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Archive for the ‘Branding’ Category

Churchill ClubSAP’s CMO stated, “you are dead if you aren’t a customer led organization,” while Intuit’s CMO stated “Intuit’s marketing team serves as growth officers.” An interesting discussion ensued around marketing’s role in shaping the customer experience and the related organizational implications at the CMO Agenda 2013 Summit in Santa Clara on July 31, 2012. Distinguished speakers included Jonathan Becher (CMO, SAP), Nora Denzel (Senior VP, Big Data, Social Design and Marketing, Intuit), Anne Globe (CMO, DreamWorks Animation), and Lorraine Twohill (VP Global Marketing, Google).

One of the pressing issues CMOs face this coming year is whether or not their organization is truly customer centric. Two years ago, I covered the topic of the [Global] Total Customer Experience at the Smart Seminar on Globalization, which led to a feeling of deja-vu as I listened to the continuing customer experience challenges these CMOs discussed. In short, the total customer experience represents the consumer’s brand perception through the total accumulation of experiences that an individual has with the brand across every interaction point. As the number of touchpoints have increased, such as with the introduction of social and mobile, brands have less control over their message. Furthering this problem, poorly aligned and fragmented organizations can easily introduce policies and processes that result in needless friction in the user experience. This has upended marketing and created an organizational gap – who should own the total customer experience? Once that is determined, it is much easier to create brand experiences that go beyond simple utility and truly delight the customers with deep, emotional benefits that transform them into avid fans and loyalists.

Evidence that marketing is attempting to become more customer-centric abounded at the talk with questions raised such as:

  • Should marketing own P&L responsibility?
  • Will marketing disintermediate sales?
  • Does marketing have a role in defining product experiences?

There was considerable support behind making marketing accountable for P&L, while there was an appreciation that marketing would not make a hostile move such as taking over an organization role such as sales. What is clear is that organizations within the firm must work much more closely together to deliver a total customer experience across product experience and marketing channels, which means the separation of such roles will become murkier over time. Traditionally, marketing often assumes the role of being the outside voice of the customer even if there is no clear mandate in place. Now with a near consensus that organizations must pay attention to the total customer experience, the issue of organizational ownership has been raised. If marketing takes ownership over the total customer experience, how do we as marketers define the role and measure its success? Although there are few “C” level positions focused on customer experience today, the numbers are expanding and I expect the role to evolve. Perhaps more importantly, we may want to ask the question: what do we do while we wait for this new corporate position to be introduced into our organization, given we know its importance.

In an upcoming blog, I will address three things you can do to make your firm more customer-centric before your “C” suite is in order:

01. Include your customer in design.
02. Build a healthy relationship with your customer before setting sales targets.
03. Establish an agile marketing organization.

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John Schneider at the Shopper Marketing ConferenceI attended the shopper marketing conference at Old Navy Pier in Chicago from October 16 – 18. Shopper Marketing focuses on the shopper’s path to purchase, or said another way, the moment when people are in shopping mode. There is an important distinction between consumer marketing and shopper marketing with respect to focus, since the shopper is not always the same as the consumer of the product.

On face value, one might think shopper marketing theory largely focuses on the in-store shopping experience with marketing tactics such as point of sale displays. It was refreshing to see how much shopper marketing is evolving by embracing the entire shopper ecosystem. With 91% of smartphone owners less than 3 feet away from their phone year round, rich ecommerce experiences can be had instantly. To support the point that offline and online commerce are blurred, I was a bit surprised at the statistic that 54% of Wal-Mart shoppers visit walmart.com before going into the store.

People are seamlessly swimming through channels from consumer to shopper to advocate and back again, giving them all the power. Mobility enables product, pricing, and promotion transparency at an unprecedented level even though 70% of purchase decisions are still made at the shelf. Although in-store POS displays will continue to play a pivotal role in the sales process, they will reinforce the digital message as opposed to following it. This strategy is particularly resonant for the 50% of shoppers who already use the Internet, while physically shopping in-store.

This new connected consumer forces firms to shift from a brand centric strategy to a solution centric approach that is focused on a much broader and deeply connected system of in-store and online brand touch points.

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As consumers of digital content, we are all overwhelmed with a myriad of subscription and a la carte procurement options for accessing the movies and TV we want. Unfortunately, no one has the complete solution just yet. Hulu gives us a lot (not all) of the content from Fox, NBC, and ABC but generally lacks support of the cable operators and CBS due to unresolved conflicts with their respective business models. TiVo and other connected TV devices are reaching many agreements with content consolidators such as Hulu and Netflix, but no one has a fully integrated experience where content comes before the content provider’s brand, creating friction in the user experience.

What’s it going to take to get to the Utopia vision of watching whatever you want, wherever you want, without navigating multiple content silos or maintaining an excessive number of subscription services? Here are a few of the primary industry issues outstanding:

Effective revenue model for all parties involved

Content owners need to be fairly paid, which hasn’t happened yet. Netflix’s growth is amazing, as they have captured 60% of the movie streaming market; however, they have windowing rules that keeps desired content out of the hands of consumers too long. Without a dual subscription and ad model, they will likely struggle to establish a model that attracts desirable content and keeps everyone fairly paid.

Hulu’s ad effectiveness with respect to brand and message recall is 55% more effective than traditional advertising. This is translating to higher revenue returns for Hulu per half hour of prime time episode as compared with cable, cable DVR, and broadcast DVR; only broadcast is earning revenue higher per half hour of prime time episode today and the gap is closing quickly. For Hulu, breaking from its JV relationship with its founders is the critical next step to expansion.

It will be interesting to see what packaging and merchandising options develop with the union of Blockbuster and Dish, given the opportunity to marry strong content provider relationships with multi-channel distribution capabilities.

Maintain brand identity, but let go of brand dominance

Making users go to dozens of websites and apps will not work. Content silos must be broken down. TiVo is currently one of the best devices to make this happen as it owns the coveted “input 1” position on our TVs, meaning even our grandparents can easily get to the stuff they want to watch. TiVo’s latest product makes huge strides towards putting the content in front of users before the distributor’s brand and makes great strides at breaking down the windowing issue faced by Netflix by giving users multiple content access points. While TiVo has had many great successes, it is still a heavily considered purchase in comparison to its cable operator owned generic DVR counterparts. Recent partnerships between TiVo and operators indicates that this issue may resolve over time, as its patents and its phenomenally superior user experience are showing signs of winning out.

Emergence of open standards?

From payment systems to ad platforms, the industry may have to adopt open standards to allow everyone to play. The benefit? Ease of use for users and access to content will result in more use. Proprietary business models are great if you can make it work, however, network effects are somewhat questionable, which means being the keeper of all technology components may not be the right strategic move because movie and TV viewing has not proven to be particularly social, at least yet. We don’t care much about how many people are accessing content through the same distribution channel. We simply want the content. The fewer bills, logins, and time spent finding things, the more likely usage will increase for each player.

Blog Sources
Facts stated in this blog were gathered during executive discussions in John Schneider’s Management 162 Business Capstone course at Santa Clara University during the Winter and Spring 2011 school terms. Guests include Margret Schmidt, Vice President of User Experience at TiVo, Tom Fuelling, CFO of Hulu Networks, and Peter Moore, President of Electronic Arts. The point of view expressed in this blog is solely by John Schneider.

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