For marketers that operate in a distributed or local marketing environment (such as a national brand with a localized or distributed presence) , traditional media has played a critical role in brand strategy for decades – but digital, not so much. Nobody knows the customer better than local marketers. Unfortunately, local marketers rarely have the resources to execute digital campaigns effectively – and when they do, they run the risk of violating brand compliance if they fail to comply with corporate-approved processes and brand standards. These days it’s not enough to blast generic communications out to your target audience. You must reach them with relevant and personalized communications that build intimate relationships. You need a digital strategy for local engagement; the challenge is making it scalable.
Relationships are the key to maximizing the lifetime value of customers and growing share of wallet. It’s hard enough to manage multi-channel execution when a single corporate marketing entity oversees all marketing communications and customer engagement. But in a distributed or localized marketing function the national brand is owned by two constituents that, at times, have conflicting objectives for the brand: corporate marketing and local/field marketers. Corporate marketing is responsible for brand consistency while local marketers demand customization and autonomy in how the brand is represented to local target audiences.
In the recently published Deep Dive “Scaling Digital Marketing to the Local Level“, Gleanster revealed that the average click-through rate on generic mass email campaigns is now less than 1%, down from 3% just three years ago. In fact, Top Performers who engage in localized marketing communications (owned and executed by local marketers) report an average open rate of 17% and an average click-through rate of 5% from localized email campaigns to opt-in customer lists. That’s three times higher than generic communications from corporate marketing. Digital channels continue to deliver 3-5x higher engagement than traditional media. However, unlike traditional media, digital marketing is prone to large variances in performance, largely depending on the quality and timeliness of the communication. Traditional channels tend to be more predictable, which is one of the main reasons local marketers are reluctant to move to digital. The challenge is finding ways to make this highly personalized digital engagement scalable.
What Makes Digital Engagement Critical to Local Success?
Personalization is a byproduct of reaching customers through contextually relevant, timely, and engaging communications. Historically, local marketers relied on traditional forms of media such as newspapers, yellow pages, radio, or television. While these channels offer fairly predictable returns, they also tend to deliver lower results than digital channels. In digital channels, you can pay for behavior that physically drives sales (cost-per-click, cost-per-conversion, etc.) which means customer engagement with the brand can be directly attributed to the sale. Digital is a more reliable source of justifiable spend because it can be measured. Furthermore, customers expect to interact with brands on their terms, wherever and whenever they choose; smartphones and tablets continue to liberate information consumption and empower consumers. Digital is at the heart of these trends. As a result, digital engagement at the local level is essential to the national brand because it’s the most intimate form of communication that can be directly tied to behavior that is known to drive sales. Data from survey respondents supports this trend. It turns out, a combination of both offline and online engagement delivers optimal performance across a variety of key performance indicators.
Performance in Key Metrics Based on Reported Use of Marketing Channels at the Local Level (All Respondents, Q4 2013 Distributed Marketing Survey n=204)
Key takeaways from the data include the fact that organizations that rely exclusively on digital versus offline achieved 2.4x higher revenue growth from 2012 to 2013. A core focus on digital seems to lead to more effective execution and therefore higher performance. Additionally, the use of both digital and offline channels at the local level contributes to the highest growth in revenue at 55% average growth suggesting a combination of digital and traditional media delivers the best results. Likewise the use of both channels delivered a 26% increase in customer satisfaction an area that is traditionally difficult to impact. Marketers reported a significant decrease in the cost-per-sale through digital channels (-4%) with a modest 10% YoY increase in marketing spend. This could be a result of diminishing effectiveness from digital spend from the sheer volume of marketing messages in this channel. Alternatively, marketers that relied exclusively on offline channels reported a 6% increase in the cost-per-sale, suggesting that traditional media prices are rising but performance remains the same.
How Do You Scale Digital Marketing at the Local Level?
Technology plays a critical role in helping make digital marketing scalable at the local level. Eight out of ten distributed marketers Gleanster surveyed relied on a centralized campaign management tool that was owned and managed exclusively by corporate marketing. A single centralized corporate communication platform means local marketers must submit campaigns for corporate to configure and execute. But this can lead to bottlenecks within corporate marketing, impeding the likelihood that local campaigns executed by corporate will be relevant or timely. But, marketing technology for distributed marketers has evolved considerably over the last decade. For the first time, distributed organizations have access to tools that are specifically designed to help corporate marketing extend brand-compliant strategy, creative, and campaign execution systematically to mitigate constraints in local marketing resources or skillsets. Local marketing automation solutions provide role-based security so local marketers only see customers and capabilities they are supposed to have access to. The tools provide a scalable infrastructure for creating templates for local marketers and some solutions allow local marketers to subscribe to campaigns that are executed by the national brand. For example, local marketers could opt in to a birthday email campaign that corporate marketing automatically executes for local markets in real time, on a monthly or daily basis.
How Local Marketing Automation Technology Benefits Corporate and Local Marketers… Simultaneously
To learn more check out the Deep Dive: Scaling Digital Marketing at the Local Level