Why I’d Rather Make Money Than Always be Right
Late Night with Larry: Volume 5
A lot of people would rather be right than make money.
For me, it's the other way around. Because if I'm always right, then I'm probably not taking enough risk. And risk is what it takes to grow a business and hit ambitious goals in the long run. From spending on new technology to making sizable investments on the best and brightest talent to implementing a bold ad campaign to acquiring another company, meaningful growth (and the ability to scale) requires it.
But the difference between success and failure hinges on whether or not the risk is calculated with the right inputs. The best leaders do their homework so that they’re making informed decisions. This is true at any time, but 2020 -- with all of its uncertainty -- reinforced just how important it is to take the appropriate amount of risk in order to survive and thrive.
As we look to 2021, I am sharing the four most important lessons I’ve learned about smart risk taking. These are the things marketing leaders need to know -- and subscribe to -- in order to take risks, especially ones that could have major implications on your organization’s financial wellbeing.
1. Be OK with losing in the short-term.
Sometimes, the results of a risk take time to materialize. The best marketers practice patience, giving their ideas and actions time to breathe -- and become profitable. Leaders must recognize that trial and error is an important part of the process.
At Rise, it’s our job to help brands understand that marketing tactics must be tested so you can learn what is resonating with your audience and what isn’t. Having a strong level of conviction and comfort in knowing that not all bets will pan out applies to risk taking more broadly. Contrary to popular belief, you should constantly be experimenting with new and different platforms. Only then can you identify the next area of opportunity. If you panic because you’re not seeing early returns and pull the plug before the results of your new strategy can become statistically significant, then you may lose out on something that can have real impact.
I coach my team to define milestones or checkpoints when they will evaluate success prior to testing a new idea. These milestones may be based on a length of time, an amount of spend, or a volume of results captured.
2. Back your decisions by math.
In order to assess if a marketing risk is worth taking, CMOs and other decision-makers can and should crunch the numbers to estimate the probability of success and the potential impact of testing new ideas. CMOs have access to more measurable data points than ever before and have the capacity to make decisions based on actual performance metrics rather than instincts or impulses. Digital marketing, of course, is a large contributor to the variety and depth of available data. Having this information at your fingertips means marketers can be smarter about predicting the impact of a successful risk and the trade-offs for ideas that may not work.
What’s more, when you’ve implemented a tactic that is experiencing high levels of engagement and ROI, you can cite this data to make a strong case for scaling up -- and investing more money in something that yields real results. It is also important to remember that risk taking and testing should be a dedicated portion of your ongoing budget, and trying new ideas should complement -- rather than replace -- your proven core strategy. In reality, not all test investments will generate a return. The math still works because over time the upside you will see from your handful of winners will outweigh the cost of the losers.
3. Be savvy with how you get buy-in from stakeholders.
Your marketing program is only as strong as the people behind it. It’s critical to have conversations with your Board or C-suite upfront to ensure they are on board and in support of your planned course of action. Approach the conversation with powerful data, as mentioned above, that defends your position and compels people to listen. It is important to articulate the risk-to-return ratio to prove that the risk is worth taking. This may sound obvious, but I have seen smart marketers overlook this step. Investing $100 in a new idea that is projected to make $101 is very different than risking $100 to make $1,000. If leadership isn’t comfortable with the risk -- or, even worse, doesn’t agree with it -- they’re more likely to 1) pressure you to perform faster and 2) abandon the risk prematurely, before it has the chance to pay off. Conversely, by earning trust and having the tough conversations early on, you’ll empower yourself to deliver on your promise.
4. Become an early mover.
Believe it or not, many years ago at Rise we had a conversation about whether or not we should form a social media practice. At that time, the monetization roadmap of social platforms was less clear. We invested in building a team anyway. The rest, as they say, is history. The point is: There’s an advantage for those who recognize market trends and make a bold move before others. With the right bets, that early move can be the difference between hockey stick organizational growth and stagnation.
More recently, we saw this opportunity when Amazon was in the very early stages of building an advertising capability. We had a strong sense based on consumer behavior trends that Amazon Advertising had the potential to be huge. We took a bet to launch a pilot program and ran campaigns for our first clients at steep discounts to prove out the channel. The impact of that risk on our organization’s growth has been enormous.
As I’ve said, not every early move you make will have a financial windfall. Listen to the market and keep a pulse on trends. Shifts in consumer behavior are some of the best harbingers of what’s to come for marketers. 2020 has made that abundantly clear. At Rise, there are a lot of nascent platforms and tech that have us excited: programmatic Out-of-Home ads, stories and full-screen video on almost all social channels, Twitter’s release of Fleets, and the growth of video-making social app Triller -- just to name a few.
While some may consider risk-taking to be irresponsible -- or in my experience, lack the stomach for it -- in reality it is a necessary component of innovation and upward mobility. Without it, businesses would never evolve; they would continue to accept the status quo and stay stagnant. Recognizing that risk is healthy and that being wrong sometimes is okay, marketers should continue to push the envelope -- and make calculated moves in order to stand out in a digital marketplace that’s becoming more and more crowded.
Let’s keep talking. I’d like to hear about your digital marketing efforts: What are you trying, and how is it panning out? How do you decide what to move forward with -- and what to put on the back burner? Message me so we can keep the conversation going.
3 unique advantages of digital marketing for B2B organizations
Late Night with Larry: Volume 4
“Does digital marketing really work for business-to-business organizations?”
This is a question I’ve been asked many times by business leaders and decision-makers who aren’t convinced that digital marketing investments can move the needle for their organizations. Sometimes this uncertainty stems from unsuccessful past attempts to reach their target customers digitally, and other times it’s based more on feeling than fact.
Regardless of the reason, my answer is always the same: When it comes to B2B marketing, every company -- no matter its industry, size, goals, or budget -- needs to establish a digital presence immediately and prioritize its digital marketing strategy and capabilities going forward. The organizations that hesitate to embrace the digital marketing movement, as well as the slow adopters, will eventually get left behind.
The data backs this up. Gartner research found that when B2B buyers are considering a purchase, they spend the bulk of that time researching independently online. The amount of time spent with any one sales rep may be only 5% or 6%. Having quality information readily available via digital channels is critical if sellers want to influence customer decisions.
B2B companies that want to fuel organic growth and out-perform the competition need to get serious about digital marketing. But, like any investment, having the right strategy is critical to realizing a return on your efforts. Here are three unique advantages of digital advertising that B2B marketers should consider for a flourishing digital marketing program in 2021 and beyond.
1. Develop a hyper-focused audience strategy
A unique benefit of digital marketing is the ability for B2B marketers to talk directly to a specific target audience at scale and be strategic about how and when you reach them. Businesses have many opportunities to create meaningful and authentic connections by pairing sophisticated targeting with audience-specific content. For upselling existing customers, your CRM database can fuel segmented messaging using search and display advertising to show specific customer groups the benefits of services they aren’t currently leveraging. LinkedIn is a powerful resource for serving ads based on a specific account list or industry verticals. You can show ads or sponsor content in publications that influence your customers. The use cases are endless.
By segmenting your audiences and creating a messaging strategy for each one, your company can tailor content so it resonates with each respective group -- and be intentional about the timing and frequency of messages. This granularity is the future of digital marketing. And, for brands that invest the time to create granular strategies that address the specific pain points of different audiences, there is a real opportunity to differentiate from the competition. (For more on how we’re helping clients do this, check out my recent article here.)
2. Track performance and prove ROI
With the robust measurement capabilities available through digital advertising, marketers can test the efficacy of every tactic and continually improve. This is hugely beneficial for B2B CMOs and marketing leaders needing to justify a strategy or make the case for a larger budget to, for example, try a new approach or spend on better technology. The digital landscape affords B2B marketers the opportunity to learn quickly and fail fast. If you see high levels of engagement with one campaign or certain tactics performing better than others, you can shift your focus (and dollars) to drive those efforts and pull back from others. For example, you can measure how messaging across different business lines resonates with customers by looking at ad engagement, website usage, and lead generation; you can then use these insights to inform other marketing efforts.
At Rise, we’ve learned that to truly leverage analytics and use them to their fullest potential, companies have to take it one step further and do the math. In addition to looking at new leads, opportunities, and conversions, the ultimate goal should be calculating customer lifetime value, so that you’re able to predict the net profit attributed to the entire relationship with a customer. If you know the cost of acquiring a new lead and connect it to CRM data and subsequent marketing efforts, your business can use more sophisticated goals based on the expected lifetime value of each lead or opportunity. This level of analysis also informs what types of customers you should be targeting with your marketing.
3. Scale quickly and easily in a virtual world
COVID-19 has certainly changed our normal way of doing things. Face-to-face interactions and in-person events are few and far between -- and likely won’t resume for some time. Until a vaccine becomes widely available, we’ll need to continue finding creative ways to maintain socially-distanced relationships with current customers and attain new ones.
With digital marketing, B2B organizations can reach specific audiences with highly relevant messaging at scale. This blend of reach and relevance is very difficult to replicate with traditional marketing channels. This scale allows you to be where your customers are at a frequency and cadence that keeps you top of mind. Each digital channel has a different responsibility within the buying funnel, so businesses have the ability to pick and choose which tactics and assets to use based on what you’re trying to accomplish at each level. In other words, by taking an omni-channel approach to digital marketing, your company can use multiple tactics and multiple channels to reach multiple personas at the same time.
Historically, B2B marketing has taken a back seat to its B2C counterpart, with smaller media budgets and less attention paid to strategic planning. But, as the digital marketplace expands, we’re seeing a dramatic spike in the number of companies prioritizing their efforts to reach and start conversations with business customers just as they would a consumer. For the first time, as companies are realizing the benefits of investing in dynamic and full-throttle marketing to reach business prospects, B2B marketing has a seat at the table. No longer throwing darts to see what sticks, digital marketing has ushered in a new era where organizations of all types can take a directed approach and generate real returns. It’s money well spent.
I’d love to hear from you -- tell me what you’re doing in the B2B marketing space. Send me a message so we can continue the discussion.
3 new ways to think about how to spend your digital marketing budget today
Late Night With Larry: Volume 3
At Rise, we live by a philosophy that’s grounded in math.
The gist of it is this: We spend the most money on the best-performing tactic or strategy -- whether it’s a keyword or an audience segment -- until we squeeze every ounce of performance out of it. Only then do we move on to the next thing.
For companies to do this effectively, you need a solid grasp on how your media investments tie to your business goals. This isn’t an easy task in today’s digital landscape where countless channels and siloed data abound. But it is a big opportunity -- one that Rise seized on over a decade ago.
In fact, it’s what fueled the launch of Connex, Rise’s cross-channel media optimization platform. Put simply, it’s the tech that allows us to aggregate all of this siloed data, identify what is (or isn’t) performing and take action.
Today, Connex continues to lead the industry in enabling granular performance management at scale. And in 2020, a year of nonstop curveballs, it’s helping us successfully solve the many new challenges our clients now face -- from rapidly changing customer needs and behaviors to unpredictable inventory levels.
Amidst all of this, three key learnings stand out. I’m sharing them here because it’s likely these ideas could prove helpful as you think about how to improve performance and best allocate your digital marketing budgets.
1. Focus on incrementality. There are a number of major industry shifts happening right now that can’t be ignored. Web browsers are phasing out the usage of third-party cookies, Apple is rolling out new measures to protect user privacy, and platform walled gardens are growing taller. All of these changes are adding to the murkiness of attribution, which has always been an imprecise science. Rather than trying to retrofit attribution rules in this ever-changing environment, we believe that focusing on incrementality is a more actionable way to look at media performance.
Incrementality is about finding similar ways to compare variables -- like channels, geographies or audiences -- so we can identify what combination of efforts delivers on a desired business objective. This approach gives you confidence that you’re allocating budgets in the most effective way possible -- e.g., doing these three things drives more sales than these three things. To activate an incrementality strategy, you need analytical minds to design the right tests, and you also need a way to evaluate performance variables apples-to-apples, which gets back to why we built Connex.
For example, if you want to maximize top-of-funnel strategies across search, programmatic, and social, you can run different awareness campaigns across channels and track the performance of these tactics side-by-side. Then, you can look at the lift of a certain performance metric compared to the baseline to answer questions like: Which combination of campaigns led to the greatest increase in brand recall?
At Rise, we use Connex to collect and normalize campaign data, making it easy to see how various tactics perform. But however you execute incrementality testing, the benefits are similar: You can quickly identify the affected variable, assess its impact and make decisions.
2. Get granular with your audience strategy. A lot of companies claim they have unique or proprietary audience data. Sure, you can buy all this data, but you won’t be any smarter for it without a strategy around how to use it. Today, that strategy should focus on granularity, which means setting up an account to provide very specific insights from the get go in order to solve different challenges or needs, such as cannibalization, out of stock inventory or audience overlap.
Cosmetics brand (and client) ColourPop put this into practice, using an advanced audience strategy that increased revenue by 124 percent. When determining the targeting for a social campaign, understanding who to exclude is just as important as knowing who to include at various stages of the purchase funnel. We helped ColourPop identify and isolate specific audiences that were very close to purchasing and exclusively showed these individuals bottom-of-funnel creative designed to drive conversions. To do this, we excluded this highly valuable audience segment from any other campaigns that did not feature a strong call to purchase. (You can read more about the campaign here.)
When you start to put these granular strategies in place at scale, you need a strong foundation in data and technology to be successful.
3. Rethink how you retarget. Just about every brand does retargeting. (Also called remarketing, it allows you to serve ads only to people who have already interacted with your brand online.) But similar to the example above, doing this successfully starts with setting up the account to solve for a very specific need. Let’s take e-commerce businesses as an example: Online shopping has grown by more than 30 percent in 2020, leaving many online retailers managing frequent in-stock and out-of-stock changes.
Rather than lose a sale due to an out-of-stock product, you can retarget these shoppers with other similar products. This requires a sophisticated social tagging strategy, including tagging pages that feature products that are often out of stock and identifying appropriate alternate products. In addition to driving revenue, this strategy delivers a positive customer experience.
For me, each of these examples serves as an important reminder: Behind many of the challenges marketers face today lie even greater opportunities to increase revenue and customer loyalty. Uncovering these requires creativity and a data-driven mindset (qualities I’m proud to say every Riser possesses), along with a high degree of granularity.
Granularity, however, is difficult to implement and requires an enormous amount of time. All too often I see brands reach a certain level of sophistication with their campaign structure and then stop. But stopping means missing an opportunity to gain a competitive edge. If you’re ready to keep going and seize these opportunities we’re happy to help. Message me and let’s talk.
3 things you need to turn data into a powerful decision-making engine
Late Night with Larry: Volume 2
I’ve always been drawn to data.
Growing up, my friends and I played sports video games. At the time, game systems weren’t collecting player stats -- like the yardage of our running backs -- so we’d eagerly track this information on a piece of paper and compete with each other. It was a similar story with the stock market simulation computer game Millionaire. We obsessed over it.
This competitive spirit and drive for success has followed me throughout life. And I’ve found that having data at my fingertips to inform decisions has proven to be a huge advantage in both personal and professional settings.
But data on its own can only do so much. To turn data into a powerful decision-making engine in the workplace, you need to bring together three critical pieces: smart, analytical people + the right data + a proven framework.
And when you pair smart talent with extraordinary data and systems that others don’t have, and empower your team to be creative, they will do things that blow your mind. And your business will evolve with the market. Let’s take a look at how we bring this together at Rise.
1. Smart, analytical people. At Rise, our business runs on the ability to make smart, data-driven marketing decisions that produce results for our clients -- it’s a fundamental piece of the service we provide. So it should come as no surprise that analytical skills and enthusiasm for data are a major part of Rise’s culture. Even our snack assortment is determined by how quickly our inventory of different items gets depleted.
That said, the role of data varies by organization, and not all companies require the Rise level of data obsession to succeed. It’s important to understand the specific applications that will provide the greatest value for your particular company, client or brand. One truth remains constant: You cannot unlock the power of your data unless you have the right analytical people to make sense of it.
You also need an effective way to assess if a candidate possesses these skills. We learned early on that simply asking candidates to describe their analytical experience was not a strong indicator of how well they performed in roles built around data. So we created our math test, a 30-question, timed exercise that simulates real-life client campaigns with questions that our team asks, evaluates and answers everyday. All Risers who work on our client delivery teams must meet our challenging pass rate criteria to get a job at Rise. This is one of the tools we use to find the best talent for our clients, and it has had a substantial impact on creating and maintaining a data-driven culture.
2. The right data. There’s no shortage of data available today. (In fact, 90 percent of the world’s data was created in the last two years alone.) The key is knowing what data matters to your business and how to gather and analyze it. Which leads me to the next part of the equation: Getting your hands on the right data.
In digital marketing, the “right” data north star is an understanding of how every ad dollar is performing across all channels so we can make better decisions about where to invest next. Harnessing this kind of meaningful data is virtually impossible without the help of technology. At Rise, this tech takes the form of Connex, our media optimization platform that brings the right data together across all digital marketing channels so that our analytical marketers can spend our clients’ budgets in smarter ways.
This is what works for us, but the takeaway for any organization is this: Figure out how to use data in a new way that creates a competitive advantage. Rise is breaking down the walled gardens of Facebook, Google and others to bring data together in a way no one else can right now. How many brands have all of their digital media data at their fingertips in real time, with the ability to make decisions at a meaningful level of granularity? What does this look like for your business?
3. A proven framework. The people and the data are critical. But just as important is having a framework that teaches people how to think about the data. At Rise, this is known as the Rise Five. Five questions that Risers must be able to answer about a client account. They include:
- What are the client’s goals?
- What is the client’s budget?
- How are we tracking against these goals and budget?
- What are we going to do about it?
These may seem like simple questions, but all too often in marketing the “why” and “what’s next” aren’t answered. Knowing this, the first step in building Connex was to organize data in a format that allows us to quickly answer the first three questions, freeing up our time to focus on the “why” and “what’s next.”
Keep in mind a framework on its own won’t get the job done. It needs the right culture to be successful. A workplace that nurtures creativity and rewards challenging the status quo will naturally empower people to really test and explore these big questions.
Every business will find its own equation for harnessing the power of data and human capital. But in my experience, the inputs will be similar, which makes sense. Because like I said earlier, when you pair really smart, data-driven people who want to work hard with extraordinary data and systems that others don’t have, and empower them to be creative, they will do things that blow your mind.
Is your organization pairing talent and tech in a unique way? I’d like to hear about it. Feel free to connect or message me.
3 things 2020 has taught me about employee engagement
Late Night with Larry: Volume 1
On March 13, as the Rise team in Chicago settled into a mandatory work-from-home order, I sent an early-morning email to all employees. My message was simple: These are challenging times, but we’ll get through them together and be better for it. I’m here and my (virtual) door is open to you. And most importantly, thank you. Rise is its people, and I was -- and continue to be -- grateful for the professionalism and support we all have shown to one another and our clients.
In the weeks and months that followed, I made it my mission to show employees that I meant what I wrote. The agency would cut expenses, not staff. We would continue to invest in talent and recruitment and make progress on diversity, an initiative I care deeply about. And there would be ongoing, open communication. I’m proud to report that since becoming CEO in March, Rise has hired over 60 people. Nearly three quarters of these new hires are women, three of whom are in leadership roles. And we’ve had zero layoffs due to Covid-19.
Amidst all of this, I closely followed the agency’s weekly employee engagement survey results. Early on in the pandemic, our eSAT score rose to a company all-time high and was up significantly from the year prior. (eSAT is a satisfaction score from the employee engagement software the agency uses, Glint.)
As the months went on, the scores have ebbed and flowed, but the trend continues to be positive. Some dips are to be expected as our workplace -- and the world -- grapples with a global health crisis and its impact on both our personal and professional lives.
In talking with employees and digging into the weekly survey data, I’ve found there are new and different factors moving the needle on employee engagement right now. Here are three things I’ve learned about employee engagement this year.
Listen first. Then over-communicate. When I transitioned to the CEO role in March, I began a listening tour. I had been with Rise for 10 years, most recently as President, but I wanted to attack this role like it was my first day at the agency. I’m analytical and data-driven, so I organized these conversations in a report and identified themes. As the pandemic has continued, so has my listening tour. Now I revisit these themes to understand what’s still relevant and what’s new. This helps me plan for our monthly virtual town hall meetings, during which all employees hear the latest agency, client and industry news.
Overall, employee feedback has been tremendously positive. The need to feel seen and heard, especially during challenging times is so human. As leaders, it’s our job to drive these conversations and respond in a meaningful way.
Numbers always tell a story. Dig until you know what it is. I mentioned our eSAT score earlier. While a helpful gauge, an overall number doesn’t always tell the full story of what’s really going on. That’s why analysis is critical.
For example, there was a period where we noticed a dip in scores related to work-life balance. Because we had a weekly pulse on employee engagement data, we were able to act on this information quickly. We asked our leaders to increase the frequency of conversations with their teams about managing workload. In listening to feedback from our employees, we learned that in addition to finding balance, there was an opportunity to improve delegation of work to team members. To empower our managers and directors to confidently delegate work, we’re providing management training and hiring a dedicated team to focus resource management so managers and directors have the time they need to effectively coach their teams. We continue to check in with employees and monitor engagement scores to assess effectiveness.
Rise is one of the most data-driven agencies in the world, so gathering and utilizing employee engagement data to make smarter decisions is core to who we are. But all organizations can benefit from this approach. The key is to not take data at face value. There’s always a bigger story to uncover. It’s our job to figure it out and take appropriate action.
Benefits matter. Know which ones your employees need now. Compensation and benefits will always be key factors in employee engagement. But today, some work perks like subsidized gym memberships and beer Fridays are no longer at the top of the list. At Rise, we’re constantly assessing what benefits employees need to feel productive and supported, and identifying how we can make these work within our budget.
This begins with listening. I’ve heard from many employees who struggle to take breaks or “turn off” work at the end of the day. This isn’t limited to Rise -- new research reveals the struggle is real, which is why it’s critical that we have this personal time. So, we’re finding creative ways to make sure employees take time off. This summer, we closed the agency two additional days and converted our annual employee appreciation day, Rise Day, into a day off. We communicate with clients about these closures in advance to ensure employees can truly take the time for themselves.
We also know Risers are actively involved in their communities and the social issues at stake and we want to support that. We decided that all employees can take a half-day off to vote, as well as a full day off to volunteer at the polls.
And we have programs in place to support working from home. Before the pandemic, Rise offered a generous number of WFH days. When it became clear that the uncertainty of the pandemic was causing extra strain on our employees, we moved to unlimited WFH days for the foreseeable future. We know that this flexibility is especially critical for parents who are managing e-learning. In addition, we also provide employees with a monthly stipend to offset the cost of home internet service.
This is just a handful of learnings. The takeaway here is that to effectively lead through a crisis, executives must understand there are new and different elements impacting employee engagement.
So why am I sharing all of this now?
Seven months into the pandemic, with many late-night emails to Risers sent, it feels like the right time to turn my attention outward, too. Risers will continue to hear from me as we tackle what’s ahead. And I will continue to listen. It’s how we all will continue to grow together. But I also hope those outside of the Rise community will join in the conversation. There’s much we can share and learn from one another, especially during this unprecedented time. Subscribe to the Rise blog to follow along, offer your comments, and reach out with thoughts. I look forward to it.
One final thought. I wrote that first email to Risers following a morning walk with our family dog, Miley. As she and I walked up the driveway, the rising sun cast a warm, comforting glow on us. I snapped a picture of it and shared it in my email. I believed then as I do now: We too will rise from this. And we will shine.