THE CUSTOMER EXPERIENCE
PRIORITY ONE FOR CMO
sCONTENTS
Foreword ...2
Introduction ...3
Customer experience is the #1 priority for marketing executives ... 4
Driving Growth Strategy ...7
Personalizing Experiences Using Data Analytics ... 9
Building Trusted Relationships Through Social and Mobile...11
Conclusion ...13
Those days when companies told customers what to think about their products or services — and customers listened — are long gone. The customer is now in control. They listen to their family, friends or social networking communities instead of the company itself when making purchasing decisions. Marketing is no longer about the product. It has to be about the customer — her needs, behaviors and the personalized experience she is looking for.
It’s about developing trusted relationships and creating amazing customer experiences that the customer will then go and tell her friends about.
In September 2013, Forbes, in collaboration with EY, conducted a survey of 321 US senior executives from a broad spectrum of industries about the evolving role of marketing in a world where the customer is king. Respondents ranged from C-suite executives to VPs to Directors and held roles in marketing, IT, operations, finance, management and strategy.
HERE’S WHAT WE LEARNED.
INTRODUCTION
CUSTOMER EXPERIENCE IS THE #1 PRIORITY FOR MARKETING EXECUTIVES
69% see the customer experience as vital to drive growth strategy as well as marketing strategy
66% of leading organizations say collaboration across the enterprise is key to addressing customer experience challenge versus 38% of those who feel their marketing initiatives are only adequately addressing their needs
Only 12% are taking full advantage of data analytics to better understand their customers
69%
66%
12%
PLAN TO INVEST MOST HEAVILY
IN WEBSITES
IN SOCIAL
NETWORKS IN MOBILE APPS
60% 56% 51%
MARKETING EXECUTIVES RANK CUSTOMER EXPERIENCE AS THE MOST IMPORTANT PRIORITY FOR THEIR MARKETING DEPARTMENT, OVER NEW PRODUCT INNOVATION, BRANDING, CONTENT CREATION, IDENTIFYING NEW NEEDS AND PRICING – WHICH RANKED DEAD LAST.
Marketing Non-marketing Changes in
customer behavior
Harnessing big data
Mobile
Social media
61%
72%
60% 65%
59% 66%
48% 59%
KEY CHALLENGES
The number one challenge respondents identify in creating an amazing customer experience is changes in customer behavior.
Specifically, respondents worry about consumer demands for a more personalized experience or an influential voice in their experience.
Non-marketing executives are more likely to point to customer behavior as the key driver of challenges than marketing executives.
Conversely, marketing executives worry more about social media than non-marketing executives. Marketers understand both the vast opportunities and the risks in using a medium where customers cringe at direct marketing efforts.
A majority of executives (58%) — marketing and non-marketing executives alike — feel their marketing initiatives adequately enable them to address the challenges they face. One-third (33%) believe their marketing initiatives only enable them to tread water.
We have to have an intimate understanding of the consumer journey
when shopping for a vacation, so we can reach them at the right moment
and in the right venues.
– AIRLINE EXECUTIVE
In fact, across a wide range of questions that explore how well marketing initiatives are addressing the key challenges, organizations that are best prepared are focused far more strongly across all areas of the customer experience, from optimizing interactions in every channel to redesigning the customer experience in mobile, online and in-store.
Respondents who see marketing initiatives adequately addressing changes or falling short Respondents who see marketing initiatives addressing changes exceedingly well Consistent management of the customer
experience across all touch points Delivering superior and differentiated customer experience over competitors (given product and price parity) Measuring customer satisfaction
Strong collaboration with other business units
Personalization and real- or near real-time understanding of customer behavior
63%
87%
72%
85%
64%
85%
42%
78%
52%
76%
Leading organizations work to deliver a carefully designed customer experience from point of sale, to activation or installation, to follow-up and future purchases. For leaders, it’s about placing equal emphasis on creating consistency across all touch points, delivering a superior and differentiated customer experience, and measuring customer satisfaction — in real time.
They also do a better job of collaborating with other business units, and their initiatives enable them to gain a real- or near
I spend as much time working in areas of the business that are not traditional marketing areas as I do thinking about
media mix and where to buy our next ad position.
– AIRLINE EXECUTIVE
WHAT LEADING COMPANIES ARE DOING RIGHT
KEY CHALLENGES
Organizations that see their marketing initiatives only adequately addressing needs or falling short face challenges in two key areas:
1. Their customer experience is misaligned to the priorities of IT and other functions within the organization.
2. Their marketing teams avoid collaborating with other stakeholders across the enterprise that touch the customer experience.
In fact, fewer than half of executives indicate that they collaborate with finance, IT or digital, and fewer than two-thirds of executives collaborate with strategy. Marketers are less likely to say they collaborate than non-marketing executives, in large part because marketers need to see the value in collaborating with other parts of the
organization before agreeing to it.
DRIVING GROWTH STRATEGY
In a world where the customer is firmly in control, the customer experience appears to be driving more than marketing strategy. Within 70% of organizations, the increasing emphasis on the customer experience is driving business growth strategies. This percentage increases to 93% for companies that are best prepared to face the changing customer landscape. Similarly, 70% of leading organizations are focused on redesigning areas of the customer experience, and 66% see collaboration with any aspect of the business that touches the brand as crucial to their success.
The average age of a car buyer is in their late 40s. The expectations
and shopping experience have changed — everything from how they are talked to, to when they get
information about a product.
– CMO, AUTOMOTIVE
Leading organizations, on the other hand, are far more inclined to collaborate across all four major areas: strategy, finance, IT and digital. They have a deeper understanding of what other groups within the organization are doing and how to leverage the collective capabilities and strengths to address the changing environment. Much of their drive for collaboration may stem from the fact that they see the customer experience as a strategic differentiator — from product design and development, to sales and marketing, to purchase, activation and retention. With the range of product and competitive pricing options available to consumers, experience becomes a key growth imperative.
68%
93%
38%
66%
34%
71%
Respondents who see marketing initiatives adequately addressing changes or falling short Respondents who see marketing initiatives addressing changes exceedingly well
Emphasize the customer experience as part of the company’s business growth strategy
Marketing strategy is focused on redesigning areas of the customer experience
Manage the customer experience in all areas where there is contact with our brand
We don’t have a silo-driven culture at all. We are highly integrated across sales, marketing, R&D and finance.
We [achieve collaboration with] good, smart communication.
– CMO, PHARMACEUTICAL COMPANY
WHAT LEADING COMPANIES ARE DOING RIGHT
Improving the customer experience means getting to know the customer by analyzing his patterns and behaviors.
It requires understanding and then strategically using data analytics to sift through all of the unstructured data an organization collects on a customer — the Big Data. This needs to be a joint process among marketing, IT, finance and digital departments.
This may explain why only 12% of executives strongly agree that they are taking full advantage of data analytics to better understand their customers and to rapidly act on that information.
PERSONALIZING EXPERIENCES USING DATA ANALYTICS
KEY CHALLENGES
Organizations overall are struggling to harness the power of structured and unstructured data to create a personalized experience across their digital and physical channels. Fewer than half of respondents say that they are able to collect and analyze data from CRM systems, social networks, e-commerce sites, email systems and mobile apps.
Of those who do not believe their companies are using data analytics to harness the value of the data they are collecting, the number one reason is lack of resources, followed by a lack of advanced analytics capabilities.
Respondents who see marketing initiatives adequately addressing changes or falling short Respondents who see marketing initiatives addressing changes exceedingly well 57%
46%
42%
51%
48%
56%
35%
44%
31%
37%
27%
29%
23%
27%
CRM systems
Social networks
E-commerce site
Email systems
Mobile apps Company or brand website
Point-of-service
Although leading organizations may be struggling to use data analytics, they appear to excel at gathering and analyzing data from point-of-service, CRM systems and social networks. They then share the insights they learn with sales, marketing and support channels to enable personalized experiences aligned to the needs and behaviors of their customers.
In terms of capabilities, leading organizations that indicate their marketing initiatives address changes exceedingly well are much better at real- or near real-time segmentation, deploying automated messaging and social listening.
However, they are on par or worse at analyzing and testing new offers, automating performance reporting and developing key performance indicators (KPIs).
There is an old saying: ‘Fifty percent of my advertising budget is a waste of money, but I don’t know which half.’ With data analytics, we can tell which half.
WHAT LEADING COMPANIES ARE DOING RIGHT
– CMO, AUTOMOTIVE COMPANY
Marketing executives Non-marketing executives Mobile as a key
challenge
Social media as a key challenge
60% 65%
48% 59%
When the customer experience fails to meet aspirations, organizations should turn to the digital landscape to grow customer value. Improving the quality and frequency of contact with customers can improve loyalty. Certainly, marketers know this. However, they also understand, more than their non-marketing executive counterparts, the challenges of a medium that breaks the rules of traditional marketing. On many social media platforms, customers dislike a direct sales approach. As a result, companies have to develop a whole new mindset and type of monitoring.
BUILDING TRUSTED RELATIONSHIPS THROUGH SOCIAL AND MOBILE
KEY CHALLENGES
In this non-traditional environment, executives view losing control of the conversation and the customer experience as huge challenges. This would explain why 60% of executives note that they plan to invest most heavily in company or product websites, 40% in e-commerce and 51% in mobile apps.
However, there is a sizable gap — 17 percentage points — between what marketers and non-marketers think when it comes to investing in a mobile-optimized site (47% of marketers versus 30% of non-marketers).
IN ANOTHER EY SURVEY, VOICE OF THE CONSUMER:
It’s time for insurers to rethink their relationships. Although insurers are using digital channels to help target potential prospects, the two biggest drivers of digital strat- egies are enriching the customer experience and regaining more direct control of the customer relationship.
Although social networks top the list across the board as a major investment area, 66% of leading organizations say they will invest in social networks, which is not surprising as the leading social networking platforms reach well over 1 billion users. Similarly, leading organizations are planning greater investments in e-commerce. Interestingly, leading organizations indicate that they are less likely to invest heavily in mobile apps or mobile-optimized sites than average or below-average organizations.
39%
54%
55%
33%
66%
50%
47%
30%
Marketing executives Non-marketing executives Leading organizations
Average or below-average organizations Mobile-
optimized sites Social networks Ecommerce
Mobile apps
– CMO,
AUTOMOBILE COMPANY
60%
WEBSITES
51%
MOBILE APPS
40%
WHAT LEADING COMPANIES ARE DOING RIGHT
We sell millions cars a year. We can’t
study every single customer. We do tend
to bucket customers into profile — these types of people watch college basketball but
not professional basketball and based
upon that we can
customize messaging.
A great deal has changed about how organizations market to consumers. What has remained constant is the fundamental need to focus on the customer.
As CMOs, executives and organizations in general assess what kind of presence to have across digital media — websites, social networks, mobile apps, e-commerce and email — and how to create it, their number one priority must always be the custom- er experience. The ability to build trusted relationships with their customers will separate the leaders from those left behind.
Data analytics will certainly play a role in building these relationships
— gathering, identifying, tracking, measuring and monitoring customer data to enable organizations to personalize customer experiences that consumers will go and tell their friends, families and online communities about.
However, harnessing the data organizations have at their disposal and even creating the most amazing customer experience will be possible only if every function that touches the customer works together. The ability to share information, technology, skills and capabilities will ultimately separate the winners from the losers in the increasingly competitive battle to win — and keep
— the omnipotent customer.
CONCLUSION
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