2019 tech trends

Beyond marketing: Experience reimagined

CMOs and CIOs partnering to elevate the human experience

January 16, 2019

In the new world of marketing—personalized, contextualized, and dynamic—CMOs are partnering with their technology organizations to bring control of the human experience back in house, with a fresh arsenal of experience-focused marketing tools.

The new world of marketing is personalized, contextualized, and dynamic. Increasingly, this world is orchestrated not by outside parties but by chief marketing officers partnering with their technology organizations to bring control of the human experience back in-house. Together, CMOs and CIOs are building an arsenal of experience-focused marketing tools that are powered by emerging technology. Their goal is to transform marketing from a customer acquisition-focused activity to one that enables a superb human experience, grounded in data. In experiential marketing, companies treat each customer as an individual by understanding their preferences and behaviors. Analytics and cognitive capabilities illuminate the context of customers’ needs and desires, and determine the optimal way to engage with them. Experience-management tools tailor content and identify the best method of delivery across physical and digital touchpoints, bringing us closer to truly unique engagement with each and every human.

Imagine a world in which a brand knows who you are and what you want, and can deliver the product, service, or experience that best suits your needs seamlessly and in real time, across physical or digital channels. This world has arrived.

Marketing technology is undergoing a renaissance. Channel-focused solutions such as websites, social and mobile platforms, content management tools, and search engine optimization are fast becoming yesterday’s news. As part of the growing beyond marketing trend, organizations are adopting a new generation of martech systems that deliver unprecedented levels of customer intimacy, targeted engagement, and precision impact. By deploying new approaches to data gathering, decisioning, and delivery, companies can now create personalized, contextualized, dynamic end-to-end experiences for individual customers. These experiences, in turn, can help customers create deep emotional connections to products and brands, which drive loyalty and business growth.

With its emphasis on the human experience, the beyond marketing trend represents a turning point in marketing strategy and practices. Traditionally, marketing’s broad goal was to bend consumer will in ways that advance a seller’s strategy. Going forward, its goal will be to adapt the seller’s objectives and methods of engagement to meet specific customer expectations—expectations formed on a deep, sensory level. How deep? Consider this: The human eye is capable of seeing more than seven million colors, our ears can sense when two notes are ever-so-slightly out of tune, and 20 million nerve endings allow us to feel everything. Humans are sensory creatures, our lives lived through experiences. When it comes to companies communicating and connecting with people, logic and system limitations have sometimes trumped emotional intelligence. Reclaiming the human experience and reconnecting with emotion are on the rise. Brands are expected to understand wants, needs, and previous interactions. An optimal brand experience demonstrates emotional sensitivity and sets the bar for all brand expectations moving forward, regardless of category or sector.

To meet these expectations, some companies are looking beyond longstanding relationships with marketing services providers (MSPs) and ad agencies, and are bringing data management and customer engagement processes back in-house. Likewise, CIOs and CMOs have begun collaborating more closely than ever and are aligning their companies’ marketing, business, and broader digital strategies. They are trading in “black box” customer marketing solutions for cloud-based, flexible, automated marketing systems that offer greater control of data. Organizations farther along in their beyond marketing journeys are exploring opportunities to integrate first-, second-, and third-party data, cognitive analytics, machine learning, and real-time/right-time touchpoint delivery into their data management stacks.

During the next 18 to 24 months, expect more companies to launch their own beyond marketing journeys. Established organizations may start by launching pilots in individual brands or by consolidating vast volumes of consumer data that are currently spread across enterprise systems and operational silos. Startups might launch greenfield efforts by defining what the optimal consumer experience can be, and then working to make it real.

Organizations, large and small, will likely shift their marketing technology exploration and use case development into high gear. Going forward, consumers—not marketers—will be behind the wheel.

My way or the highway

Constant online access is dramatically changing customer expectations. Customers want personalized experiences and communication, delivered when and how they want it. In a CMO Council/SAP survey, 47 percent of respondents said they would abandon a brand that delivers poor, impersonal, or frustrating experiences.1 In response, CMOs are allocating nearly a third of their budgets to marketing technology.

Across industries, we are seeing companies use a variety of technologies to enhance their customer experiences. For example, clothing retailer Nordstrom recently debuted a digital shopping experience platform that uses smartphone shopping application features to enhance in-store experiences. Customers might see an article of clothing they like on social media; using the Nordstrom app, they can contact their personal Nordstrom stylist, who will direct them to the closest store that has the item. When the customer arrives at that location, they will find a dressing room with their name on the door, and the item inside, ready to be tried on.2

In sports, the Kansas City Chiefs are using a decision cloud rooted in machine learning and artificial intelligence to improve the fan experience. “The platform allowed us to connect multiple levels of fan data to many different offers, promotions, and solicitations,” says Tyler Kirby, Chiefs VP of ticket sales. “Ensuring we were delivering our content to only those fans who would be most likely to purchase, and equally as important, not cannibalizing our retail sales. The audiences identified were valuable for all email, paid social, and lead distribution efforts to our sales team.”3

Tech-enabled CX initiatives like these are becoming common as a couple of factors push the beyond marketing trend forward. First, traditional ad agencies and other MSPs are struggling to deliver integrated experiences across sales, marketing, and data. In some cases, legacy data management systems cannot support real-time access and decisioning; in others, siloed organizational functions prove inefficient in the digital age. The problem of silos is exacerbated in larger organizations, as MSPs can’t easily look across product lines, business units, functions, and geographies. As a result, more companies are exploring opportunities to bring data-management and customer-engagement initiatives back in-house.

At the same time, technology has created a multitude of ways to engage customers on their paths to purchase. But the tech stack required to engage and deliver an end-to-end customer experience can be incredibly complex and challenging if not developed within the parameters of a digital strategy. CMOs are increasingly owning the delivery of the entire customer experience—including CX systems—and are finding themselves taking on facets of the traditional CIO role. At the same time, CIOs are being called on to transform legacy systems and build new infrastructure to support next-generation data management and front-office customer engagement systems. How does this impact IT’s mission and broader digital transformation strategy? How can IT and marketing ensure security, data integrity, and adequate tech support in this environment? As organizations travel farther down the beyond marketing path, CIOs and CMOs are finding they will have to collaborate more closely than ever in order to deliver not only on their company’s new marketing strategies but on established digital strategies.

CIOs and CMOs partner to reimagine human experience

The three Ds

From a technology perspective, this trend involves the infrastructure around data, decisioning, and delivery that your company will need to meet consumer expectations.

  • Data. In beyond marketing, data is the starting point for all efforts. Greater volumes of diverse data—in an environment that a company controls—make it possible to develop a deeper understanding of customers and individual preferences and behaviors. Think about the customer information your company may have in its systems: names, email addresses, responses to marketing campaigns, past purchases, post-sale contacts, and the outcomes of those transactions. (Were the products returned? Did the customer engage the company for any reason after the sale?) These are basic elements of a customer profile that can be enhanced with public or third-party data, all while complying with today’s stringent privacy standards.

    Knowing each customer’s age range, gender, and location can help you compare their purchase history and preferences to others in the same demographic group. This analysis helps build a more complete picture of customers engaging with your brand. The process for gathering, integrating, and enriching audience and customer data will vary according to each organization’s capabilities and needs. But in general, after ingesting and transforming data from a myriad of sources, you can link each data transaction to a unique customer identifier. This data can then be stored in a customer data platform for use in decisioning and delivery.

  • Decisioning. Through advanced analytics, audience management, and real-time personalization and decisioning engines, the system can determine how and when to provide an experience to a potential or known customer that optimizes value to the customer and the company. This goes beyond simple creative copy, image, and messages. It can also include pricing, promotion, and unique services and offerings being presented to a customer. Integrating machine learning capabilities into the decisioning process can help the system further refine the company’s understanding of the customer—and of the effectiveness of experiences already delivered. Finally, decisioning should include necessary hooks into inventory and logistics systems to ensure that products and services being offered are actually available and can be delivered quickly.

  • Delivery. Following data transformation and decisioning, content management and campaign experience management tools orchestrate delivery of dynamic CX content consistently across channels such as email, text, and customer portal. It also integrates with interaction channels like call centers and mobile apps. In some environments, this process can be largely, if not completely, automated. These delivery interactions ultimately create customized, personalized human engagement.

What does this mean for IT?

Reengineering your company’s current approaches to data, decisioning, and delivery does not require ripping out your legacy technology stack and replacing it with a host of shiny new tools. Rather, your goal should be to integrate the technologies and processes that can make your existing systems smarter and provide real-time, seamless interactions with customers. There are some black-box data solutions that you can bring back in-house, and those can and should live in the cloud. But for many companies today, these changes are already taking place as part of broader digital transformation strategies. Whether it be analytics, cognitive, or cloud, the technologies that are driving the beyond marketing trend are likely driving other transformation initiatives in your organization and have been for some time. Look for opportunities to leverage in-flight digital investments and evolving IT talent.

Over time, the beyond marketing trend may require rethinking, redesigning, or reimplementing your current channel systems to support more tailored and personalized touchpoints. Supporting the journey to create more emotionally intelligent interactions often requires different approaches for delivering messages and content. Promotions will become more dynamic, potentially requiring changes to core systems that were configured for a less personalized world. Analyzing your portfolio of systems for potential “pinch points” today will be important to supporting better velocity in the future.

Supporting the analytics, machine learning, and artificial intelligence capabilities that underlie many of the decisioning systems will also likely require evolving your current approach to IT talent. The technologies and techniques that are driving your organization’s AI-fueled transformation will also support marketing decisioning. Getting ahead of the curve by training internal resources and identifying external support will be key. Moreover, marketing and IT will also need more CX talent, which warrants a discussion to identify where and how those individuals can be most successful.

Lessons from the front lines

USTA’s match point: A grassroots digital marketing strategy to grow the sport of tennis

Since 1881, the United States Tennis Association (USTA) has fulfilled its mission of growing the sport primarily by building its membership base of active players—administering amateur tournaments and developing adult and youth programming that requires participants to join the organization. To continue to grow the game, the organization has more recently broadened its lens to create relationships with coaches, teachers, tennis fans, and players’ parents, along with players of all ages and abilities.

“If we can get people—no matter where they are in their tennis life—into the right activity with the right training, people will play the sport throughout their life,” says Kevin Mahoney, managing director of digital at the USTA.4 In order to do that, he says, the organization has to build a personal relationship with anyone who might pick up a tennis racket, get them on the court, and keep them coming back.

To match each individual with the perfect experience, the USTA has implemented a personalized marketing strategy that required a transformation of the USTA digital network. To support its efforts, the USTA has built out a data lake to collect information from a variety of touchpoints on and off the website—event registration and results, purchases and search history—and created a single view of each customer. This single view enables the USTA to understand player participation patterns and to facilitate a specific tennis experience for each person. Next, the organization initiated a campaign encouraging players and others involved in the sport—including nonmembers—to register at USTA.com.

“The better we understand how an individual has interacted with the site, the better positioned we are to offer the right opportunity—whether the individual is a fan, a college varsity player, or a senior picking up a racket for the first time—based on that history,” Mahoney says. “For example, we’re able to target the parent of a junior team tennis player who likely won’t want to receive messages about improving their own backhand, but instead is interested in a new junior team being organized or a coach offering junior clinics in their city or town.”

This approach has been deployed within Net Generation, the USTA’s official youth tennis brand, centered around giving kids the skills to be great, on and off the court. To date, Net Generation has more than 300,000 registered USTA accounts, accomplishing this in a little over a year. And as the USTA collects more relevant information, it becomes easier to create customized experiences, matching players with coaches, teams, tournaments, facilities, and other resources to expand their playing opportunities.

The USTA is also using its newly developed marketing tools to broaden its digital offerings beyond its core member universe. As a part of the Tennis 2020 initiative, the USTA will give providers—such as coaches, equipment manufacturers, and facility managers—tools, such as web page development and scheduling software, to better target offerings and grow their businesses.

“Over the next couple of years, we’ll connect the dots, building a data-driven culture as we push digital products into the market to support the USTA’s programs and the growth of the sport,” Mahoney says. It has been a journey to change the direction of an organization that’s nearly 140 years old, but the USTA is embracing the digital age to create products that enhance its sport and get more people on the court.

Appetite for data: Tyson Foods’ customer-driven digitalization

After 85 years, Tyson Foods is growing an appetite for digital transformation that is dramatically evolving how the company serves its customers and reaches its end consumers. Generational preferences for meat protein and variable patterns of demand are creating a market shift. At the same time, availability of social media and other big data, along with advances in analytic tools, cloud, and cognitive technologies such as machine learning, are all changing how the company predicts, influences, and responds to market behavior.

For Tyson Foods, digital transformation is consumer-driven, and according to CTO and executive VP Scott Spradley,5 this means evolving the whole technology stack. Having better insight into customer behavior while digitizing the supply chain enables the company to more quickly respond to demand fluctuations; as part of that, the legacy analog company is reimagining how it markets to customers. “Intelligent marketing is driven by analytics; digitizing the entire process is needed for us to gain insights into the market,” Spradley says. “We are pursuing efforts to digitize structured and unstructured data sets—including information about the weather, sporting events, and life events—that will allow us to be much more predictive of the specific demands of our consumers and more accurately plan what, how, when, and why we market.”

Tyson Foods recognizes that many demographic factors drive preferences and consumption patterns, making personalized marketing even more critical. Consumers have unique touchpoint preferences and triggers that motivate them to buy. To predict diet preferences and consumption patterns, the company is delving into how age groups use media, even segmenting within those age groups, such as distinguishing between millennials who use Twitter from those who use Instagram.

Spradley and his team recently concluded a pilot in which they analyzed a variety of social media feeds to determine trends that lead to “food acquisition events,” or consumer purchases, across multiple demographic groups and compared the results with third-party market research. The information will be used to hone marketing efforts to better forecast and influence buying patterns—from more traditional food acquisition events such as holiday, football tailgate, and summer grilling seasons—to more specific, local activities that prompt consumers to purchase food: concerts, amateur sporting events, political rallies, and birthdays. Better forecasts support improved supply chain management—from fine-tuning meat production to distribution, including preventing stockouts and minimizing wastage at grocery stores.

Understanding the market itself has also required Tyson Foods to transition its IT talent model. New skill sets, including both statistical application and a broad comprehension of macroeconomics to help identify economic impacts within data sources, are now essential. The company is meeting these needs by expanding current workers’ knowledge base, as well as acquiring a new data sciences team.

“The complexity of the food chain—from farm to fork—can truly be understood with digital capabilities,” Spradley says. “Rich data stacks, strong talent, and emerging technologies are allowing us to establish a new normal around thinking and planning. As we move down our transformation road map, our hope is that Tyson Foods can move faster and cheaper, resulting in lower end prices for the consumer.”

My take

Jim Fowler, CIO, Nationwide Insurance

Insurance is, by definition, a very personal business. Since selling its first policy to an Ohio farmer in 1926, Nationwide Insurance’s mission has been to help its members protect the things in their lives that matter most: their homes, cars, businesses, and retirement savings. Today, with 30,000 associates and more than US$230 billion in total assets, Nationwide’s mission remains the same, though the list of insurable things that matter to our members has grown to include pets, motorcycles, boats, digital assets, and much more.

Just as our members’ lives and personal circumstances have evolved, so too have their expectations of Nationwide. Like many other sectors, the insurance industry is being disrupted by changing consumer attitudes and buying behaviors. Consumers increasingly expect companies to tailor products, services, and buying experiences to meet their personal needs and tastes. It is no longer enough to buy high-quality leads from list providers. You need to meet members wherever they want to make the purchase with a product that is customized for the individual.

Going forward, the only way we can succeed is by using data to create a unified view of each customer and connect our services to all the stages of their lives. Take, for example, my daughter. After graduating from college in a couple of years, she will have her first experience with an insurance company. She will probably buy renter’s insurance and auto insurance. A few years later, she may get married, have children, and buy a house, so she might purchase life and homeowner’s policies. Like many in her generation, she will probably change jobs five or six times over the course of her career, so she may need to roll over her 401(k). Later in life, she may want to look at annuities. It is critical that Nationwide meet her at each of these important life stages, and data is at the heart of how we can make that possible.

To harness data’s full potential, Nationwide has had to rewrite every underlying transactional system. Whether these systems supported retirement plans or insurance policies, they were grounded in 1980s-era mainframe technology. Upgrading these transactional systems has been a critical investment. We have also made IT organizational changes, specifically with a move to agile development. Within our IT organization, 100 percent of our lines are now agile. We have expanded these agile lines to include our internal business partners, who provide invaluable process and product expertise as we develop new capabilities. And because we know that customers are going to research, purchase, and manage their policies through different channels such as independent agents and advisers, we established a technology strategy that enables us to meet members in new channels digitally. Now our members can access our products where they choose.

For those who are considering a transformation journey of their own, I can offer a few bits of hard-earned wisdom. First, the CMO and CIO are not adversaries—they are partners. It is in the best interest of any company, its employees, and its customers for this relationship to work well. Break down divisions that exist between IT and marketing, because when the two teams collaborate as partners, they will be able to reach shared goals much more quickly. In our customer-facing teams, it’s difficult to tell who is from IT and who is from marketing. That is driving huge success for our customers.

Secondly, recognize that data is at the very heart of this journey. If you do not have a strong team focused on connecting the data elements around your customers, you are going to have a hard time competing in your industry. Moreover, you should develop guidelines for using data ethically. We constantly review and discuss ethical boundaries to determine how we will and will not use customer data. This is a conversation that you should have before you get too far down the road of products and services—otherwise you may find yourself at odds with customers, regulators, and public opinion.

Finally, the C-suite—just like IT and marketing—must be willing to disrupt its own status quo. At Nationwide, every executive is actively engaged in our transformation efforts. This includes our board of directors, who meet six times a year to discuss ongoing technology initiatives. They, like the entire leadership team, recognize that our industry is in the midst of a profound shift—one being driven by consumers.

Risk implications

It is becoming increasingly apparent that marketing and customer experience professionals understand that identity management not only is foundational to their organization’s survival—it can be a key contributor to market growth by differentiating the company’s brand, products, and services. Great customer experiences rely on identity management, and done right, it can provide a secure and seamless experience with access to what customers need, when and where they need it, and from any device. However, those in the enterprise charged with protecting privacy and security need to appreciate the significant risks around the collection, storage, and management of data and consumers’ digital identities. As stricter privacy and consent regulations go into effect around the globe, and the incidence of fraud and cyberattacks proliferates, organizations must balance customer experience and usability with security and risk management. There are three common drivers that have transformed cyber risk into a strategic business consideration:

  • Fraud and cyber threats born from stolen credentials. Stolen passwords are the most vulnerable touchpoints when it comes to customer engagement and experience, primarily because the entities responsible for creating secure passwords and keeping them secure … are human. Even after years of warnings, people share, reuse, forget, and fail to secure their passwords.

  • Limiting friction while securing data at multiple touchpoints. Organizations struggle with being able to offer a user experience that is simple and seamless yet still secure. For example, when users are asked to opt in to more rigorous security measures to protect their identities, there is a risk that the process will add friction and the consumer will give up and log off—or, worse, move onto a competitor. Adding front-end security, such as site registration or multifactor authentication, as a knee-jerk reaction to breaches reported in the news, may clutter the customer experience while failing to fix identity security issues.

  • Regulation as a market force. The need to keep pace with regulatory and compliance demands for protecting consumer data and preferences, such as the sweeping General Data Protection Regulation (GDPR) and California Consumer Privacy Act of 2018, requires organizations with consumers and users all over the world to develop a comprehensive strategy ensuring security and privacy. This could mean hiring experienced compliance professionals and investing resources to meet and exceed regulations—beyond traditional consumer protections—that have not existed before.

Perhaps the biggest lesson to learn from organizations that have responded well to these drivers is this: Personalization and brand experience are important, but the responsibility of protecting customers’ privacy is not just the responsibility of the chief security officer. To survive and thrive in the marketplace, the entire C-suite—from the CEO and CFO who drive growth and value; to the CISO, CTO, and CIO who innovate to keep data and systems secure; to the CMO who owns the implementation of consumer engagement strategies—should be invested in creating a unified enterprisewide approach to customer identity management.

Simply put, customers who trust you will give you more data. More data means more insight, and more insight begets better engagement—which, ultimately, generates more revenue.

Are you ready?

For even the most knowledgeable CIOs and CMOs, developing and implementing new approaches to data, decisioning, and delivery is rarely a light lift. Luckily, you don’t have to take the entire effort on at once. As you explore the possibilities that the beyond marketing trend offers your company, ask yourself the following questions:

This trend represents a big change in the way my company engages customers. What initial steps can I take to lay the groundwork?

First, define what an optimal experience would be for a customer engaging your brand, and use this to create a vision and guiding principles for the journey ahead. How do your current operations align with this vision and set of principles? To what extent can your current CX tech portfolio—martech, CRM, social platforms, e-commerce—support your vision, and where are there gaps? The same goes for your existing strategies for customer engagement. Once you have identified gaps, you decide which ones to prioritize—maybe start small by going for quick wins that can demonstrate value to leadership and detractors. From there, you can broaden the scope of your initiative with more ambitious milestones and timelines. Whatever your approach, remember: Deploying the tools and tactics you will need to deliver tailored experiences to customers is not easy. Beyond deploying new technologies and processes, it may require shifting mindsets and aspects of your company’s culture. This is a journey, one that begins with a few steps.

What are some quick wins I can achieve?

There are opportunities for quick wins across the board—for example, lowering the cost of customer acquisition, enhancing customer engagement, or driving greater customer retention and loyalty. You don’t have to launch a huge transformation initiative tomorrow. Instead, consider starting with a single channel like the call center, emails, or mobile apps, and focus on a specific desired outcome. Maybe you can complete more upsells or get higher click-through rates. With these small successes under your belt, you can further develop use cases or launch pilots. Another quick win—though one that can be a bit more involved—is consolidating your data. In many companies, human data lives in operational silos, discrete systems, and with third-party vendors. Consolidating this disparate data in a cloud-based data lake and identifying one owner is an essential step you will eventually have to take in any beyond marketing journey. Why not start now?

As I reengineer my company’s marketing operations to deliver individual experiences, how will I know if I am succeeding?

The beyond marketing trend is about truly knowing individual customers on a one-to-one level and using that knowledge to deliver personalized experiences every time they engage with your brand. Success in this arena means developing the ability to collect data from all interactions that a customer has with your organization—think of responses to marketing campaigns, sales interactions, customer service calls, and online brand engagement, among others. With advanced analytics, you will be able to develop a highly nuanced understanding of customer behaviors and preferences, which you can then use to tailor the interaction experiences you offer each customer. As an example of a successful experience, consider a life sciences company that segments its customers into broad archetypes, such as collaborative and competitive. Someone in the competitive archetype may respond better to a gamification technique that encourages healthy choices and adherence to a health regimen. Others in the collaborative archetype group may respond to messages that offer anecdotes and human-interest content. With archetype designations identified, the company can tailor content, messaging, and interactions to individual people based on their needs.

Who in my company should ultimately “own” the human experience?

A brand may decide to share ownership of the human experience across functions, including marketing, sales, and service and establishing a cross-functional leadership council, while other companies may expand the role of the CMO to own the human experience; some are adding a chief experience officer to the C-suite. In any case, the ownership must be clear, with metrics in place for accountability and to measure value.

What will humans continue to do versus machines in my company to enable this trend?

Marketers and experience owners will likely continue to guide the overall strategy and use insights produced from machines to make more systemic and macro level changes to the strategy and design of the human experience. For their part, machines can bring in vast quantities of data, make sense of it, and be able to act upon it in real time, guiding the optimal message to consumers in the right channel at the right time.

My company has a longstanding relationship with an MSP. What does the beyond marketing trend mean for this relationship in the future?

As you explore the trend’s potential for your company, think about where you might need MSPs and agencies to play, as well as what you need to bring in-house in order to create a differentiated experience. A decade ago, companies went through a similar exercise as they tried to determine which, if any, functions could be outsourced to others. Today, you can follow a similar decision-making process: What can MSPs do better than you? What can you do better—and given today’s real-time, always-on demands—more cost-effectively, under your own roof? Do you want to bring all your data in-house or, perhaps, keep data management outsourced, focusing instead on analytics and decisioning? Should you bring only a few channels or adopt only select capabilities? Finally, be realistic about what your organization can support. Can you provide sufficient governance? Do you have the capabilities and support relationships in place to bring new capabilities in-house? These are not decisions to be taken lightly.

Bottom line

In today’s world, the customer is in charge. And in a marketplace of endless options and channels, companies realize that to remain competitive, they will have to create a differentiated human experience and deliver consistently on ever-evolving customer expectations of brand engagement. The beyond marketing trend ushers in a new set of tools and tactics that, deployed strategically, can help companies elevate their marketing operations from art to a blend of art and science, while keeping the customer firmly in the center of all decisions.

Originally published at Deloitte Insights

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