The three types of evidence-based marketing.

When I hear the phrase "evidence-based marketing," I like the sound of it -- but what does it mean, exactly? I see people doing three types of things that could be labeled as such:

1. Using evidence to figure out *how* you should do your marketing.
2. Marketing your evidence.
3. Gathering evidence that helps you figure out *which products or services* you should be marketing.

I believe marketers need (deserve) better ways to consistently access solid evidence -- so creative, open-minded people could apply evidence-based marketing in more situations. Another obstacle is when there's a big  disparity in the handling of type #1 and type #3 evidence, which can lead to scenarios like this: A new product's sales fail to live up to expectations, so R&D says "It wasn't marketed correctly." while Sales/Marketing says "R&D built the wrong product."

Type #1: Figuring out how to do marketing. Paul A. Barsch writes about using evidence in Fortune 500 marketing, referencing Pfeffer & Sutton's 2006 book on evidence-based management (already familiar to many Evidence Soup readers -- previous coverage here). He concludes by asking: "How many marketers do you know that are constantly reading the latest marketing research? How many are reading management and business magazines, or even better, reading articles and research outside their field of discipline with the hopes of finding some applicability and inspiration for their current marketing challenges? No, too often, we’re making marketing decisions based on obsolete knowledge or our past experience. However sometimes that experience isn’t applicable to the new situation."

Tom Davenport has a recent book about Competing on Analytics by using business intelligence to pinpoint the most profitable marketing strategies: Using hard evidence to reassess old assumptions and ideas, instead of just going on intuition.

John Mack, editor of Pharma Marketing News has blogged about evidence-based pharma marketing and notes that the phrase evidence-based marketing is sometimes used in a derogatory manner, as in "we must ensure that treatment is based on evidence-based science rather than evidence-based marketing." But he notes that evidence-based marketing can help people fine-tune their efforts: "Let's take one of my favorite examples - the ED (erectile dysfunction) market. I have complained before that pharmaceutical marketers ...overestimate the size of the market in comparison with government (NIH) estimates. Since these drugs have serious risks associated with them, the marketing, which is decidedly NOT evidence-based, serves to expose a larger than necessary population to these risks.... Some experts argue that targeting a more appropriate market through evidence-based marketing leads to less income, but the income is of higher "quality." Quality revenue is a well-understood concept in the insurance industry, which will typically carve out risky populations and deny them coverage."

Type #2: Marketing your evidence: When you issue white papers, press releases, advertisements, etc. touting a new research discovery, technology advancement, ROI study, etc., you're marketing your evidence. There's no shame in promoting legitimate evidence that is useful to potential customers (some should probably be ashamed of how they go about it, but I'll save that for another day).

Type #3: Figuring out what products to market. Sometimes "evidence-based marketing" refers to the third category. For example, the folks at Evidence-based Business do rigorous marketing research to clarify customer attitudes, validate demand, etc., to help people decide what services they should offer in the marketplace. I'm guessing this type of evidence-based marketing is most familiar to people.

Bottom line: Any company that does lots of R&D and lots of product marketing can, and should, do all three types of evidence-based marketing. The trick is defining what forms of evidence are considered acceptable, and establishing guidelines for handling evidence consistently.

Comments

[Paul A. Barsch]

Tracy, I like how you broke up the three categories of evidence based marketing. You are right, #2 and #3 are the most commonly used in marketing. #1 is hard because it asks us to challenge what we think we know and apply new thinking to current and future challenges. Marketers like what we like, and trust what we know. A fresh approach is often warranted.

[Tracy Allison Altman]

Philip Tiongson posted a good addendum to this post on his Organized Chaos blog. The key point: "The comment on R&D and Sales/Marketing is just the tip of the iceberg. In my case, it's always Sales versus Marketing. Sales people believe that they have all the power and that they should be in control of the marketing of the product/services; sales people also believe that they deliver hard results - and therefore, evidence. On the other hand, Marketing people believe that they are not just preparing for the near-term; they are supposedly "custodians of the brand and its future". Hence their evidence is more about leading indicators (e.g., brand recall, brand image, customer satisfaction, consumer's perceptions of the brand)."

[Mike Kennedy]

Tracy, I believe you are absolutely correct that the best evidence-based marketing approach includes all three types of market research. All evidence-based marketing should start with the hard facts and involve a commitment to conduct and monitor scientific studies about consumer attitudes and behavior (see Paul Barsch's blog); AND include the building of effective marketing and sales strategies using evidence-based findings.

As you mention, the tug-of-war between sales and marketing often revolves around time horizons. Sales people discount the future when it comes to marketing and marketing research, much the same way someone puts off getting in shape until next week, next month or next year. Why sweat now for something that won’t pay off until sometime in the future? As we know, there may not be too many “today’s” in the future if present day decisions are based on tradition, intuition, gut feelings and short sightedness; particularly in today’s hyper-competitive markets.

Perhaps letting an evidence-based approach play a larger role in the strategies formulated at top-level board meetings would help get everyone working within the same time frame to achieve sustained growth. Let’s hope so.