The goal of all marketing is to create unfair advantage. In digital marketing, advantage comes from being in the right place, at the right time, with the right message. Unfair advantage comes from a defensible custom process that creates advantage in place, time or message. An unfair advantage cannot be copied, bought, or replicated and like all secrets, it ages poorly. An unfair advantage cannot come from commercial tools because your competitor can buy the same product, take the same training, and your advantage disappears. An unfair advantage cannot be discovered in an article, study, or white paper because your competitor has access to the same knowledge. An unfair advantage is fleeting because once discovered by your competitor it vanishes. An unfair advantage has a limited lifespan and businesses must continue to invest in “What’s Next” to create, or maintain the next unfair advantage.
Over the last 46 years I have been a soldier, programmer, and digital marketing executive. My professional career started with 7 years in the US Army, which taught me leadership, tactics, and strategy. Followed by school and 16 years in custom software development. I was rapidly promoted from Programmer, to Systems Analyst, to Project Manager, to Executive Management, ultimately becoming the CEO. This was followed by 23 years as Digital Marketing Agency CEO in a business that morphed primary focus from SEO to PPC. I have always been attracted to the impossible problem of marketing and my teams were always staffed with smart and independent thinkers. I live by the rule of never working with someone who is not better than myself at what they do. I believe that team diversity brings strength and perspective to the team. With my recent retirement as CEO, I have moved to the role of Senior Data Scientist and I now have the freedom to work on the projects I love with people I deeply respect. My new life mission is to create experiments to discover patterns and relationships in marketing data that can be leveraged into unfair advantage for our clients.
Finding Clients with Strategic Synergy
To accomplish this, my first task is to find clients with whom we have a strategic synergy. To be a reasonable fit the client must be reasonably sized (minimum monthly ad spend of $25K) with a professional marketing management team in place that understands and appreciates the complexity and business opportunity value in programmatic digital marketing. Of the active clients that I managed as CEO of SMS we have had probably a dozen clients that fit this profile. Indeed, they are the top 1% of their industry and intend to continue that position.
Profiling one of our large clients, they manage over $100k a month in PPC for 30+ locations providing a home service that includes repair, service, and installation for both residential and commercial customers. As a professionally managed business they are active in all channels of marketing including digital and conventional advertising and PR. The manager is brilliant and understands the business to a level that nobody outside their industry will ever reach. He understands the complexity and tradeoffs involved in marketing and is willing to test new concepts under a fail-early strategy. I have met with this manager every week for the last 8 years so I know that his account has no fundamental problems left but he also knows that the improvement opportunity is huge. If we could accomplish the impossible of perfect timing, placement, and message the improvement would be 96%. With an annual budget of $1.6 million this approaches a business value of almost $50 million in business opportunity. Perfect marketing is a lofty goal but it is not realistic, however there is always room for improvement. If we can improve this account, moving the success rate from a typical 2% to 4%, the business value of that is $1.6 million! We just need to improve the system by 2%.
Why this must be a custom solution
If it’s not custom then it cannot be protected and the advantage will be lost as the market adopts the new best practice. There is an industry full of developers creating commercial products to the largest possible audience. This is how they create leverage and how they monetize the technology. Look at product like WordStream, Marin Software, Kenshoo, Optmyzr, and all their cousins. These are great products, but they are general use designed to fit the largest possible audience. They create advantage only until your competitor buys the same product or a better one. Custom solutions are perfectly fitted to the specific business with no compromise in the process. Tool developers are rarely experts in the industry, they write code for. Custom solutions take time and money to create and this creates a barrier to the competition as does protecting it as a trade secret.
The Digital Marketing Trifecta – Place, Time, and Message
Aligning three elements is an advertising utopia and perfection is impossible. However, improvement is certainly possible. When you examine the simple math of aligning three variables it does not take a lot of change in a variable to improve the response. Of these three variables, the big one is time because it is within time that the demand is created. The place and message need to be on target but detecting or improving the odds of the time is where most of the opportunity exists. Time is largely created by a knowledge of the business and the events that drive it. I believe that unfair advantage will come from bringing outside data into the AdWords strategy.
The AI Path to the Solution
We believe that progress in this this will come from the AI/Machine Learning/Deep Learning field. Using the tools that are rapidly developing in this space we should be able to build models to evaluate data feeds from advertising networks, websites, and other sources to make better decisions. Considering that failure rates in advertising are often 98% there is plenty of room for massive improvement.
If you are interested in being a partner in this journey in Marketing AI please call Bob Dumouchel at 800.272.0887 or email firstname.lastname@example.org