Wednesday, April 16, 2014

Measuring Sales and Marketing based on Customer Outcomes

Have you ever used Uber X, the freelance taxi service? Half the cost of a cab and twice the level of service. The cars are immaculate. The drivers are almost overwhelmingly nice. They care deeply about your experience. Not because they want a tip. They want your 5-star feedback. That's so important to their success that they will do almost anything to make sure you are happy. It is a customer first model that works because customers have the ability to give feedback that has direct business impact. It's the eBay model applied to real world human interaction.

Think of your salespeople as Uber drivers, they interact with customers every day. Your marketing is like the car - is it in the right place at the right time and taking the customer where they want to go? These things matter tremendously to customers and yet we have no means to empower them to drive the behavior of marketing and sales at the moment of engagement. We have customer satisfaction surveys. They are important but lack immediacy and context for sales and marketing.

I recently came across two articles that may be the proverbial starting gun for measuring customer focus. The first from the HBR blog, "Bonuses Should be Based on Customer Value not Sales Targets," profiles how GlaxoSmithKline no longer calculates sales bonuses based on prescription drug sales but on a basket of metrics related to patient outcomes. The second on the Forbes blog, "The 5-Star Employee, Why we need a Yelp for Business" presents a provocative picture of why employee ratings should be standard practice.

Clearly there are cultural and generational issues at stake and a lot of education needed to make these transformations acceptable and actionable in a way that improves outcomes for everyone. As customer facing technology coalesces around the CX Cloud model, marketers should think about how to get customer feedback more frequently. It will require innovation born of experimentation. Of course, no one wants to rate every piece of collateral. But maybe every third touch or at specific points in the nurturing process. Companies that figure it out will have the great advantage of being able to monitor customer experience and course correct in flight as opposed to relying on satisfaction surveys that are too little too late. Best of all, customers will feel the power of the relationship, something they won't get from traditional models. Uber X is not better just because it costs less, it delivers more at the same time.

Tuesday, March 18, 2014

The Customer: The Most Important Statistic in Marketing – Everything Else is Just Offensive Rebounds


Let's start with a story that relates to marketing today. When my brother in-law was trying out for his high school basketball team, the coach sat all the players down at the end of one practice and asked them, "What is the most important statistic in all of basketball." My brother in-law, quite confident his answer would be correct, raised his hand and answered "Points scored." The coach stared at him for a few seconds and responded, "No. Offensive rebounds." For those of you who are familiar with basketball, you know that is a ridiculous statement – while offensive rebounds are important, the final score determines the winner, and thus is inarguably, the most important statistic in basketball.

For marketing, the customer is the final score


Today in marketing we are in an exciting phase with so much change happening, but also so much opportunity. The current atmosphere is a scary proposition for some, yet energizing for others. This energy has brought enthusiasm to many areas within marketing that are touted as "the most important." While areas like marketing technology, big data and analytics, and content marketing are INCREDIBLY important, ultimately, they are only a portion of marketing and not the full picture. In the end the most important "statistic" is the customer. The buyer ultimately judges and scores you, so remember, how well you provide value to your customer will determine whether you win or lose.




Highlighting this customer focus, in our 11th annual marketing barometer survey we asked over 75 senior level marketing executives to "compose a tweet on the future of marketing." We then took those answers and created a word cloud (see above). Low and behold, the two largest words that came up were "Customer" and "Buyer". These executives, whether intentional or not, understand that the customer/buyer will determine the final score. So remember, while different marketing practices may have incredibly important functions, in the overall game of business, they are all just offensive rebounds. 

Follow Sam Melnick on Twitter @SamMelnick


Monday, March 10, 2014

The one framework your CMO must share with your CIO

So many marketing solutions are available that it is very difficult for marketers, chief digital officers, and CIOs to have a holistic view of what they have, what they need and why. IDC has recently created a tool to help - The 2014 Strategic Framework for Marketing Technology. This tool provides a visualization of the different technologies needed to support different marketing organizations no matter how small or large, digital or non digital, modern or not. Pictured below is the whole map which presents solutions in four broad categories:
  1. Interaction: The primary function of these solutions is to be customer facing
  2. Content:  The primary function of these solutions is to facilitate the production and management of marketing content
  3. Data and Analytics: The primary function of these solutions is to store and produce insights from customer, operations, and financial data
  4. Management and Administration: The primary function of these solutions is to provide internal communications, workflows, budgeting and expense tracking.
IDC's Strategic Framework for Marketing Technology
v1.0 = 78 categories 

We have found that the complexity of technology requirements can be defined around a few factors:
  • Company size
  • Business model (eComm, B2C, B2B direct, B2B indirect)
  • Vertical industry
  • Mission of marketing (awareness, demand generation, etc.)
Using these factors, the map can be easily customized to show the current state, recommended next steps, and long term vision for just about any marketing organization. If you're a pure eCommerce company the advertising and digital commerce areas will be much more important and sales enablement would disappear. If you're a B2B direct company digital commerce might be a very low priority and sales enablement would loom large in your plans. Regardless of whether you're CPG, Health Care, Financial Services, startup or global enterprise, we can build a map to get your marketing, IT, and executive teams on the same page with respect to your marketing technology requirements.

For more information on our framework and the services we offer around it, please contact me at gmurray (at) idc (dot) com. 

Thursday, February 13, 2014

Top 3 customer experience challenges for marketers

Customer experience management is fundamentally about providing a seamless and consistent flow as prospects move through different phases of development and points of contact with a supplier. Delivering on this presumes a level of connectedness that many marketing organizations struggle to achieve. The reason for the struggle is that there are three significant forces of fragmentation opposing their efforts: specialization of roles, organizational hierarchies, and tactical technology. These forces threaten every marketing organization with two fatal flaws: they slow everything down and fracture the customer experience.

Three forces of fragmentation that marketers must fight:
1.     Specialization: all areas of marketing execution have become inch wide mile deep endeavors. As a result, there can be many degrees of separation between key roles such as social marketers, event planners, web administrators, technical writers, etc. What do these people talk about when they get in a room together? Does anyone else care how the events person manages food service or logistics?

How to combat the fragmentation of specialization: It is becoming clear that the one thing all marketing roles now have in common is the need to master data and analytics. Each specialized role produces and consumes data from all the others. It is critical that everyone in marketing understand how customer and operational data flows, how others use the data they produce, and the best analytical practices for gaining insight. This should be a key topic of conversation and community building.

2.     Hierarchical org charts: Marketing is no longer a command and control world. Yes, there is an overlay of reporting that has to go "up the chain." For many marketing leaders that grew up with the traditional B-school approach to management, adding layers to the org chart is a natural approach. However it results in compartmentalization that left untended creates a culture of disconnectedness.

How to combat the fragmentation of hierarchies: Marketing organizations should be defined around processes not activities. Marketing processes must be supported by collaborative environments that foster greater visibility and coordination between contributors. Enterprise social networks are becoming essential for creating a culture of openness and connection. Organic approaches are not enough, marketing leaders need to seed the social network with process oriented communities such as: campaign management, sales enablement, content lifecycle management, etc.

Transforming Marketing From Silos...

... To Systems


3.    Technology: IDC identifies nearly 90 different categories of marketing technology (not including middleware and infrastructure!) That alone should tell you the function and the IT market serving it are unsustainably fragmented. The deployment of highly specialized tools can empower people within their specialties but can leave them on a technology island in the greater scheme of things. Major IT vendors have started to consolidate some of the basic building blocks, but there are still many areas in which niche/best of breed capabilities are needed.

How to combat the fragmentation of technology: The two centers of gravity for your marketing IT infrastructure are your integrated marketing management solution and your website. They should be intimately tied to each other and all other marketing systems/tools should integrate with one or both of them. This becomes a forcing factor for integrating processes and data flows. Marketers also need to demand more of their technology vendors to accelerate the evolution of platforms that tie together the systems of engagement, content, administration and data.

The most successful CMOs will ensure the pervasive deployment and adoption of technology increases collaboration, socialization, and systems thinking. They will design marketing organizations around customer-centric processes and exert deliberate efforts at all levels to combat the forces that threaten the connectedness needed to serve up a seamless customer experience. 

Wednesday, February 12, 2014

80% of Your Customer Data Will be Wasted

Larger and richer collections of customer data are increasing available. That’s the good news. But most of that data is wasted. That's the bad news. Poor data practices remain one of the biggest hurdles to marketing success.

Here are four ways that companies squander data and recommendations about how to stop the waste:

Data is Missing: A huge amount of customer data is available but is just not collected. Your ultimate goal should be to capture interaction and behavioral data at every touch point.
 
What to do: Acquire the data. Invest in marketing technology and services that capture data and in data management technology to store it for analysis. IDC finds that tech marketing leaders invest more than three times the amount of funds in marketing technology than their laggard cousins.  Big data is the marketer's friend.  Providing lots of data to your analysts will enable them to predict the next best offer, discern buyer preferences, determine marketing program attribution, improve conversion rates, and much more.

Data is Unavailable: Some customer data is captured in company systems, but is trapped where marketing can't access it. Marketing needs information on customers from a broad array of sources from both inside and outside the enterprise. Sales data, purchasing data, and customer service data, are examples of internally available data critical to seeing the full customer picture.

What to do: Aggregate the data. C-Suite executives must rush to the aid of marketing if they want to get full value from the function. To stop measurement at the MQL or even sales "closed loop" is insufficient for the full customer picture. Pay particular attention to converting unstructured data into structured data so it can help drive the content customization and delivery process.



Data is Junk: Sometimes customer data is captured, but is meaningless.

What to do: Analyze the data. You must be able to separate the signal from the noise. The first step is to gain a baseline understanding of the journeys taken by your best customers.  This point of view will give you a filter. CMOs need to invest in the tools and skills needed to gain insight from the data and tell a relevant business story.

Data is Late: Some meaningful data is captured, aggregated, analyzed – but the whole process takes too long for any relevant action to occur.

What to do: Act on the data. The point of data investment is to develop a rich understanding of the customer's context so the most relevant response (typically content) can be delivered to them. In a digital dialog, a response is expected on the other side of every click.  Data needs to be made readily available to decision engines and content management systems so that they can take action.

Monday, January 20, 2014

Tech Marketer's Top Priorities for 2014 - Call for Participation IDC's Tech Marketing Barometer Survey

IDC's CMO Advisory Service is conducting our 11th annual barometer survey. Consider this blog post the official call for participants (get pumped!)

Ok let's cut to the chase:

What are the benefits:
  • Complimentary copy (value of $4,500, yea the font is green for a reason) of our 2014 Tech Marketing Barometer Report. This will answer key questions around up and coming marketing areas (digital, content, marketing tech) and budget direction throughout the entire tech industry. 
  • Receive an invitation to a future client only telebriefing with key data from this survey
Who Should Participate: Marketing executives who are in a position of responsibility for worldwide marketing practices.

How Long Should it Take: Depending on several factors, as quick as 15 minutes!

What's the Deadline: Tuesday, Feb 25, 2014.... But wait, there's more - All surveys received by Monday, Feb 17, the participant will be entered into a raffle for a $200 Amazon Gift Card!

There's No Link...How do I Participate: To assure the highest data quality we carefully screen our participants. Please email Sam Melnick for the survey link.

Confidentiality: This goes without saying. All answers will be kept confidential by IDC and all data will be aggregated for the purposes of trend analysis.  Additionally, your responses will not be used for any other purpose within IDC.

For those that skipped to the end:

TL;DR: If you are a senior marketer interested in receiving complimentary research, email Sam Melnick for the survey link and complete it by Feb 25!

Thursday, January 9, 2014

Busting the Myth of Sales Disintermediation

Are IT Buyers so self sufficient that sales people will no longer be needed? Much was made in 2013 of the notion that IT Buyers make a large percent of their decision before engaging with sales. Every major market research company had its own number but they all ranged north of 50%, a scary thought especially if it represented a rising trend.

As shown in the figure below, enterprise IT buyers actually rely very heavily on vendor input for enterprise solutions. Buyers can make categorical decisions like "we need a new CRM or billing system." But they need a great deal of information from marketing, sales and technical sales in order to complete their decision making processes.

Finding the Right Mix of Marketing and Sales Engagement

Q.        What percent of your decision for an enterprise-level purchase when multiple vendors are competing for your business has been made by the time you first speak with a salesperson?
Source: IDC's 2013 IT Buyer Experience Survey, n = 193

The implications for supporting customer journeys is significant. For purchases that are low cost, familiar and low risk customers want to be as self sufficient as possible. And sellers need them to be because it costs too much for even telesales or online chat to support these transactions. At the other end of the spectrum of course it gets far more complex and that translates into opportunity for vendors - if they are truly aligned with the buyer's journey

One of the most important value adds that most sales and marketing lacks is the need to educate customers on how to buy as much as what to buy. For costly complex purchases, customers need guidance on:
  1. How to evaluate the strategic priority of the solution as well as the technical and business benefits
  2. How to build consensus across line of business, corporate IT and other key players in the decision making process.


According to our latest IT Buyer Experience research, marketing and sales teams that provide this insight early and often will help buyers make their decisions up to 40% faster, putting them ahead of the competition and ahead of forecast.

For more information on this and related research please contact me at gmurray(at)idc(dot)com.