Marketing Must Keep Pace With Customers
"Marketing needs a complete revamping," FreshDirect Chairman and CEO Richard S. Braddock told attendees during The Conference Board's 2009 Marketing Executive Conference. "Marketing as a discipline in woefully suboptimized in the digital age."
Although it's critically important to get close to customers today, few companies are marketing and managing with the intensity possible, Braddock said. They can't adapt to today's pace--largely due to cultural obstacles within their organizations. Companies need to completely revamp their approach, he said, and harness the real-time customer knowledge and opportunities for action that the Internet allows today. "You have to rethink your business proposition online," he said.
Most Internet marketing focuses on sales leads; too few companies use their websites to help build long-term customer relationships, he said. However, Braddock said, most visitors to a company's site are existing customers. This means there is a huge opportunity to enhance the loyalty of existing customers online, as well as to improve their profitability. "Even if you don't sell much or at all online, you can learn from the customer information gathered online to market through other channels," he said, adding that "customers will tell you virtually anything you want to know if they know you'll use the information responsibly."
Braddock emphasized that the future is online and offline continuing to come together. Unfortunately, for most companies, making that transition is "glacial," he said, "because many companies are in no rush to change--even if they profess to be customer focused."
According to Braddock, there are myriad tools available to provide marketers with real-time customer information--also noting that the pace of FreshDirect's marketing is day by day. The company adjusts its marketing daily, based on customer insight. "Few brace that intensity," he said. "Marketing processes are too lengthy and decision making too leisurely." Often, he added, there are too many analysts reinforcing that slow pace.
"Customers today operate more and more on a real-time basis," he said. "If you don't insert yourself into the process, you'll lose customers to competitors."
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It seems the common theme here is that the time has never been better--or more necessary--to learn from customers and act on that insight.
Spot on about customers operating in a real time environment. Companies are naive to ignore places that customers interact and talk about recent purchases. Social Media is an easily accessible outlet where companies can represent their brands in an honest way with minimal investment. Feedback and complaint resolution has never been more accessible.
I have just come back from running one of our full-day post-survey workshops with an international IT firm. It was an excellent session. The results weren’t good, but the team came up with a bunch of ideas, which were prioritised so that the low-cost quick-wins came first. But the best part of the session (for me, anyway) was the change in attitude of the CEO as the day progressed. Early on he was asking about statistics and benchmarking (and so were some of the directors). Don’t get me wrong; I’ve got nothing against statistics and benchmarking in their right place. But here we had a company that has just over one hundred clients with, at most, two or three key contacts at each – that to me is a 250 person Christmas card list.
We had carried out an international customer satisfaction survey on three continents in five languages for this firm and had got responses back from more than 72% - 143 responses from 200 surveys that had gone out.
I asked the CEO directly, how many of the customers he knew. He started going through the list (we have a chart of who responded; and another which lists out the serious issues, by customer; and in yet another section of the report we produce a page for each and every respondent, in alphabetical order). The first one he’d spoken to a couple of times. On the second one, he asked if e-mails counted (yes, of course). He denied knowing the third customer on the list at which point both of the people on either side of him said in unison “you do” (which was very funny to watch and got the debate going).
My point was that we were talking about people, not segments or statistics. And benchmarks can be a HUGE distraction. Forget about how you compare with ABC or XYZ – the best companies that are at the top of their game focus on long-term continuous improvement. Or, as I call it, the Toyota mountain of a thousand little ideas.
By the end of the workshop my new best friend the CEO was setting a target for the overall satisfaction question – “On an overall basis, how satisfied are you with our company?” (this question has been included in every single survey that InfoQuest has conducted since 1989 and it is always posed last – it’s the last card in the deck, so it gets a very considered response, as the responder has already been through up to 59 other questions and statements about the business relationship of the two entities). The directors and senior managers (15 of them) were balking at the target being proposed by the CEO. The CEO was talking about a 20 percentage point increase by the time they repeated the survey next year. His team said that was too tough and it should be reduced. Then he came out with a marvellous statement.
The CEO said that to get the 20 percentage point increase they simply had to move 30 individuals who were currently “somewhat satisfied” into being “totally satisfied”, adding the magic “That’s just two contacts for each person sitting round this table. Who’s telling me that we can’t do that?”
I’ve had clients that have segmented their customers between desktop and mainframe applications; those that have received consultancy in the past year and those that haven’t; new customers versus legacy customers; Gold, Silver and Bronze customers (whatever the hell they are); and those where there is between 12 and 24 months of a service contract left to run. These segments are all useful to an extent (well, nearly all) in that they provide labels that my client is comfortable with. But in business to business, where there aren’t that many customers and they all need and want slightly different things, please just treat them as individuals!