Thursday, March 30, 2017

Yet Another Wake-Up Call: Marketing, Growth, and Customer Experience

Source: Unsplash, Daria Nepriakhina
My peer, Jake Sorofman, recently wrote a smart blog post about the latest wake-up call for CMOs. It seems chief marketing officers have needed a lot of these arousing calls in recent decades--digital was said to be a wake-up call, and so was the recession, sustainability, and social media. If you're weary of the constant wake-up calls, I wish to offer a solution: Put your focus where it belongs--on the customer--and you will never again have to fear a rude awakening.

The latest career-threatening forewarning was the announcement by Coke that it would no longer have a global CMO (hot on the heels of Unilever and Vodaphone axing their global CMO roles). In place of the CMO, the leader of Coca-Cola's marketing department will report alongside customer and commercial leadership strategy into a new position--the chief growth officer.

MarketingWeek notes Coke is not an outlier--brands such as "Colgate-Palmolive, Coty, Mondel─ôz or Tyson Foods have vocally installed chief growth officers to 'accelerate growth efforts' or to 'bring focus and growth to our platforms.'" Add to this that CMO tenure is again downtrending for the first time in a decade and CMO tenure is the shortest of any in the C-suite, and you have to wonder how anyone in marketing gets any sleep with all these wake-up calls demanding attention.

The question I have to ask is if this is really an issue of labels and titles. Does changing the letter between the "C" and the "O" from "M" to "G" address the problems brands are facing? Is it news to marketers that they were held responsible for growth? As Jake ends his blog post, "Call it whatever you’d like. To me, it’s just a CMO by another name."

Aside from the focus on titles and labels, there is a reason to worry about this fixation on growth: Because it is not a lever the company has to pull. No one can push the "growth" button. Growth is a dependent variable. A brand doesn't create growth--it creates changes that can lead to growth. As such, this obsession with "growth" in the C-suite could, I fear, lead brands further down the path of obsessing about short-term outcomes rather than long-term brand health.

Moreover, growth is not the job of one part of an organization. Naming a chief growth officer makes about as much sense as calling someone the chief profit officer. Both growth and profitability are not the accountability of one person or one part of the organization but is the outcome of collaborative efforts across the enterprise; in fact, I'd suggest companies already have a chief growth officer--the CEO. If the CEO isn't responsible for producing growth of the top and bottom lines, exactly what is he or she doing?

Wednesday, March 22, 2017

Customer Experience, Innovation and the Slow Death of Famed Brands

Source: JMV on Flickr;
https://www.flickr.com/photos/jmv/8069763934
This week, Sears reported that it has "substantial doubt" about its ability to stay in business unless it can borrow more and tap cash from more of its assets. The retailer has been a bricks-and-mortar cautionary tale for so many years, you can be excused if you thought this was old news. In fact, the brand's woes have been so substantial for so long, it can be easy to forget what a powerhouse Sears once was--it helped to create the suburban shopping mall boom in the 1950s, and 60 years later, the retailer is at risk of driving a stake into the heart of those same malls.

Now is perhaps a good time to look back and consider how Sears' struggles are similar to those of other famed brands that failed, such as Borders, Kodak and Circuit City. We can also look at those competitive brands that have, if not flourished, at least survived, such as Barnes & Noble, Fujifilm, and Best Buy.

Simply put, many brands have been and continue to be too confident in their existing brand strength and business models. This confidence causes them to focus on short-term measures rather than leading indicators of success; it encourages them to believe their past history of significant customer loyalty means they do not need to rapidly evolve their customer experience for new customer expectations; and it obscures the necessity to embrace risk and innovate for tomorrow's customer needs. This is why 50% of the Fortune 500 from 1999 has disappeared from the list and why some forecast that 40% of today's Fortune 500 companies will no longer exist in 10 years.

The discipline of customer experience (CX), when done properly, solves these problems. It forces leaders to commit to leading indicators of success, such as customer satisfaction, loyalty and brand advocacy, and not just quarterly financial results. CX also demands that brands continually relearn customers' evolving needs and resolve problems to deliver on those needs across the entire customer journey. And lastly, customer experience is an effective driver of innovation, helping to identify and prioritize those technologies that will satisfy expectations tomorrow. Looking at three companies that failed and three competitors that remain in business illustrates the power of CX.

To read more on how customer experience helped Barnes & Noble, Fujifilm and Best Buy while undermining Borders, Kodak and Circuit City, please continue reading this post on my free Gartner blog.