While many a book has been published on “Internet + transition”, none so far has discussed from the perspective of digital marketing strategy, which has been a demand of a large number of consulting clients — CEOs and CMOs — and that is the very reason that my partners and I wanted to write this book.
Digital Revolution, More of a Thinking Revolution
Redefining “digital marketing strategic methodology” seems to be a responsibility and a mission, which makes us ecstatic. A recent KMG survey targeted at CEOs and CMOs shows that 81% of the enterprises believe that digital marketing is the key to their digital transition; 68% of the enterprises claim that they have no systematic digital marketing strategies; more importantly, 58% of the enterprises claim that digital marketing performance has not achieved its due expectations. Just like what has been written in Good Strategy, Bad Strategy by Richard Rumelt, perhaps no one would deny not having strategies, but one’s strategies may not be good. When we spoke with the marketing decision-makers, we found that the core problem is a lack of strategic thinking or a lack of good strategic thinking. Digital marketing is definitely not the low-level combination or a simple composition of different tools such as WeChat, microblog, Facebook, demand-side platforms (DSP) and location-based services (LBS). In the field of human conflict, firearms have always been the “tools” of generals. The more critical is the “art of military” on the battlefield recognized at home and abroad, from The Art of War by Sun Tzu
From our consulting experience, CEOs, CMOs and other senior executives pondered over the following questions:
• How to combine digital marketing and the Internet+ strategy of the company? What role does digital marketing strategy play in the overall digital strategy?
• Does digital marketing strategy upgrade brands and channels or overturn the whole marketing model?
• Compared with traditional marketing, what has changed and what remains unchanged for digital marketing in strategies?
• How to combine marketing and data? In what aspects?
• How to build brands in the digital era? Any efficient ways to build “fast brands”?
• Is it necessary to build new marketing organizations? If yes, how?
• Digital marketing is known to be ROI traceable. How could senior executives measure the performance of digital marketing? …
Questions are the best nutrients. Based on questions faced by business executives and the experience and feedbacks we obtained from consulting cases, we have structured a way to upgrade the marketing strategy from systematic theories to practical tools in the digital era. First let us return to the essence of issues. We believe that, regardless of how marketing changes, three key points will always prevail, namely demand management, building differentiated value and building a basis for continuous trading. Whether we are in the traditional age or the digital era, these three factors remain the target of marketing strategies or market strategies.
After defining the unchanged, we then talk about changes or “the core of cores in changes”, the “essence of digitalized marketing” discussed in Chapter 2. People may use similar tools but come up with completely different results. In many cases, it is due to the fact that these digital tools have not been targeted at “essence”. We believe that the following five factors can be relied on to determine whether this marketing strategy truly realizes “digitalization”: connection, bit-consumer, data talking, engagement and dynamic improvement. Mobile Internet and the Internet of Things make an instant connection and continuous connection between people and people, people and products and people and information possible. This high connectivity produces traceable data paths, turns consumers into bits, demonstrates every link in marketing by data talking, realizes consumer engagement in connectivity and achieves dynamic improvement. All of these were unthinkable before the digital age.
With all these five factors pieced together, we can say that marketing in the digital age can truly realize synchronizing customer value management (SCVM). As a revolutionary marketing paradigm after CRM, the core concept of SCVM is to coordinate and organize all departments to realize close-loop value management and value-added management of customers based on customers’ full life cycle. In the digital age, because of scenario-based consumption activities, consolidation of various channels, integration of services and products, and real-time communication for brands, enterprises must integrate research and development (R&D), marketing, sales and service, driving sales and profits with customer value at the core.
Among these, all-round insight and full life cycle management of customers have become the key factors. Acquiring more premium clients, increasing customers’ share of wallet and improving customer lifetime value are specific ways of realizing performance growth. In the past, marketing decisions and data about customers were separately stored in different brand units, channel departments and regional marketing agencies, which means that enterprises lacked concentrated data management and all-round customer perspective. Therefore, they could not have had in-depth insight into customers, increased lifetime value of customers, expanded wallet share and achieved cross- and up-selling. Now, SCVM has addressed these marketing challenges: by setting up a CMO-led marketing organization of “customer value center” and by making use of marketing collaboration platforms and centralized data warehouses of customers, enterprises can manage and analyze scattered customer knowledge and data at the organization level, and all brands and channels, based on needs, can obtain and analyze data to support its marketing activities. The integration framework of SCVM is simplified as follows: customer data platform — digging business opportunities — contact management — insight engines — customized content — interaction and distribution — multimodal collaboration — marketing control board. In the SCVM marketing system, enterprises, in a centralized and flexible way, can identify and further explore customers’ value across departments, channels and brands.
From Changing Strategic Thinking to Implementing Them
Based on changed thinking, let us analyze how they can be implemented. My partners and I divide the implementation system into two levels: One is called the “digital marketing strategy mode and its implementation system” and the other is “digital marketing supporting system”.
In this first system, we discuss how to upgrade the previous marketing strategy, “STP+4P”. For example, production strategies have gone the co-creation way; price strategies have become dynamic and based on scenarios are free of charge; the boundary between physical and virtual channels has disappeared because of digitalization and the integration of multiple channels has become the key; placement strategies like brand value concept, real-time bidding (RTB), data management platforms (DMP) and DSP have sprung up. In the book, we discuss changes from more than 30 dimensions.
On this basis, we put forward the marketing implementation framework of the digitalized strategic platform, summarized as the 4Rs as follows:
• Recognize is the first step. In the pre-digital age, we talked about the overall analysis of target consumers by sample estimation and qualitative study. In the digital age, the biggest change lies in the capability of tracking network behaviors using big data, such as tracing cookies, tracing mobile digital behaviors using software development kits (SDK) and tracing shopping preferences by payment data. When these tracking results are connected, a user profile based on big data can be produced. The integration of these technological means and marketing thinking are the biggest change in the digital age. Here, we will introduce methods, cases and practices that are being followed in China.
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