Agile Marketing Intelligence: The Cure to Entrepreneurial Bias and Entrepreneurial Inertia

Agile Marketing Intelligence

In our last article we discussed how startups need to overcome two marketing challenges in order to succeed: Entrepreneurial Bias and Entrepreneurial Inertia. Both of these forces conspire to prevent startups from rapidly adapting to changing market conditions. We also touched upon an approach that can help startups beat these challenges: Agile Marketing Intelligence. Today we’ll describe this approach in more detail and provide you with a framework that you can apply to ensure that your startup doesn’t fall into these traps.

We defined Agile Marketing Intelligence as the art of systematically and continually gathering market feedback and iteratively formulating effective marketing strategies. This set of disciplines is related, but very different, to the practice of Agile Marketing. Agile Marketing is a tactical discipline that attempts to answer the question “What projects should my marketing team be focused on at a given point in time?” Agile Marketing Intelligence is a strategic exercise that attempts to answer the following questions:

  • Who are my best customers?
  • What do they value?
  • How do I reach more of them?
  • What should I say to convince them to buy from me?

At the heart of Agile Marketing Intelligence is the idea of having frequent, value-based conversations with your market. The outcome of these conversations are actionable insights that you can test and whose effectiveness you can measure. The iterative nature of this process, which borrows heavily from the Agile Development movement, helps ensure that your overall marketing strategy is continually aligned with shifting market realities.

So if this describes Agile Marketing Intelligence, how does one do it? Like any discipline, Agile Marketing Intelligence consists of a set of practices used to capture specific types of market feedback. Feedback is collected through a process of interviews. This feedback is then integrated to draw insights that influence marketing strategy in an ongoing manner. Here’s a short list of the different areas of focus critical to good Agile Marketing Intelligence:

  • Business challenges
  • Product usage
  • Competitors
  • Customer satisfaction

We’ll cover each of these briefly below. Before we do, we need to discuss a general best practice that applies across all of these focus areas. It’s imperative that you have more than one person participate in the review of this feedback and at least one of these people should be someone from outside your organization. Hire a consultant to help you, partner with a fellow entrepreneur at another startup, just make sure that this person is not part of your own organization. Doing so is your biggest hedge against falling into groupthink and the trap of Entrepreneurial Bias.

Business Challenges

Business Challenges

Business challenges are the most important focus area for startups. They are also often the least used tool in the Agile Marketing Intelligence toolkit. It’s easy to understand why. Most of the time when we interview customers we want to know what they think about our product or service. While this information is critical to improving an existing product, it does little to help us discover new opportunities or adjust to changing marketing conditions. It also does very little to help us understand how customers think, view the world and the language that they use to express these realities.

By understanding a customer’s business challenges you unlock all these valuable nuggets of intelligence. You understand what’s causing them pain, what that pain looks, feels and sounds like, and you can begin to formulate a plan about what you intend to do about it. Business challenge questions are best conducted live, via video chat or phone. This gives you the opportunity to adjust the focus and direction of the interview in real-time based on what your customers are telling you. So what does a business challenge question look like? Here’s an example that you can use early in your interview process:

So <<customer first name>>, thanks for making some time for me. Tell me, what’s keeping you up at night lately as it relates to your business? I’d really like to know.

What, if anything, exciting is going on with your business?

By asking these types of questions and following up with the right open-ended follow-up questions, you get a window into what matters most to these clients. As you collect data and begin to see patterns, you can begin to confirm these patterns by having more directed conversations with customers. For example, you may tailor your questioning as follows after identifying a pattern of responses:

Hi <<customer first name>>, thanks for making some time for me. We’ve been getting some interesting feedback from some of our other customers about their business challenges that I wanted to run by you. We’ve heard <<insert observation here>>. What do you think?

Listen to their responses and make sure that you ask plenty of open-ended follow-up questions to make sure that you clearly understand what they mean. If you’re interested in a couple of examples of open-ended follow-up questions, here are two that work pretty well:

What do you mean by <<term or expression>>?

Can you provide me with an example of what you mean?

The most important rule of interviewing, whether it’s Business Challenge interviews or other types of interviews, is this. Never assume that you understand what someone meant by what they said. If there’s any doubt whatsoever in your mind, ask an opened-ended follow-up question until you completely understand their meaning.

Product Usage

Product Usage

Product usage is a focus area the seeks to understand what users like and dislike about your current offering and what, if anything, they feel is missing. It is the most commonly practiced focus area. But just like any other tool, if it’s applied in the wrong situation it will fail to deliver results. So it’s important that you seek product usage feedback at the right time and for the right reasons. Product usage intelligence will help you refine the existing value proposition of your offering. It will not help you discover and deliver new value. It’s a tool that can deliver incremental improvements, not revolutionary ones. Since most startups are in the business of delivering disruptive value propositions to their markets, product usage activity should at most represent 25% of your Agile Marketing Intelligence portfolio. If you’re spending more time than that, you may find yourself grossly misaligned with your market or leapfrogged by a competitor.

Another common mistake that most startups make is relying exclusively on direct customer feedback. Startups should blend qualitative customer feedback with quantitative data analytics in order to achieve the best results. There are a variety of tools available that enable you to collect and analyze product usage data. Here’s a short list:

Google Analytics

Google Analytics

For web-based offerings and cash-strapped startups, nothing beats this powerful and free tool. You can use it to identify problem areas and also to identify where customers spend most of their time in your solution.

Flurry

Yahoo Flurry

Flurry is the mobile analytics platform offered by Yahoo. It’s chockful of lots of advanced features like funnels, segments, and cohorts. Best of all, it’s free.

Mixpanel

Mixpanel

If you’re looking at tracking product usage across web and mobile, Mixpanel is a great choice. It’s freemium pricing model is perfect for startups, with the option to scale into more powerful paid plans as your business grows.

Competitors

Competitors

Competition is inevitable, and gathering intelligence on your competitors on an ongoing basis will be critical to your startup’s success for two reasons. As competitors adapt and adjust to changing market conditions, they often highlight value propositions that you might otherwise have missed. This gives you the opportunity to catch up in an area before it becomes problematic. Competitor intelligence is also crucial to your sales process. Arming your sales team with the right information at the right time may mean the difference between success and failure. Here are three things that you can do to make sure that you stay on top of the competition:

Google Alerts

Google Alerts

Setting up a Google Alert for each of your competitors is a quick, easy and free way to keep tabs on them.

Follow Competitors on Social Media

Social Media

Another great source of competitors intelligence is social media. Brands are more active than ever getting their message out on these platforms. A free and easy way to keep tabs on the competition is by simply following competitors on social media networks like Facebook, LinkedIn and Twitter.

Agora Pulse

Agora Pulse

What brands share on social media is only a small part of the value that these networks can provide to your competitor intelligence efforts. The much bigger and more valuable part is what their customers have to say about them. Social media tracking tools like Agora Pulse are a great way to keep track of these trends. Agora Pulse has plans starting at $49/month, which is a deal when you consider that you can also use it to track your own social media performance and compare it to your competitors.

Competitive Analysis / Secret Shopping

DBS Marketing

Sometimes the best way to get an in-depth understanding of your competitor’s strengths and weaknesses is through a formal competitive analysis project. This type of research is the most expensive, but often yields the deepest insights across the entire customer lifecycle. It’s also best to have a third party conduct these for you, in order to eliminate the risk of Entrepreneurial Bias. My firm DBS Marketing specializes in this type of research. Contact us for more information on how we can help.

Customer Satisfaction

Customer Satisfaction

Customer satisfaction intelligence is the last focus area we’ll be covering, and an important complement to the product usage focus area. Product usage is only one element of many that shape your brand experience. Other factors that contribute to your brand experience include sales, support and billing interactions. Customer satisfaction intelligence delivers the insights that enable you to understand why customers feel the way that they do about your brand across all these areas. This enables you to discover who your best customers are and why, identify problem areas, and quickly course correct to improve your brand experience. It also helps improve your overall marketing efficiency. Word of mouth is a powerful amplifier for your marketing messages, so the happier your customers are the more likely they are to recommend you and support your marketing messages.

There is no better methodology for capturing customer satisfaction data than Net Promoter Score. It’s not only been proven to correlate highly with actual customer behavior, it’s also easy to capture and make actionable. In the Net Promoter Score (NPS) methodology you ask just two questions:

  1. On a scale of 0 to 10, where 0 means “highly unlikely” and 10 means “extremely likely”, how likely are you to recommend <<product or service>> to a friend or colleague?
  2. What’s the reason for your score?

Customers are then categorized according to their response to the first question as follows:

  • Score of 9-10 = Promoter
  • Score of 7-8 = Neutral
  • Score of 0-6 = Detractor

Then you simply add up the number of customers in each category and apply this formula:

(# of Promoters – # of Detractors) / Total # of Respondents

This gives you a percentile score which is called your NPS score. You can then compare your NPS score over time to track improvement over time, and you can compare your score against industry averages to see how you compare against your competitors. The goal is to outpace your industry to a significant enough degree in order to generate overwhelmingly positive word of mouth. The second question provides you with insight into why your customers scored you as they did. Finding patterns in these responses will tell you what is driving customer satisfaction up and what is driving it down.

It’s easy enough to capture NPS feedback and calculate your NPS score yourself for free in the beginning when you only have a handful of customers. Over time, you’ll want to move to a more robust NPS capture platform that automates all of the capture and analysis for you. Here’s a list of the methods that I recommend:

Email

Email

In the beginning when you have a handful of customers you can simply send them an email asking them to answer the NPS questions. Then you can pop their answers into a spreadsheet and calculate your NPS score yourself.

Google Forms

Google Forms

Once you have more than a handful of customers, you’ll want to leverage a platform like Google Forms to directly input customer responses into Google Sheets. You’ll still need to calculate your own NPS score yourself and evaluate the open-ended responses.

Promoter.io

Promoter.io

Once your startup begins to scale you’ll want to leverage a platform like Promoter.io. Promoter.io is specifically designed for NPS. It integrates and automates email delivery, data collection and advanced analysis in one easy-to-use package. And with plans starting at $50/month, it’s an extremely affordable option.

Putting It All Together

Putting the Pieces Together

So far we’ve covered the data collection and analysis process across the four major focus areas of Agile Marketing Intelligence. If you’re doing it right, then you are conducting intelligence gathering exercises in all four areas on a continuing and repeatable basis. Now it’s time to discuss how to pull this all together to deliver real value for your startup.

Just like in Agile Development and Agile Marketing, I suggest that you hold monthly or bi-weekly scrums where you discuss the insights gathered across the four focus areas. Participants should include your senior leadership team as well as the outside members that you’ve drafted onto your Agile Marketing Intelligence team (i.e. consultant or startup founder from another company). If this is your first time conducting this exercise, agree to a number of strategic story points that you team can handle during each scrum. Then as you review the strategic insights that you’ve captured prior to scrum they will fall into one of three categories:

  • Strategic insights that support your current marketing strategy.
  • Strategic insights that call your current marketing strategy into question.
  • Strategic insights that open you up to new market opportunities.

As a team discuss the pros and cons of these various insights and the strategies that they suggest, and then as a team allocate strategic story points accordingly until you run out of points. Items with a higher story point value get prioritize ahead those with a lower story point value. Items that did not get allocated story points are deferred until your next scrum. The degree to which your strategy will shift over time is inversely related to the maturity of your market. Therefore innovative startups is new disruptive markets will and should expect a high degree of strategic shifting to occur. This process ensures that those shifts happen and happen quickly, overcoming the effects of Entrepreneurial Inertia.

So here’s a quick summary of what we’ve covered:

  • Ensure that you are continually executing intelligence gathering exercises in the four focus areas of Agile Market Intelligence: business challenges, product usage, competitors and customer satisfaction.
  • Meet regularly in scrum to review your latest set of insights and adjust your strategic plan as needed to avoid Entrepreneurial Inertia.
  • Ensure outside participation in the intelligence gathering, analysis and scrum phases to help limit the effects of Entrepreneurial Bias.

I hope you found this article helpful. I’d love to hear what you think, so please take a moment to comment below. And if you need any help establishing this process for your startup, please don’t hesitate to reach out to me at [email protected].


Dave Geada, CEO DBS Marketing

About the Author

Dave Geada is the CEO of DBS Marketing, a strategic marketing consulting firm that helps startups successfully grow their businesses. He’s a marketing professional with over 15 years of technology marketing experience working with leading brands like Network Solutions, Computers Associates and Rackspace. Most recently he’s worked with local San Antonio brands like Geekdom, Codeup, BoldBrush, Pressable and Grok. You can reach Dave at [email protected].


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