5 Disruptions to Marketing, Part 1: Digital Transformation (2018 Update)

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At the end of last year, Scott Brinker wrote a series on 5 disruptions to marketing. This is his article. Thank you Scott!

I wanted to look beyond the typical kind of prediction posts that we are inundated with at holiday season to scope out the larger changes underway over the next 3-5 years:

  1. Digital transformation redefines “marketing” beyond the marketing department.
  2. Microservices & APIs (and open source) form the fabric of marketing infrastructure.
  3. Vertical competition presents a greater strategic threat than horizontal competition.
  4. AR, MR, VR, IoT, wearables, conversational interfaces, etc. give us digital everything.
  5. Artificial intelligence multiplies the operational complexity of marketing & business.

Now that we’re one year along this journey, let’s revisit how those trends are progressing and consider what we’re likely to see with them in the year ahead. These aren’t “predictions,” but rather “updates” on the big multi-year themes that are reshaping marketing as we know it.

As with last year’s series, I’ll break this up into five parts for easier digestion.

1. DIGITAL TRANSFORMATION (2018 Update)

Total Customer Experience: Marketing + Sales + Customer Service + Product

The essence of digital transformation is that marketing, sales, service — and most of all — product are all being entwined together under the banner of “customer experience.”

Naturally, that makes sense from the customer’s point-of-view. How much delight or disgust do customers feel across the entire spectrum of engagements they have with your company, from the very first touchpoint onward?

Their whole end-to-end experience is the product.

The five things that make this transformational are:

  1. All of these touchpoints are either digital or digitally-supported.
  2. Orchestrating these touchpoints is inherently a cross-organizational mission.
  3. Marketing is increasingly at the center of that orchestration.
  4. Marketing is embedded in the product (and, vice versa, product in the marketing).
  5. The resulting end-to-end experience for customers is how smart companies are disrupting their competitors — e.g., Uber isn’t the car ride, it’s the whole seamless experience.

A report produced a couple of months ago by the CMO Council asked CMOs to identify one — and importantly, only one — top mandate that they had for the year ahead. As shown in the chart below, 67% reported a cross-organizational mandate on growth and/or customer experience.

Marketing's Top Mandate for 2018

Of course, it’s one thing to talk about customer experience, another to actually effect it.

But as Barry Levine wrote on MarTech Today a couple months ago, “At our most recent MarTech Conference, there seemed to be a transformation percolating throughout the sessions and presentations. After several false starts in previous years, it seemed to me that ‘marketing’ is now clearly becoming something bigger.”

In many ways, marketing is looking, sounding and feeling less like its traditional role of “demand generation” and more like “experience management.” — Barry Levine

Aetna: Customer Experience as Marketing

David Edelman, CMO of Aetna, emphasized in his keynote at MarTech how marketing was now deeply engaged in helping to shape customer experience — including pioneering mobile and wearable touchpoints that innovate the very nature of the relationship between the company and its customers.

Successful marketing-led customer experience projects and programs shared by other speakers at MarTech included:

  • Keurig Green Mountain, launching connected coffee machines that enable a whole new kind of digitally-augmented customer experience with their products
  • Staples, using marketing analytics to map and improve steps across the customer journey that spanned traditionally separate teams within the firm
  • Dr. Martens, implementing omni-channel personalization seamlessly across email, their e-commerce site, and social media in ways that genuinely amplified their brand

And that’s just a representative sample. The thing that they all have in common: marketing is being embedded into the product/service and the end-to-end customer experience.

Last year I wondered whether marketing would continue to rise to the challenge of this scope explosion — from communications to experiences. Over the past year, I’ve been excited to see so many marketing teams embrace this opportunity in the charge of digital transformation.

Marketing as Customer Experience

But there’s another aspect of digital transformation in marketing that I’ve noticed over the past year: the changes in what marketers were actually doing. Not just shifts in their mission — i.e., delivering delightful customer experience. But shifts in what they’re building with their hands and minds to achieve that mission.

Empowered by a plethora of marketing technologies that are widely accessible to and usable by non-technical, “generalist” marketers, ordinary citizens of the marketing department have increasingly become do-it-yourself wizards in crafting digital interactions with customers, digital workflows throughout their organizations — beyond marketing, into sales, service, finance, etc. — and dynamic data dashboards, models, and reports.

I use the phrase “citizens of the marketing department” quite intentionally, because these wizard-like capabilities that marketers are acquiring align with three big IT-democratization movements:

Citizen Developers on the Rise

  • CITIZEN DEVELOPERS — who use no-code or low-code tools to create web apps, mobile apps, interactive content, bots, and other kinds of functional experiences for staff, prospects, and customers
  • CITIZEN INTEGRATORS — who use iPaaS and other workflow automation tools to create business processes on-the-fly, intelligently routing data and triggering activities across multiple teams
  • CITIZEN ANALYSTS or even CITIZEN DATA SCIENTISTS — who easily pull together business intelligence data from a variety of sources on demand, analyze it, visualize it, tease out insights, and even automate decisions around it

That’s not to say that these “citizens” have eliminated the need for “experts” wholesale. There is still plenty of work that requires professional developers, systems integrators, and data scientists. But the scope of what individual marketers can build on their own is astounding — and unprecedented.

This is digital transformation in a company’s internal ecosystem. The kind of power that would have taken teams of experts and weeks of work to implement an idea even just 5 years ago is now in the hands of individual citizen marketers to instantiate almost immediately.

And as marketing technology continues to race forward, their power to create only grows.

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What do marketing orgs look like in the martech age? Let’s find out

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First, this is a copy of a blog post from Scott Brinker, who continues to provide invaluable strategic insights as a thought leader in the world of marketing technology. Thank you Scott!

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I know, you get asked to participate in a ton of surveys. You’re super busy, and most of the time, the results of these studies are of dubious value to your actual work. So it’s easy to pass on taking them.

But if you like the content of my blog, and have ever found it helpful, I’d personally ask you to participate in this survey: Marketing Organizations in the Age of Martech.

I also believe that the results of this one may be quite valuable to you.

The thesis of this study is that marketing technology is reshaping the organization of the marketing department. Directly, marketing technology and marketing operations have become prominent roles, with expanding teams of their own.

But indirectly, martech also changes the way the rest of marketing is able to function. Marketing can — if it develops the necessary organizational capital — orchestrate across channels, adapt to feedback in rapid fashion, leverage data from a myriad of sources, run experiments, trial new innovations, and more.

In this new environment, is marketing best served by organizing around activities, channels, products, customer segments, or stages of the buyer’s journey? Or some other structure? What capabilities does it centralize?

Having talked to many CMOs over the past few months, I’ve come to believe that there are some powerful new options for organizing modern marketing teams. I’d love for us as a community to get greater visibility into what those possibilities look like across a variety of real-world marketing departments.

This survey, Marketing Organizations in the Age of Martech, asks you for three pieces of your organizational structure (titles or roles only, no names):

  1. What roles report to your CMO (or highest-level marketing executive)?
  2. Who is in charge of marketing technology management and what roles report to them?
  3. Who is in charge of marketing operations — if that’s a separate role from marketing technology — and what roles report to them?

You don’t have to identify yourself or your company to participate. And all data will be aggregated and anonymized before it is published. But we will share the results at the end with everyone in the community — no paywall or high-priced report at the end. We’ll do some nice visualizations to reveal the different org patterns that we discover.

As an extra little “thank you,” we will also provide everyone who completes the survey with a discount code for the upcoming MarTech conference in Boston, October 2-4.

Please. Take 10 minutes to contribute to this survey now. Thank you!!

martech_org_study

P.S. The marketing org chart shown at the top of this post is an amalgamation of several of the common structures that I’ve seen recently. But this Marketing Organizations in the Age of Martech study will give us a lot more real-world data on the different structures being used.

Please participate — thank you!

Are you leveraging technology to make it easier to do business with your company or harder?

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Customer Insight & Analytics Exchange: Highlights From The First Day

by Maz Iqbal on 13 July, 2012 – 09:01

Today I wish to share with you the key points that I took away from my participation in Day One of the Customer Insight & Analytics Exchange conference taking place in London.

Are you measuring the Customer Effort Score?

Moira Clark of the Henley Management Centre for Customer Management made the case for measuring the effort that the customer has to make in doing business with your company.  She argued that the Customer Effort Score (CES) is more predictive of repeat business and higher spend than NPS or CSAT.  This clearly suggests that customers favour those companies that take the effort out of doing business with them.

If you want to grapple with getting a handle on and reducing the amount of customer effort then Moira suggested mapping the customer journey.  The objective being to identify what level of effort is experienced at the various stages of the customer journey.  And to figure out where to intervene to reduce the customer effort.

Which dimensions of effort should one consider? Cognitive, Emotional, Time and Physical.

Customer Journey Mapping: what does it bring to the table?

The panelists (from Orange, Aviva, RSA) agreed that customer journey mapping is an effective way of generating insight.  It can give people access to what the customer goes through; the customer’s perception of the experience; which touchpoint matter to customers; where touchpoints/interactions/processes are broken; how much money the company is ‘losing’ as a result of service failures and lost customers……

A danger that was highlighted is that of confusion of customer journey mapping with business process mapping.  That is to say that it is all too easy to take an inside-out approach (focusing on what matters to the company as opposed to the customer) whilst thinking that you are taking an outside-in approach.  For customer journey mapping even to cross the threshold and enter into the margins of the outside-in orientation it is necessary to get access to/involve customers in the mapping and evaluation of the customer journey.

What are you doing about engaging your employees?

Derek Brown of Vovici made three great points.  First, employees do have valuable feedback on what matters to customers and how the customer experience can be improved.  Second, ultimately any insight has to operationalised and that involves the employees – especially those that serve/interact with customers.   Third, there is value in connecting feedback from customers and feedback from employees. It was interesting to note that only about half of the participants said that their companies sought to gain feedback from their employees.

Analytics: does the real power lie in business model disruption?

Chris Roche of Greenplum (EMC) made the point that the real power of data mining/predictive analytics might just lie in business model disruption.  For example, by harnessing breakthrough in human genome mapping and the power of predictive analytics it is possible to identify who is at the risk of which disease.  Which in turn allows a complete transformation of the the NHS (National Health Service) in the UK: from treating acute disease to encouraging/enabling wellness.    Another example is insurance companies.  They can put a device in the customer’s car, record/analyse driving behaviour, come up with a personalised risk profile and thus provide a premium tailored to the risk profile of each individual customer.

What is the future likely to look like?  According to Chris the incumbents are likely to use analytics to make incremental improvements.  And so the task of business model disruption will fall to new entrants who do not have an installed base / revenue stream at risk.

Does the ‘age of the customer’ require a learning organisation?

Suresh Vittal of Forrester made the case that we are in the ‘age of the customer’ and that means customer obsession in term of generating customer insight (‘customer truths’) and taking effective rapid action on these truths.  How many companies are at this point right now?  About 12%.   What kind of organisation is best suited for generating and operationalising customer insight rapidly/effectively?  The learning organisation.  Which group of people are the main obstacle to putting in place a learning organisation?  According to Suresh, it is the Tops.

Which is better for generating customer insight: quantitative or qualitative?

The panelists (from Whitbread, HSBC, JustGiving, Forester) agreed that this is no longer a useful way of thinking about insight.  Customer insight is more useful if both quantitative and qualitative techniques and insights are used.  For example, if you are looking to optimise the customer experience on the website you would start with quantitative to know what is happening on the site and then follow this up with qualitative research (surveys, focus groups, user experience labs) to work out the why.  And with this level of understanding you can take action.  On the other hand it is possible that qualitative research will throw up some customer insights which will need to be validated/quantified through quantitative research in order to decide on whether it is worth acting on the customer insight.

My take on the day

It occurs to me that the customer insight community is grappling with the same kind of issues that it was some ten years ago:

  • How can we get the business to act on the insight we generate?
  • How to make sense of the information from disparate sources to get at genuine customer insights that make a difference?
  • How to convert data into actionable insight?
  • What should we be measuring: CSAT, NPS, something else?
  • How do we integrate the quantitative side (analytics) with the qualitative side to generate rounded insight?

The second ‘truth’ that hit me is that there is huge gulf between the theoreticians and the practitioners.  The theoreticians – analyst, technology vendors – make even the most complex sound so easy.  The practitioners are finding it difficult to get even the simpler stuff done.   One practitioner summed it up nicely when she stated that whilst it sounds easy, it is anything but easy to generate useful actionable insight and get this acted upon effectively and rapidly by the various players in the organisation who have their own agendas/priorities.

Original post: http://thecustomerblog.co.uk/2012/07/11/customer-insight-analytics-exchange-highlights-from-the-first-day