7 Bridges


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A collaborative planning guide for enterprise customer engagement programs, across multiple channels, in a complex and connected world

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7 Bridges

  1. 1. 7Bridges A discussion guide for marketing in a complex world
  2. 2. 7Bridges 1 Companies that can plan and manage more cohesive customer engagement programs across multiple channels, media and organization touch points, will gain competitive advantage in a pull market. Premise Business has become considerably more challenging in a contracted post-recessionary economy as companies compete for a smaller piece of the pie, and the consumer has all the leverage. The market dynamic has shifted from distribution push to access pull, from selling to helping customers buy. Yet most companies still operate in a push business model – pushing products, advertising and promotion through distribution and media channels, reacting to a rapidly changing market landscape. The playing field has been leveled. Market Situation
  3. 3. 7Bridges 2 7Bridges is not a solution or a dissertation. It’s a discussion guide for a conversation about how the market has changed and how business needs to adapt rather than react. It’s a re-evaluation of the role marketing plays in a pull economy, by engaging customers in a meaningful way, making your brand more relevant to their lives. It is an aggregation of information, observations and concerns from thought leaders and disruptive innovators who are challenging the status quo of traditional business in a new market reality. The intent is to open the aperture of consideration when planning enterprise marketing programs that cross multiple channels, silos and media. This discussion focuses on the bridges that connect seven foundational pillars of business – those that drive revenue and brand value: customers, employees, communities, channels, outsource partners, organization silos and media. Starting the conversation
  4. 4. 3 Introduction Business operates on a complex system of bridges that connect companies with customers, across global markets down to local communities – bridges that connect management with employees, sales channels and distribution partners, suppliers, agencies and service providers. These interconnected bridgeworks are built to accommodate transactional, logistical, informational and technical requirements of business operation, but the thing that holds them together is the human connection, reinforced by trust. All of these factors must be considered when planning an enterprise customer engagement program. With so many moving parts and interdependencies, employing a disciplined, collaborative approach to planning is crucial to business success in an increasingly complex world. Organization Silos Channels Media Employees Customers Community Partners 7Bridges 1. To customers 2. To markets and communities 3. To employees 4. To organization silos 5. To sales distribution channels 6. To outsource partners 7. To media and marketing campaigns Starting the conversation continued 7Bridges
  5. 5. 4 Knowledge is power. Mapping provides a visual guide. The first consideration should be: What do we really know about our customers? Not just transactional trending, but a deeper investigation of the underlying emotions that motivate purchases and drive decision processes. Where does the organization touch the customer? Is there a human engagement, or is it media? Mapping these points of interaction and transaction provides a visual landscape from which to begin the planning process. Value Profit Back Office Customer Service CEO CMO HR Sales CFO Website Backac OOfficeOffi Customer Service CEOECE CCMOO HR Salesale CFO Websiteb “The purpose of business is to create and retain customers. Without the customer there is no business.” – Peter Drucker “Holding onto a customer has never been harder – or more important. Proprietary Gallup research shows the key to winning customers isn’t price, or even product. It’s emotion that creates a deeper level of engagement.” – Alec Appelbaum, Gallup 2001 1 Bridges that connect companies with the customers they serve are the primary thoroughfare of business. These are not stationary bridges; they are constantly changing, multiplying and contracting, fueled by shifts in media, social trends, and consumer attitudes and behaviors. Building and sustaining meaningful connections with a diverse customer base in a highly fragmented and competitive market environment has never been more challenging. The tendency is to react with a piecemeal approach to marketing that too often focuses on immediate financial needs, lacking an overarching customer strategy and a master plan for execution. Since the customer now owns the brand, the company must own the customer. That requires a deeper level of understanding. Bridges between the company and the customer 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  6. 6. 1 Shared insight is the glue that binds disparate factions and channels to a common view of the customer and a collaborative approach to marketing. The challenge is gaining a deeper understanding of who our best customers are and what makes them tick: What are the rational needs and emotional desires that drive purchase behavior? What are the underlying fears and uncertainties? How do your customers feel about your brand? How is your brand relevant to their lives? How have purchase patterns changed over time, and why? What are the indicators of loyalty and attrition? What life changes and events trigger purchase needs and motivations? To what communities, social networks or affinities does the customer belong or participate? How does media and social interaction affect purchase decisions? 5 More companies are investing in research and data mining to gain better customer insight, but many are looking only in the obvious places, through an analytic rather than a human lens. Outdated research methods in a new market Despite millions of dollars spent on traditional market research, nearly 80 percent of new product offerings fail, according to Gerald Zaltman, professor of marketing at Harvard Business School and senior fellow at Harvard’s Mind, Brain and Behavior Initiative. In his book How Customers Think, Zaltman makes the case that traditional research tools simply do not get at the deeper levels of insight that drive decision-making processes, most of which are subconscious. Using a process of “consensus mapping” to identify contributing and conflicting emotions, he offers an interesting perspective on what happens within the complex system of the mind, along with societal pressures, as consumers contemplate their needs and evaluate different product options. 1Bridges between the company and the customer continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners “95% of all cognition occurs below awareness in the shadows of the mind, while at most 2% occurs in the higher-order conscious.” –Gerald Zaltman, How Customers Think
  7. 7. 6 2Bridges between the companies and communities 7Bridges Organizational Silos Channels Media Employees Customers Community Partners As product advantage has been largely neutralized, brand preference is attained more by trust than image. And so a company’s value system is increasingly important to consumers, still harboring feelings of distrust resulting from corporate greed and self-serving motives that helped lead us to the past recession. It’s about being a good company, not just selling good products. Good companies have a social and environmental conscience, treat their employees well, and give back to the community. Marketing that reaches out to communities as well as to individual customers is more likely to get to those deeper levels of engagement and emotional connection: Taps into a sense of belonging that builds brand affinity and relevance – pull vs. push effect Creates a brand presence within communities that builds talk value and social reinforcement Reinforces a corporate culture of integrity and social conscience – rather than profit motivation Makes the brand part of the social fabric of our lives, not just purchase transactions – higher purpose Emanates within the company and extends to the community – employee engagement Philip Kotler is one of the elder statesmen of the practice of marketing, from an academic standpoint. A recognized guru of marketing management, author and tenured professor at Kellogg School of Management, Kotler’s tenure spans 50 years of market evolution. He’s also a long-time champion of the 4 Ps (product, place, price and promotion), which he now concedes is an outdated product-centric approach developed for a “push” market. Inhismostrecentbook,Marketing3.0,coauthored by Hermawan and Iwan Setiawan, Kotler talks about how companies must compete in a customer-centric “pull” market environment. Digital technology and social media have propelled customers to a widespread clustering effect, self-segmented by special interests, desires, affinities and beliefs – what he refers to it as “communitization.” To compete in the new market, he concludes, companies need to take a more holistic approach to business and marketing, adhering to a values-driven model that connects not just with the mind of the consumer but also the human spirit.
  8. 8. Takeaway: Markets and communities are splintering into smaller clusters while at the same time expanding geographically to global markets, crossing over different cultures, beliefs, languages and affinities. This complex and fractured environment puts increased pressure on companies to institute a more centralized approach to marketing that bridges diverse markets down to community levels, making customers feel they belong to something more important than product utility. It’s about socializing brands, not just promoting them. Discussion Points Tap into community-owned web space to create a groundswell at local levels Employ web tools to track and monitor blogs and social media sites – listening before talking Encourage employees to extend into the community via social networks, company-sponsored community activities, family, friends and word-of-mouth 7 Support worthy causes, community events and initiatives – get involved and give back Demonstrate a societal and environmental conscience and a commitment to making the world a better place – corporate values Bring a higher level of cognizance to the human side of business – focus on interactions, not just transactions Connect with key influencers and opinion leaders within different communities Tap into the emotional need for shared affinities of beliefs. Explore means for gaining a deeper level of insight in order to engage customers on a socially connected rather than individual, “one-to-one” basis 2Bridges between the companies and communities continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners “Consumers want to be connected with other consumers, not companies.” – Seth Godin, Tribes, 2008
  9. 9. These bridges are in need of repair The economic recession has been hard on employee morale as the workplace is still reeling from massive layoffs, hiring and wage freezes – all of which have contributed to a culture of fear and uncertainty in many companies, and a general distrust of management. Head-count reduction has clearly demonstrated to employees that they are viewed as a cost rather than an asset. Companies need to keep in mind that employees are also consumers who are wired into communities and social networks and are sharing their views with the rest of the world. Employees are more empowered and have a significant impact on business results, in terms of customer engagement and brand experience. A “good place to work” is determined not just by salaries and benefits, but integrity, social values and environmental conscience. Research has shown that when employees don’t feel valued and are not emotionally engaged, they tend not to go above and beyond what is required. More important, they do not advocate for the company or brand. Yet the 8 most impactful customer interactions are those personal encounters with employees. This should put employee engagement at the top of the list for CEOs, who must now restore trust in the workplace. Repair work begins by reprioritizing and defining corporate values with a purpose that extends beyond profit and return on shareholder equity. That is the reward. Companies attempting to align cultures with a pull market must start by engaging employees to a customer-centric mission. Employee Loyalty Plummets In a survey done by the Center for Work-Life Policy, a New York-based research and consultancy group, over a period from June 2007 to December 2008, the proportion of employees who professed loyalty to their employers dropped from 75 to 30 percent. The number voicing trust in the company they work for fell from 79 to 22 percent. “Companies that embrace and foster an insular corporate culture will result in having employees lose focus of what really matters – the customer.” – Peter Drucker, 1954 3Bridges between management and employees 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  10. 10. Gerald Zaltman, professor of marketing at Harvard Business School, made an interesting observation in his book, How Customers Think, that “consumers do not live their lives in the silo-like ways in which businesses organize themselves.” Silo effect Organizations “silo” by nature; defining and protecting one’s territory is instinctual human behavior. But today’s complex business environment, with more specialized competencies, functions and technologies, is causing silos to splinter into even smaller factions, each with its own narrowly defined focus, priorities and measurement that are not always aligned to a common brand strategy. Functional silos often spawn their own subcultures within the broader organizational culture that is shaped by the CEO. Those companies with a top-down control and command management style tend to encourage more territorial behavior and hierarchy as employees compete for power and pecking order. This runs counter to customer-centric organizations, which are bottom-up, focused on those points where the employees touch the customer, and where value is delivered. Realigning priorities in the C-suite Inacustomer-centricorganization,thelinesof responsibility for the CMO extend beyond marketing functions to include cultural and operational issues that affect the customer experience. With this expanded scope comes the need for more authority, and a greater voice in business strategy and policy making. It’s a job that has become increasingly difficult. CMOs face significant obstacles in attempting to initiate a more collaborative approach to planning enterprise marketing programs that cross different functional silos, lines of authority and profit centers. Without strong support from the CEO, this can be a futile undertaking, which is probably why the average tenure of a CMO is less than two years. 4Bridges between organization silos 7Bridges Organizational Silos Channels Media Employees Customers Community Partners Marketing Sales Finance IT HR Website Search Social Media Mobile Email Advertising Direct Marketing Sponsorship Events Digital Marketing CEO 9
  11. 11. In his book Spanning Silos, David Aaker, professor emeritus of marketing strategy at the Haas School of Business, University of California Berkeley, is emphatic about unification. With the market as complex and fragmented as it has become, he states, it’s imperative that companies engage employees in a common sense of mission and focus that serves to span silos. This can happen only by creating a more centralized planning function, driven by a common strategic framework and performance metrics. 10 This collaborative planning process results in a collective blueprint or roadmap for implementing more cohesive and consistent customer engagement programs across different channels, media and organization silos. Aaker outlines some of the basic requirements: Shared customer knowledge and insight Clarity of mission and purpose Getting the right people in the right roles Communication and dialogue Reaching out to internal influencers and thought-leaders Breaking down or unifying silo subcultures within the company The most obvious barriers are negative or even hostile attitudes toward centralized marketing; difficulty in creating cross-silo strategies and programs, since there is often too much focus on tactical activities; lack of strong marketing talent and leadership to drive change; and most important, lack of CEO support and dedicated resources. 4Bridges between organization silos continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  12. 12. Discussion Points Is your company culture, management style and organization structure encouraging territorial protectionism and competition, or collaboration? Is there a unified focus on the customer? Create a customer “touch” map that identifies and qualifies points of customer engagement across the organization Engage influencers to foster more interaction and collaborative planning processes Build a centralized dashboard that includes both customer and employee engagement metrics that correlate to financial outcomes Communicate and socialize external marketing programs to internal constituents across different silos, making them feel like a part of the marketing process Align compensation drivers and incentive-reward programs to customer-centric behaviors Is the organization viewed in terms of profit centers to the company or value centers to the customer? 11 Look at your organization from outside-in; how does it look from a customer perspective? Identify which silos to break down and which to unify Do marketing practices emanate from the needs of the customer, or the company? How can these be brought together? Are employees empowered to initiate action and make decisions that enhance the customer experience? Is the customer’s voice represented in policy making and management decisions? 4Bridges between organization silos continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  13. 13. The days of proprietary, single-channel distribution are over Sales and distribution channels have long been the focus of management in a push business model, fueled by sales quotas, lead generation and conversion rates. Growth has traditionally been driven by increased sales productivity, expanded market coverage and by extending product lines. In tough times the battle cry has been: sell harder and wider. Today it’s sell softer and more focused. The channel is also where customer relationships typically reside – the human side of business that plays a crucial role in developing long-term loyalty and sustained revenue growth. The challenge faced by many companies has been, and continues to be, controlling the channel – not just managing sales reps, agents and dealer networks, but creating a higher level of collaboration with shared access to customer relationships. It’s a challenge made more complicated in today’s customer controlled, multi-channel market environment. 12 The customer is empowered to circumvent or cross the boundaries of once-proprietary sales and distribution networks and buy direct. As the channel dynamic has shifted from push to pull, it is the customer who has gained leverage and control. As such, the basic function of sales channels has changed from one of selling to access and facilitation: engaging with customers and helping them buy, then sustaining the relationship. Companies may need to rethink the way they approach channel management as part of a broader customer engagement strategy. This requires more synergy and continuity in the overall customer experience, with a focus that extends beyond individual sales performance. Compensation drivers need to extend beyond short-term financial goals to longer-term customer metrics. 7Bridges 5Bridges between sales channels and distribution partners Organizational Silos Channels Media Employees Customers Community Partners The flow has been reversed from distribution push to access pull, changing the function of the channel from selling to facilitating purchase by building relationships on trust through more personal interaction.
  14. 14. Discussion Points Provide the channel with insight and conversation-starters, rather than traditional sales training Use interactive tools that empower sales reps to engage with customers in conversation rather than present to them Target decision-makers rather than product users or gatekeepers. Get to the people with authority to say yes, not no, and those looking for the best value, not just the best price Ask relevant questions to better understand needs and emotional decision-drivers. Look past product features to uncover what buyers really want – where is the itch? Rather than trying to clone your best sales people, clone your best customers Integrating sales and marketing functions requires breaking down some long-standing territorial boundaries. The line that separates the two is increasingly blurred in a pull market – both need to be focused on the same agenda Extend and diversify customer relationships across different value centers within the organization, rather than protecting relationships to maintain leverage and control Use social media networks to listen and learn Find ways to create more interface between customers and employees Include sales reps and distribution partners in planning processes and marketing campaigns 13 Breaking the 80-20 rule The primary barrier to business growth has been Pareto’s 80-20 Rule, which dictates the distribution of inputs and outputs. Sales productivity is predictably unbalanced, with 80 percent of the revenue coming from 20 percent of sales reps or distribution partners, and 80 percent of repeat-purchase volume coming from 20 percent of customers. As the cost of maintaining sales organizations continues to increase, the economics of the 80-20 Rule have become less cost feasible. Companies can break the rule by refocusing channel priorities and compensation drivers on key customers rather than broad-based selling, and on creation of value rather than sales revenue. It starts with attracting the right customers and engaging them at a deeper level – by chumming rather than hunting. This, of course, requires the right chum. Salesrepsandagentswhocangainabetterunderstanding of the customer’s needs and help them buy will be more successful in a pull market. It’s a scratch in search of an itch. 5Bridges between sales channels and distribution partners continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners “The aim of marketing is to know and understand the customer so well that the product or service fits the need and sells itself.” –Peter Drucker
  15. 15. Back in the day, companies could control media, and audiences were captive. The media landscape was simpler and more manageable because it was limited to broadcast and print that was bought and sold in increments of time and space, measured in reach and frequency, driven by interruptive creative. Media planning was quantified by circulation, viewers and listeners, as determined by research from relatively small samplings of the mass market. Content was determined by agencies and media companies and pushed through the pipeline, with revenue derived from advertising or subscription fees. That was then. Now content is available from multiple sources,accessiblefromanyremotelocation,withanability to share freely. “Content wants to be free” attitudes are putting increased pressure on the media industry to evolve new revenue models for a pull market. Budgets are shifting from mass to micro, from passive to interactive, because traditional advertising is no longer as effective or cost- efficient as it once was, nor credible. Agencies are shifting to digital marketing, but many are still attempting to apply interruptive push advertising methods to pull media. This 14 may create brand awareness but does not contribute to a meaningful brand experience – only a media experience, which cannot sustain. To be effective, media planning must be done within the context of a broader customer engagement planning process that incorporates multiple channels and touch points. Companies that can listen and receive, not just broadcast, with a strategy to move customers to human interaction, will build a stronger, more sustaining connection with the brand. It took 30 years for television to get 50 million viewers. It took the Internet five years to get 50 million viewers. It took Facebook five years to get 500 million viewers. 6Bridges between disparate media campaigns 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  16. 16. Discussion Points Are we chasing digital media technology in search of a customer strategy? Are we pushing offers and promotional messages through media channels, or engaging customers with pull strategies? Do we have a measurement system that crosses different media with common customer metrics? Do we have a proactive social media strategy, or are we jumping in because it’s the next new thing? Are we managing campaigns in a cohesive and synergistic manner? 15 Are we delivering a consistent brand message across disparate media, using integrated marketing operations and data management? Are we all working from the same playbook? Media does not engage, people engage – there is a need for human voice in a digital world. 6Bridges between disparate media campaigns continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners A Yankelovich study reports that 70 percent of consumers are actively looking for a way to block, opt-out of or eliminate advertising. Consumer trust in advertising has plunged 41 percent over the past five years.
  17. 17. Chief Cat Herder How specialization plays against marketing synergy and harmony. The CMO’s task of planning and managing cohesive cross- channel marketing programs is difficult enough without having to manage numerous agencies and outsource service providers – hundreds for some larger companies – all of which are competing for their piece of the client budget. A “best of breed” approach to marketing services that focuses on specific media applications requiring highly specialized competencies, proprietary technologies and platforms, independent strategies, and performance 16 metrics, can make it inordinately difficult to orchestrate synergistic campaigns with a consistent brand message and cohesive customer experience. Collaboration is crucial in an increasingly fractured, disjointed marketing services industry. This necessarily starts with shared insight, data and systems integration, with a common strategic blueprint. It means crossing over the digital divide to include offline as well as online interactions. It also requires a central dashboard or scorecard that focuses on the customer, not isolated media metrics, thus allowing the CMO to quantify results across multiple campaigns. Marketing cacophony exists when the finest instruments are brought together, each playing its own music, in its own key and time, with the highest level of proficiency. But the overall sound is a collison, just more noise. It puts a lot of pressure on the conductor. 7Bridges between outsource partners 7Bridges Organizational Silos Channels Media Employees Customers Community Partners Data Management Research Analytics Email Direct Mail Web Marketing Marketing Automation Social Media Mobile Online Offline Advertising Content Creation Management Printing Fulfillment Graphic Design Public Relations Sales Promotions Call Center Loyalty Programs Strategic Consultants Point-of-Sale Promotions
  18. 18. Takeaway Building stronger bridges between outsource partners starts with a higher level of collaboration, communication, shared insight and clearly defined business objectives – working from a common playbook. This requires putting the needs of individual partners second to the best interests of the customer. Discussion Points Who’s leading the charge? Leadership is essential in creating a centralized planning function for cross-channel customer engagement that brings together disparate partners, internal stakeholders and organization silos to a unified focus Do we have a means and process for communication and shared information? Do we have a common scorecard that ties together different campaigns and media applications? 17 Is there a way to link outsource activities to common business objectives and performance metrics? Define roles and accountabilities: How do we consolidate and synchronize outsource functions, reducing overlap while optimizing different competencies? Are we giving partners a voice in campaign planning and strategy, or are we giving them marching orders? Are we tapping the intellectual capital as well as the tactical expertise? Do we have an open forum for discussion, brainstorming and whiteboard planning with agencies and service providers? 7Bridges between outsource partners continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  19. 19. In his book Total Access, Regis McKenna argues that marketers must shed their marginal role as image creators and take on the brave new role of managing a complex network of relationships and infrastructures – the seven bridges. It requires integrating the people and technology tools necessary to deliver value to every customer. Competitive advantage, he claims, comes from engaging the entire business in this total-access network, making marketing a mission-critical enterprise-wide responsibility, rather than simply a departmental function. The new CEO imperative is to turn the ship, facilitating changes necessary to better align the organization to a pull market, which the customer now controls. It is business not as usual. But change does not come easily. Individuals and organizations are resistant to change, since it is threatening to the comfort of status quo. Many CEOs are reluctant to initiate change that can be disruptive to the organization 18 and continuity of operations. It requires a redistribution of authority with empowerment at those points where the customer comes in contact with the organization. It’s a shift from transactions to interactions, from profit to intrinsic value, from building brands to customer loyalists. This can happen only with strong leadership. It’s moving the organization to a common sense of mission, to accept change and disruptive innovation, creating a more meaningful dialogue with employees and customers and making them feel connected to the brand – not just the products but the people. That requires a fundamental shift from distribution push to access pull – from selling to helping customers buy and feel good about their purchase. 8Conclusion 7Bridges Organizational Silos Channels Media Employees Customers Community Partners
  20. 20. 19 Bridging front-end planning with tactical delivery A complex market situation requires a more structured and disciplined approach to marketing, driven by a methodology that leverages customer insight and collaborative planning processes that weave together various media and channel campaigns into a more cohesive enterprise customer engagement program. That means bridging different factions, silos, channels and distribution partners to a common mission. The business of marketing. 8Conclusion continued 7Bridges Organizational Silos Channels Media Employees Customers Community Partners Online Engagement Planning StrategyInsight Design/ Build Data Infrastructure Implementation Customers Nex Tech Direct Mail Call Center Sales Force Agent/Dealer Point of Sale Event Print Media Offline Campaign Management Touchpoints Websites Social Media Search Email Mobile/Cell © 2010. This document and its contents are the sole property of Bridgz Marketing Group. Any reproduction and/or reuse without permission is forbidden.