Tuesday, October 29, 2013

Chick-fil-A, Splice Software and Why CEM Summit 2013 Was Special

When we booked Chick-fil-A’s Michael McCathren as a speaker for CEM Summit2013, we knew it was a good decision for the event. After all, Chick-fil-A is an extremely well-known brand and adding a speaker like Michael, their interactive digital marketing manager, would attract attendees and bring some pizzazz to the lineup.

Fast forward to the morning of Thursday, September 26, when Michael took the stage. Facing a roomful of CEOs, CMOs, technologists and marketers, he started speaking from his heart. Silence fell as listeners put down their coffees and iPads, leaned forward and started soaking up every word.

Michael spoke about seeing customers as people, individuals with unique stories. He challenged us to consider building relationships with customers that are much deeper than transactional coupons or deals, more sophisticated than demo segmentation or CRM categories. He reminded us of what loyalty really means and that every one of us could become advocates for transformational customer engagement within our own organizations.

Don’t take my word for it. Watch Michael’s presentation and see for yourself:
I was reminded of Michael’s presentation yesterday after reading a blog post from PossibleNOW’s valued partner Splice Software, a customer engagement technology provider based in Calgary (more than 850 miles from the nearest Chick-fil-A). Regional Sales Director Jeff Kryzanowski had never heard of the Atlanta-based chicken restaurant chain. In other words, Jeff wasn’t blown away by the brand in the way we had originally hoped when we planned the event. And it didn’t matter – the power of Michael’s words made a huge impact on Jeff and everyone else in attendance.

We’re grateful to Michael and Jeff and everyone else that made CEM Summit 2013 such a success. Presentations like Michael’s will be hard to top in 2014…but we’ll try. Keep checking the site, look for emails from us and mark your calendars for next year’s summit. Because someone there – from a brand you recognize or perhaps one you don’t – will share an idea with the potential to change the way you look at customers forever.  

Eric Tejeda is the Director of Product Marketing for PossibleNOW and CompliancePoint. Eric supports the organization’s growth objectives by productizing and launching innovative new products and services that fill critical needs in the marketplace. 

With 25 years of experience, Eric firmly believes that permission-based marketing and preference management is a mega trend and the path to success for marketers today. 

              Follow me on Twitter: @EricTejeda | Connect on LinkedIn: Eric Tejeda 

Wednesday, October 23, 2013

Pizza Hut: Preference Driven Communications and Pizzas

Today’s blog post is from Ernan Roman, one of the keynote speakers at the recent 2013 Customer Engagement Marketing Summit hosted by PossibleNOW. Ernan is a Marketing Hall of Fame inductee and well-known for his Voice of the Customer research. 

The Challenge: Many companies capture large quantities of customer data. But few use the data to deliver a competitively differentiating customer experience.
Pizza Hut is asking customers to provide their preferences and using that information to deliver preference driven communications and pizzas.
Recently, Pizza Hut shifted to more personalized customer interactions by segmenting its customer base into 6,000+ groups based on characteristics, purchase tendencies, and behavioral indicators. Juliana Lim, Senior Marketing Director for Pizza Hut, says, "We now run targeted campaigns built with intelligence around customers' preferred product categories, typical purchase times and channels of choice”. 
Here’s an overview:
  • Pizza Hut provided customers with a registration process to define their personal communication and pizza preferences and delivery instructions.

  • Customers can order online, via traditional call-in, via a mobile site, and even via an ordering app on an Xbox 360® system.
Online registration allows customers to get exclusive deals, save “fast favs” for quick reorders, and even set pre-orders for up to 7 days ahead.
Compared with Pizza Hut's former bulk promotions, this new preference driven communication process has generated:
  • A 200% jump in average campaign hit rates across customer segments,
  • A 38% improvement in Pizza Hut's customer retention rate,
  • A 9% increase in customer visit/purchase frequency in just seven months,
  • Up to 6% extra sales generated every month since the program started.
Findings from research conducted by our company ERDM, indicate that today’s savvy online shoppers understand that in order to receive more personalized offers and communications, they must provide more detailed personal preference information. If they trust the brand… they are willing to provide preference data in order to receive a significantly improved customer experience.
Additional research findings regarding preference based engagement and why consumers see it as a benefit:
  • They receive fewer communications that are not relevant.
  • Provides the flexibility to change their preferences as their needs or situations change.
  • Increases their awareness of product, offer and ordering options.
  • Allows them to spend less time looking for products.

  • Personalization is perceived as a service. Customers want the ability to set personalization preferences. So, tell your customers that true personalization is available and the benefits they will experience.
  • Customers want to be involved in their experience with your company. Customers want to contribute to, and define their relationship with your company. Make it easy for them to do so.
  • Consumers recognize that in order to receive relevant information, they must share increasing amounts of information regarding personalization and preferences. By providing a way for customers to tell you what they want from your company they will be more likely to open, engage with, and respond to, communications and offers.

About the Author:
Ernan Roman Direct Marketing's Customer Experience strategies achieve consistent double-digit increases in response and revenue for their clients, which include IBM, MassMutual, QVC, Microsoft, and Symantec Corp.

As a leader in providing Voice of Customer research-based guidance, ERDM has conducted over 10,000 hours of interviews with their clients' customers and prospects, to gain an in-depth understanding of their expectations for high-value relationships.

he results achieved by ERDM's VoC-based strategies earned Ernan Roman induction into the Marketing Hall of Fame.

Visit his blog at: http://ernanroman.blogspot.com/

Tuesday, October 15, 2013

The Freakonomics of Preference Management

Two of my favorite books are Freakonomics and SuperFreakonomics. Like millions of other readers, I was astonished by examples of simple economic principles at work in real life. Over and over again, people respond to simple incentives and disincentives, leading to very predictable behavior choices.

When I think about the Freakonomics in the context of my work, the parallels are obvious. The incentives and disincentives of preference management for enterprise organizations are pretty clear. Consumers reward companies that listen and learn (incentive) while consumers and the governing bodies that represent them punish companies that don’t respect privacy (disincentive). Both forces push businesses in the same direction: the adoption of smart, efficient preference management practices.
Consumers reward it (Forrester survey):
  • 78% improved ROI
  • 80% higher retention
  • 80% better campaign results
  • 89% higher customer satisfaction
Privacy requires it:
  • FCC and the TCPA - $11,000 per violation (call, email, text)
  • FTC and the TSR - $16,000 per violation (call, email, text)
Let’s take this a step further and consider preference management implementation. How do natural incentives and disincentives inform that process?
As noted in Freakonomics, consumers are driven by incentives, but not every incentive will drive every consumer to act. It boils down to value vs. convenience. One customer may not want to provide an email address in a profile because they think it will only lead to spam messages. But if an incentive is offered for giving that email, say a discount on a future purchase, there is more value in providing the address.
It’s the same with convenience. A customer may not want to create a profile including credit card data for a one-time purchase like a gift. But for sites where he makes regular purchases, the convenience of stored information is a time-saving benefit. Convenience may also translate to confidence. As customers interact with a company more frequently they tend to become more confident that my transactions are secure and that they honor my communications preferences.
Consumers want to decide how companies communicate with them and want personalized messages. Even in just the last 10 years, consumer behavior has shifted in significant ways. More consumers are buying online, or interacting with companies via social media over interacting in person. A robust and flexible preference center is necessary to manage customer data at a central point. This is the proverbial carrot, ­the reward or incentive to act.
At the same time, privacy regulations and global governments are requiring more stringent adherence to preferences. In the U.S. we have typically followed an opt-out protocol, it has been up to the customer to manage communications. Outside of the U.S. the burden is on the company to obtain permission to contact. The changes for mobile communications in the U.S. are the first step towards increased regulations. And the penalties for non-compliance can be steep, from single-violation fines to the potential for class-action suits. This is the proverbial stick ­ the powerful disincentive to continuing with business as usual.
It doesn’t take an award-winning economist to see how preference management is critical to engagement and risk mitigation. But it’s fun to look at the problem/opportunity through the Freakonomics lens and see it in a new light.

About the Author: 
Rob Tate is the Director of Enterprise Sales at PossibleNOW.

Wednesday, October 9, 2013

The Sales Funnel is Dead

Today’s blog post is from Ernan Roman, one of the keynote speakers at the recent 2013 Customer Engagement Marketing Summit hosted by PossibleNOW. Ernan is a Marketing Hall of Fame inductee and well-known for his Voice of the Customer research. 

A circle of continuous engagement is born.
We all grew up with the sales funnel. You know, the one where the company was in control and pushed the prospect through the sales grinder. Well, it's dead.
The good news is that it's been buried by empowered customers who don't see the sale as a “close”, but as the beginning of deeper value and engagement.
According to voice of the customer research we conducted, ongoing value and engagement post-sale are critical for retaining today's empowered consumers. During the past 12 months we included the following question in many of our research efforts: Which has more impact on retention and repeat purchases: customer satisfaction or customer engagement/relationship?

The answer was consistent across our B2B and B2C research: Engagement/relationship strength has 12 times more influence on retention and repeat purchases than satisfaction. Basic satisfaction is now table stakes. Today's consumers expect that the sale is just the beginning of a journey of increasingly personalized and sustained engagement.
The Traditional Funnel
The traditional sales funnel was created to “drive a sale” to closure. It worked—until customers decided that they were empowered to exert their preferences regarding how, when, and where they wanted to engage pre and post-sale.

Circle of Continuous Engagement
Given the tough economic times, companies recognize that increasing retention and renewal rates is more important than ever. Therefore, ongoing engagement post-sale is critical. This has caused today's sales process to become a circle focused on driving engagement over time. This circle encompasses three key phases of the customer lifecycle:

  • Focus on providing easy, hassle-free, personalized solutions.
  • Learn customers' opt-in messaging and communication preferences.
  • Engage customers across the multichannel mix.

  • Don't “close.” Instead, think of the sale as the beginning of proactive, value-based relationship development.
Growth and Retention
  • Develop a plan for ongoing proactive engagement, i.e. “How can we better serve you?”
  • Provide an ongoing value –add, which justifies a price premium.
  • Be relevant. Communications must be highly personalized, targeted, and delivered or accessed across the multichannel mix.
However, a note of caution: many companies are still not equipped to deliver this level of ongoing and multichannel engagement. In the 2013 benchmarking study by the Retail Systems Research (RSR) Institute, Retailing: Omni-Channel Approach Central to Strategies in 2013, 54% of respondents indicate that they do not have a view of customers across channels.

DHL Solves Problems to Grow

DHL is one company that has cultivated a commitment to being customer focused. It has developed processes that solve problems and create goodwill at every touchpoint—and and at every part of the shipping continuum. For example, it integrated formerly stand-alone business units to provide solutions and to support customers more effectively, and developed specific industry know-how and solution segments that specialize in providing niche service by industry to address specific customer concerns.  By adopting this customer-centric approach, the company increased profit from operating activities in the first half of 2013 by 7.8%.

The Key Takeaways

1. Shift from the obsolete sales funnel to a customer lifecycle view.
Focus on developing ever-deeper relationships with your customers across their ongoing customer experience with your company. 

2. Be actively engaged with prospects during their decision journey.
Provide easy-to-find information, access to reviews, etc., to enable prospects to evaluate your company, product, and services against others they're considering. Opinion influencers—such as product reviews, ratings, and testimonials—are critical. In addition, provide convenient contact resources, such as online chat that answers questions, while prospects are still on your website. This high-level of value and service sets an important tone at the beginning of the customer life cycle.

3. Understand your customer's journey from pre-sale to post-sale.
Understanding the factors that make customers want to purchase from you--and then stay with you after the sale—lets you highlight your company benefits and use these key selling points in your marketing. Put in place the means by which customers can easily access information and help along the way from pre- through post-sale phases.

4. Be easily accessible across channels.
Consumers are shopping via multiple channels and devices often at the same time. Don't create barriers by being unavailable or making it difficult to engage across the channels your customers prefer.

5. Don't forget about customers after you ring the register.
Keep customers actively engaged via preference-driven, personalized communications and experiences. Provide ongoing information to improve their lives, solicit feedback, and stimulate purchases of relevant new and add-on products. Make your customers feel as though they are a part of your company's community through a multichannel relationship-focused continuous cycle of engagement.


About the Author:
Ernan Roman Direct Marketing's Customer Experience strategies achieve consistent double-digit increases in response and revenue for their clients, which include IBM, MassMutual, QVC, Microsoft, and Symantec Corp.

As a leader in providing Voice of Customer research-based guidance, ERDM has conducted over 10,000 hours of interviews with their clients' customers and prospects, to gain an in-depth understanding of their expectations for high-value relationships.

he results achieved by ERDM's VoC-based strategies earned Ernan Roman induction into the Marketing Hall of Fame.

Visit his blog at: http://ernanroman.blogspot.com/

Wednesday, October 2, 2013

Flexibility and Complexity Combine in Building a Preference Center

Building an Enterprise-level preference center from the ground up can be a daunting task for any company. From my perspective, however, there is great excitement and enthusiasm around this type of project. Our industry is new enough that there are still challenges to tackle and best practices to create.

As consumers become more accustomed to using multiple touch points to interact with companies, it becomes more complex for companies to build a preference center that meets all of those needs. Pain points for the company include customer demands, regulatory requirements, technical and infrastructure hurdles or maybe all of these at the same time.  Consumer data may be in many silos and in areas even a blood hound could not find. Combine data overload with ever-changing regulations and the complexity only multiplies.

Start with the basics.
The key is to start with the basic elements of managing preferences as a foundation and avoid painting yourself into a corner and not knowing it until it is too late. Where I see architects (and companies) fail is when they build the most fundamental elements and structure based on their business rules and overly complicate their designs.  Invariably, the weight of the added business elements and rules will bring the project to a screeching halt, after months or work and a lot of money.

At the core, however, you’re dealing with a pretty simple concept: I want this, I don’t want that. Think of it as a physical storage of data, not the logical application of it.

In the “DO NOT” world, it is pretty simple: “Do not call”, “do not mail” or “do not email”.  Preference management turns the tables on the “do not” idea by turning it into a “DO” world of “What I want you to do.” Just because a customer has some ‘do not’ preferences doesn’t mean he is not your customer, he simply prefers you ‘do’ contact him in certain ways.

Consider this “Do Not Call” example.  A customer has asked to be removed from your calling list during your latest marketing campaign and calling blitz.  So, you take the number: (888) 555-1212 and mark it “Opt-out” in your CRM system.  However, your customer still wants your monthly eNewsletter emailed, wants special discounts and promotions texted to them, and their monthly statement mailed.  What does that look like? Let’s see:


Your Customer told you:
Contact Element
Unique Identifier
“I don’t want you to call me”
(800) 555-1212
“I want your eMail Newsletter”
“Send me text messages with special offers”
SMS / Text
(888) 222-1515
“I want my statements mailed to me”
123 Peachtree Street
Atlanta, GA 30305
Also note that records must be audited for compliance, which should be built into the architecture. You can’t make assumptions based on preferences or expand communication with the customer beyond what he has allowed.

This example includes the primary contact points customers are using today: phone, email, SMS/text and mail. While it may seem unnecessary to include all of those options in a basic preference center, smart companies will build a center that can handle multiple preferences, or at least be flexible enough to add those entries over the long-term. Flexibility is key as technology continues to change. We can’t predict if these contact points will still be the norm even five years from now.

Of course, what you capture depends on the nature of your business. For example, telemarketers may only track phone numbers, because that’s the only way they contact customers. Others need a more complex structure that allows multiple communication channels for customers.

The chart also adds an element that can assist from a data storage and compliance standpoint: a unique customer identifier that links back to your CRM. While this is not essential, it can help when managing what may seem to be overwhelming silos of data.

So, my position is that this is the basic element and preference building block that you then build upon. The structure is the single source of truth of preference information in one place that your other systems feed, query, update and report upon. If you do your design correctly, this can scale to handle hundreds of millions and even billions of records under management and be accessible across the enterprise.

About the Author: 
As Solutions Architect at PossibleNOW, Tom Fricano is the senior managing consultant providing strategic oversight and is responsible for defining comprehensive preference management solutions for our customers to enhance their marketing effectiveness.