Gerry Murray

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Marketing to the Data Driven Customer

June 17, 2014/in Marketing /by 3 Created

Customers with digital DNA expect data driven value

The digital native generation is bringing new expectations to brand relationships. They are mobile first, crowd sourced, and data savvy. Their first and most frequent interaction with your brand will be digital and mobile. They find out what’s cool, what’s trending, and what’s most likely to work best for them from their social networks. They don’t have emotional attachments to brands because the product is compelling or the advertising is cool. Their emotional engagement comes from unexpected insights that make them more successful. This is the new basis of customer loyalty, advocacy, and lifetime value.

Of course you still need a compelling product and cool ads (or messaging.) But once the prospect is a customer, continual engagement depends on over the top data driven insights. It’s no longer enough to just sell the hammers and saws and let the buyer go build their house. You need to monitor how they are using the hammer and saw. You need to deliver success by guiding their use of your product based on the behavior of your most successful customers. You need to leverage your position as the center of your customer universe to share best practices quickly and efficiently. The only way to do that at scale is through data.

Data Ownership vs Data Stewardship

In between the lines, you should be hearing a new philosophy with respect to customer data. Even though legally you “own” it, the data driven customer expects you to act as a data steward. You must treat their data as an asset to be used for their benefit, not just as the basis for driving revenue. Everything you provide to your customers should be designed to bring data back. Your customers should learn that the more data they provide, the more value they get in return – without negative side effects like having their data sold to an irrelevant ad network. Give to get and maintain the trust.

This has tremendous implications. Not only for marketers. Data marketing requires coordination with product development, IT, finance, fulfillment, point of sale, customer support, consulting services, sales. All these groups interact with customers and capture data on different aspects of their behavior – product usage, purchasing, problem resolution, planning, advocacy, etc. They all need to be understood to identify the most successful customers and the traits that drive their success. You can create tiers of services based on the level at which customer provide data. You can create cohorts of customers that exclude direct competitors. You can support exchanges within your customer ecosystem that enable strategic accounts to benefit from preferred peers. You can be extremely creative about how you structure your data marketing services.

The message is that in a world of shrinking product cycles, cheap knockoffs, and copycat services, data marketing is the new source of differentiation. No one else has the data you (should) have on how customers can be most successful with your products. Use it to attract and retain the best and leave the rest to your competitors.

To continue the conversation on data marketing and the data driven customer, contact me: gmurray (at) idc (dot) com.

Marketing as a Service (MaaS): The next wave of disruption for marketing tech

May 18, 2014/in Marketing /by 3 Created

Marketing technology has seen a remarkable innovation boom over the past 10 years — so much so that the market now boasts over a thousand vendors that IDC organizes into more than 75 categories. IDC believes this structure is unsustainable and over the next three years the forces of consolidation will exert fundamental changes in the way large enterprises provision marketing infrastructure and from whom they provision it. The marketing technology market, like much of the IT industry, will move to a cloud based service model which IDC calls the “third platform.” As the illustration shows, more than 90% of the growth in the IT industry will come from this model.

For marketers, the third platform means the advent of Marketing as a Service (MaaS), which will have transformative affects for IT, IT services, and creative agencies. Key indicators that MaaS is on it way include:

Unsustainable complexity: Point solutions have come to market independently leaving it up to marketers to assemble them into rational infrastructures. This is a highly inefficient market model for buyers and sellers.
Transition to platforms: The consolidation of point solutions into platforms has already begun. Many noteworthy acquisitions have been made by major vendors such as Adobe, IBM, Oracle, salesforce.com, and SAP. However, this phase of market development will not last long as markets move rapidly from platforms to “… as a Service” models.
Digital and creative coming together:AdAge recently named IBM the number one global digital agency in the world. IBM is rapidly hiring from the agency world to build out its creative services. Adobe has deep and long standing technology partnerships with many top agencies. The agency world needs a value proposition that will allow them restore margins and regain strategic relevance.

MaaS includes the fundamental technology, IT services, and creative services that marketing needs in a bundled offering. Bringing these services together delivers significant value to CMOs who have two key sources of pain: On one hand, their agencies cannot effectively execute omnichannel campaigns nor deliver real time attribution reporting. On the other hand, technology has added a great deal of cost and complexity to their operating environments. MaaS enables them to outsource much of the technological complexity, pay for it out of their advertising budgets and get better integrated marketing services from their top agencies. For tech vendors it means gaining access to the advertising budget which dwarfs marketing IT spend by orders of magnitude. As a result, IDC expects this model to be a major route to market for marketing technology in the enterprise segment. It is therefore an urgent action item for tech vendors, system integrators, and agencies — partner now or lose a major channel.

For more information on this important trend please contact me at gmurray(at)idc(dot)com.

Measuring Sales and Marketing based on Customer Outcomes

April 16, 2014/in Marketing /by 3 Created

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.

The one framework your CMO must share with your CIO

March 10, 2014/in Marketing /by 3 Created

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:

Interaction: The primary function of these solutions is to be customer facing
Content: The primary function of these solutions is to facilitate the production and management of marketing content
Data and Analytics: The primary function of these solutions is to store and produce insights from customer, operations, and financial data
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.

Top 3 customer experience challenges for marketers

February 13, 2014/in Marketing /by 3 Created

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.

Busting the Myth of Sales Disintermediation

January 9, 2014/in Marketing /by 3 Created

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:

How to evaluate the strategic priority of the solution as well as the technical and business benefits
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.

Cross Training for Marketing

December 11, 2013/in Marketing /by 3 Created

Most marketing organizations are organized around a set of silos based on specialized program functions within branding or demand generation. The skills, tools, and relationships needed to manage advertising, events, email, website, social, video production, technical writing, etc. are very different. The pressure and complexity involved in each area can easily turn them into organizational islands. They may each have their own databases, audiences, and reporting structures. They may be further fragmented when replicated across business units and geographies. While specialization is necessary and will only increase, the fragmentation and separation that typically accompany it can break down the customer experience, introduce inefficiencies and redundancies, and slow down the whole marketing operation.

The challenge is how to make strong sustainable connections between specialists so that new competencies can be acquired without the negative side effects. Data management and analytics have emerged as two key skills common to every marketing activity. These topics are ideal for bringing marketers together to share how each of their areas produces and consumes data and the models and tools they use to gain meaningful insights. IDC recommends marketing organizations conduct regular analytics knowledge jams to share competencies, resources, and insights. To cross train them on the many other functions that affect customer creation. Key objectives include:

Provide visibility into how data is produced and consumed in other areas
Improve data capture, quality, and usability
Socialize important analytic models
Provide a more holistic perspective on the customer experience
Raise the overall data and analytics IQ of the marketing team

In each session, representatives from different groups share 15 minute presentations of what they are working on and how they use data and analytics. This will help combat the fragmentation brought on by specialization, reduce inefficiencies and redundancies, and make marketing more responsive.

Sales process – the missing ingredient for marketing ROI

October 2, 2013/in Marketing /by 3 Created

Most marketers in B2B enterprises have never been trained on sales process. If I were running your marketing or sales organization this would be the first thing on my agenda. Why? Because without understanding sales process, marketing is essentially set up to fail. How can anyone improve or contribute effectively to something if they don’t know how it works. It’s like setting up your manufacturing to produce blue widgets but not telling your suppliers what parts you need for your particular widgets. So they ship you tons of blue stuff and hope that somehow it all works out. That’s the position, to one degree or another that most enterprise marketing organizations are in even at some of the most advanced process-centric companies in the world. Largely because they have chopped up the customer creation process into a collection of departmentally independent activities.

In a large enterprise with many products lines, business units and segments, there are likely to be a number of different sales processes. Marketing and sales resources should be aligned against these processes horizontally. This is the key to making the shift from a siloed command and control organization to a responsive, integrated customer focused one. Not only is it important to design around sales process, which should be designed around the buyer’s journey, but it is important to design for change. Markets are dynamic and sales processes change.

Marketing automation systems, especially those that are integrated with the sales force automation or customer relationship management system, have begun to provide marketing with some clues to sales process. At least they can see what happens or does not happen when they deliver something to sales. But the data does not always explain why, and that’s the critical part. Marketing needs to understand very specifically how Sales operates in order to optimize around customer outcomes. The alternative is for marketing to optimize around departmentally focused KPIs like the number of MQLs (ugh), or SALs, or worse vanity metrics like hits, sentiment, likes, etc. These metrics are useful indicators for some marketing activities, but not as business drivers for marketing investment.

Aligning marketing and sales around sales process is the first step to formulating an enterprise customer creation process that extends across all customer touch points, including: billing, fulfillment, service and support. At each stage of maturity, marketing, as well as all the other customer facing departments, gain much greater visibility and accountability to the whole process and its connection to corporate objectives for growth, market share, and margin. This is all necessary for a true picture of marketing ROI.

Your action items:

Marketers: lobby your top executives to make regular sales process training for marketing a priority.
Sales executives: demand that marketing know how the different parts of your sales force work so they can more effectively develop prospects and serve customers.
CEOs: get smart about your customer supply chain by applying the same level of due diligence and process discipline to it that you have to your product and services units. As a result, you will make much more effective use of marketing investment and be able to hold your whole customer facing team accountable for its contribution to your strategic objectives.

Next Gen Marketing Teams: From Silos to Systems

September 23, 2013/in Marketing /by 3 Created

Automation has revolutionized marketing. It has brought new insights, capabilities, and methods of engagement. It has demanded new skills, thrust us into the omni-channel universe, and opened new levels of visibility and accountability. But these are all ripples in the pond, so to speak, only the most immediate after effects of a rather large splash down. The most profound change is just beginning to be felt. Automation has introduced the notion of an enterprise customer creation process, a horizontal function that cuts across all marketing activities. Effectively implementing and managing this process requires next generation marketing teams to be much more integrated and coordinated.

Despite its mystique as a freewheeling, creative and dynamic function, corporate marketing is in reality a deeply fragmented hierarchical organization. Specialists typically function in separate domains moving from project to project with great urgency, rarely having time to consider the big picture. The need to be highly responsive to changes in direction has created a culture adverse to structured workflows. However, as marketing automation solutions consolidate into an enterprise system, a diverse set of marketing roles, process definitions, and data structures are brought together. In response, marketers are beginning to redesign their organizations around workflows instead of activities. Rather than having social, web, advertising, content, partner, analytics, systems admin, etc. in separate organizational buckets, these roles are being reformed into cross functional teams responsible for executing entire campaigns.

Marketing solutions are starting to be designed around a multi-disciplinary community model. Adobe’s marketing cloud offers a collective view of the campaign workflow for each member of the team and unique workspaces for the various roles in content production, campaign management, analytics, etc. Each member can see what contributions have been made and why. They can communicate in real time on key issues and how they affect the overall process. IDC expects this trend to become pervasive. Providers such as Salesforce.com, Oracle, IBM, SAP, and others are driving their solutions around a vision of the “customer facing ERP” which integrates all customer facing functions in what will most likely be a hybrid cloud for managing customer experience. The implications for organizational design will be significant and CMOs should start instilling the culture of workflow based communities as soon as possible.

Create and Close Customers up to 40% Faster

August 30, 2013/in Marketing /by 3 Created

IDC’s CMO Advisory has conducted an annual IT Buyer Experience survey for the past six years. We have tracked many changes and interesting trends, but one thing stands out as a consistent inefficiency in the market: every year IT Buyers report the purchase processes can be approximately 40% shorter. Over the course of a 10-month average process that means the potential is to accelerate revenue by an entire quarter. This is a huge opportunity for both buyers and sellers with tremendous financial incentives for both and yet no improvement in six years. Why not and what to do about it?

Buyers put about 2/3 of the blame for this inefficiency on themselves. There are scheduling issues, conflicting agendas, changing budgets, changes in personnel, immature purchase processes, etc. The challenge for vendors therefore is two-fold:

Reduce the inefficiencies that are inherent in their own marketing and sales processes, and
Better facilitate the buyer’s process(es)

Gap between actual and ideal IT purchase processes, 2009-2013

To do this, vendors need to intimately understand the Buyer’s Journey. It starts with Exploration, moves to Evaluation, and ends with a Purchase. Buyers spend the most amount of time in the Exploration stage, largely independent of direct vendor interaction. As they move through each stage, their agendas change dramatically and the process accelerates. Buyers spend less time in each subsequent stage and have higher expectations of vendor response times. By carefully defining and monitoring buyers’ journeys, marketing and sales can better serve customer needs, keep pace with buyer expectations, and cut out big chucks of inefficiency.

For example, in the Exploration stage, the buyer’s main objective is to establish fit between their business challenges and a solution. The main resources they use are related to trends in their industry. The primary internal influencers are business buyers (functional leaders, business unit mangers, and executives.) Once they enter the evaluation stage, however, their objective and trusted sources change completely.

In our report, IDC CMO Advisory 2013 IT BuyerExperience Survey: Create and Close Customers up to 40% Faster, we outline specific steps IT marketers should take at each stage in order to get the right messages to the right decision makers. For more information, please contact me at gmurray (at) idc (dot) com.