Why Telecom CMOs Feel Disconnected From Their Always-On Customers

Considering the inherent connections between telco companies and mobile customers who never without their smartphones, there is a surprising lack of links between the two when it comes to omnichannel marketing, a CMO Council report shows.

A mere 4 percent of subscriber-reliant telco companies believe they are giving their customers a “consistent, personalized and contextually relevant experience across all traditional and digital channels by leveraging persistence of information, respecting the privacy of customers, and aligning the business needs with IT,” says the CMO Council study, Getting Serious About the Omni-Channel Experience, which was based on a survey of 250 marketers—100 from telecommunications organizations and 150 from non- telco brands.

Looking at the general marketplace, 56 percent of telco industry marketers believe that non-telco companies are out-performing telco operators and communications service providers in “delivering a true omni-channel experience.”

Still, perhaps this is a grass is always greener on the other side situation. A nominal 1 percent of brand marketers say they have a complete omnichannel management model in place, something that has been a common theme in previous CMO Council studies.

“Less than 10 percent of telco marketers believe they are highly advanced and rapidly evolving when it comes being more data-driven, customer-responsive and digitally adaptive,” notes Donovan Neale-May, Executive Director of the CMO Council. “More than 25 percent list functional integration; cultural, technical and operational hurdles; and resistance to change as obstacles to evolving to a true [omnichannel management] model.”

Connecting Telcos And Non-Telcos

To bridge the gaps on crafting solid omnichannel bridges between brands and consumers, telcos and general marketers are looking for ways to partner up. More than 50 percent of telcos have partnered with non-telco brands on marketing and promotional campaigns; nearly 70 percent of those report very positive, productive and fruitful relationships with good outcomes, the CMO Council study says.

“Omnichannel isn’t a simple one-way street,” says Trevor Cheung, COO of Open ROADS Community and Vice Chair of The Open Group, which is working with the CMO Council on a program designed to instill best practices related to customer experience. “In fact, our very name reflects the complexity of omni-channel transformation: Real-time, On-Demand, All-online, Do-It-Yourself, and Social. “Delivering the ROADS experience is an experience requirement and an architectural principle and it cannot be a single department fix. Marketing, technology, and customer service must work together. We believe the mindset, culture, and really the whole ecosystem needs to work together. This is necessary to handle the new consumer generation, but also the new business generation.”

Among the report’s topline findings:

  • There have been more than 8 trillion mobile connections as of August of 2017, including machine-to-machine connections. This represents a 4.70-percent growth in mobile connections year over year (GSMA Insights).
  • There are more than 5 trillion unique mobile subscribers as of August 2017. This represents a 4.67-percent increase in unique mobile subscribers year over year (GSMA Insights).
  • These subscribers are looking at their mobile devices more than 9 billion times per day— up 13 percent year over year, according to Deloitte.
  • 8.4 billion connected things will be in use worldwide in 2017, according to Gartner forecasts. This represents a 31-percent increase from 2016. Gartner predicts that this number will reach 20.4 billion by 2020.
  • October 2016 marked the month that mobile web surpassed desktop, according to StatCounter, as 51.3 percent of all web visits that month came from mobile devices compared to 48.7 percent of visits from traditional desktop computing. By July 2017, the gap had grown to 55 percent from mobile web and 41.2 percent from desktop.
  • 163 ZB of data will be created by 2025, according to IDG, representing a tenfold increase in data. IDG goes on to predict that in 2025, 20 percent of that global repository will be critical to daily life. The prediction goes on to posit that the average connected person will interact with connected devices nearly 4,800 times per day—one interaction every 18 seconds—anywhere around the world. Making the data picture more complex, IDG also believes that 93 percent of all digital data will be unstructured.

The stats highlight the challenge that “mobile network operators” face right now as consumer behavior is undergoing a massive change in the blurring of online and offline activity.

The next generation of connection, 5G, is expected to hit the market by 2020 and reach 25 million global subscriptions by 2021, the report says. In order to reach this launch, experts believe global spending on 5G mobile infrastructure will likely reach $2.3 billion by 2021.

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Age of Amazon: Stores’ Lack Of Responsiveness Is A Prime Problem

Pretty much all brand marketers agree that “responsiveness: the ability to source, understand and then quickly react to feedback, preferences and needs” is crucial to the delivery of an exceptional customer experience as expectations driven by Amazon and the on-demand economy have shaped consumers’ views.

But all too few can say that their businesses can meet those expectations.

In a CMO Council survey of 153 senior marketing executives (54 percent of whom are CMOs), 90 percent concede responsiveness is important, if not critical, to attracting and retaining customers and maintaining competitive viability.

However, only 16 percent of marketers feel their organizations are extremely responsive to the consumer, failing to make changes to products, packaging, services and experiences based on real-time consumer requests and feedback.

Is Anyone There?

The CMO Council study, The Responsiveness Requirement: Meeting the Consumer When and Where It Matters to Drive Growth, was conducted with Danaher Corporation’s Product Identification Platform companies, examined the level of success (or lack thereof) when it comes to responding “in the moment,” whether it is a physical or digital touchpoint.

“Customers fully expect for brands to engage at the speed of light—after all, it is exceptional customer experiences from brands like Amazon and Starbucks that have proven that rapid response, personalization and real-time (or near real-time) omnichannel engagements are possible at the push of a button or click of an app,” said Liz Miller, SVP of Marketing for the CMO Council. “This is engagement at the speed of digital, and the customer expects a similar level of responsiveness across all experiences, regardless of whether the channel is physical or digital.”

In general marketers feel they are able to respond or react to consumer feedback, requests, suggestions or complaints specific to marketing campaigns in less than two weeks — which to app-centric consumers may feel like a lifetime.

For the most part, 78 percent of marketers surveyed are able to meet that expectation, with 43 percent actually saying that they are able to respond to the consumer within 24 hours, effectively setting the expectation with consumers that responsiveness is possible.

In those cases, the averages are skewed by online interactions, which are naturally immediate. When it comes to brick-and-mortars, though, that’s when the problems of immediacy show themselves.

About 77 percent of respondents admit it can take up to 90 days to respond and react to customer feedback, suggestions or issues, with 36 percent needing up to three months to respond. In other words, the equivalent of several lifetimes as far as consumers are concerned.

Source: CMO Council

Among the solutions the CMO Council is proposing to spur marketers to ramp up their level of responsiveness:

  • Starting strategic conversations internally to bring product packaging and physical touches like POP displays and promotions into the customer experience dialogue. This isn’t just about printing and getting packaging made; it must be discussed as a critical touch in a multi-touch, connected experience.
  • Setting the expectation that procurement must act as a strategic partner and not just a cost-cutter. Together, marketing and procurement must identify vendors that can meet responsiveness goals, not just budgetary ones.
  • Demanding transparency. Marketers need to develop supply chain relationships that provide continuous data streams with the intentional goal of total transparency across the supply chain to track everything from creative iteration and collaboration to works- in-progress.
  • Broadening the meaning of omnichannel to including everything from social posts to product packaging. It is time to bring physical and digital together, if for no other reason than this: The consumer thinks of us as one brand—not a physical brand and a digital one.

“With recent great advances in digital media delivery, unfortunately, the capability to make changes to physical media has been a laggard,” says Joakim Weidemanis, Group Executive and Vice President, Product Identification at Danaher Corporation. “Many people simply don’t know what’s possible until they decide it will be so. Advances in technology today allow business leaders to demand more speed, higher quality and greater transparency from their partners and vendors than ever before. Even more powerful for global brands is that such technology is available all over the world.”

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Salesforce: Email Still Works To Drive Consumer Connections, As Artificial Intelligence Emerges

“Personalization” is the primary focus of marketers in the Age of Amazon, but to actually achieve that one-to-one relationship with consumers, a Salesforce report highlights the value of one of the older forms of digital marketing: email.

Email seems like an odd touchpoint for marketers’ success as social media and messaging apps emerge as key entries for personalized campaigns. On average, the 3,500 global CMOs surveyed by Salesforce in its Fourth Annual State of Marketing report say 34 percent of their budget is spent on channels they didn’t know existed five years ago — and they expect that to reach 40% by 2019.

The reason for email’s continued relevance, even as Saleforce’s survey shows growth for video, texting/sms, and AI, is that email works well to amplify all those channels.

“Over the past two years, we’ve seen an explosion in the use of newer channels like video advertising, SMS, mobile apps, and native advertising/sponsored content,” Salesforce says. “The percentage of both B2B and B2C marketers using video advertising, for example, has risen by triple digits over the last two years.”

Despite its well-established presence in the B2C marketer’s toolbox, email is still growing at a significant rate, Salesforce notes. Email’s number two ranking among marketing professionals surveyed indicates that marketers may be testing new channels in conjunction with proven ones to find combinations that work for their consumers.

The three biggest benefits cited in the report are improved awareness, higher rates of customer engagement, and improved customer acquisition.

“Email provides a window into customer behavior — such as which emails they open, what device they use, and which offers they redeem — making it a natural candidate to leverage alongside other channels to boost personalization and engagement,” the report states.

While email, when combined with other channels, can help reinforce a message and extend reach, using the data available to craft the message can have a bigger impact.

“This is a missed opportunity for most marketers who aren’t evolving messages between email and other channels based on customer behaviors or actions,” Salesforce concludes. “About half (51 percent) of the emails they send are identical messages to what they’ve broadcast in other channels.”

AI’s Coming Impact

The Salesforce State Of Marketing report notes that 51 percent of marketers surveyed are already using AI.

A separate IDC/Salesforce analysis buttresses that report’s view that that AI will be the fastest growing channel in the next few years.

AI-powered CRM activities will drive new efficiencies in how companies sell, service, and market, ultimately expected to create more than $1.1 trillion in new GDP impact worldwide by 2021.

The IDC/Salesforce report says 2018 is poised to be “a landmark year for AI adoption.” More than 40 percent of companies said they will adopt AI within the next two years.

In addition by 2018, IDC forecasts that 75 percent of enterprise and ISV development will include AI or machine-learning functionality in at least one application.

Salesforce has made a particularly big bet on AI with the release of its Einstein project last fall. With Salesforce Einstein, AI capabilities are embedded with “every Salesforce Cloud,” the company has said. Einstein leverages all data within Salesforce—customer data; activity data from social media chatter, email, calendar entries, and e-commerce; social data streams such as Tweets and images; and even IoT signals—to train machine learning models.

“AI is impacting all sectors of the economy and every business,” said Keith Block, vice chairman, president and COO, Salesforce. “For the CRM market—the fastest-growing category in enterprise software—the impact of AI will be profound, ushering in new levels of productivity for employees and empowering companies to drive even better experiences for their customers. For companies embracing AI, it’s critical that they create new workforce development programs to ensure employees are prepared for this next wave of innovation.”

Among the key findings from the IDC report on the economic impact of AI on CRM:

  • AI associated with CRM could boost global business revenues by $1.1 trillion from the beginning of 2017 to the end of 2021.
  • This global business revenue boost is predicted to be led primarily by increased productivity ($121 billion) and lowered expenses due to automation ($265 billion).
  • The types of AI companies are planning to use, or exploring, range from machine learning (25 percent) and voice/speech recognition (30 percent), to text analysis (27 percent) and advanced numerical analysis (31 percent).
  • New jobs associated with the boost in global business revenues could reach more than 800,000 by 2021, surpassing those jobs lost to automation from AI.
  • Underpinning the adoption of AI, 46 percent of AI adopters report that more than 50 percent of their CRM activities are executed using the public cloud.
  • The United States is predicted to lead the way in new business revenue growth due to the economic impact of AI ($596 billion), followed by Japan ($91 billion), Germany ($62 billion), the U.K. ($55 billion) and France ($50 billion).

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Staples Brings In Former Agency Exec Michelle Bottomley As CMO

Staples has hired Michelle Bottomley, an executive with a background in ad agencies and financial services, as its Chief Marketing Officer.

In this role, Bottomley, who succeeds the retiring Frank Bifulco, is charged with running marketing across Staples’ channels. Among her first priorities involves helping to promote the company’s new emphasis on delivery in North America.

She will report to Staples’ CEO and President Shira Goodman.

“Michelle brings tremendous breadth and balance in the marketing profession, and has a well-earned reputation as a leader of high-performing teams,” said Goodman, in a statement. “Her strong background in business-to-business marketing, including working closely with and leading sales teams, and deep expertise in digital marketing will be critical as we transform Staples to be a solutions provider for businesses.”

Bottomley joins Staples from her post as Global Chief Marketing and Sales Officer at the human resources consultancy Mercer. She has held CMO role at credit card issuer Barclaycard after a 10-year run at Ogilvy & Mather, where Bottomley last served as COO of the WPP Group agency’s New York office.

Staples’ in-store kiosks have been part of its omnichannel strategy.

Staples Faces Wider Retail Challenges

Among the challenges Bottomley faces, along with other retailers, is driving Staples’ online-to-offline integration and discovery. Over the past year, Staples has narrowed its focus to North America, having closed down operations and ceased investments in Europe, Australia, and New Zealand.

In May, Staples launched a campaign — the fourth such national marketing and advertising effort in its 31-year history. Under the tagline “Staples – It’s Pro Time,” the marketing effort sought to connect the brand to the daily life of professionals in the workplace.

The goal was to look beyond retail and address the complete spectrum of Staples customers, from consumers to small and mid-sized businesses, and enterprise customers.

As part of Staples new focus beyond retail, Goodman recently told analysts durng the company’s Q1 earnings that it expects 60 percent of sales to come from deliveries.

Staples’ Business Lounge is another part of it the chain’s attempts to appeal to professionals.

The company has 1,225 stores, along with 40 warehouses and “fulfillment centers” across the U.S. Goodman discussed the challenging retail environment right now and how Staples plans to combat it.

“Let’s look at retail for a minute, if you take technology as an example, technology was responsible for half of our comps decline in retail,” Goodman said (via Seeking Alpha) in mid-May. “That’s both due to the industry as well us by pulling back from promotional technology, but having said that, we sold higher-end technology. Our team did an amazing job of attaching that with services. They leveraged their expertise to find the right technology for our customers, and as a result, gross margin dollars are up. And I think that is really indicative of our strategy.”

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