Customer Centric Transformation – How Australian CMOs are Driving Change
Foreword
The concept of customer centricity is not new. It used to be easy: you were the owner of the local general store. You knew your customers by name because they came into your shop twice a week, on the same day, at the same time. You knew their family and their preferences, because you chatted with them at each visit. With this knowledge, you were able to recommend products, offer samples and stock merchandise that your customers valued most.
Now, your customers come from all around the world. They browse, purchase and return without ever setting foot in your store. They can compare prices in an instant and switch brand allegiance as quickly. They connect with your brand online, on their mobile and through apps or social media. You’re competing with brands that don’t have bricks and mortar stores, or brands that are international conglomerates. In the digital world the balance of power has shifted to the consumer. It is almost just luck that you are able to grab the attention of the consumer and their share of wallet. Times are tough for today’s businesses. That is why pressures of the new world are forcing organisations to once again put their customers at the heart of their business. This is customer centricity. It means understanding and focusing on what your customers value most, in a way that is in line with your overall business strategy and brand promise. Although customer centricity has been discussed as a theory for some time, what’s less clear is how you drive customer centric change. The challenge is, it’s different for every organisation. There is no roadmap to customer centricity. To identify what is working for some organisations, we spoke with Australian CMOs and marketers about how they are driving customer centric change.
John Merakovsky Managing Director, Experian Australia & New Zealand
We pieced these insights together to create this exploratory report. What it is not, is a step-by-step guide on how to become customer centric. Rather, it is a collection of insights from CMOs, their challenges, their learnings and their advice. It provides a practical approach for businesses and CMOs to use as a starting point, allowing them to identify signposts on their journey to customer centricity. And what we like about it, is that whether they’re at the very start of the journey, or years in and trying to take the next step, there is a signpost to help navigate this new terrain.
Executive Summary
Australian organisations are in the midst of great change as the customer centricity revolution reshapes the business landscape. Once viewed as a soft metric, customer experience is now a stakeholder priority, ranking alongside profit and return as measures of an organisation’s success. With little upstream differentiation customer experience has become the new battle ground. This, and the fear of falling behind the competition, is fuelling a growing pressure within organisations to shift customer centricity from theory to practice. However, without established processes or guidelines, CMOs are largely feeling their way. In an effort to build a roadmap for CMOs to navigate organisational transformation, Experian commissioned research which combined in–depth interviews with 20 of the country’s most respected CMOs with survey data from more than 100 top marketers. The research revealed despite a huge spread in the levels of sophistication within organisations, customer centricity is a high priority and even those in the early stages of their journey recognise evolution is crucial to survival. While every organisation’s journey is different, Experian’s research identified common themes across the board. To bring this to life we developed a Customer Centricity Maturity Index (CCMI) which identified four unique stages of customer centric transformation: Beginners, Followers, Challengers and Progressives. The road to customer centricity is paved with obstacles. Organisations starting their journey need to get the basics right, while those further along the path face more complex challenges. Data and analytics are at the heart of customer centric transformation and are imperative to success. Beginners have a more simplistic grasp of data and analytics and must focus efforts on accessing customer data and using it to enable an in-depth knowledge and understanding of customer behaviour and preferences to improve the customer experience. These organisations also lack integrated channels and IT systems that support customer centricity and were challenged by a lack of resources as well as leadership buy in.
Customer Centric Transformation – How Australian CMOs are Driving Change
As organisations increase in maturity, in the Follower and Challenger stages, they continue to build and expand their understanding of data through customer feedback, customer co-creation and design. In this way, they are able to inform their decisions and drive strategy. Many still have a way to go as they don’t have access to the right technology and struggle to demonstrate a return on customer centric initiatives. Progressive organisations are the most effective at delivering on all of the core elements of customer centricity. They are characterised by their ability to employ agile methodologies to deliver quick wins. At this sophisticated level, organisations are enhancing and enriching internal data with third party data sources to deliver a complete and detailed understanding of the consumer. They are also able to clearly demonstrate a return on these initiatives and as a consequence are able to secure additional resources. By examining shared experiences and learnings from CMOs in Australia’s leading companies, Experian has identified common signposts to help CMOs build a case for change and create customer centric enterprises.
This report offers practical insights for organisations as they embark on or continue their journey.
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‘At the heart of customer centricity is recognising that customers are different, understanding them and treating them as they like to be treated. You can’t achieve customer centricity if you don’t know who your customers are and how they interact with your business.’ David Chinn, General Manager, Experian Targeting
The Road to Customer Centricity – Mapping the Journey
Organisations have various degrees of sophistication and maturity in their approach to customer centricity. Experian research has identified the five key indicators of customer centricity performance: leadership, insights and analytics, resources, core processes and performance.
Leadership Executive management are committed to and actively involved in the customer centric transformation process. The organisational strategy is also aligned to customer centric outcomes.
Core Processes Channels are integrated to support customer centricity and IT systems support customer centric processes.
Insights and Analytics Customer feedback and behavioural data is routinely collected to improve the customer experience and there is a collaborative approach with customers to co-create new experiences, products and services. Big data and analytics are used to improve the customer experience.
Performance Robust measurement frameworks in place to determine the return on investment for customer centric initiatives.
Resources The right people, with the right skills and sufficient budget for customer centric initiatives.
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Five Key Indicators and Customer Centricity Maturity Index (CCMI) – How organisations perform
Progressives
Followers
Beginners
Executive management committed to and active in the customer centric transformation process
100% 100% 69%
19%
Aligning organisational strategy to customer centric outcomes
100% 92%
38%
12%
Collecting customer feedback to improve customer experience
100% 68%
54%
27%
Working with customers to create experiences, products / services
77%
72%
27%
12%
Using big data and analytics to improve customer experience
77%
52%
23%
0%
Having people with the right skills for customer centric initiatives
85%
76%
42%
8%
Having sufficient budget for customer centric initiatives
88%
52%
35%
8%
Having integrated channels that support customer centricity
88%
52%
27%
0%
Having IT systems that support customer centric processes
81%
44%
27%
8%
Measuring ROI for customer centric initiatives
85%
44%
23%
8%
Key Indicators
Customer Centric Transformation – How Australian CMOs are Driving Change
Challengers
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The indicators were used to rate an organisation’s performance which created a Customer Centricity Maturity Index (CCMI). This revealed four stages of the customer centricity journey: Beginner, Follower, Challenger and Progressive.
Beginner Profile Beginner organisations are in the very early stages of the journey and are characterised by low levels of engagement with the five key indicators of customer centricity. Beginners have not yet integrated these initiatives into the overall business strategy. The major challenges for CMOs in Beginner organisations are gaining senior support, accessing and improving the quality of data and securing the resource to launch customer centric initiatives. Data is a critical challenge for CMOs as their transition through the stages is largely marked by increasing sophistication with insights and analytics.
Follower Profile Follower organisations are more sophisticated than Beginners but have also not aligned customer centric initiatives with their overall business strategy. Followers are less likely to be working collaboratively with customers to inform their products and are under increasing pressure from the changing market conditions, level of competition and the continual need to differentiate. Followers only use customer data to provide insights in a limited way and channels lack integration. They are also more likely to have inadequate technology and systems.
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Challenger Profile Further along, Challenger organisations have made significant gains in aligning organisational strategies and subsequently are dedicating more time to drive customer centric outcomes. They are also more likely to work collaboratively with customers to co-create new experiences, products and services. There is still work to be done in extracting insights from customer data to inform initiatives as well ensuring they have adequate technology and integration across all their channels.
‘We’re rebuilding the plane while we’re flying it.’ CMO of Challenger organisation
Progressive Profile Progressives are the most effective at delivering on all five of the key indicators of customer centricity. Progressives rate highly across all measures, particularly securing leadership support, demonstrating performance and securing resources but there is still room for improvement in leveraging data, particularly enhancing and enriching through integrating more third–party data. Third-party data provides a deeper understanding of customers, their behaviours and preferences and enables more accurate and targeted segmentation.
The challenges facing CMOs evolve as they progress on the journey however, resourcing (budgets and skilled talent), data quality and technology issues remain an ongoing hurdle. Regardless of what stage an organisation is in, the biggest source of anxiety for CMOs is balancing the delivery of customer needs while restructuring and implementing new processes and simultaneously maintaining ‘business as usual’.
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Prioritising Change – Evolve or Perish
The rapidly changing marketplace means the customer centric transformation has become an urgent priority. Increased competition and changing customer behaviour is forcing the hands of business leaders. A new wave of customer centric organisations, that are evolving with the customer experience embedded in the business model, pose significant challenges to more traditional organisations that are battling legacy structures and processes. This pressure is most keenly felt by Beginners and Followers. These organisations are responding to threats both from new competitors and from established competitors who have gained the front–runner advantage by moving quickly to prioritise customer centricity.
The companies with the most to lose are those that haven’t begun the journey yet. The gap between these businesses and the market leaders will continue to widen, making it more difficult to catch up and remain relevant.
Almost 60 per cent of Beginners and Followers cite market forces as the key driver of customer centricity whereas, the more mature organisations are being driven by the desire to respond to, and keep pace with, customer needs – Progressives and Challengers at 58 per cent and 60 per cent respectively.
‘The need to compete harder in an increasingly competitive environment for customers’ time, combined with the changing media landscape, has put the customer in control.’ CMO of Follower organisation
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Leadership – Securing C-level Support is Critical for Success
In piecing together the journey of Australian organisations, it’s clear the first and one of the most important steps is securing C-level buy in and agreement on the plan of action. Organisations that are more advanced have one thing in common: the CEO and C–level have embraced customer centricity and the organisational strategy is aligned to customer centric outcomes.
Signpost 1
Have the ear of the CEO Customer centricity works best as a top down directive and CMOs of Progressive and Challenger organisations advocate securing management support for customer centricity as a key early signpost on the journey.
Only 19 per cent of Beginners have management and C–level who are committed and active in the customer centric transformation compared to 69 per cent of Followers and 100 per cent of Challengers and Progressives (Fig. 1). Similarly only 12 per cent of Beginners have aligned their organisational strategy to customer centric outcomes, compared to 100 per cent of Progressives.
Fig. 1 – Organisational commitment to customer centric transformation Beginners
Followers
Challengers
Progressives
19%
69%
100%
100%
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‘If you don’t have the CEO on board, quit!’ CMO of Progressive organisation
How to get the ear of the CEO CMOs of Progressive organisations advocate taking the whole organisation, including the CEO, on a journey of cultural change. CMOs can use the voice of the customer to build that narrative but the most powerful mechanism to effect change is to speak the CEO’s language – profitability and ROI.
CMOs of Beginner organisations reported struggling to gain the support of the CEO and C-level. This can make the journey to customer centricity significantly more challenging and CMOs may be met with opposition at every turn. CMOs need to create a direct link between customer centric initiatives and the bottom line to get the CEO and C-level on board. CMOs of more mature organisations (Progressives and Challengers), have increased customer retention and customer loyalty by an average of 86 per cent and 78 per cent respectively. These results enable the CMO to effectively demonstrate ROI on customer centric initiatives. By measuring the lifecycle value of a customer and considering the impact of their long term engagement with the brand, the CMO can drive change and ensure the CEO and C-level stop and listen.
‘Effective change can only take place in a company that has senior stakeholders on board, budget allocated and measurement metrics in place.’ Andrew Black, General Manager, Experian Data Quality
Meet the CMO+ – The Architect for Customer Centricity
What does the customer centric CMO look like when aspects of the marketing remit are now embraced across the organisation? CMOs from Progressive organisations are positioning themselves as ‘knowledge champions’ and as a result are being elevated above the marketing function into a broader role, one that encompasses ‘everything consumer’ – the CMO+.
Signpost 2
Be the knowledge champion for ‘everything consumer’ The CMO+ is an expanded role with increased responsibilities and a growing influence across the organisation. They drive customer centric initiatives and are the knowledge champion for others in the C–suite, providing counsel to sales, logistics, operations and production. A CMO+ uses their influence to ensure the whole organisation is aligned to customer centric outcomes. This means that CMOs have become more influential– 63 per cent of CMOs reported an increase in influence in the last 12 months. Among CMOs of Progressive organisations the ability to effectively measure and report on success has a direct and positive impact on their influence within an organisation.
Of these CMOs, 81 per cent reported an increase in their influence over the previous year, with 85 per cent effectively measuring ROI for customer centric initiatives. This compares with 38 per cent of Beginners who say they are more influential, while only 8 per cent are effective at demonstrating ROI. The increased influence of the CMO+ has helped break down internal barriers. They are empowered to influence managers who are not yet embracing customer centric change, and play a key role in resetting corporate values and KPIs. Greater influence has also enabled CMOs to realign partners and suppliers to customer centric outcomes in order to get ahead.
How to be ‘everything consumer’ Many CMOs in Progressive organisations have an open line of communication with their customers. They do this by regularly reviewing customer tweets, listening to customer service calls or speaking with customers face-to-face in store to determine what is working and what is not.
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Getting it Right – Progressives Stay Ahead of the Game
CMOs recognise the need for self-improvement if they are to be successful in leading their organisation’s transformation. This realisation and actively developing new skills is common as CMOs work towards customer centricity.
Signpost 3
Broaden skills and invest time on customer centric activities CMOs have traditionally come from a brand and creative background while modern day marketing has more of a focus on data and insights. The new role of CMO+, along with the merging of marketing and technology, demands much more of CMOs.
While CMOs in Progressive organisations are more effective across all transformation initiatives, there are some key areas where they clearly excel.
Half of all CMOs in the less mature organisations rate themselves as “not very good” at customer centric initiatives and recognise the need for self-improvement if they are to successfully guide their organisations. Thirty-seven per cent of CMOs identified making better use of digital channels and insights and analytics as the most important next step on the journey toward customer centricity.
Accordingly, they are in a better position to understand ROI on customer centric initiatives and hence are more successful at securing the required budget and resources for ongoing transformation.
Progressive organisations are significantly more effective at using insights and analytics (customer feedback, customer co-creation and design, data analytics and big data) and creating measurement frameworks.
‘The merging of C-level roles means marketers are now more engaged in data and analytics than ever before.’ David Chinn, General Manager, Experian Targeting
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Investing Time Wisely – Sharpen Focus on Customer Centric Activities
The research shows success is usually commensurate with the amount of time a CMO invests in customer centric initiatives. CMOs of Progressive organisations are investing substantial time on customer centric initiatives as opposed to traditional marketing functions. Notwithstanding, CMOs are extremely conscious that ‘business as usual’ is important. Balancing the marketing need to drive sales with the customer centricity transformation is a delicate juggling act.
Unsurprisingly, the research indicates CMOs in mature segments are investing more time to effect change as well as to incorporate the broader remit of the role.
On average, CMOs spend 45 per cent of their time on customer centric strategy, however this falls to 35 per cent for Beginners and Followers, and increases to 52 per cent and 58 per cent for Challengers and Progressives respectively (Fig. 2).
Fig. 2 – Time spent on customer centric strategy vs. traditional marketing functions Overall
45%
Customer Centric Transformation – How Australian CMOs are Driving Change
Beginners
Followers
35%
35%
Challengers
Progressives
52%
58%
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Insights and Analytics – Getting Back to Basics
Organisations are collecting large pools of data, however their ability to understand and interpret this data is proving a major stumbling block. The ability of CMOs to harness data and analytics is an accelerator along the CCMI, but volumes of data are worthless if the quality is questionable. Forty-two per cent of CMOs of Beginner organisations are challenged by siloed data and a further 50 per cent struggle with poor quality data. Many organisations do not have integrated channels or segmentation analysis, and there is a lack of expertise in data enrichment, data linkage and data processing.
By listening and collaborating with customers and integrating communications channels Progressives are able to enhance data and deliver a more tailored and relevant customer experience.
CMOs in Progressive organisations are routinely collecting customer feedback (100%), integrating communications channels (85%) and using big data and analytics to improve the customer experience (77%).
How to ensure basic data is accurate The first step for CMOs is to get involved in the data collection process. Align with data owners across the organisation to understand the data collection process and how it can be improved. Next CMOs should encourage a central data-management strategy as it is the best way to ensure a single and complete view of each customer. CMOs should then find the right technology for the business. Data quality technology is widely available, however care needs to be taken in finding the right vendors that will work best for the organisation.
Customer Centric Transformation – How Australian CMOs are Driving Change
The final step is to monitor information over time to ensure its ongoing accuracy. CMOs can either use monitoring technology as part of their broader data-management strategy or keep track of campaign response rates, such as email bounce or returned mail, to get an idea of contact-data accuracy.
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‘For Beginners and Followers it’s all about harnessing first party data within their company and aggregating and centralising that data to better communicate with individuals. Challengers and Progressives have maximised first party data but they’ve hit a roadblock and struggle to get a more detailed view of customers without third party data.’ Jennifer Caravantes, General Manager, Experian Cross Channel Marketing
From Theory to Practice – The CMO+ in Action
Progressives and Challengers recognise the journey to true customer centricity is a long term investment and early adoption is crucial. They understand the business needs to strike a delicate balance between delivering services now while re-engineering its offer. ‘You’re not going to become customer centric in two to three years, or even five to six years. You need to think of it as a 10 year exercise.’
CMOs admit to feeling the strain of the long timeframes involved in an organisation’s transformation however, CMOs in Progressive organisations advocate a process of securing quick wins in the short term, while working towards long term goals.
CMO of Progressive organisation.
Signpost 4
Look at the big picture, but keep it simple and get some quick wins by using agile methodologies and embracing digital channels With customer centric transformation often requiring significant changes over long periods of time, quick wins are essential to demonstrate progress, particularly in the early stages.
More than 40 per cent of CMOs believe the pace of change is too slow, and many are embracing agile methodologies to accelerate the pace of change and secure quick wins. 42 per cent of Progressives use agile methodologies for quick wins, compared with just 11 per cent of Beginners.
‘There is a real appetite for quick wins because CMOs have been stung by long term plans for change in the past.’ Andrew Black, General Manager, Experian Data Quality
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Faced with tackling legacy systems and organisations embedded in siloed structures, many CMOs are looking to digital and mobile channels to provide quick wins. This is different for each organisation, however, social media, apps and mobile-friendly websites are all examples of a low-cost quick wins.
How to use social media more effectively Social Listening programs (which provide brands with regular reporting on relevant themes, brands and markets) and Social Enablement programs, where companies create social media profiles to engage with customers directly, are popular examples which deliver on customer needs and ensure the brand is competitive in the market place. Social Response programs, which address complaints and engage with customers directly in real time through live chat or custom–built apps, are another way brands can make large gains in understanding and addressing customer needs.
‘Live chat is a great example of a quick win implemented by many CMOs. As a strategy to improve customer service, live chat lets you address a problem before it escalates.’ David Chinn, General Manager, Experian Targeting
Data – a Key Ally of the CMO+
As CMOs progress, their use of insights and analytics becomes more sophisticated. This is most evident in a shift from Followers to Challengers – just 27 per cent of Followers are working collaboratively with customers to co-create new experiences, products and services compared to 72 per cent of Challengers (Fig. 3). In addition, just 23 per cent of Followers are using data and analytics to improve the customer experience compared with 52 per cent of Challengers (Fig. 4).
Fig. 3 – Organisations collaborating with customers
Fig. 4 – Organisations using data and analytics
Followers
Challengers
Followers
Challengers
27%
72%
23%
52%
‘Once you have your own data in order, the next step is to leverage third party data to gain a deeper understanding of your customer. Third party data is an effective way to enhance the segmentation and targeting process, enabling relevant, personalised and more engaging interactions with customers.’ Jennifer Caravantes, General Manager Experian Cross Channel Marketing
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As CMOs add more layers and complexity to their analytics they also unlock more data and insights. For example, combining the data from loyalty programs, demographic information and third–party data gives CMOs a greater understanding of the customer, creating a more robust picture to deliver targeted and relevant communication that will resonate.
Loyalty Programs
Demographic Data
Third-party Data
Customer Insight
How to make data work for you One of the best ways CMOs can respond to changing consumer demands is through addressable advertising. This means tailoring messages, content and offers to the lifestyles, mindsets and preferences of individual customers and prospects. The content is delivered through the channels preferred by the audience; when content is delivered this way, consumers will naturally lean in. Facebook is one example of this. It’s a rich data source and an effective advertising channel. However, the site is built on behavioural data its demographic information about users is not as strong.
By combining these data sets, organisations are able to create, design and tailor compelling content that is of most interest to the audience and deliver that content through the Facebook platform.
This can make it difficult to deliver tailored content to the most relevant audience. CMOs can now overcome this by combining their own data with an external consumer data product that includes demographic, financial and psychographic data and Facebook’s custom audience tool.
Customer Centric Transformation – How Australian CMOs are Driving Change
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Test, Fail and Progress
The lack of solid examples and case studies for customer centricity presents one of the biggest challenges for CMOs when it comes to piloting new initiatives. How does one ensure success when venturing into unknown territory? Developing and testing new customer centric initiatives can deliver quick wins but also increases the risk of failure. For Beginners and Followers there is a clear lack of acceptance of failure while in more mature organisations this is an accepted part of the transformation process.
In these organisations CMOs have used their influence to create an environment that accepts mistakes and failure as part of the journey.
Signpost 5
Use influence to create an environment that accepts failure The level of acceptance of failure is higher in more mature organisations, where management buy-in to the customer centric process has been established longer. There is a pragmatic view that if ‘business as usual’ is delivering results, there is more freedom to experiment with new initiatives even if they fail.
Fig. 5 – Level of acceptance of failure
‘Mistakes and failure are a part of business. It’s not how you fail, it’s how you learn from the experience.’
19% – A low level of tolerance
9% – No tolerance at all
100
80
60 CMO of Progressive organisation 50 per cent of CMOs of Progressive organisations believe their organisations are very accepting of failure when testing initiatives, compared to 24 per cent of Challengers and 12 per cent of Beginners. Interestingly it is Followers that are the least likely to employ a test and learn approach with 35 per cent of these organisations having a low tolerance of failure (Fig. 5). This puts these companies at risk of falling behind competitors because they haven’t created a culture of pushing the boundaries without fear of failure.
Customer Centric Transformation – How Australian CMOs are Driving Change
43% – Yes, a moderate level
40
20
29% – Yes, high level
0
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‘Adopt the Google philosophy of prototyping. Come up with small concepts and test them in a small market, learn from it, change it and implement it across the board. Not big broad untested solutions.’ CMO of Follower organisation
Measurement and Reporting
The majority of organisations are experiencing a positive performance change particularly in relation to customer loyalty and retention. It is critical that CMOs establish robust reporting and measurement processes to track customer centric wins and justify ongoing resources for the journey. This is something Progressives do well, with 92 per cent creating a framework for measuring the ROI from customer centric initiatives compared with the average of 42 per cent (Fig. 6).
Fig. 6 – Businesses creating a framework for ROI Progressives
Average
92%
42%
How to measure customer centricity Organisations are generally using a similar suite of measures to demonstrate the success of customer centric initiatives including; share of wallet, customer satisfaction, loyalty, customer effort and Net Promoter Score; operational measures: sales, conversions, retention and leads; and, fiscal measures: profit and revenue. Decide what is of most value to the business and measure those elements. Often CMOs fall into the trap of trying to measure anything and everything which can detract from process and overcomplicate the mission.
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Signpost 6
Ensure measurement metrics are directly linked to financial performance While a range of measures are used to report on customer experience, at the root of it, customer centricity is a means for ensuring business success, which means it is firmly couched in fiscal terms. When creating a measurement framework, while it is important that measures are linked to financial performance, they must move past traditional fiscal metrics to ‘lifecycle’ measures that demonstrate how customer centricity develops valuable long term customers. CMOs that focused on metrics such as customer retention (57%) and customer satisfaction (62%) were able to demonstrate to the C–suite how customer centric initiatives and measures supported business growth (Fig. 7). The research has shown mature organisations have experienced significant improvements in performance over the past 12 months across key measurement metrics including customer loyalty, customer retention, customer satisfaction, share of wallet, revenue and NPS.
Fig. 7 – Focus on customer centric initiatives
In addition to performing well across these areas Progressive organisations are also more successful at measuring ROI and drawing on these successes to secure ongoing budget and resources and test and grow long term customer centric initiatives. 88 per cent of Progressives state they have sufficient budget for customer centric initiatives, compared to just 8 per cent of Beginners. By measuring key performance indicators and securing quick wins CMOs are empowered to secure adequate budget and resource for customer centric initiatives (Fig. 8).
Fig. 8 – Organisations with sufficient budget
Customer retention
Customer satisfaction
Progressives
Beginners
57%
62%
88%
8%
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Conclusion
As customer behaviours and needs evolve and markets are disrupted customer centricity has become a high priority for most Australian organisations. Many are in the early stages of the customer centric journey, however there is an underlying recognition that the customer experience must evolve if organisations are to survive. Regardless of maturity level, businesses have significant day-to-day challenges when rolling out customer centric initiatives. What is clear, is that the risk of inaction is far outweighed by the opportunities customer centricity presents, particularly through customer retention, customer loyalty, and customer satisfaction. Organisations further along the journey have invested heavily in these areas in the past year and have seen a significant improvement in performance. CMOs can use these improvements to demonstrate a financial return on customer centric initiatives to get the CEO and C-level on board, an important first step on the journey to customer centricity. The modern day CMO must also act as an architect for customer centric change within their business and assume a more influential role, one that encompasses ‘everything consumer’. To do this, CMOs must acquire new skills, relating to digital channels, technology, data and analytics.
Although it may seem risky to invest in new customer centric initiatives, CMOs can’t be afraid to fail. Mistakes and failures are part of business and organisations with a low tolerance of failure put themselves at risk of falling behind competitors that are pushing boundaries. Although securing budget and resources remains a challenge at every stage of the journey, mature organisations are in a better position to understand and demonstrate a return on customer centric initiatives and are more successful at securing the required budget and resources. There will never be a definitive roadmap to customer centricity because the path is unique to each organisation. However, from the research, Experian has identified six common themes and practices that are critical to advancing an organisation through the stages of customer centric transformation.
CMOs of mature organisations are significantly more effective at using and understanding insights and analytics. The intelligence behind a brand’s interactions with customers will truly differentiate one from another in the mind of the dynamic, connected and empowered consumer. Brands that put the customer at the center of everything they do will be the winners.
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6 Effective Practices of Progressive Customer Centric CMOs 1 Have the ear of the CEO Executive commitment and support is critical to driving transformation so CMOs need the CEO’s buy in.
2 Be the knowledge champion for the ‘everything customer’ As the ‘market expert’, CMOs must assume an expanded, elevated and more influential role.
3 Broaden skills and invest time in customer centric activities
5 Use influence to create an environment that accepts failure Mistakes and failure is a part of business. It’s not how one fails; it’s how much is learnt from the experience.
6 Ensure measurement metrics are directly linked to financial performance When creating a measurement framework the metrics used should be directly linked to financial performance to demonstrate ROI.
To stay relevant, CMOs recognise a need to improve their skills across a range of disciplines, particularly digital, insights and analytics. With a broader remit, the CMO needs to invest significant time into customer centric activities, while also keeping a close eye on ‘business as usual’.
4 Look at the big picture, but keep it simple and get some quick wins by using agile methodologies and embracing digital channels Quick wins can often be achieved through digital integration and optimisation rather than getting consumed by legacy channels and systems.
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Experian Australia Pty Ltd. Level 6, 549 St Kilda Road Melbourne, VIC 3004, Australia T: (61) 3 8699 0100 F: (61) 3 9923 6280
[email protected] experian.com.au/marketing-services
Research Methodology Experian Marketing Services commissioned in-depth, exploratory research, in partnership with ACA Research, an independent research consultancy, to understand how prominent Australian CMOs are undertaking customer centric change. The research combined in-depth interviews with 20 of the country’s most respected CMOs with data from a survey of 103 senior marketers to create an exploratory report titled ‘Customer Centric Transformation: How Australian CMOs are Driving Change’. The report is the first in a series of four whitepapers. Follow us and join the conversation
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