Master’s Thesis Status: COMPLETED!

All 110 pages of my master’s thesis on location-based marketing were submitted to NC State’s Research Advisor for the Global Luxury Management program on Tuesday, August 30, 2016. I’m pleased to say that all of the hard work that went into preparing a project of this size paid off with a final grade of 18/20 received. One of the few criticisms received I enjoyed had a good laugh about: “Overall a good study, but the lit review read more like ad copy that an analysis of the literature.” After 10 years, I just can’t turn the copywriting mode off in my brain! 😉

I invite you read a brief synopsis of the report below and if you’re interested, request a complimentary copy of the full-text PDF at the end of this blog post. For those of you who don’t have time to read through all 100+ pages at once (and who would?), I’ll publishing smaller sections throughout 2017 here as individual posts and case studies to make it easier to digest. Stay tuned!

Location-Based Opportunities for Brand Marketing

WITH EMPHASIS ON APPLICATION WITHIN LUXURY INDUSTRIES
Lisa Jeffries | NC State University – MSc Global Luxury Management – Thesis | August 31, 2016

Keywords

Marketing, luxury marketing, retail marketing, hospitality marketing, travel marketing, tourism marketing, marketing technology, marketing strategy, location-based marketing, Bluetooth beacon, beacon, geo-fencing, point of sale systems, POS, customer relationship management systems, CRM, customer acquisition, customer retention, email marketing, loyalty marketing, social media, social media marketing, personalization, privacy, big data, luxury, luxury brands, branding, online marketing, traditional marketing

Abstract

Audiences are now more connected than ever – with no signs of slowing down their adoption rates of mobile smartphone use, e-commerce, and other digital mediums. What are the high-level technologies currently utilized in the consumer marketplace available for brands and marketers to utilize location-based marketing to reach these connected audiences? Additionally, what are the current best practices based on efforts from brands and marketing practitioners across personal, transportation, and experiential segments – with specific emphasis on luxury industries or brands, as available? Using trade media, published research, primary interviews and surveys of working professionals, as well as two real-world experiments, “Location-Based Opportunities for Brand Marketing” offers a survey of the current marketing landscape, assesses industry awareness of location-based marketing technologies and practices, and consideration of future opportunities to come. The uses of beacons, geo-fencing, mobile applications, online advertising, email marketing, point of sale and customer relationship management systems in the processes of customer acquition and customer retention are explored.

Preface

Nearly 100 pages of research, analysis, and opinions don’t come easy. As such, I would be remiss in not acknowledging and thanking the following family, friends, and colleagues for their support in this endeavor:

  • Mom and Dad: For your perpetual support of my wishes to return to graduate school at NC State University – and the four-month overseas semester at SKEMA Sophia Antipolis in France that came along with that undertaking. Mandy and Joe, as well, for your continuous encouragement along the way.
  • Johnnie Nobling: For your often-tested patience (“Did she just call you ‘patient’?”), for being a consistent source of enthusiasm and confidence in the long hours endured from the first day I stepped back on campus in August 2015, and for pushing me to not just complete this project, but to make it something I could truly be proud of creating with long-standing professional purpose.
  • My GLM (Global Luxury Management) Peers: I feel so fortunate to have formed lasting relationships with each of you during this crazy ride through grad school. Long live the Facebook messages and group texts that got us through this!
  • To the 40+ professional contacts who participated in the accompanying survey (even being so wonderful as to share it with other, too), provided resources from their own brands and publications, as well as the dozen+ generous souls who were so giving with their time and opinions to help my research efforts…
  • To NCSU Libraries staff and Amanda Elam for your incredibly professional and speedy responses for providing the resources needed to complete this thesis from the academic perspective…
  • To the numerous friends, clients, and colleagues who checked in via emails, text messages, and the like to wish me luck with the final preparation of this thesis and to provide encouragement along the way…

1,000 “THANK YOU”s would not nearly be enough gratitude for the support you’ve provided me, so I hope you all know I’m sincerely grateful for each and every one of you. And to anyone else I’ve forgotten to mention, I hope I remembered to say “Thanks!” at the time of your help.

Executive Summary

American and global consumers are more connected than ever with the potential to spend almost immediately in both brick-and-mortar and digital businesses. What are today’s opportunities for reaching them at a time when they’re considering purchasing – or even earlier, by providing the inspiration to purchase? And can be we begin to personalize on a one-on-one level, like so many luxury consumers have come to expect, to improve the return rates on investments made into new customer acquisition as well as existing customer retention and loyalty development?

Thanks to modern-day marketing technology, brands and marketers have what feels like never-ending access to generating first-party data and leveraging third-party provider systems to create and fulfill their nearly boundless imaginative ideas for bringing new customers into business doors and keeping them spending over time.

From utilizing geo-fenced advertising (that is only displayed to smartphone or web audiences who are accurately identified as being within a specific targeted location) to drive interest for a brick-and-mortar business, to using point of sale data segments defined as “at risk” to re-activate potentially valuable and nearly lost customers, in 2016 we’re beginning to scratch the surface of what it means to be able to communicate valuable messages to an increasingly connected audience.

While over 80% of respondents to the enclosed survey on location-based marketing reported having “heard of location-based marketing technologies like geofencing and beacons”, a full 50% of the same survey respondents indicated they have yet to utilize them in their businesses and brands and 15% reported being unsure if their business or brand had made use of them or not. The following research compiles the experiences of over a dozen business and marketing professionals to provide a broad look at the products and services that exist today to help brands and marketers both acquire and attain customers and clients using a technology-first, location-driven approach. As one survey respondent noted, deploying beacons and other sensors allow us to track store visits, which in turns “builds audience data for retargeting, but also measures foot traffic. The latter enables brands to measure the effectiveness of their campaigns, and attribute ad spend to more visits.” As brand marketers are continually required to justify their spending, the building of data and ability to measure effectiveness cannot be underscored.

As best practices in this space will continue to evolve alongside technology and research, I invite those interested in this topic to visit my website, Lisa-Jeffries.com, where I’ll continue to write more on the subject and welcome your comments and examples you find of real world best practices in use.

Download the Full Text

To download a complimentary copy of Location-Based Opportunities for Brand Marketing, please fill in the form below and a PDF version of the full-text report will be provided via email. Thank you for your interest my master’s thesis research!

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The Evolution of CRM

Author’s Note: Below is a short essay I submitted as part of an exam for the “Business Relationship Management” course I am currently taking as part of the NC State University Master’s of Global Luxury Management program.

Prior to the proliferation of computers, cloud-based software, and analytics in our daily working lives, CRM systems were reserved for large organizations that could afford a capital investment into the concept. “CRM Done Right” notes that “through the late 1990’s and into 2000, managers plowed millions of dollars into information systems meant to track and strengthen customer relationships.” In 2015, a subscription to the world’s #1 CRM system, Salesforce.com (according to its homepage), costs just $25.00 per month when billed annually. Even though the financial playing field for CRM systems seems to have been leveled, the primary reason for use and the potential benefits still hinge on implementation and strategy.

In “CRM Done Right” (Rigby and Ledingham), four key questions were proposed for brands to ask to decide where and how to use CRM technology:

  • “Is it strategic? (Identify the processes that most support your company’s strategy.)
  • “Where does it hurt?” (Where in your customer relationship cycle do performance-sapping problems arise?)
  • “Do we need perfect data?” (Distinguish between activities that truly demand perfect data and those that don’t.)
  • “Where do we go from here?” (Analyze system-generated data to pinpoint new opportunities to extend CRM’s power.)

Although the Harvard Business Review feature was published in 2004, and amidst all of the leaps and bounds in growth that technology has made since, the four key questions still pose a basic foundation that any brand should consider before committing the time and financial resources required to launch a CRM strategy.

According to “CRM Done Right”, “a comprehensive CRM system can, in theory, automate every aspect of a company’s relationship with its customers”. But what part of the relationship needs to – and should – be automated? (Is it strategic?) Is it potentially every interaction (for example, with an e-commerce based business) or potentially just at major pain points in the process (another example: a salon that sends text or email message based reminders for upcoming appointments rather than intrusive, labor-intensive, and more time-consuming phone calls)? (Where does it hurt?) Asking this question in advance – “which parts of our relationship can and should be automated” – indicates understanding of the best practice noted in “CRM Done Right” that “successful CRM practitioners have learned to distinguish between routine aches in the business and strategic pain points before prescribing CRM solutions.”

In solely web-based transactions, first-click or last-click attribution methods (while possibly varying in efficacy of sales conversion) are often accurate and easy to associate with a singular customer’s purchasing history and behavior, but where brick-and-mortar businesses are still concerned, even the most modern of CRM systems can still be victim to human errors and tendencies — begging the question, “how good is our data”. (Do we need perfect data?) For an example, when setting an appointment to meet with a luxury real estate agent, the agent might ask their new client: “how did you hear about my services?” – to record in their real estate agent CRM software. Even though the agent invests heavily in print advertising, outdoor/billboard campaigns, and online advertising, the client might erroneously credit “a radio ad”, even though the agent has never invested a single dollar in radio advertising. Even though the data is not perfect, it is still of value for the agent to know where their marketing investment is having the most impact – although in this case, some mediums may never offer what is considered to be “perfect” data.

After marketing investments have been made and a client list begins to grow, what happens next? (Where do we go from here? — and– Is it strategic?)

In 2015 and beyond, brands of all sizes have nearly limitless opportunities to use a CRM and its associated data to grow their business. For luxury businesses in particular – specifically the travel and hospitality industry – one single, but potentially greatly impactful use – is in providing preference-based benefits to travelers that can increase not only consumer satisfaction, but average spend, as well. Take, for example, a luxury hotel and spa property. Having booked a repeat visit from a guest who has dined on-site in the past, what if the hotel had a record of the wine that guest ordered at a prior dinner that was exceptionally well-received? A data point on the guest’s account at time of booking could trigger the reservation-booking agent to offer to have a bottle of that same wine chilled to the correct temperature in the guest’s room upon arrival. A $300 reservation might have just become a $375 reservation with the addition of the wine purchase, whether or not the traveler even sets foot in the dining or spa facilities at the luxury hotel.

The technology to enable these types of suggestion-based selling opportunities already exists – the only hurdle to implementing and benefiting from them are the same as when CRM systems were introduced in the 20th century: management support and investment, as well as end-user buy-in. In many cases, the “end-user” buy-in might not be limited to the business employee participating in the transaction, but the consumer, as well. For privacy and convenience-minded customers, they may never take the extra effort to create a “registered user account” when shopping online or may not regularly book travel accommodations directly through a hotel reservation desk or website, so the real future for CRM systems lies in how well they can be implemented for consumer profiles with incomplete data points or histories, while still enable value-increasing experiences for business and consumer.

Additional value from CRM systems can be gleaned by provided analytic-based insights, rather than decision makers relying on “gut feelings”. Comparing RBC Bank’s example where the “Value Analyzer came online, the Bank found that profitability rankings changed by at least two deciles for 70% of customers” (“Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged)”, Narayanan) to an estate jewelry brokerage, the brokerage also has the opportunity to gain valuable customers and audience-based data to inform their business decisions like the bank did. Being able to see which customers generate the most value, the most frequently (thus, earning a position in the valuable “True Friends” segment of the matrix shared in “The Mismanagement of Customer Loyalty (Reinartz and Kumar)), would allow the business to invest more in improving the relationship with that customer and thanking them for their business (for example, with more valuable customer gifts). They also can have true insight into which products receive the most traction and insight on their website and how that translates into sales and inventory turnover with data driven by free or paid website and e-commerce analytics software.

By narrowing in on the best practices shared in “CRM Done Right” (from “Which results matter most” to “business needs taking precedence over technological capabilities” ), decision makers and their marketing and sales teams can see that while CRM technology continues to grow by leaps and bounds and become more affordable and accessible than ever, strategic decisions still must be made in advance about how to structure and implement a system for it to be most effective in generating results that everyone (business and consumer) can benefit from.