CMO roundtable: How to stop optimising channels and focus on the customer opportunity

Marketing leaders from organisations such as Sheike, Officeworks, CBA, ANZ, AGL and more share the challenges of becoming a customer-led marketing team and organisation and the role data, technology, customer insights and culture play in achieving it

The increasingly fragmented digital and media landscape, rise of connected devices, and desire for omni-channel retail experiences have left brands scrambling to meet the highly individualised expectations of their customers.

What’s become clear is that no one linear path leads to a brand or purchasing decisions. Yet while there are moves across most Australian organisations to become more customer-led, many marketers are still struggling to make that a reality in the way they approach marketing activities.

Shifting from a focus on channel-based campaigning towards a strategy that’s anchored in the customer opportunity and can take advantage of in a real-time moment of interaction is a must. How to achieve this was the subject of a two-part roundtable series CMO recently held in Sydney and Melbourne in partnership with ADMA and sponsor, Alterian.

Check out pictorial highlights from our Sydney and Melbourne roundtables online too.

What’s preventing customer-led marketing

So what is hindering marketers from being able to create and then optimise activities around customer expectations? At AGL, the single greatest challenge is bringing together the desire for investment into technology, with the right tech capability and the data to make it work, its marketing chief, Caroline Ruddick, said.

AGL has embarked on a $300m transformation program over three years that will see investment into core technologies, processes and people to digitise services and enhance customer experience. The program is about enabling a platform transformation that supports personalisation through data-driven decision making, Ruddick said.

“There is a rapid evolution of technology capability and it’s not easy to achieve successful implementation with legacy systems, and to access and leverage the right data to enable a clear customer view,” she said. “If you can deliver these elements, you are in a position to deliver a customer experience that will meet and hopefully exceed customers’ expectations.”

Legacy systems and managing the change cycle as new systems and processes are introduced is also a hurdle for Sheike & Co, its marketing manager, Morgan Jenkins, said. The fashion retailer is similarly going through a digital transformation project, which recognises the need for technology investment as a backbone for introducing the business to new ways of working and customer engagement styles off the back of that, she said.

“We’re in the process of updating all legacy systems to get to the euphoric state of a ‘single customer view’ in order to be able to deliver a service they expect and demand from us,” Jenkins said, adding that it’s important to “know the difference between having a single view of the customer and having all data in a single place”.

“We have also changed our approach to targeting, by removing customers from traditional demographic ‘boxes’ and instead looking to understand them on an emotional level,” Morgan said. To do this, Sheike is working on a fresh segmentation model, increasing its use of qualitative information to build out segments.

At the same time, while the ambition is there to be more customer led, Jenkins pointed out marketers need to keep running with standard campaigns, making slight improvements until the technology or solutions internally can support the new approach.

“There is an intent for change, and support for change,” Jenkins said. “The element that’s still to be defined is the education and understanding the art of the possible once we’re there.”

Carsales CMO, Kellie Cordner, said activating customer data is an ongoing challenge.

"Bringing together 20+ years of disparate data and legacy systems takes time.However, by taking an iterative approach with our analytics team on this journey, we’ve been able to realise value from priority audience segments along the way rather than waiting for the perfect solution," she said.

Alterian APAC vice-president, Vinnie Mistry, saw legacy tech as a common issue across organisations locally and globally. The problem is that technology is often channel-based, limiting the data that can be used for interactions outside of that channel.

“Because of this, personalisation is affected, since it is optimised by channel not by opportunity,” he said. “We also see a challenge with the current technology in place. With 3700 martech vendors today, companies have access to a selection of technologies to perform marketing.

“Also, brands often aren’t solving customer experience problems, but optimising the channel without thinking where the customer is on the path to purchase.”

For ADMA CEO, Jodie Sangster, the overarching problem is that businesses are structured to deliver against products, not to deliver to the customer.

“For this reason, it is not just marketing that needs to change in order for an organisation to be customer-centric, but the whole organisation from the top down,” she said. “CEO buy-in has come up frequently as an issue and is probably central. The CEO needs to empower the team to deliver to the customer and create key roles that are responsible for delivering to the customer experience – and are KPI’d on this, something that’s often lacking.

“Also essential is for the CEO to support the strategy and stay true to the cause, as it can be a long journey. You also need make the required investments to enable deliver to the customer.

“Legacy systems, lack of data, lack of skills and so on can all be solved when there is true buy-in, commitment and investment from the top.”

Building the foundations

From a marketing perspective, Officeworks has been undergoing a big shift in both processes and skillsets to enable teams to move towards a more customer-led approach, national CRM and digital marketing manager, Teresa Sperti, said.

“We have introduced lean and agile ways of working to allow us to bring ideas to market quicker and then feed learnings into an optimisation approach,” she said. “Our data-driven approach is unpinned by key technologies, like marketing automation, and we have evolved roles in our structure, including a platform’s SME, to ensure the team are enabled to get the best results out of the investment we are making in technology solutions.”

At ANZ, a renewed focus and energy around customer experience is illustrated through its new MD, whose accountability and title includes customer experience and who is tasked with putting a customer lens across everything the banking group does. The ambition is to shift discussions away from which customer may suit which service or product, to which service or product is best for a particular customer and their needs.

Supporting this is work on understanding what the real customer need is, and how the customer goes about their consideration of meeting that need. This is vastly different from an approach that’s based on what product the bank sells the customer when they arrive in one of its channels. But it’s not an easy journey, with historical org structures and revenue focus adding complexity.

As an example of how MetLife is striving to be more customer-led, head of marketing, Paul Bennett, said his team looks to find people in different life stages and connect to their motivations for insurance, rather than simply pitch a product.

“Then it’s about championing that experience, not the policy itself – the customer experience is about solving from a customer’s point of view,” he said. “To do this, you need to access that emotional need.”

Sangster’s first step is also getting a gauge on the customer’s expectations. She claimed too many companies are diving directly into an experience project without understanding what customers truly require and how their organisation can deliver on that need.

“Trying your own customer experience is the first step to improving a marketer’s ability to be more customer-led – but it’s amazing how many organisations/ marketers skip this step,” she commented.

Test and learn was raised by a number of attendees as a critical component in achieving these ends. Sangster advocated starting small, testing the concept, and making sure it’s actually delivering an enhanced customer experience before larger-scale investment.

“This prevents budget from being chewed up on projects that aren’t delivering to the customer’s needs,” she added.

The role of data

None of this is going to work without some handle on data, however. According to Mistry, making customer-led marketing a reality requires an ability to quickly assimilate the view of the customer with relevant data.

“This is critical and vital as a foundation layer. It allows the marketer to make key decisions, start building customer profiles and begin marketing to customers,” he said. “After that, marketers need to analyse the data to then be able to optimise and make informed decisions on marketing campaigns. This truly empowers the marketer to act.”

At Commonwealth Bank, the shift to customer-led marketing is absolutely reliant on data, and its executive manager of consumer marketing, Anna Bay, said significant investment has gone into getting data in order to better execute against the customer opportunity.

“The data journey starts around a vision of what we want to achieve and goes hand-in-hand with essential governance and critical rigour. That then feeds into the technology stack,” she said.

The ability to bring together ‘in the moment’ data, or ‘fast data’, and ‘slow data’, or data collected historically, such as CRM data, is where the rubber really hits the road, Mistry continued.

“A current Alterian utility client in Europe has seen 25 per cent uplift in customer retention only by reacting to the complaint in the channel of their choice, which arose from a bill increase they hadn’t expected,” he explained. “Simply by listening to the customer, this utility company was able to react in real time and notice a considerable difference.”

At Carsales, the focus has been on the ability to aggregate and extract insights from both areas.Cordner said from a data point of view, the business is working towards a single point of truth and single view of our customers.

"This has seen us invest heavily in our analytics capability over the last 12 months, both from a skills and technology perspective," she said. "We’ve also implemented a marketing automation platform to enable us to trigger real time opportunities derived from this data."

Alongside owned data assets, Mistry saw data sharing and the use of third-party sources as powerful weapons for the marketer. “It is a way to access information otherwise unavailable to them to create targeted campaigns,” he said. “This is still work in progress and with time, we will start to see companies commercialise their data via these data platforms.”

Sangster has also seen data partnerships gaining ground across organisations as they look to enhance customer knowledge.

“This is because they can’t just view the customer through their own lens but also need to have a broader perspective of customers’ behaviours and preferences,” she said. “Real care has to be taken here and brands need to ensure they don’t step outside of the reasonable expectations of their customers. Brands do not want to extend beyond a consumer’s level of comfort.”

Up next: How marketers are making sense of the customer journey

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Making sense of the customer journey

Ultimately, what lies at the heart of building a personalised experience is understanding the customer and lifecycle journey they take with your brand.

“Marketing, and our business more broadly, has a focus on deep understanding of the customer and their needs, understanding their journeys through touch points with our products and services, and where they hit ‘pain points’ that require too much effort for the ‘reward’ they get,” Ruddick said. “We also invest in time spent with customers to know and understand their point of view.”

Increasingly, organisations have looked to plot out this customer journey through customer journey mapping, and several attendees cited this as an active exercise in their organisations today. But Mistry warned against relying too much on static customer journey mapping as the key to understanding a customer’s needs, especially at a particular point in time.

“In practice, it is impossible to predict the customer journey,” he said. “Does that mean that the customer journey is no longer relevant? No. The fact is, customers are now controlling their own journey and the marketer needs to adapt to the customer.”

Mistry advocated creating a “customer state”, where the opportunity is with the customer at that point in time, then reacting to that state in each channel. “It’s the ability to know what their last interaction was to then personalise that interaction,” he said.

Sangster claimed building out customer journeys has gotten to a stage where the ‘journeys’ are the new rigid. “True personalisation takes it a step further and develops the experience based on continual reviewing of data insights,” she said.

In addition, many attendees believed too much emphasis was on attaining a single view of the customer, rather than having the right view of the customer or a view that’s adequate enough for marketing to action off.

“Leveraging a single customer view is often dangerous in that it can lead you to create solutions to then find a problem, and solutions that can please you as an organisation - in other words, you get technology to push product out the building rather than find a particular customer need and address that,” MetLife’s Bennett warned.

“Every interaction the customer has with us needs to have a different set of data about the customer to efficiently support the customer interaction, and it needs to be complete from all the places that the customer has shared data with us,” another attendee from a financial institution said. “But it does not need to start off as an idea that there is ‘one view to rule them all’. Over time, we may end up with a single view of the single customer, but that isn’t the way I’d frame the problem.”

The same attendee also claimed ‘real-time’ was further confusing the picture, and called for a focus on ‘response time’ instead.

“Sometimes, the response time requirement is immediate – so real time – but sometimes it is about a little reflection, and being aware of customer’s needs, relevance to them and their readiness to engage. For example, if a customer says they are planning to do something in six months’ time, the right time to respond may be in around five months.

“Regardless of real time or responsive time, I think it is important to always make sure the organisation has a memory about what previous interactions have been, and ensure you don’t look like you have the memory and attention span of a goldfish.”

Collaboration is critical

While marketing might be leading the way when it comes to being customer champion, it was clear through roundtable discussions that marketing cannot make their organisation adopt a more customer-led approach alone. What’s therefore imperative is to collaborate across the business.

“A truly customer-centric business will come from one that is entirely cohesive,” Jenkins said. “We must all be working to the same goal of delivering to customers’ needs and wants.”

Officeworks’ Sperti also believes a customer-led approach requires cross-functional engagement and collaboration. She saw strong relationships between IT and marketing as particularly crucial.

“This allows for a strong data and technology foundation to be established, enabling personalisation and providing an orchestrated cross-channel experience for the end customer,” she said. “At Officeworks, we are fortunate to have a highly engaged IT team that understands where we are heading and works collaboratively with our marketing team to support a customer-led approach.”

One suggestion CBA’s Bay had for getting the business onside was to connect the customer story with what the organisation cares about and show how improve customer contact enables that.

“For example, telling stories from our frontline teams – how for them it’s better, faster, making a real difference in the customer’s life and to their long-term financial well-being,” she said.

It’s also important to continually involve everyone on the journey, Bay said, adding this is again where sharing customer stories has had a particularly strong impact at CBA.

“We balance these customer focused outcomes with the success of an improved bottom line,” she said. “Having the data assets and analytics helps to bring these to light.”

Another attendee from an insurance group said his organisation instituted multiple cultural programs to ensure all staff put the customer at the forefront of thinking.

“We also listen to customer calls on a regular basis, as well as proactively seeking out feedback from the frontline teams,” the attendee said. “However, the most important strategy has been to interact with them more frequently to play an active role in providing value in their everyday life, rather than just sending transactional communications. This includes providing content, utility and solutions for their everyday living.”

Carsales created a Voice of Customer function 12-18 months ago, which Cordner said not only listens and responds to customers, but also share this front line feedback with all layers of the business.

As another measure of experience, particularly from a product touch point perspective, Carsales has embedded NPS and CSAT feedback across customer journeys.

"Collecting not just the what but the why has been invaluable in highlighting optimisation opportunities at product level," Cordner said.

Metrics matter

Another way brands are looking to make the change is by adopting specific metrics/KPIs that foster a more customer-focused approach. AGL, for example, is using both NPS and Customer Satisfaction in different parts of the organisation.

“Both of these measures drive a good focus on customer outcomes,” Ruddick said. “In most organisations, there is a debate on whether NPS or CSAT should be the customer metric of choice. Interestingly, there is a correlation between CSAT and NPS; if one improves, the other usually does as well.”

Ruddick also cited growing adoption across sectors of Customer Effort as a metric. “There are types of interactions where a customer may not necessarily be satisfied as a result of the interaction – such as paying for tolls on a freeway,” she said. “If it takes less effort for a customer to have the interaction as services improve, NPS goes up.”

Mistry advised establishing metrics around the customer and their movements. These could include measuring average orders, frequency of that order, and monetary value, through to customer lifetime value and NPS scores.

“Marketers should not focus on open and click rates because these won’t tell them how they are influencing company objectives,” he said.

Ultimately, the role of marketers is to deliver results to the bottom line and that needs to be taken into consideration whatever metrics are in play, Sangster said. “We have seen a shift away from ROI to new broader measures – with a huge focus on engagement. This needs to be kept in check so that we don’t lose focus on the reason why customer centricity is important,” she said.

“The reason for delivering to customers’ expectation/needs it so that they will be a more loyal/ active/ valuable customer for the brand – and so they will stay with you and not go to the competitor. So ultimately, the success should show in your bottom-line results.”

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