Why customers need a seat at the boardroom table

Jodie Sangster

Jodie Sangster has been the CEO of the Association for Data-driven Marketing and Advertising (ADMA) since 2011 and is also chairperson for the International Federation of Direct Marketing Associations (IFDMA). She has worked across the US, Europe and Asia-Pacific for 14 years with a focus on data-driven marketing and privacy, and began her career as a lawyer in London specialising in data protection. Her resume includes senior positions at Acxiom Asia-Pacific and the Direct Marketing Association in New York.

The idea that the customer needs to be represented at board level isn’t a new concept. The chief customer officer began to appear in forward thinking corporations around the turn of the century as the (then) nascent digital world began to open up consumer choice and traditional methods of cultivating brand loyalty started to be challenged.

Fast forward a decade or so, and the balance in power between companies and their customers has significantly pivoted. Today, customers are equipped with more information and choice than ever before. We live in an age where brand loyalty is becoming a thing of the past and social media acts as a turbo-charged village square to pass on immediate good and bad feedback on products and services. The power is firmly in the consumer’s hands.

Much has been written about the disruptive effects of companies like Uber, Airbnb and Amazon on traditional businesses. But the disruption goes way beyond their respective industry sectors. These companies have irrevocably shifted expectations on what good customer experience looks like.

Consumers now expect interactions with a brand to be frictionless, whether they are accessing that service or product via desktop, tablet, mobile or in-store. They expect immediate resolution of problems, give immediate feedback and, increasingly, expect the product or service to be available on whatever platform that they choose.

None of this should come as a surprise to organisations. Customer centricity is one of the buzzwords of 2016 and consequently an increasing number of companies have recognised that they need to prioritise the consumer experience.

However, it is my belief that there is much more talk about customer experience than actual business-shifting activity and that, to date, the role of the chief customer officer has been disproportionately focused on the marketing experience.

Of course, data-driven marketing is an important element of a customer centricity. Marketing now has to be about personalised engagement and storytelling – listening to customers, creating and maintaining trust and designing relevant experiences and communications for them.

But in order to have a truly consumer-centric organisation, the whole of business needs to be aligned towards putting the customer first. And there are three key steps in making this happen.

Build a customer-centric mentality

First of all, this means that the vision and mission of organisations need to be realigned so the customer is placed at the centre. This can mean a wholesale structural re-organisation and it will almost certainly require a genuine shift in thinking around how to value the customer lifecycle across all areas of the business. Fundamentally, it is about creating financial value by putting the needs of the customer front and centre; aligning marketing with product, innovation, technology and business strategy.

Get KPIs in order

Along with a realignment, KPIs also need to be reworked to ensure they are customer focused so all teams are rewarded for their part in delivering the optimal customer experience. Having revenue as a sole KPI will never drive an organisation to put the customer first.

Secondly, the customer needs representation at the boardroom table. This includes not only having a customer champion representing the consumer’s viewpoint, but also having appropriate metrics and measures as part of the Board agenda. This enables a business truly understands the customer’s sentiment and needs in a transparent feedback loop.

Enact change from the bottom up

Thirdly, and importantly, in order to be truly effective, a chief customer officer has to be given a genuine mandate to change business practices from the bottom up. They can’t exist to pay mere lip service to the customer or to be a tick in the box for the advisory board.

In a recent presentation by a large US bank, the chief customer officer voiced her frustration about not being able to make ‘genuine change’ in her organisation. Despite being tasked to deliver exceptional customer experience, her challenge was that she was positioned in the marketing team – and therefore her sphere of influence started and ended in marketing.

As she rightly pointed out, customer experience extends far beyond marketing. Without the ability to influence departments such as product, IT, finance and operations, delivering customer experience is almost impossible.

I’m not glossing over how difficult it can be to become a truly customer-centric organisation. The changes I’ve described above are significant. And naturally, there will always be times when what is right for the business is not in the best interests of the customer. This is when the hard choices need to be made.

Although we must accept that not every business decision can be made in favour of the customer, it is essential that the customer view point is properly understood and considered when those hard decisions need to be made.

At the ADMA Global Forum recently, Tom Goodwin, SVP of Strategy and Media Havas US, outlined some examples of what he called ‘digital garnish’ – that is, companies that had introduced some experimental digital initiatives while their core business operations were not serving their customers optimally.

He gave the example of Ikea introducing VR to browse furniture while its website continues to have a poor user experience, along with Hertz, which has invested in location video call facilities but provides a less than optimal online booking process that often results in abandoned transactions.

So to misapproriate Tom’s phrase, the chief customer officer can’t just be responsible for ‘customer garnish.’

Truly customer-centric organisations know this. Their chief customer officers sit on the Board of Directors in order to put the customer front and centre. They act as a de facto chief of staff for the CEO when it comes to putting the customer first. And they disseminate, interpret and champion customer insights across the breadth and depth of the organisation so cross functional teams can agilely respond to changing dynamics.

Don’t just add garnish; put in the work to become genuinely consumer centric.

Tags: data-driven marketing

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