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3 Ways to Help CMOs Increase Consumer Engagement and Drive Marketing Performance

A Data Lens, personalized

Marketing & Data

Photo by Dollar Gill on Unsplash
Photo by Dollar Gill on Unsplash

In today’s fast-paced environment with rapid innovation and change, CMOs face challenges in measuring their marketing efforts’ impact on customer experience. According to the State of Marketing Report by Salesforce, the ability to measure marketing ROI and attribution is one of the top priorities for marketers and CMOs. To overcome this, CMOs utilize personalized data to identify new customer growth and acquisition opportunities. Personalized data can be used to enhance marketing efforts and increase revenue by targeting specific customer segments and personalizing marketing campaigns to their specific demands and interests. This allows CMOs to generate greater marketing performance and achieve higher ROI. In this article, I’m exploring three vital parts connected to this challenge:

  • Marketing Performance Metrics
  • Cross-Channel Personalization
  • Connected Data Integration

1. Measuring the Customer Experience: Selecting the Appropriate Marketing Performance Metrics

It’s not just about the product a customer purchases anymore. The customer experience enabled by a company is just as vital as the product itself. You need to shift your thinking from isolated interactions with the product or service to a more holistic and all-encompassing view of the customer journey. Notably, through the substantial shift to digital, accelerated through the pandemic, as we all know, marketers must reconsider how to deliver the customer experience and how to best measure it.

Performance evaluation has undeniably become more sophisticated over the past years, particularly with the growth of digital marketing. Marketing and, therefore, measurement begin now much earlier in the customer journey. It entails recognizing intent and influencing it quickly as part of the early phase of the purchasing cycle.

Understanding how to use more personalized data throughout the journey is essential. It plays a vital role in more innovative decision-making and driving marketing ROI. Customer satisfaction metrics are the most widely used KPI in marketing – by the way, I am not suggesting stopping to use them from now on. The challenge is that Customer Satisfactions Scores only measure results at the end of an interaction. When you think about the entire customer journey and how you want to (or, better said, NEED TO) understand the journey more holistically, customer satisfaction can’t be your number 1 metric any longer.

What is a more decisive measure to gauge engagement across a customer’s journey? Customer lifetime value.

Using customer lifetime value (LTV) as a key performance indicator, you now have a way to measure the performance and effectiveness of your campaigns. One quick aside: there are quite a few ways to calculate LTV. The most significant difference is looking at your company’s historic versus predicted customer spending. When I speak about LTV in this context, I refer to the predicted value of a customer; it doesn’t need to be for a lifetime. It could be for whatever periods are most meaningful for your Business (business cycles). I thought this was a well-written article about Customer Lifetime Value by Josh Temple.

With LTV in place, marketers now have a more robust measure to gauge if they’re effectively reaching and engaging customers and providing the experiences that the customers expect. By including LTV as a metric, marketing leaders can measure performance and effectiveness at every step of their campaigns and customer interactions.

There are numerous examples of applications of LTV – here are two illustrations of companies that have successfully employed LTV to improve their customer experience.

Netflix: Netflix applies machine learning algorithms to predict LTV by analyzing viewing history, ratings, and user demographics. They use this information to recommend content to users and to create personalized Marketing campaigns. Additionally, they use this information to predict how long a customer will remain subscribed, which helps them to tailor content and marketing strategies to their customer base.

Uber: Uber predicts LTV value by analyzing ride history, ratings, and user demographics. They use this information to indicate which customers are likely to remain active and how much they are likely to spend. This helps them to optimize their service and marketing strategies to retain customers and increase revenue.

Here are three additional examples of companies using performance metrics more innovatively beyond LTV:

Amazon: Amazon uses metrics like purchase history, customer behavior, and customer satisfaction to personalize recommendations and improve the overall customer experience and sales.

Zappos: Zappos, an online shoe and clothing store, uses metrics like response time in combination with customer satisfaction to evaluate the performance of its customer service team. This has helped them to build a reputation for excellent customer service and earn customer loyalty.

Starbucks: Starbucks uses metrics like time and engagement with its app and redemption of loyalty awards to evaluate its performance and improve the customer experience. Their focus on understanding customer behavior along their journey helps them to make informed decisions about store operations, promotions, and other functions.


2. Unlocking Business Value Through Personalized Commerce: Cross-channel personalization is necessary.

Marketing executives must evaluate not only the ‘how’ when they think of customer interactions but also ‘where’ these interactions take place. We saw a rapid acceleration in customers embracing online due to the COVID-19 pandemic, with now a wide plethora of digital channels to choose from. Most customers make use of multiple channels to engage with brands and complete transactions.

Looking at this through the customer journey lens, from the moment a customer does their initial research to purchase and finally consume or use the product, it becomes evident that digital, virtual, and physical experiences seamlessly interlace. The customer has options and indeed expects these options to be made available to them. Even more so, customers pick and choose based on their preferences at that moment – and yes, these preferences can change quite frequently – and look for companies that provide these experiences fluently. Therefore, CMOS must pursue innovation through personalized data to unlock business value. Personalized commerce goes beyond the personalization efforts we’ve seen marketers use for their communication. Involving the customer in creating and shaping brand experiences includes customizing products, selecting personalized offers, or having more control over their general interactions with a brand. The objective is to give customers more control and autonomy in their experiences. With that, marketers are empowered to create deeper and more meaningful connections, increasing loyalty and sales.

Personalized commerce goes beyond the personalization efforts we’ve seen marketers use for their communication. The objective is to give customers more control and autonomy in their experience.

To unlock these highly individualized experiences, marketers require access to personalized data. With that information, they are gaining insights and understanding comprehensively across channels and platforms to the question of "who truly is my customer." Here is one example of Amazon leveraging engagement data across multiple channels to holistically recognize their unique customers. They do this through developing highly personalized experiences:

Amazon: Amazon creates highly personalized experiences for its customers by using data from user engagement across several channels, such as website browsing, app usage, and Alexa. This enables them to understand their customers holistically across channels and platforms and discover which products and promotions will most likely stimulate engagement and sales.

One example (of many) of this integration is the following: John frequently searches for and purchases outdoor gear on Amazon. He loves to stream music when hiking in the mountains using Alexa. Based on John’s browsing and purchase history on Amazon (website, mobile app), Amazon will suggest new outdoor gear, such as backpacks, hiking boots, and camping equipment. These recommendations will also be dynamically customized further based on his interactions on Amazon as he searches, for instance, for winter gear. Additionally, when John asks Alexa to play music, it will suggest songs and playlists that he has previously listened to while hiking.


3. Unifying Your Customer Experience: The Importance of Integrated and Connected Data

In order to unlock the desired experiences as well as be able to measure their impact, your data needs to be connected and easily accessible to all of your teams. Stating the obvious, I know.

Marketers must consider that customers are always ready for new products, services, and experiences and, therefore, must prepare to deliver instantaneously against the growing customer expectations.

An integrated platform allows companies to engage with their customers in new and innovative ways. By having a single source of truth, your marketing, merchandising, and customer service teams can all have a complete 360-degree view of the customer. This sets you up to deliver a fully personalized and seamless experience that keeps your customers engaged.

But there are more than just internal benefits from integrated data. Most importantly, customers will benefit significantly from moving away from interacting with siloed departments and more towards experiencing a unified brand. No more frustration from talking to the e-commerce team like they are a different business than the stores. Disjointed experiences leave customers dissatisfied and less likely to return in the future.

Here are two examples outside the previously listed ones:

Walmart: Walmart, for example, has created a centralized data platform (CDP) that enables them to understand their consumers better and personalize their shopping experiences. They’ve also implemented a system that allows for real-time data exchange between their shops and online platforms, enabling them to respond to customer demand instantly and stock accordingly.

Sephora: Sephora has implemented a connected data platform to personalize its marketing activities and offer a more seamless online and in-store shopping experience. They create personalized product recommendations and give targeted promotions based on data on customer behavior and purchase history.

Photo by Jon Tyson on Unsplash
Photo by Jon Tyson on Unsplash

Conclusion

As a marketeer, utilizing personalized data can help you identify new customer growth and acquisition opportunities. You can enhance your marketing efforts and drive better performance by targeting specific customer segments and personalizing your marketing campaigns to their particular needs and interests.

To succeed in this endeavor, focus on selecting the right performance metrics (figuring out the right one for your business takes some time), implementing cross-channel personalization, and integrating connected data. Remember to take a holistic view of the customer journey and concentrate on creating a more personalized and engaging experience for your customers.

As always, curious to hear your thoughts, experiences, and comments.


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