Wednesday, April 15, 2015

Culture, Mindset, Analytics and Nonprofits

A recent article heralded the halo effect of advertising, but the almost impossible task of measuring the effectiveness of traditional advertising means any probable halo effect is more attributable to marketing.

This is because marketing is a blend of various communication activities, only one of which is advertising, and less and less of that is traditional advertising which experts now find has an overall negative return on investment.

It is this blend, when customized to each organization, that creates a synergy transcendent of any of its elements.

Unfortunately, a survey released this month shows that less than a third of marketers (32%) put data and metrics “at the heart of their strategic decision-making.

What is disturbing about that finding is that data-driven marketing is nothing new.  By the early 1980s, it had found its way to the core of a small nonprofit community marketing organization I led.

Granted, I was an “early adopter,” as I still was in 1989 with similar startup with which I was involved.

But seeing how quickly this approach enabled early adopters to leapfrog more established competitors, one would expect it to be more mainstream by now.

Studies pinpoint that the reason so many marketers remain mired so far in the past is because of they lack a strategic mindset even though recruiters for top marketing positions now find that attribute, along with analytic skills, more important for marketing leadership than creativity.

A study conducted in 2012, long after I retired from four decades in the field of community marketing, showed that the nonprofit sector in the U.S. had grown 3.5 times the rate of the for-profit sector.

Fast Company magazine surveyed their ten most innovative companies in not-for-profit recently to ascertain what talents and skills will be in most demand in this sector over the next five years.

Top are data-savvy skills.  Next come design skills.

Those, along with technology were at the core of my last non-profit startup 26 years ago.  I don’t say that to gloat but out of puzzlement. We couldn’t have been three decades ahead.  Really!

If I stumbled into those competitive advantages so long ago, how is it that so many of my former peers across the country apparently still don’t get it or is it?  Or maybe its that their governing boards don’t get it?

Survey results show that 96% of marketers today know that data is important or very important including 9-out-of-10 in senior management but as the authors point out, that is very different than knowing how to collect, manage, analyze and utilize it.

Telling is that fewer than half of marketing organizations give more than half of their own employees access to their data.

This is why so many go to the trouble of contracting analysis to show how effective their marketing strategies are, known as the “turn-on” ratio.

However, they nearly always fail to measure the equally significant “turn-off” ratio such as when their ads are merely a form of yelling or placed in the wrong context such as on billboards where they are associated with desecration.

Even Super Bowl ads have a 5-to-1 turn-off to turn-on ratio, further illustrating that less than a third of marketers have data and analytics at the heart of strategic decisions.

Marketers will be in high demand if they have a strategic mindset, understand analytics and design and recognize that marketing is not only about “turning-on” consumers but minimizing “turn-off.”

The president of the Rockefeller Foundation is quoted as saying that nonprofits in general are projected to continue to hire more talent than the for-profit sector over at least the next five years.

Silverpop, an IBM company, has just published an ebook entitled, The New CMO Guide – A Handbook for Marketing Leaders.  This is also an example of content marketing, a form of advertising that has replaced traditional advertising.

The authors note research showing that 82% of marketers feel unprepared to deal with the data explosion.  In part, this is why the average tenure for chief marketing officers is now only 48 months.

Even more so, this may also explain why, according to Spencer Stuart, this tenure was less than 24 months just a decade ago when the importance of data belatedly began to dawn on marketers.

But especially in the field of community marketing, hiring a chief executive with a strategic mindset who understands analytics isn’t enough.

It is an organization’s culture that makes all the difference and sets the tone for “innovation, growth, market leadership, ethical behavior and customer satisfaction,” according to a new white paper published by Spencer Stuart, also a form of content marketing.

It was management guru Peter Drucker who originally discussed that “Culture eats strategy for breakfast,” later modified by others as “Culture eats strategy for lunch.”

But Drucker wasn’t referring to a document as much as the strategic mindset.

Culture in the organizational sense is what Dr. Kelly Page of NativeHQ refers to as “an iterative process over time that we enact, guided by vision and values forged through conversation and collaboration…our individual and collective voice over time.”

Shawn Parr, head of Bulldog Drummond, encourages us to view an organization’s culture as a “nurturing habitat for success.”

He continues that “Cultural cannot be manufactured;  It has to be genuinely nurtured by everyone from the CEO down.  Ignoring the health of your culture is like letting aquarium water get dirty.

A shared culture creates critical alignment.  And that alignment must also include each and every member of an organization’s governing board.

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