If marketing was a manufacturing process, business would never survive. The current standard in the manufacturing world, and many other industries, is six sigma. This means that for every 1,000,000 opportunities there are less than 3.4 defects.1 Put in marketing terms, this would be a conversation rate of 99.99966%. The chart below shows some typical conversion rates of different media outlets. As you can see nothing even gets above 10%. Even a broken clock is right 8% of the time. Admittedly, there are some media outlets, campaigns, and industry that can combine to do very well. However, Unbounce conducted a test and found that a 12% conversion rate of landing pages put a company in the top 10 percentile.2 This is based off the few people that made it through the other conversion rates to get to your landing page. Will we ever get to a six sigma conversion rate, no. But that does not mean we should not try. So how can marketing improve?
The Just-In-Time (JIT) concept has disrupted the logistical and manufacturing processes since the 80s. This same process, having the right item at the right time, can be applied to marketing in the form of limiting the 95% of inventory, customer touch points, that never produce. Customers and companies want to use the mass amounts of data the Information Revolution has produced to have a more personalized experience. Big data, AI, and the Internet of Things (IoT), are all tools that can be combined to achieve this JIT Marketing (JITM).
There are three dimensions that a company needs to excel at to be successful in JITM. One, customer knowledge to plan and execute off of, big data. Two, using AI to find the correct channel capability for the optimal communication and value propositions. Three, using a vast real-time flexible marketing mix to get the message across the customer’s IoT.6
How does this look in practice? It starts with the airline company logging that I always drink sprit, so they hand it to me without me asking. Then I give them more of my data for them to build a picture of ME, not a persona of a market, but me. Then their AI scans my travel times, locations, and the weather to offer me a promotion to that scuba diving getaway I have always wanted at just the right time. Finally, it sends the offer to me in the evening, over my phone, because they know that is when and where I do my shopping. The startup cost is high for this process. However, the money would come from the billions of dollars saved from mass marketing. Also, like no other time in history, data and technology allows companies to gain economies of scale of personalization.
- Six Sigma. “What is Sigma and Why is it Six Sigma?” https://www.sixsigma-institute.org/What_Is_Sigma_And_Why_Is_It_Six_Sigma.php. Visited 5 November 2020.
- Unbounce. “What is a good conversion rate for a landing page?” https://unbounce.com/what-is-a-good-conversion-rate/. Visited 5 November 2020.
- Priceonomics. “The Advertising Conversion Rates For Every Major Tech Platform.” Forbes. https://www.forbes.com/sites/forbes-personal-shopper/2020/11/05/kohls-black-friday-2020-everything-we-know-so-far/?sh=21e664661397. March 9, 2018.
- Srinivasan, Anand. “Conversion Rates for the Most Popular Marketing Channels.” Entrepreneur. https://www.entrepreneur.com/article/244225. April 3, 2015.
- BroadbandSearch. “ Mobile Vs. Desktop Internet Usages.” https://www.broadbandsearch.net/blog/mobile-desktop-internet-usage-statistics#post-navigation-4. Visited 5 November 2020.
- Hosbein, Mark and Rob Davis. “Just-in-Time Marketing: Reach the Right Customer at the Right Time.” MarketingProfs. https://www.marketingprofs.com/articles/2017/31542/just-in-time-marketing-reach-the-right-customer-at-the-right-time. February 8, 2017.