The $6 Trillion CMO: 3 Ways To Put Personalization Into Hyper-Focus
“We can rebuild him. We have the technology. We can make him better than he was. Better, stronger, faster.”
Somewhere, along the way to making retail faster, frictionless and more personalized, technology has transformed the chief marketing officer into a version of the $6 million man. Actually, make that trillion.
That is the amount consumers are expected to spend on apps alone by the year 2021 — $6 trillion. And with each handheld interaction, their expectations of efficient personalized experiences will elevate. Yet it’s just one of many emerging data streams retail CMOs must manage to better understand their shoppers.
It’s little wonder that many merchants are conflicted about how to approach, and manage, customer personalization. The result is a retail chief marketing officer who is forced to act as a super-hybrid — half brand marketer and half systems integrator.
The result may also be high turnover. In the first half of 2017, 187 marketing-leader appointments were made, according to Russell Reynolds Associates (RRA), which analyzes CMO moves twice a year. That is the greatest number observed since RRA began tracking close to five years ago.
Core to the conflict are incongruous commitments to personalization, arguably among the most important factors for effective marketing.
Consider these recent survey results of 146 retail, commerce and media executives by the digital marketing firm Sailthru, which specializes in customer engagement. From the gate, we see different business philosophies regarding the role of personalization:
- 61% of those surveyed view personalization as a business strategy, while 39% think it is a marketing tactic. The good news is more are seeing it as a long-term strategy and not a tool.
- Fewer than half, 47%, said they use personalization technology to deliver one-to-one communications.
- 42% believe lack of resources (such as time, people and budget) is a primary barrier to effective personalization; 23% say collecting, structuring or using data are major hurdles to achieving even a minimum level of personalization.
- It’s not surprising, then, that 60% believe it is critical to involve an analytics team in the process.
Technology Is Not Enough
However, based on the Sailthru research and other trends, analytics technology alone might not be enough to empower CMOs to meet the shopper’s preference for a one-to-one “you’re special” kind of engagement.
Rather, they’ll need the backing of their entire organizations.
The chief reason for so much backing is that personalization is not a short-term tactic, regardless of what 39% of business respondents believe. It requires years-out planning, and therefore a culture that will spearhead and oversee implementation.
Consider that 60% of the Sailthru respondents (111 of which were retail executives) pointed to their data science teams as the best for the personalization job. That so many recognize the need for data scientists may reflect the extent to which merchants feel stymied by their data-use abilities, or inabilities. However, six in 10 is a pretty low number.
All of them should all be enrolling data scientists in the job of warming up to the customer. How else do they expect their marketing teams, whom 80% of respondents said are important for implementing personalization efforts, to parlay all that data to its best use?
The fact that just about half of those surveyed (51%) said their information technology teams are key to personalization underscores the blind spot.
How To Build A Better CMO
The fact is, to build a better CMO, a retailer needs to enroll the talents of pretty much all departments, as well as vendors and even customers. Personalization takes a community. Here are three ways to build one:
Begin at home: There is no reason for the marketing department to hoard customer data. The store planning, product development and merchandising departments could find opportunities in it as well. For example, by overlaying purchasing patterns, retailers can learn not only what brands their customers prefer, but also what significant lifestyle changes they experience, how they navigate the store and what kinds of communications and price points they respond to. This information can inspire personalization efforts in unexpected places, including the aisles (thanks to beacon technology), assortment and promotions.
Reach out to neighbors: Retailers can share their customer insights beyond the boundaries of their organizations with vendors and other partners whose information, when combined, could help all of them better tailor the shopper experience. Retailers at the same time can engage their shoppers in a dialog by inviting and responding to their preferences and other information in both one-to-one and social environments. When shoppers are given an acknowledged role in the experience, they are more likely to feel empowered and invested in the brand.
Be a good role model: Personalization requires earning the shopper’s respect and trust. Data is essential to achieving this, and good data management is crucial to retaining it. Shoppers increasingly expect more transparency from their brands, and that extends to how their information is used. Retailers that are upfront about the information they collect and how they apply it to better serve the customer will avoid the hairy eyeball of suspicion. They also make an overall cultural shift, from an organization dedicated to building a business to one dedicated to building customer ties.
Which is just another way of saying community. Personalization may require the transformation of the CMO’s role, but it also demands a change in how an entire organization — and its partners — operates. Being better, stronger and faster just helps achieve that.