In the age of the empowered customer, many marketers claim to be customer-centric. But findings from a recent IBM study paint a picture that is drastically different.
In Stepping up to the challenge: CMO insights from the Global C-suite study, IBM Institute for Business interviewed 524 CMOs to get a snapshot of the top challenges and opportunities facing CMOs today. The report provides important insight on what top-performing marketers are doing differently and how other CMOs can follow their footsteps.
The report identified 3 distinct kinds of CMO:
- The Traditionalists make up 37% of the CMOs that IBM surveyed and are “challenged by the data explosion, the growth in social media and the plethora of new channels and devices.”
- The Social Strategists (33% of those surveyed) have already built the infrastructure needed to compete in the social arena. These CMOs, however, haven’t yet begun to exploit the opportunities arising from big data.
- The Digital Pacesetters (30% of CMOs surveyed) are reasonably prepared for the data explosion and have a good handle on the social media landscape. These are the only CMOs who can be truly described as customer-centric, because they are getting the real-time insight they need to listen to their customers.
These CMO segments make one thing painfully clear: despite the buzz about customer-centricity, most CMOs are not there yet. The notion of a customer-centric CMO is still largely a myth.
If you’re wondering if your company is customer-centric, IBM’s report provides a lot of good metrics with which you can benchmark your own performance. Based on the findings and recommendations in the IBM report, here are the four habits of customer-centric CMOs.
1. They cement relationships beyond social media.
“Most CMOs still concentrate on sealing the transaction rather than cementing the relationship,” write the report’s authors. This approach is short sighted because digital tools have made it possible for brands to forge lasting customer relationships.
To change that, IBM encourages CMOs to create value for customers at every step of the customer journey. “Take particular account of the desires and behavior of digitally empowered customers and citizens,” says the report. “Don’t limit your thinking just to social.”
It’s understandable why many CMOs are focused on transactions: their KPIs are often tied to revenue and profit. But as the IBM report points out, the empowered customer expects more. To be truly customer-centric, CMOs need to engage customers in a way that builds long-term relationship and trust.
To be truly customer-centric, CMOs need to engage customers in a way that builds long-term relationship and trust. (CLICK TO TWEET)
2. They collaborate with customers.
Digital Pacesetters are “already collaborating with customers to a much greater extent than other CMOs,” according to the report. And these CMOs are reaping the rewards since companies that collaborate with customers are 54% more likely to be outperformers.
Collaboration with customers shouldn’t be a one-off project. The report advices: “Enable customers to share their experiences with you and with others in the customer community. The goal is to have a two-way dialog—which means relinquishing complete control of your brand, and giving the customer a voice in what your organization does and how it does it.”
Customer-centric CMOs use new technologies to involve their customers in every aspect of their business. Whether co-creating products with customers or engaging your community for upcoming advertising campaigns, CMOs have never had better options for getting continuous customer feedback.
Customer-centric CMOs use new technologies to involve customers in every aspect of their business. (CLICK TO TWEET)
3. They connect the dots.
Top CMOs look at the entire customer experience instead of focusing on just one channel. “Traditionalists and Social Strategists are primarily involved in developing apps…while Digital Pacesetters are more interested in creating consistent cross-channel customer experiences,” the authors write.
CMOs should work on delivering a more compelling mobile experience for customers, advises the report, but it also highlights the importance of an integrated approach. “Invest in integrated software to manage your relationships with actual and prospective customers and ensure you interact consistently with them, regardless of the channels they use.”
Connecting the dots also applies to customer intelligence. To truly understand their customers, CMOs should aim to use all sources available to them. “Integrate obvious sources of information (point-of-sale data, loyalty programs, etc.) with intelligence from other sources,” write the authors. “Use the insights you glean to inform a wide range of business and marketing activities, including building better customer understanding across the organization as a whole.”
While analytics and transactional data can provide important information about your customers’ purchasing behavior, it’s critical to also understand their motivations and deep desires. Customer-centric CMOs understand the value of understanding the ‘why’ behind people’s decisions.
Customer-centric CMOs understand the value of understanding the ‘why’ behind people’s decisions. (CLICK TO TWEET)
4. They use their increasing influence to advocate for the customer.
CMOs are getting more powerful in the boardroom as CEOs increasingly rely on marketing chiefs for insight. In fact, CMOs are now second only to CFOs when it comes to involvement in business strategy development.
Photo credit: Marketing magazine
But this increase in influence isn’t translating to better customer relationships. The report notes that there’s still a gap between CMO desire to engage customers and what companies actually do. “The only way CMOs can start closing the gap is by invoking their growing influence in the boardroom,” the report offers.
It’s not enough to have customer insight with you if you’re not bringing that into the boardroom. The challenge for CMOs is finding a way to use the customer insight they’ve collected to influence C-suite decision-making. The good news is that CEOs are willing to listen: in the same study, CEOs have indicated customers come second to C-suite in terms of the influence that they bring in shaping the company’s strategy.
While these four habits seem obvious, IBM’s study hones in on the most urgent challenges that brands need to address in their journey towards becoming a truly customer-centric enterprise.
If you want to find out if your company is truly customer-centric, check out our infographic embedded below to see how your company stacks up.