Hear new perspectives in customer marketing from an experienced Customer Relationship Management executive.
Hello everyone. Shalom. I’m excited to be here really. So I work for Deezer. Deezer is probably the third largest streaming, music streaming service in the world. Our main competitors are Apple Music, Spotify, and we’re right there at number three.
Now, when I saw that piano here on stage, I was quite concerned because I was afraid that Optimove had got it all wrong and I was supposed to be playing some songs. And that’s not going to happen. So I was the happiest person in the room when Amit announced that Shlomi Shaban is performing tonight.
From an Experienced Customer Relation Management Executive
What I’m going to try and do today is give you a perspective of CRM, or a Customer Relation Management, from a perspective of an executive who has done it for many years, both through the music industry but gaming before. So I’ve been in gaming and I know there’s a lot of gaming executives here. I’ve worked for Bwin for six years. I’ve managed poker, casino, sports betting, social gaming, bingo. So I’m very familiar with your environment.
Ladies and gentlemen, someone is about to sneeze. When I usually say that two things happen, someone inevitably sneezes, but more importantly a lot of people are saying someone’s got the wrong presentation. But bear with me, I’m trying to make a point which I think is going to be very, very important for everyone in this room. When that sneeze comes out, it’s going to release 40,000 droplets of mucus and all that stuff you don’t want to hear about. It’s going to travel at the speed of 100 miles per hour. It’s going to actually reach 5 meters in radius and over 30 feet in distance. That’s not going to be a very pleasant sight. The main thing about that sneeze is that once you sneeze, you can’t see any of this happening, and that’s because your eyes are closed. Introducing digital sneezing and this is really the business that we’re all in here.
Home screen messaging can reach over one million people simultaneously, that’s dangerous. 2,000 push notifications can reach a phone instantly. Emails are sent at a rate of thousands per minute. In fact, this world spams people with 28 billion spam emails a day. We are certainly sneezing digitally and it’s not a very, very pretty sight. And when you are all pressing that send button because your boss told you to do another campaign, you can’t see nothing, because your eyes are closed. You only get the data the day after, when the data loads on Optimove and you come in the morning and you see what happens. So ladies and gentleman, you are all digital sneezers. So is CRM only about sneezing in crowded trains and making noise in a crowded place?
The Over-Communicated Generation
I’m going to make an attempt to answer this in this presentation, but first let’s have a look at our customers and what’s happening in our world. For the over-communicated generation, we have to take a look at two processes that are happening. Let’s start with the customers. This is what I call the Attention Deficit Disorder generation. When you look at what has happened through the years from the 1990s until today, we’ve seen a variety of things happening. We’ve seen smartphones being introduced, we have seen much faster networks: 3Gs and 4Gs. Then we’ve seen mobile operators stopping to charge for data, but bundling it in, which means much more attractive plans. And as a result, we’re seeing customers really interacting with data services. In fact, the average millennial today spends 47 daily minutes on email. They spend 114 minutes texting. The average millennial has 26 mobile applications on their phone which they are active every day.
Now, do you know which country leads the pack when it comes to active apps per device? It’s not the U.S. It’s not Europe either. It’s not Israel, no. It’s South Korea, guys, South Korea. They actually have 36 average apps on every mobile phone, only two of them though are paid apps. Whereas the world average is about 26 with about 6 apps being paid for. It’s just important for you to know who you’re trying to communicate with, these guys are busy.
Now, let’s take a look at you guys, you guys are busy as well. It started in the ’90s when you discovered database. All of a sudden, all the companies started employing data scientists to see their audience. And then we started segmenting the database to start to understand it, which was good. Then we started cooking our data and we started spying on our customers to see what they’re doing so that we can pinpoint what we need to do with them. Then we got much more sophisticated and we went into predicting how will they behave and looking at what they’re doing compared to other people in the same database.
So we’re becoming much more sophisticated as marketeers. And today we’re in the era of what we call microsegmentation. So it’s not enough to just have your database or just to be consumer centric. If you want to communicate with these guys, and these guys are very, very busy, you better start microsegmenting. But to do that, companies need to go through a total transformation. So it all starts with the way you design your products. And when I look at it, I would start with the user interface, the way you display your product, the way you display your lobbies. If you’re in gaming, if you’re in e-commerce, the way you display your shop. That has to be absolutely key for customer communications.
Next space is of course in-app tutorials. Don’t get them out of your environment, but actually teach them as they go along, show them features. And we’ve seen more and more happening in that area coming into smart inboxes and in-product notifications. You know all this, but when you come to think of it, most of your time is usually spent on the next promotion, and how are you going to press that button? Where in fact, my recommendation would be to spend most of your time in-product. Because that’s where you want your customers to be, that’s where you want the communication to take place, and good products deliver fewer messaging to customers and they appreciate it.
Research the Psychographics of your Audience
The next part is of course the research, and I’m sure everyone is doing research. But just to name a few, the psychographics of your audience, and you’ve got the data from the database. Learn much more about and venture out, do the focus groups, do the interviews, get to know, what’s this psychic? Why are they doing it? Why are they actually following you? Heat maps, you’re all familiar with heat maps, and of course the heat maps are part of the tools that you’re using to evaluate the efficiency of your website. But it goes way beyond heat maps. Today, we are actually toying around and playing with a new technology that actually records your emotions by looking at your eyes. So we’re actually showing customers our product, we’re tracking their eyes, and based on their eye movement and expression we can see if they’re feeling sad, or happy, or concerned, or afraid. There are companies out there already that provide that information, and I urge everyone to try and do it. Because that’s how you get to really know how your customers are responding to your websites and to your products. User observation, goes without saying, focus group, tracking the open rates and the response for it, and of course constant optimization. But you guys know all this, so let’s move on.
Every CRM Email is Part of your Brand
Then it comes to the execution, and gone are the days where you just send an email and you do a promotion. Today, every CRM email is part of a brand, part of a product. So design language, copy, that’s part of your CRM just as much as it’s part of your creative teams, above the line, or print campaigns. Which means more and more CRM managers are working closely now with the brand theme. Because many customers don’t even read your emails, but they might see the logo, they might see the font, and that will be enough to remind them of your product. Which means you have to make sure that your design language, your copy is actually adjusted to what you want to communicate as a brand.
Another interesting thing that I noticed happening in recent years is that we’re redefining the role of each channel, and what do I mean by that? Take email for example, email used to be, in the ’90s, probably the main channel we communicated with, just because this was the available technology. But more and more email is becoming a more official transactional communication channel. Which means you made a deposit, you bought an item, you get your receipt by email, and it’s becoming less and less used for promotions. So in the customer relationship with you guys, we’re starting to develop a language, which messages are sent by email versus push notifications versus SMS? And once you develop a methodology around it, you can actually train your customers to know what to expect when. So if you’re going to send them, if you’re in gaming, a deposit offer only by push messaging, they’ll know that when a push messaging comes, there’s going to be money there. If you’re going to do in-product promotions in order to show a new product feature and you’re going to be consistent with it, they already developed the notion of what’s coming next. So my advice here is make sure you define how you use these channels. Don’t just add them to your arsenal, and start developing a language with your customers. How do you actually want to communicate?
Shifting to Real-time Marketing
Of course, we are all going to need to shift to real time because our customers are working in real time. That creates a big challenge on data, right? Because we need to upload the data instantly, we need to respond very, very quickly. That creates a technological challenge, but the customers won’t wait. They’ve got 26 different apps working on their phones. So if you want to communicate in real time, it better be done instantly. Which means you’re going have to make adjustments to your systems, to the way your database works, and your IT team, and the entire infrastructure is going to have to make these adjustments in order to come up with the…keep up with the times. So very, very busy days ahead.
And finally, you will have to communicate outside of the product. There’s no way around it, because they’re not going to spend all the time on your product. Which means you might sometimes start communicating with your customers on the social network, and I know some of you are already doing CRM on Facebook. You get the emails of the customers, you push messages into their accounts. Which means CRM as we know it has changed completely from the ’90s, when we had an email and a million customers out there. And all these adjustments are currently taking place, and look at that slide, each one here, and ask yourself, “Where am I? Where is my company in this process? How advanced am I?”
The Need for Very Good CRM Tools
Fortunately, there is one thing which is the common denominator for all these changes, which is whatever you do, you’re going to have to have a very, very good data warehouse and some very, very good CRM tools. Because without having the data and the tools to support all this, you’re not going to be able to execute.
And I think this is where Optimove and the guys sitting over there come into play. They’re the ones who are bringing you and giving you the ability to execute that change in your organization, which I urge you to start sooner rather than later. So this is the time where we actually have to answer the question, so should we just sneeze on crowed trains, or can we actually do something much more effective?
So when I speak to my team about CRM, I tell them, “Don’t be sneezers. Don’t sneeze in crowed trains.” Just remember that vision, the first slide I showed you of the lady sneezing in a crowed train. Try to look for those sneezers, try to look for people who’ve just sneezed and they need something valuable at this moment in time, in this case a tissue. So when you sit down, when you work on your campaign, ask yourself, “Am I actually delivering to the user what they need right here, right now?” Don’t be the sneezer, find the sneezers, and hand them a tissue. That was a quick intro into CRM in general and the challenges that we’re all dealing with. But at the end of the day you have the tools, you have the methodology, you have the know-how.
Communicating with Customers in Context
The next element, which for me is absolutely critical, is context. I think one of the things we sometimes miss is, what is the context that we are currently communicating with our customers in? What is it? What’s going on? What’s in the customer’s mind? You’ve got the data, you’ve done the research, you have the product. Really, really key to understand, this email that I’m sending, that push notification, where do I get the customer? What do I want them to think? And how do I wish for them to react at that point in time?
So I want to give you a few examples from your world, and please don’t take this as the gospel. I know some of you are CRM experts here, what I want to do is I want to make a point. Just to get you into the state of mind of context thinking, rather than what’s right or wrong promotions for each of the verticals.
So poker, anyone in the room who manages poker? One guy? So only one guy is going to understand me right now. So the dynamic of a poker operator or a poker player is very, very simple. The poker provides an arena, an arena for the gamers who come in and play against each other. The poker room makes money, not from the players, but from the rake, for what we call the fee that we are collecting when two, or three, or multiple players play each other. The psyche of a poker player is very, very simple, they want to make money. And the way they make money is that they need to play with players that are not as good as they are. It’s as simple as that, and they call it their bankroll. And they also have a terminology for it. If you’re a good player, you’re called the shark, and if you’re not a good player, you’re called the fish. And guess what? The shark, they eat the fish. Get it? So that’s the context of poker.
Using the Right Messaging
Now, you can do a CRM for a poker player promotion and say, “Hey, we have a new tournament.” How many times have gaming sites sent out an email saying, “Hey, we have a new tournament?” I did many, many times. What you really want to tell that poker player, he or she knows you already have tournaments, you want to tell that poker player two things, “Thousands of new players at our new tournament tables.” Now, what does that mean for the poker players? There’s two things that come into the poker player’s mind. When we have thousands of players in a tournament, it means that the prize pool in the tournament goes up, because the more participants, the higher the prize pool. So the first thing you’re actually telling your poker player in their own language is, “Guess what, the guarantee jackpot of the tournament has gone up.” What you’re also telling them, and being very politically correct here, you’re telling them that these are new players, which means you probably did a big campaign, maybe on TV campaign. That for poker players that means, there are many, many new fish in the pond. Which means there’s a higher guarantee, and there’s much more fish in the pond, I’m coming to play on your site. Now, this is important, because that’s how you write a copy for the poker players, because that’s the terminology they use. You’re nodding, that’s good.
You Need to Understand your Customers’ Psyche
Same goes for sports betting, same goes for bingo. At every vertical that I’ve managed in the gaming industry, I’ve made an effort to really start and understand what’s the psyche? What’s happening when the player is actually interacting with us?
There are a few examples on the slide behind me, but maybe actually I’ll choose bingo, because bingo is probably not the most popular of the gaming products. But it’s quite an interesting observation to actually understand the psyche of the players when they’re actually playing.
When we’ve done some observation research, we call it the TTF Effect. Because we discovered that most of our customers were females above 35, and they were sitting at home on the armchair, and they had their tea over here because most of them are English. So they had the cup of tea over here, they had the television right there. And you know what they had in this side? A fag. A fag, smoke for cigarettes in proper English. TTF, and the reason they had a cigarette is because bingo halls in the UK stopped allowing smoking in public places. So, the bingo ladies went home, sat down on their armchair and they had a tea, a telly, and a fag. And then we understood the dynamic, we understand that what we need to do is wait for the tablets to come in Christmas, because isn’t it ideal to sit down and have a tablet while you have your tea, and your telly, and your fag? And once tablets came out to the bingo market, we’ve seen the numbers skyrocket. In fact, we started giving our customers tablets, because we knew this is what they’re looking for.
So the context is much more important than the tools. It’s much more important than your methodology. It’s really understanding who you’re dealing with. Let’s talk about psychographics again in the instance of bingo because I’ve actually had the pleasure of managing one of the more from…anyone from England here by the way? Okay, you guys know FoxyBingo? Good. So I had the chance to manage FoxyBingo, and one of the things that we’ve done when we started working with Foxy is trying to understand the psyche. Why would a fox, or a man dressed up in a fox suit, be appealing to ladies? And what we discovered was that at 10:00 at night, when the husband is falling asleep on the sofa, and she’s got no one to talk to, she wants an escape. She wants a lover, but it’s not really, really good to go and find a lover when you’re married with three kids and a mortgage. But falling in love with a fox, which is very, very charming, and cool, and looks good, and dressed up in a suit, appealed to a lot of these ladies, because it was a safe escape. It wasn’t something that would threaten their relationship, and we played a lot on that psychology.
You go to play at FoxyBingo, you find your friend, he’s cool, he’s mixing with celebrities, and of course you start creating a relationship which is safe. So context is absolutely key. Before you press the send button, there’s a lot to be done.
The Interesting Casino-Player Dynamic
One more example from the gaming world, I’m assuming a lot of casino managers are here. Casinos? No one manages casino? Okay one, one brave guy. Okay, so casino again, it’s all about…it’s a very, very interesting dynamic, the casino and the customer, right? We have this, “I want to win the house money, the house wants to win my money.” And we’re supposed to create a loyalty relationship between us, how is that going to work?
But that’s exactly the nature of a casino customer. They want my money, I want their money, and of course they’re still loyal customers, they are still VIPs. How does that work? And I think a lot of it again goes to context. We all know that the customer wants to win, and they want out when they’re on the upside. You can, of course, send an e-mail to say there’s 100% bonus if you deposit today, most casinos do it anyway. But is it really valuable in the long-term? Does it really provide a long lasting loyalty and a relationship with the customer? I would say probably not, although, it is effective, I would agree.
On the other hand, if you realize that that customer…and I think Shaha spoke about it yesterday, some customers provide and develop an affinity to a certain slot machine. And they play on it, and they play on it, and they want it to explode, they want to win that jackpot. And if you send one email that says, “You know, that jackpot hasn’t paid off in about two weeks now, it’s about to explode.” What you’re doing really is you’re enticing the customer but you’re also giving them a context to it. We’re tracking the jackpot, we know what you’re looking for. It may come, it may be now. And, of course, that is a much more appealing promotion. There’s a big number there, there’s a rationale, and of course there’s a call to action to come and play. Of course, you can always put the bonus, if you want, on top of it. So at the end of the day, from my point of view, whatever you’re doing in gaming, whatever you’re do in any other industry, comes down to having the right methodology, having the right tools, but most importantly having the right context.
An Overview of the Streaming Music Industry
So now it’s time for me to take off the gaming hat and talk to you a little bit about the music industry and music streaming. So what is a streaming service? And unfortunately, most of the people, the Israelis here, haven’t really experienced a streaming service up until recently because they weren’t around. Apple Music just launched a month ago and the rest are not there. Even Deezer, although, it is available in 180 markets, it’s not in Israel yet, so something to look forward to.
But what’s our role as a music streamer? We’re not the artist. We can’t be the artist, we can’t replace the artist. Neither can we replace someone’s taste, or dictate to them what they like. The role of a music streaming service is to basically be a facilitator. It’s a facilitator to help you, as a customer, find the music that you like, make it accessible to you, make it available on all devices and storable. But also provide you added value by starting to recommend to you music that we think you will like. Because one of the biggest motivations for using a streaming service is to have what you want, but also to discover new music. And that’s really, really important to the dynamic of a customer. And the way we do it, we’ve developed a feature which I’ll talk about later.
One product feature, which we call Flow, and the reason we call it Flow, just as it sounds, it flows your music and it learns the way you consume music. It learns what you like, it learns what you dislike. It learns, when do you listen to music, what’s your genre, what’s your habit? And our attempt is to give you a one click experience where when you press play, you press Flow and we get you. But before we talk about Flow in particular, I want to talk to you about the challenges of a music streaming service.
Challenges of a Freemium Service
To begin with, we are a freemium service, and those of you who are in social games probably know it very, very well. In the freemium business, you’ve got millions of users who are paying you nothing. And what you’re trying to do is to convert a small percentage of the users to actually buy a premium package. So to do that, you have to actually deliver greater value in the premium than what you have in the freemium. However, our free service needs to be much better than average because customers have an alternative. They can go to YouTube, they can go to an illegal download music site. So we have to provide a superb free experience, and then an even better premium experience.
The other challenges we have is that unlike the gamers, all customers in our world are equal. You have your VIPs, you know how much they deposit. They can deposit $1, $10 or $100,000. In the music business, in the music streaming business, a loyal customer pays you $9.99 per month whether they stream 1 song or 10,000 songs a month. Which means all customers are equal, which means it’s very, very hard to deliver additional value even from your most loyal customers. And at the end of the day, just like in every other industry, usage drives conversion. So we need to get customers to listen to music, to choose our application over the applications, the other applications, and the other entertainment features they have on their phone. So what’s the context? I mean, how do we view our customers and what do they need from us?
First thing is first, when a customer comes to a music streaming app, the first thing they do is they search for an artist or a song that they know. So if someone sang it, we better have it. That’s why we have a catalog of over 40 million songs and growing. Because we want to make sure that when you come into the app, you do your search, you find the song you like. If you don’t find a song you like twice, the chances of you leaving the app is over 80%. We want to curate music and serve it to you in the most appealing way. People want to get new music, music that comes from editors, from experts. They want people to serve it to them in a very, very good and easy way to access, and that again is part of what we do.
They want to organize their music life. Remember all those CDs that you used to have, like 50, 100? Gone. Remember the downloads you guys have on your phone? Gone. We don’t do it anymore. You use the streaming service, you’ve got 40 million tracks. They’re all on your device. You can access them as long as you’re connected to Wi-Fi. And, of course, at the end of the day, after you’ve played around with the app, you’ve seen all we have to offer, you want a very, very easy experience, click and play, the lean back experience.
The Fear of Missing Out
The other thing we’re looking at is the motivation factor. What’s the motivation factor of a customer coming to a streaming service? It’s probably quite similar to what you guys are experiencing, whether it’s e-commerce or gaming. The first one is we call FOMO or Fear Of Missing Out. The new generation of customers, they don’t want to miss out anything. If a new song is out, they want to know about it first. If a singer died, they want to know about it first. They don’t want to hear it on the news, they want to hear it from their music app. So the fear of missing out is absolutely critical, because we can’t be in a situation where one of our customers heard something to do with music not from us. That’s when we lose credibility, which means we need to be on the ball all the time of what’s going on in music. They should be the ones telling their friends and not vice versa.
Leveraging People’s Fear of Being Offline
The other thing that we’re seeing as we’ve gotten more and more Wi-Fi everywhere you go in the world is FOBO, which is pretty much Fear Of Being Offline. People hate being offline. I’ve been to a museum in Amsterdam and I heard a few Israelis, I should say, coming in and saying, “What’s the Wi-Fi in the museum?” I’m like, “You’re here to see art, why do you do need a Wi-Fi?”
But people just don’t want to miss out. People don’t want to be disconnected, which means your customers want you to be connected. And when you’re not connected, you better have a very good download experience that they can take with them. Which is why a lot of streaming services are providing downloadable music as well that people can take on the road. In fact, what we’re going to do, we’re going to measure how long is your commute when you’re in the train and maybe you don’t have Wi-Fi? And we’re going to send you a playlist for the same length of time you’re going to be disconnected that you can download before you leave the office. So that we never get in a situation where you press play and nothing comes out, that’s FOBO for you.
So it affects the way we plan our product, it affects the way we do our CRM, Fear of Being Offline. So how do you take all this into one product feature, to one thing that’s a winner, to one thing that actually makes people say, “Wow, I love it.” It’s very, very hard. That’s the short answer.
But what we’re trying to do with Deezer is we’ve taken playlists and we’ve taken channels, and we’ve taken all the categories, and we’ve taken your moods, and we’ve taken your pace. So if you’re running, we want to know that you’re running because your phone moves. And if you’ve landed in Tel Aviv, we want to make sure that we can serve you some songs that are maybe Tel Aviv oriented, if there is anything like it, I’m sure there is. By the way, we have a playlist which is Tel Aviv Playlist, believe it or not.
So we call it Flow and it’s one feature at the top of our app, and when you press Flow, the more we know about you, the better your Flow is. That means we need to provide you with a superb music experience depending on what you do. So if I have a meeting in Tel Aviv with a lady called Donna, then my Flow should know that I’m in Tel Aviv and perhaps have a few songs with the word Tel Aviv in it. Maybe a song or two with the song “Donna.” And if I’m running to the meeting because I’m late, then the tempo of my music should actually become faster because my phone is moving.
This is the position we’re trying to go with getting to know our customers, and that goes beyond the CRM, and the email, and the push-messaging, it all starts with the product. We’re also adding features where you can tell us, “You’ve got me all wrong Flow. I’m not actually running now, and no, I’m not in a romantic mood at all.” Which is why, you probably can’t see it from afar, but we’re developing icons where you can actually outright us. You can actually overwrite Flow and say, “Not happy, send.” And then we would have to reboot. So we’re creating a language of the customer where we try to guess you, we understand you, we serve to you the music that you like and the music that we know that you will like. But we also give you the opportunity to come back to us, and say, “You got it all wrong chaps, give me something else.” We’re also adding features where we’re allowing the customer to decide, how much discovery versus familiar do you want? Some customers love to discover new songs, others just want the good old familiar. So we’re going to give you this dial where you can decide, “Do you want to be adventurous or do you want to be conservative?”
The outcome of all this is that you’re actually creating a relationship which goes beyond product, beyond email, beyond push-messaging. Your Flow becomes your very, very own and personal Flow. Which means if anyone takes my application and starts messing around and listening to their music, I get really pissed off because my Flow then changes. And so you create a relationship with the product, you create dependability between the product and the customer.
Effective Communication with Customers
So if I had to summarize what we’re trying to do as marketers, and how we are trying to actually communicate with our customers in the era of much more channels and very, very busy customers, I would probably say the following. That effective digital companies use the most sophisticated tools, which you all have, available to them to identify…remember the sneezers? The sneezers in real time, or better still before they sneeze. I mean you want to know what customer is going to need something really soon. And once you know that, we start delivering, one tissue at a time. Bless you. Thank you.