In conjunction with IBM’s Smarter Commerce initiative, the SMB Group and CRM Essentials are working on a series of posts discussing how technology is empowering today’s customer, and why companies have to change their approach in order to build strong relationships with them. This is the sixth post in the series.
Very few marketers would deny that marketing is in the midst of a sea change. As we’ve been discussing throughout this series, many businesses are struggling to keep up in our increasingly connected world. This rise of social media, a growing avalanche of data, and 24/7 access to new channels and devices that customers can use to learn about, shop for and buy goods and services is radically and irreversibly changing the world of marketing and commerce.
Given this reality, the central question is whether your business is preparing to ride the new wave–or is in danger of getting caught up in the turbulent undertow? In other words, to quote former GE CEO Jack Welch, are you ready to “change before you have to”? And, just how feasible is it for a small or midsize business to get ahead of the curve?
IBM’s 2011 IBM CMO study, From Stretched to Strengthened, took an in-depth look at how 1,734 Chief Marketing Officers (CMOs) (including a sample of midsize companies) are thinking about and dealing with these mega-changes. It’s interesting to look at these results, and how one of the midsize companies that we spoke with recently is navigating through this transformation.
Top Market Forces and CMO Concerns and Readiness to Address Them
CMO study respondents of midsize companies are struggling with four major market forces: decreasing brand loyalty, the explosion of data, proliferation of channels and devices, and social media.
Unfortunately, change is difficult–and most CMOs feel ill-equipped to address these new requirements, as shown in Figure 1.
Figure 1: Percent of CMOs Reporting Underpreparedness
To me, this level of concern isn’t surprising. Social and technology changes are escalating at a breakneck pace, in an increasingly volatile world. Wrapping your head–let alone a marketing organization–around these rapid, often unpredictable changes isn’t for the faint of heart.
Charting a Course for Change
The good news is that the vast majority of CMOs see three key areas that they need to take action in to address theses challenges by:
- Delivering value to empowered customers
- Fostering lasting connections
- Capturing value and measuring results
What does this really mean? Customers have always wanted companies to listen to them and to act on the input they provide. They’ve always wanted companies to value their time and their recommendations as well as their money. But today, technology gives customers better, faster access to information, people, products and services–giving them more control over the commerce process and enabling them to wield more influence with other buyers.
Customers increasingly expect anywhere, anytime, any-device access to information throughout the commerce cycle–from information gathering, evaluation and selection, to purchase and service. They expect vendors to do a better job of meeting–or even of anticipating–their needs. This means that vendors need to understand not only “the market” but individual customer requirements and preferences, and deliver solutions to attract, interact with, acquire and retain customers on a much more personal level.
In the digital age, this means that CMOs must develop automated processes to tap into multiple channels and customer touch points. And they need new analytics capabilities to gauge and tune marketing and commerce initiatives in an actionable way at a one-on-one level.
In a nutshell, CMOs and marketing organizations need to radically reinvent marketing with automated digital and analytical processes that help them to deliver more value to customers.
Taking a Proactive Approach
IBM’s study also revealed that CMOs in outperforming companies are more proactive than their peers in tackling these issues. These CMOs are investing now to better understand individual customers as well as markets, and using analytics to help them do a better job of zero in on customers’ needs to deliver a better experience and build customer loyalty.
For instance, CustomInk, a 300-employee custom t-shirt company, uses IBM Software for Enterprise Marketing Management, specifically IBM Coremetrics, to improve the customer experience and grow the business. CustomInk relies on a Coremetrics dashboard to monitor daily key performance indicators (KPIs), such as: What percentage of site visitors go to its Design Lab? How likely is a visitor to save a design? How do aesthetic changes improve conversion rates? CustomInk uses these metrics to determine what’s working and what isn’t. For example, if the percentage of customers who save a design is low, it may be because something is broken and the customer can’t load the design. Or there may be an overload of visitors from unqualified sources.
IBM software also provides CustomInk with the ability to monitor key paths through its site on a daily basis. This enables CustomInk to determine where people “fall off” on different paths. The company can see when changes it makes are beneficial, detrimental or neutral to customer behavior. For example, CustomInk has learned that small, aesthetic changes in color or type font, or changes in button styles or colors, can impact movement through the site and affect the drop-off rate.
CustomInk drives home the point that a company doesn’t have to be part of the Fortune 500 to ride the waves that these social and technological changes are ushering in. In fact, because SMBs can often act in a more agile and nimble fashion than large companies, they may actually have an advantage over larger companies.
However, any business must start by making a conscious decision to transform their marketing team for this customer-centric world, and develop a strategy that revolves around customer engagement and interactions. Some key questions to get started include:
- How can the business use customer interactions to better anticipate and respond to requirements, and improve the customer experience?
- What are the different customer and prospect touch points in your organization, and how can they be strengthened?
- Do we know where customers and prospects are talking about your products and services, competitive brands and related industry trends?
- How do we best bring customer conversations into the company to help us better serve their needs?
- How will we measure and analyze the results of what we’re doing?
- How can we make the information and insights we get actionable?
- What skills and solutions will we need to achieve our goals?
While each company will have different goals, metrics and requirements, one thing is crystal clear: the art and the science of marketing is undergoing a radical change. CMOs and marketing organizations need to take a proactive approach to use them to their advantage.
This is the sixth in a series of blogs by SMB Group and CRM Essentials that examines the evolution of the smarter customer and smarter commerce, and IBM’s Smarter Commerce solutions. For more information about CMO perspectives on several issues, see the full results of IBM’s 2011 IBM CMO study, From Stretched to Strengthened.