Dec. 2019

Same tools, different outcomes. The quest for marketing alpha.


So many industries use data to make key decisions. Not everyone understands the data and sees insights clearly, and remember—sometimes the data presents no clear insight.

Portfolio managers think they know the formula best: when the right tools—namely, data, research, and processes—are properly honed, it is likely that results will exceed expectations. However, they rarely do. In the real world, 79% of active funds underperform, regardless of their managers’ education, experience, or past performance.* Unfortunately, the same holds true in marketing.

We have written about how managing equities is very similar to managing a successful ad or marketing campaign. I have done both. I can state that I was very successful as a portfolio manager. After all, the manifestation of our investment process is performance, and I have the data to prove my ranking. In marketing, we also point to performance data. We all have access to lots of data, tools for testing, and processes to ensure the right outcome. As the marketing industry scales, we all continue to find solid tools and are all accessing the same data. And as in the investment strategy realm, unfortunately, most marketers underperform, with only a few achieving marketing alpha and outperforming their benchmark.

For me, the best part of being a portfolio manager was performance measurement. How many of us are beating the index (ask: am I top quartile or top 5%)?  I was blessed with a great team. We preferred math to following CEOs spinning their stories. Prior to portfolio management, I had worked on countless IPOs and investor relations presentations, understood the math and how stories were crafted. Every manager has the same data and similar tools such as fundamental and tick data. We outperformed not by following the trends, but by developing our own processes—we tested, measured, refined, and optimized until we were ready to launch and scale our investment process.

Today, the team at E5A Integrated Marketing follows a similar path to outperformance. Once again, as marketers, we all have the same data and similar tools.

E5A outperforms because we don’t follow the herd—we develop our own processes. We systematically test, measure, refine and optimize to achieve superior results.

We craft repeatable, scalable processes that, with refinement, can adapt to various—but as we humbly know, far from all—scenarios.  Great marketers regularly (read: obsessively) analyze data to make optimal decisions. As in portfolio management, following thoughtful, out-of-the-box processes in a systematic, data-informed fashion leads to success.

E5A specializes in acquisition. Three-quarters of our work involves acquiring new investors for asset managers and wealth managers, as well as conducting Reg D and Reg A+ capital raises for companies or in real estate. The rest of our work involves a different kind of acquisition: rather than acquiring investors, we assist in acquiring new clients (B2B) or customers (B2C) at scale.

How do we achieve top-quartile performance? As expected, the numbers come first. As data-informed managers, we not only analyze trends—a hefty task, considering the unpredictable nature of certain markets—but must also present new, innovative strategies. What worked in one climate might be futile—even detrimental—in another. By continually evaluating the programmatic environment and other facets of the acquisition journey, marketers can (and must) avoid relying on recency and past experience so that they can allow the data, along with intellectual honesty, inform the path.

A winning marketing strategy begins with acknowledging the relationship between thoughtful, consistent messaging and incisive data analysis. It moves forward with a real understanding of your target audiences’ motivations and goals. When prospects resonate with personalized messaging, they feel moved, often choosing to purchase—or, at the very least, take the brand name with them, spreading the word. 

With regard to data, when marketers delve deeply into the audience they’re targeting and account for ever-evolving cultural trends, they tend to achieve results. We would rather narrow-cast to five audiences than craft a one-size-fits-all campaign for what might be a wide range of seemingly similar audiences. Blending these five audiences glosses over their nuances. Who are you seeking, and why? Eccentric tech investors may gravitate toward the modern and experimental, and might be more likely to invest in or purchase, say, eco-friendly office scooters. Older investors, by contrast, might eschew such things, instead focusing on passive income or new forms of current income. Or none of that may be true—but we can test, measure, refine, and optimize to uncover the best path. In the end, it’s all about behavioral patterns—do people on opposite coasts purchase or invest in different things? Does the ultra-wealthy suit our clients’ goals best, or is it better to target a wide range of middle-class individuals? We let the numbers be our guide.

As you may have already guessed, we’ve crafted a mantra of sorts—”test, measure, refine, and optimize”—that has served as a near-foolproof process for locating and acquiring desired prospects and making sales. By leveraging our multifactor model, we simultaneously optimize messaging, data, the journey, and media. Doing so has often resulted in achieving—and often exceeding—our clients’ expectations (and benchmarks). We are achieving marketing alpha.


*Source: CNBC. As of June 30, just 21% of large actively managed funds outperformed the S&P 500 in the last five years, according to SPIVA, the “S&P Indices Versus Active” data-gathering project run by S&P Dow Jones Indices. The rest — nearly 79% — could not beat the benchmark average.



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