customer experience marketing: realizing the promise of ... - Epsilon

STRATEGY AND ANALYTICS / TARGETING / CREATIVE / TECHNOLOGY / DIGITAL
CUSTOMER EXPERIENCE MARKETING:
REALIZING THE PROMISE OF DYNAMIC
INTERACTIONS
A WINTERBERRY REPORT SUMMARY
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INTRODUCTION
Customer Experience Marketing (CEM) is the sum of information, technology and process that
allows a company to maximize the value of its interaction – it’s more than just marketing. CEM is
about turning every email, phone call and point-of-sale transaction into an opportunity to enrich
a profitable long term relationship.
In April 2011, Epsilon and Winterberry Group set out to discover how marketers are planning and
activating real life CEM approaches in their businesses. Based on over 100 in-person, telephone and
electronic surveys with leading marketers, service providers and other knowledgeable sources, the
report: Customer Experience Marketing: Realizing the Promise of Dynamic Interactions identifies
five trends shaping the potential of CEM.
1) Marketers agree that improving the quality of their multichannel customer experience
is an increasingly critical business priority. But relatively few have devised strategies
specifically for the purpose of enriching customer experience, and even fewer have
allotted the dedicated resources or determined the appropriate metrics necessary to
optimize their CEM efforts.
2) Changing consumer expectations—nurtured over nearly two decades of “digital
accessibility”—are setting the standard for what constitutes success in experiencedriven
marketing.
3) The proliferation of data—including demographic, psychographic, technographic
and transactional information—has become the “single constant” in the perpetually
changing marketing landscape. Collecting, analyzing and making use of this
information (in near-realtime, and with a level of insight superior to the market at
large) presents the single most significant potential source of competitive advantage
in CEM execution.
4) Capturing candid customer feedback (and using it as the foundation of a robust
ongoing dialogue) is the tactical centerpiece of the CEM approach. The most
innovative CEM practitioners will look to inform product development, resource
allocation and general go-to-market decisioning with the insights gleaned from
these interactions.
WHAT IS CEM?
CEM is an approach
to managing integrated,
multichannel
customer interactions
with the same level of
targeted precision—
and with the same
objective of maximizing
customer value—that
companies have been
applying to their
acquisition, retention
and loyalty marketing
efforts for many years.
It’s about leveraging the
marketing function as
the centerpiece of an
interdisciplinary effort
that weaves together
data, technology,
promotional channels,
strategy and process in
a manner designed to
maximize the value
of a company’s most
precious asset: its
relationships.
5) Though much of the inherent promise of CEM is linked to the automation of sales,
marketing and service interactions, marketers and customers alike say that positive
interactions still depend on an effective blend of insight, speed, artfulness and
sensibility—bridging traditional distinctions between the “art” of sales and service
with the “science” of targeted marketing.
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RECOGNITION VS. ACTION
Across vertical markets, senior executives say improving the quality of their multichannel customer
experience is an increasingly critical business priority. While business leaders are recognizing the
experience they deliver to customers is a critical factor in determining the long-term value of
relationships, relatively few have devised strategies specifically for the purpose of enriching
customer experience. Even fewer have allotted the dedicated resources necessary to optimize
their CEM efforts.
Think about the marketing strategy your organization has
outlined to govern its activities over the next two to three years.
Which of the following best describes your expected approach
to CEM over that time?
On our agenda, but not
foremost among priorities
21%
Important
41%
A consideration in our
marketing effort
9%
Not a meaningful priority
3%
Source: Winterberry Group survey
A critical priority
27%
Which of the following best describes
the CURRENT role of CEM in your organization?
We employ marketing tactics in the course of regular
interaction with our customers, but these vary based
on line of business, function or prevailing marketing effort
36%
We employ marketing tactics in the course of regular interaciton
with our customers, but these are not tied to any given strategy
24%
We have a general set of guidelines for how we leverage
customer experiences for marketing purposes,
but no unifying strategy or approach
19%
We do not currently have an enterprise strategy for maximizing
the marketing benefits of our customer interactions, nor do we
attempt to leverage such interactions for those purposes
12%
We have a cohesive, unified strategy that governs
customer marketing interactions across all lines
of businesses and marketing efforts
Other
5%
5%
Source: Winterberry Group survey
Many respondents said their CEM challenges are rooted in the organizational structures common
to large multichannel marketers. This is because “customer experience” is a discipline that bridges
marketing, sales, information technology, product development and virtually all other major
corporate functions. Few companies have built the cross-disciplinary platforms necessary to
support the information, technology and process needs of flexible CEM infrastructures.
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CHANGING CONSUMER EXPECTATIONS
Nurtured over nearly two decades of “digital accessibility,” changing consumer expectations are
setting the standard for what constitutes success in experience-driven marketing. Cultural shifts,
macroeconomic developments and fundamentally new business approaches have served to
undermine a great many aspects of what we once took for granted in our everyday consumer world.
Now, almost twenty years after the internet emerged as an accessible consumer platform, digital
customer expectations are higher than ever. On the Web, we expect seamless, visually engaging
platforms that present information and features in precisely the manner we prescribe.
To what extent do you expect to leverage each of the following
channels as FUTURE components of your CEM effort?
Email
Direct mail
Search (keyword
analysis/buying)
3.4
3.7
3.9
3.9
4.1 4.4
Search (page
optimization)
Teleservices (inbound
call centers)
Surveys/market research
Social media
Online display advertising
3.4
3.1
3.2
3.1
3.4
3.0
2.9
3.3
3.7
3.9
Mobile
Teleservices
(outbound calling)
Broadcast Advertising
(TV/radio)
Print advertising
(newspapers/magazines)
Place-based media
(outdoor, in-store, etc.)
2.2
2.3
2.7
2.5
2.6
2.5
2.4
2.5
2.6
3.6
Source: Winterberry Group survey
1 2 3 4 5
Not likely to
be part of our
CEM research
Likely critical
driver of our
CEM research
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ALL ABOUT THE DATA
The proliferation of data has become the “single constant” in the perpetually changing marketing
landscape. Collecting, analyzing and making use of this information presents the single most
significant potential source of competitive advantage in CEM execution.
Whereas “marketing data” was once synonymous with “name-and-address,” the proliferation of
digital information has given rise to an entirely new array of sources, deployment opportunities
and potential inhibitors. Marketers looking to customize an individual customer’s online experience
can now lean on a deep well of transactional history, customer-provided preferences and demo- or
psychographic background data to drive a fundamentally custom interface.
To what extent are the following obstacles
actively hindering your CEM efforts?
Regular threat
Lack of appropriate
response channels
Lack of expertise among
the supply chain
Lack of appropriate delivery/
outbound marketing channels
Lack of internal expertise
Lack of data/
data integration tools
Lack of internal awareness
of CEM or its benefits
3.5
3.5
3.4
3.2
3.1
3.0
3.9
Costs
2.5
Source: Winterberry Group survey
1 2 3 4 5
Significant
hindrance to
our CEM effort
Little/no
hindrance to
our CEM effort
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THE NEW FEEDBACK LOOP
Capturing candid customer feedback (and using it as the foundation of a robust ongoing dialogue)
is the tactical centerpiece of the CEM approach. The most innovative CEM practitioners will look
to inform product development, resource allocation and general go to- market decisioning with
the insights gleaned from these interactions.
Think about your company’s high-level approach to its customer
interactions (including both consumers and “B2B” clients). How would
you rank the following as independent customer experience priorities?
Driving expanded sales of
existing product/services
Cross-selling different products/
services to existing customers
Ensuring we represent our
brand/products well
Driving sales of new
products/services
Maintaining an ongoing dialogue
with our customers
Enhancing customer loyalty
to our brand/company
Reinforcing our brand’s presence/
importance to our customers
3.9
3.8
3.8
3.8
3.8
3.8
3.6
Improving the performance
of existing loyalty programs
Source: Winterberry Group survey
1 2 3 4 5
Least
critical
priority
2.8
Most
critical
priority
Capturing and responding to the “voice of the customer” has long been considered the hallmark
of the customer-friendly marketing effort. Today, technology and social media have provided the
means for consumers to share feedback on products, customer service, purchase experiences and
anything else that comes to mind.
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AN ARTFUL BLEND
Positive interactions still depend on an effective blend of insight, speed, artfulness and
sensibility—effectively bridging traditional distinctions between the “art” of sales and service
with the “science” of targeted marketing.
Data, technology and process optimization are the pillars of the CEM effort that will drive lasting
customer value in an increasingly complex, fast-moving marketing environment. As we rush to
deploy the resources necessary to put those elements in their proper place, it would be wise for
marketers to consider a few guidelines as equally critical elements of their experiential approach:
Customers are people. People who want to be treated like people—with empathy, respect and an
outreach effort that is relevant and valuable, but not necessarily robotic.
Insightfulness—into an individual’s wants, needs and habits—has the potential to be
tremendously impactful. But, unexplained and unqualified, it can also serve as a destructive force.
Experiences, to a customer, are about more than just marketing—they must deliver value that
exceeds the promotional impact.
CONCLUSION
Marketers looking to benefit from true multichannel interactions should consider CEM as an
independent pillar of their enterprise strategy. Simply identifying CEM as a new priority will not
go far enough to meet the substantial need for deeper customer engagement. Alignment with
the customer requires understanding an ever-changing array of needs, demands and marketplace
dynamics—calling for dexterity and scalability in channel selection, cadence and messaging.
The pathway to CEM success will also require careful coordination by the various constituencies
tied to the customer. The effort binding all together should be a focus on the critical elements—
data, technology, people, process, delivery channels and customer input—that will ultimately
enable profitable, long-lasting relationships.
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