Chapter 5 Marketing

What is customer relationship management (CRM)?

The systematic tracking of customer preferences and behaviors so a company can tailor its value proposition to each customer's wants and needs.

How does CRM improve a company's long-term success?

It helps the company build stronger relationships, improve customer experiences, increase satisfaction, retain customers, and earn more profit over time.

What is MarTech?

The blending of marketing and technology.

What does a chief customer officer (CCO) focus on?

Managing and improving the overall customer experience and customer relationships.

What are the four steps of one-to-one marketing, in order?

1. Identify customers in detail. 2. Differentiate them by needs and value. 3. Interact with them efficiently and effectively. 4. Customize part of the product or service.

What is a customer touchpoint?

Any point at which a customer interacts with a company, such as a purchase, website visit, delivery update, email, or service call.

What is marketing automation?

Systems and technologies that use preset rules to handle marketing processes without constant human intervention.

What is a lead?

A person or organization with a potential interest in buying a product.

What is a sales funnel?

The process through which a company finds, qualifies, and sells its products to buyers.

What is lead nurturing?

Sending relevant content to a prospect to build interest and move the prospect toward a purchase.

How can CRM connect a company with customers?

It uses customer information to personalize communication, recommendations, products, and experiences.

What are marketing metrics?

Measurements or scorecards used to evaluate the effectiveness of marketing strategies and tactics.

What is marketing control?

The ability to identify positive or negative differences from expected performance as soon as they occur.

What does SMART mean when setting a goal?

Specific, measurable, achievable, relevant, and time-bound.

What three broad kinds of CRM metrics can a company track?

User adoption metrics, customer perception metrics, and business performance metrics.

What is customer acquisition cost?

The average cost of gaining a new customer.

What is customer lifetime value (CLV)?

The expected total value or profit a customer provides throughout the relationship with a company.

What is conversion rate?

The percentage of prospects or visitors who complete a desired action, such as making a purchase.

What is customer churn rate?

The percentage of customers who stop doing business with a company during a period.

What is net promoter score (NPS)?

A measure of how likely customers are to recommend a company, product, or service.

What is structured data? Give examples.

Data organized in a defined, searchable format. Examples include dates, times, census data, and Instagram likes.

What is unstructured data? Give examples.

Data that does not follow a fixed organizational format. Examples include email bodies, X posts, Facebook status messages, and video transcripts.

What is Big Data?

Very large and rapidly growing collections of structured and unstructured data that are difficult to process with traditional database methods.

What is the Internet of Things (IoT)?

Ordinary objects connected to the Internet that collect and communicate information about how they are used.

What are three ways Big Data can create a competitive advantage?

It can reveal opportunities for greater ROMI, support better products, and deliver timely information more efficiently and effectively.

What are the five major source categories of Big Data for marketers?

Social media, corporate IT systems, government and NGOs, commercial entities, and partner databases.

What is web scraping?

Using technology to collect data from websites for analysis.

What is sentiment analysis?

Measuring attitudes toward a brand by analyzing the context or emotion in online comments.

What is brand mapping?

Analyzing online conversations and associations to understand how consumers perceive a brand and how it relates to competitors or ideas.

What are common corporate IT data sources?

CRM databases, web analytics databases, enterprise resource planning databases, and accounting databases.

How can government and NGO data help marketers?

Public sources such as census data help marketers understand populations, markets, and trends.

What are commercial entity data sources?

Data collected in large quantities by companies and sold to other organizations, often in aggregate form, such as credit card or scanner data.

What are partner database sources?

Two-way information exchanges between a purchasing organization and its suppliers.

What benefits can partner databases provide?

Real-time demand signals, better inventory decisions, and fewer stock-outs.

What is data mining?

The process of analyzing Big Data to identify unique patterns of behavior and useful relationships.

What is market basket analysis?

A data-mining method that identifies products customers tend to purchase together.

What four marketing purposes can data mining support?

Market basket analysis, customer acquisition, customer retention and loyalty, and identifying customer abandonment.

What is a data warehouse?

A centralized system used to store and process large amounts of data.

What is information overload?

A condition in which the amount of data is so large that deciding what information is useful becomes difficult or paralyzing.

What does a data scientist do?

Uses skills such as mathematics, computer science, and trend analysis to search across data sources and turn data into useful insights.

What is augmented intelligence?

Technology designed to improve human abilities and efficiency by helping people make better decisions, rather than merely replacing them.

What is a deepfake?

A realistic-looking image or video that falsely shows a person doing or saying something that did not happen.

What major ethical and security risks come with Big Data?

Cyberattacks, hackers, data breaches, privacy concerns, misinformation, and misuse of personal information.

What is blockchain?

A database distributed across multiple computers in which linked blocks of data are designed not to be altered.

How can blockchain help with Big Data?

It helps assure data integrity by making stored records difficult to alter.

What is marketing analytics?

Technologies and processes that allow marketers to collect, measure, analyze, and evaluate the effectiveness of marketing efforts.

What is the relationship between Big Data, data mining, and marketing analytics?

Big Data supplies the information, data mining finds patterns in it, and marketing analytics turns the findings into marketing measurements and decisions.

HIGH PRIORITY: Why is digital marketing easier to measure than traditional marketing?

Consumer actions such as clicks, views, purchases, and responses can be tracked directly and connected to specific campaigns and channels.

HIGH PRIORITY: What is an A/B test?

An experiment that changes one characteristic of a marketing program, such as a web page or email, and compares the results with another version.

Why should an A/B test change only one characteristic at a time?

Changing one feature isolates its effect, making it clearer what caused any difference in performance.

What is an omnichannel media user?

A consumer who interacts with content and brands across multiple connected digital and traditional channels.

What are the six major digital marketing channels in Figure 5.7?

Video marketing, personalized email, content marketing, social media, search engines, and digital advertising networks.

What is ROI?

Return on investment, a comparison of the financial return from an activity with the amount invested in it.

What is ROX?

Return on experience, a measure of the value created by improving the customer's experience.

What is cost-per-click pricing?

The advertiser pays when a consumer clicks the ad.

What is cost-per-impression pricing?

The advertiser pays each time the ad is displayed on a page viewed by a user.

HIGH PRIORITY: What is search engine optimization (SEO)?

Techniques used to help a website rank highly in unpaid search-engine results.

HIGH PRIORITY: How does marketing analytics create accountability across digital channels?

It measures each channel's results and compares the average value of a customer transaction with the average cost of acquiring that transaction.

HIGH PRIORITY: What is the formula for average customer transaction?

Total sales attributed to the channel divided by the total number of customers acquired through that channel.

HIGH PRIORITY: What is the formula for average cost per customer transaction?

Total spending attributed to the channel divided by the total number of customers acquired through that channel.

HIGH PRIORITY: What is the formula for the average value of a digital marketing channel investment?

Average customer transaction minus average cost per customer transaction.

HIGH PRIORITY: In Table 5.3, what are the banner-ad results?

Average transaction: $450,000 / 10,000 = $45. Average cost: $100,000 / 10,000 = $10. Average channel value: $45 - $10 = $35.

HIGH PRIORITY: In Table 5.3, what are the Instagram-ad results?

Average transaction: $1,200,000 / 15,000 = $80. Average cost: $240,000 / 15,000 = $16. Average channel value: $80 - $16 = $64.

HIGH PRIORITY: In Table 5.3, what are the SEO results?

Average transaction: $2,100,000 / 40,000 = $52.50. Average cost: $200,000 / 40,000 = $5. Average channel value: $52.50 - $5 = $47.50.

HIGH PRIORITY: According to Table 5.3, which channel has the greatest average value?

Instagram ads, with an average value of $64 per customer transaction.

HIGH PRIORITY: What are the combined results across all channels in Table 5.3?

Average transaction: $57.69. Average cost: $8.31. Average channel value: $49.38.

How can marketers track the results of nondigital campaigns such as direct mail?

Use a unique URL, landing page, promotional code, QR code, or phone number that is connected only to that campaign.

What do marketing metrics tell marketers?

They describe and help marketers understand current performance.

HIGH PRIORITY: What is predictive analytics?

The use of large quantities of data to predict the likely success of future marketing actions or other future outcomes.

HIGH PRIORITY: How does predictive analytics differ from ordinary marketing metrics?

Marketing metrics describe current or past performance, while predictive analytics forecasts future behavior and results.

HIGH PRIORITY: What is anticipatory shipping?

An AI-based, data-driven approach that predicts what a customer will purchase and supports shipping decisions before the purchase is fully finalized.

How can a personal career database help with Brand You?

It organizes contacts and relationship information to support networking, contact acquisition, retention, and personalized follow-up throughout a career.

How should someone maintain relationships in a personal career database?

Stay top of mind by regularly sending contacts something relevant or valuable.