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Marketing To The Segment Of One

Jonathan Moran

Today’s consumers are more informed and empowered than ever, and businesses must meet their demands to stay competitive and relevant. Mass marketing is proving to be less effective since customers expect personalized, real-time communications from brands. Additionally, undifferentiated marketing simply does not work for brands’ diverse market segments. Businesses must employ individualized marketing efforts to remain connected. With the variety of channels consumers can use to communicate and interact with brands, marketers have access to a goldmine of consumer information.

However, gaining access to this information and using it effectively has proven to be difficult for marketers, especially without all of the right tools. So how do businesses achieve marketing to the segment of one and make the most out of consumer behavior? Let’s first discuss exactly why individualized marketing is imperative for businesses. Then we’ll dive into how to employ personalized marketing and the technologies that enable it.

Why market to the segment of one?

Traditional marketing channels typically include advertising through print publications, radio and TV, mail, and phone. Many of these high-cost channels have fallen prey to lower-cost digital channels as consumers stay connected around the clock. Consumers want brands to connect with them individually, without the feeling of being stalked or intruded on.

Individualized marketing produces dynamically personalized content and messages that consumers are more likely to act upon. Marketers have seen a myriad of benefits from individualized marketing. According to a recent survey by Everage and The Realtime Report, the main benefits of real-time marketing include:

  • Increased customer engagement (81%)
  • Improved customer experience (73%)
  • Increased conversion rates (59%)
  • Improved brand perception (52%)

The majority of marketers today are harnessing this power, with 76% of surveyed marketers saying they have implemented real-time marketing techniques.

The omnichannel customer experience

The path consumers take to communicating and purchasing from brands has become significantly more complex. Say Joe Consumer started a conversation with Retailer Z on his preferred social media application, continued through website browsing and a phone call, and then finally visited the retailer in person. Though Joe was able to talk to Retailer Z, he had to update each channel’s spokesperson with his question, making him frustrated and turning him away from the offer. To alleviate this, it would be best for the retailer to be aware that all these separate interactions came from Joe to produce the most effective interactions with him.

How to market to the segment of one

To market to the segment of one, brands must deliver the right offer over the right channel at the right time, all while personalizing the offer at the individual level and taking into account all available consumer information. So how exactly do marketers do this? Three main things must be put into place:

  1. Contextual data: By collecting and combining data from all channels, Retailer Z would have known Joe’s basic customer information, purchase history, as well as digital behaviors from when Joe browsed the website and clicked through product details. Collecting all of this data, normalizing it (removing noise and structuring it), and housing it in a centralized logical repository – though a daunting task – is necessary in order to market to consumers individually.
  1. Analytics: Analyzing consumer data would also enable Retailer Z to put Joe in a specific market segment – which would then allow for forecasting and future behavior prediction. With established analytics, marketers can hone in on the driving force behind all consumer interactions. This can be done through analytical techniques such as segmentation, forecasting, modeling, and optimization.
  2. Omnichannel capabilities: The ability to orchestrate and deliver marketing actions across all available channels is becoming more imperative as brands move towards “segment of one” marketing. If Retailer Z could link disparate channel actions back to a common customer profile, iterations of marketing programs could take place to enhance and include future actions. Having a real-time infrastructure in place that consists of a decision management architecture that is available in a “steady-state” (always on) is imperative as well. This infrastructure is critical in order to be able to reply with the next best offer or action in a timely, often sub-second, manner. Traditional transactional environments don’t allow for these quick, analytically-based decisions to be made across all channels today.

Consumers’ need for more personal relationships with brands has shifted marketers’ focus from traditional mass marketing to marketing to the segment of one. This requires the right technology and knowledge to seamlessly connect a consumer’s actions across all channels and points in time. Today, the most advanced marketing departments deliver these individualized experiences using contextual data, analytics, and omni-channel capabilities to achieve increased customer engagement and loyalty.

For an in-depth look at Big Data analytics and the omnichannel customer experience, download the SAP ebook Digital Disruption: How Digital Technology Is Transforming Our World.

To learn more about business innovation in the digital era, download the SAP eBook, The Digital Economy: Reinventing the Business World.

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Jonathan Moran

About Jonathan Moran

Jonathan Moran is responsible for global marketing activities for all SAS Customer Intelligence solutions. Mr. Moran joined SAS in March of 2008 bringing seven years of industry experience with him, having worked in Global Professional Services and Sales Support roles at the Teradata Corporation. Over the past 14 years, Mr. Moran has had the opportunity to not only architect, develop, demonstrate, and implement Customer Intelligence solutions, but he has also had the opportunity to work on-site with Fortune 500 customers helping them solve unique digital marketing challenges. Mr. Moran graduated from North Carolina State University with an undergraduate double major – Marketing and Spanish Languages and Literatures. Mr. Moran also holds a MBA from North Carolina State University with a concentration in Technology Commercialization.

Why $4.6 Trillion Was Left In Abandoned Online Shopping Carts In 2016

Aaron Solomon

Nearly 70% of online shopping carts are abandoned without the customer ever completing the purchase. According to Business Insider, that added up to over $4.6 trillion in the global economy in 2016. So, what can online retailers do to fix this problem? Keep reading to learn why cart abandonment is so prevalent, and the steps you can take to recapture potential sales in your business.

Top 3 (preventable) reasons for cart abandonment

Customers abandon online carts for a variety of reasons, ranging from issues with your online store to simply getting distracted and leaving their computer. Studies show three common, and often preventable, reasons customers do not complete the checkout process.

1. Shipping cost sticker shock

For a whopping 61% of U.S. shoppers, the number one reason they don’t complete the checkout process is unexpectedly high shipping costs. Customers may have found your product prices acceptable, but high shipping costs can change their view completely. Not every company can subsidize shipping, and even fewer can on all orders, but here are a few things you can do to try to reduce your customers’ shipping cost shock:

  • Price fairly: Review what you are charging your customers for shipping against what your actual costs are. It’s no sin to turn shipping into a revenue stream, but if these costs are excessive, it may be costing you more in sales than it’s worth.
  • Offer options: Depending on your carriers, consider offering customers slower, but more cost-effective options, such as UPS 3 Day Select instead of Next Day or Second Day Air.
  • In-store pickup: If you also have physical stores, consider offering in-store pickup as an option.

2. Lack of trust in your site

Whenever a first-time customer makes a purchase, they are demonstrating trust in your ability to fulfill their order, charge them accurately, and most importantly, protect their data. There are several website attributes that could cause customers to consider shopping elsewhere:

  • Site maintenance: If your site has blurry images or broken links, customers may doubt your ability to meet their needs.
  • Online security: Include a “Trusted Site” logo from your certificate authority on your site to tell customers that you have properly secured your site.
  • Return policy: Having a complete and accessible return policy on your online store can provide customers with the reassurance that if the product does not meet their expectations, there will be a way for them to address this issue.
  • Shipping clarity: A shipping information page provides customers information they will want to know before committing to a purchase, such as how long after an order is placed it will be shipped or what shipping carriers and delivery options are available.

3. Frustration during the checkout process

The main perk of online shopping is convenience. If your checkout process is slow or tedious, customers get frustrated quickly. Take the following three points into consideration to mitigate this concern:

  • Guest checkout: In 2016, 33% of U.S. shoppers abandoned their carts when forced to create an account. Having a customer create an account can be beneficial for your business, but, if customers are forced to create an account to make a purchase, is it worth it? Consider leaving the option for them to check out as a guest to simplify their shopping experience.
  • Coupon codes: If you offer promotions with coupon codes, make sure that all your marketing information has the correct coupon codes and expiration dates for these codes.
  • Make it easy for customers to reach you: As a best practice, online stores should always have a “Contact Us” page to allow customers to easily reach out. If customers are experiencing frustration, being able to reach you can be the deciding factor on whether they give up or not.

Successful online retailers manage these issues to ensure that when customers abandon carts, it is not due to failures of the business. Taking these steps can reduce the amount of lost revenue, as well as increase your business’ reputation with both current and prospective customers.

For more insight on selling through digital channels, see Primed: Prompting Customers to Buy.

This blog was originally posted on the SAP Anywhere Customer Success Portal, and has been reposted with permission.

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Aaron Solomon

About Aaron Solomon

Aaron Solomon is the head of Training and Content Development for SAP Anywhere. With a dedicated history in knowledge management and consulting, he is driven to provide quality information to customers and help them understand how best to grow their businesses. His areas of expertise include e-commerce management, data analysis, and leveraging technology to improve efficiency.

Using Philosophy To Find Happiness In A Hyperconnected World

Adam Winfield

Zen and the Art of Motorcycle Maintenance, published in 1974 by Robert M. Pirsig, has been called the biggest-selling and most widely read philosophy book ever. A fictionalized autobiography of a motorcycle road trip the author took with his son Chris across America, the book became influential thanks to its transcendent philosophical digressions. Despite the title, it’s not really about Zen Buddhism – or motorcycles – but living a good and meaningful life.

Pirsig, who died earlier this year, showed us “it might actually be possible to unify the cold, rational, numbingly systematized world of science and technology with the warm, intuitive realm of art and the spirit,” according to writer Tim Wilson, who interviewed him the year the book was released.

“If you run from technology, it will chase you,” Pirsig told Wilson, a caution that carries increased significance in a time when GPS tracks the location of our smartphones and high-bandwidth wireless Internet coverage smothers much of the populated land on Earth.

Pirsig’s point wasn’t that we should run from technology, or hate it. He called out the self-defeating hypocrisy of loathing and resisting technology but lapping up the standard of living it provides. Instead, technology should be considered part of nature, and part of humanity. “The Buddha, the Godhead, resides quite as comfortably in the circuits of a digital computer or the gears of a cycle transmission as he does at the top of a mountain or in the petals of a flower,” he wrote.

Zen and the Art of Motorcycle Maintenance, 2017 edition

Had Pirsig taken his road trip in 2017 he’d be faced with a very different world to the one of 1974, more than 25 years before the Internet went mainstream. Given his willingness to embrace technology, we can assume he’d have taken a 4G-enabled smartphone along for the ride. The technology – the satellites, the data, the sensors – wouldn’t be chasing him; it’d be right there in his pocket.

Unlike those who retreat into nature for “digital detoxes,” not realizing their addiction to technology rather than technology itself is the problem, Pirsig would have seen the beauty in a connected device that made his journey through the American wilderness more enjoyable, safer, and easier.

He’d have been with nature in all its glory, but also connected to the rest of humanity, dipping into the benefits that offers whenever he deemed it necessary or worthwhile. It’s unlikely he’d have felt the urge to check the latest gossip on Twitter or Facebook, but Google Maps, TripAdvisor, and Airbnb sure would have come in handy.

Those more suspicious of today’s hyperconnected technology might say this fails to consider the dark side of sharing your browsing habits, your whereabouts, and other aspects of your existence through your smartphone. To take advantage of the best your device can offer, you must in turn give up so much of your privacy to companies looking to make a buck off the data you’re generating.

Take location-based marketing, for example, which sends location-specific advertisements to consumer’s mobile devices. Sounds pesky and a little… dystopian, doesn’t it? It evokes the scene from the 2002 science fiction movie “Minority Report,” in which Tom Cruise’s character is hit with a personalized ad that tells him he could “use a Guinness right about now.” Pirsig would have felt location-based marketing’s full brunt as he made his way across 2017 America, seeking food, shelter, and supplies.

How would Pirsig have felt about location-based marketing?

Again, though, he likely would have taken a more pragmatic view than the dystopian Luddites. You cannot, surely, buy a 4G smartphone, blindly connect it to servers around the world, and then fly into a rage when you discover your data and location is being sold off to the highest bidder. Unless human microchip implants are written into law, we’ll always have the option to avoid that inevitability.

For those naturally more open to the idea of location-based marketing and the serendipitous moments of magic it can help create – as well as those who stand to profit from it – 2017 looks like being a good year for the technology.

Nearly a third of the world’s population will own a smartphone this year, according to Statista, and 80% of social media activity now happens on mobile devices. This gives companies a much fuller picture of what people are doing and where they’re doing it. People aren’t afraid to use their phones to buy things, either; global mobile e-commerce revenues are projected to reach $549 billion in 2017.

These trends are converging with breakthroughs in technology that are taking location-based marketing to new levels of complexity. Sensors enabling near-field communications (NFC) are not new, but they’re coming down in price. This technology was included in the last two generations of Samsung and Apple phones. Elsewhere, geo-fences use GPS, Wi-Fi, electromagnetic fields, or RFID technologies that capture data from consumers situated in specified areas – a concept Google and Apple are invested in.

Pokémon Go showed that people are ready for augmented reality; again “Minority Report”’s Guinness holograms offer us a vision of how that technology could translate into the world of advertising. And then there’s context, the plumbing of location-based marketing. Context, which feeds on Big Data, is only getting richer, giving brands a deeper understanding of where consumers are, where they’re headed, and what they might want to buy. Done well, all this technological advancement is undeniably useful for consumers too.

So, next time you get out on the open road looking for a clean break from your neurosis-inducing technology habits, consider taking your smartphone with you. It will almost certainly come in handy. As Pirsig might have said (albeit more eloquently), nature and technology are friends, not enemies. Embracing both, warts and all – and embracing them wisely – is the key to living a full and happy life.

For more insight on technology and the well-balanced life, see Give Me Technology, But Help Me Deal With It.

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Adam Winfield

About Adam Winfield

Adam Winfield writes about technology, how it's affecting industries, how it's affecting businesses, and how it's affecting people.

Running Future Cities on Blockchain

Dan Wellers , Raimund Gross and Ulrich Scholl

Building on the Blockchain Framework

Some experts say these seemingly far-future speculations about the possibilities of combining technologies using blockchain are actually both inevitable and imminent:


Democratizing design and manufacturing by enabling individuals and small businesses to buy, sell, share, and digitally remix products affordably while protecting intellectual property rights.
Decentralizing warehousing and logistics by combining autonomous vehicles, 3D printers, and smart contracts to optimize delivery of products and materials, and even to create them on site as needed.
Distributing commerce by mixing virtual reality, 3D scanning and printing, self-driving vehicles, and artificial intelligence into immersive, personalized, on-demand shopping experiences that still protect buyers’ personal and proprietary data.

The City of the Future

Imagine that every agency, building, office, residence, and piece of infrastructure has an entry on a blockchain used as a city’s digital ledger. This “digital twin” could transform the delivery of city services.

For example:

  • Property owners could easily monetize assets by renting rooms, selling solar power back to the grid, and more.
  • Utilities could use customer data and AIs to make energy-saving recommendations, and smart contracts to automatically adjust power usage for greater efficiency.
  • Embedded sensors could sense problems (like a water main break) and alert an AI to send a technician with the right parts, tools, and training.
  • Autonomous vehicles could route themselves to open parking spaces or charging stations, and pay for services safely and automatically.
  • Cities could improve traffic monitoring and routing, saving commuters’ time and fuel while increasing productivity.

Every interaction would be transparent and verifiable, providing more data to analyze for future improvements.


Welcome to the Next Industrial Revolution

When exponential technologies intersect and combine, transformation happens on a massive scale. It’s time to start thinking through outcomes in a disciplined, proactive way to prepare for a future we’re only just beginning to imagine.

Download the executive brief Running Future Cities on Blockchain.


Read the full article Pulling Cities Into The Future With Blockchain

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Dan Wellers

About Dan Wellers

Dan Wellers is founder and leader of Digital Futures at SAP, a strategic insights and thought leadership discipline that explores how digital technologies drive exponential change in business and society.

Raimund Gross

About Raimund Gross

Raimund Gross is a solution architect and futurist at SAP Innovation Center Network, where he evaluates emerging technologies and trends to address the challenges of businesses arising from digitization. He is currently evaluating the impact of blockchain for SAP and our enterprise customers.

Ulrich Scholl

About Ulrich Scholl

Ulrich Scholl is Vice President of Industry Cloud and Custom Development at SAP. In this role, Ulrich discovers and implements best practices to help further the understanding and adoption of the SAP portfolio of industry cloud innovations.

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4 Traits Set Digital Leaders Apart From 97% Of The Competition

Vivek Bapat

Like the classic parable of the blind man and the elephant, it seems everyone has a unique take on digital transformation. Some equate digital transformation with emerging technologies, placing their bets on as the Internet of Things, machine learning, and artificial intelligence. Others see it as a way to increase efficiencies and change business processes to accelerate product to market. Some others think of it is a means of strategic differentiation, innovating new business models for serving and engaging their customers. Despite the range of viewpoints, many businesses are still challenged with pragmatically evolving digital in ways that are meaningful, industry-disruptive, and market-leading.

According to a recent study of more than 3,000 senior executives across 17 countries and regions, only a paltry three percent of businesses worldwide have successfully completed enterprise-wide digital transformation initiatives, even though 84% of C-level executives ranks such efforts as “critically important” to the fundamental sustenance of their business.

The most comprehensive global study of its kind, the SAP Center for Business Insight report “SAP Digital Transformation Executive Study: 4 Ways Leaders Set Themselves Apart,” in collaboration with Oxford Economics, identified the challenges, opportunities, value, and key technologies driving digital transformation. The findings specifically analyzed the performance of “digital leaders” – those who are connecting people, things, and businesses more intelligently, more effectively, and creating punctuated change faster than their less advanced rivals.

After analyzing the data, it was eye-opening to see that only three percent of companies (top 100) are successfully realizing their full potential through digital transformation. However, even more remarkable was that these leaders have four fundamental traits in common, regardless of their region of operation, their size, their organizational structure, or their industry.

We distilled these traits in the hope that others in the early stages of transformation or that are still struggling to find their bearings can embrace these principles in order to succeed. Ultimately I see these leaders as true ambidextrous organizations, managing evolutionary and revolutionary change simultaneously, willing to embrace innovation – not just on the edges of their business, but firmly into their core.

Here are the four traits that set these leaders apart from the rest:

Trait #1: They see digital transformation as truly transformational

An overwhelming majority (96%) of digital leaders view digital transformation as a core business goal that requires a unified digital mindset across the entire enterprise. But instead of allowing individual functions to change at their own pace, digital leaders prefer to evolve the organization to help ensure the success of their digital strategies.

The study found that 56% of these businesses regularly shift their organizational structure, which includes processes, partners, suppliers, and customers, compared to 10% of remaining companies. Plus, 70% actively bring lines of business together through cross-functional processes and technologies.

By creating a firm foundation for transformation, digital leaders are further widening the gap between themselves and their less advanced competitors as they innovate business models that can mitigate emerging risks and seize new opportunities quickly.

Trait #2: They focus on transforming customer-facing functions first

Although most companies believe technology, the pace of change, and growing global competition are the key global trends that will affect everything for years to come, digital leaders are expanding their frame of mind to consider the influence of customer empowerment. Executives who build a momentum of breakthrough innovation and industry transformation are the ones that are moving beyond the high stakes of the market to the activation of complete, end-to-end customer experiences.

In fact, 92% of digital leaders have established sophisticated digital transformation strategies and processes to drive transformational change in customer satisfaction and engagement, compared to 22% of their less mature counterparts. As a result, 70% have realized significant or transformational value from these efforts.

Trait #3: They create a virtuous cycle of digital talent

There’s little doubt that the competition for qualified talent is fierce. But for nearly three-quarters of companies that demonstrate digital-transformation leadership, it is easier to attract and retain talent because they are five times more likely to leverage digitization to change their talent management efforts.

The impact of their efforts goes beyond empowering recruiters to identify best-fit candidates, highlight risk factors and hiring errors, and predict long-term talent needs. Nearly half (48%) of digital leaders understand that they must invest heavily in the development of digital skills and technology to drive revenue, retain productive employees, and create new roles to keep up with their digital maturity over the next two years, compared to 30% of all surveyed executives.

Trait #4: They invest in next-generation technology using a bimodal architecture

A couple years ago, Peter Sondergaard, senior vice president at Gartner and global head of research, observed that “CIOs can’t transform their old IT organization into a digital startup, but they can turn it into a bi-modal IT organization. Forty-five percent of CIOs state they currently have a fast mode of operation, and we predict that 75% of IT organizations will be bimodal in some way by 2017.”

Based on the results of the SAP Center for Business Insight study, Sondergaard’s prediction was spot on. As digital leaders dive into advanced technologies, 72% are using a digital twin of the conventional IT organization to operate efficiently without disruption while refining innovative scenarios to resolve business challenges and integrate them to stay ahead of the competition. Unfortunately, only 30% of less advanced businesses embrace this view.

Working within this bimodal architecture is emboldening digital leaders to take on incredibly progressive technology. For example, the study found that 50% of these firms are using artificial intelligence and machine learning, compared to seven percent of all respondents. They are also leading the adoption curve of Big Data solutions and analytics (94% vs. 60%) and the Internet of Things (76% vs. 52%).

Digital leadership is a practice of balance, not pure digitization

Most executives understand that digital transformation is a critical driver of revenue growth, profitability, and business expansion. However, as digital leaders are proving, digital strategies must deliver a balance of organizational flexibility, forward-looking technology adoption, and bold change. And clearly, this approach is paying dividends for them. They are growing market share, increasing customer satisfaction, improving employee engagement, and, perhaps more important, achieving more profitability than ever before.

For any company looking to catch up to digital leaders, the conversation around digital transformation needs to change immediately to combat three deadly sins: Stop investing in one-off, isolated projects hidden in a single organization. Stop viewing IT as an enabler instead of a strategic partner. Stop walling off the rest of the business from siloed digital successes.

As our study shows, companies that treat their digital transformation as an all-encompassing, all-sharing, and all-knowing business imperative will be the ones that disrupt the competitive landscape and stay ahead of a constantly evolving economy.

Follow me on twitter @vivek_bapat 

For more insight on digital leaders, check out the SAP Center for Business Insight report, conducted in collaboration with Oxford Economics,SAP Digital Transformation Executive Study: 4 Ways Leaders Set Themselves Apart.”

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Vivek Bapat

About Vivek Bapat

Vivek Bapat is the Senior Vice President, Global Head of Marketing Strategy and Thought Leadership, at SAP. He leads SAP's Global Marketing Strategy, Messaging, Positioning and related Thought Leadership initiatives.