A WHITE PAPER OF ACTITO
Survival of the most agile The new CMO & the digital customer journey
Agility The power of moving quickly and easily. The ability to think and draw conclusions quickly.
Content table In the long run, only the most agile survive
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The CMO's new tumultuous journey
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The internal obstacles to change in a digital world
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Agile customer journey management
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The agile building of marketing automation processes
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Agile marketing orchestration
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ACTITO 31
Authors Eric Godefroid, Director ACTITO BenoĂŽt De Nayer, Founder and Chief Product Officer ACTITO Editing Lien De Leenheer Responsible publisher Benoit De Nayer on behalf of ACTITO, a subsidiary of Citobi S.A. Avenue AthĂŠna 1, 1348 Louvain-la-Neuve, Belgium
In the long run, only the most agile survive
Many million years ago early humans evolved in such a way that the Homo erectus could take long strides and consequently walk farther and faster than his predecessors, outsmarting his peers. As environments changed, walking on two legs helped early humans survive by making it easier to pick fruits and other food from low-lying branches, freeing their hands for carrying food, tools, or babies, enabling early humans to appear larger and more intimidating and helping early humans cover wide, open landscapes quickly and efficiently.
‘Modern day marketers are now faced with the need to adapt quickly in a changing environment.’
Modern-day
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phones have become the first screen for the majority of consumers. At the same time marketing departments have to deal with ever more limited internal resources and cope with the proliferation of technologies and suppliers. So how does one survive in such a fast-changing environment? How do marketers and companies keep up with this pace of change? Not evolving is the first step towards extinction. Marketers have to reinvent themselves and try to be more agile. By adapting quickly to changing market conditions. By having the right assets to grow progressively and change direction quickly. All this while keeping the customer at top of their mind. This vision paper will not tell you which channels or trends are the go-to place in the years to come. We believe it would be a waste of your time. You need to focus on building and retaining your relationship with your customer and really understanding your customer to ensure your company’s survival in the next decade.
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"Focussing on building and retaining your relationship with your customer is vital for the survival of your company."
http://humanorigins.si.edu/human-characteristics/walking 1
The agility to follow customers wherever they are is the only way forward. That is the only survival skill that matters, while short-sighted trends are meant to die. ACTITO has embraced the very nature of agility since its inception, by creating a unique blend of technology and the people who drive it. This vision underpins the ACTITO Relationship Marketing suite: a set of agile tools built for marketers to help them manage the ever-evolving customer journey and to orchestrate marketing processes in a “rightsourced� marketing organisation. That said, we encourage you to surrender to the changing pace, accept it and grow with it.
Benoit De Nayer, Chief Product Officer ACTITO
IN THE LONG RUN, ONLY THE MOST AGILE SURVIVE
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The CMO’s new tumultuous journey The landscape of a company’s chief marketing officer (CMO) has significantly changed in recent years. Budgets are under constant pressure, (radically) new skills are required from the marketing teams while CEOs want their marketing departments to support profitable growth. It is hard to be a hero when you are keeping so many balls up in the air.
“We cannot direct the wind, but we can adjust the sails.” — Dolly Parton
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The pace of change is changing In the past centuries new disruptive technologies and concepts were launched every 30 to 50 years. In the new millennium the pace increased with disruptive technologies emerging every 5 years. We are currently living in an era where a new disruptive technology is launched almost every day. CMOs were not educated to cope with this kind of perpetual technological revolution.
The new digital customer journey Twenty years ago everything was much simpler: when we needed to buy something we just went to the corner shop. We picked up our stuff and went home. Things were simpler in those days for marketers. Brands just tried to demonstrate their value proposals through mass media –such as TV and radio - or, for the most sophisticated ones, through personalised direct mailing campaigns. The job of maintaining relationships with the customer - the most important part - was left to the local shopkeeper. Then came the Internet. We started comparing brands, specifications and prices before making a purchase, all from the comfort of our homes. In the mobile Internet age the shops are brought to us wherever we are. Social recommendation apps even tell us where we can find the best-rated shop in the area on the basis of our friends’ comments. And the buck does not stop here: after purchasing we cannot resist to show off our newest purchase in a Facebook update or a tweet, influencing our peers once again. All of these channels and touch points tell the CMO lots of things about their products and customers, but few marketers know how to leverage this knowledge.
Customer centric content In an increasingly technology-driven world customers expect brands to have a presence across different channels and provide them with a relevant and unique experience in each of these channels. In a society where time is very precious, a company that targets you with relevant customised content is very valuable. According to research by Captora 61% of consumers are more likely to buy from companies that create custom content, that literally “speak” to them at the right moment. But only a very limited number of companies are equipped to deliver such an experience to their customers. The answer to the needs of these new digital customers is to be customer-centric. Every CMO should ask their teams: “What triggers our customer’s buying behaviour? How can we guide our customers throughout their buying journey? How can we deliver 1-to-1 experiences to the customer?” Customer tracking and real time activation is the best survival tactic in such a fast changing market with so many competitors. It will come as no surprise that you will need data and technology to deliver on this vision. It is the only feasible way to track customer behaviour and deliver the right content to the right customer at the right time in their buying journey, in an automated manner.
THE CMO’S NEW TUMULTUOUS JOURNEY
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The internal obstacles to change in a digital world CMOs feel the internal reality is their biggest obstacle to being able to really develop powerful digital strategies. Their biggest worry is the silo thinking within the company, the lack of internal skills to deal with a digital world and the commonly accepted opinion that complex challenges require rocketscience solutions (spoiler: they don’t). Marketing procrastination A large majority of CMOs understand the value of customer-centric marketing but the task of getting their company on board seems daunting. Their internal dialogue is similar to this: “1-to-1 marketing means data. Data equals collecting data from hundreds of databases from different departments. This means it will be a big set-up, so I will have to ask IT to manage a complex CRM project. But I do not have the time for this. And they are probably fully booked too. Oh and what about the money? I will have to request new investments and the budget is already under pressure. I will have to convince the CEO and CFO that this is the only way forward. But they are still so conservative when it comes to digital. And where will I find the right people to manage all of this? I do not have the right people in my team yet. And what about my agencies? Our workflow has finally reached a good speed. Oh dear, maybe I should wait a few years before implementing our digital vision�.
Fairy tales and misconceptions Most technology vendors will try to convince you that the only way to achieve real 1-to-1 marketing is to combine all the data sources within your company before you embark on any serious project. Then wonderful magical things will be the result. But sadly, you will need a year or more to set up the project. And it will cost you a lot of money. CMOs often believe these stories because they cater to our fears of complexity. And these vendors have more experience with these processes. Correct? Wrong. The CMO knows his business, his products and his
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customers better than anyone. Vendors know their technology, period. Huge projects that take years to implement before delivering their first results are bound to fail. Moreover, did you know that most CMOs change jobs within 3 years? This means that you will never be able to see the results of a long set-up, and as a result you will not be able to showcase your business value either.
Silos and complexity Marketing departments must create consistent, multichannel experiences that meet customer’s needs, expectations and demands for relevancy. But these departments are often built as silos: one team manages the website while another launches e-mail campaigns. In order to address all the digital challenges CMOs are increasingly relying on external partners who are highly skilled to execute and deliver high-end digital experiences that support the increasing demand for profitable growth. Our experience shows that even the agencies are struggling with the technical demands of 1-to1 marketing automation. That is why a close collaboration between the CMO, marketing technologists and content agencies is vital for creating successful 1-to1 marketing automation. CMO’s must become experts in “rightsourcing”, which means insourcing external capacity and skills in function of changing needs.
Technology illiteracy Marketing is rapidly becoming one of the most technology-driven departments in companies. Gartner Consulting predicted that by 2017, a company’s CMO would be spending more on technology than its CIO despite the fact that most CMOs are, at best “naïve when it comes to technology”. In order to properly manage this transition, companies must create a new role, namely that of Chief Marketing Technologist (CMT). His goal is to align the company’s marketing technology with its business objectives. This individual most definitely is a marketer, liaising with IT and technology providers. A CMT is part digital strategist, part creative director, part technology evangelist and change manager and teacher. He or she pushes for more experimentation, more agile management and an analytics driven decision model.
THE INTERNAL OBSTACLES TO CHANGE IN A DIGITAL WORLD
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“Our mission is to achieve leadership in the retail industry in terms of 1-to-1 marketing. Carrefour is first and foremost a retailer. It means we need to sell and measure the ROI of our investments. ACTITO helps us achieve this. At Carrefour, we also expect a quick response from our suppliers. ACTITO has always been capable of delivering it. Extraordinary agility and a short set-up time. We deployed in just two months bearing in mind that Carrefour is a heavy structure.” VÉRONIQUE MARICHAL HEAD OF DIGITAL CARREFOUR BELGIUM
Agile customer journey management
For years the brand has led the relationship dance with its customers. It was all about pushing the brand message to the customer. Today, customers are in the driver’s seat. Major brands have still not understood that the customer does not want to follow the road that you have designed for them. They want to decide the dance and the pace. Your marketing should focus on detecting the right time to act and deploy your business strategy when the customer’s behaviour demands it. Today, the customer is in the driver’s seat. That is why a brand strategy based on 1-to-1 customer journey management requires a fundamental shift in mindset, a different skill set and new processes. Remember, the best way to meet the new digital customer’s needs is by delivering the right content, to the right customer at the right moment in their buying journey. Frankly speaking, the journey of today’s customer is largely unpredictable. You can throw away the AIDA funnel model because the new digital customer is moving in a non-linear way at high speed.
INTERACT WITH THE BRAND RESEARCH THE BRAND
BUY
BECOME AWARE OF THE BRAND GET HELP OFFER A TESTIMONIAL
LEARN
ADVOCATE TRADITIONAL MEDIA
GET A BRAND RECOMMENDATION SOCIAL MEDIA
The Engaged Customer Journey
Infographic © 2013 Dion Henchcliffe
Applying the old school marketing approach which consists of trying to track, understand and leverage the digital customer journey would be a complete waste of time. It is simply impossible to impose behaviour on a customer. You can, however, to subtly influence some of their interactions and, above all, give them a coherent vision of your brand across different channels. It is needless to say that the ancient concept of “marketing campaigning” is of no help here: defining a message that will be broadcast to an entire population or a segment will almost certainly have no tangible effect on customers as the message will generally miss the individual triggers of your targets. Automation is the only way to cope with the myriad of temporary events that occur during a typical customer journey. Rather than being targeted by mass campaigns, customers are closely monitored by automated marketing scenarios that adapt to their behaviour. For instance, if a consumer has visited your website and has asked a question about your product on a social network, he is most likely going to buy your product in the coming days. Timely messages containing a personalised message, amplified by retargeted banners that will finally convince him to buy this product with a high level of certainty. Generalised A/B testing will ensure that the most efficient scenario is used at any moment. Marketing automation can be used at any stage your
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AGILE CUSTOMER JOURNEY MANAGEMENT
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Where to start? The temptation is great, for any CMO, to move as fast as possible and to deploy customer journey management strategies at all stages of the client-brand relationship. At ACTITO we advise against this. This approach would almost certainly mean that your project will take years to implement and that you will spend huge parts of your already tiny marketing budgets on the wrong marketing issues. The choice should be made based on business priorities. More precisely, there are moments of truth where you can “make or break� the relationship with your customer: lead generation, lead management, welcome programmes and churn programmes. Just like there are moments of business leverage opportunities: crossselling and loyalty programmes. Your focus for example will be determined by how healthy your brand is doing globally (do you have a lot of churn?) or how long your brand has been on the market (acquiring new customers). The benefits of building as you go will be a mental focus, easily measurable results and a spread of investments.
Examples of customer journey management programmes Acquisition A prospect is searching for information about a product and during his navigation on the brand website and on social networks, a scoring system calculates that this prospect has a certain interest in a certain car model with certain specifications. A series of marketing scenarios are immediately activated. First, a realtime pop-up appears on his screen asking him some questions about his present car and his driving habits. These questions help to build a comprehensive customer profile that is then used to design an entirely personalised printed catalogue that he will receive at home. When the customer returns to the website after having read his own personalised catalogue, the models that are presented are consistent with what he has been presented on paper.
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Cross-selling A travel assistance company has deployed a road mapping tool on its website that allows customers to calculate the distance and the cost of the trip. When a customer uses this tool, the company detects that the customer is planning a trip soon. A cross-selling activation is launched, recommending travel insurance based on the destination country and the means of transport. A retailer makes a personalised selection of promotions based on the customer’s purchase history. Your customer has visited your e-shop, has starred a product or put it in the basket, but has not actually bought anything. Based on the propensity score matching (PSM) you make a decision about the likelihood that this customer will buy his preferred product. You send him an e-mail saying that he will receive free shipping or a 10% discount that is only valid in the upcoming days. If the customer is identified as a gold client, the system can decide to send him a printed coupon or a shopping list by ordinary mail to make him feel even more important.
Churn A health insurance company uses predictive data mining to assess the personal propensity of its customer to leave the brand and the potential risk factors: for example having a baby, retiring, etc. On a quarterly basis, a defensive 1-to-1 campaign is sent to high-risk customers, presenting the right brand arguments to correct the perception or the risk.
Loyalty In a loyalty programme with individual cards, a retail chain activates its customers in different ways based on purchase behaviour and RFM segment value (Recency, Frequency, Monetary). A scenario has been implemented in such a way that different lifetime values lead to different contact plans and different giveaways. Any movements of frequency versus the historic frequency are identified on the personal level, triggering a personalised e-mail or paper mail containing a promotion, proportional to customer value, so you can bring the customer back to his or her historic frequency.
AGILE CUSTOMER JOURNEY MANAGEMENT
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“We knew what we wanted but we had no idea how to achieve this. ACTITO’s dedicated team has been with us throughout the entire development and implementation of the project, taking risks with us, evolving and responding rapidly to new needs. ACTITO is a mix of strategy, field operational support and technological agility. Our collaboration has evolved into a real partnership between us and them.” YVES CARBONNELLE MARKETING DIRECTOR GENERALI BELGIUM
“20% of the data you own about your customers explains 80% of your customer’s behaviour and contains 80% of the business leverage effect. The problem of course lies in determining the 20% that matter.”
The agile building of marketing automation processes: a question of methodology In an age of perpetual change, large-scale marketing projects that require several months or even years to implement are no longer the solution. New approaches inspired by agile development methodologies offer a better answer. It is impossible for a CMO, regardless of his skills, to draw up a blueprint of his operational relationship marketing requirements for the next three years. Why? Because you have no idea yet whether you are building a wooden chalet or a castle. And even if you needed a castle you would not be able to describe your exact requirements as you have never lived in a castle before. We strongly believe that starting small, building as you go and showing results within the first weeks is the right way to set-up your 1-to-1 customercentric processes.
Start small and evolve on-the-go What do you do when you try to solve a complex problem? You divide the problem into various parts, without losing sight of the final objective. This is much easier. As for the more complex parts, you will progressively tackle them after having solved the easy parts. The right methodology is critical for your survival. If you try to create customer journeys with a blueprint and “elephant” projects from the outset, you might end up with a “mouse” in terms of operability and return. We believe continuous technological agility and progressive building are the way forward for marketers. There are three crucial phases in an agile approach: agile customer journey management, agile building of marketing automation processes and agile marketing orchestration.
THE AGILE BUILDING OF MARKETING AUTOMATION PROCESSES: A QUESTION OF METHODOLOGY
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Be smart about your data Are you worried about having to combine all your company databases? This is a frequently made mistake that is fuelled by an IT-perspective on data: the storage of all the customer data in one centralised place. This is actually the worst thing you can do when you want to see quick results from your 1-to-1 marketing strategy. Because at this point you have no idea which data are crucial for understanding your customers and drive sales. Striving for completeness will result in you getting bogged down by the complexity of it all and your first campaign will only leave the building more than a year later. Customers have become used to receiving mass communication or segmented communication based on a very small set of data. Some technology vendors try to convince CMOs that they need to instantaneously shift from this situation to a “Matrix-style” world in which every bit of data in the world is combined in the computer’s memory. We believe that there is an in-between approach to data, which we call “smart data”. The “smart data” approach is based on the assumption that 20% of the data you own about your customers explains 80% of your customer’s behaviour and contains 80% of the business leverage effect. The problem of course lies in determining the 20% that matter. Our experience is that, when studying specific industries, the principal vectors of customer behaviour are of the same nature. In some cases, the conclusions may sound counter-intuitive. For instance, we have observed that the weather predictions in the area where the customer lives are one of the most important factors that influence his decision to buy grocery goods. This is what we call the “BBQ effect”: the content of shopping baskets on Thursdays is often decided in function of the weather that has been announced for the weekend. But, more than “recipes” that would be applicable to every domain, marketers need a methodology to select which data are important and which data are irrelevant for their specific business needs and their specific customers.
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Working with pilots The idea behind the agile development methodology is to work with small cycles called “sprints” (usually fifteen days) so that the project’s evolution can be showcased to the users before development continues. ACTITO has adapted this approach to marketing automation by working with pilots. A pilot takes approximately twelve weeks (longer than a typical “sprint” but much shorter than a traditional marketing project). In this period, various hypotheses about data, which segments, which channels to use and KPIs are developed and applied to a portion of your target base. If these hypotheses prove fruitful, they are applied to the entire customer base and structured into automated processes to achieve a systematic return. Any further enhancements to your automation also follow the 12-week pilot rule. This obviously reduces the risk that is inherent to ambitious marketing projects. The added bonus of this approach? It is easier to defend your 1-to-1 vision to your CFO and CEO knowing that you will not spend a whole year’s worth of marketing budget on something that does not work. Assessing best practices and demonstrating ROI always seals the deal when requesting additional investments. As your company’s experience with 1-to-1 grows, you will identify the best practices that help you generate proven ROI at key moments of contact. This is agility at work: build structural processes brick by brick, like a wall. In the end the CMO can be certain that the size of the wall will be proportional to the generated business ROI.
THE AGILE BUILDING OF MARKETING AUTOMATION PROCESSES: A QUESTION OF METHODOLOGY
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“We were looking for a partner to manage our challenges. Above all, we were looking for men and women capable of speaking and explaining things in a simple way, knowing that CRM can be quite complex. Customer journey management has evolved in line with our progressive brand and organisation maturity.” THIERRY BOURETZ MARKETING DIRECTOR KIA FRANCE
Agile Marketing Orchestration
Marketing organisations have to continuously rearrange themselves to overcome the challenges posed by digital technology. Cloud-based tools and agile processes facilitate a “dynamic rightsourcing�. Ultimately the aim is to adapt quickly, reduce costs and improve output. Because companies are increasingly forced to outsource marketing specialties, the need to efficiently organise the collaboration between in-house and external marketing teams is more important than ever. This is no longer just a bilateral collaboration between a CMO and his agency. Given the increasing complexity of the marketing landscape, the need to involve more and more specialists for specific tasks has also increased. How can this chain collaborate efficiently? Cloud technology facilitates an easy agile deployment of marketing tools to all users. For instance, ACTITO offers a personalised user portal that makes it easier to share marketing tasks with every stakeholder, in such a way that every user only has access to the data and the tasks that are important to fulfil his mission. The CMO can keep an eye on the ROI through made-to-measure dashboards, the marketing coordinator can track campaign management execution, the CRM team can upload the data needed for targeting and the content creators such as the agency, copywriters or translators fill in the campaign templates with relevant content. Where applicable, custom applications can be developed, using the ACTITO platform, to perfectly match the needs of demanding users or to further simplify processes. By reducing the learning curve of every stakeholder in the marketing organisation, ACTITO helps to dynamically reconfigure the roles in order to cope with evolving needs.
AGILE MARKETING ORCHESTRATION
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Distributed marketing: think global, act local As companies grow, they tend to centralise marketing functions with the risk of being cut off from the customer at local level. Agile marketing organisations must develop strategies to bring local players back in the equation. Headquarter-based marketers face a specific challenge: getting the message to their local colleagues across the local distribution network. They have to be strict about the brand and legal messages, while still leaving their local colleagues the flexibility to add their local knowledge – which is also very important - of the end customer to the mix. Agile marketing organisations manage the stretch between these global-local requirements, allowing a brand to implement its global vision on the right level. They must become “glocal”. “Glocal” companies must integrate the added complexity of dealing with non-marketers to achieve their goals. Sometimes local marketing programmes need to be deployed by non-marketing collaborators (for example insurance brokers, car dealers, bank agencies, retail franchisers, etc.) Again, a cloud portal with a simplified interface, which has been specifically developed for these local marketing tasks, can help achieve these goals. ACTITO Localizer offers an agile solution for these companies. For instance, in an Insurance company, with hundreds of brokers, a personalised portal allows local associates to create their own local marketing applications. The marketing materials are supplied by the headquarter organisation and distributed through a personalised portal, where the local marketer can use his own data sets based on regional filters in the customer database. They can edit smart 1-to-1 branded templates to produce their very own materials. ACTITO ensures real-time material layouting while a made-to-measure approval flow guarantees that every message is approved by headquarters. This set-up reduces the time-to-campaign from six weeks to two weeks, while substantially reducing the costs at the same time.
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“Your relationship with your customer is what will create business value.”
ACTITO, the agile Relationship Marketing Suite
At ACTITO, we eat, breathe and live agility, for the marketers we serve. We think that marketing technology is here to help people, not vice versa. That’s why ACTITO is built for the new agile marketer. Customer centricity is the cornerstone of our philosophy. Your relationship with your customer is what will create business value. Hence our baseline “Return on Relationships”. Every project, every partnership, every new development will revolve around the value creation for the end customer and the business return for your company. Because ultimately doing business is your main objective. We believe that smart marketers make decisions based on demonstrated results. That is why we believe in iteration, working with pilots from the start and doing so each time you take your 1-to-1 marketing to the next level. We believe in the cloud. It is the best way to guarantee fast set-ups and the easy deployment of marketing technologies that will help the marketer seize all the available business opportunities. It is also the best way of collaborating with your agencies, your local branches and even the colleague sitting next to you. That is why ACTITO is 100% cloud-based since its inception. We are convinced that you will not be satisfied with off the shelf software, which is why ACTITO offers unique possibilities to create custom marketing solutions on top of our marketing platform. From iterative strategies to iterative implementations, we are partners for the CMO, his team and his agency. Your dedicated team of 1-to-1 ACTITO experts is continuously available on demand. They are an extension of your team, supplementing the skills you or your agency might need. Our goal is to facilitate your entry in the era of agile relationship marketing, on every level.
Eric Godefroid Director at Actito
ACTITO, THE AGILE RELATIONSHIP MARKETING SUITE
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ACTITO Avenue AthĂŠna 1 1348 Louvain-la-Neuve, Belgium www.actito.com