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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
Big data. Digital loyalty programs. Predictive analytics. Contextualized content. Are you ready? These are just a few of the newest trends in digital marketing that are part of our everyday world. In The Digital Marketer: Ten New Skills You Must Learn to Stay Relevant and Customer-Centric, digital marketing guru Larry Weber and business writer and consultant Lisa Leslie Henderson explain the latest digital tools and trends used in today's marketing initiatives. The Digital Marketer explains: * The ins and outs of this brave new world of digital marketing * The specific techniques needed to achieve high customer engagement * The modern innovations that help you outperform the competition * The best targeting and positioning practices for today's digital era * How customer insights derived from big and small data and analytics, combined with software, design, and creativity can create the customer experience differential With the authors' decades of combined experience filling its pages, The Digital Marketer gives every marketer the tools they need to reinvent their marketing function and business practices. It helps businesses learn to adapt to a customer-centric era and teaches specific techniques for engaging customers effectively through technology. The book is an essential read for businesses of all sizes wanting to learn how to engage with customers in meaningful, profitable, and mutually beneficial ways.
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Seitenzahl: 532
Veröffentlichungsjahr: 2014
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Table of Contents
Cover
Title Page
Copyright
Dedication
Acknowledgments
Foreword
Introduction
Chapter 1: The 10 Essential Skills Every Marketer Needs
Digital Has Changed the Game
We Have All Benefitted from the Disruption
Just Ahead: Relief and Reward
What Do We Mean by Customer-Centricity?
Get Customer Experience Savvy—It Pays
What Do Our Customers Want from Us?
How Remarkable Do We Need to Be?
Will We Ignore Change, Grow with It, or Drive It?
What's Next?
Notes
Chapter 2: How Organizations Are Adapting to the Customer-Centric Era
The CCEO: Shifting Our COMPANY'S Point of View
The CDO: Expanding Our Organization's Way of Thinking
The New CIO: Developing New Sources of Insight
What's a Marketer to Do?
Notes
Chapter 3: Build a Successful Marketing Career (Hint: Standing Still Is Extraordinarily Risky)
Me.com
Expect a Unique Career Trajectory
Know Thyself
Brand or Be Branded
Be Resourceful
Cultivating Developmental Relationships
Empowered and Vulnerable
Notes
Chapter 4: Design Valuable Customer Experiences
Frameworks for Thinking about Customer Experience
Generating Remarkable Experiences with Design Thinking
The Science of Behavior
Getting Our Arms around Our Customers' Experience
Notes
Chapter 5: Find Actionable Insight in Big Data and Marketing Analytics
The New Face of Market Insight
What Exactly Is Big Data?
Where Is the Insight?
Where Does Big Data End and Small Data Begin?
What Are Marketers Doing with Data and Analytics?
How Analytics Savvy Do Marketers Need to Be?
Tackling an Analytics Project
Develop a Marketing Data Analytics Capability
Big Data Means Big Responsibility
Notes
Chapter 6: Employ Entrepreneurial Thinking for Discernment and Agility
We Are All Innovators
Sprint. Evaluate. Repeat.
Stay Relevant
Rethink Failure
Notes
Chapter 7: Create a Content Experience Strategy That Delivers
Who Signs Our Paycheck?
Content Marketing Focuses on Our Customers' Agenda
Content Marketing Works Throughout the Journey
Where Is the Content Engine Heading?
Commit to Relevance
Develop a Content Experience Strategy
Tips for Creating Relevant Content
Who Is Going to Create All This Content?
Notes
Chapter 8: Engage Customers via Social Communities
Community Matters
Social Media Has Taken the World by Storm
What Have We Learned?
What Are Marketers Doing with Social Media?
Fish Where the Fish Are
Are Our Social Media Efforts Working?
Notes
Chapter 9: Maximize Marketing Impact with Converged Media
Pursue a Converged-Media Strategy
A Closer Look at Paid, Earned, and Owned Media
Owned Media Is Everything We Create
Converged Media Mixes It Up
Paid Media Supports Owned Media
Native Advertising Is Converged Media
Does Native Advertising Deliver?
The New Kid on the Block: Mobile Advertising
Programmed Advertising Is Making Its Mark
Second Screening Enhances Brand Touches
What About Print?
Digital Signage Captures People's Attention
Events Are Immersive Customer Experiences
Working with Agencies in a Converged World
Notes
Chapter 10: Drive Sales with Marketing Automation
Wanted: An Intelligent and Integrated Customer-Engagement Platform
What Is Marketing Automation?
What's Inside the Black Box?
Create a Centralized Marketing Database
Maximize Revenue Performance
Prove the Value of Marketing
Marketing Automation Supports—but Does Not Replace—Marketers
Notes
Chapter 11: Craft Worthwhile Loyalty and Digital Couponing Programs
Loyalty Programs Are Ubiquitous
Is Loyalty on the Decline?
Do Loyalty Programs Promote Loyalty?
Benefits Beyond Loyalty
Strategies for Designing Loyalty Programs
Measuring Loyalty
What about Digital Couponing?
Notes
Chapter 12: Ignite Customer-Centricity Everywhere
Customer-Centricity Is a Systems-Level Opportunity
A Shared Vision for Customer-Centricity
Fostering a Pro-Learning Environment
Where Do We Begin?
The Customer Is at the Center
Notes
Index
End User License Agreement
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Guide
Table of Contents
Introduction
List of Illustrations
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Figure 10.1
The Digital Marketer
Ten New Skills You Must Learn to Stay Relevant and Customer-Centric
Larry Weber
Lisa Leslie Henderson
Cover image: ©iStockphoto / Atropat
Cover design: Wiley
Copyright © 2014 by Larry Weber. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750–8400, fax (978) 646–8600, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748–6011, fax (201) 748–6008, or online at www.wiley.com/go/permissions.
Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor the author shall be liable for damages arising herefrom.
For general information about our other products and services, please contact our Customer Care Department within the United States at (800) 762–2974, outside the United States at (317) 572–3993 or fax (317) 572–4002.
Wiley publishes in a variety of print and electronic formats and by print-on-demand. Some material included with standard print versions of this book may not be included in e-books or in print-on-demand. If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com. For more information about Wiley products, visit www.wiley.com.
ISBN 978-1-118-76083-3 (cloth); ISBN 978-1-118-76097-0 (ebk);
ISBN 978-1-118-76081-9 (ebk)
To our respective families, for their unwavering support and enthusiasm.
—LW and LJLH
Acknowledgments
Writing a book evokes profound appreciation. Like jazz musicians that improvise on established compositions to create new melodies, we are grateful to the many who took the time to share their thoughts and experiences with us, further developing our initial observations into themes, and ultimately chapters. If there is music among these pages, it is due to their generosity.
Multiple business leaders, academics, and specialists contributed to the building of The Digital Marketer's melody and supportive harmonies. Mark Fuller (Rosc Global), Len Schlesinger (Harvard Business School), Sally Ourieff (Translational Consulting), Saul Kaplan (Business Innovation Factory), Rick Kash (Nielsen), Scott Epskamp (Leapfrog Online), Diane Hessan (Communispace), Scott Russell (Sparks Grove), Robin Frank (beep beep media), Dan Fukushima (Sparks Grove), Scott Neslin (Tuck School of Business), Peter Henderson (ShapeUp), Elizabeth Zaldastini Napier (Tuck School of Business), Josh McCall (Jack Morton Worldwide), Rodrigo Martinez (IDEO), B J Fogg (Stanford University), Becky Bermont (Creative Leadership), Alan Trefler (Pegasystems), Torrence Boone (Google), Debi Kleiman (MITX), Joi Ito (MIT Media Lab), J P Maheu (Bluefin Labs/Twitter), Wendy Murphy (Babson College), John Maeda (Rhode Island School of Design), Sanjay Dholakia (Marketo), R. Michael Hendrix (IDEO), Scott Ludwig (Skyword), Brian Babineau (Arnold Worldwide), and George Colony (Forrester Research) have all quite generously shared their time and insight.
We are, as always, indebted to Jill Kneerim, Larry's literary agent who heard the melody in this book, and for Richard Narramore, our editor at John Wiley & Sons, who enthusiastically agreed to publish it. Where would we be without Tiffany Colón, our editorial assistant at Wiley, who, like a metronome, kept us on task and on time, and Lauren Freestone, our production editor, who pulled multiple parts and myriad notes together into one score.
Producing a book takes a tremendous amount of planning and coordination. Heartfelt thanks to Nancy Provost, Larry's trusted executive assistant, and Ginger Ludwig for their orchestration of details, despite their already full agendas, and to Kevin Green at Racepoint Global for his keen insight and creativity that consistently breaks new ground.
Finally, a standing ovation to our respective families. We are always grateful for your accompaniment.
Foreword
PR professionals in the technology world are typically gentle, political animals, subtly and quietly steering their clients' offerings into the most flattering light. Then there is Larry Weber. I distinctly remember our first interaction when he brought a client to the old Forrester offices in Harvard Square. No subtlety. No calm nudging. No backroom whispering. It was an all-out, high-volume, lean-in, Fight Club, Oxford debate—with Larry passionately advocating for his client and deftly challenging the best arguments of the assembled know-it-all Forrester analysts. It was the first time that I had seen someone from the vendor PR world construct complex and compelling ideas about the future and how markets would transform. This guy was clearly an original thinker.
All of Larry's idea-centric passion and sense of the future shoot out of this volume—The Digital Marketer. It's a book with impeccable timing. Why?
Because we are entering what Forrester calls the age of the customer—a 20-year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers. Customers will take power from institutions (especially companies) through their access to precise pricing, social voice, and ability to buy anything, from anywhere, from anyone, at any time.
The only way for companies to create a sustainable advantage in the future will be by constructing superior experiences that can win, retain, and serve the newly demanding customer.
And much of that experience will rest on digital. In the future, all companies will be software companies.
To stay relevant in the age of the customer, marketing leaders must be able to adapt to—and exploit—the four market imperatives that are driving the rise of the empowered customer. They must be able to:
Transform customer experiences
. Companies must make substantive investments in customer experience to build relationships and amplify fans. In short, companies must transform to become customer-
obsessed
enterprises. Customer obsession focuses strategy, energy, and budget on processes that enhance knowledge of and engagement with customers—and prioritizes them over maintaining traditional (and crumbling) competitive barriers. Marketing leaders must lead the customer-obsessed journey up, down, and across the company.
Become digital disruptors
. Digital has unleashed intense and rapid waves of innovation. Disruption requires agility that marketing isn't typically known for, with shorter development cycles and fewer organizational silos. Disruptors spread digital skills and a digital mind-set across strategy and operations, not just marketing or technology. To stand out, you must break your old patterns of doing business to make your customer's life easier. This won't be easy—patterns of work and behavior are difficult to break.
Embrace the mobile mind shift
. Mobility has trained people to expect any information or service to be available to them at their moment of need. Context—knowing real-time customer situations, attitudes, preferences, and desires—is key, as is being able to respond to those customer desires at high speed. Few digital strategists have a grasp of just-in-time service, but that's where the mobile battle will be fought.
Turn big data into business insights
. Developing true customer insight requires a significant overhaul of your analytics. Marketers need insight across the entire customer life cycle to help grow existing relationships and predict future behavior. Big customer data will be the gasoline that powers all future marketing campaigns.
The age of the customer is demanding a transformation of thought—and herein lays the problem: Only a small minority of marketing executives have any inkling of how they will have to organize and think and perform in the new age. While marketing will take on a new level of importance (one could argue paramount importance), the great majority of marketers are unprepared for the challenge.
Luckily for us and for them, Larry and his coauthor, Lisa Leslie Henderson, have arrived at just the right time with just the right book. The Digital Marketer will serve to direct this generation of executives on the task of retooling. From his 10 essential skills to his specific directions for how to build customer experience to his clear explanation of complex technologies like big data, Larry and Lisa present marketers with a manual for survival and success. And The Digital Marketer's intriguing examples, references to other experts, and guidance on where to find additional resources extend this book's value beyond its pages.
Forrester has invested much time and energy in researching this tectonic shift in the business environment. We firmly believe in the potential of the age of the customer—or Customer-Centric Era—to reshape how both marketers and technologists define their jobs and the legacies they will leave.
For our clients and the world at large, I am very glad that Larry and Lisa have endeavored to shape and teach the next generation of marketers—a group that will face a series of challenges that did not apply just a few short years ago. No other profession is living through more change, but no other work is more exciting, vibrant, and important than that of the digital marketer.
And now that new generation of marketer has teachers.
—George F. ColonyChairman and CEOForrester Research, Inc.www.forrester.com
Introduction
Almost 35 years ago I began a career in marketing with one blue suit, a typewriter, and some Wite-Out. No mobile phones, computers, social networks, big data, and so on. The landscape has changed radically! We have moved from a media-centric universe to one of customer control.
If this transformation was a new solar system, the customers would be the sun orbited by dozens of planets: Customer Experience, Content, Converged Media, Loyalty, Marketing Automation, Mobility, and so on. The Digital Marketer is here to serve as a master guide to this new universe.
Nothing is more important than the customer relationship, so marketing has become the new operating environment of commerce.
I want to thank my family, colleagues, clients, and especially my coauthor, Lisa Leslie Henderson, for their tremendous support.
Enjoy the ride around the stars!
—Larry WeberBoston, Massachusetts 2014
Chapter 1The 10 Essential Skills Every Marketer Needs
“In the face of change we have three options: ignore it, grow with it, or drive it.”
1
—Gerard Puccio, Marie Mance, Laura Barbero Switalski, Paul Reali, Creativity Rising
No one needs to tell us that the world of marketing is changing fast. We are living it. Low-cost and ubiquitous communications technology is irrevocably altering human behavior, causing seismic shifts in marketing philosophy, practices, and careers. At its core, marketing is still about creating and keeping customers, but the how-to questions for accomplishing this have changed considerably.
The Web has empowered people everywhere. Whether in New York or Nairobi, today's customers are connected, informed, and more vocal than they have been in the past. Anyone with a connected device—39 percent of the world as of 20132—now has access to all of the world's knowledge and many of its citizens. With these resources at their fingertips, our prospects and customers can discover and investigate anything and everything, establish decision-making criteria, seek opinions from their peers, evaluate their options, and share their impressions and experience with others, anytime and anywhere. As a result, the relationship between businesses and their customers has been dramatically altered: our customers are now firmly in charge of the buying process.
Digital Has Changed the Game
In the predigital landscape, our prospects undertook a straightforward purchase journey that we likened to a funnel. The process began with a need or desire that our prospects chose to address. Salespeople were involved early on, helping to establish decision-making criteria. Our job as marketers was to build awareness and create materials that made the case for why our solutions should be adopted. Many consumer brands had loyalty programs to encourage retention, but not much attention was devoted to post-purchase engagement.
Digital has dealt us all new cards. Today's customer journey still starts with a need or a desire, but our prospects often undertake an at times lengthy period of silent due diligence during which time they discover and evaluate their options via the web. During this period of discovery our prospects' consideration set often grows rather than narrows. According to Google's Zero Moment of Truth study, the average person pulls information from 10.4 sources before making a purchase.3 Some of the most influential sources are other people's unfiltered post-purchase commentary. Salespeople enter the process at a much later stage for business-to-business purchases; most e-commerce purchases can be made independently.
Marketers have become essential to the purchase process, as more often than not, content is the tool that breaks through this silent due diligence, initiating a conversation between us and our prospects. Recognizing this shift, marketers have become content publishers, experts at creating useful resources that address our prospects' and customers' underlying needs and desires. If these experiences resonate, we may be invited into the purchase process. Serving as trusted advisors, rather than biased advocates for our company's products and services, we create the conditions for our prospects and customers to evaluate for themselves whether we make the grade.
Social media has multiplied the potential points of connection with our prospects and customers and its interactive nature has turned static text into cross-channel dialogue. As we blog, tweet, host webinars, publish white papers, produce videos, and curate Pinterest boards, we generate living assets that can draw prospects to us. As we come to know these people as individuals through careful observation of their digital body language, our encounters become more personalized, incorporating predictive analytics to enhance their usefulness.
Figure 1.1Visual of the Customer Experience Journey
Post-purchase engagement with our customers has become essential. Our customers are a primary source of word of mouth—peer-to-peer recommendations—that can make or break future sales. In these later-stage interactions we can learn the details of their experience with us, answer any remaining questions they may have, and mitigate any outstanding negatives. If done right, these can foster positive advocates for our products and services, harness wisdom for our customer service efforts, and generate additional business. Our customers are also a vital source of insight into demand. They may not tell us outright what they want, but they can tell us about their needs and desires. With that knowledge, we can explore latent and emerging demand and co-create new products, services, and experiences that will provide tomorrow's revenue.
Although our prospects may not begin today's customer journey looking to develop an ongoing relationship with us, or with any company for that matter, as we engage in ways that are useful, they often morph from being unknown prospects, to becoming customers, and in many cases, to join with us as partners. As we transform a traditionally passive and transaction-oriented association into a collaborative relationship where we co-create, co-market, and co-serve our brands, our role as marketers expands. We are becoming key drivers of sales, loyalty, and innovation, producers of revenue rather than primarily generators of expenses.
The Disruption of Marketing Continues
Digital's impact on marketing is not yet complete. Innovative technologies and heightened customer expectations are unleashing creativity, spurring imaginative forms of brand expression and interaction. Sensors and near-field communication devices are changing the very nature of products and services, prompting us to reconsider how our companies' value propositions may change when every object—from our customers' homes to their bodies—are connected to the Internet. As the bar is raised, marketers are becoming experience architects, collaborating closely with designers and software engineers.
Widespread adoption of mobile technology has brought new opportunities. The qualities that make mobile a highly engaging, lean-forward medium—touch screens, voice recognition, cameras, and GPS technology—are enabling rich, contextualized experiences. Mobile “always with you” quality has also issued us a new challenge: How to unobtrusively accompany our customers through the course of their days, offering valuable experiences that enhance their lives.
New channels continue to proliferate and are being adopted at record speeds, keeping us on our toes as we evaluate their relevance to our constituents and their effectiveness in obtaining our business goals. Every channel is becoming increasingly visual, forcing us to express our ideas in alternative, visually stimulating ways.
Today's customers live their lives across channels, often incorporating several to complete a single task or transaction. To effectively meet their needs, our companies must be present and available in their preferred channels, offering a seamless, personalized, and often predictive experience. Our ability to offer these contextualized interactions at scale requires that we become adept at big data collection, predictive analytics, and marketing automation, competencies that involve new technology, advanced organizational learning, and high levels of coordination across functions.
New enterprise marketing management systems are emerging to facilitate these personalized interactions, augmenting existing back-office oriented enterprise resource planning (ERP) systems that focus on accounting, manufacturing, supply chain management, and human resources. These new systems are designed to foster information flows and collaboration across business functions and our entire demand-related ecosystem in order to more effectively serve our customers.
Native advertising, which when done well mimics organic content, is presenting new targeting opportunities, causing a lot of buzz and a shift in media purchases. Fueled by immense amounts of data on our prospects and customers that is collected, integrated, and analyzed on a moment-to-moment basis, this new form of advertising is prompting marketers to develop converged marketing strategies, blurring the lines between paid, earned, and owned media.
E-commerce has lowered the barriers to entry for competition, establishing a truly global marketplace. Worldwide information flows are turning marketers, possibly inadvertently, into managers of global brands and customer communities. Viable disruptors to established industries can popup anywhere—especially in emerging markets.
Building loyalty in an age when people are inundated with options from near and far and can comparison-shop with ease is a demanding task. As marketers we must continually find ways to stay on top of shifting customer preferences and distinguish our products and services from the growing competition.
Rapid marketplace changes demand that we become more flexible and responsive, challenging rigid corporate cultures and processes. Adopting a more iterative and experimental approach enhances our agility; however, it also requires that we foster a pro-learning environment that values what we glean from our successes and from our failures.
Finally, the pressure on marketers to prove the value of our efforts is tremendous. On one hand, it has never been easier to see the impact of our efforts as digital interactions leave behind a trail of behavioral data. At the same time, it is not easy to piece together this data as it is not captured in a sequential stream from first encounter to sale or advocacy. Closed-loop analytics are making it possible to track the effectiveness of each of our marketing initiatives, but they require software investment and technological know-how.
We Have All Benefitted from the Disruption
As challenging as it is to be a marketer during one of the most rapidly changing business environments in history, both our customers and our businesses have benefitted from the disruption. The numerous changes that digital has ushered in have forced us to move away from our traditional producer-based strategies and tactics, to focus on meeting our customers' needs and desires.
Customer-centricity is an old story. For decades we have known that being as close as possible to our customers and bringing their voice into the center of our organizations has been a winning strategy, but we have not turned that aspiration into reality. The rebalancing of the relationship between companies and their customers has forced the issue, however.
Organizations that have grasped the new reality and are redesigning the way they engage with their prospects and customers are making strides in realizing customer-centricity. They are distinguishing themselves by setting new standards for a customer's experience and often exceeding them. A look at Amazon and Marketo illustrates just how far we have come.
Your Amazon.com
Amazon's customers feel as if the world was made for them. When they arrive on any of the company's sites, they are greeted by name. A robust search engine acts like a personal assistant, quickly locating items from multiple vendors. Tailored recommendations that reflect their prior searches, page views, reviews, and purchases offer suggestions for additional items that may be of interest, presenting relevant options of which they may not otherwise have been aware (see Figure 1.2). To make itself even more useful, Amazon offers its customers the opportunity to proactively rate additional items and express their preferences, enhancing its search engine's predictive ability.
Figure 1.2 Amazon Prompts Purchases with Customized Recommendations
Ancillary features transform a simple purchase into an experience on Amazon. When looking for a book, customers may enjoy videos about the author, the opportunity to “look inside” the book's cover to preview its contents, and the chance to read peer reviews and add their own opinions to the mix. With Amazon's mobile app they can take a photo of an object, and within seconds, a description of the product and a link to where it can be purchased appears on their screen. Items can be bought quickly and easily; 1-Click purchases do not require any additional data input (no names, addresses, or credit card numbers to key in) and Amazon Prime provides free two-day shipping—and complimentary TV, video streaming, and borrowing of e-books. If its customers are not ready to buy, Amazon saves their items for later access on any device.
Amazon's reliability builds trust; their customers know that when they purchase from Amazon their order will arrive intact and on time, if not early. The ability to set e-mail preferences—“We want to stay in touch, but only in ways you find helpful”—and to track orders online go a long way toward making customers feel like they matter. It is no wonder that one blogger wrote, “Amazon is liked so much because it is built to love.”4
Business-to-Business Companies Are Players, Too
Business-to-business (B2B) companies are also making strides in defining and delivering new levels of customer-centricity. Knowing that almost two-thirds of the research that potential B2B customers undertake takes place before a salesperson is contacted, the marketing automation and revenue management company Marketo creates myriad opportunities for prospects to educate themselves about this emerging field.
White papers, e-books, webinars, and videos are available in a Resource Center located on their website to assist potential customers in their early due diligence. Search engine optimization and contextualized advertising, topics we will explore in the coming pages, ensure that their prospects find their materials.
Once a potential customer has accessed their content, Marketo proactively offers them increasingly targeted content and invitations to events in hopes of being able to build a relationship. E-mail alerts notify prospects of new e-books and webinars on topics in which they have indicated an interest. The company carefully monitors recipient's reactions to determine the next best offer and the appropriate cadence for messages.
Because Marketo's communications are well targeted and well timed, prospects experience them positively, not as spam. Figure 1.3, for example, is a resourceful follow-up e-mail about an event for which Lisa had signed up for but was unable to attend. Engagement with Marketo also includes access to their social community of over 30,000 Marketo users, as well as on-demand training, and the ability to submit ideas to the company's product management team to shape the future of their products.
Figure 1.3Marketo Nurtures Leads with Personalized E-Mails
Just Ahead: Relief and Reward
We have come a long way during the last two decades. While much complexity remains, we believe that we are entering a time of refinement. After gulping down innovation for two decades, going forward marketers will be able to chew a little more thoroughly. This does not mean that invention will stop, that competition will become less fierce, or that the pace of business will slow. Nor does it mean that those who remain standing have secured a place in the future. It does mean that much of the innovation on the horizon builds and improves upon the seismic transformations that have already altered the landscape. Shakeouts and consolidations will be plentiful as the market integrates. As the dust settles and we gain comfort in our new skills, creativity will flourish.
The ability to create and deliver remarkable customer experience will be the signature of successful companies in this next phase of marketing. It is how we manifest our customer-centricity and what our prospects and customers have come to expect and reward. Organizations that are able to figure out what their prospects and customers want and expect, in terms of products, services, spaces, and the accompanying experiences, and deliver on this insight, will develop a powerful customer experience differential, a key source of differentiation in an environment where commoditization of our best ideas and efforts happens all too rapidly. This differential will drive results—it already is.
Working with five years of data from Forrester Research, Inc.'s Customer Experience Index, a yearly benchmark of businesses' customer experience quality, Watermark Consulting found that the stock performance of companies considered to be customer experience leaders exceeded that of both the S&P 500 and the customer experience laggards.5 Customer experience leaders had a cumulative total return of +22.5 percent over the half-decade period compared with a −1.3 percent decline for the S&P 500 market index and a −46.3 percent decline for the laggard portfolio over the same period (see Figure 1.4). Here is the bottom line: customer experience matters. Whether we deliver remarkably good or remarkably poor customer experiences, it impacts our results.
Figure 1.4Focusing on Customer Experience Pays
Source: Harley Manning, Forrester Research, Inc. Blog, “When It Comes to Total Returns, Customer Experience Leaders Spank Customer Experience Laggards,” Forrester Research, Inc., September 14, 2012.
With customer experience driving the growth agenda and performance measures for companies going forward, marketers are in the enviable position of holding the keys to the kingdom. To rise to the occasion, we must be able to think and act beyond our traditional turf to proactively build the necessary skills to take our brands and companies to new levels. It is a good time for us to roll up our sleeves, digest what has happened, home the skills that are needed to benefit from these developments, re-energize our creativity, and get on with creating value in this new customer-centric marketing landscape.
What Do We Mean by Customer-Centricity?
Much confusion exists around the definition of customer-centricity. Some false notions of customer-centricity that are expressed with some regularity include:
Being all things to all people;
Treating all of our customers the same;
Attempting to meet every need our constituents have;
Allowing our customers to haphazardly determine our strategy from minute to minute; or
Blindly copying what Amazon, Marketo, and other market leaders are doing.
We define customer-centricity as helping our prospects and customers achieve their goals in a way that makes sense for our organizations. In this coveted sweet spot, depicted in Figure 1.5, our solutions meet our prospects' and customers' needs and desires. We are operating in a place of shared value, playing on the same team, and pursuing the same goals. That is a powerful combination.
Figure 1.5 Shared Value Is the Coveted Sweet Spot
As a result, customer-centricity is uniquely defined for every organization; however, two underlying principles are the same for every organization:
Customer-centricity is demand-driven, concentrating on meeting our customers' needs and desires.
Customer-centricity is focused, prioritizing our efforts on those customers' needs and desires that we can serve well and profitably.
Walk in Our Customers' Shoes
A deep understanding of our customers, perhaps even better than they know themselves, is a prerequisite to effectively meeting demand. This includes comprehending their needs and desires, motivations, attitudes, and existing knowledge, as well as their ongoing cross-channel behavior, preferences, and the triggers that prompt them to act. Staying current on these variables is a daunting task, as they change often. It is important, however, because this understanding, when coupled with a solid grasp of emerging trends and players in the marketplace, drives today's results and grounds our hypotheses about future demand. Our ability to rapidly test these hypotheses and to translate the resulting insight into innovative business models, products, services, and experiences keeps our companies relevant.
To truly understand our customers, we must shift points of view to see the world through their eyes. Flipping perspectives is hard because we are often entrenched in seeing the world from where we stand. It requires rethinking many tried and true, often producer-centric policies, practices, and frameworks.
To facilitate this flip, creativity and innovation consultant Tim Hurson encourages us to visualize our customers' needs and desires as itches they want to scratch. These itches can be physical, emotional, or psychological and they can be active, emerging, or latent. The most promising business opportunities generally come from addressing emerging and latent itches; who knew we could not live without a mobile phone or tablet until we had one in our hands? To identify the underlying itch, Hurson recommends that we ask, “If your [customer's] itch were a T-shirt slogan, what would it say?”6 To develop a more complete context for the itch, he challenges us to consider the impact of the itch, what we know about it, who else may be impacted by the itch or influenced it, and our vision for the future in which the itch has gone away.7
Applying a different metaphor when he was still teaching, former Harvard Business School professor Theodore Levitt encouraged his marketing students to think of customers as having an underlying job that they are trying to complete. Most of these jobs have a social, functional, and emotional component; Levitt believed that if marketers could understand this context, they would be able to create solutions that would appeal to their customers and prospects. Levitt illustrated this perspective to his students by explaining that, “People don't want to buy a quarter-inch drill. They want a quarter-inch hole!”8 Applying Levitt's framework, our task as marketers is to understand the job that our prospects and customers are trying to do, and design the experiences that enable them to do so.
Eenie Meenie Miney Mo
Truly customer-centric organizations are able to take this customer understanding to the level of the individual and differentiate their products, services, and experiences accordingly. Differentiating among our customers may at first sound anticustomer-centric, but it truly is not. Our customers are heterogeneous, with different itches and jobs, and varying abilities to scratch and get the job done. As a result, the overlapping area of shared value we have with each of our customers varies. By segmenting and prioritizing our prospects and customers, we can more effectively meet their needs and allocate our resources. This is not earth-shattering news. What is news is our newfound ability to know our customers well enough to pull this off and to have the marketing automation technology to do so at scale.
Consider the case of a luxury boat retailer. While there may be many people who say they want a 50-foot sailboat, a much smaller segment can actually purchase one, and an even smaller set is ready to purchase one now. If we were designing a marketing strategy for the luxury boat retailer, we would recommend prioritizing active engagement with those customers who want to purchase a sailboat, have the ability to do so, and are ready to do so. This would involve a customized flow of content based upon their interest and behavior and engagement with our salespeople when they have been determined to be sales ready.
We would also recommend a nurturing strategy for those prospects who have the interest and ability, but for whom the timing is not right. This would involve a smart stream of content, which becomes increasingly detailed based upon the prospects' actions. A low-involvement, self-servicing strategy would be appropriate for those who are interested, but not yet able to purchase. By knowing its prospects and customers well, the boat seller would be able to design relevant customer experiences that effectively meet the varying needs of the market and most efficiently use its resources.
Realizing the Customer-Experience Differential
Our commitment to customer-centricity manifests itself in our customer experience. When we talk of the customer experience differential, we are talking about consistently meeting or exceeding our customers' expectations for our brands and accomplishing this with more perceived value than our competition. Expectations vary by brand; people naturally have different hopes for shopping excursions to Costco than to Nordstrom; both brands focus on delivering quality, but in very different ways.
Our customers' perceptions of our brands and whether or not they meet the grade are based on their experiences with us. A person's brand experience is defined as the “sensations, feelings, cognitions, and behavioral responses evoked by brand stimuli.”9 These experiences can come in all shapes and sizes. Digital channels have magnified the number of potential brand encounters and have created a digital dimension for every product and service.
Take a Starbucks espresso, for example. There is the robust, slightly bitter drink itself, with its thick, swirled crema that floats on the surface and its satisfying aftertaste. People's experience of their espresso extends far beyond the cup of coffee itself, however. It can include searching for a Starbucks location: how easy is it to find digitally and physically? It can include the purchase experience itself, including the design of the venue, the personality and skill of the barista—Do they remember my drink preference?—the length of the lines, the comfort of the chairs, the cleanliness of the bathrooms, and the speed of the Wi-Fi connection.
For some customers the quality of the Starbucks espresso experience may also include their mobile phone. The Starbucks mobile app lets them pay by scan, receive personalized text offers, and manage their loyalty points (see Figure 1.6). The espresso experience may also include life between coffees. Starbucks' 35.9 million Facebook fans and 5 million Twitter followers clearly want to engage with the company. For others, purchasing their espresso from Starbucks may be an expression of their values. They may feel connected to the company via its social and sustainability efforts, as represented in the program's tagline, “You & Starbucks: It's bigger than coffee.” And that is only a fraction of the possibilities.
Figure 1.6 Starbucks App—Mobile Payments, Automated Loyalty, and Text Communications in One
Source:http://www.starbucks.com/coffeehouse/mobile-apps/mystarbucks
We refer to the sum of these brand impressions over time as the customer experience journey. These experiences can take place while our customers are searching, evaluating, or consuming our products or services, as well as between purchases and even outside the purchase process. Every one of these encounters is considered a touchpoint.
Touchpoints can be static, meaning one-way communications from us, such as when a customer receives a direct mail piece from us, or they can be interactive, like a tweet exchange or a visit to one of our stores. (Recognizing the value of engaging with our customers, most of our static brand experiences now invite our customers to engage with us in more interactive environments.) They may involve direct interaction with our employees in environments like a call center or sales call, or they may stop short of that with a simple download of a white paper. Each of these touchpoints is supported by a complex and interconnected system including Operations, IT, Finance, Human Resources, and Marketing, and by a broader ecosystem, which may include manufacturers, suppliers, media partners, and retailers.
Our prospects' and customers' brand experience include all of the interactions they have directly with us, as well as the interactions they have about us with their peers. Social media has fostered a recommendation-based global economy, creating unprecedented opportunities for people to seek out information from peers and to influence others. Some of these conversations take place in our branded social environments in the form of a post on our Facebook page or comment on our blog. Many take place in other public and private social environments and plenty still take place around the water fountain or over a cup of coffee.
Each brand experience contributes to people's overall perception of our customer experience (see Figure 1.7). Trust us, customers always have a perception of their encounters with us. These responses range from horrible to great or perhaps the dreaded state of indifference. These perceptions are fluid; they can change over time with additional encounters.
Figure 1.7Multiple Touches Shape the Customer Experience
These perceptions are significant—they largely define our brands. As our customers write tweets, texts, reviews, upload photos, and make recommendations, they are shaping our brands. This communication amounts to a lot of influence, on par with the big advertising spends of days gone by, because word-of-mouth influence is powerful stuff in a recommendation-driven environment like ours. These perceptions also determine whether our product or services will ultimately be acquired as research shows that brand experience is the single biggest factor in a prospect's decision to purchase a product or service.10
Get Customer Experience Savvy—It Pays
Clearly there are many moving parts that contribute to how consumers experience our brands, some of which are in our control and some of which are not. (The manufacturing company John Deere identified over 525 possible touches with its constituents!) These moving parts have to work together, consistently, to deliver remarkable brand experiences that capture our customers' attention and that stand out from the competition in a positive way.
Recognizing the complexity of the task, it is logical to ask ourselves if it is really worth the effort. Rest assured, there is gold in them hills. The customer experience differential represents a large opportunity for multiple reasons:
Customer expectations for brand experience are widespread.
According to a recent study conducted by the marketing agency Jack Morton Worldwide (JMW), over 80 percent of people say that they are more likely to consider brands with differentiated experiences.
11
Although this is true across market segments, people between the ages of 25 and 34 are “most likely to consider, recommend, or pay a premium price based on a better brand experience.”
12
Similarly, research undertaken by the strategy consulting firm McKinsey & Company found that customer experience impacts two-thirds of the decisions customers make; price often drives the remaining third.
13
Heightened brand experience expectations are not just characteristic of customers in mature markets. In China, for example, 93.8 percent of consumers surveyed said they were more likely to consider brands based on experience, compared with a worldwide average of 80.4 percent.14
Few companies have made inroads into realizing the customer experience differential to date.
Although most managers believe that they are already delivering great brand experiences, a 2013 survey undertaken by Forrester Research found that only 8 percent of consumers agreed. In fact, 61 percent rated their experience as ranging from okay to poor or very poor.
15
This is a significant disconnect—and opportunity.
Forrester also found that some industries are so lacking in customer focus—health insurance plans and Internet service providers are at the bottom of the list, as shown in Figure 1.8—that simply being adequate can create a point of differentiation from the competition. In most industries, however, there are one or two exceptional leaders and many others that lag significantly behind.16
Figure 1.8Customer Experience Varies across and within Industries
Source: Megan Burns, Forrester Research, Inc. Report, “The Customer Experience Index, 2013,” Forrester Research, Inc., January 15, 2013.
Remarkable customer experience pays.
Customer experiences with brands impact margins. American Express found that 67 percent of Americans would spend an average of 13 percent more with a company that provides excellent customer service.
17
Not surprisingly, advocacy is also affected. JMW found that 87 percent of those surveyed said they are more likely to recommend a brand based on superior experience.
18
In fact, 79 percent said they would
only
advocate for brands
after
they have a great customer experience.
19
USAA Understands and Delivers
In the financial services industry, the United States Automobile Association (USAA) leads the pack in terms of customer experience and with good reason: they have made a concerted effort to engage their entire company in the effort. A few years ago the company, which serves military personell and their families, consolidated its customer-experience–related operations under an EVP of member experience. Today, almost half of USAA's employees are on the member-experience team, which is responsible for “setting strategy, monitoring performance, and driving innovation.”20
To enhance its members' experience, the company recently reorganized its product offerings to better reflect and anticipate the actual steps that USAA members take when purchasing their products. For example, knowing that when their members purchase a car they may be also looking to secure a car loan and insurance coverage, the company now bundles these offerings into an integrated service. Through its mobile app, website, and/or contact centers, or some combination thereof, the company's 9.7 million members and their families can easily find, finance, and insure a car.
Seeing its business through the eyes of its customers paid off. Today, USAA enjoys the highest customer experience rankings across all three industries in which the company is active. These rankings translate into hard cash: the company has enjoyed double-digit increases in auto sales and loans.
What Do Our Customers Want from Us?
People's expectations for brands are increasing; 57 percent of customers say they hold brands to higher standards than they did previously.21 Our customers become accustomed to the standard of experience offered by companies like Amazon and Marketo, which is always being enhanced. Yesterday's exceptional experiences quickly become today's baseline.
To stay relevant, we have to keep our finger on the pulse of what really matters to our customers and build remarkable experiences around that. As a result, the answer to the question—What do our customers want from us?—will differ for every organization; however, there are some basic elements of customer experience that are becoming universal.
Understand and Meet Their Needs
To attract and sustain our prospects' and customers' attention and win their business, we have to offer products, services, and experiences that meet their needs or desires. An understanding of the underlying customers and their needs and desires must accompany this functionality, creating tremendous opportunities for brands that can develop truly empathize with their customers and translate that understanding into products, services, and experiences.22
Our marketing must also be purposeful, achieving what marketing consultant Jay Baer describes as, “Youtility,” marketing so useful that our customers would pay for it.23 We can offer entertainment, inspiration, information, or self-actualization, but without being useful, we do not have a shot of being invited in to the customer journey.
Useful does not mean boring. In fact, useful experiences are usually drawn from deep wells of creativity. Take a look at what Nike is doing as an example. Knowing that its customers enjoy the opportunity to express themselves, Nike encourages them to design their own running shoes. By offering them the chance to personalize their shoes on the basis of performance features and appearance, Nike gives its customers the opportunity to say to the world, “This is who I am.”
Recognizing the larger aspiration behind their customers' purchase of running shoes, Nike designs experiences that help them reach their fitness goals and enjoy an active life. Runners can map their runs—including elevation details—and track their workout progress through the Nike+ app. When they need a bit of extra motivation to make it up that last hill, Nike's customers can choose a high-energy song from one of the company's playlists. If they have previously alerted their friends of their run on Facebook or Path, they can hear real-time cheers along the way for every like or comment they receive (Figure 1.9).
Figure 1.9Nike Helps Its Customers Reach Their Fitness Goals with its Nike+ App
Source:iTunes.apple.com/us/app/nike+-running/id387771637
For their street-soccer fans in Spain, Nike goes beyond the call of duty to provide opportunities for pickup games. Through #MiPista, the company creates temporary playing fields with laser beams projected from a crane onto flat open surfaces below. Using their smartphones, players can request that Nike's traveling team install a temporary soccer field and then get to work rounding up players. Within minutes, empty spaces are transformed into illuminated street-soccer fields. Take a moment to enjoy photos on Nike's blog; they are inspiring.24
For anyone, anywhere, who is interested in being fit, Nike offers its FuelBand, an electronic bracelet that tracks and measures their movements throughout the day, whether generated from a tennis match, an early morning run, or just walking around the office. Movements are measured in NikeFuel, a proprietary metric that can be evaluated over time, shared with friends, and applied to unlock levels and content on the company's digital game, NikeFuel Missions. It is experiences like these that delight Nike's customers and generate $25 billion a year in revenue.
Offer Relevant Interactions
Today's time-pressed customers want relevance. For many years we have operated under the assumption that our customers want more options; however, research conducted by American psychologist Barry Schwartz found that for most people, having too many options is anxiety producing rather than freeing.25 Highly targeted experiences that zero in our customer's needs and desires simplify their lives; for many that is considered a gift.
Diane Hessan, CEO of Communispace, which creates private online customer communities for companies, describes this gift in the context of a couple. Tired after a long workweek, they are making plans for Friday night dinner. The man texts his girlfriend asking her to make the reservation at any place she wants, thinking he is doing her a favor by letting her choose the type of food and the venue they will enjoy. Rather than being energized by being given the choice, the woman thinks to herself, “If he really loved me, he would handle this, so all I have to do is show up. I would have even paid!”
What does this mean for marketers? Relevance is nothing short of offering the right experience, in the right format, on the right device(s), when our customers are ready. Relevance increasingly requires contextualized experiences that reflect the individual customer's behavior, preferences, current situation, and are often predictive. This type of personalized marketing experience has long been a dream for marketers, and big data and advanced analytics are now making this dream a reality. From our customers' point of view, relevance means feeling known, not in an invasive or creepy way, but in a way that says, “Can we be of assistance?” It is the difference between being welcome and being annoying.
In the case of Starbucks, relevance could be a personalized e-mail (or SMS text) sent to a customer at the time of day when he or she frequently makes a beverage purchase. The e-mail could feature the signature Starbucks' cup and, as in Figure 1.10, include the customer's name and maybe his or her favorite drink order.
Figure 1.10Starbucks Customizes Its Customer Interactions
Or relevance could take the form of a personalized video or a Pinterest-like digital bulletin board, sent to a prospect who has recently visited a retailer's website to evaluate and price televisions. The content could provide additional information about the models that caught their attention, including customer ratings, details about nearby stores where the selected models are presently in stock, and a link enabling an online purchase.
Invite Participation
The interactions that Amazon, Nike, and Marketo enjoy with their customers incorporate another important component of today's customer-centricity: participation. This broadcast era of one-way messaging is gone; effective communication now is about engagement. Customers are often looking for us to provide more than just a product or a service: They are looking for experiences.
Experiences can be digital, physical, or some combination of both. The interactive mobile app, Stylewhile, for example, adds a new dimension to the digital shopping experience.26 Shoppers can visualize what outfits will look like by dressing an avatar, whose skin tone, hair, and body size can be adjusted to resemble the person for whom the item is being purchased. The app facilitates a fun and novel experience, while removing one of the challenges of purchasing clothes online: visualizing how clothes will actually look.
Similarly, retailers who adapt their in-store experience to leverage the unique capabilities of mobile are finding that it increases sales.27 The Sprooki shopping app, for example, enhances the in-store experience for shoppers in Singapore.28 While in or near the mall, shoppers receive deal alerts on their smartphones from participating retailers. If intrigued, would-be buyers can browse and purchase the items directly from their smartphones and pick them up at their convenience.
Creating digital communities around our brands provides our prospects and customers with some of the richest experiences. It might be hard to conceive that people want to connect around diapers, but they do. The Huggies Community, for example, brings together parents to talk about all things child-related. Dell Ideastorm invites customers to cocreate new products and services and to enhance existing offerings. One of the first companies to publicly tap customers for ideas since the site's launch in 2007, the company has garnered more than 15,000 ideas from interested users and implemented close to 500 from them.
Engage Before, During, and After
Our customers want to be educated and engaged on an ongoing basis. According to a study conducted by JMW, this is especially true for customers who say that unique brand experience impacts their brand choice.29 Many want self-service access to content early in the customer journey, so that they can evaluate potential purchases before they contact a salesperson or walk into a store. Some want ongoing connections after a purchase is made—timely information that keeps them in the know, invitations to special events, and opportunities to share their experience and opinions. By inviting engagement throughout the customer experience journey, we can develop relationship-based loyalty, rather than the more fickle transaction-based version.
To keep its fans engaged, Scrabble set up free Wi-Fi hotspots across Paris in areas lacking coverage. To access the Scrabble network, people were invited to play a digital version of the game, which unlocked the necessary password. The length of time awarded on the network was based on the player's Scrabble score; better spellers were rewarded for their skill with more time. In addition to enabling the brand to connect with its fans, the experience prompted Scrabble players to try the digital version of the game.
Keep It Simple
Ease of use is highly important to today's customers, who have short attention spans and little patience for anything lengthy, delivered slowly, or technically imperfect. The average attention span of adults has decreased from 12 seconds in 2000 to 8 seconds in 2012, giving us the distinction of now having a shorter attention span than a goldfish (9 seconds).30 The average American in his or her twenties switches media venues 27 times per non-working hour. He or she also multiscreens, browsing multiple screens at once, often absorbing unrelated content simultaneously.31
As a result, interacting with us has to be easy, inviting, and hopefully fun, or our customers will go elsewhere. At its best, the technology we employ to engage with our customers should be so simple that it is invisible; the experience that the tools are trying to deliver should be what is remembered. When our customers connect with us in person or over the phone, our employees should be so helpful and the processes so streamlined that people notice—and are perhaps even delighted.
Ease of use also means that our engagement with customers takes place where they are, not where it is most convenient for us to be. We can assume that our customers want to communicate with us in a
