of clients inviting other shops in on a “project” basis. If you’re not talking about how your services and capabilities can help the agency drive interest and loyalty with the client, you are missing a big opportunity.

Budget Growth: The dirty secret is that margins on digital media buying are thin to non-existent. The only way the agency stays healthy and profitable is to get its current clients to increase budgets. Too many of us only stay focused on getting our share of existing budgets, instead of on how we can help the agency access and grow the dollars they get from clients.

Workforce Extension: It’s no secret that agencies are severely understaffed. Most don’t have the FTEs (Full Time Equivalents — agency-speak for “people”) to do more than keep up with process. How can your organization serve as an extension of the agency’s own workforce and provide core services — creative, aggregation, marketing, promotion — that allow the agency to drive more profit without more bodies?

Commoditization: And here we sellers thought this was our issue! The agency — and most especially the planning teams — are swimming against the same currents of commoditization and automation that many of us do. How can you effectively bundle your services into programs and add value to them so that they can’t be commoditized or automated? How can you help the daughter agency or the planning team hold onto the spending and influence they so desperately fear losing to the trading desks?

Are these conversations you’ll have with the media planner at the 11th hour of the RFP process? Hardly. But if you’re not engaging in them at an organizational level and allowing them to drive your strategic planning, then don’t be surprised when the RFPs stop coming and you find yourself frozen out of the agency entirely.

The Cranky Traveler.

Doug Weaver — Wed, 02 May 2012 16:18:12 +0000

Scores of plane rides and dozens of nights in hotel rooms every year can sharpen one’s view of the customer experience. Frankly, there are patterns of annoyance in weekly travel that are stunningly consistent. And, yes, I’ve been thinking of how to legitimately whine about them in this space while also crafting a relevant message for Drift readers. So I’ve decided to call out three of these FTAs (frequent traveler annoyances) while also looking at the deeper insight they illustrate for sales organizations.

The Blinking Light on the Phone: You check into a hotel at the end of a very long day, while e-mail and prep for the next day still stand between you and sleep. But the message light on the phone blinks insistently. After several minutes of setting up and accessing your voice mail box you finally retrieve the message: “This is the front desk just making sure everything is OK with your room.” Really? Turns out everything was great except for that blinking light! Message for Sellers: Question the things you do automatically, by rote. That mass email update or the check in call in particular. It could making your customer feel less special, not more.

The On Board Announcements: Who knew the airlines would turn into media companies? From the second you walk on the plane there’s one announcement after another: welcome aboard, names of your crew members, thanks to our frequent fliers, you can sign up to earn triple points, the safety announcements, here’s what’s on the beverage cart, this is the route we’ll be flying and how high up the plane will get… For the love of God, please just shut up for a few minutes! Message for Sellers: Don’t assume that simply because you’re communicating that you’re actually serving the customer. Turn down the volume and the flow of “information” and you just might create an experience that your customer will enjoy, not just tolerate.

The False Pricetag: If you told me the true price of flying with you or staying in your hotel, there’s a good chance I’d pay it. I’d probably even pay a fee to be in your frequent flier program if I knew it was going to be a good experience. But you don’t price things that way, do you? Instead we start with an artificially low picture of cost, and then you systematically pick my pocket with one extra transactional charge after another. $25 to check a bag… $150 to change a reservation … $15 a day for internet access in the room…and handling fees to use the frequent flier miles I’ve earned. Message for Sellers: While we may not necessarily be up-charging our customers with transaction fees, we are far too often taxing them where it hurts even more: by inconveniencing them and eating up their time. Figure out what it will cost to give your customer a superior, premium experience and then charge a premium price for it. You’ll be surprised what a difference this will make in driving true financial loyalty with your customers.

Less than Zero.

Doug Weaver — Wed, 25 Apr 2012 16:33:53 +0000

Spring is upon us. The swallows have returned to Capistrano, the snow tires have been replaced, baseball fans are experiencing either irrational exuberance or premature despair (depending on your team).

And it’s time for our annual discussion of the click-through. Sure, you may have thought that we’d all moved on by now. Certainly no rational marketer or agency buyer could still value a metric that’s been so thoroughly discredited? But you ignore the staying power of a simple bad concept. The idea that consumers will click on display ads (or videos) and navigate away from what they’re doing in order to visit advertiser websites is, of course, false. Yet all these years later, it’s still with us. Click-through attribution is the “birther” movement of online marketing.

The latest rational argument against the click comes from Pretarget and ComScore as reported by Jason Del Rey in Advertising Age (“Click-Through Rates May Matter Even Less Than We Thought.”) The big headline in this study is that even among the microscopically small share of customers who actually do click on ads, there is virtually no correlation between the click and a subsequent conversion. So not only do clicks not matter to brand advertisers, they are at best meaningless and at worst misleading and wasteful for direct response advertisers. One might be able to shrug this off or explain it away if weren’t the millionth data point in an airtight case for burying the click-through once and for all. Only ignorance, self-interest (it’s a handy negotiation anchor for the buyer) or self delusion could explain it’s continued role in the debate, right?

No, there’s one more explanation. Our own complicity in the lie. For too long sellers and agency leaders have been willing to treat the click as a minor annoyance. At times, we’ll even use it to our advantage when it suits us. What we’re not doing is saying, forcefully, “this is not valid…we will not count clicks, we will not value clicks, we will not talk about clicks for another minute.” When serious people stay silent about silly ideas, they take on a sense of legitimacy they don’t deserve. And they end up drowning out all the smart, serious debate.

If we don’t take intellectual leadership on this issue — and soon — we’ll be talking about it for many Springs to come.

All Clear.

Doug Weaver — Tue, 17 Apr 2012 22:05:20 +0000

A friend recently forwarded a link to “Culture Eats Strategy for Lunch,” Shawn Parr’s contribution to the Fast Company blog. The title, of course, is a riff on Peter Drucker’s famous maxim that “Culture eats strategy for breakfast.” (But then Drucker was probably more of a morning person.) As I consult and conduct workshops with hundreds of companies in the digital advertising and marketing world, the wisdom and urgency of this shared theme is inescapable.

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As the marketplace continues to morph and convulse at an astonishing pace, company leaders and sales managers are constantly adjusting their strategies, if not changing them outright. But as wrenching and deep as these strategic shifts may appear at ground level, most end up having little or no lasting effect. Like a house built on sand, they lack the solid foundation that a quality culture can provide. Parr rightly points out that “culture” is misunderstood (considered intangible and fluffy) and mismanaged (relegated to Human Resources) in most companies and in most industries. But I think it’s a particularly acute shortcoming in our world….and I think I know why.

Prisoners of Our Own Success. Many digital CEOs and sales leaders came into their own during times of prosperity. It all came together for us “in the day,” so everybody just do what we’re doing and we’ll all be OK.

Rapid Ascent, Rapid Change. Ironically, we point to the pace of change and rapid buildout of our companies – the very reasons we so desperately need to establish cultures – as the reason we can’t afford the time to develop them. Culture is something we’ll focus on once we’re established.

Perhaps some of this is inescapable: given our backgrounds and the ever-changing landscape, maybe textbook culture development isn’t attainable. (I don’t completely believe this, but I’ll go with it for now.) But maybe it’s time to meet Peter Drucker halfway and focus on the one principle that will establish a beachhead of stable culture within most any company or team.

Clarity.

In “The One Thing You Need to Know,” Marcus Buckingham points out that great leaders may not always be right, but they are always clear. And the thing they are most clear about is “Who Does Our Company Serve?” There’s only one right answer, but you’re likely to hear a half dozen if you informally poll your team members. A clear statement like “We serve brands” will go a long way. While you’re at it, here are a two more topics on which you should be aim to be especially clear:

What Business Are We In? The railroads famously got this wrong. Had they said “logistics and transportation” instead of “running trains,” they’d be FedEx and Delta Airlines today.

How Do We Create Value? The operative word here is “create.” The answer to this question is often masked by the mindless pursuit of product advancement. Far more often, we create value through service innovation, insight generation and synthesis. Good topic to spend some time on.

You may not be in a position to establish the culture of a Starbucks, Zappo’s or Home Depot, but you can convene your management team for a couple of hours around these three points of clarity. If you don’t, you may just continue throwing strategies at the problem without ever addressing its underlying cause.

I Like Ike.

Doug Weaver — Wed, 11 Apr 2012 05:30:53 +0000

Dwight Eisenhower is said to have remarked that “…battle plans are all well and good, right up to the point where someone starts shooting at you.” The implicit warning was to not get too attached to your carefully crafted vision for how things are going to go: because you’re almost certainly going to have to improvise and adjust once it all starts to hit the fan. As I read recently, Ike’s once heretical concept has become a pillar of military theory: “Commander’s Intent.” The focus is now on training the battlefield leader and his troops to expect anarchy, confusion and dysfunction. Today West Point emphasizes improvisation, adjustment and real time decision making… but always tied to a unifying leadership vision – the Commander’s Intent – that says “we’re taking that hill over there.”

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One risks trivializing military service by drawing comparisons with sales, but there’s a comparison here that needs to be drawn. Sales leadership and planning are actually way behind the curve when it comes to Commander’s Intent. We neither communicate a clear, unambiguous vision for what success likes, nor do we coach our teams on the improvisation and adjustment skills they’ll need to pursue that vision. Instead, most sales people still rely far too much on rigid sales process scripts or highly structured, linear presentations – without much of a connection to the leadership vision.

In today’s fast-paced, asymmetrical sales environment – and particularly in our world of digital media and marketing – we need to start letting go of dated models and theory. Presentation skills and negotiation may be going the way of the big gun naval battle and the cavalry charge. The successful manager is training her team around sales innovation: setting an engaging environment, provoking discussion, listening curiously, adapting on the fly.

As Ike also said, “Plans are useless, but planning is indispensable.” It’s no longer about planning presentations. It’s planning how to present. So put away your books of complex theory and your 40 slide PowerPoints. Your interaction with the customer is never going to align with the picture you’ve painted in your mind. The best sellers and managers not only get this point, they build their strategies around it.

The Negotiation That Matters.

Doug Weaver — Wed, 04 Apr 2012 16:12:19 +0000

This week I was forwarded a promotional e-mail from a sales rep at Undertone who offers his client the “Standout Brand Guarantee” — a promise that if a pre-discussed brand metric is not met on a campaign then Undertone will hand back up to $50,000. Last year we heard a similar pledge from Meredith Corporation: Its “Engagement Dividend” would use Nielsen Homescan data to show that ad campaigns run across its magazine properties would actually lift product sales. And then there’s Universal McCann, the agency that’s leading the way in negotiating pay-for-performance compensation deals with its clients: UM actually wants to get paid based on the effect of its work in driving agreed upon measurement for clients – rather than fees, commissions or both. Whether any of these three actions ends up being the harbinger for a new model, I’m not sure: there is bound to be pushback and hairsplitting around all of them. But they are all tied to a critical sales lesson.

Historically terms like pay-for-performance and guarantee have been non-starters for digital sales organizations, it’s usually been because some brain-dead click-based metric was being imposed on them by a disingenuous buyer. It wasn’t about having skin in the game… it was all about getting skinned. But while sales leaders and reps have bitched about lowest-common denominator metrics and payment, few have offered any alternatives. In each scenario the seller (Undertone, Meredith, UM – it is ‘selling’ its services to marketers) is taking charge of the conversation about ROI very early in the process. By agreeing to own an outcome, they are putting themselves in position to decide what that outcome should be and how it will be measured. I think you’ll see more companies taking steps like this in the immediate future, if only because the alternatives – getting paid in bulk for page views/impressions and arguing over click rates – are so unpalatable.

But to localize the idea even more, I encourage every digital sales person to begin proactively negotiating the nature and measurement of campaign outcomes at the very earliest stages of the sales discussion. If you wait for the RFP (never a good idea, by the way) to tell you what’s being measured and how, you’re already screwed. For the past 17 years we’ve left the definition of ROI up to the direct-response oriented ad buyer, and look where it’s gotten us. Truth is, most clients don’t have the background or the vision to really say how digital marketing can help them. Helping them define and rank the potential outcomes is something we owe them.

Take a stand. Get creative. Seek to drive the ROI conversation early and you’ll naturally occupy a stronger and more valuable place in your customer’s esteem. And you’ll find you’ve built a more sustainable base of business for yourself at the same time.

The Week of the Agency.

Doug Weaver — Wed, 28 Mar 2012 18:10:34 +0000

Maybe it was all planned around the Mad Men premiere, or perhaps just the result of cosmic alignment, but there seemed to be an awful lot of commentary on life within ad agencies this week. And not much of it good. If I were one of the agencies with engaged planning teams, professional standards and strong customer relationships, I’d be cringing right about now.

Continuing its “Confessions” series, Digiday (who are doing some of the most meaningful coverage of our business these days) gave us “Confessions of an Agency CEO.” Apparently clients can be dumb, insensitive, shallow and calculating, all at the same time. Who knew? Bitching about clients’ lack of appreciation seems ingrained in the agency culture. (Who can forget the boorish, closet-case Lucky Strike client on Mad Men?) But based on Brian Morrissey’s Digiday piece, that client now has far greater means to inflict pain on the agency: procurement, transparency, the assignment of “projects” rather than a long term commitment to any one shop. Running an agency profitably seems a pretty tall order these days. And at the leadership level, it doesn’t seem like much fun.

In fact, it seems that agencies have become so unprofitable and glum that they’ve been forced to outsource both nutrition and entertainment to publishers and other media sales organizations. As Digiday’s Jack Marshall writes in “The Consequences of the Gift Economy on Online Ad Sales,” “…What media agency jobs, particularly at the low level, lack in salary they make up for in rooftop parties and VIP concerts…This is, in some ways, a business-model decision. Lower staffing overheads means bigger margins and bigger profits.” But as I wrote in this space last year (“Buy Me a Couch!”) we’ve gone far beyond free meals and Yankee tickets. Today it’s increasingly about merchandise. Just last week I was forwarded an e-mail exchange in which a seller invites the agency team for a night out. The reply comes back that what they’d really like to do is go shopping for expensive personal items and accessories. You can’t make this stuff up.

I’m judging neither those who run agencies nor the media planners who take what they can, while they can. But the system is profoundly broken. Those charged with spending the client’s money wisely and effectively are having their lifestyles and wardrobes subsidized by those whose wares they are supposed to judge. Imagine if the Federal government hired border agents by telling them “The pay’s not very good, but you’ll be getting tips, small appliances and cases of liquor from each of the truck drivers who pass your checkpoint.” Cue the outrage.

There was talk in the article about vague agency policies on gift acceptance, but it seems they are pretty ambivalent and mostly optional. If I were an agency CEO out to make a value and culture statement about my shop, I think I’d draw a line in the sand here. Meals? Yes. Merchandise? No. Rep takes you to a sporting event or concert? Yes. Rep hands over tickets but is not with you? No. Make a clear distinction between relationship building and graft. And for God’s sake, if you already have a policy then go public with it and wear it as a badge of honor.

And I’ll put the same message out to sales leaders: challenge your reps on how they’re using T&E budgets. Buying off planners with sneakers and jeans is not just morally suspect but also largely ineffective. The current culture is cynical and self-defeating. The elevation of our business is going to happen one judgment call at a time. I hope we start making those calls very soon.

It’s Not Always the Product.

Doug Weaver — Wed, 21 Mar 2012 13:44:51 +0000

Anyone I’ve spent time with over the past couple of months has heard me talk about “The Challenger Sale,” by Matthew Dixon and Brent Adamson of the Corporate Executive Board. I talked about their underlying research in a post last October, and have been carrying around my dog-eared and well-highlighted copy like it’s The Book of Mormon. While the research and the book focus on the broader world of sales (the empirical study included over 6,000 sellers from 60 industries), there are several insights particularly useful as we try to clarify the world of online advertising and marketing. Here’s one.

Online salespeople frequently point to the lack of product innovation as the reason they’re not making more sales. If only our product had feature X or function Y…then they’d buy from us. This can often begin a damaging cycle of rushed product improvement or feature activation which achieves only parity with some competitor’s point solution. By the time you “innovate,” either the competitor has also innovated (and pulled away) or the buyer simply moves the goal posts and tells you there’s something else wrong or deficient about your offering.

Dixon and Adamson studied this issue. They wanted to find out what drove real customer buying loyalty in B2B environments like ours. “Product and Service Delivery” — which includes the feature sets of your products — accounted for just 19% of customer loyalty. (And to those of you who think it must then be all about price, think again. “Value-t0-price ratio” drove just 9% of customer loyalty.) The reason why our “New and Improved” products don’t engender loyalty? Customers just aren’t focused on the details in the first place. “Over and over we found that customers, generally speaking, see significantly less difference between us and the competition than we do ourselves,” they write. “So while we spend much of our time emphasizing subtle differences, customers tend to focus first on the general similarities.”

So trying to win long term loyalty through product innovation turns out to be fool’s errand. Turns out that our customers are often just playing along with our own obsession with feature comparison. So then how does one create a sustainable loyalty advantage? Through sales process innovation. 53% of customer loyalty can be traced back to “Sales Experience.” Specifically, suppliers who consistently made some combination of seven moves pushed loyalty numbers through the roof (italics are mine):

Offer unique, valuable perspectives on the market
Help the customer navigate alternatives
Provide ongoing advice or consultation
Help the customer avoid potential land mines
Educate the customer on new issues and outcomes
Is easy to buy from
Has widespread support across the customer organization

Dixon and Adamson put it very succinctly: “Loyalty is won out in the field.” Customers are telling us that how you sell is quite often more important than what you sell. The natural inclination in almost every field of endeavor is for sellers to immediately say “Well, that can’t be true for our business!” I beg you to reconsider: it’s absolutely true for our business, and those who fail to reinvent their sales process accordingly will find themselves forever nibbling on the edges of commoditization.