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Marketers Can’t Treat Customers as Nameless, Faceless

By Jeanne Roué-Taylor

Today’s fitful starts at marketing personalization are remarkable for how much they take us back to the future. It wasn’t that long ago when many of us could still remember that a shopkeeper knew every single customer—and not just by name, but also about knew their family, shopping history, and preferences. As we moved to cities and shopping shifted from small stores to large ones, and then to the shopping malls, that personalized experience was left behind. Customers became nameless and faceless in the rush to streamline processes and serve ever-larger numbers of people. It would have stayed that way if not for a few changes in technology that forever altered customer expectations.

The Age of the Customer

Expectations have been rapidly changed by social collaboration, mobility, cloud, and the access to larger amounts of data. The more marketers respond to the opportunities technology enables, and with more personalized interaction, the more customer expectations rise. This virtuous cycle is the reason many say we’ve entered a new era best described as The Age of the Customer. It is no longer enough today to have a transactional relationship with those you serve. Customers are demanding to be treated as individuals, expecting to be heard and to interact with you at their convenience. They expect to receive personalized and relevant offers for products and services. As a result, marketers who are still using batch-and-blast methods are increasingly recognized as dinosaurs. The problem isn’t just the use of old methods—customers are evolving rapidly, and even well-intentioned marketers are slow to respond.

What Isn’t Working for Marketers

Marketers are struggling with separate systems for every aspect of their customer interaction. Data is coming from everywhere, but too often ends up in storage silos that prevent a 360-degree view of the customer. Without a way to pull data together and too few data scientists to manage complexity, marketers can’t find deep, actionable insights that would allow easy interaction with customers. Beyond the lack of a single view, those data silos are a marketer’s ongoing nightmare of conflicting data sets, inefficient use of resources, and, worst of all, inconsistent customer experiences. These challenges are part of the vicious cycle facing those who are trying to keep up with their customers.

Creating Successful Marketing and Satisfying Expectations

Becoming competitive isn’t a matter of simply spending more. To compete, marketers need to take a new approach that includes new requirements around integration and elimination of information silos. Better technology helps enormously to address the needs at the core of personalization, which include:

  • Strong data discovery capabilities
  • An ability to quickly develop hypotheses
  • Efficient test and learn approaches

These needs require CMOs to actively recruit strong analytics talent, but to also look for marketing platforms with built-in analytics. Only a well-conceived platform can allow marketers to take full advantage of big data, the DNA at the core of understanding customers’ emotionally based, deeply-rooted buying decisions. These are the decisions that are below the surface, less rational, and price-based than those brought on by the consumer’s access to mobile computing. TIBCO Engage is a platform built specifically for these problems and opportunities.

See the TIBCO Engage platform in action in our webinar on September 24th. Sign up today, or email engage@tibco.com for a demo.

Never Underestimate the Power of Customer Inertia

By Jeanne Roué-Taylor

“People maintain habits until they don’t.” This quote from American economist Richard Thaler is the customer loyalty marketer’s credo and underpins one of the core ideas of loyalty marketing resource allocation—to stay on the winning side of customer habits, you need to nudge and encourage constant, incremental growth and relationship development, whenever and wherever possible. On the flip side, you also need to sound the alarm and swarm when it appears customers have changed their habits in ways that aren’t mutually beneficial.

Marketing and Satisficing

Marketers have come up with the term “satisficing,” which isn’t widely used but perfectly explains this idea. Satisficing involves producing decisions that are good enough given the constraints present in a situation.

Studies consistently show that people tend to select the first option that meets a given need versus searching for the optimal answer. For marketers, by ensuring that each and every decision has an option that is good enough, customer relationship inertia is maintained. Inertia is everything.

The Power of Inertia

There are plenty of situations where keeping a customer happy involves satisficing—keeping the inertia going—rather than offering every possible solution, even if that means the perfect answer isn’t available. Never underestimate the power of inertia in customer loyalty success. While inertia and loyalty are different concepts that shouldn’t be confused, the nudges, influences, and rewards of customer loyalty marketing are an excellent way to maintain inertia.

To learn more about the success factors in customer loyalty, check out our webinar on the topic: Nudges, Influences and Rewards Part 2: Must-know Factors for Success in Retail Customer Loyalty.

Avoid Losing Your Customers—Or Margin—With the Right Marketing Spend

By Jeanne Roué-Taylor

Why do your customers _______ (buy, rent, subscribe, bank, fly, etc.) with you? This is a complicated question because there are many “paths” to the answer, not unlike the directions Google gives from Point A to Point B in a modern city. It depends on each customer’s individual goals and preferences…the rough equivalent of deciding the fastest, most direct, or most scenic route. Without an answer, it becomes a challenge for how much marketing spend to dedicate to maintaining the pull with existing customers.

Marketing Margin Wasting Problem

Untangling this question involves having a framework for understanding how to focus resources and time on marketing based on the customer’s spending levels. Marketing nirvana is about getting it just right by finding the sweet spot and aligning tactics so that a high-spend customer has just the right amount of marketing focus/spend to not be at risk from a competitor, nor at a point of reduced profitability.

Easier said than done.

Optimizing Marketing Spend

While it may not be easy, it is becoming easier than ever before. Optimizing spend involves having a deeper understanding of the customer and what it takes to drive the marketing success metrics that matter most. There are ways to optimize across the customer base that are different for every company, but the process for determining the right levels has become clearer and broadly applicable in recent years. The tools are far better, the visibility into customer behavior across a wider set of interaction points is better, and there’s a much more complete pool of data to optimize against.

There’s more to optimize today than ever before.

The Marketer’s Most Important Job—The Maintain Phase

Finding that optimal point of return changes based on the lifecycle of the customer relationship, which spans from Acquire to Recover, as shown in the diagram on the right. The marketer’s job is to get customers into the Maintain phase as fast as possible and to keep them there as long as possible. The three curves on the diagram are high, medium, and low spend, reflecting that fact that not all customers can spend at the same level over the long term. Marketers need to have best practices for each level of customer spend, recognizing that there are different ways to influence and different levels of return on investment for each.

Marketers need to know their own maintenance patterns. Nudge too much and profitability goes down; nudge too little and frequency and revenue go down. (We’ll focus more on that soon.)

For more on how to use nudges, influences, and rewards to create success in customer marketing, check out our on-demand webinar, Nudges, Influences and Rewards Part 2: Must-know Factors for Success in Retail Customer Loyalty.

INFOGRAPHIC: Top 10 Marketing Trends for 2014

 

 

To learn more about TIBCO’s Top 10 Marketing Trends for 2014, download the whitepaper and watch the webinar.

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Top 10 Marketing Trends for 2014

LoyaltyLab.com

The Bar Is Higher Than Ever for Customer Experience

By Jeanne Roué-Taylor

Customer experience is going through rapid change. At the Forrester East Coast Customer Experience Forum in New York, the hot topic—and even the title of the conference—was “Why Good Enough Is Not Good Enough.” We’ve entered a new age of competitiveness that raises the bar significantly and forces brands to rethink the ways to know the customer better, and to trigger their passions where possible. Where it was once all about stocking the right products and having well-trained sales and customer service associates, today’s customer experience is defined by, as Forrester puts it, “…your people, processes, and technologies.”

Outperforming the Market

Is it worth the cost of making your customer’s experience that much better than with your competitors? A 2013 study by Forrester showed that customer experience leaders, over a six-year period, outperformed the broader market with returns that were three times higher than the average S&P 500 company. Likewise, customer experience laggards underperformed against the same S&P average with returns of -33.9 percent. Those are compelling numbers and reflect the benefits that great customer experience management confers on the brand: higher retention rates, lower acquisition costs, and greater customer lifetime value. A focus on customer experience is a gift to the customers for sure, but also clearly a gift back to the giver.

What Can I Do About It?

These numbers are great, but what can you as a brand do to improve your customer’s experience? For starters, you can make sure you’re collecting data about your customers that helps connect you not only to their preferences, but to their passions as well. The North Face has done a remarkable job at capturing what its customers care about—not just how they shop. Secondly, you can take steps to make your brand trusted, remarkable, unmistakable, and essential, aligning with Forrester’s Tracy Stokes’ acronym, T.R.U.E. These are the four concepts that create a brand compass for customer experience.

Lastly, you can make sure you’ve created the technology environment to manage the ever-increasing amount of data that great customer experience requires. People can be trained and processes determined, but having the right foundation of technology is a key differentiator. With it, you can discover your customers’ patterns and propensities, “see” them in the moment, and respond in ways most likely to result in a positive outcome for both the customer and the brand.

To learn more about bolstering your customer experience, download our whitepaper, Customer Loyalty Management: Finding the Holy Grail of Marketing.

The World Will Compete on Customer Experience

By Jeanne Roué-Taylor

The time is fast approaching where the stiffest competition for a customer’s wallet share will come from customer experience and the ensuing loyalty. You might think from everything you hear that we’re already there, but we’re not. Despite the rapid growth of smartphones and tablets, we haven’t yet reached the point where the majority of consumers are shopping digitally—yet. That leaves a little time, but very little, for brands to gear up to compete on customer experience.

Brands Are Already Investing

The brands that recognize what’s approaching are already investing in a platform approach to gain their customer’s trust and loyalty. A platform approach, rather than cobbling together point solutions, is a key part of making sure that the data necessary to create great customer experiences is available to the marketer, and ready for analysis and action.

Why a Platform?

The world will compete through customer experience platforms because we’re in a fast-moving digital data age that requires significant integration to make the concept work. This is due to the fact that customer experience is affected by a rapidly increasing number of touch points with the customer. What used to be face-to-face is now on the web or on a smartphone, any time of the day, and in many different contexts.

The diversification of context, in fact, is what makes customer experience such a challenge and, at the same time, such an opportunity. Context used to be far more simple. Is the customer on the website or in the store? Are they known or unknown? Going forward, the questions will range far further and have far greater dependence on interconnected data and systems. The new questions will include: When did the customer last interact? What was the outcome? What’s most likely to be an effective response in this moment?

And from the customer side, there are also far more questions: Does the brand recognize me quickly and easily? Does the brand value me as a repeat customer in a way that matters to me? Can I maintain my expectations regardless of the time, place, and platform that I prefer in the moment? The answers to these questions will determine whether a brand is able to compete on customer experience.

If you can’t answer those questions for your customers, it could be time to take a step back and change your approach.

For more on improving your customer experience, don’t miss our webinar, Nudges, Influence and Rewards: Must-know Factors for Success in Retail Customer Loyalty.  

 

The CMO’s Massive Transformation

By Jeanne Roué-Taylor

Customer expectations have always been tough to match, but never has the challenge been as great as right now, in our always-on world. CMOs face the daunting task of striking the perfect balance between being relevant and safeguarding a customer’s privacy—a tough job when relevance involves leveraging customer data. A brand can only disappoint a customer once when it comes to privacy; managing customer trust is a difficult job.

And Then There’s the Data

Beyond the relevance and privacy concern, CMOs need to find and manage massive amounts of data, both historical and real time. This data isn’t found in one place—it’s found in many, and it needs new levels of connectivity to make sense and be useful. Without it, marketers can’t discover patterns themselves using visualized analytics and can’t apply the math that seeks trends and data combinations that the eyes can’t see.

From Creative to Technical

To top it off, the traditional CMO often has a creative background and isn’t necessarily an expert in data science and information technology. Suddenly, new rules call for the CMO to be able to go far beyond brand steward and to scrutinize every expenditure to understand the ROI of using emerging technologies.

In the heat of battle, many CMOs have spent money on SaaS and in-house point solutions that simply don’t play well together, or have the flexibility to morph with the marketplace and customer demands. Managing this massive transformation takes a more thoughtful approach, and the combination challenges CMOs face require an approach that preserves creative engagement while applying the right focus to technology and analytics. Rather than make each technology purchase separately, smart CMOs are building out from a common platform that provides the technology foundation to support analysis while carefully managing privacy, and supports creative flexibility while keeping the focus on being accountable for marketing spend.

The platform approach, starting with access to an unlimited amount of disparate data, is the only plan that makes sense for true transformation.

The Customer Experience Redefined

By Jeanne Roué-Taylor

What happens when any customer can find any product in many places, even far away in an entirely other economy; while at home, work, or on the go; and at any hour of the day? What happens when those products can be delivered, for free, as soon as the next day?

Customer experience management (CEM) as we know it is being completely redefined to meet the needs of a massively shifting buying landscape. Toss out the old assumptions and get ready to break the rules—CEM has a whole new meaning.

How Much Can You Manage Customer Experience?

A brand can’t expect to be able to truly manage the experience in the old way. The concept of managing anything is based on having a customer’s full attention and a certain expectation for a selling cycle (time, messages, process, follow-through). Those are assumptions that no longer exist when a customer can buy from anywhere, even in another brand’s physical location. Customers themselves are now in charge.

So what can a marketer do given these significant changes? For one, there needs to be a new consideration of how to get a customer’s attention. Customer loyalty programs are an obvious fit for getting the customer focus despite the distractions. Second, the experience can’t start and end at the point of purchase. A longer, deeper interaction with a customer guarantees the decision will, at minimum, include the brand when the time to buy arrives. Third, a brand needs to be where the customer’s interactions are taking place. Today, that includes physical locations (but not always), mobile, and social media.

Participating in Customer Experience

In the end, what a brand can realistically achieve is to participate in the customer’s experience. That participation involves having faster access to a customer’s circumstances, better analytics that explain the likelihood the customer will respond when engaged, and a smarter way to test and learn the best ways to improve that customer’s experience. This is the new reality of CEM and a better way to understand the changing task of managing what can be managed, and participating in the rest.

Fast track your customer experience management with Jumpstart from TIBCO Loyalty Lab. Learn how.

Customer Experience Hinges on What You Know and When You Know It

by Jeanne Roué-Taylor

Today’s marketers needs to be focused intently on all of the data that can be gathered about their customers. This modern reality means that data’s two dimensions—”what we know” and “when we know it”—take on a completely new and higher level of importance. This is exactly why CRM falls short when it comes to capturing interaction with the customer in a way that tracks and improves the relationship.

Marketing Is About the Context

The limited data model of traditional CRM systems lacks the context required to engage customers in the best ways possible. That’s because the data available to marketers today isn’t simply historical interaction like transactions. With the data generated by mobile, Web, social and location technology, we can have the context of the customer’s current moment, where decisions are being made, enriched by the over-the-shoulder information from systems like CRM.

Managing Data’s Two Dimensions

This data coming from all directions presents an enormous opportunity for marketers to know more and to know it much more quickly than ever before. Excellent management of data’s “what” and “when” dimensions makes customer engagement a carefully analyzed, modeled, and orchestrated event, instead of an unwanted intrusion. It has relevance and value rather than being noisy and ignored.

Order In Data Chaos

If you’ve ever been to an air show, you know that the planes involved appear to be on the edge of chaos as they make high-speed passes and other stunts. Marketing data today is the same carefully orchestrated but high-speed exercise that we see in the sky. As marketers expand what they know and shorten the time to know it, the customer feels a seamless and immediate experience with the brand. With the right technology, interacting in the “now” moment, despite the noise, looks elegant and easy. Most importantly, brands know what to expect in real time and what will likely happen next.

To learn more, visit www.loyalylab.com/expertise

Why Customer Loyalty and Why Right Now?

By Jeanne Roué-Taylor

During a recent trip to the grocery store, I commented at the checkout that I always receive coupons for baby food and diapers along with my receipt. I said sarcastically to the clerk, “You’d think I shop for those things and they know it.” The clerk nodded and completely seriously said, “I know, right? It’s like they’re watching everything. Doesn’t it seem creepy?” I had to laugh, but not until I was out of view. Like any period of rapid change, not everyone is fully briefed on the latest events in the digital revolution.

So Much Change

The clerk’s response isn’t all that surprising in the retail world, where so much is changing so quickly. As McKinsey said recently, we’re in the middle of a data analytics revolution. Everything we thought we knew has changed, and our ability to know the customer and tailor offers and other interactions is remarkably strong. Not everyone, the clerk included, realizes that customer loyalty is the opposite of creepy. In an era where so much can be known, predicted, and acted upon, loyalty programs are the only way to help the customer to feel comfortable with a brand’s knowledge of their habits and personal information.

Giving My Permission

A brand I feel loyal to, like my local grocery story, has my permission to track my spending patterns and to make offers on the products I’m most likely to buy or be willing to try. I look forward, in fact, to seeing what discounts and other deals they have in store for me. Think back to “coupon packs” and newspaper fliers of just a few years ago, where the majority of items were unlikely to catch our interest, and you’ll see just how far loyalty programs have come. Today’s programs have outgrown the simple points and plastic of yesterday’s brand loyalty and are executed as an integrated, marketer-friendly, data-enriched, real-time system.

A Loyalty-Driven Revolution

For retail, the digital analytics revolution that McKinsey talks about is loyalty-driven—it’s that simple. Brands that don’t invest in smart customer loyalty management risk breaking trust with their customers and losing business to the competitor who does.

To learn more, download our whitepaper on Customer Loyalty Management.