A sneak peak at the Philips ‘Real Time Marketing Center’
Technology company Philips faces the same challenge as many other organisations with a relatively traditional media approach. That is, losing people along the sales funnel, somewhere between the ‘awareness’ and ‘conversion’ phases. The question remains as to how exactly big brand campaigns are delivering.
Lenze Boonstra, marketing director for the Philips Personal Care division, wants to introduce a new starting point when it comes to marketing within the organisation. Changing the funnel, rather than first raising awareness through TV campaigns and leading prospects all the way through to purchase, Boonstra sees immediate conversion almost as a first step. Which is why, early last year, he set up a ‘Real Time Marketing Center’ dedicated to social media engagement. Boonstra spoke about the Center at Adobe Symposium in Amsterdam November last year.
“It’s pointless winning people over with big marketing campaigns and pulling them through the sales funnel if it doesn’t result in conversion at the other end. This is why everything we do at the Center is conversion-driven. With the principle of social engagement, you’re meeting people half way through the funnel, where there’s real intent. That way, right from the start, you’re working far more directly towards conversion”, says Boonstra.
With a view to significantly reducing the time to market, the focus is on real-time optimisation of advertising campaigns. Boonstra continues: “It all starts with reach. And working with Facebook helps us increase our reach. In effect, Facebook represents the world’s largest database, allowing us to target very specific audiences at a fraction of the usual cost. Location, behaviour and connections offer enormous possibilities. Internally, a dedicated team is constantly optimising the posts.”
An example. To promote sales of the American Philips hair care brand, Norelco, Boonstra and his team decided to use video advertising. The video follows New York barber, Mark Bustos as he gives away free hair cuts to the homeless (see link below.) To stand out among the mass of Facebook posts, the renowned Bustos was chosen to execute the stunt, which touched on an emotive theme. The fact that Bustos was using a Philips shaver was never made explicit in the storyline.
“Stage two in this approach is establishing your target audience. We identified fifteen target groups based on a number of criteria. As conversion remained the main premise, we focused on cities where our Amazon sales were already high. We know there is existing interest in those areas, making them most likely to produce new conversions, quickly. We also know that most conversion happens on Mondays and Tuesdays. So if you want to lead people down the funnel, your first contact point would be some engaging content on Wednesday, followed-up with some product-related videos, and finally, on Monday, you offer a commercially appealing deal.”
“That’s when the real optimisation starts — the heart of real-time marketing”, says Boonstra. It transpired that certain sub-groups — whisky drinkers, and those living in Portland — did not respond well to the campaign, while others — older age groups — responded better than expected. “We also learned that conversion took place primarily on desktops, meaning that subsequent re-targeting should be tailored accordingly.”
Facebook offers a useful tool in allowing you to reach not only those you are already targeting, but also their lookalikes; this enabled Boonstra’s team to reach over five million more men on top of the initial 12 million targeted. Eleven million of these 17 million users viewed the video, with a surprising 70% of traffic being organic. The cost per view to the company equated to just 1.5 Euro cents.
Timing in Real Time Marketing
Two weeks before Father’s day, the team picked up on a shortage of traffic and decided to launch a banner campaign. What stood out, was that no less than 90% of conversions around this date were generated by men, and not — as per the predictions — by women. It became clear that focusing on people who were already familiar with the brand and the product was more lucrative when it came to conversion. Research revealed that review stars in a sponsored message added to the timeline resulted in further optimisation. Boonstra emphasises the importance of timing and a multi-disciplinary team for success. You need people who know the ins and outs of analytics, social, content and media buying like the back of their hand.
Boonstra continues: “The greatest challenge with this shift in thinking is without doubt finalising the business case. Since January, we’ve reduced our costs per lead by 50%. We’re now operating at 50% more efficiency thanks to constant optimisation. Now we need to look into systematically up-scaling this form of real time marketing for countries like India and Japan. How exactly this will be achieved is yet to be determined and something we’ll be focusing on over the coming months”, says Boonstra.
The ultimate goal? Peaking with real-time marketing instead of traditional media buying.
Boonstra adds: “I want an end to unwieldy 360 degree campaigns. If we can demonstrate exactly what an investment delivers, then we can peak exactly at the right time, at the point where you’re leading people through the sales funnel — in the run-up to Father’s day or Christmas, for example. Especially for younger target groups, as an organisation you need to be able to think from a digital marketing and conversion perspective. If you have other resources, you can cross over into other media. We really should be doing things the other way around.”