American Marketing Association
ama.org
March 2017
March 2017 No.
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table of contents AMERICAN MARKETING ASSOCIATION
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SEEN ON AMA.ORG
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ANSWERS IN ACTION • Snapshot • Core Concepts
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AMA INTELLIGENCE • The Middle Market • Marketers’ Confidence Index • Scholarly Insights • MBA Perspectives
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EXECUTIVE INSIGHTS
The Evolution and Awakening of the Modern CMO The CMO, after almost being left out of the corporate kingdom, is now moving ahead at breakneck speed. What’s next in the evolution of the CMO?
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• Gordon Wyner • J. Walker Smith
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CAREER ADVANCEMENT • On the Record • Personal Branding
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#OFFICEGOALS
Cracking the Culture Code
When HubSpot’s cofounder proposed Katie Burke become head of company culture, it sounded to her like a shortcut to unemployment. Instead, Burke continues to hold down both her job and what she calls “radical transparency” at the tech firm.
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The era of Big Data was a long time in the making, but there’s little doubt its impact has already been felt. Could the future of marketing jobs come…
Down to a Science Cover:
Photograper: Colleen Durkin. Prop Stylist: Jessi Sheehan FIND OUT MORE AT
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March 2017
Vol. 51 | No. 3
Letter from the Editor
American Marketing Association
Work is Changing
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n some ways, marketers’ day-today lives are the same today as they were 50 years ago. In other ways, things will never be the same again. You still think about customer needs, create new ways to reach consumers or hone a brand’s message. The difference is that technology now shapes every step of those tasks. According to Hal Conick’s deep dive into the evolution of marketing’s role in the C-suite, CMOs have had a rough go of it. University of Virginia professor Kimberly Whitler calls the CMO “the most misunderstood and frankly underappreciated” role in the C-suite. The tide has now turned, as marketers serve as financial analysts, mathematicians and human behavior experts. “Chief marketers have brought a new work ethic and a measurable backbone to the executive table,” Conick writes. According to Forrester, the best CMOs “earn the respect of fellow C-level executives by bringing a strategic viewpoint, exceptional measurement and analytical capabilities, financial management rigor and operational savviness to their role.”
Valarie Zeithaml Chairperson of the AMA Board 2016-2017 Russ Klein, AMA Chief Executive Officer rklein@ama.org Andy Friedman, AMA Chief Content Officer afriedman@ama.org Editorial Staff
Phone (800) AMA-1150 • Fax (312) 542-9001 E-mail editor@ama.org
In his exploration of how data science has changed marketing practice, Zach Brooke writes, “More and more companies are turning to marketers who are not just conversant with digital tools, but knowledgeable in the realm of Big Data—people who can drink from the fire hose of information to pin down actionable results of customerfacing decisions as well as tease out competitive advantages through a better understanding of targeted segments.” None of this is to say that people and culture don’t matter. Sarah Steimer spoke with HubSpot’s head of company culture, Katie Burke, to find out about how the company has changed the concept of a corporate culture: it’s less about perks, she says, and more about transparency and diversity. How has your work changed?
Molly Soat, Editor in Chief msoat@ama.org Michelle Markelz, Managing Editor mmarkelz@ama.org Zach Brooke, Staff Writer zbrooke@ama.org Hal Conick, Staff Writer hconick@ama.org Sarah Steimer, Staff Writer ssteimer@ama.org Vince Cerasani, Associate Art Director vcerasani@ama.org Advertising Staff
Fax (312) 922-3763 • E-mail ads@ama.org Sally Schmitz, Production Manager sschmitz@ama.org (312) 542-9038 Michael Gay, Account Executive mgay@yourmembership.com (727) 329-4421 Nicola Tate, Account Executive ntate@yourmembership.com (727) 329-4437 Jordan Berthiaume, Media Sales Representative jberthiaume@YourMembership.com (727) 497-6565 x3409 Marketing News (ISSN 0025-3790) is published monthly by the American Marketing Association, 130 E. Randolph St., 22nd Floor, Chicago, IL 60601. Circulation: (800) AMA-1150, (312) 542-9000 Tel: (800) AMA-1150, (312) 542-9000
Molly Soat Editor in Chief @MollySoat
POSTMASTER: Send address changes to: Marketing News, 130 E. Randolph St., 22nd Floor, Chicago, 60601-6320, USA. Periodical Postage paid at Chicago, Ill., and additional mailing offices. Canada Post Agreement Number 40030960. Opinions expressed are not necessarily endorsed by the AMA, its officers or staff. Marketing News welcomes expressions of all professional viewpoints on marketing and its related areas. These may be as letters to the editor, columns or articles. Letters should be brief and may be condensed by the editors. Please request a copy of the “Writers’ Guidelines” before submitting an article. Upon submission to the AMA, photographs and manuscripts will not be returned unless accompanied by a self-addressed, adequately stamped envelope.
Contributors
Annual subscription rates: Marketing News is a benefit of membership for professional members of the American Marketing Association. Annual professional membership dues in the AMA are $220. Annual subscription rates: $35 members, $145 nonmembers and $190 libraries, corporations and institutions. International rates vary by country. Nonmembers: Order online at amaorders.com, call 1-800-633-4931 or e-mail amasubs@ebsco.com. Single copies $10 individual, $10 institutions; foreign add $5 per copy for air, printed matter. Payment must be in U.S. funds or the equivalent. Canadian residents add 13% GST (GST Registration #127478527). Advertisers and advertising agencies assume liability for all content (including text, representations and illustrations) of advertisements published, and also assume responsibility for any claims arising therefrom made against the publisher. The right is reserved to reject any advertisement. Copyright © 2017 by the American Marketing Association. All rights reserved.
J. Walker Smith
Colleen Durkin
Smith is executive chairman of Kantar Futures, part of the Kantar Group of WPP, and co-author of four books, including Rocking the Ages and Life is Not Work, Work is Not Life.
As a photographer, Durkin has a wide range of commercial and editorial clients from Nike to Nylon. Based in Chicago but deeply rooted in all things everywhere, her photography and luminous spirit can be experienced around the globe.
Without written permission from the AMA, any copying or reprinting (except by authors reprinting their own works) is prohibited. Requests for permission to reprint—such as copying for general distribution, advertising or promotional purposes, creating new collective works or resale—should be submitted in writing by mail or sent via e-mail to permissions@ama.org. Reprints in quantity are available by contacting Kristy Snyder at Sheridan Reprints: (717) 632-3535. Printed in the U.S.A.
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An In-progress Look at Landor’s Trend Watch 2017 Report
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e’re in the heart of the first quarter of 2017, and the year has been anything but dull. Are 2017 predictions coming true? Marketing News decided to check on some of the predictions global brand consulting and design firm Landor Associates made in its Trend Watch 2017 report. We asked Stuart Sproule, Landor’s North American president, to elaborate on what exactly he expects these trends to look like.
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“Kidulting.” Is this a fad, and if so how far should brands go in embracing it? How risky is it to cater to millennials wanting to recapture childhood
experiences? Is there a chance it will blow over quickly while campaigns are still being developed or get some kind of blowback from people who don’t like the concept?
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Kidulting isn’t a fad, it’s a fundamental mindset shift. Millennials are growing up and dealing with new responsibilities— something common to previous generations—in a way that is far more communal than ever before. Instead of quietly coping with difficulties, millennials are outwardly voicing their struggles and actively rebelling against aspects of adulthood. Kidulting is a means of counteracting adult responsibilities
by letting millennials find mental space to cut loose. Kidulting is also more than mere nostalgia, and campaigns that solely focus on connecting millennials with their past will likely have a shorter shelf life. The longevity of kidulting comes from taking modern struggles, new interests and recent technology and combining them with a little bit of childhood fun. As with anything, there will always be a certain proportion of the population that isn’t a huge fan, but the popularity of kidult-focused activities speaks for itself.
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Do you know of any augmented reality initiatives ahead that are using
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this technology to be game changers?
opportunities for both B-to-B and B-to-C companies are enormous.
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GE recently announced its plan to implement AR in the manufacturing of some of its complex machinery components such as gas-turbine nozzles. The technology will allow workers to superimpose computer-generated images onto the factory floor and help them obtain precise measurements. Another example is CastAR, a Silicon Valley start-up, which will be launching a very interesting augmented reality entertainment platform in 2017. With the vast possibilities available, the
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Landor predicted almost every industry will begin using chatbots to streamline communications with customers and employees. It seems like there’s a big trend toward presenting as much as possible remotely with tech assistance. How should creatives, not tech people, take advantage of these trends?
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For designers, AR, VR and chatbots present a huge opportunity because they are
entirely new platforms and mediums for creativity. With AR and VR, designers have the ability to actually create new environments and universes, letting them abandon the constraints of reality in favor of a world without predefined rules. This means that designers can take risks and test ideas in ways they can’t on client work or in their day-today assignments. With chatbots there is an opportunity to take design beyond the visual, branding everything from voice and tone to word cadence and inflection. The auditory will start to leave its own mark much as colors, typography or symbols do in visual design work.
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The report notes some brands taking customization to a new level with mood marketing. How do you capture a signature mood? How do you ensure a signature mood translates into sales?
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When we think of mood marketing, we actually think of it more as an adaptive technology where the mood of the retail store customizes to fit the shoppers. So there isn’t necessarily just one signature mood—it’s about giving shoppers the experience they desire, which inherently gets them to stay in the store longer, translating into sales. But in thinking about a signature mood, retailers should approach it the same way they approach their larger brand. The strategy for the mood of a store should
bridge directly back to the guiding principles and foundational promises of the company. It should fit the audience it’s trying to attract, and it should be flexible enough to adapt to new technology and trends.
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Some consumers are experiencing decision fatigue, and brands are alleviating that with minimalistic package design. What elements should be first on the chopping block if brands choose strippeddown packaging?
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Consumers are looking for clear guidance on which products and brands to trust. The first elements brands should cut from packaging are anything non-fundamental to the brand’s differentiated positioning. Any images, icons or messaging that feels
redundant across the category— for example, words like “refreshing” on a face wash—create visual noise that distracts people from zeroing in on what makes the brand unique. Getting rid of the obvious is also imperative: We don’t need photorealistic water droplets to tell us that water is wet. Similarly, stacking up too many unique claims—even if they’re true— can dilute the brand’s positioning and leave consumers feeling confused. Only elements that are distinctive, essential and directly related to the brand should stay. Brands must be aware that the fewer elements there are, the more imbued with meaning they should be. Otherwise they risk leaving a sterile or generic impression.
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Can you talk a bit more about the changing role of
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the brand manager or CMO. In some respects, they have a lot less power than ever before, and it seems like they need to adapt to command the attention and
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love of the public. How do you do that nowadays?
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I wouldn’t classify them as having less power than before—
I think how they wield their power has simply shifted. Brand managers can no longer operate in a vacuum. Instead, they have to consider other people’s opinions and perceptions as a vital part of the brand conversation. In fact, in many ways the brand manager or CMO is even more important than ever before because they act as a conductor, helping the various internal and external players perform harmoniously. Without them, the entire thing would become a catastrophic symphony of noise. For brand managers, the key to successfully managing myriad communities is identifying them, understanding each group’s needs and responsibilities and using a flexible approach to empower each community to be involved and engaged. —Zach Brooke
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Tech Start-up Uses Marketing to Cut a Month from Talent Search A San Francisco start-up combined marketing and HR to cut through a noisy job market. In turn, recruiting time was trimmed by a month. By Hal Conick | Staff Writer
hconick@ama.org Goal The San Francisco Bay Area is extremely competitive when it comes to finding talent, especially in technology. The region is home to a bevy of forwardthinking companies, a cursory glance at which reads like the who’s-who of modern American business: Facebook, Google, Lyft, Uber, Twitter, Airbnb, GoPro, Cisco, Salesforce.com. The list goes on. The Mercury News reported in January that the number of jobs grew by 2.7% in 2016 in the Bay Area. The unemployment
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rate in the San Francisco-San Mateo area is 3%, the lowest it has been since April 2000. While this ground is fertile for employees, the basic economic law of supply and demand has made filling roles—especially those relating to technology—quite tricky for employers, especially lesser-known start-ups. This is the atmosphere with which Lindsey Dal Porto had to recruit a software engineer to 1-Page, a San Francisco-based start-up that markets software products to HR departments.
Dal Porto, former head of recruiting with 1-Page (she now works with RJR Partners as a senior associate), says all of the people best-suited for the engineer role were already employed, well-paid and consistently being barraged by messages from recruiters. The solution to finding the best and brightest talent possible was to bring in the marketing department and start thinking creatively. Action Bringing marketing into the recruiting process may soon become common at companies across the world. Matt Alder, who works in talent acquisition and innovation consulting at MetaShift and hosts the podcast “The Recruiting Future,” says companies now have to work harder to find and hire new talent. A 2016 Glassdoor report found that it takes $4,000 and 52 days, on average, to fill an open position, just north of 1-Page’s recruiting time before the beginning of its marketing-assisted campaign. In 2015, Glassdoor reported that 90% of recruiters said the market is candidatedriven, up from 54% who said the same in 2011. Candidate shortages and lengthy
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hiring practices were noted as the top two obstacles to hiring more employees. For this reason, Adler believes HR and marketing will be working much more closely together in the near future, an area he says many businesses are already experimenting with and finding success. Companies looking to coalesce HR and marketing resources likely want to do what 1-Page was looking to do: save time, cut costs and take some initiative in a crowded market. Dal Porto and the 1-Page marketing team defined five tenets to abide by: Put the candidate first, nail the intake meeting, optimize and automate the sourcing function, learn from other parts of the business and leverage the hiring manager consistently throughout the hiring process. Next, Dal Porto built a list of the candidates 1-Page wanted to pursue. Then, she and the marketing team drafted e-mails and selected optimal times to send introduction messages to perspective candidates. During the campaign, Dal Porto— working with the marketing team—was able to adjust the campaign by focusing the messaging, collaborating with the position’s hiring manager and changing who was being targeted midway through the campaign. These moves cut “not the right fit” responses by candidates from 7% to 1% during the campaign, she says, and allowed the company to focus on how they could sell candidates on the value of taking a job with 1-Page. Additionally, Dal Porto and the marketing team created a dedicated landing page for the role, giving prospective employees a more detailed job description. The pages were designed to be simple and show off additional benefits of taking the job, she says. When it was time to recruit, the team sent out five e-mails, alternating between the recruiter and hiring manager as the sender. Leveraging the hiring manager in e-mail communications was a key to the campaign’s success, Dal Port says. Sending recruits an e-mail that appeared in the inbox as from a hiring manager gave a personal touch in a world where candidates mostly receive e-mails from HR professionals.
“The messaging truly portrays a relationship between recruiter and hiring manager,” she says. “From a candidate perspective, this makes the opportunity all the more attractive and the recruiter all the more legitimate.” Dal Porto and the marketing team set two keys for success from the outset: Always reply to recruits, even if busy, and take candidates off the fivemessage campaign after they respond. Otherwise, “you risk revealing all” as far as automation is concerned, Dal Porto says, likely sullying credibility in the eyes of some prospective employees. “An important mantra to remember here is any response is a good response,” Dal Porto wrote in a blog post. Result Dal Porto says the results of the pre-campaign legwork put her in “total positive shock.”
Company
1-Page Founded
November 2011 Campaign timeline
The campaign ran during the summer of 2016 for about two months, with results coming in a month later. Results
The six-week employee search was cut down to two weeks; 24% of responses were positive; 60% of candidates said it wasn’t the right time but wished to continue conversations with 1-Page; 1% unsubscribe rate; 8.3% and 7.87% response rate to second and third messages, respectively.
answers in action
“To see multiple responses come in, in a matter of hours, was both exciting and overwhelming,” she says. “In the end, the amount of time we spent pre-campaign to get all of the candidates selected and uploaded into the campaign was still hours—even days—less than what the traditional sourcing and outreach model would require. This made the responses even sweeter.” Twenty-four percent of the responses from potential recruits were positive, Dal Porto says, and conversations were started with another 60% of candidates who said it wasn’t the right time to change roles, but became aware of 1-Page for the first time. The campaign also cut search time for an employee from six weeks to two weeks, Dal Porto says. The response rate was 26% for the software engineer job and varied from 21% to 27% for other open positions that used similar campaign framework. Additionally, the percentage of “please take me off your list” responses were under 1% of the total responses received, something 1-Page took as a huge win in cold-call recruitment. “It meant that our messaging was, for the most part, really well-done and sounded personal,” Dal Porto says. “At the end of the day, recruiting is about relationships, so this was a great way to begin any relationship with both interested and uninterested candidates.” Sending five e-mails paid off for the 1-Page team. The first e-mail, automated to be from the recruiter, saw a response rate of 4.89%, something of a dud. However, e-mails No. 2 and No. 3 from the hiring manager and recruiter saw respective response rates of 8.3% and 7.87%, giving the campaign a spark. Dal Porto says there was a 10% spike in positive, interested responses after an e-mail from the hiring manager. Dal Porto is tempted to say there will need to be a necessary marriage between recruiting and marketing, much of which is already in play through social posts and events. “Rarely is there a relationship between lead generation and recruiting. I see this happening in the future,” she says. m March 2017 | marketing news
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A New Cyber Threat The Methbot shook up marketers who once believed they were unaffected by cybercrime. Experts say industry-wide transparency and education can defeat the attackers. By Sarah Steimer | Staff Writer
ssteimer@ama.org
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arketers had a rude awakening to the effects of cyberattacks at the end of 2016 with the discovery of Russian hacking operation Methbot. The fraudulent activity had been costing them between $3 million and $5 million per day at its peak, unbeknownst to them. The attack strayed from better-known threats, malware and identity fraud. It’s likely to cause a fundamental shift in how marketers consider their role in preventing such losses. It will also probably change how they interact with
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their IT departments, according to Marie Hattar, CMO at Ixia. “Marketing traditionally has not collaborated with IT from a cybersecurity standpoint,” Hattar says. “IT has been someone to help them employ their tools and make sure they do a lot of the back-end stuff.” What comes next will be a combination of transparency by all parties in the online ad realm and increased education of marketers so they can act with more awareness and accountability, experts say.
Understanding Methbot The Methbot managed to avoid detection through an array of infrastructure, versus more traditional malware structures. Methbot operators used a distributed network based on a custom browser engine running out of data centers on IP addresses that were acquired with forged registration data. The operation used its servers, located in the U.S. and the Netherlands, to create nonhuman traffic directed to load webpages featuring video ads from major advertisers, mostly ones based in the U.S. Fake webpages were designed to trick advertisers into believing their ads were appearing on major websites, such as ESPN, CBS Sports and The Wall Street Journal. Digital advertising security firm White Ops first noticed the bot in September 2015 and responded with a quarantine and monitoring effort. The fraudulent activity became what is now known as the Methbot in October
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2016 when it began to aggressively scale and adapt. With the release of its report in December 2016, White Ops provided known Methbot IP addresses to advertisers, agencies and technology providers so they could block them and prevent their ads from appearing on Methbot inventory, effectively killing the Methbot’s fraudulent activity. “When we released the details of all of the IT space the Methbot was using, we actually coordinated the biggest industry-wide shutdown of a fraudulent operation ever,” says White Ops CEO and co-founder Michael Tiffany. “Within 24 hours the Methbot IT space was routed off the internet.” Tiffany doesn’t discount the possibility of seeing a similar or copycat threat. He says what caught his company’s attention and motivated it to get the bot shut down was when Methbot started specifically working in digital video. There was evidence of automotive lead gen scams much earlier, and Tiffany says it’s reasonable to think that this is a group that’s been iterating through a number of different models. “We might not see them pop up again in digital video targeting brand advertisers,” Tiffany says. “They might pivot to some other form of ad fraud.” Security Via Transparency The Methbot report from White Ops provided recommendations for avoiding similar problems in the future. Tiffany says marketers can make the crime unprofitable. “One thing that is becoming increasingly clear is this is a fight that takes diligence, but it is actually a winnable fight,” Tiffany says. “The way we win is by raising the costs to the bad guys and decreasing the profits. If we keep doing that, then at a certain point, ad fraud might be still technically possible, but if it’s no longer incredibly profitable, then it’s just not going to be attractive.” The Methbot takedown demonstrated one of the ways to do so, which is to take away the key assets. Methbot
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operators had the market value of millions of dollars; now they absolutely cannot use those assets for their crimes. In terms of decreasing profit, marketers must ensure a high level of transparency and quality control across every channel that they spend in. “We started several years ago in a place where transparency and third-party validation of whether marketers got what they were paying for was very nascent,” Tiffany says. “Now you can tell the world moved quite a bit because fraud went from something no one wanted to talk about—people were in active denial— to a place where some platforms and publishers are actually building quality guarantees into their sales pitch.” According to Tiffany, adding those quality guarantees means enough marketers have been putting momentum behind this issue that there’s competition for quality when it comes to marketing automation, programmatic advertising and other platforms. Independent validation may help hold everyone to the same standards of quality. “I think we’re headed to a very counterintuitive place where big platforms with major engineering talents and data science capabilities are actually able to invest a lot in the security and protections of their platforms as long as there’s an economic incentive, which means that in so doing, they’ll make more money or win more market share,” Tiffany says. “Because that’s starting to happen, now there are automated programmatic platforms you can buy from where you’re basically safer than a media plan that’s based on a wide number of direct buys.” White Ops research has shown that direct buys are not immune to fraud, Tiffany says. In fact, a lot of bot traffic makes its way into direct buys either because of unsafe third-party traffic sourcing or because of unsafe audience extensions. As programmatic players compete on quality and take a zerotolerance approach, there may be a higher level of assurance that marketers get what they pay for because traffic-
sourcing and audience extensions scams that affect direct buys won’t work. Proactive, Involved Marketers Hattar says marketers need to seek verification that they’re receiving the services they signed up for from service platforms. “Marketers should do a sweep across the board of all the different channels that they use, whether it’s social media, marketing automation or their advertising,” Hattar says. “They should actually reach out to a security professional in their IT organization and check whether they have enough measures in place and what themes or concepts to look for. I think most marketers are not that proactive.” Hattar says that until something like the Methbot surfaced, marketers didn’t know to be concerned. They believed programmatic numbers were accurate. She says programmatic advertising involves a lot of proprietary algorithms that were traditionally not disclosed to marketers, keeping them in the dark on how they derive impression counts and other methodology. “A lot more marketers want to know exactly where their advertising is showing up,” Hattar says. “The advertising piece gets a lot of attention because, typically, most marketing budgets spend a significant amount on it—anywhere from 20% to 50%, depending on market segment.” There needs to be an elevated awareness of cybersecurity, Hattar says, with companies taking an end-to-end look across marketing processes to determine if they’re secure. Hattar says she aims to understand her company’s security policy across the board, whether for the website, marketing automation or the programmatic aspects. “Raising that level of education is very important,” Hattar says. “For those areas that could be exploited, the more transparent they are in terms of the results or algorithms, what they’re doing, how they’re accounting for their impressions, the better and the less likely the data is incorrect or fraudulent.” m
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the middle market
Proactive Planning for Middle Market Talent Middle market companies tend to be reactionary in their talent-planning efforts, but a new report shows the impact of setting up a talent game plan By Sarah Steimer | Staff Writer
ssteimer@ama.org
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iddle market companies, not unlike small and large businesses, want the very best employees. Despite the obvious importance of getting strong candidates on their teams, less than half of middle market firms are currently implementing talent-planning strategies. A new report from the National Center for the Middle Market outlines the impact of having a solid talentplanning strategy. The report found companies with an annual revenue growth of 10% or more are significantly more likely than slower-growing organizations to say they perform very or extremely well at talent-planning initiatives, which include identifying critical positions and players within the organization and engaging senior and line management in the talentplanning process. “We think that this is probably going to be one of our most impactful white papers that we’ve done since the launch of the center,” says Doug Farren, managing director of the National Center for the Middle Market. “This is an issue a lot of middle market companies struggle with and we think it’s a topic that’s pretty evergreen.” Farren says talent planning goes beyond hiring efforts, that it’s an overarching process that encompasses a range of activities, including identifying key positions and talent within the organization, identifying high-potential performers and thinking about how to back-fill if important players leave.
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Status Quo The report from the National Center for the Middle Market and Vistage surveyed 400 C-level middle market executives who are actively involved in attracting and retaining talent for their organizations. Of those surveyed, more than 40% gave themselves a grade of “C” or lower for their talent-planning efforts. Farren says talent planning can be bottom-of-mind for many middle market executives. It’s something they deal with on more of a reactionary basis, rather than proactively. “I think that creates a barrier,” Farren says. Succession plans and employee development are often considered on an ad hoc basis. “It’s actually a series of activities that can be thought of cohesively,” he says. “As our data proves, companies that actually do that tend to perform better overall.” There are a number of key talentplanning activities the survey respondents say they aren’t doing as well, including identifying current and future skills gaps; lining up successors for critical, can’t-lose players and mapping the process for identifying and developing high-potential employees. The report also performed some segmenting within the middle market. Unsurprisingly, middle market companies making more than $100 million in annual revenue put more resources toward talent planning than those companies making less than $50 million in revenue. The challenges for middle market firms across the size spectrum often stem from linking the talent-planning process with the overall
company strategy as it pertains to growth, new product lines or expansion. Middle market businesses with private equity investment were found to be more likely to follow guidelines for talent planning, the report found, while many family-owned businesses keep the process relatively informal. Often when private equity companies invest in middle market firms, they bring a lot of processes with them, Farren says. “They could bring in a new leadership team, a new accounting system or a new supply chain planning system. But what they also bring with them is some of this talent-planning framework.” Creating a Framework The report offered some talent-planning solutions for middle market companies by way of the ABLE Framework. The framework includes a checklist that focuses on aligning talent planning with strategy, building processes to enable successful talent planning, leading by example and engaging the organization. The more activities a company undertook from the checklist, the greater their performance, the report found. “That is what drove the 10% or 15% difference in performance,” Farren says of companies that implemented seven to nine activities, made a plan around them and integrated them into the culture of the organization. Leah Burdick, vice president of marketing at talent solutions provider Hudson, stressed the importance of tying the company’s workforce plan to the business strategy and where it’s growing. She says employer branding can help generate excitement about working for an organization, and she recommends looking to competitors to see how they promote their talent-seeking efforts. “We recently did a global candidate study, and candidates said they look at the company website, the LinkedIn company page and Glassdoor before their first interview,” Burdick says. Nearly 99% look at the company website. “Even adding a ‘Why work for us’ page can make a difference. HR and marketing are getting together the way marketing and technology did 10 years ago.”
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the middle market
Burdick says it’s important to get marketing on board with talent planning and explain to them the competitive advantage for the company to hire “A” performers versus “B” performers. The company’s leadership needs to understand why talent planning should be a priority, Burdick says, and some companies could benefit from using a consultant to identify benefits, look at competitors and enhance the employer brand. Businesses can promote their benefits, leadership training opportunities, educational opportunities, mentoring and volunteer work or even showcase a day in the life of an employee by using their website and social media platforms.
Burdick recommends internal communication as a cost-effective way to find great talent, such as using the employee newsletter, putting up posters in the breakroom and offering an employee referral program with bonuses. Candidate studies suggest some of the highest-quality, longest-tenured employees come from other employee recommendations, she says. Anthony Martin, executive vice president of recruitment process outsourcing and talent management at Hudson, says having a pipeline or a talent pool to draw from is extremely beneficial, particularly those with transferrable skill sets. “Your competitors in the market or … channel partners you work with that understand your product or your service
ama intelligence
and your company culture, those types of organizations are good grooming or breeding grounds to bring talent into your company,” Martin says. “Make sure your HR department and the business managers are keeping a warm contact with some people they’ve identified as top performers or people they want to bring into the organization.” As the job market tightens up, Martin says having developed sourcing channels, can speed up the talent-planning process. “Talent planning is no different than an operational area or an IT area or a finance area,” Farren says. “It needs to be managed and the more you can put a process around it, the better the results will be.” m March 2017 | marketing news
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ama intelligence
marketers’ confidence index
Marketers’ Confidence Reaches an All-time High in 2017, but Room for Improvement Remains CMOs see opportunities to better quantify ROI, drive customer-centric culture, understand rapid tech changes and invest in insight analytics BY American Marketing Association
T
he 2017 Marketers’ Confidence Index rose by six points in the past year to 69 out of 100 possible points. However, 30% of marketers say they are concerned that their organization is not investing in the right customers. That figure is down 13% from 2016’s index. The Marketers’ Confidence Index, a biannual survey released by the AMA in partnership with Kantar Vermeer, measures marketers’ optimism about the U.S. economy expressed through organizational spending and growth. The survey also reveals 32% of marketers have lost confidence in their team’s ability to understand the ROI of marketing plans. That is 11% lower than in 2016 when the confidence was 43%, representing a sharp decline. Marketers’ confidence in whether their organization is investing in the right operating model is also declining. Only 25% of respondents felt their team had the right tools and processes in place, down 8% from 2016. “While the Marketers’ Confidence Index revealed optimism in several key areas, there are some critical concerns leadership teams need to address and cannot afford to ignore,” says Marc de Swaan Arons, CMO and executive board member of Kantar Vermeer. “With technology changing the way customers engage, we all must harness the power of data and analytics as part of an integrated marketing strategy for growth, profitability and differentiation.” The index also sheds light on areas where CMOs need to better prepare
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for the future, including knowing more about new digital technologies, insights and analytics and how larger
organizations can communicate as effectively as smaller ones. The areas marketers are most excited about include new digital tools to support social media, personalization, marketing automation and augmented reality. Marketers are also hoping to more effectively demonstrate the added value of their marketing initiatives, especially analytics, Big Data and innovation. “This study shows a major shift in how organizations are investing and spending their time,” says Russ Klein, CEO of the AMA. “While marketers hold a positive outlook on their industry and organization, and anticipate higher budget, they need senior leadership to know more about metrics and analytics for ROI and creating a customer-centric organization.”
Current Marketing Budget Distribution Innovation/ New Product Development
12%
Market Research/ Insights
Analytics
Product Maintenance/ Support (promotions, packaging)
16%
9%
8%
Creative (all channels)
23% Media Placement
10% 21% Sponsoring
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marketers’ confidence index
Other key insights from the latest survey include: • Of marketers under age 35, 86% are optimistic about the power and influence of marketing in their organization over the next few years while 56% of marketers age 56 and older feel confident. • Of marketers 35 and under, 78% are confident that organizations should be making investments right now; 59% of marketers ages 36 to 45 felt now was a good time to invest. However,
this growing optimism from younger marketers has not yet resulted in growing budgets. • Marketing budgets are ripe for growth. More marketers are expecting budgets increases in the next six months: 36% of marketers expect an increase, up 8% from Q2 2016. This is a contrast from January 2016, when 22% of respondents felt their marketing budgets would decrease. • Marketing budget allocation has remained stable, but 24% of
ama intelligence
respondents said they would reduce their media placement budget. But only 4% would cut their analytics budget. About the Survey The survey’s margin of error is +/4.7% at the 90% confidence level. The Marketers’ Confidence Index presents the findings of an online survey conducted by Kantar Vermeer in December 2016, among a sample of 304 marketers across the U.S. m
How confident are you that your organization’s marketing team....
Not Confident
Confident
Change vs. Jan 2016:
... has a clear and well-understood brand positioning in place to be competitive?
28%
48%
-4%
... has the right capabilities to be competitive?
25% 43%
-6%
... is doing the right things to drive growth?
29%
-5%
... is investing in the customers who matter?
30% 39%
-13%
... has a clear and well-understood strategy in place to be competitive?
32%
37%
-4%
... understands the ROI of marketing plans?
38% 32%
-11%
... has the right operating model to be competitive?
41%
-8%
40%
26%
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ama intelligence
scholarly insights
How Should Marketers Manage Data Privacy? By Kelly D. Martin, Abhishek Borah and Robert W. Palmatier
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arketers often hear that collecting and using customer data is an effective way to improve returns. They are told they can generate productivity and profit gains that give them a competitive edge. Following this advice, firms spend billions of dollars to capture and leverage customer data. Our research argues that while these efforts can be good for the firm, they can also increase customers’ data vulnerability and heighten their perceptions of susceptibility to harm from data privacy. Indeed, data collection efforts can have a dark side, and customers often express negative reactions to these practices. Firms, however, have little insight into the potential ramifications of customer data management efforts or how to prevent negative outcomes. Not all customer data applications are created equal. In our research, published in the January issue of the Journal of Marketing, we identify four distinct effects: • Data access vulnerability: The firm has access to the customer’s personal data. • Data breach vulnerability: The firm suffers a data breach. • Spillover vulnerability: A firm’s rival suffers a data breach. • Data manifest vulnerability: A data breach allows customer data to be misused, such as for identity theft. These distinctions matter because different types of data vulnerability have different effects on a firm. For example, if customers provide their personal information to Home Depot, they experience data access vulnerability; if Home Depot then suffers a data breach, the potential for harm becomes more salient to both its own customers and to Lowe’s customers, even if the customers are not directly affected by data misuse. Marketing applications for customer
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data use are not likely to go away, so it is important to address the uncertainty around them. A Framework for Understanding Data Privacy In our article, “Data Privacy: Effects on Customer and Firm Performance,” we examine how data vulnerabilities affect customers and firm performance and suggest ways marketers can reduce negative effects. In three complementary studies, we capture two beneficial practices from the firms’ current privacy policies: transparency and control. Transparency captures the extent to which companies explain their data use practices to customers, whereas control is the extent to which customers have some say in those data practices. These two elements effectively reduce all four types of customer vulnerability, they benefit firm performance, and they may prove to be the antidote to the myriad tensions surrounding customer data privacy. Our research program of experiments, an event study and a field study with real customers across 15 companies examine all four types of data vulnerability (access, breach, spillover and manifest) on both customer outcomes and firm stock returns. Key findings about data privacy include: Data Access Vulnerability: Customers were more likely to fabricate their personal information (10%), speak negatively about the firm (23%) and switch to a competitor (22%) when a firm simply accessed their personal data. We recommend that firms collect customer information intentionally. If information will not be proactively used and applied, marketers should avoid collecting it.
Data Breach Vulnerability: A data
breach reduced the affected firm’s stock value by 0.29%, averaging losses close to $12 million. For a severe breach (when more than 28,000 records were compromised), this effect was worse. Firms with low transparency (in the event study, transparency was evaluated by the extent to which data practices were explained to the customer in the company privacy policy) had a drop in stock price 1.5 times larger than firms with high transparency. Finally, low control (control was evaluated by the number of opt-outs provided to customers in the company privacy policy that allow them to control their data use and sharing) created negative returns of almost $11 million, whereas firms that offered high control suffered no effect from the breach on stock price.
Spillover Vulnerability: A data breach
at a firm’s closest rival decreased that firm’s stock price by 0.17% on average,
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scholarly insights
Citigroup, at the time of its 2011 data breach, had a privacy policy that was low on both transparency and control. When it suffered a breach, the damages were staggering, resulting in a loss of $836 million in value. [...] Citigroup might have saved about $820 million had it simply offered its customers high transparency and control. more than $8 million. As severity of the breach increased, it improved the rival firm’s performance. At low severity (less than 32,000 records compromised), the
net effect of a data breach by the focal firm on a rival firm was -0.7%; at high severity (more than 32,000 records compromised), the net effect reached +1.7%.
ama intelligence
Data Manifest Vulnerability: Making
a firm’s data management policies more transparent and providing customers with control over their data can suppress the negative effects of vulnerability on performance—even in extreme situations in which it is likely that a customer has been the victim of identity theft, fraudulent credit activity or other data misuse. How Should Marketers Approach the Issue of Data Privacy? Our research shows the best data protection practice includes high transparency and high control. Marketers may need a more tempered approach to managing customer data and analytics. These practices help marketers identify and better understand customers and segments, but they can also create vulnerability. We use actual privacy policies to understand how firms access, manage March 2017 | marketing news
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ama intelligence
scholarly insights
and communicate about customer data. Marketers need to know that customers are made aware of data practices in a firm’s privacy policy and that these practices do affect customer behavior. Data privacy practices are important for all firms. Considering our findings regarding spillover effects, even firms that don’t use customer data can suffer serious performance harms when a close competitor has a breach. In combination, transparency and control effectively mitigate vulnerabilityinduced harm on firm performance. Specifically, high transparency and control reduces the spread of negative word of mouth, deters switching and suppresses negative stock price effect. Citigroup, at the time of its 2011 data breach, had a privacy policy that was low on both transparency and control. When it suffered a breach, the damages were staggering, resulting in a loss of $836 million in value. Our analyses show that if Citigroup had employed hightransparency and high-customer-control practices, it would have suffered a loss
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of only about $16 million in stock value. That is, Citigroup might have saved about $820 million had it simply offered its customers high transparency and control. Importantly, when provided with high transparency but low control, customers across all studies perceive more violation and lower trust. In other words, it is a dangerous practice for firms to tell customers exactly how they will be collecting data but provide them little to no say over those practices. If customers lack control, they are left to worry about the various potential uses of their data— uses that have been made salient by their increased transparency. Knowledge alone has mixed effects as a vulnerability suppressor. Therefore, if firms intend to reveal data use practices to customers, they must provide them with some element of control over the practices. Alternatively, low transparency and high control creates a situation of uninformed autonomy. Customers have the ability to change their preferences, so they respond favorably, but their opt-in/opt-out choices are somewhat
blind. These contrasts suggest that providing customers with some level of control is a powerful managerial tool for generating positive firm outcomes. The amount of customer control provided might not need to reach full and total autonomy; rather, some level of perceived control may be sufficient to obtain the desired mitigating effects. By allowing customers to opt in or out of various data practices, marketers can promote overall willingness to provide personal information. Know Your Competitors’ Data Practices Finally, marketers need to be mindful of competitors’ data practices. A more severe breach helps rivals through positive competitive effects that overwhelm negative spillover effects. Marketers can avoid long-term harm by adopting proactive data management practices, especially transparency and control, for immediate benefits with their own customers and the ability to guard against privacy failures by competitors. m
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ama intelligence
mba perspectives
Creating the Ultimate Luxury Fashion Customer Experience While some brands are doing better than others, none has been able to deliver an harmonic customer experience that pivots on an omni-channel integration By Giuseppe E. Franzé
I
n retrospect, 2016 was not a good year for the fashion industry, particularly for luxury brands. Despite an overall growth of the sector, volatility in key markets (China and the U.S. above others) and instability due to sociopolitical events (such as Donald Trump’s election and Brexit) created a climate of uncertainty and fear that harmed fashion purchases, which are often highly emotional. Furthermore, a new class of more demanding and on-the-go consumers is emerging, making it more difficult for companies to predict purchasing behaviors. These trends are urging fashion brands to find new solutions to adapt to rapid shifts in consumer demand, accelerating the creation of more immersive customer experiences in stores. Studies conducted by Josko Brakus, Bernd Schmidt and Lia Zarantonello showed that the transformation of physical spaces into a multisensory experience is fundamental to evoke sensations, feelings, cognitions and behavioral responses generated by brand stimuli. However, immediacy and responsiveness are becoming paramount in an industry that is more dependent on instant gratifications, and the principle “See now, buy now” is gaining relevance. Digitization can help close the gap by creating those interactions between customers, brands and their products and building a community-based retail experience. Although the general consensus about the crucial importance of rethinking retail strategies in a digital landscape is important, many luxury
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fashion brands are afraid to experiment, fearing the loss of control and compromise over their brand image. Selling luxury products means selling a dream, which certainly goes beyond functionality. Rather, it emphasizes status and other symbolic associations, such as personal statement and identity, and creates a sense of belonging. While it is much easier to highlight certain unique characteristics in-store, translating a similar experience online becomes problematic. It is evident that e-commerce, being a space with few points of differentiation, threatens luxury brands, but staying away from digital channels is not the solution. How can luxury fashion brands deliver a “white-glove” customer experience and capitalize on the opportunities offered by online channels without risking depreciating their brand equity and losing sales that are mainly happening in stores? The answer is designing a customer experience that is well-integrated among all channels. As explained by Katherine Lemon and Peter Verhoef in their paper “Understanding the Customer Experience Throughout the Customer Journey,” brands need to understand the consumer decision journey throughout the multiple touch points and media that shape it and adjust their omni-channel strategy accordingly. To do so, here are three recommended strategies:
1
Integrate Digital Channels with Brand’s Heritage
As an example, Louis Vuitton is distinguishing itself through its in-store
experience by focusing on heritage, its most iconic products, a high level of customization and a clear separation of areas within boutiques to facilitate customer interactions with products. Nevertheless, despite a strong social media presence, the French fashion house is still reluctant to fully integrate digital channels within the customer experience, fearing a loss of consumers’ trust, which is ultimately
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mba perspectives
ama intelligence
do this, the number (and quality) of mobile/digital connections available in stores has to be improved. Moreover, a more tailored use of both offline and online tactics has to be considered according to the targeted country, city, and ethnic group. Luxury fashion brands have to create an in-store experience that is consistent with those offered on all other channels to deliver a superior customer experience aligned with the pace of modern consumers and brand DNA.
3
a lost opportunity. In contrast, while not maintaining the same level of detail within stores, Burberry believes in connecting the brand heritage with the growing digital mindset. The recent campaign “The Tale of Thomas Burberry” uses the events that shaped the brand’s history to excite consumers and educate them about the products’ peculiarities. The English brand is also tracing its roots when it comes to social
media (e.g., with Snapchat to preview the Spring/Summer 2016 women’s collection), live celebrity interactions and personalized tactics among different countries within the same region of the world.
2
Remove Omni-channel Inconsistencies
Luxury boutiques have to be reshaped to resemble the online experience. To
Put Collective Emotions at the Center
A coordinated use of digital and traditional channels has to be emotionally engaging. Luxury fashion brands should encourage positive feelings and moods that are commonly shared by customers who become interconnected through the brand’s aura. The ideal approach should combine consumer- and communitybased tactics by putting customers’ emotions at the center of the business strategy. Content and experiences will then be the glue between offline and online channels, pushing luxury marketers to become experiential and social media experts as well. This action plan should shift the conversation from “you” or “me” to “us,” creating a collective feeling. Brands will then become an active part of the most recent phase of the “democratization of luxury” that can be called “humanization,” in which the dialogue with clients and prospects will play a crucial role within an emotionally interconnected society. As shown by NetBase in its Brand Passion Report 2016: Top 100 Global Brands Love List, Louis Vuitton is the most-loved luxury brand on social media and its fans underlined the authenticity of the experiences with both products and brand as the key factor for their affection. By delivering valuable content and emotionally engaging experiences through an omni-channel strategy, luxury fashion brands can create the advocates of a community by emphasizing congruence between a brand’s values and consumers’ personality, a key driver of luxury market loyalty. m March 2017 | marketing news
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executive insights
professional development
Navigating a Marketing Career As the field of marketing evolves, marketers must consider how to acquire skills for an automated world and collaborative business environment
By Gordon Wyner
gordon@msi.org
M
arketers face some new and daunting challenges in planning a career. The marketing landscape has changed so rapidly and extensively that many of the traditional guideposts for the future simply don’t exist. The good news is that there are powerful new developments in marketing that present opportunities for practitioners at different levels. Navigating a career path in marketing requires careful consideration of what skills and capabilities to acquire and personal decisions about what context in which to apply them. How marketers make career choices depends on having useful information about the options. In the past they could rely on industry practice and stable job expectations for career progression. Now there’s sparse history and more challenges in identifying people and relevant information to assist the search for a career. Shifting Marketing Environment Fifteen to 20 years ago there were established jobs as product and advertising managers (and their supporting assistants), sales (heavily face-to-face) and channel managers (in-person, phone, retail), marketing researchers (mostly doing survey research and some behavioral tracking) and media buyers (TV, radio, print and direct mail). Only a few consulting firms had substantial marketing practices. In many roles career success could
24
be measured by taking on greater responsibilities for budgets, staffs and communication with top management. Fragmentation developed in many of these areas, along with increasing digital information availability and technical capabilities. Data-driven marketing, customer relationship marketing, customer value/ROI management and customer experience management emerged. New roles require more facility with data acquisition and analysis; more expertise in designing and testing new offers and messages; more understanding of the internet as a communication medium, sales channel, data source, app and social network environment. Wider understanding of communication formats (e.g. online video, mobile) became necessary. Changing Career Outlook As a result of these changes, there were more areas in which people were needed and, in the older roles, some reduction in needed people due to automation. There was less clarity about career options, paths, evaluation and compensation. New jobs were created in digital, social media, data science, analytics and e-commerce. Jobs that emphasized strategic market planning, managing large numbers of people and creating brand assets that have longterm value became less of a priority. Jobs that linked directly to revenue and profit impact increased in priority.
At the same time, over the last 20 years, agencies, service bureaus and consulting firms of various types have formed. The marketing process now involves many types of third parties to handle tasks that the primary company chooses not to perform directly with its own staff. The outsourcing of business processes leads to development of capabilities by these specialist firms and creates potential career paths for some. Looking ahead, automation is likely to take over more of marketing’s traditional functions when the tasks are repeatable and potentially programmable. For example, parts of the mediabuying process are being impacted by programmatic buying of advertising. Computer capabilities that enable networks to match large numbers of buyers and sellers have the potential to replace manual processes requiring faceto-face interactions. Choosing a way forward Marketers who are starting out in their career, as well as experienced marketers who need to stay current, ought to consider some common sense recommendations:
1
Think carefully about what formal training is needed. Most
levels of work in marketing will require some experience with handling data, whether in a customer contact role or a data management and analysis role. However, it’s not obvious that simply maximizing technical training is a good option. Artificial intelligence and robotics could make marketing jobs less dependent on the computer skills of users. While many current applications don’t operate smoothly (e.g., automated telephone marketing, some automated reservation systems, some e-commerce sites) these could improve performance over time.
2
Understand the trade-offs between pursuing a specialty (e.g., mastering a particular media application or type of customer contact) versus becoming a generalist who coordinates multiple
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professional development
executive insights
on the possible paths ahead and provide a long-term perspective on decision criteria. Finding appropriate role models will be harder to do since much of the marketing environment is new in the last five to ten years. Senior marketers who have worked in a particular role or at a single company probably won’t have as much value as a mentor as someone who has navigated between/adapted to different roles and companies.
specialties (e.g., coordinating research using multiple methods, data and analysis). Since new
applications are continually being developed, it behooves a specialist to have sufficient skills to be able to adapt to emerging technologies rather than lock on to just one specialty.
3
Invest appropriate time in managing your own personal brand, i.e., what to be known for, what expectations to set for prospective employers and what type of value to contribute to the market. This question ought to include
consideration of the type of business and place in the value chain of marketing. For example, the career choices would be different in a company that markets directly to end customers versus an
4
A potential mentor’s experience in a traditional command-and-control structure will probably be less relevant than experience in companies that have flatter organizations, exhibit more flexibility in their daily processes and make heavy use of information technology to run their businesses. Entrepreneurial experience may be quite relevant in a mentor. While fulltime entrepreneurship may not appeal to everyone, learning what it takes to manage one’s own brand in different contexts, over time, may be crucial. Given the availability of information on people and careers, marketers ought to consider ways to leverage technology to find relevant career advice. One way to use the tools is to more effectively find a mentor with relevant experience. Social media platforms, such as LinkedIn for professionals, are used heavily by the human resources and search industries for candidate recruitment. Presumably the databases include people with the ideal qualities to serve as mentors, if only they can be found. Another way to leverage the technology is to use data to understand alternative career paths, by the actual behavior of people in terms of their companies, roles and progression over time. Data can create an understanding of what’s been happening in the field in recent years. Digital tools like recommendation engines can support decision-making. Perhaps technology may complement and even substitute for some of what the human mentor can do. m
Experienced people often have several mentors who provide some guidance
the Marketing Science Institute.
agency or service firm that provides value to marketers. The boundaries between all these types of companies have changed a lot in the past 20 years. Frequently there are calls for collaboration of different agencies (including companies that are competitors) to support a particular company. Terms like “ecosystem” and “frenemies” capture the theme that roles between companies don’t easily fit into the traditional categories of vendor, supplier and customer. The people within these firms need to know how to relate to other firms in new ways. Plan to acquire information that will help with career management going forward.
GordoN wyNer is research director at
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executive insights
polling
A Question of Uncertainty The fatal flaw of polling is the unasked question
By J. Walker Smith
jwalker.smith@kantarfutures.com
P
olls can’t be blamed for not answering a question that pollsters didn’t ask. The hue and cry over presidential election polls getting the outcome wrong has yet to consider whether the polls were focused on the right questions to begin with. Researchers should have been polling about uncertainty. That was the driving force of this election. As the election cycle unfolded, it was widely thought that this was an election about change versus continuity. Only a few observers realized that this was an election about uncertainty versus certainty, which is to say, change that is completely unpredictable versus change that is highly calculated. It’s no surprise that researchers didn’t bother to ask a lot of questions about uncertainty. Generally speaking, people run away from uncertainty, not toward it. It is hard to imagine that anything involving substantial uncertainty would be attractive to many voters. Yet, this was an election decided by the eager embrace of uncertainty by a key bloc of voters. This is not to let pollsters off the hook for bad polling methodology. It is only to note that bad pollsters have a short shelf life in the highly competitive business of survey research. Quality control is not taken lightly. Monday morning quarterbacking of all the amateur mistakes that professional pollsters made is gratuitous speculation that won’t sort out what happened in this election. The Achilles’ heel of polling is not the much-studied error of sampling or measurement, which pollsters deal with successfully day in and day out. Instead, it is the question not asked. Surveys have a long track record of accuracy and utility, as long as the right question is asked.
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The last time survey research got splashed across the headlines was 1985, following the failed launch of New Coke. Executives at Coca-Cola were caught flat-footed by the public outcry because their research showed that consumers preferred the taste of the new product. Coca-Cola executives weren’t wrong about that. Their mistake came from the question not asked. The director of research at the time acknowledged that they “goofed” in failing to make clear to respondents that the current Coke would be taken away and replaced by New Coke, not just that a new Coke would be added to store shelves alongside the current product. In other words, consumers were asked only how they would feel about a new Coke, not how they would feel if a new Coke meant the removal of the old Coke. Researchers at Coca-Cola took for granted that the former implied the latter, but in doing so they fell prey to the question not asked about the sort of change they were planning to make. In this election, the question not asked by most researchers was a lot like the one not asked about New Coke. To all appearances, this election was about change versus continuity, so pollsters zeroed in on that. Yet, as with New Coke, critical nuances about change were overlooked. What went unasked was whether people would be willing to vote for change even if doing so meant living with a great deal of uncertainty about the future. Uncertainty is fearsome. Usually, people avoid rushing headlong into uncertainty. So from the start of this election cycle, it was hard to give much credence to the viability of Sen. Bernie Sanders and then-candidate Donald
Trump because it was presumed that people would turn away from a blind leap off the cliff of change. This was a bad assumption. The question to ask was not whether people wanted change but whether people believed that change requiring a great deal of uncertainty was the only thing that offered them hope. In all likelihood, Hillary Clinton campaign polls found that many people feared the prospect of being ferried through change by a volatile and unpredictable leader. Clinton’s strategy in the final weeks was to underline the uncertainty of what Trump represented by questioning his fitness for office. It was a gamble that people preferred the continuity of the incremental, dispassionate and predictable change Clinton offered. As it turned out, in the critical states where the election was decided, the majority embraced uncertainty. They voted for change so radical, so transformative and so revolutionary that they could not be certain about where
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Martech
it would take them. In the eyes of these voters, however bad uncertainty may be, it has to be better than the status quo. So they ran towards that cliff. Large numbers of Americans fear a lack of change more than change. They feel stuck on a continuing trajectory of decline, and they fear there is no change in that. They have lost faith in their prospects. For them, no change means things get worse, not that things stay the same. Many Americans have lost their fear of change because continuity offers them nothing to lose. There is no downside to uncertainty, so they are willing to go with it, wherever it takes them. The lack of confidence many people feel in the trajectory of the future is palpable and clear in the research of every organization that has polled about it. A larger number of people see themselves lumbering through zombielike prospects. In the depths of the early1980s recession—the worst prior to 2008—a 1981 Roper survey showed that a plurality of 49% over 40% believed we
had yet to see our best times. A similar 2014 Pew question found a complete reversal, with a plurality of 49% over 44% believing that our best days are behind us. Hope and change won two elections for Barack Obama, but as many observers are now realizing and reflecting upon, the change promised never showed up for lots of voters. Disappointed Rust Belt Democrats who supported Obama turned toward uncertainty and cast deciding votes for Trump. Regardless of the uncertainty about where a vote for Trump might take them, these voters found hope in it. There were hints that people were ready to welcome far-reaching uncertainty. Some pollsters did ask about uncertainty, but these portents were ignored or underappreciated. In a 2016 Quinnipiac poll among registered voters, 64% agreed “radical change” is needed; among Republicans alone, 71% agreed. In a 2014 Heartland Monitor poll sponsored by The National Journal and Allstate, 70% agreed “major changes” are needed. Most
executive insights
telling was a 2016 PPRI poll conducted for The Atlantic during primary season in which 45% agreed that America needs a leader “willing to break the rules if that’s what it takes.” That figure was 65% among Trump supporters. Nothing is more radically uncertain, more a snub to continuity and predictable change than to welcome breaking the rules. Change was a given in this election. The question survey researchers failed to ask was whether people would be willing to live with uncertainty in order to get change. Even with the election in the rearview mirror, that is surely the question that still needs to be asked, for the limits of the uncertainty with which people are willing to live will fix the outer limits of how far change will go over the next four years. m J. Walker Smith is executive chairman of Kantar Futures, part of the Kantar Group of WPP, and co-author of four books, including Rocking the Ages. Follow him on Twitter at @jwalkersmith. March 2017 | marketing news
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Th e
Ev o l u t i o n
a nd
Awa k e n i n g
o f
t h e
M o d e r n
CM O
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marketing news | March 2017
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The CMO, after almost being left out of the c o r p o r at e k i n g d o m , is now moving ahead at b r e a k n e c k s p e e d . W h at ’ s n e x t i n t h e evolution of the CMO?
By Hal Conick
March 2017 | marketing news
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M arketing
i s
n early
as
as
old
hum anity
W h e n o u r e a r ly a n c e s t o r s b e g a n working together outside of t h e fa m i l y c o n s t r u ct, t h o s e w h o
i t s e l f.
thrived honed their skills in a u n i q u e c r a f t o r c r e at e d n e w c u l t u r a l t e c h n o l o g y. I f t h e s e l at e s t w r i n k l e s w e r e u s e f u l f o r others–or perhaps if they were att r a ct i v e l y pa c k a g e d – p e o p l e w o u l d t r a d e s o m e t h i n g o f va l u e f o r t h e m . T h i s , at i t s m o s t b a s i c level, is marketing 101. T h e m a r k e t e r awa k e n s In the post-WWII era, marketing underwent a “great awakening,” according to a blog post by D. Steven White, a professor of marketing and international business at University of Massachusetts Dartmouth. This period was typified by companies bringing tasks like public relations, sales and promotions under one corporate umbrella. Later, from the 1960s to the 1990s, marketing was no longer left solely to the departments; it became a company-wide initiative, from the CEO to the mail clerks, all in the name of customer service. “The customer became king,” as White put it.
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The marketer’s spine s t r a i g ht e n s In the 1990s, White argues that this customer attention evolved once again with relationship marketing. Building trust—the center of any good relationship—became marketers’ focus. Marketing technology—such as CRM and data mining— started to bloom. This evolution dovetailed with the meteoric rise of social and mobile marketing, where the customer is always receptive, so brands must always be communicating. T h e m a r k e t e r wa l k s u p r i g ht Through all of these changes, no executive position has evolved more than the CMO. Kimberly Whitler, a marketing professor at the University of Virginia’s Darden School of Business, calls the CMO “the most misunderstood and frankly underappreciated” role in the C-suite. Not long ago, the reputation of CMOs was run roughshod. Forbes, in Nietzschean fashion, proclaimed in 2012 that “The CMO is Dead.” To quote Dominique Turpin, president of IMD and author of that death knell: “CMOs are increasingly powerless and peripheral. The CEO sets the overall strategy, the R&D and innovation teams design the product, and the CFO determines pricing and departmental budgets. The CMO, meanwhile, reports to a chief executive who often has only partial knowledge of the customer. No wonder some CMOs are considering a career change.” Turpin wasn’t simply being glib; many CMOs were looking at their jobs and longing for more. The jobs, in turn, looked back and expected the same. Marketers had lost corporate power when the bottom fell out of the economy in 2012. At that time, CMOs told Forrester that they were looking to leave behind corporate life and become consultants, according to Forrester’s “The Evolved CMO in 2016.” Were CMOs about to be pushed out of existence by a bad economy? Could evolution be stopped in its tracks? Slowly, something started to change. Whitler, a former CMO and brand executive for companies such as Proctor & Gamble and David’s Bridal, says marketers spent the years leading up to the 2010s trying to become “finance literate” to connect
marketing actions to financial outcomes. In the 2014 version of Forrester’s CMO survey, marketing executives said they were returning to corporations and trying to build CEO-level leadership skills. Analytic technology, such as CRM, was becoming widely used thanks in large part to the many consumers who were online and had become accustomed to giftwrapping their data for marketers via various websites, platforms and apps. As an example of how much data people started churning out, 67% of the U.S. population had a social media profile in 2014—up from 56% in 2012—according to a report from Edison Research and Triton Digital. “Now, not only do marketers have to be finance experts, but they have to be technologists and they have to understand the ways in which they can connect with consumers,” Whitler says. In 2017, one would never know CMOs had been dragged through the mud. CMOs have taken a seat as equals at the executive table, Forrester’s report says. They have expanded their responsibilities to include forming the heart of customer experience. Roughly 66% of CMOs told Forrester they have primary responsibilities for both marketing and customer service. To boot, the aforementioned Edison/Triton report found that 78% of U.S. residents now have a social media account, giving up swaths of valuable data. On Facebook, as an example, users like 4.1 million posts per minute, according to computer software company Domo. For marketers, this level of customer data is like raw steak to a hungry dog. Chief marketers have also brought a new work ethic and a measurable backbone to the executive table. Forrester’s report says the best CMOs “earn the respect of fellow C-level executives by bringing a strategic viewpoint, exceptional measurement and analytical capabilities, financial management rigor and operational savviness to their role.” Sheryl Pattek, analyst and CMO executive partner at Forrester (and a former CMO herself), says marketing has evolved from being viewed by companies as a cost center to being seen as a business facilitator and manager, thanks in no small part to customer data and insights. CMOs have stepped beyond the role of marketing and become “corporate officers.” This means more knowledge
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N o w, n o t o n l y d o m a r k e t e r s h a v e t o b e f i n a n c e experts, but they have to be technologists and they have to understand the ways in which they can connect with consumers.
of the customer and business, more responsibility across the entire company and more pressure for CMOs to succeed. CMOs now serve as the voice of an increasingly powerful customer. It’s the age of the customer, according to Small Business Network President Jim Blasingame, so doesn’t that mean it’s also the age of the CMO? Even Forbes acquiesced; Neil St. Clair, chief growth officer for Vestorly, wrote in a 2015 column that there is “no acronym so dangerous in the English language as C-M-O.” Marketing News spoke with those who have firsthand experience in the CMO evolution to hear about some of the biggest changes. The next step in the evolution may be the most exciting. As Nikola Tesla, inventor of the modern alternating current electricity supply system, said in 1915: “Precisely one of the most gratifying results of intellectual evolution is the continuous opening up of new and greater prospects.” Few executives seem to exemplify this quote more than the CMO. P o w e r o f th e T r a n s f o r m a t i v e Br a n d Steve Handmaker, CMO of Assurance, quickly swaggers into the lobby of his company’s Chicago office. He reaches his hand out and responds to a standard greeting with what must be a common quip of the evolved marketer: “Meetings, meetings, meetings.” Handmaker works with approximately 6,000 customers, a C-suite full of executives and a fleet of employees, all while building the brand of Assurance, an insurance brokerage that works with clients to minimize risk and improve health.
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Handmaker started his marketing career 25 years ago by sending out mailers, crossing his fingers and hoping for the best. Now, it’s numbers, people and the litany of meetings that fill his days. This bevy of work grew gradually. Ten years ago, every insurance brokerage marketed three banalbut-positive attributes. Handmaker lifts a finger of his left hand for each: “We are the greatest in service, we are the lowest-cost provider that you’re going to partner with and we’re the smartest,” Handmaker pauses, thrusting his right shoulder and head forward, adding, “And almost nothing else.” Unfortunately, Assurance wasn’t much different, right down to using the same vapid stock photography as competitors. Handmaker, searching for answers, read Seth Godin’s Purple Cow: Transform Your Business by Being Remarkable. It gave him an idea: Assurance needed to find its own purple cow, something that would make potential customers stop, gawk and think about what the company has to offer, breaking the ranks of monotony with something that wasn’t so hackneyed. But what set Assurance apart from the pack? The employees, the real people. The personal touch. Assurance had been hiring talented workers to form what Handmaker called a “people-oriented workforce” and built an enviable corporate culture, one where people seemed to actually take joy in working with insurance. Why can’t that be the story? So it was: Stock photos of glad-handing models were replaced by photographs of Assurance employees to show off the company’s culture. Assurance also bragged about its independence— unique in an age of mergers and acquisitions— and its ability to produce measurable outcomes,
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Wh a t I s a C MO ? Ask an average CMO what their family and friends think they do at work and you’ll likely get a caricature landing somewhere between something he says customers weren’t getting in a market that had seemingly grown complacent. Assurance’s overall message: The control is safely back in the customer’s hands, and real people will be there to help. “We told that story and, for a time, you barely could find that we did insurance on our site,” Handmaker says. Ten years on and Assurance’s purple cow has been a cash cow. Now, “meetings, meetings, meetings” could mean dinner with executives from the Chicago Cubs, lunch with a manufacturing business trying to implement a new health plan or showing the latest ROI numbers to other C-suite executives. “The good news for us is we got there first with the story and that became a really nice touch point with all of our clients and prospects. It made us noteworthy,” Handmaker says. “Now we’re continually pivoting as we go.” The company was listed No. 4 on Fortune’s “10 Best Workplaces in Insurance 2015,” proving the power and endurance of good company culture. This has been a boon, Handmaker says, as the culture “absolutely” has to be congruent to what the company brings to the customer. Great talent wins, he explains. When people buy in and enjoy the culture, there’s a vibe that radiates outward. This kind of vibe does not exist at all companies, Handmaker stresses, as most tend to leave it up to human resources or “four speeches a year from the CEO” to get hyped. This will only get a brand so far, he says. It takes a thoughtful plan to converge marketing and communications, internally and externally. “Those plans, unfortunately, are not driven often enough by the CMOs,” he says. ”I think that’s starting to change.” Every interaction customers have with a company will now be essential, Forrester’s Pattek says. She echoes Handmaker’s sentiment, saying it’s impossible to separate brand management from customer experience, as the brand is now defined by how the customer interacts with it. For this reason, Handmaker believes CMOs across America will have a “major influence” on brands and American culture. “They’re going to bring a lot of that external attention internally and it’s going to improve their performance in the end,” he says. UVA’s Whitler concurs, adding that brand leadership and architecture-building is why many
the Don Draper archetype—writing ribald, libidinous copy and shooing people out of their corner office with the flick of a wrist—and a white-collar office worker stuck somewhere between a meeting, a phone call, a detritus-covered desk and computer screen filled with charts and graphs. Ask an average CMO what another CMO does and they wouldn’t necessarily know. They’d likely assume it’s the same thing they are doing themselves, according to a presentation given by Whitler during AMA’s 2016 Summer Conference. Whitler says there is no singular role for CMOs. Some focus on marketing and communications, others customer experience and others still take charge of marcom, such as CRM and public relations. This scattershot set of assumptions may be why average CMO tenure is, as of 2015, just more than 3.5 years (44 months). While this is up from 2006 when the average CMO lasted less than two years (23.2 months), it’s indicative that expectations aren’t being met by chief marketers at many companies, especially since the average is down from a high of four years (48 months) in 2014.
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people believe CMOs are most poised to take over as CEO. In modern times, the best CMOs build a customer-centric model or perish. Whitler says there were three bases for recommendation when she worked with Proctor & Gamble: Is it right for the customer? Is it right for the retailer? Is it right for the company? “There is a reason for that,” she says.” [Good CMOs] create the systems that support this kind of outside focus, and they align the internal operations against that kind of external focus.” A Renaissance Role Sitting at a horseshoe-shaped formation of desks in front of a Chicago-style bay window, the lean team of Gate 39 Media—made up primarily of designers and developers—work away at building the online future for financial organizations. CMO Sarah McNabb, who refers to herself as a marketing “Swiss Army knife,” takes pride in knowing every aspect of what they do, working to make the business operate smoothly. The CMO must have a hand in everything, especially on a small team. “You have to have the versatility of knowledge in multiple aspects of marketing: social media, content writing, management distribution, analytics, CRM, processes and marketing strategy overall,” McNabb says. “It’s super important that you have a grasp on how all those cogs fit into the bigger machine and how that machine works.” McNabb, who has worked in finance since 2002, ensures each client gets the effective and legally compliant content it needs (infographics, articles, website text, blog posts), right down to editing old content to fit the client’s voice. She also works closely with developers and designers at Gate 39, straddling the line between the customer and company and working to translate what the client wants and how the company can help. Often, McNabb will use her skills as an artist— she majored in illustration and design and creates art as an after-work hobby to blow off steam—to help tweak designs and do mock-ups of navigation wireframes for a client’s website. She also travails over the user experience of each website, ensures content is optimized for SEO and does anything else she can to make sure the client is satisfied.
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She’s also working on Gate 39’s website redesign and relaunch. To McNabb, the evolution of the CMO has meant a widening of scope. Work now goes beyond simply deciding where advertisements will be placed, something she deems an “archaic role that doesn’t exist anymore.” Now, the CMO must have broad knowledge and become an “ongoing Renaissance person who’s continually seeking to learn,” she says. One quality a CMO should have, in McNabb’s opinion, is an ability to develop new processes to keep the company from stagnating. After starting at Gate 39, McNabb noticed the company’s CRM
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program wasn’t up to par, so she adopted an industryspecific program and became knowledgeable enough to extend its service to customers. Now, as an added perk, customers can have their own CRM and sales processes. Gate 39 avoided stagnation and expanded consumer offerings. This focus on innovation is new for the CMO, Pattek says. Now technological savviness, digital understanding and an analytic mindset are musts to be a CMO, which was not the case just five years ago. Marketers have to become lifelong learners, unwilling to favor their leftor right-brain sensibilities, but able to access either for specific tasks. Whitler says this is likely
exacerbated at smaller companies, like McNabb’s, where CMOs have fewer executives to share the workload, but notes that modern CMOs must now know about technology, security, finance and other non-marketing business facets. For the evolving CMO, adapting to a new era means avoiding the stagnation of the days without data and avoiding the previously predicted death. “In this agency, we are very fluid in terms of changing up, pivoting and adapting new processes,” McNabb says. “A lot of the financial companies out there, where you have departments who’ve been doing the same things over and over for years, those are the ones that are going to die out.”
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The Ever-quickening Evolution of Marketing Measurement After entering the marketing industry during what he calls “the twilight of the ‘Mad Men’ era,” Clay Stobaugh has evolved multiple times in his 36-year career. He’s worked for Sperry and Hutchinson, Reuters and now serves as executive vice president and CMO at publisher John Wiley and Sons, every role seemingly adding new lines of text to his job description. When Stobaugh first started, fresh out of Harvard Business School, coupons and direct mail were essentially the only measurable pieces of collateral for a marketer—everything else was brand-driven and targeted to a specific audience, but unspecific by today’s standards, he says. Television, billboards, print, newspapers—marketing relied heavily on ad impressions, reach and frequency. Spray and pray. The next advancement in measurement came for Stobaugh at Nestlé Switzerland during the launch of the Nespresso capsule, the granddaddy of modern coffee pod products like the Keurig K-Cup. In this iteration, Stobaugh used the “razor and the blade” model, as he called it, of selling the machines through the Williams-Sonoma catalogs, department stores and other high-end shops. Sales were tracked through store machines in the retail market and telephone sales through the catalog (this was, after all, pre-internet). Ten years later, Stobaugh and other marketers got their first taste of true data measurement. “We went from what I call ‘Mad Men’ to modern marketing, because now we could really look at the numbers. We started to become performance-driven,” Stobaugh says. The analytic evolution in marketing started slowly with e-mail, which Stobaugh says mostly entailed looking at open and click-through rates. There was no big focus on content marketing and no value-added content; it was all about messaging and the offer. Back then, Stobaugh says he used to show a slide at presentations that displayed about 100 marketing technology companies in existence that could help clients modernize data capabilities. Three years later, as the market grew, the slide had 500 businesses. “Today, you can’t even do a slide like that. There’d be 10,000 companies,” Stobaugh says.
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Marketers went from having no data, to some data, to data in bunches trapped in silos. At this point, around 2009, Stobaugh says marketing technology became very advanced. As CMOs removed data from silos, they became equally creative and analytical. No longer were CMOs simply looking at a piece of the pie, they were the baker. CMOs used middleware data management tools that could feed all related data to one place. Analysis became quick. Speed became of the essence. Every modern CMO, Stobaugh says, now has his or her own marketing technology groups. “What’s been the door-in for marketing to be at the C-suite table is having the data that represent the voice of the customer,” Stobaugh says. “Everybody else in the organization speaks about the customer qualitatively, but marketing actually has all the quantitative data, so they can have a voice.” The other element, he says, was marketing and sales enablement and sales’ endorsement of marketing as a lead driver. Handmaker agrees that real-time data and marketing technology have been key turning points for the modern CMO. The formerly unprovable is now easily proven; CMOs can readily confirm success and showcase value to the executive suite. Creativity with numbers isn’t exactly the creativity marketers are known for, but Handmaker says marketers must have analytic guile, quickness and effectiveness, lest they get left behind. “Your customer’s expectations of the speed with which you should be responding to requests, wants and needs is completely different than it was,” Handmaker says. “And it’s going to get worse. There’s no going back. It used to be you’d make a request, and if we respond to you later that day and promise you delivery within two business days, you were doing A-plus work. I can think of very few things in my life where that would feel acceptable to me right now.” Customers’ trust must now be earned at every turn. These days, when someone doesn’t like your service, they’re more likely to tell the entire internet than to write a private letter. Reputation matters for the evolved CMO, and it’s driven by a coalescence of speed, precision and grade-A customer service. In the modern age, technology allows for easy management of all of this.
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If your own people don’t understand, buy in, get excited, get motivated or get turned on in all the same ways you’re hoping to do with your client base, you’re fighting from behind.
“You have to keep up. You have to be fast to respond. You have to be fast at identifying problems,” Handmaker says, speaking rapidly. “You can’t wait anymore.” The Next Evolution The next evolution of CMOs could be further down the traveled path, but Handmaker says there may be one fork in the road where marketers will have to turn around: creativity. The proverbial pendulum has swung from the adman to the math man, but Handmaker says the true storyteller will soon return. “The CMO is getting back to being a storyteller,” Handmaker says. “Part of that is the swing back to the artistic bent, if you will, with so much focus on content.” Whitler says there’s a preoccupation with today’s CMOs being “quantitatively capable,” but she believes this focus is superfluous. In her research, quantitative CMOs—those driven mostly by data science—have shown to be the least effective. Hybrid CMOs—those with the ability to empathize with the customer, create deep insights beyond spreadsheets and capability for creativity—are most capable of handling the job. “CMOs who can actually take insight and convert it into behavior-changing programs, who have the ability to navigate the organization, who can affect change within the organization, who can influence their peers and who can lead,” are best-suited to lead, Whitler says. “Just being quantitatively capable doesn’t give you the skills to do all of the other things you need to do.” Handmaker says CMOs who hope to evolve must work tightly with the rest of the C-suite
and the business at large. CMOs who turn their attention inward to bring everyone on the same page will have a better chance of selling customers on a product or an idea. “If your own people don’t understand, buy in, get excited, get motivated or get turned on in all the same ways you’re hoping to do with your client base, you’re fighting from behind,” he says. Historically, a divide exists between sales and marketing; successful CMOs must address this chasm by having a cohesive, analytical system in place. Beyond a cohesive sales-marketing system, the evolved CMO must technologically define the experience of the customer and the organization, Forrester’s Pattek says. To do this, CMOs must understand the company’s technology stack and get involved in how consumer data is collected. This, she says, will help CMOs predict future customer behavior and allow marketers to see when new technology, such as artificial intelligence, must be adopted. The evolved CMO cannot forget cybersecurity when thinking about the technology stack, Whitler says. Breaches often occur through marketing technology where important customer and company data lie, so CMOs must be regularly engaged with risk officers and cybersecurity experts to keep the company and its customers safe. If there’s one quality an evolving CMO has, McNabb says, it should be an acknowledgment that they don’t know everything. Work as a CMO is a continuous education. “I don’t know that it will ever be possible to be up to speed,” she says. “I think it’s like being on a treadmill. To be up to speed would be to get to the end of that line; on the treadmill, that just doesn’t happen.” m
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The era of Big Data was a long time in the making, but there’s little doubt its impact has already been felt. Could the future of marketing jobs come
Down to a
Science? 38
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By Zach Brooke
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S
een any postings for good marketing jobs lately? If so, you might have noticed an interesting trend in the requirement listings. More companies are turning to marketers who are not just conversant with digital tools, but specifically Big Data—people who can drink from the fire hose of information to pin down actionable results of customer-facing decisions, but also tease out competitive advantages through a better understanding of targeted segments. In other words, they are looking for data scientists.
It’s no secret that data science is having a moment. The Harvard Business Review called it “the sexiest job of the 21st century.” Wired suggests data science is a more lucrative career track than medicine. And heavyweight industry analysts Gartner and McKinsey put out research reports within a year of one another that project a shortfall of between 100,000 and 190,000 data science jobs by the end of the decade. Our tech-based economy, so dependent on digital information, has profoundly reshaped the American workforce over the last quarter century. As with so many employment sectors, that transformation creeped into marketing. By all accounts, the demand for marketers who can run a regression analysis is outpacing the need for brand analysts by a very wide margin. The step counters, the search trackers, the location scouts, the social network mappers, the electronic personal assistant, the assortment of gadgets that
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hoard the output of our existence and file it away for careful consideration by pattern-seeking mercenaries skilled at crunching that volume of knowledge—that’s where the jobs are. If the demand for data science is as real as experts are saying it is, how much can be learned by established professionals looking to boost their prospects throughout the back half of their careers? “It is a very active market,” says Linda Burtch, managing director of executive placement firm Burtch Works. “We found there’re a lot of companies that are just now jumping in,” despite data science having been hot for at least the last five years. Burtch says her company is currently looking to fill approximately 120 analytics positions. The successful applicants to those positions can generally expect to earn a base salary between $97,000 and $152,000, unless they are managerial roles, in which case that salary
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ceiling rises to about $240,000. Although some of those openings are just rejiggered job descriptions for extant payroll slots, the majority are for newly created positions. The positions may be new, but the discipline isn’t, as evidenced by the people filling the ranks. In some respects, data science roles have been there all along. Burtch says the trend toward corporate data science needs mimics an industry paradigm shift she saw early in her career when the economic landscape began trending away from manufacturing and started going digital. When she started recruiting in the mid-1980s, Burtch was operations-oriented, focused on optimizing operations, transportation and pricing. Then, marketing and finance began to come to her with needs for analytics professionals as well. “With all the data that [became] available, you could really understand behavioral analytics much better,” she says. During that time, statisticians who traditionally would have gone into quality control, operations support or biostatistics found they had new options on the business side of things in marketing finance, Burtch says. DA T A IS L I F E Michael Dickenson, CEO of Ironbridge Software, a boutique business intelligence solution for CPG and retail, lived that evolution. Much of Dickenson’s professional life has involved data mining. Some of his duties may have changed, but he’s still doing a lot of the same work he was doing in the 1970s. A graduate of Cambridge with degrees in engineering and computer science, he originally worked on large mainframe computers. Later, he worked at an outfit that produced econometric models of computers. Having gained that expertise, Dickenson and a few partners opened up a new business that took what they knew about econometric modeling and put it on a PC—cutting edge technology at the time. “We raised some venture capital and got the business going,” Dickenson says. “By a lucky event, we sold what we had done to what was then the AC Nielsen Company. That’s when I got into Big Data and became a data scientist.” Interestingly, Dickenson says it’s only been in the past few years that he’s considered himself a data scientist. Over the years, he’s been called a programmer, a systems analyst, a consultant and—to his detriment—a statistician.
“The industry gets a little bit leery of statisticians,” he says. A few years ago, Ironbridge wrote an algorithm for predicting sales using regression, looking back at years of sales data and projecting a future result. “We could not get the company or client interested in adopting this because the people out there in the field did not want to trust their bonuses and their commissions to some geek writing this algorithm.” Now that data science is all the rage, Dickenson finds it a lot easier to sell his insights. “Big Data has a name. It’s got this aura that there’s some sort of magic in it that you’re going to find things going on in your business—problems to solve or opportunities that you didn’t even know existed,” he says. There’s one big caveat to the position cited by Burtch and what Dickenson does: They are for traditional, narrowly focused data science tracks. They are heavy on STEM and light on marketing. As Burtch Works defines it, data science is a subset of the larger analytics discipline. “Data science is not trivial. It’s really hard stuff,” Burtch says. “Data scientists are working with substantial amounts of data, and understanding the computer science behind all of that is important. It’s hard to achieve that proficiency even with a technical master’s degree, and it’s certainly not something somebody can pick up from a non-quantitative bachelor’s program and a few coding classes. That doesn’t really work.” D A T A SCI ENCE LI TE What are marketers to do? Maybe the real story isn’t the shortage of pure STEM-certified data scientists, but the emergence of a softer skill set for people who are comfortable working with specific fields of data. Google has certainly made it easier. In addition to being the principle driver of our data-drenched world, it has released tools that allow untrained data managers to drill down into their organization’s customer analytics. “There are different elements of the job of a data scientist,” says Dr. John H. Johnson, an econometrician, head of the consulting firm Edgeworth Economics and the author of Everydata: The Misinformation Hidden in the Little Data You Consume Each Day. One element of the data science job is the ability to use computing power to acquire the data, he says. This includes educated choices about different software languages and hardware just to handle the volume of data. Then sense has to be made of the data. How
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a scientist applies statistical tools, economic tools and different disciplines is another facet. As Johnson outlines in his book, there are several misconceptions about data that will throw untrained researchers for a loop, with potentially disastrous results. Data doesn’t come in a neat little package, ready to answer the questions marketers care about. “There are many times where the underlying data that is the basis for what people have calculated is actually wrong,” he says. “If you make a mistake with the underlying data, that could be a big problem.” Three years ago, Google bought Nest Labs, a publicly traded IoT thermostat and smoke detector manufacturer. Wall Street wizards saw an opportunity to cash in on the impecunious stock poised to be gilded by Google. Except there was a problem. The symbol
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that traders latched on to, NEST, actually belongs to Nestor Inc., a bankrupt security systems company. “People automatically assume that just because something is based on [data], that it’s more rigorous and it’s more careful. If the number is wrong then it’s really not that helpful,” Johnson says. “The premium on being able to understand what data you have, to understand what types of questions can be answered with it, and to make smart decisions is really, really high.” However, there are places where pure data science functions can fall short of what’s required to boost success in the marketplace. This is where marketers thrive. Burtch says business acumen is the main asset desired in marketing data scientists, after technical skill. “It’s so critical because a lot of quantitative candidates get so wrapped up in the elegance of the
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People automatically assume that just because something is based on [data], that it’s more rigorous and it’s more careful. If the number is wrong then it’s really not that helpful. The premium on being able to understand what data you have, to understand what types of questions can be answered with it, and to make smart decisions is really, really high.
analytics that they forget that they’re answering business problems.” Dickenson echoes Burtch sentiment. His decades of experience in CPG and retail have left him with an intuition for business problems not readily discerned by unit numbers. “As a data scientist, you have to know your industry. I know statistics, and I know how to produce nice charts. I could move over and work on Wall Street, but I wouldn’t know the real tricks in the industry,” he says. What, then, does a marketer-turned-data scientist look like? Ask Charlotte Bourne, a data science manager at Cardinal Path, a marketing analytics agency that’s part of the Dentsu Aegis Network. “I’ve had a bit of an unorthodox trajectory,” she says. “My background was actually in digital
marketing, which led to digital analytics and then to data visualization and then to statistics and then to integrated analytics.” Although much of her experience was forged on the job, she is positively academic compared to others on her team. “A lot of my background was informed by digital marketing and why digital marketers need data scientists,” Bourne says. “We also have people on our team who took less academic paths and got more hands-on experience with some of the free courses that are out there.” Bourne and her team routinely use their expertise to conduct forecast and attribution surveys for their clients. They are sharing their expertise with other marketers as well, hosting websites with follow-up blog posts that became the largest entries on the Cardinal Path website. The trail they are blazing captures the essence of the new marketing career field. Data is too profuse to remain an entirely specialized, STEM-based profession, but too technical to be outsourced completely to laypeople. Instead, hybrid positions are emerging at the intersection of computer science and business analysis. With a pronounced need for data-driven insights and an unmatched knowledge of where the business needs to go, it’s up to marketers to forge the middle group. “If you can build up some basic intuition and logic about how to work with data,” Johnson says, “you know there are all sorts of people who are essentially citizen data scientists.” m
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{} Cracking the Culture Code When HubSpot’s cofounder proposed Katie Burke become head of company culture, it sounded to her like a shortcut to unemployment. Instead, Burke continues to hold down both her job and what she calls “radical transparency” at the tech firm.
By Sarah Steimer
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Company culture is a buzzword.
when most companies take their foot off the gas of focusing on what their organization stands for.
It can evoke images of free coffee and ping-pong tables. HubSpot’s vice president of culture and experience, Katie Burke, contends that a strong company culture is less about perks and more about transparency and diversity. Her organization has received ample recognition for its company culture efforts, but she continues to ask herself: “How else can HubSpot step up?”
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Being in charge of company culture is a huge marketing role. How long have you worked at HubSpot and how did you get into this role exactly? I’ve been at HubSpot for a little over four years. When I first started at the organization, Hannah [Fleishman, HubSpot’s recruitment marketing manager] and I were running internal and external communications. We did that through our IPO. That was the biggest day in the company’s history. We spent a lot of time with the executive team setting the tone for employees that the IPO was not the finish line, but the starting line. For us, the best days of HubSpot were to come. Oftentimes that [message] is something people say but don’t actually execute or invest in. Dharmesh [Shah], our co-founder, the author of “The HubSpot Culture Code,” asked me to go to dinner shortly after the IPO and suggested that I take over the culture team as a full-time profession. I said, “That sounds like a great way to be unemployed in a year,” because so few companies have a dedicated culture organization. The reality is, it was the ultimate sign to our organization that not only were we not thinking of the IPO as the finish line, we were going to double down on culture during a time
What did this new position mean for the company as a whole? The creation of that role did a few things: One, it sent a really strong message to our employees and our candidates about how seriously we took this. Two, it gave me the opportunity as someone coming in with fresh eyes toward how we think about people, to think about opportunities for innovation and improvement. For example, one of my passion areas is creating space for women in leadership. ... Now we have a robust women’s network in all of our locations. We have been able to double down on what’s working, eliminate programs that weren’t and create a culture that scaled with us as we grow, versus reminiscing about the good old days. I feel very lucky to have been a part of this transition. I will fully acknowledge that it wasn’t part of my grand master career plan. It’s a testament to the company that they were willing to put someone from a marketing role into a people role, and one of the coolest things about our culture team right now [is] it has folks with a hospitality background, people with a marketing background, people who came from a content background. One of the benefits of a nontraditional team is you build nontraditional programs and get some great dividends from that. There is an assumption that company culture means whether or not you allow dogs in the office or beers on Fridays. How accurate is that? Most people think culture equates to perks. We feel the exact opposite. What I always say to people is that it’s the
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people that work here and the problems they get to solve on a regular basis on behalf of our customers that make our culture remarkable. The perks are just a byproduct of that environment. One of the challenges that relates to the marketing world is that perks are sexy to talk about. But the core of why people come to work every day is because of the autonomy they get to do their work, the transparency of the information we provide here at HubSpot—those are the real things that make someone love their job on a day-to-day basis. You can’t buy your way into the heart of employees with perks. Nor can you dazzle them. Really smart, remarkable people want to work with colleagues who they really admire in an environment that challenges them. That’s kind of the core of what a company culture is about. How would you describe an ideal company culture? A culture of a company is the environment that defines and informs how employees act on behalf of customers and how the company hires, retains and grows its people. You know you’re doing culture right when it’s not posters on the wall, but rather fundamentally informing how the everyday employee makes a decision. One of the things I love about Facebook is one of their core tenants as an organization is that nothing is somebody else’s problem. The reason I like that is if, for example, I am an intern on their finance team and I see an issue in our numbers, rather than saying that’s someone else’s issue to solve, I know that I’m empowered to fix it. It actually informs how I behave on a day-to-day basis. That’s when you know your company culture is working, when people don’t just understand what your company stands for, they understand
how they could or should behave in a tough situation to solve for the customer, to help the company grow, that sort of thing. The second you think you’re perfect is the second you’re disrupted and the second you get it wrong. One of the reasons humility is one of our core values at HubSpot is we don’t ever believe anything is done or perfect. Every time we get an award for our culture, the next day I come in and think, what are three things we need to do differently in the next six months to hit the gap on what we’re doing well. The reality is that candidates see all the awards you win for great places to work, but so do your competitors. They’re going to up their ante and say, next year we need to be here. By the way, your employees see it and expect you to do better next year. The best company cultures are highly iterative and highly humbled. The things that worked for us two years ago are not the same things that work for us now. If we’re not constantly evolving, we’re missing the point.
Katie Burke, HubSpot’s vice president of culture and experience.
You’ve written about making feedback the cornerstone of your culture. Do you think too many
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HubSpot employees celebrating Women@ Work with an ice cream social.
companies try to dictate the culture without including the employees in that conversation? Absolutely. If you try to create your culture top-down, you miss valuable context. You also get a snapshot of what you think your culture should be, rather than a reality check of what your culture actually is. Most companies do employee surveys once a year. If you think about the last time you had a problem or a challenge at work, it wasn’t a year ago— chances are it was a lot more recent. Having an annual survey usually means there’s anywhere from 12 to 14 months between employees giving feedback and the company actually responding in any way, shape or form. [Employees] have no idea how you responded, no sense of what the results were beyond [their] own feedback, and by the time the company
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got around to publishing it, [employees] forget what [they] complained about. We do quarterly feedback because we believe that dynamics change just like an organism. Companies are living, breathing entities that change and evolve over time, so it’s imperative to get an understanding of what’s going on in the minds of employees. Even the most humble, involved and on-the-floor executives do not see and experience the same challenges as employees on the front line, making feedback from the front line critical, not just to understand what’s going on in your business, but to actually fix it. You said you do these surveys quarterly, but let’s say there was some sort of a shake-up in the C-suite or you move offices, do you add another survey or do
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you have another way of getting immediate feedback? When there’s a shake-up, the bigger issue is when we don’t talk about the elephant in the room. What most people do when that happens is take a survey but redact all the information about the executive who left or the change that was made and just refer to it in vague generalities. We try to go the exact opposite way. HubSpot prides itself on being radically transparent. When your company is changing the most is when you need to lean into transparency with the greatest tenacity. When we go through any sort of shift or change, we not only prioritize surveying employees shortly thereafter, but we also over-prioritize both the communication on the initiative and our willingness to answer questions about it. Surveys are critical, but they’re just one ingredient. Ultimately, surveys are passive tools; they’re often done online. It’s important that you are willing to meet employees where they are and actually talk about what’s going on in-person. That human face is critical, especially when change is evolving. People want to know that you see them, hear them and you’re willing to speak to what’s going on in the company, versus entirely going through your PR, IR or legal team to do so. HubSpot has received culture commendations from Fortune, The Boston Globe, Glassdoor and others. Is there something about the culture at Hubspot that these organizations took note of? It comes down to two things: One is transparency. It’s usually at our size that companies back off of transparency. The most important thing about transparency for us is defaulting to sharing pretty much everything. As a public company, the natural inclination would be to hide things
from public view, or at the very least, the question we always get is whether our interns or co-ops get access to that data. The answer is absolutely yes. When we’re willing to be radically transparent, we send a message to our employees that we trust them. We think that they are remarkable, trustworthy and dynamic enough as individuals, and we’re going to treat them like adults and expect that they’re going to do right with this information. By the way, that transparency, if you’re someone who’s interested in becoming a founder or entrepreneur, is going to help you by osmosis become a better leader. To think about challenges or problems, to learn from failure throughout the organization. Transparency is a key part of that. The second thing is just our focus on culture. Awards are, from my perspective, a lagging, not a leading indicator of culture. The awards we’ve received are a direct result of the hard work we put in well before that. Our VP of engineering, Eric Richard, spent a full day with one of our support engineers understanding what she was hearing from our customers about challenges with the product or challenges with their
{
When we’re willing to be radically transparent, we send a message to our employees that we trust them.
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}
day-to-day business. After doing that, he left her a handwritten note saying, “I just want to thank you for all the work you do on behalf of our customers,” along with a gift card to her favorite restaurant. At most companies, the VP of engineering sits on a throne and talks to people only when he or she feels like it, so the fact that we have leaders on our team that don’t just think of culture as someone else’s job, but as a core ingredient of what they do every day—that’s honestly what most of the awards are a direct result of. What’s interesting to me about that story is that he knew her favorite restaurant. Anyone can shoot out a thank you note, but is personalization what takes the company culture a step further? To your point, most praise is arbitrary and generic. I want people to leave HubSpot with real clarity around what they’re doing well and feeling noticed and appreciated for what they do. One of the hallmarks of the culture team at HubSpot is that we want to draw as much from hospitality as we do from human resources. If you think about the last time you stayed at a wonderful resort or had a
One of the hallmarks of the culture team at HubSpot is that we want to draw as much from hospitality as we do from human resources.
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great experience going to a spa or retail location, it’s often the personal touches, not anything expensive, that make a difference. People see you for who you are. Extracting those personal details is something we really try and make a hallmark of how we recognize folks. Can you give some examples? One of the things we did in December was a program called Random Acts of HubSpot. That program was designed just to be able to raise your hand and say, “Hey, my colleague Hannah is doing an amazing job and I know this thing she likes.” Or, “She’s a huge fan of elephants,”
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and we will send a personalized card on an elephant notecard. It’s not about the expense, it’s about the thought that goes into it. We allowed any employee at any level with any tenure at any location in our organization to nominate people. We try to do programs like that that combine personal touches with allowing anyone in the organization to participate, and we find that makes a big difference. How does culture affect the way a company is able to market itself to the best candidates for a job? It used to be that companies could manage their external employment
plans with things like brochures or trade shows. For example, you’re a candidate, I’m a recruiter, Hannah works with me at HubSpot and if you want to get direct feedback from her about what it’s actually like to work here—not the rhetoric but the actual reality—you would have to go through me as the recruiter. I have all the control and you’re sort of left to your own devices to guess whether you’re making the right choice. With the advent of both social media and Glassdoor, no longer does the recruiter have all that power. The dynamic has fundamentally changed. Candidates have more power, more context and more information than ever to make their decision. As a result, your employment
Each year, HubSpotters participate in the JPMorgan Chase Corporate Challenge.
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A HubSpot employee taking a break in an office nap room.
brand used to be what you said, and now it is what you do on a day-to-day basis to deliver on your promise. When we think about employment brand, it’s not just about creating a great job website, but it’s about making sure that whatever is on that website, whatever is on our Glassdoor page is really indicative of the experience people will get when they come to HubSpot, and it’s really illustrative of what we value, what we care about and some of the great work our employees on the ground are doing. How were you able to showcase employees’ experiences? Hannah helped pioneer a program where we had folks put on GoPro cameras and actually show their day-to-day life, end to end. You’ll see one of our designers kissing his daughter goodbye. You’ll see one of our product designers in Dublin kissing his partner as he heads out the door and his partner waving goodbye to him. You’ll see our team in Japan taking the train and what it looks like going into our new space there. The idea was to remove some of the production value, but add more reality. You’re going to see a lot more content like that. We tried to get creative and more dynamic.
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The blog on our career site is dedicated entirely to telling employees’ stories and/or adding tremendous value to the candidate experience. I don’t know if you’ve ever done a video interview, but I find them super awkward and I’m pretty extroverted. We had our recruiters put together a full post with examples of how to do a good video interview. If you’re just coming out of college or university, it’s incredibly helpful. We really invest in telling stories. Not just about how many awards we’ve won or great employees that got promoted, but about the day-to-day of working here and how to get your foot in the door. We spent a lot of time closing the gap between rhetoric and reality and invested an inordinate amount of resources into being transparent for candidates about what it’s really like to work here. What can candidates do to learn about company culture before they go on an interview? Your goal isn’t to say that you would fit in, the goal is to say you would add to our culture. I like people who challenge us coming in the door. For example, we had a new hire who came in who asked what our plans were to get more female candidates in the door and get more female leaders. I like people who challenge us right off the bat and understand what we’re working on, what we prioritize and what we care about. I love when people read our blog and consume our content on a regular basis. People focus far too much on understanding what people look for in a candidate and not enough time actually researching the nuts and bolts of the business. I always love when people look at our past earnings call and just get a better sense of where we are as a business and what that looks like. I recommend investigating more informal sources. I love when people
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have done things like checked out old SlideShares that our co-founder Dharmesh [Shah] put together, or his blog on startups so they understand how he thinks about business and talent. I love it when folks have attended our inbound conferences and seen one of my colleagues speak about their experience. I also love when people take the time to reach out to someone who’s on the team they might be joining and/or to read their content from a peer perspective. Blog content, social, business results, the company’s Glassdoor page are all great places to get information and context if you’re a candidate. You mention that it’s more about being able to add to, rather than fit in with, what already exists at the company. Is there ever an issue where culture turns into conformity? That’s a real challenge. One of the things we did early on in HubSpot’s culture was talk a lot about autotomy as it relates to things like unlimited vacation. Unlimited vacation is definitely a core part of working at HubSpot, which is fantastic. The reality is that if you just lead with unlimited vacation itself, it sends the wrong message about what we’re actually looking for and what we prioritize. One of the things we started doing was profiling different types of folks and how they use autonomy to build their work around their life, versus the other way around. We talked about new parents coming back to work and how they’ve optimized their schedule to work for both their job and their family. Another thing we’ve altered recently under Hannah’s leadership is our job descriptions. If you say, we want someone who fits in here and you use a lot of acronyms to confuse people, it sends a message that you want people to conform. We started redoing all the job
descriptions so we make it abundantly clear that if you’re a lifelong learner, open to challenging us, open to challenging the status quo and an interesting dynamic, you would be a great fit here. Everything from your job description to your job site to how you handle the candidate interview experience can send messages about how you value diversity of thought and perspective. Like many top companies, we’re learning by being there and have some room to grow. Speaking of diversity, the political climate lately hasn’t always promoted a difference of opinions. Do you see this affecting company culture at all? Is that something you’ve had to stop and consider how to approach? It’s something we’re starting to approach already. The best candidates in the world recognize that the research is abundantly clear that diverse teams perform better. People forget, often, that there’s a business imperative to make diversity a top priority. For example, we’re building a global customer base of marketing and sales customers around the world. Those customers expect that our team and our leadership reflect the diversity of language, thought, perspective, gender and age that they represent as well. We have an obligation to do it, but it’s also the right thing to do for our business, our brand and our team. If you’re a person who’s missiondriven, chances are you care about what’s going on in the world, and you have a deep concern for the people you work with. We have more and more candidates asking what we’re doing about diversity and how they can be part of the solution, and that’s exciting. It’s out there and frankly I think most tech companies, if you’re not thinking about it, you’re behind the curve. m
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on the record
The New Bilingual: Strategic and Tech-savvy By Zach Brooke | staff writer
zbrooke@ama.org
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hat skills do marketers need in 2017? An easier question to ask might be what’s not needed. Whether it’s classical business acumen, communications expertise or tech and data proficiency, there’s seemingly no tool that’s too specialized to be considered outside the realm of marketing. Learning to bridge those areas is the single most important task for 21st century marketers, and, like any summit, can be demoralizing. But instead of considering these skills like items on a checklist, perhaps it’s better to focus on the goal of deploying them in tandem to create quality experiences. Warren Tomlin, chief experience officer for IBM, says that providing a better customer and employee experience is the North Star that all companies and individuals should chart their courses to before using their skills to set sail.
Q
What are the keys to providing great experiences in 2017?
A
As leaders in 2017 and beyond we have to talk about the need to be bilingual and fluent in two languages. That’s not Spanish and English or English and French, it’s the language of strategy and business and the language of technology. When you’re having a conversation with the CIO or the CTO about how they make experiences come to life, they’re worrying about words like scalable, secure, cloud-enabled, etc. And if you think about the chief digital officer or CMO, they’re talking about acquisition and retention. Our view is that modern leaders need to be bilingual across those two languages because strategies unlock new possibilities for
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technology to deliver those strategies. It becomes a virtuous circle.
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What happens when a company has separate groups that can only speak one side of the equation?
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We see these “random acts of digital” that have emerged. The analogy we often use is a campground at night. There is a glow from all the fires in a campground, and all the campers are huddled around them. In some ways, that’s what is happening inside the organization. HR or product management or marketing or IT—they’re all standing at differing levels of maturity of digital efforts to get experience. But if you don’t federate those into one bonfire that everyone coalesces around, then you’re sub-optimizing through these random acts of digital. When you bring them all together, great experiences don’t happen by accident. The last best experience that anybody has anywhere becomes the minimum expectation everyone has for everywhere.
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Do you have any examples of great experiences you’ve helped deliver to IBM clients?
A
We have a bank client where the CEO would go into a bricks-andmortar Apple Store and repeatedly drop a pen or a pencil, then bend down to look under the tables and see how they’re all connected. He knew as he was redesigning the retail bank of the future that the last, best experience someone had in retail is arguably the Apple Store. We have another financial services client that is using our cognitive capability in their contact center, so when you call
them, they are taking all your information and building out a personality profile on you. They’ve also profiled their agents to personality type. They’re queuing the calls in real time to drive a better experience that will lead to a better outcome. That’s a lot of orchestration between technology and strategy and creativity.
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What is the role of the marketer in all of this?
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The CMO’s role was a strategic marketing role. At some point— with the dawn of the internet—it became subordinated to a chief marcom role, and a lot of decisions were still being driven by IT. Marketers are now coming to work with great technology in their pockets. They’re now coming to the CIO and CTO and saying, “I want these great consumer experiences at work.” In 20-plus years, we’ve gone from great, powerful computing and internet access at work and poor access at home, to employees and marketers going to work saying, “Why can’t I have all this [tech] at work when I can have it in my home life?” It’s completely inverted. The role of the chief marketing officer now has emerged to be one of the key orchestrators and drivers of change. Not from a marcom position, but being the voice of the customer to drive those experiences and drive that change.
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When you talk about these great experiences, they seem like massive projects that require that full flex of the corporation for a long period of time? What is a reasonable timeline to improve experience?
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Most of these great experiences rely heavily on data. To drive really great experiences, you need to get down to the experience of one. If you spend all your time planning and orchestrating with heavy tech and heavy strategy, by the time you’re rolling it out, has your market and customer already moved? Most brands we work with understand consumer digitization, digital transformation, digital
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on the record
reinvention. They build apps. They’ve built websites. They’ve triaged all those capabilities and services to those digital channels. For the most part they are generally pretty good. I would say you need to know where you’re going. But then you’ve got to start the fire.
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How do you start that fire?
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The area that is most overlooked now is the emergence of employee experience. It’s a bit counterintuitive
because ideally, you want to spend your budget on the things that impact your customers most directly. I also lead our global mobile business, and probably 80% of our client’s questions have been around employees and how they have been enabled to have the tools and capabilities to drive the best experiences for customers. That would look like a hardware store with a tablet in the smock of every employee, so when customers go in to talk about insulation, an employee can
career advancement
pull out the tablet, show a video, figure out how much the customer needs to insulate their house and have it shipped. They don’t even need to go to the cash register. They can do the transaction there while the customer is being educated. Experiences are hard, but if they’re purposeful you can get to a better place. What we’ve seen is the realization that investing in employee experiences will drive better experiences. It’s one of the most profound areas that’s overlooked. m March 2017 | marketing news
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POSITIONS WANTED FREELANCERS AVAILABLE QUANTITATIVE RESEARCH SERVICES: Online Surveys, Survey Mailings (Discount Business Reply), Date Entry, Data Tabulations, SPSS & Quantum, MaxDiff, Conjoint, Opportunity Analysis, Comment Coding and PowerPoint Presentations. UGA graduate with 20 years experience. Quick turnaround. Please call Jeanne Eidex at 770.614.6334.
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Are You Part of the Contact Marketing Movement? This shadow marketing practice is quietly helping sales teams produce results that defy belief in support of account-based marketing strategies by Stu Heinecke
W
e all want more sales; that’s a given. But how we get more sales is not. Many marketers have turned to account-based marketing (ABM) to identify and target the companies they’d most like to sell to, but breaking through to the accounts that can push your enterprise to new levels of scale is never easy. In fact, it’s often nearly impossible. There is a shadow form of marketing out there that perfectly complements ABM and has been generating results most marketers would find hard to believe. I dubbed it “contact marketing” in my book How to Get a Meeting with Anyone. Contact marketing is a fusion of marketing and selling, employing specific campaigns designed to connect with specific high-value prospects, including CEOs, C-level executives and other top decision makers. As I was researching for the book, I discovered that a surprising number of marketers were using their own homespun, often audacious methods for creating breakthroughs. But it was all happening in complete isolation— all the practitioners knew was that they needed to find a way to break through to someone very important, someone who would be difficult to reach. You might recall some pretty outrageous things you’ve done to connect with someone. Maybe you’ve heard stories, like the single shoe that shows up with the promise of the other to complete the pair when the proposed meeting takes place. Or a remote-control car model
showing up with a note promising the missing control unit during the meeting. Sending half of a gift with the promise of the other half may crack some doors open with some difficult-to-reach prospects, but it’s hardly state-of-the-art contact marketing. Many CEOs report taking a meeting just to get the missing piece, then ushering the representative out the door. Once the toy is brought home to the CEO’s children, the representative and his company are soon forgotten. Simply getting in the door is an important part of making meaningful contact, but it’s not enough. The contact campaign must also impart a feeling of, “I love the way this person thinks. I need to meet this person.” And it must quickly deliver the promise of value focused on the target executive’s specific needs. Contact marketing campaigns don’t operate like other types of campaigns. The target group is usually quite small, sometimes just a single person. The cost spent to reach each person can also be quite high, easily hundreds of dollars or more. While the cost and audience figures may be surprising, the results can be shocking. Response rates to contact marketing campaigns have been as high as 100%, producing ROI figures in the tens, even hundreds of thousands of percent. When the founder of NoWait set out to launch his app, he employed a classic contact marketing strategy. The campaign targeted just 30 people, but these were the CEOs of the top 30 restaurant chains in the country.
career advancement
The NoWait app turns any smartphone into one of those pucks used by restaurants to alert customers that their table is ready. By eliminating the pager device, NoWait also eliminates the need to wait in the restaurant for a table. To introduce the app to the 30 dream clients, NoWait devised a clever campaign that featured personalized videos delivered on iPads in custom NoWait packaging. Each video contains three segments. The first features a man-on-the-street host showing up at one of the chain’s restaurants on a busy Saturday night with a hidden lapel cam. Walking in, he finds a huge crowd inside waiting for tables. The video finishes with the NoWait CEO speaking directly into the camera to the recipient, saying, “I love eating at your restaurants, but I hate waiting for a table. We should talk.” The targeted executives were so impressed that roughly 70% responded, some saying it was the cleverest campaign they’d ever seen. Thanks to the campaign, the NoWait app is now featured in 20 of the top 30 restaurant chains in America. Top sales blogger and best-selling author Dan Waldschmidt gives us another example of the power of focusing on very few high-value prospects with an audacious delivery. In addition to his blogging, Waldschmidt is a turnaround specialist. He has a fascinating way of connecting with prospects for his services. Waldschmidt combs the business news every day, looking for stories of missed earnings estimates. When he finds one, he has a beautiful sword made with the CEO’s name and an inscription engraved on the blade. It ships in a fine wooden box with a handwritten note inside. The note says, “Business is war and I noticed you lost a battle recently. I just wanted to let you know if you ever need a few extra hands in battle, we’ve got your back.” Waldschmidt reports a nearly 100% response rate to his campaign. Cartoons That Create Contact My introduction to the world of contact marketing came as a result of my cartoons. In addition to being a marketer, I’m one of The Wall March 2017 | marketing news
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Street Journal’s cartoonists. I quickly discovered how powerful cartoons can be as contact devices. When I launched my first creative agency years ago, I targeted two dozen consumer marketing directors at the big Manhattan-based magazine publishing companies. I sent a personalized print of one of my cartoons along with a note explaining I’d just beat controls for Rolling Stone and Bon Appétit using that same personalized cartoon device. I urged that we produce similar tests for their titles. As a result, not only did I connected with all of my target prospects, they all became clients. That was a 100% response that was worth millions of dollars. It launched my marketing business, and it all came from a campaign that cost less than $100.
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These are just a small sampling of the stories coming from marketers all over the world of a movement no one actually knew was a movement. There are several types of gift strategies; the car and shoe examples, my cartoons and Waldschmidt’s swords are part of the half-gift, art, humor and film and visual metaphor categories. Other strategies include specific uses of e-mail, social media, video, insight and intelligence, interviews and media exposure—including several methods that went way beyond normal marketing thinking, like the campaign used to reach a single contact by running a letter of introduction as a full-page ad in The Wall Street Journal. The ad cost $10,000, but resulted in a $350 million sale. As I’ve spoken at events, connected with readers on social media and
interviewed many marketing and sales thought leaders, it has become clear that contact marketing has been a movement for a very long time. Not being afraid to spend a lot per contact, using large amounts of creativity and audacity and believing that high-potential accounts are worth every effort to win their business is what contact marketers all have in common. You’re probably already part of it. If you aren’t, you really should be. m Stu Heinecke is the author of How to Get a Meeting with Anyone, host of Contact Marketing Radio and founder of Contact, a contact marketing agency dedicated to helping sales teams connect with their most important prospects and assigned accounts.
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advertisers’index
ADVERTISERS’ INDEX Quick source for contacting the suppliers in the March 2017 issue of Marketing News. 2017 AMA Calendar of Events . .... inside back cover URL: h ttp://ama.marketing/2017events 2017 AMA Marketing Workshops .......................... p. 11 ttp://ama.marketing/Spring17 URL: h AMA Marketing & Public Policy Conference . ..... p. 21 URL: http://ama.marketing/mppc17 AMA’s Marketing Resource Directory ................... p. 5 Ph. 1-888-777-6578 ttp://marketingresourcedirectory.ama.org URL: h
Marketing News ...................................................... p. 59 Email: sales@ama.org URL: http://www.ama.org/mediakit Research USA ............................................... back cover Ph. 1-800-863-4800 URL: http://www.researchusainc.com StudentBridge, Inc. . ................... inside front cover Ph. 678-242-1400 URL: http://www.StudentBridge.com
AMA Members-only Webcasts . ............................. p. 6 Email: savdic@ama.org ttp://www.ama.org/MOW URL: h
Thank You to the 2017 Winter AMA Conference Sponsors and Exhibitors ................... p. 7 URL: http://www.ama.org/winter
AMA Whitepapers ................................................... p. 13 Email: sales@ama.org ttp://www.ama.org/whitepaper URL: h
University of Georgia . ............................................. p. 3 Ph. 706-542-3537 URL: http://www.marketresearchcourses.org
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#OfficeGoals A peek inside the marketers’ offices that make us drool
Architecture and interiors by Partners by Design.
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Photos: Tom Harris, Hedrich Blessing Photographers
Centro: A developer of digital advertising software that streamlines digital campaigns, Centro has one goal: improve the lives of the people behind campaigns. Centro is dedicated to the growth, well-being and happiness of its employees. Partners embraced this manifesto by creating a fun and elegant design that is perfect for growth. Key materials—such as greenery, wood, steel and concrete—were used to form an elegant, sophisticated, tech-centric office space. Centro’s floor plan fused several different buildings into one, creating a challenge to optimize a changing floor plan into a functional design. The creation of “parks” broke up the large floor plan and created an identity for different departments with alternative work spaces.
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