The Future of Marketing Elana Anderson Vice President, Enterprise Marketing Management
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1 The Future of Marketing Elana Anderson Vice President, Enterprise Marketing Management
2 Our world is undergoing a profound change driven by technology New forms of interaction 2.4B people on line 2.1B smartphones in 2015 Social media Massive amounts of addressable data RFID, GPS, intelligent sensors, network data, etc. Consumer generated data will result in 80 Exabytes by 2014 Affordability, analytics, and automation Affordably manage, apply advanced and predictive analytics, and Watson-style guidance to massive amounts of data The Result? Customers are more informed, empowered, demanding of and less patient with the brands they interact with. Businesses that harness these trends have an unprecedented opportunity to know their customer and interact in a truly informed and personalized way.
3 Marketing s universe is changing Customers know more Customers demand more Your business expects more and so CMOs must re-imagine their profession 3
4 As we look to the future role of marketing, we must remember the timeless responsibilities of the function. 4
5 The timeless responsibilities of our marketing profession Marketers have always been responsible for knowing the customer. Marketers have always been responsible for defining what to market, and how to market. Marketers have always protected the brand promise. 5
6 Today, these fundamental responsibilities provide the foundation for the three imperatives of a new profession. 6
7 The three imperatives of a new profession Marketers have always been responsible for knowing the customer. Marketers have always been responsible for defining what to market, and how to market. Marketers have always protected the brand promise. 7
8 The three imperatives of a new profession Understanding each customer as an individual. Marketers have always been responsible for defining what to market, and how to market. Marketers have always protected the brand promise. 8
9 The three imperatives of a new profession Understanding each customer as an individual. Creating a system of engagement that maximizes value creation at every touch. Marketers have always protected the brand promise. 9
10 The three imperatives of a new profession Understanding each customer as an individual. Creating a system of engagement that maximizes value creation at every touch. Designing your culture and brand so they are authentically one. 10
11 Marketing organizations in outperforming companies embrace these imperatives Revenue Growth / Gross Profit Growth 3-year CAGR, Engage: optimize experience across all channels High Low 7% / 6% 10 % / 12% Outperformers 11 Low High Analyze: sophisticated and cross company marketing analysis Source: IBM Center for Applied Insights: analysis of 100 public companies and their responses to the 2012 IBM Global Marketing Survey.
12 Imperative 1: Understanding each customer as an individual 12
13 Let s start with a story Have you ever felt that a company is grouping you with a population that you don't relate to? 13
14 Meet my mom, Iris 72 years old Loving grandmother of two Professor of Marine Science, William & Mary 14
15 Our customers are demanding that we know them as more than a transaction, more than a demographic, more than a segment. What do they hunger for? What is the deeper need we are trying to address? What do they want that they can t quite express yet? What is not just their next best action, but their next possible aspiration? 15
16 The best brands are very strategic about which touchpoints get instrumented and what data about individuals emerges as a result. What is your instrumentation strategy to learn more about customers as individuals? 16
17 The great leap is into all the data that lies outside our enterprise and into the new insights that data offers. Demographic data Character istics Demographics Attributes Transacti ons Orders Transaction data Payment history Usage history Needs Purchase stage Desires / Chat Prefer ences Call center notes What is your strategy for attracting data from beyond our borders? Behavioral data Opinions In-person dialogs Web clickstreams Interaction data 17
18 Armed with new analytics, we are able to enter the world of predicting the next best offer, action or need. Demographic data Character -istics Demographics Attributes Transacti ons Orders Transaction data Payment history Usage history Needs Purchase stage Desires / Chat Descriptive analytics Predictive analytics Prescriptive analytics How predictive must your insights about customers be? Web clickstreams Preferences Behavioral data Opinions In-person dialogs Call center notes Interaction data 18
19 Imperative 2: Creating a system of engagement that maximizes value creation at every touch 19
20 How our customers behave today Online Mobile Call center Social Kiosk, ATM Point of sale Postal mail 20
21 How our customers expect us to behave Online Marketer Mobile Call center Social Kiosk, ATM Point of sale One person behind all the channels, guiding the dialogue and relationship Postal mail 21
22 In reality, here s what our customers experience Marketing Online Mobile Call center Social Kiosk, ATM Point of sale Postal mail agenda strategy agenda strategy agenda strategy agenda strategy agenda strategy agenda strategy agenda strategy agenda strategy data tech data tech data tech data tech data tech data tech data tech data tech 22
23 Leading Marketers are working to create systems of engagement that Satisfy and delight customers because they deliver experiences: that are personalized and relevant which feel like a service Facilitate hyper personalization across millions of customers and interactions Enable constant testing and adjustment of tactics When this is done well, your employees naturally deliver on your brand promise, your customers become your advocates, and they cascade the positive effect 23
24 Business concept shift from 1:1 Marketing to Continuous Customer Engagement 1:1 Marketing Continuous Customer Engagement Marketing Controlled and planned (campaign focused) Loyalty programs Opportunistic and reactive Micro segment personalization Owned (addressable) media All customer interactions Agile (customer focused) Inferred loyalty Sensory, real-time, and location aware Contextual hyper-personalization Paid, earned, and owned media 24
25 Continuous Customer Engagement means systematically interpreting and evolving a comprehensive understanding of an individual in order to engage that individual in a productive manner in any brand interaction Is the customer in market now? How should I differentiate my treatment of this brand advocate? What is the potential of this customer? Is the customer willing to advocate for my brand? How does the customer perceive my brand? Is my product delivering value to the customer? What is the right product for this customer? Does the customer have enough information to make a decision? Will the customer act if we make an offer now? What price should I charge? Does the customer need help now? Is the customer using my product effectively? 25
26 Systems of engagement matter because when you get it right every interaction becomes valuable. Marketing becomes so natural that it s experienced as a service. 26
27 27
28 Imperative 3: Designing your culture and brand so they are authentically one 28
29 In the past, when someone had a bad experience with a company, only the individual would experience it. Now, the world can know instantly. 29
30 THE TWEET THAT KILLED MY COMPANY 30
31 Marketers have always protected the brand promise. Now, we have to pay equal attention to every employee and to everyone in our supply and distribution network each one is now a touchpoint. Brand Customers 31
32 In a world of total transparency, that task is on a much different scale. We must build authentically great companies and, therefore, great brands. And that starts with culture. Employees Customers 32
33 Every day, millions of actions driven by our culture influence what others think of our brand. An internal memo is leaked to the media An influential blogger has a bad customer experience Now, we must become skilled at understanding how our institution is being discussed in the public realm. Marketing has an opportunity to be an integrating function and also a force for transformation. 33 Advocacy groups reveal an unethical practice in the supply chain
34 The three imperatives of a new profession Understanding each customer as an individual. Creating a system of engagement that maximizes value creation at every touch. Designing your culture and brand so they are authentically one. 34
35 The Future practice of Marketing the CMO + CIO Partnership New Marketing Machine Has Powerful Engine, But Bad Drivers, Few Mechanics 60% growth in marketing analytics spend over the next three years $1.5 trillion spent on marketing in 2011 $148 billion in IT-related spend influenced by CMOs The C-Suite will demand that the CMO produce both a strategy and a plan for how market-driven data will significantly contribute to corporate objectives IDC CMO Predictions 35
36 Here s to the future. 36
37 Elana Anderson Vice President IBM Enterprise Marketing
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