More than any other business function, the CMO and marketing-department roles have changed in rapid and radical ways during the past few years.
From socially empowered customers, to a shift to a mobile-first world, to heightened MROI expectations, the dynamics at play are many--and show no signs of slowing, according to attendees at the recent CMO Exchange (#CMOExchange), held late last month in Miami.
“The CMO Exchange – Miami theme revolved around transformation and what it means to marketers in today’s complex business environment,” said Winsome Gilbert, program director of IQPC Worldwide, which hosted the event. “The interactive sessions allowed for true peer-to-peer networking and provided opportunities for attendees to learn and share best practices with colleagues from some of the most respected brands in the world.”
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As always, the CMO Exchange covered plenty of strategic ground, with implications for marketers in virtually every B2C and B2B industry. Foremost, we consistently heard that marketing has shifted into the “age of content, consumer conversation, and engagement.” An overarching theme was that these shifts have created the need for CMOs to become more adept and agile at leading significant change and partnering with their C-suite peers to operationalize mission-critical initiatives across the enterprise. In other words, we are also in the “age of the CMO as change-management operator.”
CMO.com editor in chief Tim Moran and I spoke with the most forward-thinking of these CMO change-management operators, as well as several CEOs . Here’s what we learned, with takeaways that could very well apply to your marketing situation.
Revolutionary CMO Changes Are Here
Kimberly A. Whitler (@kimwhitler), who is a P&G-trained three-time CMO and currently an instructor at Indiana University’s Kelley School of Business, led a panel discussion focused on “The Evolving Role of the CMO.” She was joined by Acxiom CMO Tim Suther (@timsuther) and Steven Bushong, SVP, Marketing Operations, Entertainment Marketing, at ABC Entertainment.
Prior to the CMO Exchange, Whitler conducted a beta survey with the CMO Exchange attendees on the topic of her panel. “The headline insight from this beta sample is that the CMO role is changing. . .not evolving,” she said. “From the CMOs’ perspective, it’s clear that they believe their world has significantly moved. This is a revolution.”
For example, CMOs indicated that their role has become significantly more important to the organization. “While many pundits have prognosticated the end of the CMO, these growth-oriented CMOs don’t agree with them,” Whitler said. (For additional insights, read her recently published article, “Is the CMO Role Dying or Thriving?”)
Changes in CMO demands, of course, require new capabilities. “Must-have skills required of the next-generation CMO are analytical and integrative thinking skills, influence/persuasion, and strategic thinking,” she said. “Future marketing leaders also will need to enhance their knowledge in these key areas: understanding the rewards and motivations of others, financial knowledge, IT/systems, and digital knowledge.”
Acxiom’s Suther built on these points. “All marketers share a common goal: how to better engage empowered individuals. Times for CMOs have changed, and the relics of past marketing practices won’t drive us forward,” he said.
To be successful, smart marketers are “narrowcasting,” he said. “They increasingly put the consumer first, and let the channel and product decisions follow. They drive actionable insights, not just with big data, but with better data grounded in the intersection of insights they and their most important partners possess.”
Marketers, Suther added, need to adopt a data-first orientation. “For marketers to turn this asset to their advantage, they need tools and processes to turn big data into better data,” he said. “The proper tools and processes enable marketers to break down silos and use data across channels to better understand customers, improve satisfaction, and upsell. The opportunities are limitless, just like the data.”
ABC Entertainment’s Bushong continued by talking about the change-management work he is leading in broadcast entertainment. "Because of the changes in audience-viewing behaviors, we needed to become ‘agile athletes’ to adapt to the what, where, when, and how of content that people want to consume. We have to market our shows wherever people are consuming,” he said. “As we saw more consumers shifting to digital platforms, we hired digital experts. We are currently completing the transformation from a department where creative drives strategy to a function where strategy leads. We are still an industry of storytellers. We've had to create new production platforms to be able to respond in real-time to the explosion of platforms where our content is experienced and consumed.”
When asked what CMOs can do to embrace and own the dynamic changes impacting marketing, Bushong pointed to the need for leadership. “We need to align disparate corporate functions and demonstrate the value of what we do,” he said. “Be adaptable and get used to change, asking questions like, 'What is coming down the pike? What is changing in technology that might change my organization? How are younger people beginning to consume content, and how will this change the broadcast industry?'”
Bushong said he is a big believer in experimentation. “Then we evaluate to see how it moved the needle. I encourage people to try, try, try, and measure,” he said. “We condition our teams to be cross-functional. This builds a team approach that will help change the future. . .This helps sell ideas and position marketing as a contributor to business results, not just a maker of beautiful creative. It is also good to work with your business partners to identify marketing waste.”
Who Is Leading The Change Charge?
Suffice to say, becoming an innovative, influential change-management operator is a critical capability that senior marketers need to develop and use given the pace of change, higher expectations, and marketing’s potential to impact across the business enterprise. I was fortunate to lead a panel of four diverse B2C and B2B senior marketers to compare our recent change-management operator experiences with a focus on influencing results in three critical areas important to any business: improving customer engagement; building a differentiated, highly regarded brand; and growing revenue with improved MROI.
You can see our panel presentation here. In addition, I asked the executives to share a bit more advice with CMO.com readers. From my perspective, I believe their insights are applicable to what every CMO and senior marketer needs to do today.
Filip Wouters (@FilipAWouters), Senior Global Director, Integrated Marketing Windows Phone, at Microsoft, and a global B2C brand building veteran, pointed to the introduction of the Windows Phone 8 as an example of what being a change-management operator means. “Today smartphones are everywhere, and the way we use them continues to evolve. We don’t just live with them--we live our daily lives through them. Apple and Google haven’t evolved their products to tap into this approach, and so this was an opportunity to change and shake up the market with an alternative experience.”
Wouters outlined a four-point plan that factored heavily into the Windows Phone’ marketing strategy:
1. Deliver a differentiated, personalized approach: “The core of the marketing change challenge was centered on delivering a differentiated approach that would engage consumers and build the Windows Phone brand. Simply, Windows Phone ‘is the smartphone reinvented around you. . .to keep you closer to what matters most,’” he said.
2. Connect your target consumers with what they care about the most in both product development and all consumer touch points of the purchase funnel: “We’re continually exploring novel ways to engage consumers in order to build the Windows Phone brand,” he said. One example is the brand’s YouTube channel.
3. Personalize global marketing: “Deliver an international campaign across multiple countries in a highly local and personally relevant way. For each market, we partnered with local celebrities to tell their unique and personal story through their Windows Phones,” he said. “This approach is very distinctive as it requires keeping the brand values consistent across countries while telling a highly personalized smartphone story in a locally relevant fashion, regardless of whether the consumer is in France, the U.K., or Germany.”
4. Track results across consumer engagement, retail, and brand-building metrics to the marketing mix: “We set up real-time measurement systems to track consumer engagement, retail activation, and key brand metrics. These provide a broad spectrum and allow us to optimize the various consumer touch points with very short lead times to achieve the most consumer impact,” he said.
Another savvy panelist, Lorena Harris (@harrilor), VP of Corporate Marketing at Vantiv, discussed the role of marketing technologies. “Leading data-driven customer-focused initiatives through the company in partnership with C-level and strategic partners is a critical new skill set that CMOs and senior marketers need as change-management operators,” Harris said. “This has been made possible, and mandatory, by marketing automation systems tied to sales automation systems. As these and other sophisticated data-management tools become ubiquitous, CMOs can constantly measure, analyze, and improve marketing functions. Going forward, marketing will be evaluated on ROI and revenue participation, so CMOs, and soon-to-be CMOs, must lead the change or get left behind.”
To redefine the marketing function as a revenue center and partner to the sales team, Harris said it is “crucial as a change-management operator to quickly establish three key initiatives:
1. Build thought leadership/content marketing programs: “This improves brand awareness, positions the company as an industry thought leader, generates qualified leads via multichannel digital campaigns, and provides the salesforce with high-quality content for client conversations,” she said. “This is crucial because a company needs to have something to talk about other than low prices or high service levels. Thought leadership helps position the company as a trusted adviser or innovator.”
2. Build an integrated, omnichannel channel mix that generates revenue: “Inbound marketing programs, such as social media, blogs, videos, SEO, and paid search, must be strategically integrated with traditional outbound channels, such as email marketing and advertising,” Harris said. “A focus on omnichannel programs can deliver two times more leads with four times higher close rates, and get marketing groups out of the business of filling a la carte orders that don’t move the needle.”
3. Implement a marketing automation system: “SaaS programs allow a marketing department to manage lead generation and nurturing, email marketing, analytics, reporting, and interoperability to create a continuous pipeline,” she said. “Marketing automation systems enable companies to transition away from traditional one-off marketing requests toward an integrated sales and marketing system with maximum revenue performance.”
Finally, Vince Ferraro (@VinceLFerraro), former VP Global Strategy & Marketing, Corporate & Consumer Group, at Eastman Kodak, and a global B2B and B2C brand-building veteran, had a fascinating set of “Kodak moments” to share.
“Much has been written about growing brands and businesses to new levels of success. Surprisingly, little has been written about how to manage a brand when a company and its products and services are in decline,” he said. “Such was the case when I managed corporate and consumer marketing during Eastman Kodak’s Chapter 11.”
Ferraro said he learned valuable change-management operator lessons during that time--lessons that, ironically, can be applied to companies that are growing and vibrant:
- Don't expect a call to be a leader. Just act and do. Lead the change you want to have happen.
- Know the limits of your brand.
- Know when to let go of unprofitable customers. If you try to please everyone, you will wind up pleasing no one.
- Tell your unique brand story and value proposition, and be in control of it versus letting everybody else define what your brand story is.
- In an age of dynamic changes, learning how to deconstruct marketing functions and budgets is as important as constructing marketing functions and budgets.
- Using a zero-based approach to marketing budgets along with having meaningful metrics and analytics to measure results is necessary to identify what resources you should keep, discard, or outsource.
- Do the fundamentals exceptionally well before you "experiment" with new marketing techniques.
Embracing A New Customer Lifecycle
Ben Arnon (@benarnon), VP, Global Brand Partnerships, Wildfire, a division of Google, gave a compelling keynote on “How Social Media has Revolutionized the Customer Lifecycle.” I asked him to elaborate for CMO.com readers.
“The traditional linear customer lifecycle model is outdated with respect to today’s social consumers. . .those deeply plugged into social networks, absorbing information from news feeds full of commentary and opinions from their extended networks,” he said. “Today’s consumer creates reviews for his social networks, reads critiques created by his peers, and changes his purchasing decisions based on these conversations. Many times, the brand isn’t involved in any stage of the decision-making process.”
Consumers move through the purchasing lifecycle only when they’re engaged--that’s when they’re open to further brand exploration, Arnon said. “They move from discovery to evaluation, or straight into buying, or they’re moved to ask a question. No matter what move they make, changing their phase within the lifecycle, they are not affected into change without engagement,” he said.
The bottom line for marketers, according to Arnon: ”Marketing is no longer about what we’re saying, but what others are saying about us.”
Follow The Mobile Leader
Greg Stuart (@MMAglobal), Global CEO, Mobile Marketing Association, dialed the CMO Exchange audience into the mobile-first opportunity with an insightful keynote. In a follow-up conversation, he spoke of the “dynamic avenue” mobile has created for marketers to connect with their customers.
“Nothing gets marketers closer to consumers more than mobile, and nothing matters more to consumers than their mobile devices,” he said. “As marketers, we all strive to be within ‘arm’s reach of desire.’ Today, at the end of that arm, between it and desire, is a mobile phone. It’s as close to our consumers as we can get.”
Mobile has moved far beyond its roots as a communication device, Stuart added, and “is now a tool of action and transaction, offering consumers the power of immediacy,” he said. “There is no other channel as powerful when customers are in active decision-making mode.”
However, he acknowledged that marketers are still hesitant to consider mobile as an ROI builder. “To provide irrefutable evidence on mobile’s effectiveness, the MMA and Marketing Evolution conducted the Mobile X% Solution to determine the optimal balance of mobile in the marketing mix. The study found that by dedicating 7 percent of the annual marketing budget to mobile advertising, marketers would achieve better sales results for the same budget,” he said. “Recently, the MMA launched ‘SMoX.me’ (Smart Mobile Cross Marketing Effectiveness) to measure the impact of mobile. The study will determine the relative economic value of investing in mobile channels compared to traditional marketing channels.”
Creating Relevant Brand Experiences
In his keynote, Matt Wise (@ePrize), CEO of ePrize, encouraged CMOs to “think small.” Here’s what he meant: “The age of multiple screens has created a new breed of consumers… those who are simply more connected. Today's consumer blends their offline and online worlds without a thought. They are agile at mingling within digital communities, which are often highly experiential. For many, it's less about the product and the price; they want brand experiences that are relevant to their lives, tailored to their preferences, and that let them connect with others in a meaningful way.”
1. Think bigger. . .by thinking smaller: “Be flexible enough with your marketing tactics and between business units to engage consumers across virtually any digital channel all the way to point of sale,” he said. “It's time to think not only big, but holistically, to offer solutions when and where the consumer is ready to engage. The quickest and easiest way to achieve the big picture is to focus small, in the palm of your hand, on the mobile-first opportunity, and the millions of hands of your consumers. Being ‘always-on’ on personal and intelligent smart mobile phones and tablets means every piece of information--your Web site, online promotions, loyalty plays, coupons, emails, and now text messages--needs to be optimized and accessible in a mobile-first way.”
2. Truly put a face to your consumer: “The last thing that your audience wants is to receive a one-size-fits-all message, a promotion for a product they just purchased, or a communication that is not timely. The key to success in this ultrapersonal world is to get permission and use it effectively,” he said. “By knowing an individual consumer's age, location, life stage, and even top 10 likes on Facebook, you can drive amazing interaction and results. For instance, our data shows that by tailoring mobile offers to loyal consumers at the right time, they are redeemed eight times more frequently and drive basket sizes two to three times greater than the same emailed offers.”
3. Vary tactics to keep active engagement: “Now that you ‘know’ your audience personally and are accessible to them at any time, keep the relationship alive. When we are personally rewarded for our patronage of a product or service, it creates a give-get relationship and adds emotion to the otherwise transactional connection,” he said.
Indexing The Customer Experience
Kerry Bodine (@kerrybodine), VP and Principal Analyst in the Customer Experience Practice at Forrester Research, is one of the world’s most prominent thought leaders on the topic of customer experience. She created an excellent CMO Exchange experience with her insightful keynote and by distributing copies of her recently published book, “Outside In,” to attendees. Bodine’s book helps business leaders understand the value of customer experience and how to transform their organizations to reap those benefits.
Bodine explained that Forrester defines customer experience as how customers perceive their interactions with a company. For the past six years, the researcher has been gauging exactly that through an annual benchmarking survey. “Specifically, we ask thousands of consumers the following questions about companies they’ve done business with in the past 90 days: How effectively did the company meet your needs? How easy was it to do business with them? And how enjoyable was it to do business with them? Based on their answers, we calculate a score for each company. . .and those scores, in aggregate, form our Customer Experience Index (CXi),” she said. “In our 2013 index, the retail and hotel industries took top billing, while Internet service providers and health insurance plans came in last. Overall, most of the firms received scores that are mediocre at best.”
The survey also poses several questions related to loyalty. “We find strong positive correlations between companies’ CXi scores and customers’ willingness to consider another purchase and their likelihood to recommend to a friend, and we find a negative correlation between CXi scores and customers’ likelihood to switch business and buy from a competitor,” Bodine said. “In other words, the better your customer experience, the more likely your customers will buy from you again and tell their friends about you, and the less likely they are to take their business elsewhere.”
The end result? Significant revenue benefits, she said. “When we model the business value associated with a better customer experience and increased loyalty, we find that it’s worth millions of dollars in additional revenue for many companies every single year,” Bodine said. “For businesses to realize these benefits, however, they need to get serious about the way they define, implement, and manage the customer experience.”
As change-management operators, marketers play a significant role in this shift, she added. “Marketing communications of every shape and size set customers’ expectations about the types of interactions they’re going to have with a company. If those expectations aren't aligned with the company’s actual ability to deliver on them, customers’ perceptions will plummet and the business benefits will evaporate,” Bodine said.
New CMO Keywords
Michael Bruh (@Acronym_Media), President and COO at Acronym, delivered one of the final keynotes; he shared the keywords that were used during the CMO Exchange--consumer, change, content, digital, multichannel, social, evolution, shift, and integration--to make a point.
“Keywords equal customer. Keywords are a brands’ most important digital asset. It’s the only common denominator across all online and offline channels,” he said. “Tablets, smartphones, new interfaces, Pinterest, Google+, and the dozen innovative platforms being developed right this minute. . .are all part of the ever-changing search experience. While brands used to dive deep and prepare significant budgets for every channel and platform, this approach no longer scales. Consumers are now making their decisions in microseconds. It’s becoming increasingly important to shorten the path from your customers to your products.”
The best way to do that, Bruh added, “is to listen to the signals customers are sending you via their keyword interactions. Through understanding a customer’s keyword searches across all devices and platforms, the paths they take on your Web site, and the words that create responses, you understand the intent, motivations, and ambitions driving sales. All of this brings you closer to your customer, closer to a sale, and closer to revenue.”
The Last, Most Influential Word
Ted Wright (@fizz_womm) is CEO of Fizz, an innovative word-of-mouth-marketing (WOMM) agency. “In the ’50s radio moved markets. In the ’70s it was television. Now we’re in the ‘age of conversation,’” he said. “McKinsey reports that word-of-mouth recommendations are the primary driver in 20 to 50 percent of all purchasing decisions. No one is debating the effectiveness of WOMM anymore.”
As a result, the focus has shifted from why to how. Key to that is figuring out who a brand’s influencers are. “Influencers are those one in 10 who influence the purchasing decisions of those around them. We all engage in word-of-mouth, but there are those of us who do so more than others,” he said. “Influencers have 40 percent more conversations than the average person, and twice as many are related to a branded product or service. The Keller Fay Group has consistently found that 90 percent of these conversations happen offline, and 75 percent are occurring face-to-face.”
Influencers share three personality traits, Wright said: “They like to try new things because they’re new, they share stories with their friends, and they are intrinsically motivated. This means they overindex on the satisfaction they get from making good recommendations to their peers. So the stories and recommendations they share will always be interesting, relevant to their audience, and authentic to the way the consumer understands the brand,” he said. “Seth Godin wasn’t exaggerating when he said that all marketers should be storytellers. Finding the sharable aspects of your brand’s story and the right people to get the message out is the key.”
Ben Arnon, Kerry Bodine, Michael Bruh, Steven Bushong, Vince Ferraro, Lorena Harris, Tim Moran, Greg Stuart, Tim Suther, Kimberly A. Whitler, Matt Wise, Filip Wouters, Ted Wright.