DM Magazine June 2021

8 ❱ 13 Interview Ten Reasons for with HubSpot’s Geodemography Scott Brinker Now ❱

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VOL. 34 • NO. 6 • JUNE 2021

THE AUTHORITY FOR THE DATA-DRIVEN BUSINESS

DRONES AS A MEDIA CHANNEL Is The Future Here Now?

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Vol. 34 | No. 6 | June 2021

Taking Content to New Heights with Drones

PRESIDENT Publisher & Editor-in-Chief Steve Lloyd - steve@dmn.ca DESIGN / PRODUCTION Jennifer O’Neill - jennifer@dmn.ca ADVERTISING SALES Steve Lloyd - steve@dmn.ca CONTRIBUTING WRITERS Hank Frecon Ian Benn Stephen Shaw Peter Cantelon Evan Wood Angela Civitella

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JUNE 2021

ANALYTICS

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10 Actions for Successful Transition to a (new) Leadership Role

CHANNELS ❯ 6

What Video Marketers Need to Know About Media’s New Currency

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Ten Reasons Why Geodemography is More Relevant Than Ever

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LOYALTY

Picking Up Speed The Stata of Digital Maturity

INTERVIEW ❯ 8

The State of Martech: An Interview with Scott Brinker, VP Platform Ecosystem at HubSpot and Editor of Chiefmartec.com

❯ 14

When Membership Has No Privileges

ECOMMERCE ❯ 18

Six Challenges with Non-Phone-Based Biometrics DMN.CA ❰

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CAREERS

10 Actions for Successful Transition to a (new) Leadership Role

BY ANGELA CIVITELLA

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ANGELA CIVITELLA is a business leadership coach and founder of Intinde. www.intinde.com

eeking the role of leader, no matter how large your team or whether you are starting a new job in a new firm or being promoted from within, is a challenging situation in the best of times. After all, no matter how you look at it from your side, to the people you are going to manage, in some way you are the new kid. All eyes are on you when you walk into a brand new company. Work culture? Do not know. Social culture?

Who knows? Policies and procedures? Some are formal, some are evolutional. And what are they?

All of these questions take on a different perspective and urgency when the role you’ve been hired for is that of a leader.

So, for kicks, you not only have to figure out all of the above, you also need to figure out what kind of leader you need to be for all those eyeballs looking to you for answers. Oh boy.

The pressure is on. You need to demonstrate your worth, the value you bring and why you’re being paid seven figures. Even though it is a given that you were tried, tested and true in your old role, this is a whole new ball game. And your flock needs some convincing that they need to follow YOU now.

For leaders in all situations, here are ten actions I’ve identified for a successful transition into a brand new scenario.

1. Ask away. Don’t be shy. You can’t never know too much. Ask away. Every person is a knowledge source for you. Managers, subordinates, and colleagues. State why you’re doing the asking, and show interest and that you are curious, about everything. If you show you’re genuine, everyone will want to help you. And you’ll forge new relationships along the way. Winning.

2. Strengthen your network. Be intentional about the network you have. Leaders get things done through other people, so be mindful who you include and why.

Put dedicated focus as soon as you are anointed. Give yourself 60-90 days to establish who’s in, and who’s out. Make connections and personalize them. Get to know your people’s personal lives and ask them what matters to them. Get to know your people on a personal level and be willing to talk about what matters to them — their families, their hobbies, their interests.

Personal touches, from bringing treats for celebrations to positioning people for advancement, show people that you care about them. They will reciprocate with their trust.

3. Understand the culture. If you come in wanting to change the culture, you need to understand it first.

Don’t get frustrated over frustrations and restrictions that you are walking into. Uncover the obstacles and navigate around them. Do this and you will build trust

❱ DMN.CA

with the people, making it more likely that they’ll be open to changes when you propose them. Demonstrate your interest and open-mindedness.

4. Show empathy towards the people you are leading. A new leader translates into change for people. So that means a heightened sense of fear and uncertainty. All eyes are on you to see who you are and what you are prepared to do for them. Communicate clearly, consistently, and frequently so they get to know you. Manage expectations and make it clear to people what you bring.

5. Show yourself. Do not, I repeat, do not hide in your office. You really need to be present and accessible to your people so that you can build relationships and get to know the people and the culture. Walk around, engage in informal conversations, as well as scheduling more formal discussions. Note what you observe and talk to your manager or a mentor about your observations.

6. Pause before going forward. You have ideas and you’re ready to make a difference. But before you charge ahead, step back into learner mode. Too many changes too fast can scare people and create resistance. Start with a soft touch by making suggestions and asking questions. Give your team the opportunity to get comfortable enough to start sharing their expertise and guidance. Huge trust builder if you go at it slowly and surely.

7. What’s important. Learn how to triage demands made on you so you can tackle the most important issues and work your way down. Know what to delegate, and what to postpone. Avoid feeling the pressure to move too quickly to action. Instead, observe, listen, and then take action. Be smart about it.

8. Little wins matter at first. As you get to know the organization and formulate a strategic plan, look for quick wins that you can realize in the short term. These wins can motivate people and build trust.

9. Deal with conflict right away. You may ruffle some feathers at the start. Some may feel they deserved to be the leader. You may not “connect” between what you were told during the hiring process and the reality you encounter on the job. The only way to handle conflict is to address it directly and right away.

10. Breathe. You aren’t going to have all the answers—at least for a while. And you’re going to make mistakes. So, be your best ally and give yourself permission to learn.

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CHANNELS

What Video Marketers Need to Know About Media’s New Currency

BY HANK FRECON

I

t’s estimated that digital advertising grew 12 percent over the last year, as many people were at home more during the pandemic. With billions being spent on trying to reach people as they watch videos, it only makes sense that marketers turn to new technology to advance key messaging to targeted consumers.

We think leading the way in helping them maximize their revenue with media’s new currency is vital, that’s why we came up with SAMs or Source Activated Moments. The idea was to create an innovative platform is helping

companies stop wasting money and get more out of their video advertising efforts.

Many marketers are frustrated because they are spending more and more on digital advertising but are not seeing the results they want.

These companies need to gain more control of their digital marketing efforts to get a result that justifies their expenditure. They need to understand how to grow their business, and at the same time give consumers what they are looking for in a seamless way.

When advertising campaigns are being switched to video platforms, we wanted to find a way to give

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businesses the data-driven, targeted data that allows more focused campaigns, providing what we think is a more effective way to offer their products or services to customers that have indicated interest during videos.

Here are five things to know about this new way to reach consumers through digital advertising, some of which may seem straightforward but it’s often not available or forgotten during execution and media channel choices:

1

New media currency (SAMs) focuses on not disrupting the viewer. People love to watch videos, but they have been turned off by the ads that interrupt what they are watching. Having a platform that will seamlessly allow targeted customers to watch a video without ad interruption, yet allow the marketer to promote something without stopping their video, can make a world of difference.

2

Many businesses turning to the new media currency are able to greatly increase their revenue, because we offer them an entirely new inventory to access to help grow their business.

3

Rather than traditional advertising working with particular networks, the new method of advertising works across platforms. This makes it easier for marketers to reach more people without having to put in more effort.

4

The more you know about the audience, the more you can tailor ads to them and improve engagement. The new media advertising platform helps advertisers get more insight into the audience, so they can use that

to improve user experience and increase engagement.

5

The new currency is completely changing how online video advertising is done, and it’s doing so for the better. We all learned a lot from the prior ways that video ads were done, and that information has helped to create a better experience for all moving forward.

We see our platform as a powerful way to help transform the efforts put forth by marketing teams.

We see it as a more efficient way of reaching audiences, increasing profits, and in getting the most from marketing budget investments. The platform quietly works in the background, gathering important data points about the person, so that it can provide a better user experience and increase engagement. We work with numerous major international companies to help create a more engaging and effective video advertising experience.

As a marketer, you need to thoroughly research the ways the new era offers you contextual commerce and advertising.

Offering the first in-video, contextually driven, frictionless acquisition experience, seek technology that allows content creators, owners, brands, and retailers to seamlessly engage with viewers across any device or screen in real time. An immersive approach to interactive we strongly advocate technology which inspires brand loyalty organically through continuous, personalized engagement, reducing audience drift while yielding nuanced measurements and substantially increased avenues for monetization.

HANK FRECON is the CEO of Source Digital.

JUNE 2021

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CHANNELS

Taking Content to New Heights with Drones

STAFF

W

ith the increasing demand for engaging content, there’s a company in Toronto called Door 24 which is helping Canadian businesses tell their stories from new heights.

Through collaboration with City Hova Inc, a group of seasoned aviation professions with more than 80 combined years of experience in aviation, Door 24 has made drone content safe and accessible nationwide and is now one of the only video marketing agencies in Canada’s largest city which can fly and manage the complexities and risks associated with operating drones.

The founder of Door 24, Franco Junior Recchia, has always had a passion for integrating creativity and technology to tell peoples’ stories. Franco originally started in the music business but quickly found himself behind the camera to produce his own music videos.

Through his natural and creative abilities, other musicians gravitated to Franco to get the same quality content. Franco quickly realized that he had a real talent and passion for making other people look like rock stars, rather than always being the person in front of the camera.

Through this shift in focus, Franco continued to refine his expertise in videography and founded his content agency, Door 24, in March 2019. Door 24 was created with the mission to apply innovation, technology JUNE 2021

and creativity to give clients the competitive advantage when it comes to improving their social presence and connection.

After a very successful first year (clients included Fairmont Royal York, Sweat and Tonic, Netflix, Hyatt Place, Make a Wish Canada, Chotto Matte, Amazon, Mercedes Benz, Spotify, PSR Real Estate Brokerage and more) Door 24, like all Canadian businesses, was hit with a pandemic that no industry could properly plan for.

Despite the challenging times, Franco recognized that this was an opportunity to take content and visual storytelling to the next level and that there was never better time for businesses to connect with their audiences virtually.

Throughout the last year Door 24 continued to push the envelope when it came to engaging social media and website content and even supported local small businesses along the way. Never missing an opportunity to see how content could be taken to the next level, Franco recognized that there was a gap in the market when it came to working with drones in a safe, legal and accessible way. Due to the demand for cinematic-aerial footage from Door 24’s clients, Franco set out to find a solution on how to make drone content a part of the Door 24 business model.

While Door 24 and Franco were dreaming how to take content to new heights, Franco’s close friend and real estate agent client, Christian Ilumin, was hard at work

Franco Junior Recchia (second from right) and his team turn a talent into making people look like rock stars into a new way of powering content.

on the launch of a new business, City Hova Inc..

Christian had many years of aviation experience and used this experience to team up with other seasoned aviation professionals to launch a commercial drone business (primarily for security and delivery services), City Hova Inc..

When City Hova Inc., officially launched it did not take long for Christian and Franco to put the pieces together that a division of City Hova Inc. could be focused on drone content creation.

With Franco’s creativity and expertise in capturing visuals and City Hova Inc.’s team of aviation professions, a new division of Door 24 officially took flight. Through this collaboration, Door 24 and City Hova Inc. are now one of the only content agencies that can now safety and legally execute drone shoots in downtown Toronto.

To make the drone shoots as safe as possible, Transport Canada required drone pilots handle all aspects of drone operations including crewing, insurance, regulatory compliance, permitting, and flight safety.

This past month Door 24

and City Hova Inc. successfully completed their first drone commercial shoot for Hotel X which quickly went viral on TikTok (with over 830,000 views). The team really took pride in helping one of the hardest hit industries and plans to continue to support local businesses. This shoot was just the beginning of not even the sky being a limit for Franco’s content creation dreams. Door 24 and City Hova Inc. have plans to expand outside of Toronto this summer with the ability to fly these drones safety and legally nationwide.

So, what are bucket list Canadian locations for Door 24 and City Hova Inc? The Canadian Rockies, Parliament Hill, Peggy’s Cove (Nova Scotia), Lake Louise, Victoria and Fairmont Chateau Frontenac in Quebec City. If Franco’s ability to pivot from an up and coming musician to being an agency owner, one of the top videographers in Toronto and now launching this new drone division has proven anything, it is that he is committed to pushing the limits and achieving dreams, one frame at a time.

DMN.CA ❰

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INTERVIEW

The Executive in charge of the Platform Ecosystem at HubSpot is Scott Brinker, once the co-founder of an interactive content developer called Ion, now best known as the man behind the Chiefmartec.com blog who specializes in demystifying the world of technology for marketers.

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INTERVIEW

The State of Martech: An Interview with Scott Brinker, VP Platform Ecosystem at HubSpot and Editor of Chiefmartec.com

BY STEPHEN SHAW

W STEPHEN SHAW is the Chief Strategy Officer of Kenna, a marketing solutions provider specializing in delivering a more unified customer experience. Stephen can be reached via e-mail at sshaw@kenna.ca

JUNE 2021

hen the era of Big Data began in earnest a decade or so ago, marketing automation was suddenly seen by most businesses as indispensable. Gartner even predicted at the time that CMOs would eventually outspend CIOs on technology. And sure enough, technology now accounts for the biggest slice of marketing budgets, greater even than media spending.

Marketing technology has certainly come a long way over the decades, evolving from the standalone CRM systems of yesteryear, to the monolithic enterprise marketing suites of not-so-long-ago, to the cloudbased platform ecosystems of today, when there is an app for just about everything, including apps to connect the apps. What hasn’t kept pace, however, is the technical acumen of marketers, no matter how digitally savvy they may be in their personal lives. Too few organizations have reached the stage of maturity where they are graduating enough marketing technologists to take command of these wobbly “frankenstacks”. And too many marketers are still reliant on their IT staff to do the heavy lifting — the customization work, the application integration, the system connectivity, and so on.

That is probably why marketers struggle to make optimal use of their current platforms, citing complexity as the top challenge. Nowadays most companies have opted for a single vendor solution as their marketing platform of choice, whether that’s Adobe, Salesforce, Oracle, SAS or any one of a dozen other competing systems. But as Forrester observes, these are still made up of “separate components, deployed simultaneously”.

Often these platforms have to be augmented by multiple point solutions, usually in the range of 5 to 20 different add-on applications.

And of course, these platforms also need to be tightly connected to various internal “systems of record” which house the source data. The integration of all these various systems has always been a challenge. Recognizing the problem, the major martech vendors are broadening the scope of their platforms, seeking to natively integrate as many 3rd party applications as possible, connected through open APIs. The goal: personalization at scale. And making the integration of these disparate tools even easier are so-called “no code” development platforms that allow even non-technical users to create unifying processes across different applications using “drag and drop” interfaces.

DMN.CA ❰

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INTERVIEW Shaw: You’ve had your blog for over a decade. What was your motivation for starting it?

Brinker: Prior to starting Ion, I’d spent a number of years with a digital agency that would get hired by marketing to work with the client’s IT team. At the time there was a huge gap between IT and marketing — some people would say hostility between them — but to be honest, they just lived in completely different worlds.

They just didn’t understand what each other was trying to do. And so, the idea of the blog was to help marketing collaborate with IT and encourage non-technical marketers to develop more technical capabilities in their organizations. And then I found myself the champion of this new emerging class of marketing technology professional. But the original goal was, how does marketing adapt to a radically new environment?

You don’t have to build a billion dollar software company anymore.

You just have to find a niche.

HubSpot, the inbound marketing platform, is a great example of a hub-and-spoke system, with hundreds of third-party tools from certified partners, helping to make their solution one of the simplest to deploy with minimal involvement by IT for any small to medium-size business. The Executive in charge of the Platform Ecosystem at HubSpot is Scott Brinker, once the co-founder of an interactive content developer called Ion, now best known as the man behind the Chiefmartec.com blog who specializes in demystifying the world of technology for marketers.

Stephen Shaw: After running your own SaaS company for so long, what made you decide to make HubSpot your new home?

Scott Brinker: One of the recurring themes of my blog has been the growth of all these apps in the martech landscape. I knew that one of the real challenges for marketers was the lack of integration between these apps and the major systems which form the foundation of their martech stack. I felt that companies like HubSpot, Adobe and Oracle should recognize this as an opportunity to build a platform ecosystem and not just try to compete. Then the HubSpot founders actually reached out to me and suggested I put my money where my mouth is and help them make their system more of a true platform. ❱ DMN.CA

Shaw: Do you see your audience widening beyond marketing to encompass other areas of the company that share responsibility for the customer experience?

Brinker: That’s very much the trend I see.

What’s interesting is the technology is no longer just for marketing — it needs to enable the broader organization.

Shaw: I used to say that most organizations move at the speed of IT. But in this Year of the Plague, we seem to be experiencing a great technology leap forward.

Brinker: The year of the plague? Well said! Oh, my God, I will be so glad when this is behind us. Yeah, absolutely. I think one of the things that's been really interesting is how quickly an organization can change if they really have to, just to deal with the crazy circumstances they found themselves in. And while I’m sure none of us want to repeat 2020, we have the ability to adapt and change faster than maybe we gave ourselves credit for.

Shaw: On the subject of transformational change, you introduced “Martech’s Law”, where you postulated that technology changes exponentially while organizations change logarithmically. Can you explain that theorem?

Brinker: Imagine a graph with two curves. One shows the rate of technology change which is

exponential. It’s like Moore’s Law — computing power more or less doubles every two years or so. That’s an exponential growth curve. The other curve shows how quickly organizations change their processes, their internal structure, their culture, all those things. That changes too, but very slowly. If you take those two curves and juxtapose them, the distance between the two curves just keeps getting wider. They are woefully mismatched.

Shaw: In this past year, did you see a sea change in the willingness of businesses to get ahead of change instead of always chasing it?

Brinker: Yeah, I think it was change or die. The idea that we’re not going to make it through the quarter, much less the year, really forced people to make changes, and they did.

Shaw: When things get back to the “new normal”, will business lose their urgency to invest in the future?

Brinker: Whether it’s another pandemic, a brand new competitor, a new technology, or some other disruptive change, we have to continually invest in new capabilities that will help us adapt faster, whatever the threat may be, not just in a life and death situation.

Shaw: In your original “Martech Landscape” infographic, there were just 150 vendors pictured, I believe. Your latest one has 8,000.

Soon, you’re going to need an outdoor billboard to list them all. What accounts for this astounding growth?

Brinker: Twenty years ago, it was really hard to make a go of it in the software business. You’d need a bunch of capital, there were long development cycles, and then you’d have to figure out a go-to-market strategy using all these traditional expensive channels. Fast forward to today and everything’s in the cloud.

You’ve got Amazon Web Services, Microsoft Azure, Google Cloud, all of this world class infrastructure that makes software development super cheap.

You’ve also got all these open-source toolkits. And so, you have almost zero barriers to entry in the software market. You don’t have to build a billion dollar software company anymore. You just have to find the right niche and you still have a multi-million dollar business. Those kinds of possibilities just weren’t possible in the software space before. But supply is only one part of it. You also have to have a market for it.

And there’s been so much opportunity for new software because of how marketers want to JUNE 2021

Th be te he m te

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INTERVIEW engage their audiences. So, all this leads to a very expansive martech landscape.

Shaw: At some point, do you stop expanding a single martech list and just break it into its respective categories?

Brinker: Yeah, you’re reading my mind. I had to hire a team of nine people who spent three months working on our most recent landscape.

And I’ll be honest, I don’t know if the effort is worth it. Because let’s face it, it’s a conversation piece. A way to appreciate the scale of this industry. I hope to God nobody is actually using the landscape to throw darts at it to pick technologies. Is there an opportunity to break it into categories? I actually think that would be a much more useful tool for people.

Shaw: And then you have the enterprise marketing suites trying to be all things to all people.

Brinker: Yeah, I think it’s just hard for those companies to cover all of the use cases which is the fundamental reason why I think the platform strategy is the way to go. You do want one unified platform. But from a capability perspective, there’s a lot of specialization you want to support. Look at Shopify — I think they’re a fantastic example of this. Within their app marketplace, I think they’ve got something like 5,000 apps listed.

Shaw: Gartner says that most users are pretty happy with their martech stack, but aren’t taking advantage of its full capabilities. Why do you suppose that is?

Brinker: Utilization is the absolute wrong metric. Because, who cares? What matters are outcomes. If I’m only using 40 percent of the features, was it really a bad choice?

Shaw: There is that expression “frankenstack”, where you’re just adding stuff needlessly and creating all kinds of additional complexity. Forrester says that martech integration is the number one driver of success. Doesn't that suggest simpler might be better — that less is more?

Brinker: I don’t think this integration problem should be the problem it is, right? If you have to choose between one product where everything works together, but doesn’t do exactly what you want, or you have to buy a whole bunch of products that in theory will do exactly what you want, but you can't get them to work with each other, that’s a terrible choice. But why can’t it be a platform where you just plug in specialized functionality and get the best of both worlds?

Like we talked about with Shopify.

Shaw: In your book, “Hacking Marketing,” written four years ago, you say that complexity is the number one challenge of modern marketing. Do you still think that’s the case today?

Brinker: Yeah. And a big part of the blame for that lies with the martech vendor community.

We could be a lot better at making it easier for marketers. I do think the industry is improving, but I also think we’ve got a considerable long way to go. Because the full range of things that marketers can do with software is just infinite. The vendors should be in a position of helping to educate and empower marketers. This is one of the reasons why Salesforce has its Trailhead program, and we have HubSpot Academy, teaching marketers how to harness the value of these tools. That said, there’s this adage called Conway’s Law which says software reflects the team that built it. I believe there’s an inverse to Conway’s Law: very often we get forced into changing our business to match how the software creator thinks we should run it.

There is going to e another layer of echnology that will elp us govern and manage these other echnologies.

Shaw: It’s not just the technology that's complex: there’s inherent complexity in managing anytime — anywhere interactions with customers. Isn’t that at the heart of this challenge going forward?

Brinker: The past era was about Big Data: How do we get our arms around all this data coming

JUNE 2021

into our organization? The next challenge is going to be what I call Big Ops: How do we manage the operations of the business with all of these different elements running in parallel?

The very kinds of software that helped create the problem are also going to be the ways that we get through it. There is going to be another layer of technology that will help us govern and manage these other technologies.

Shaw: Is there a requirement to create a marketing technology office to bridge IT and marketing?

Brinker: Funny, that idea of a marketing technology office is actually why I started my blog. In fact, the blog is called Chief Marketing Technologist because I thought you needed a team to liaise between marketing and IT. I’ve now come to appreciate why there might be good reasons not to do that. Even though I think IT and marketing understand each other much better than they did 10 years ago, their accountabilities are very different. IT has an essential role in providing governance over the technology used throughout the organization.

You want to make sure that you’re compliant with data and privacy laws — to make sure that the SLAs [Service Level Agreements] are in place — to do the security reviews so that there are no big gaping holes. And some of these technologies operate across multiple departments. They need to be able to work across marketing, sales, and customer service and connect with ops and finance. And so IT is best positioned to run that common platform.

That said, a lot happens in marketing that IT has no need to be involved in. I just don’t think IT wants to be in the business of actually doing marketing and operations work.

Shaw: You talk about a second Golden Age of Martech. What do you mean by that?

Brinker: In the first Golden Age of Martech, you had this explosion of thousands of vendors, with everyone needing to set up a marketing ops team. That era was defined by three dichotomies. Suite or best of breed? You had to make a choice. Then you either had software companies or services companies, but nothing in between. And then the third dichotomy was build versus buy. And to be honest, those three dichotomies have been really painful. In the second Golden Age of Martech, instead of suite versus best of breed, you’ll have a platform as your foundation, and then you’ll augment it as needed with best of breed features that plug right in. I think we already see software companies offering more services and in the other direction services companies offering their own software. And then in the build versus buy decision, again that gets us back to platform ecosystems where you create your own custom apps tailored to the operational flow that is unique to your business. That’s why I think these next 10 years are going to be a pretty amazing time.

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// 13

ANALYTICS

Ten Reasons Why Geodemography is More Relevant Than Ever

BY EVAN WOOD

I

n May 2011, DM Magazine featured a Q&A with Jan Kestle, the founder and president of Environics Analytics.

The topic was geodemography and how this marketing science which had been around for 40 years continued to be relevant in an era of big data, rapid digital transformation and (supposedly) one-to-one marketing.

Ten years on, and with significantly more technology and data proliferation, geodemography is arguably more relevant than ever. While some may consider the practice old fashioned and even proclaim it dead, we can only respond by saying “Geodemography is dead. Long live geodemography!”

What is geodemography?

In its most basic form, geodemography is the study of people based on where they live.

Linking elements of demography, geography and sociology, geodemographic data and systems estimate (through models) the most probable characteristics of people based on the pooled profile of all people living in a small geographic area — often a neighbourhood — near a particular address. In other words, this approach provides a reliable, statistically valid and practical way to understand not only which consumers live where, but also how they live, behave, shop and think.

Originally developed in the 1970s, geodemography helps marketers, insights managers and JUNE 2021

business strategists in all industry sectors answer some fundamental questions: ❯ Who are my optimal target customers? ❯ How big is the universe of possible prospects? ❯ Where do they live and what are their consumption preferences? ❯ What are the best communication channels to reach them?

For all its advantages, geodemography has — particularly in recent years — suffered from a case of ageism and considered by some to be ‘old school’. In an era of artificial intelligence, algorithms, and access to slick platforms and consumers’ digital ‘breadcrumbs’, modelled neighbourhood-level data may not hold the same appeal as ‘real’ individual-level data.

But the fact is, this is a misguided notion. Geodemographic data and systems are more relevant than ever. Here’s why: 1. Access Data Not every business, NFP organization or government agency has unit record customer data. While large retailers, financial institutions and charities keep track of customers and donors, there are still large numbers of businesses that do not collect or have access to even the basic consumer information.

Census-based demographic data that is corrected, enhanced, national in scope and projected to the postal code is an easy and reliable way to understand

customers in fundamental terms such as age, sex, income, education and more.

2. Fill in the Gaps For businesses that have customer data, their databases are likely incomplete (or not as complete as they could be). Even financial institutions, who tend to have fairly comprehensive financial profiles on their customers, often lack insight on consumption behaviours, media preferences and consumer attitudes.

Geodemographic-based data overlays can enrich transactional databases and provide valuable, actionable consumer profiles.

3. Stay Privacy Compliant By their very nature, geodemographic-based data are privacy compliant. While based on actual data that are statistically accurate and a representative sample (e.g. StatsCan data), they are then modelled to a small area geography such as a postal code.

They are not individual-level data but provide a granular level of insight that help organizations understand consumer profiles at the neighbourhood level.

4. Understand the Benchmarks When trying to calculate penetration, share and the size of incremental market opportunities, organizations cannot rely on their own customer data alone — they need external data to provide the ‘universe’ or denominator against which they can benchmark their customers. National

geodemographic-based databases provide that benchmark and the ability to index customer profiles against the general population.

5. Capture Survey Insights Canada has a trove of rich survey data available from reliable national sample surveys (from government, marketing and media entities) on spending, media preference, technology adoption, leisure activities, tourism and many other aspects of day to day living. But these survey-based variables only become usable for trade area analysis and local marketing when they are properly linked to geodemographic-based segments. This allows an analyst to combine the survey-based measure by segment for a behaviour like “go the movies”, for example, with information on which segments live around a particular location to determine the viability of a new cinema.

6. Find the Best Prospects Mining your in-house database can help you identify potential cross-sell, up-sell and retention strategies for your current customers. However, geodemography is the easiest way to profile your best customers in your existing file across a comprehensive range of attributes and then quantify and locate prospects with a similar profile in the broader market. The more attributes you can use for profiling,

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LOYALTY

When Membership Has No Privileges

BY PETER CANTELON

I

f you are part of a memberbased, board-run organization (like a not-for-profit) and you struggle to get enough members to even fill your board then you need to ask whether your organization should continue to exist.

The traditional structure of a not-for-profit is as follows: members are the base of the pyramid, the strong foundation; members select a small group to implement and exercise the vision and mission of membership through the wise management of resources like money, property, volunteers and staff.

This structure is simple, elegant and eminently wise — when it works and operates within the spirit of how it was envisioned.

An organization starts as an idea.

This idea comes from a passionate person or people. These people, motivated by the passionate idea begin to work on implementing a vision to communicate the idea to the world. As part of this process more people are attracted until you have a movement, usually of volunteers, working and bringing unique talent and sweat equity to bear on the idea which has become a vision.

This group will often gather and pool resources in the form of product, property, facilities, money and more in their work unfolding the vision.

Eventually the group gets to a point where the value of incorporating (say as a not-forprofit) makes sense. It gives the group unique tax and funding opportunity and can help to take things to the next level as it requires infrastructure to be put in place — rules of operation like bylaws, a structure that enshrines the idea as a mission governed by people who report and ❱ DMN.CA

communicate in a certain required way that includes financial reports, regular meetings of a board, an annual meeting to report to members and provide opportunity to ensure leadership understands and continues to implement the will of those members who are the ultimate stewards of the idea.

Too often however organizations lose momentum for one reason or another. People lose interest, members drift away, communication slows down or stops, and strong systems of governance corrode or corrupt to a place where membership has no privileges or purpose.

Strong membership needed The key to a healthy organization is a strong and vital membership. The key to building this membership is planned, intentional work to constantly communicate the idea and its value and relevance.

Members must be invested in the organization. In for profit, board run companies members are shareholders and investors. They are literally, financially invested in the company and this gives them rights, the primary one being voting for a board of directors.

In a not-for-profit members must also be invested. Sometimes this is financial, sometimes this is volunteer sweat equity, sometimes this is tax dollars invested on their behalf by another organization they are members of — their city, run by the board they elect, their council.

Without a strong membership a board of directors becomes beholden and accountable only to themselves and devolves into a self-fulfilling coven focused on their own needs.

This is radically unhealthy and deceptively alluring as such a board becomes comfortable with not having to be held accountable,

not having to deal with members, failing to recognize that this is the only reason they exist.

The composition of a board is a reflection of the needs, priorities, and personality of the membership — if there is no membership, they reflect nothing.

Membership is the lifeblood of board run organizations, it is where an organization gets its vitality and creativity from. If it is anemic or non-existent the organization will ultimately suffer and the questions of “why are we here?” or, more frightening “why are YOU here?” get louder and louder.

Ultimately it comes down to one question for those left — how passionate are you about this idea?

Are you passionate enough to work to save the life or this dying beast?

Are you passionate enough to mobilize members and reinvigorate the body?

If you find yourself doing all the right things to draw members (communicate, listen, nurture, advertise, meet people, create opportunities to infect the community with your vision, outreach, etc.) and still there is no harvest then you must ask the most difficult question of all — is it time we close?

An idea is not necessarily forever. For all things there is a season. The only thing worse than riding a dying horse is riding a dead horse. Some ideas need to die so that they can rest a while and be resurrected as something bright and new otherwise you are just keeping a zombie.

Another option is to learn if your passionate community is elsewhere. Maybe the most passionate people about your idea are 100 km away and have a thing of their own? Maybe you should join with them to sustain your idea and passion until such time as local support reaches critical mass.

Perhaps being incorporated no longer works for you and you should consider shedding the status in favour of becoming a private business.

It is challenging to run a member-driven organization but it is member-driven for a reason.

It is easy to fall into the trap of believing that things would be so much easier if there were no members and you with five or six of your peers could make all the decisions accountable to no one — but this is a path that ultimately leads to irrelevance.

It is true, sometimes people become members of organizations for the wrong reasons. Sometimes members betray a motivation to harm or diminish the organization instead of help to build it up.

When this happens, a board has tools available to it. It can remove a harmful member like a surgeon removing a malignant tumor.

It can be painful but it leads to health. That being said a good surgeon does not cut off the entire arm when they can simply excise a 3 cm nodule.

Membership represents healthy boundaries to an organization and its board. Some think that unfettered freedom leads to unfettered growth but nothing could be further from the truth. In reality boundaries and constraints can lead to some of the most creative acts by organizations.

Food for thought based on one simple premise – nothing is more important to a board driven organization than membership.

PETER CANTELON, married father of three, lives and works in Morden, Manitoba and has been a writer and columnist for more than 30 years.

In this time, he has had the opportunity to be a part of countless non-profit boards in various roles and is most passionate about good governance and membership.

JUNE 2021

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CHANNELS

Picking Up Speed The State of Digital Maturity

T

he Brookfield Institute for Innovation + Entrepreneurship’s newly released report, Picking up Speed: Digital Maturity in Canadian SMEs and Why Increasing it Matters, was created in partnership with the Toronto Region Board of Trade, Scale-Up Institute - Toronto, and with support from Xero, a cloud-based accounting software platform for small businesses.

For any firm working with SMEs or looking to help them scale up or even initiate their digital and online marketing efforts, the information revealed in this brand new report can provide a guideline for creating its own business model and strategy to engage this part of the market. Here’s what the report reveals and what insights it brings to the table for ad agencies, consultants, eCommerce platforms, content marketing specialists and digital-based services providers.

Ultimately, a company’s digital maturity hinges on its successful use of technology. While not every technology is relevant to every business, a range of them almost certainly are. Almost every company could benefit from use of a foundational technology such as having an online presence.

Important bridging technologies, such as cloud computing, or customer relationship management, might not be applicable for everyone, but they can have big impacts in terms of transforming internal operations. Advanced technology uses, such as AI, big data analytics, or the Internet of Things, might only be relevant to a much more select group, but even then, these technologies are likely to be useful to a much larger number of companies than those already deploying them. Finally, cybersecurity is not the sole concern of large corporations or banks with large financial assets. It is instead something that every company (and individual) needs to be aware of and only increases in importance as digital maturity increases.

Foundational technologies: Online presence, social media, and eCommerce Foundational technologies such as social media use, having an online presence, and selling goods and services online are often the starting point for SMEs to increase their digital intensity. These technologies are generally customer facing, though they can feed into back-office functions, such as through analyzing data from social media or eCommerce.

Almost every company could benefit from use of a foundational technology such as having an online presence.

The use of these digital technologies is driven by consumer demand. As of 2018, over 91 percent of Canadians aged 15 years and older were using the internet. Of them, 84 percent bought goods or services online, spending $57.4 billion.84.04 percent of Canadians also used the internet in 2018 for finding information about goods or services, the 6th highest rate in the OECD.The pandemic has only served to accelerate the use of eCommerce, with online sales up far more than in-store sales across the board, with growth far outstripping pre-pandemic levels.

JUNE 2021

DMN.CA ❰

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CHANNELS Yet despite these demand side factors, Canadian companies as a whole are not at the digital frontier when it comes to increasing the rate of adoption of these foundational technologies. As of 2019 Canada was solidly mid-table in the OECD for businesses with a website or home page, lagging behind the leader Denmark by just over 12 percent. When it comes to businesses using social media, it is a similar picture with Canada behind the leader Norway by just over 15 percent.

Canadian small enterprises, in particular, are lagging in their online presence. As of 2019, 17 percent of small enterprises have no web presence at all, and only 74 percent have a company website versus 91.5 percent for mediumsized enterprises and 95 percent of large enterprises. There is a smaller gap between small and mediumsized enterprises when it comes to social media use — 55.4 percent to 64.4 percent respectively, though both still significantly behind large enterprises with 74.8 percent having a social media account.

Gaps in baseline adoption Not only are there gaps in the baseline adoption of technologies, but also in the strategies around how they are used. Data from the March 2021 Environics survey commissioned by the Scale Up Institute Toronto shows that small enterprises are using social media for more basic uses compared with larger companies. For example, companies with 10-99 employees are three times more likely to report that their social media use is not designed for actively engaging with new and existing customers, verses companies with over 500 employees.

There is a mixed picture in terms of industries which have no web presence. Across the board, small enterprises lag behind mediumsized enterprises. This lack of web presence harms enterprises when it comes to selling products and services online. One area where SMEs are using the web in high numbers is in their procurement.

67.7 percent of small enterprises ordered goods or services over the internet in 2019, along with 77.4 percent of medium-sized enterprises and 81.3 percent of large enterprises. ❱ DMN.CA

Despite this, only 22.5 percent of small enterprises receive orders or make sales of goods or services over the internet. SMEs are apparently adept at making purchases online though not enough are taking advantage of the internet to make both business-to-business and businessto-consumer sales. Recent analysis highlights some of the trends in online sales during the pandemic.

Though, as noted earlier, there was a substantial growth in eCommerce during the pandemic, this was not matched by large numbers of enterprises shifting online. Indeed, in 2020 just 9 percent of Canadian businesses of all sizes made 60 percent or more of their total sales online, up just 3 percent from 2019.

Higher increase in sales online Businesses majority-owned by women reported a higher increase in companies that made at least some of their sales online in 2020 compared to all private sector businesses, though were also more likely to have reported a drop in revenue of 30 percent or more in 2020 compared to 2019 — speaking to the disproportionate impact of the pandemic on women despite higher levels of digital adoption.When it comes to proportion of online sales than in many other digital technology areas there is less of a distinction between SMEs and larger companies. There is almost no difference between enterprises with 20 to 99 employees and those with more than 100 employees in proportion of sales made online in 2020, with the smaller companies actually having a slightly higher proportion making more than 60 percent of their sales online — 9 percent versus 7 percent.

THE FULL REPORT is available from The Brookfield Institute. A key collaborator and author for this report is Dr. Thomas Goldsmith, an independent researcher and policy consultant collaborating with the Brookfield Institute. Tom works with innovation-focused organizations to help them understand public policy, and create coalitions and partnerships to help build an inclusive innovation economy in Canada. Report created in partnership with the Toronto Region Board of Trade, Scale-Up Institute – Toronto, and with support from Xero, a cloud-based accounting software platform for small businesses.

Ten Reasons Why Geodemography is More Relevant Than Ever CONTINUED FROM page 11

the more options you can open up for finding those attributes in the marketplace.

7. Segment Your Customers Many organizations have an internal customer segmentation system based on their own available data. While potentially useful within the confines of their own organization, these segments are often hard to link to external data, limited in their descriptive profiles and challenging to seamlessly activate in media channels. On the other hand, a geodemographic based segmentation system such as PRIZM is distinct and easy to understand, can be mapped to every postal code across Canada, links to thousands of other disparate behavioural, financial, psychographic and demographic variables, and as a result, can explain and accurately predict consumer behaviour.

8. Move From Insight to Action Geodemography allows for the harnessing of a broad spectrum of data to generate insights but more importantly, to provide insights that are actionable.

While other data sources can provide snippets of consumer insight and point-in-time views on behaviours, only geodemography can effectively link the customer, product and brand profiles to use cases such as site selection, local marketing (including traditional and digital channels), customer services, merchandising, category management and media planning and execution.

9. Be Digital, Cookies or No Cookies Marketers looking to target customers across digital channels can (and should) harness geodemographic segments as part of their marketing mix. Not only can these segments be targeted based on a comprehensive range of behavioural attributes and media preferences, they can also be engaged more effectively by leveraging psychographic

insights into relevant messaging and creative. And given that geodemographic segments (and defined targetable audiences) are available at the postal code level, the pending disappearance of third-party cookies becomes irrelevant.

10. Get Results That Are Measurable Because marketers can tie geodemographic segments back to the ground (stores, postal codes, markets, etc.), to purchase channels and to their own transactional data, the impact of marketing campaigns or other internal initiatives (e.g. customer service or product changes) can easily be measured and modified on an on-going basis.

Some predicted in the late 1990s that the move to CRM systems, one-to-one marketing and household level models would mean the end of geodemographic based data and systems. More recently, others have suggested a similar demise with the proliferation of big data and advances in machine learning and AI. Neither has turned out to be true…and with good reason.

Geodemography has a long history with proven value across all sectors: Banks and insurance companies use it to develop products, services and messages that increase client retention through cross-selling and upselling; Retailers use it identify underserved markets and areas where operations should be combined or curtailed; Fundraisers use it to focus on potential donors that are likely to have the highest response to their direct marketing campaigns; And governments use geodemography to ensure that the right services are available in the appropriate areas. There’s no question — geodemographic-based data and segmentation systems are alive and thriving.

EVAN WOOD is EVP and Chief Strategy Officer of Environics Analytics, Canada’s leading data analytics and marketing services company. He also leads EA’s Financial Services practice group.

JUNE 2021

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Six Challenges with Non-Phone-Based Biometrics

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Sales Leads

4. Costs Are High for Non-Phone Based Facial Recognition Most solutions in use today need a high-quality camera, considerable processing power and greater internet bandwidth. Facial and iris reading also depends on the right ambient light conditions, making the technology difficult to roll out in many circumstances. Cameras usually need to be mounted at face height which can be challenging in an in-store environment. All these conditions, though achievable, are expensive to implement and are difficult to roll out.

5. Limitations with Face Recognition Facial recognition has come a long way but there are still many challenges with the technology when it comes to non-phone-based devices.

From a payment environment standpoint, ambient light is a key factor since bars are often dark and retail stores can be overly bright in North America. This can govern what type of business opts for this technology. Another key limitation with facial recognition technology is skin tone. Research has shown that facial recognition is more accurate for white males and considerably less for dark skin toned females. One of the common inferences from the 10:43 AM research reveals that 13-07-04 the AI behind the platforms often uses the internet for source “learning” comparison data. As the population of faces on the internet is more skewed towards white and male images, there is a correspondingly more robust data set. There are also concerns for disabled users for more obvious

reasons as well as countries where face coverings are common (although iris recognition is a potential solution here). In short, facial recognition is far from universal.

6. Fingerprint Adoption Is Likely to Be Set Back By COVID-19 Attitudes to physical contact have changed since the COVID-19 pandemic and the acceptability of public fingerprint readers may be affected for the foreseeable future.

Fingerprint readers on personal phones, on the other hand, are not affected by this.

Future of non-phone-based biometrics In markets such as China, where the adoption of facial recognition is high, special terminals equipped with super-high-resolution cameras and extra processing power can enable acceptance. However, I believe that the widespread international availability of such technology will depend on market standards. In countries where there is a lower penetration of smartphones, there is a lot more interest in a fingerprint as a relatively low-cost way to identify a consumer. Wider adoption of this into mainstream payments will depend on technology standards and on people’s willingness to use something touch-based.

We expect to see more use and acceptance of non-phone-based biometrics over time as standards for it emerge and consumers are satisfied with the security and reliability of the experience but in the meantime, the phone-based model provides a very easy bridge.

IAN BENN is head of Strategy and Market Development at Ingenico.

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ECOMMERCE

Six Challenges with Non-Phone-Based Biometrics

BY IAN BENN

T

here has been a tremendous amount of conversation recently around biometrics and its role in payments. The idea that your customers can pay for goods and services without having to carry a wallet, or even a phone, has competitive advantages, but what’s the current state of play? And where are we headed?

What is biometrics and what are the types used in payments? Let’s start with a definition. Biometrics covers the measurement of any aspect of our physical human characteristics — from the unique shape of our face or fingers to our DNA. Fingerprint scanning has been in existence for a long time and is one of the most popular biometric data points used for authentication: from immigration at an airport to unlocking your phones.

When it comes to payments, many methods that read biometric data are reliable, but not all are easy to manage or socially comfortable for consumers to use. Over the years, the payment industry seems more focused on two main approaches: Fingerprint analysis and Face/eye recognition.

Both approaches are based on what today’s consumers are already comfortable with. Most high-end laptop computers are equipped with fingerprint scanners for better security. And if you look at the latest smartphones, they too have similar technology to use fingerprint or face scanning for security purposes.

How do biometric payments work?

Biometrics is used in payments mainly for authentication purposes. Data such as fingerprints, face/eye scans can help verify the identity of the person paying. It all works in two main ways: ❯ The first is by customer authenticating their identity on their device (for example, approving a transaction on a ❱ DMN.CA

❯

smartphone using the inbuilt fingerprint reader or face ID).

This method is most common nowadays with mobile wallets that use fingerprint scanning or face ID to help customers pay with contactless technology such as Apple Pay and Google Pay. The second uses in-store hardware to capture the image, typically a high-definition camera and a large screen or a modified payment terminal that can capture this information.

Though uncommon in North America, this in-store hardware can not only be useful for payment acceptance but may have other applications in the future, such as identity and age verification.

Phone-based biometrics are Simplest and most popular In almost all markets, the preferred model is using the phone for authentication. This is driven primarily by consumer confidence in the technology. A typical consumer is happy to have their biometric information stored on a device that they own — as it seems they have more control over it compared to an external device.

The secondary driver is cost. If the smartphone is handling the biometric identification, then, once approved, the transaction can flow to a standard POS terminal via NFC as a standard contactless card or mobile wallet transaction. For merchants, this means that they don’t need to make any changes to their POS system or get any complex development work done for the payment service provider.

Non-phone based biometrics are complex As you move away from smartphones to non-phonebased biometric payments, the level of complexity increases for merchants. There is a lack of standards which makes the rollout of this technology internationally very difficult for manufacturers and implementation costs can be

high, so merchants can be deterred from considering this option altogether. For now, non-phonebased biometrics creates more challenges for merchants who wish to adopt this technology.

What does this mean for the future of biometric payments?

In North America, biometric authentication is real and already happening, but mainly on smartphones. In this case, there is very little impact on a merchant or a technology provider. The smartphone may be running powerful and complex analytics in the background, but for the merchant, they simply see a contactless transaction, one that may be at a higher transaction value than they might normally be able to approve.

In the recent past, I’ve talked about the rise of biometric authentication in typical payment environments. That market is currently dominated by phonebased biometrics where consumers authenticate the transfer of payment information on their device via a fingerprint scanner or face ID. For the merchant, it is a simple contactless transaction.

Non-phone-based biometric payments, however, are more complicated. They generally require merchants to own payment terminals that are equipped with hardware and software powerful enough to read biometric data.

While interest exists in nonphone-based biometric payments in certain countries around the world, implementation has barriers and options.

Here are the six main challenges.

1. Lack of Standards Make Rollout Challenging Security standards are critical to the widespread adoption of any technology. Today, all the biometric payment solutions are tied to a single provider, each of which chooses to set its own standards. The privacy of personal data is enshrined in protective

laws in almost all jurisdictions and these laws often lag technical change. Whilst the principles and purposes of data protection laws are consistent, their application and specifics are not necessarily.

Both factors make widespread rollout challenging for any technology provider.

2. Concerns Over Biometric Data Privacy Biometric data privacy a major market inhibitor. In many countries, we have seen concerns from consumer groups and governments where biometric cameras have been used for security or marketing purposes and governments also remain cautious over the creeping commercialization of such data.

Strangely, while consumers are expressing strong hesitancy about their image data being held for non-phone-based biometrics, the level of concern on the phone is far lower even though data is often held in the cloud. Maybe this is because many of us see our phone as an extension of ourselves – our brain’s external hard drive.

3. Biometrics Are Hard, But Not Impossible to Crack Hackers have shown that it is possible to fool security systems that depend on fingerprint and even iris scanning with low-tech solutions based on high-quality photographs. One, for example, was able to beat an iris scanner simply by sticking a photograph of an iris to the inside of a hard contact lens to emulate the shape of an eye. Another popular video shows a shopper in China using face recognition at a self-service kiosk – as she bends down to tie her shoelace, instead of the camera scanning her face it simply recognizes the man behind her in the queue who is distracted by his phone and is billed for her purchases. The serious issue with biometrics is that, unlike with a CONTINUED ON page 17 JUNE 2021