Data Science

“Our ability to do great things with data will make a real difference in every aspect of our lives.” – Jennifer Pahlka 

Traditionally, advertising and marketing were based on the hope of a random chance. You’d see an ad at just the right time before you were going to buy or, as you walk down an aisle in a store, you’d see a display that would catch your attention. Brands were built through the strategy of frequency and reach. With enough positive impressions, a brand could create an idea in your mind, and, if done correctly, it would tap into the zeitgeist and become part of the culture. This has been the dominant advertising paradigm for the last 50 years. 

With the advent of TV and radio, advertisers were in the position to deliver their messaging at scale. For the first time ever, there was the possibility to overcome randomness with enough advertising and money. In 2014, global advertising spend exceeded $575 Billion and is growing at a healthy 8% per year. In the US for example, advertisers spend $565 dollars per person, per year on paid media. 
Unfortunately, most business models expand to a point of absurdity and then collapse. I’m not saying that the ad business is going to collapse… at least not yet, but we’ve reached a point where the number of touchpoints, channels, and outlets has become too expensive to dominate. The result is a chaotic mess of ads seeking to capture your attention. The model of frequency and reach is now reserved for only the wealthiest of brands. 
This is where disruption begins. Because the expense is too high, innovation is required to achieve similar outcomes. Tahzoo is a byproduct of this next wave of disruption. We are helping our clients transition into a new way of doing business. I talk and write often about personalized and relevant content – well, this is a way for marketers to break through the clutter and engage audiences. A new paradigm for the 21st Century that ironically has its roots in a more traditional business model of knowing your customers and building personal relationships. No longer do they have to deliver a one size fits all, lowest-common-denominator message to the broadest audience. They can now begin to transform the digital customer experience into something personal and relevant. 

Seeing this change in the marketplace is what compelled me to start Tahzoo. I was excited because I could see the change coming and I knew if we built a company with the right expertise, we’d be relied on by our clients to help them change. This is really what digital transformation is all about and what Tahzoo is all about. 
The way that Tahzoo uses data to understand customers and their expectations of the customer experience is unique. We see people in the context of the type and style of content they prefer to consume. We use data from many different sources, web analytics, social data, and behavioral data to understand the format and then the semiotics of the content required to influence behavior or provide a more pleasing experience. With our ability to implement sophisticated content management systems, we can use insight and data to deliver a differentiated customer experience. This is markedly different than the traditional model of understanding people by age or income or other demographic metrics. With the rise of the web, agencies moved to personas rather than demographic models, however, they are utilized to inform the creative experience and not the personal experience. We use data to understand people or discreet audiences, in an effort to provide a more pleasing customer experience. We are actively seeking to understand the models of engagement. Without data science, we cannot deliver personalized or relevant content. We are more or less guessing. 
With all the talk of “Big Data,” the real trick is to make the data actionable. If we combine our expertise in building the integrated marketing platform with great data science, we create the possibility of truly connected experiences. We need to continue to innovate in this area and focus on bringing the art of the possible together for our clients. The future of Tahzoo depends on it. 
Let’s go be great! 

Storytelling: Ultimate Truths

“One must still have chaos in oneself to be able to give birth to a dancing star.” – Friedrich Nietzsche 

Storytelling: Ultimate Truths 

For two days this week, I brought a few members of the leadership team to Washington to focus on business development. The meetings were broad-ranging and very, very constructive. We really explored Tahzoo from the bottom up, discussing everything from the core promise we make to our customers to what differentiates Tahzoo from every other customer experience agency out there today. 
I believe great brands are about finding and sticking to a few ultimate truths that drive every decision a company makes from what products and services to offer, to how those products and services are designed, to who you hire, and ultimately which clients you choose to work with. Such ultimate truths are not always stated so much as they are embodied, they are lived every day by the leaders and employees of the company. 
The outcome for all employees of Tahzoo all of whom should consider themselves salespeople is a consistent, compelling, and unified story and the necessary tools to tell that story over and over with conviction and in the same way every time. 
Sales is storytelling. It’s giving our clients the emotional capital they need to choose Tahzoo that goes along with all the very real practical (financial) and logical (capability) reasons they might choose any one of our competitors over us. This emotional connection is what sets us apart. If we get it right, no one can stop us.

While the team is distilling everything, there are certainly many highlights I can share from our discussion. We began with an exploration of The Tahzoo Promise. There are competitors out there who sell on creativity. There are others who sell on rock-solid technology. Others sell on value. These are all good things, but they aren’t ownable. No one company can lay claim to being the only creative-, the only tech-, the only value-driven provider out there. A brand promise has to set you apart as different.   

For Tahzoo, I believe that our difference is the strength and quality of our relationships. So, any truthful Tahzoo Promise has to begin there. Again, however, that’s not enough. Plenty of companies talk about partnerships and relationships, but what sets Tahzoo apart is our people. We employ smart and happy people. 

Our promise to our clients then is something along the lines of Tahzoo is the company with smart, happy people who are interested and invested in the marketplace of ideas. You’re going to enjoy working with them. They are going to enjoy working with you. We’re going to put you ahead of us. We’re going to take great care of you. Together, we are going to do great things. 

Now, that’s just a paraphrase of some of the things we heard this week. A more formal Tahzoo Promise will be forthcoming, but I can pretty much assure you that you will recognize many of the attributes I just cited when we roll it out in the next few weeks. You should begin to think about how you fit in that promise. You were hired because you were smart and happy. Think about what that means to Tahzoo and to our clients and begin work with that perspective in mind. 
We also discussed the Tahzoo Pitch as exemplified in our current sales decks. We realize that too often people aren’t working from the very latest materials, nor are they telling the same story. To our clients and potential clients, Tahzoo sometimes appears disjointed and amorphous. Our clients can‘t tell who we are. We need to tell the same story, in the same way, every single time we tell it. 
Accordingly, there will be a new streamlined, highly visual Tahzoo Pitch deck coming out that focuses on the brand promise I described above and Tahzoo’s Differentiation along with six key facets of our business: Audience, Data, Business, Experience, Content, and Technology. 

There will also be concise explanations of Tahzoo’s History as an alchemy of my experiences at Nordstrom and Microsoft to highlight how the mathematics of Tahzoo is great customer service + data insights + killer technology = changing the world. Hand in hand with that story is the story of the Tahzoo Name. Many of you are already familiar with my six principles of a great company name, but if you aren’t, you soon will be. Our name is every bit as important to who we are as a company as is how we came to be and even what we do. Every employee needs to know these stories and be able to tell them with conviction. 

Last, of course, we will be developing a core group of six (or so) key Case Studies, including reference-able client testimonials complete with names and contact information, to tell both the story of what it’s like to work with Tahzoo, but also the business results we deliver to our clients through our innovative work. 
Best of all, we are not just releasing a new pitch deck and some case studies upon the company, putting them on SharePoint and wiping our hands of it.  We plan to train everyone in telling the Tahzoo Story. To that end, we will be producing a series of short videos of some of our best salespeople: me, Dave, John, Dom, Egbert, etc. giving the pitch as if to a multi-million-dollar client. You will learn not only The Tahzoo Story but how it should be told and how different salespeople can present the same material in different ways to achieve the same result a closed sale. 

The goal here is not to create sales robots, but rather I hope it will allow you to see how you can adapt our story to your personal storytelling style and yet keep the brand consistency we need to succeed and grow across the globe. Being clear, being confident, and being consistent in telling The Tahzoo Story is the key to Tahzoo’s future. With everyone on the same page, we can’t help but go do great things. 
Let’s go be great! 

The Myth of A/B testing

“The journey is the reward” – Peter M. Senge 

The Myth of A/B Testing- Let us now praise famous data scientists 

Most websites are terrible at selling. As both a customer and as a consultant, I know it. You know it, too. The problem is two-fold. First, insulated by the law of large numbers, online marketers have gotten away with being terrible salespeople because of a failed thinking that if they churn through enough people, eventually some portion of them (usually a minute portion) will convert to customers. It’s a volume business. It’s also a totally expensive, inefficient, and ineffective way to market. 

The shotgun approach flowed out of the ancient art of direct mail and telemarketing in which scads of letters and carefully scripted phone calls would blanket the countryside in hopes of converting a few recipients into paying customers. In that world, a conversion rate of one percent—just one customer for every 100 letters or calls—would be thought a resounding success. Do you know any floor salesperson who would consider themselves successful if they converted just one of every 100 customers who came in their door? Exactly. Neither do I. 

Nonetheless, the direct marketing industry has thrived. To them, the concept of sophisticated data science was encapsulated in a technique known as A/B testing. A certain portion of the letters or call scripts were ever-so-slightly modified. They might have used different headlines, or different inducements on the envelopes to get you to open them, or the offer might have been tweaked. The marketers then waited to see which letters or calls performed better. In this world, a difference of a few hundredths of a percent was read as if oracles from heaven that one way of saying things was better at selling the product than the other. The phrasing that performed better in this simple, side-by-side comparison became the standard against which future words were tested. 
In the advertising world, this reality is reflected in the traditional frequency and reach data models that define the success of marketing campaigns by how many and how often people experience an advertisement, not how many of them convert to customers. These models were born in an era where the majority of people had fewer than ten channels on their televisions and a handful of brands from which to choose. Firms focused on brand marketing simply because channels and technology did not provide bandwidth for anything else. 

Accordingly, companies spend increasing sums on traditional marketing initiatives, only to experience diminishing returns on investment—they spent more and got less. Traditional campaigns struggled to connect with consumers, and, when they succeeded, very little real information was communicated.  Though the least-informed customer can pinpoint the problem, the self-appointed experts cannot articulate a cause. Let me tell you right now, the era of A/B testing was built on a myth. It is an incredibly unwieldy way to market. As I said above: it’s expensive, inefficient, and ineffective. I believe it’s ineffective because it treats audiences as monolithic. There’s no subtlety in the messaging, no ability to adapt to who the prospect is or what they are saying with unspoken language. On a sales floor or at a high-intensity sales pitch, the salesperson always reads the audience and adapts on the fly to the vibe of the customer. It is how selling gets done. I’ve done it a million times. (I’m doing it right now.) 

At Tahzoo, we believe that the era of A/B testing is over and that true data science and data-driven marketing is not only possible but critical to business success in today’s global marketplace. The maturation of both big data and content management technologies have reached such a level of sophistication that a new era of online selling is now entirely within reach. You’re witnessing our philosophy—the “Why” of Tahzoo—in action as we press our clients to get better at data science, to improve their technology infrastructures to prepare for personalized messaging in which the data we know about the prospect influences the content they see. You’re also seeing through acquisitions of cool technology such as Adnovate. 

So, forget A/B testing. The past is dead. The future is within reach. Our mission at Tahzoo is nothing short of changing the world of marketing through data and technology. Those disciplines have rung the death knell on that old era and marketers and marketing firms need to acknowledge they are no longer the sole gatekeepers of purchase-critical information. To effectively communicate—not merely to present—relevant and personalized content to drive consumer decision-making means that the floodgate to personalized content is opened, and firms must embrace it and invite consumers into a real and lasting conversation. When this happens—when marketing is truly aligned with customer needs—only then will customers be both engaged and educated. And that’s when great things can happen. 

The Experience Economy: Part 2

Consumerism is Dead

So, I’ve been thinking a lot about this word “experience.” It got me wondering, where does this focus on experience come from? Though it’s clearly been around for a long time, it’s only recently become an object of intense focus.

Think back to the era of great American consumerism—the 1950s through the 1970s. This was a time of huge post-war economic growth, the spread of the American dream, and suburban ideal. It was also a period of incredible growth in mass communications, too, most obviously with television, which created a sort of global community that inspired a series of famously shared experiences—Elvis, the Kennedy assassination, The Beatles, the man on the moon, etc. Camped out in their living rooms, people experienced these things together. And yet, while we watched these incredible transformative events collectively, we did so in isolation, in our own homes, the communication was one-way. If we wanted to talk about it—if we wanted to share our experiences—we had to wait until the next day at school or the office to talk about it.

Marshall McLuhan had it right. The medium was the message. The one-way, mass communication of television had a profound impact on advertising and marketing. This was the great Mad Men-era of push advertising. The goal of this sort of one-way communication was to convince people that acquiring stuff, lots of stuff, preferably the same stuff as your neighbor, was a higher purpose. If your neighbor buys a Cadillac; you needed a Cadillac. Thus was born the Age of Consumerism. More is better was the mantra. Eventually, new forms of communications grew, each one taking hold at a faster pace than the previous—VHS, cable TV, satellite TV, DVDs, PCs, cellphones.

With the advent of social media, however, things changed dramatically. As if overnight, Facebook and YouTube flattened the world. It was the birth of the sharing economy. Broadcast yourself, they said. Every meal, every vacation, every life milestone had to be documented and shared with the world. Suddenly, stuff you had didn’t matter so much as the experience did. The selfie culture was upon us. The Mona Lisa of this new era happened on Oscar Night when Bradley Cooper, Jennifer Lawrence, Julia Roberts, Meryl Streep, and others joined in that memorable selfie. In that instant we were all “friended” by celebrities we could otherwise never approach.

Rigid consistency is passe.

It was the signal of a larger trend. People stopped caring about the endless pursuit to acquire the exact same stuff that other people had. All this consumption left us empty and led to the conclusion that maybe more wasn’t better after all. Mass-produced consumer goods became less desirable. People started sharing cars, not buying them. Zipcar and Uber grew. Ford and GM looked for new ways to capitalize on the sharing culture. Mass-produced food declined, too. McDonald’s struggled. While many say it was because their food is unhealthy, you could look at it and say It’s because all their food is the same in every store in the world. The exact thing that McDonald’s was known for—rigid consistency—became passe. There was no experience to be had.

In response, we saw the rise of the fast-casual trend with companies like Chipotle and Panera, but even those companies are becoming too common and are now being replaced by a new generation of niche restaurants. In Washington DC, we have Cava Mezze, a Mediterranean-themed restaurant offering lamb meatballs, tzatziki, and harissa. The ultimate mashup of social media and fast-casual dining is the “food truck” where each day saw gourmet food peddled on different street corners, the location of which would be announced through social media. The food was great. The concept was great.

…But the experience was greatest of all.

Why should you care about CX?

“Don’t ask yourself what the world needs, ask yourself what makes you come alive. And then go do that. Because what the world needs are people who have come alive.”  -Harold Whitman 

What is CX and why should you care? Part 2 
My speech at the digital summit at Marquette University was very well received for those who followed the event or me on twitter yesterday, you got to see firsthand the enthusiasm we generated. There was a woman who was a digital sketch artist in attendance, and she drew some interesting summations of my speech- I asked her permission to include her artwork in this week’s edition of the company newsletter.  

I started the speech with a discussion around the value of experiences and how technology is allowing us to be in the moment but also transcend time. We now live in a world where not only do we have the pleasure of the moment but it can be recorded for all time. The ways in which we can capture the moments is ever increasing as well, we can use 140 characters, 6-second videos, or post it on Facebook to name a few. 

I then transitioned to a discussion around the value or the currency of sharing. In the experience, economic status is derived from the experiences you share. What matters most is not how much you have, but how good you have it. Spending money on a great experience will last you a lifetime. A recent study in the Journal of Positive Psychology Experiences said that experiences also lead to longer-term satisfaction. “Purchased experiences provide memory capital,” Howell said. “We don’t tend to get bored of happy memories like we do with a material object.

The rise of the sharing economy is being driven by the idea that renting is just as viable as owning. We see many new businesses leveraging idol inventory or assets, ZIP car, streaming music, or sites like bag, borrow, and steal as examples. This notion of use when you need it is much more efficient and has profound implications for global manufacturing. For each ZIP car in a major metropolitan area supplants 32 new cars. Over a 10 year period in the US, this has lead to approximately 500,000 fewer cars sold. 

I spoke about Tahzoo’s three truths for our new economy, Experiences must be shareable, authentic, and differentiated. To be shareable an experience, we must consider the variant of formats and contexts in which the experience would be shared. Providing readily available content that can be quickly appropriated for sharing is critical. Brands must be authentic, there are countless stories about how disappointed consumers are when they find out a seemingly spontaneous moment is planned marketing activating, I give the famous Selfie at the Oscars sponsored by Samsung as an example of this. Lastly, the experience needs to be differentiated, in this way it can be personalized, or at a minimum, it needs to be better than one size fits all. The days of the mass market model are over.

The Experience Economy is influencing every aspect of our life. As we engage with brands we are seeking to spend our money and make connections that are profoundly different than we have in the past. I spoke about how this confluence of technology and culture is impacting the way we buy, communicate, and do business. I gave an example of how Venmo is impacting what was once an awkward experience deciding how to pay a bill among friends has now been turned into a simple and easy process. How each of us is now a budding photographer, restaurant critic, and travel specialist, all of these new models are giving rise to a new type of company built on pleasant and seamless experiences; Uber, Airbnb, and Netflix to name a few.

Over the last five years, technology has made personalization at scale possible. We can now communicate with individuals delivering brand experiences that are tailored to be contextually relevant. We are using data to better understand the desires of each individual and recognize patterns of behavior that once understood can be utilized to deliver personalized experiences. 
Thanks to Andy Myers, Rhia Pumhirun, Gabi Macy, and John Kottcamp for all of their hard work and contribution to this speech. We have a white paper about the experience economy that we’ll be releasing in the coming weeks. As always feel free to share your thoughts or ideas about the new economy.

The Tahzoo Customer Experience

In my meeting with our client, I discussed this scenario as an example of how we have to understand consumers in context. Consumers have different patterns of behavior depending on if they are buying for their son or daughter. Hypothetically the customer, (let’s call him Jason) buys lots of products for this retailer both in-store and online. His son is relatively easy to buy for, minimal returns or exchanges. He’s on three sports teams and is always in need of clothing or equipment. His daughter is another story, she is 14 and very challenging to buy for. As a teenage girl, she is very particular about style and fit. He told me she returns or exchanges most of what he buys for her. These patterns of behavior would be recognized and addressed if he had a regular salesperson he worked within a store. They would make appropriate recommendations and would guide Jason through the purchase and potentially the return or exchange process. 

We know if he is browsing women’s jacket or men’s sneakers, these should inform the experience and the offers that are delivered. We have great data science skills at Tahzoo that can be leveraged to understand customers in context. When we think about helping our clients drive personalization it’s important to focus them on understanding their customers first rather than experimenting with A/B and multi-variant testing tools. If the goal is personalized experiences that are contextually relevant, we need to model the human to human interaction. Understanding someone first and providing appropriate responses second. Because of the availability of testing tools and how digital marketers are focused on creativity and content, it’s easy to understand why A/B testing is a dominant paradigm. However, at Tahzoo, we recognize that personalization begins with data and how we understand customers and patterns of behavior in context. 

This line of reasoning helped differentiate Tahzoo versus the creative agencies who are focused on aesthetics and design. I look forward to sharing more about this opportunity as it develops. 

Let’s go be great!