Dallas McLaughlin is director of interactive marketing for The James Agency, an Entrepreneurs' Organization (EO) member-owned company, and an EO Key Executive Program participant. We asked Dallas how the onset of digital marketing has changed the buyer's journey and what steps companies can take to address the changes. Here's what he had to say.
The Traditional Advertising Model
Businesses have been advertising for hundreds of years and, until very recently, the process has remained largely unchanged. Using the traditional, pre-digital technology model, the first touchpoint a brand had with consumers was out-of-home or direct marketing. The goal of this so-called stimulus phase was to broadcast the brand message to as many people as possible through mass media communication including newspapers, magazines, billboards, radio and television.
After brands issued their stimulus, there was little to be done other than wait for the result. The next step occurred during the consumer's retail experience in-store, on the shelf or at point-of-sale. This moment, coined the "First Moment of Truth" (FMOT), marked when the consumer was first confronted with the product in real life and had to decide which brand to purchase. If executed correctly, the stimulus played the role of building brand recall and trust with consumers, resulting in more purchases of their particular brand. For example, one classic stimulus you might remember is when Tony the Tiger takes a bite of Frosted Flakes and instantly erupts into an enthusiastic, "They're Grrrrreat!"
The final phase of the traditional advertising cycle, the "Second Moment of Truth" (SMOT) occurred when the consumer personally experienced the quality of the product, reinforcing―or debunking―the brand's message and influencing their decision to buy again. If your spoonful of cereal isn't as tasty as Tony the Tiger's was, you might choose a different brand on your next grocery run. In the heyday of traditional advertising, there was little opportunity for consumer feedback outside of snail-mailed letters to the manufacturer or word-of-mouth comments to friends and neighbors.
While the traditional model stood unchanged for close to 300 years, with the onset of digital technology, a new marketing moment has emerged. With 88% of U.S. consumers conducting product research online before purchase, the internet has changed the way consumers interact with brands, products and services. Most consumers solidify purchasing decisions well before actually entering a store or adding a product to their online shopping cart.
The Zero Moment of Truth (ZMOT)
The "Zero Moment of Truth," a term coined by Google in 2011, fully emerged in the mid-2000s when mobile device adoption rates skyrocketed, social media networks took off and unbiased third-party review sites took center stage.
With the ZMOT falling directly between the initial stimulus and the FMOT (the purchase), interested consumers now have unlimited resources at their fingertips for research, fact-checks, price comparisons and testimonials. The majority of resources consumers tap to inform purchase decisions fall outside the direct control of the businesses that would traditionally conduct advertising campaigns for the product in question. The ZMOT represents the first time in the formerly business-driven advertising machine that consumers have owned a piece of the purchase path. And make no mistake, consumers revel in their new role.
Google's initial research showed the average consumer utilizing 10.4 sources of information between seeing an ad and purchasing a product. By 2015, this number had climbed to an average of 22 sources, with up to 40+ sources reported in industries such as travel and hospitality.
Winning the ZMOT
With consumers referencing 20+ pieces of content before ever entering a store or purchasing a product, brands must proactively participate in every step of the online research process. But how can they realistically achieve this? Here are five strategies we recommend to our clients.
- Solicit genuine product reviews from current customers, distributed among various third-party review sites.
- Develop a consistent, organic social media strategy to ensure that your brand appears active, responsive and educated about the industry you operate within.
- Implement a strong blogging strategy, which can be used to develop content that addresses customer concerns, entertains communities, and provides endless ideas for social media posts and email marketing newsletters.
- Consider that for every US$1 invested in growing an email list, US$38 is returned. Even better, the email channel can be fully automated through drip and trigger campaigns to ensure that a brand consistently appears at the top of each customer's inbox.
- Change it up: When organic efforts reach a plateau, paid social media and paid search ads are an effective tool to target high-intent users with keyword phrases to maximize reach and return on investment.
The Purchase Journey Has Permanently Changed
Recognizing and accepting that the purchase journey has permanently changed is a business' first step toward drawing a new map for future marketing efforts.
The very thing that many businesses and marketers fear most―starting from scratch to develop a digital-first marketing initiative―is the very thing that must be done to keep any brand or business competitive in 2017 and beyond.
Digital marketing, or more specifically, content marketing, is how businesses build communities, develop brand advocates, lower acquisition costs, increase conversion rates and increase customer lifetime value―all of which signal a healthy, sustainable business built to thrive in our digital-first world.