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See you in LA next week? April 1, 2008

Posted by Elana Anderson in Customer Analytics, Customer Experience, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Marketing Strategy, Marketing Technology, Online Marketing.
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Busy, busy, busy! That’s the month of April for me. Sorry I haven’t been posting the last couple of weeks, but I have a ton of balls in the air at the moment. One of the major things I’ve been working on is a minor treatise aimed to help marketers systematically improve the relevance of their customer communications. My work on this whitepaper, “Marketing Beyond The Status Quo,” is sponsored by the good people at Responsys and we’re planning to unveil it together next week at Forrester’s Marketing Forum in Los Angeles.  Our session is Tuesday, April 8th at 2:25pm. I’ll be presenting along with Scott Olrich (Responsys’ CMO) and Randy Cuff (Director of CRM Development at Intrawest). Here’s the abstract for the session:

Few interactive marketers are ecstatic about their ability to deliver meaningful and timely marketing messages. In fact, most agree that more relevant and timely marketing communications will be better received by customers and increase response rates. However, when time is scarce, budgets are tight, and single channel campaign management solutions are already integrated and delivering ROI, marketers are hard pressed to change the status quo. In this thought-provoking session, Elana Anderson, former Vice President and Research Director leading Forrester’s marketing practice, and Scott Olrich, CMO of Responsys will unveil the findings from a first-ever study identifying the drivers of the “status quo” paradigm, and reveal the strategies and marketing technologies smart marketers are using to deliver superior marketing performance and ROI across channels.  

If you are attending the forum, please stop by our session. I’ll be there for the full two days, so drop me an email if you want to connect at some point during the event. Hope to see you there!

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Recalibrating The Meaning of “Relevant” March 11, 2008

Posted by Elana Anderson in Customer Experience, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Online Marketing.
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Have you ever refinanced your mortgage only to be bombarded by offers to lower your mortgage rate for six weeks after you closed on your new loan? This happens because financial services companies are purchasing “triggers” from credit bureaus that indicate you have had a recent loan approval. The problem with these triggers is that they are not timely. By the time the marketing communication gets to the customer, it’s too late.

Relevance = right message + right time + right place

Perhaps it is a cliché, but it’s a good one. Too many marketers focus entirely on the message component of relevance. For these marketers, “place” is typically an outbound channel and “time” is based on the internal campaign calendar – not the customer’s needs. To be relevant, marketers must step outside the confines of the functional silo that they are responsible for and think outside in – from the perspective of the customer. In addition to targeting the message itself based upon a customer’s stated or implied needs, relevance requires:  

  • Timely reaction or response to customer actions. Although some marketers are experimenting with trigger-based communications and on-site customized messaging, the prominence of these tactics pales in comparison to the weekly or semi-weekly campaign pushes. The beauty of these tactics, however, is that they can be automated.
  • Cross-channel integration. Your customers don’t care that you are only responsible for email and not the website or direct mail and not the call center. When a potential customer clicks on a search result or an online ad and lands on your generic home page or receives an offer in the mail and calls customer service to inquire further, he expects a seamless handoff. Yet, creative elements often dominate conversations about integrated marketing rather than a focus on what the customer is trying to achieve as he traverses the channels. The result of this oversight? For the customer, it often means dead ends and unnecessary frustration. For the company, it means lost opportunities and, possibly, damage to the brand.
  • A programmatic approach. Did you know that maximizing individual campaign response might be to the detriment of overall program ROI? That’s right. Sending more messages may generate a higher response, but how many others are simply tuning out? The current industry standard in the retail sector is 1-2 email messages a week. Amazon differentiates itself in the inbox by not always being there. An email offer from Amazon might be, “A brand new Leonard Cohen CD is available. Since you have enjoyed Leonard Cohen in the past, we thought you might want to know…” This programmatic approach requires different metrics than the campaign-centric approach – for example, program engagement over time or revenue per customer (not campaign).

CPM Pricing Will Ultimately Put EMSPs Out Of Business March 5, 2008

Posted by Elana Anderson in Customer Analytics, Database Marketing, Marketing, Marketing Technology, Web Analytics.
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After my tirade yesterday against volume-based CPM pricing in the email marketing sector, I was disappointed to see the recent post on Bronto’s blog announcing the vendor’s move towards a volume-based pricing model:

For the last five years, we have priced our clients’ subscriptions by the number of the contacts stored in the application (i.e., list size.) This worked great in the early days because we primarily had small business-to-business customers. As we grew and our business and product became more sophisticated, we attracted more sophisticated clients that send at higher volumes. Since list size mattered less and sending capacity mattered more to them, the model became tougher to match with our clients’ needs and trickier to manage operationally.

My perspective? This may be a way to be competitive in the short term, but ultimately it will put the email service providers (EMSPs) out of business. Simply put, it makes the EMSP nothing more than what I have long referred to as a “dumb pipe” – a platform for bulk pushing out messages. Despite the economic challenges I addressed in my previous post, most (to use Bronto’s words) “sophisticated clients that send at high volumes” are actively working to improve their ability to target and customize their marketing communications in order to increase relevance. As I also noted, this requires tools and the necessary skills to understand and leverage customer data. If the email provider doesn’t provide these tools and services, you can be sure that other providers will be there to fill the gap. Carpe diem.

Walking In The Customer’s Shoes February 20, 2008

Posted by Elana Anderson in Customer Experience, Customer Experience Hall of Fame -- and Shame, Marketing.
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In 2004, a Forrester colleague (John Ragsdale) and I published a report which we notoriously titled, “Why Marketing Should Own The Contact Center.” Our chosen title was not aimed at changing reporting relationships. Rather, the emphasis and urgency we sought to establish was recognition of the fact that, for many companies, employees play an absolutely central and crucial role in establishing the customer’s perception of the business and the brand. Our position in the report (which is still absolutely valid today) was that the purely operational metrics – e.g., # calls handled, average call duration, etc. – by which many companies measure the performance on contact center personnel run counter to the objectives that many companies have established around improving customer experiences.

The report was focused on the contact center, but the concept extends easily to all employees that interact with a customer at any level. While books can (and have) been written on this subject, I want to focus on one element that I believe continues to be overlooked and underemphasized as the industry attempts to develop processes and technologies to facilitate customer interactions and improve customer experience. That is: empathy – specifically, encouraging and empowering employees to engage and relate with customers as people and fellow human beings.

Encourage Employees To Relate With Customers As Fellow Humans

While I firmly believe that no company can make every customer happy 100% of the time, the companies that have really made strides towards delivering differentiated customer experiences are taking steps to help employees better understand and relate to their customers. Some examples:

  • USAA makes customers personal for its employees. USAA, well known for its customer service leadership, caters to military families. To ensure employees empathize with its members, the company hires a high percentage of former military personnel, encourages employees to read personal letters from deployed service men and women, and incorporates aspects of military life into its new employee training program.
  • Cabela’s doesn’t draw a line between employees and customers. Cabela’s, a top direct marketer of specialty outdoor merchandise views it employees as be valued customers. The company encourages employees to take gear home and give it a try as long as they submit a review.
  • HP rewards employees that put customers first. In her recent article on CustomerThink, Liz Roche how HP encourages employees to participate in HP’s in store Demo Days. In addition, HP does a number of other things to help employees to better relate and empathize with customers. The company has established a formal customer experience training program to help employees experience interactions with HP from the customer perspective, it includes customer metrics in employee evaluations, it encourages employees to surface feedback from customers and provides tools to facilitate employee efforts to do so, and it awards employees that go above and beyond “customer hero” awards.
  • Four Seasons gives all employees a firsthand customer experience. Four Seasons, the luxury hotel and resort chain, provides all new employees – from chamber maid, to maintenance engineer, to kitchen staff – with an opportunity to stay at a property with a guest. This helps employees understand the customer experience from the customer’s point of view.
  • Fidelity Investments encourages all employees to interact with customers. My husband is a technology guy with Fidelity. All Fidelity employees are also customers. In addition, the company encourages employees, regardless of their role, to interact directly with customers. So, several times a year, my husband volunteers in the call center to take customer calls. These experiences help my husband take the customer into account when he and his team are designing products and interfaces that will eventually land in the customer’s hands.

Allocate Marketing Budget To Build Customer Empathy

Consider the billions of dollars that companies spend on marketing and advertising each year. Consider the number of scenarios when companies that you interact with as a customer don’t live up to the promise that the brand makes in its external messaging. If your company is not investing to help employees better relate to the customer, perhaps you should consider allocating some marketing budget to do so, eh?

It is URGENT that you give us a call… February 8, 2008

Posted by Elana Anderson in Customer Analytics, Customer Experience, Customer Experience Hall of Fame -- and Shame, Database Marketing, Marketing, Marketing Technology.
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6 comments

Have you noticed an uptick in the number of robot marketing messages that you are getting? I have and it’s making me crazy! For the last several years I have worked from my home office 2-4 days a week. In recent months, the number of calls that I am getting with robot marketing messages has increased dramatically.

Some of the messages are “transactional.” For instance, we get calls from Blockbuster reminding us that we have an overdue movie. But most of the messages are pure marketing. Yes, my phone number is on the DNC list, but these calls are coming from firms with whom I have a “preexisting relationship.” The company I bought my car from, financial services firms I deal with, etc. The most egregious, from my perspective, are the messages that come from my credit card company which go something like this:

Hello, this is Amy from your credit card company! Now, nothing is wrong with your card, but it is URGENT that you contact us immediately to discuss how you can lower your monthly interest rate….

The first of these messages came just after my wallet was stolen last spring (see my post on that descent into customer experience hell). What did I hear? “URGENT that you contact us!” I like to think that I’m a reasonably intelligent person but I must admit that it took me a second to realize I was listening to a pitch, not a customer service call.

It may be legal, but it’s the worst kind of spam

As a marketer, perhaps you’re wondering what’s wrong with this. I’ll tell you. For me as an individual, these messages are highly interruptive, irrelevant, and unwanted — not to mention misleading. If this came to me as an email, I could delete it without a second thought. It would be a little annoying but not annoying enough to write this post. These calls require that I pick up the phone and listen. They take more of my time and attention and they make me mad! 

I am not debating that these calls reach some people that probably consider a lower interest rate to be a very good thing. But, if my credit company bothered to do a very easy query against its customer databsae before teeing up these calls, it would see that I pay off my bill every month and don’t pay finance charges. Therefore, the interest rate is totally meaningless to me. For a company that I know employs fleets of statisticians and has very sophisticated customer analysis, I find this absolutely inexcusable!

Be responsible with this technology

I’m not suggesting that you never use this tactic to reach your customers. I am suggesting that you recognize that the phone channel is one of the most interruptive of channels (just shy of door-to-door sales) and if you choose to implement these automated phone campaigns you need to make sure that you are properly targeting your calls. Some suggestions:

  • Don’t use “preexisting relationship” as carte blanche to call. While it may be legal, there are customers out there that just don’t want the calls, period. I recommend filtering contacts that have registered for the DNC list out of the call list particularly if your list isn’t well targeted to customers for whom the message is clearly relevant.
  • Use data to target the campaign. If you have good customer analysis and response modeling capabilities then, by all means, use them. Even if you don’t, use basic queries to filter the list in order to screen out those customers for whom the message is obviously irrelevant. If you don’t have this capability, then you should not be running these campaigns.
  • Be more genuine in the communication. If you are properly targeting the message, then you can make a more genuine appeal to your customer. Rather than, “it’s urgent that you contact us!” empathize with the customer by saying something like, “we notice that you have been paying high finance charges over the last few months and we want to offer you the opportunity to lower your rate for the next three months…” If I ever do get in a situation in which I am carrying a monthly balance, then this kind of offer would come in handy and I would feel like my credit card company was on my side.
  • Be transparent with Caller ID. I failed to mention above that the calls don’t even have proper Caller ID (most say “unidentified number”). Although the FTC requires that telemarketing calls have proper Caller ID, apparently the rule does not extend to marketing phone calls where a “prior relationship” exists. I believe marketers should take the high road nonetheless and give customers the opportunity to screen the calls.

How Can Marketers Harness The Social Web? January 22, 2008

Posted by Elana Anderson in Customer Analytics, Marketing, Marketing Strategy, Marketing Technology, Web 2.0.
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This month’s topic over at CustomerThink focuses on how companies can leverage the social web to drive business results. Here’s the topic description:

Blogging, word of mouth and social networking can have a tremendous impact on how your company is perceived. But it’s a lot like herding cats. How do you manage all the people who can have an effect on your brand?

It is a lot like herding cats and I think the key question that the topic overview sets forth is a good one: How do you manage?…  Rather than attempting to manage the Social Web, I recommend that marketers:

  • Put down the bullhorn and listen. Corporations and their marketing arms love to be in control. While we will learn many more lessons from the Social Web in the coming years, a crucial lesson learned to date is that we – the marketers – are not in the driver’s seat. The community is in control. As participants in the Social Web, we must set aside our desire to control and manage the message. We must listen, interact as peers, and learn from the community.
  • Adopt technologies to help listen and learn. Social computing technologies provide a platform for anyone to rave or condemn the companies with which they do business. At the same time, they create a searchable public record of what people are saying. That’s the beauty of it! We now unprecedented access to what people say about us. But, it doesn’t make sense to have a fleet of staff running Google queries every day. To help, there are monitoring technologies and services from companies like Nielsen BuzzMetrics, Cymfony, MotiveQuest, and others that automate the task of capturing and organizing what people are saying.
  • Define processes to communicate, consider, and leverage the insight across the business. Positive or negative, we can learn from what people are saying and we can leverage what we learn many ways: for R&D or product development, to improve customer service, to refine messaging, etc. I believe that Marketing should be the conduit from which the entire company taps into this new valuable source of customer insight. Marketing execs need to take the lead internally to get processes in place to ensure that learnings are effectively communicated and considered for their impact on how the company goes to market and serves its customers.
  • Choose to participate with eyes wide open. While I do believe that all large companies should be in listen mode on the Social Web, I think the decision regarding whether to actively participate is more complex. Does participation help you sell more stuff, identify new market needs, or retain customers? It depends on your business and, beyond that, early adopters are still trying to blaze a path that leads to business results. As with any investment of marketing budget and time, make sure to establish goals – or at least a hypothesis – that define what you expect to gain. If you don’t do this, you can’t measure.
  • Always be genuine. We’ve already seen well publicized examples of fake blogs. The community loves to seek out and expose those who are disingenuous. Again, Marketers must relinquish their desire to manage, control, and manipulate. The Social Web offers an unprecedented opportunity to interact directly with your target audience, don’t blow it.

What To Expect From Your Web Analytics Tool (Web Analytics Series, Part 2) January 15, 2008

Posted by Elana Anderson in Customer Analytics, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Marketing Technology, Online Marketing, Web Analytics.
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In my post just before the holidays, I shared a framework to help marketers think about how web analytics contributes to data-driven marketing effectiveness over time. Marketers agree that they want to deliver more relevant and timely communications, establish a two-way dialog, and generally be more customer-focused and integrated, but many are struggling to make positive progress. Use the framework to understand understand the maturity of your data-driven marketing practices. Then define your objectives and timeframe for making incremental progress. In this post, I want to discuss how marketers can use their placement on the framework to define the key requirements for their web analytics tools. I work with an awful lot of firms out there that are not getting the benefits that they should be out of the technologies that they purchase. Why? Well, I think one key reason is that they are overly aggressive in their expectations of what they will achieve and over what time. The result is a lot of wasted technology — and wasted time.

Web Analytics Maturity Framework

If we were more realistic about what we are trying to achieve (i.e., the business outcome) with our web analytics tools then I believe our learning curve around how to effectively understand and leverage the data would actually accelerate. Why? Because we wouldn’t be constantly struggling with the technology. The free tools on the market are getting better and, while they are not sufficient for marketers that are beyond Stage 1 maturity, they will meet the needs of many. Here is a starting point to help you get beyond vendor eye candy and align functional requirements with business objectives:

Stage 1: Site analysis

Key questions you need to address:

  • How many visitors are coming to my site?
  • How are visitors using my site?
  • How are visitors finding my site?

Core functional requirements:

  • Visitor analysis
  • Referrer analysis (pages and keywords)
  • Strong library of parameterized “out of the box” reports

Comments on the market: These capabilities are table stakes to enter the web analytics market and most of the solutions out there do a reasonably good job here. Expect a more limited library of reports and more limited customization features from the free tools.

Stage 2: Site optimization

 Key questions you need to address:

  • How can I increase site visibility?
  • How do content and taxonomy influence desired action?
  • What would improve site navigation?

Core functional requirements:

  • Path analysis
  • Page and scenario drilldown analysis
  • Drop-off analysis
  • A/B and multivariate testing

Comments on the market: This is currently an area of focus for leading vendors in the market. The once-standalone optimization players – like Offermatica (acquired by Omniture), Kefta (acquired by Acxiom), and Optimost (acquired by Interwoven) – have been acquired and other vendors are looking to add these capabilities through acquisition or organic development. Given current client emphasis on customer experience management, expect this to continue to be an area of hot competition in the near future.

Stage 3: Segment targeting

 Key questions you need to address:

  • How can I logically group site visitors?
  • How can I target visitor content by segment?
  • How can I leverage site learning in other communication?

Core functional requirements:

  • Segmentation model templates
  • Ability to persist segments
  • Ability to create dynamic segments and apply them historically

Comments on the market: Leading web analytics vendors like Coremetrics, Omniture, Unica, and Visual Sciences (acquired by Omniture) offer segmentation capabilities but this is an area where vendors differentiate.

Stage 4: Individual customization

 Key questions you need to address:

  • What is the best content for an individual based on prior site interaction?
  • Should I reach out to an individual customer NOW?

Core functional requirements:

  • Individual visitor profiles retained over time
  • Ability to match profile to current visitor context – in real-time
  • Ability to unify profiles when visitor identifies

Comments on the market: A few leading vendors are really just starting to focus here. Omniture’s recent acquisition of TouchClarity is a good example. Unica is also working on integrating it’s web analytics and campaign management modules in a meaningful way. But, overall, the vendors are just getting started at figuring this out.

Stage 4: Integrated marketing

 Key questions you need to address:

  • How are customers using online and offline channels in the buying process?
  • How can I optimize online and offline interactions?

Core functional requirements:

  • Calculate and retain key profile metrics
  • Track metrics longitudinally
  • Open data model and facilitation of extracts to other systems

Comments on the market: Today, you’re mostly at the mercy of your internal IT shop when it comes to the level of data integration sophistication required to help marketers in large companies integrate their activities across channels. Some firms call upon their interactive agency, systems integrator, or database marketing service provider to help. But, each approach has its challenges. It may make you feel better to know that no one has nailed this one and that gives us all something to aspire towards. At the end of the day, I believe that if the web analytics vendors want to be part of the solution then they need to hire (or partner) with database marketing gurus in order to make real progress.

Marketers, Welcome To 2008! January 8, 2008

Posted by Elana Anderson in Customer Experience, Integrated Marketing, Marketing, Marketing Strategy, Marketing Technology, Online Marketing, Web 2.0.
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2 comments

I hope everyone had a wonderful Holiday Season! My 2008 is off and running at a fast clip and, once again, the blog had to wait while I dealt with matters related to my pocketbook. But, here I am and I simply couldn’t resist the urge for my first post of 2008 to be my own set of [perhaps wishful thinking] predictions for marketing in 2008. I mean, what kind of marketing blogger would I be if I didn’t throw my two cents into the discussion?…

Before the holidays, I shared some thoughts with Barney Beal over at TechTarget. He’s just released a podcast of our discussion. So, if you want to hear my voice (including a bunch of “ums”, “you knows”, and even a few giggles), please check it out. I’m also joined by my friend and former colleague, John Ragsdale, as well as Rob Bois from AMR. My lesson learned: don’t attempt to record a podcast on your mobile device while on the go!

So, here’s my outlook on marketing in 2008:

  • No sea change events will rock the marketing world in 2008. What kind of prediction is this!?! I don’t think I’m copping out here… I recently looked back at my predictions for 2005. Short of adding more focus to social computing and Web 2.0, I could republish that document now and call it a day (of course I’m biased, but I think it’s good stuff). My point is: marketers (and industry pundits) need to avoid the urge (and thrill) to seek out the next trend to turn into hype. While it’s certainly important to keep an eye on what’s on the horizon, don’t jump into the next new thing without a clear business hypothesis regarding its potential value. And, by all means, measure against your hypothesis.
  • The Web 2.0 hype will moderate and we’ll get down to business. I’m bullish that we’re past the days when all marketers seemed convinced that they needed start a blog or spend money in Second Life. While these tactics (yes, they are tactics – i.e., not strategy) make sense for some firms, for most they don’t. There’s no doubt that social computing behavior is having a tremendous impact on the way business gets done but it’s no excuse for taking the cart (tactics) before the horse (strategy).Ok, so what is important here? Ever since I joined the industry (late 80’s), I’ve heard statements like “customer is king” and “listen to your customers.” But in those days, marketers had the bullhorn. Today, social technologies give customers a platform and a bullhorn of their own. Companies that aren’t listening run the risk of being caught unprepared (and that costs money). There’s no question that there is tremendous potential to leverage social communities, but we’re still in the early days. In 2008, we’ll start sort it out. For many companies this means sitting on the sidelines and keeping an eye on the developments. For early adopters, be clear about the objectives behind what you are doing and establish how you will measure against those objectives.
  • Marketing organizations will get a social conscience. In line with my previous comments, firms need to recognize that today’s consumers are really good at sniffing out and publicizing inconsistencies between what corporations and their brands say and how they act. In 2008 companies must take this bull by the horns – or risk getting trampled. Specifically, I mean walk the talk and align your brands and your behavior in the marketplace with what you say. Whether you are a cataloger of outdoor living that happens to send up to 40 catalogs a year to some customers on your file, a consumer goods brand that purports to promote inner beauty and self-confidence among young women while marketing other brands that paint women as objects, or a financial services firm that invests in companies with business interests in areas rife with genocide – you need to get on top of this.

  • Significant emergence of on demand marketing technology. Tired of dealing with internal technology groups? Well, some good news for marketers on the technology front. The on-demand marketing technology sector is heating up and more viable (yet still not comprehensive) software-as-a-service options are emerging to help marketers plan and organize their activities more effectively, design and launch multichannel campaigns, and measure results. For more insight on this one, see The “On Demand Marketing Suite” Is Becoming A Reality.

  • More focus on behavioral targeting. “Behavioral targeting” is definitely a term that is generating an increasing amount of interest in the online marketing sectors. But, I also find that the term means different things depending on who you are talking to. I take a broad view. Specifically, I define behavioral targeting as:

    Leveraging aggregated and individual behavior data to deliver targeted and customized content to an individual — through online ad networks, on site messaging, as well as other online and offline direct communication channels.

    If companies would only define it this way, they’d recognize that they may very well have behavioral analysis experts sitting in one part of their company while individuals in another group are struggling to figure out the basics and complaining that they don’t have the right skills or tools. I’ll focus more on this one in future posts, but I want to say here and now that it is high time to get those cool spec wearing web data gurus together with the database marketing quant jocks.

  • Companies will start to sort out the role of the CMO. OK, I couldn’t resist. I know that this is one that tends to turn up every year and maybe it’s wishful thinking on my part but, we’ve all seen the stats about the CMO revolving door and I think it’s time for marketing to step up and take ownership. As I said in my recent post about the role of the CMO, I fervently believe that the role of the CMO is to “define and lead a customer-focused marketing strategy that crosses product, channel, geographic, and even functional boundaries.” If marketing fails to transform itself into this role, I believe that the CMO title will eventually die out and marketing will succumb to a future as a tactical, services-oriented role within the enterprise. As a related aside, I was heartened today to see the news that David Norton who has accomplished so much great stuff heading up relationship marketing at Harrah’s Entertainment has been promoted into the CMO role. We need more CEOs that think along the lines of Harrah’s CEO, Gary Loveman:

“In today’s complex multi-channel marketplace, we must continue to strengthen customer relationships and deliver high-quality brand experiences across our entire portfolio.”

What Does [Should] A CMO Do? December 18, 2007

Posted by Elana Anderson in Integrated Marketing, Marketing, Marketing Measurement, Marketing Strategy, Marketing Technology.
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In its quarterly SEC filing, Orbitz announced that it has (also see related AdAge article):

…decided to eliminate the global Chief Marketing Officer position and continue managing the Company’s marketing efforts on a regional basis. In connection with that decision, Randy Wagner, Chief Marketing Officer of the Company, is expected to leave the Company in mid-February 2008.

That’s unfortunate. I’ve met Randy — she was a keynote speaker at the Forrester Marketing Forum last year which I hosted. She’s a bright, strong leader and I’m sorry to see her go. But, I’m more concerned about Orbitz and all of the other companies out there that are cutting CMO positions and/or clearly struggling to define the role.

I think Orbitz is missing the point. I don’t disagree at all with the idea that defining and managing campaigns on a regional level can be a more effective way to drive to growth goals. I just don’t think that the job of the CMO is to define and manage campaigns.

So, what SHOULD a CMO do?

Well, we’ve been talking for years about integrated marketing, customer centricity, customer relationship management, customer experience management, 1:1 marketing, etc… I’ve been intimately focused in this arena myself for a over a dozen years and I feel like we (the broad and royal “we”) have made little progress towards these goals. To be sure, a lot has also changed in the last 12 years but if we EVER want to get there (or even close) then we need a strong leader. And, from my perspective, that leader is the CMO. The role of the CMO should be to:

define and lead a customer-focused marketing strategy that crosses product, channel, geographic, and even functional boundaries.

I realize that this is much easier said than done. It starts with a CEO who believes in the business benefit of being customer-focused and a CMO with the vision, leadership capabilities, and charter to make it happen. It will also require:

  • A complete overhaul of the marketing organization. I’m talking structure and reporting hierarchies, metrics, culture, and process — all of it. What’s the right answer here? Well, as all good consultants say, “it depends”;-) I haven’t found a perfect organization yet. The key is understanding where the organizational weaknesses are and then putting tools or processes in place to help bridge the gaps. First and foremost, however, I believe it starts with the metrics. The CEO, CMO, and CFO need to sit down and figure out how to measure marketing impact in ways that don’t result in marketing teams competing with one another for customer mindshare or quibbling over which team gets credit for customer conversion.
  • Acquiring and nurturing new skills. What skills am I referring to? Left-brained skills: business acumen, process orientation, quantitative analysis, and technical knowhow. We’ve been talking about this one for a while and it is slowly happening. But, marketing leaders often complain that it’s hard to find these skills along with a love of the customer and a passion for marketing all in the same body. I suggest looking for consultants (Accenture, Bain, etc.) who want to get off the road, pillaging your internal IT organization for the systems analysts or project managers that always ask the business questions, or plucking young marketing analysts for whom there is no technical barrier and putting them all in an aggressive mentorship and cross-team training program. 
  • Significant investment in technology and infrastructure. How boring is this one? My POV on this is that rather than going goo-goo gaga over the next trend and treating it as a antidote to all of marketing’s woes, it’s high time for marketing organizations to recognize that technology — and integrated technology at that — is a crucial enabler. To achieve our goals of customer-centric and integrated marketing, we need to manage the marketing process on top of a framework that is, itself, integrated. Again, no easy answers here — there’s no vendor or application out there that will take care of this for you. And, I’m not saying that the CMO has to be a techie. But, a good leader recognizes his/her strengths and weaknesses and surrounds him/herself with a team that can fill the gaps. The bottom line here is that marketing organizations need to have a technology strategy. Those that don’t will NEVER achieve the customer-centric vision or be able to effectively integrate their activities.   

Who is responsible for driving this agenda — on a global level? The CMO.

Now, I also want to be clear here that I was not implying above that the CMO doesn’t have responsibility for the global brand(s)…  She does! Today’s consumers are really good at sniffing out and publicizing inconsistencies between what corporations and their brands say and how they act (think the recent Unilever Dove/Axe controversy). So, today’s CMOs must own aligning every brand under the corporate umbrella with the core values of the corporate entity and reconciling the brands with one another. Companies that fail to do this are at the mercy of the consumer.

Web Analytics Needs To Grow Up (Web analytics series, Part 1) December 11, 2007

Posted by Elana Anderson in Customer Analytics, Customer Experience, Database Marketing, Integrated Marketing, Marketing, Marketing Measurement, Marketing Technology, Online Marketing, Web Analytics.
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Last week I was privileged to spend the day in the company of several thought leaders in the field of Web Analytics. Dr. Alan Hall, Avinash Kaushik, Judah Phillips, and I participated in several taped panel sessions that focused on how to best leverage web data to improve marketing effectiveness and how to effectively leverage investments in web analytics technology. We were joined by, Steve O’Brien, Akin Arikan, and Karen Hudgins from Unica which sponsored the get together. What struck me most about our conversations (on camera and off) is how committed each of us is to moving Web analytics beyond what today is largely a passive, report-centric discipline towards one that:

  • Improves the effectiveness of individual customer interactions
  • Actively contributes to the understanding of the customer
  • Is a key part of improving marketing’s ability to measure across channels

Five key stages of web analytics maturity

One of the bits of original thinking that I contributed to the discussion was a framework that breaks down five stages of Web Analytics maturity.

Web Analytics Maturity Framework

Don’t pay attention to the stages for the moment… This is not a new picture (I pulled the base graphic from a from a client deck I presented in 1998). And, few would disagree. If a marketer is not leveraging any data to drive marketing communications, just adding a little bit of filtering or segmentation will have a tremendous positive impact on results. But, at some point, our ability to continuously improve results through segmentation levels off. At that point, the way to get the next hockey stick impact on results is to use individual customer data. Definitely not new thinking, but I think it helps level set us that is what “1:1” or “customer-centric” (you pick the cliché) marketing is all about – using knowledge about the individual customer to drive interactions that, at the end of the day, benefit both parties.

This framework can also help us think about how we are using the mountains of web data that we’re collecting to help us move up and right on the chart. I break the role and the progression of web analytics down into five stages:

  • Stage 1 – Site analysis: When we get started, we’re really just trying to get our arms around the data and the traffic on our site. The focus is to understand how visitors are getting to the site and what they’re doing there. But you also need understand why they’re there and whether they were able to accomplish what they set out to do. How do you do that? Avinash suggests that’s quite simple, ask.
  • Stage 2 – Site optimization: The goal, of course, is to avoid analysis paralysis and look for ways to leverage the insight we are gaining about how visitors access and use the site to drive more visitors to the site, to optimize the experience of visitors once they are on the site, and to help more visitors accomplish what they were trying to do.
  • Stage 3 – Segment targeting: As we continue to focus on improving customer experience, we inevitably start to look for ways to segment visitors into different groups either through data explicitly provided by the visitor or through insight inferred from the session and prior interaction data. We then apply the segmentation to customize visit experiences and target content.
  • Stage 4 – Individual customization: At some point, our ability to continually apply finer segmentation and impact results levels off. That’s when we start to apply individual-level web interaction data to customize online interactions.
  • Stage 5 – Integrated marketing: Of course, the holy grail of all of this is fully integrated and customer-centric marketing in which we seek to integrate insight from online behavior with what we know of an individual across other channels. And, we do this in order to inform and optimize all interactions – regardless of channel – with the individual.

The sad part of all of this is that few companies have matured their Web analytics capabilities beyond Stage 3. In fact, I’d estimate that 80% (not based on a quantitative study!) of firms are at Stage 1 or 2. Why? Well, it’s darn hard! There’s tons of data to wade through, the industry is learning as it goes, and the technologies that help marketers move up the curve are still pretty immature and poorly integrated.

So, how will this framework help?

Use the framework to understand where you are today and what you want to work towards and over what time frame. Each stage of maturity focuses on unique business objectives, requires a different level of analytical savvy, and demands different functional capabilities from your supporting marketing technology.

Over the next several weeks, I will continue to drill down on this topic with additional posts. Please add to the discussion by commenting and providing feedback on the blog or feel free to contact me directly.