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Martin Smith is the vice president of development at TruEffect. Smith’s career in direct and interactive marketing spans more than 23 years; at TruEffect, he focuses on developing new initiatives and forging partnerships that will create value for the company.
Most recently, he led direct marketing efforts at Apple Computer’s Online Store.

Other successes include the development of card/barcode based retail loyalty programs for Clarks Shoes, census-based applied analytics for National Westminster Bank, circulation/merchandise decision-support systems for technology reseller Zones Inc., and global integrated CRM systems for Procter & Gamble.

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Overthrow Workflow’s Tyranny, See 400% Performance Lift

Written on
August 4th 2008
Author
by Martin Smith  |
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tightrope.jpgADOTAS EXCLUSIVE — Having migrated into the online space from a career in direct response and CRM, I am acutely attuned to comprehending the balance between message and audience.

When I taught direct marketing courses it was always interesting for me to see students’ reactions when they realized the largest lift in response comes from tuning audience and timing over creative and offer. However it is also true that in the agency-client discussion the audience/timing element always came long after the extensive discussions on message, position and alignment to brand. In the online world this legacy has remained relatively intact, which is ironic because the Internet is the best medium to tune across all the dimensions of relevance and resonance.

One of the biggest culprits for this, and a reason why advertisers are leaving money on the table, is the tyranny of the workflow and the cost of origination. As the audience/timing protagonist in this discussion, I’m saddened to see scope reduced because of a lack of resources to manage campaigns. Some of this lies at a system level and some at resource expense and availability.

One answer to this dilemma has been the steady migration by many agencies to outsource versioning and ad trafficking. I am not wildly enthusiastic about this trend for two reasons:

First, it seems to resemble trends in the CRM outsource activities. Outsourcing lowers cost by reducing workflow overhead but it doesn’t address the upside in the equation and the same upside dollars are being left on the table. This takes investment in personnel who understand how to extract meaning from the media data, and then interpret and apply it to create marketing opportunities. By outsourcing elements of the activity it seems that too often the stewardship of utilizing the data is lost, though sometimes it was never there to begin with. In the CRM space, almost every year there seems to be a study finding that while there have been improvements in the technology and cost management there is still a failing to derive the key business value. It seems that in the current workflow model we may be able to produce more for less, but what is being produced can be of marginal value.

Second, what we are choosing to outsource is legacy technology rather than improvements to workflow. Ad servers often sees this on a daily basis when comparing load times and system flexibility of ASP to hybrid applications. When you can load 2,000 creatives in less than two minutes and create 30,000 row schedules in less than one minute, how much do you need to focus on outsourcing and the data that’s produced? Similarly, with micro-origination solutions, many thousands of units can be auto-created in less time than it takes to read this article.

By solving both issues technically we can then make sure we are drilling in on the data, because the same tools provide better optimization — such as updating hourly rather than daily performance. (Simple results such as intra-optimization produce significant lift 30%-50% over a 30-day period). Other aspects include better targeting data which can produce a 300%-400% lift, while message optimization can add further improvements.

It seems no one is happy with the cost it takes to manage online media. Outsourcing is certainly one alternative. However in managing the operational costs we need to make sure that we are not ignoring the opportunity to grow top-line — that takes investment in people that understand data.



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