The Rise of the Platform Marketer: Connected CRM in a Digital World
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Transcript of The Rise of the Platform Marketer: Connected CRM in a Digital World
© 2014 Merkle. All Rights Reserved. Confidential
The Rise of the Platform Marketer: Connected CRM in a Digital World
2014 Chief Marketing Officer Leadership Forum
© 2014 Merkle. All Rights Reserved. Confidential
The marketing landscape is changing
© 2014 Merkle. All Rights Reserved. Confidential
Marketers can again create long-term sustainable advantage by focusing on the customer
1950s+Age of brand
1995+Age of channel
2013+Age of the customer
Direct-to-consumer business model transformation
Addressability At ScaleCreation of national brands
National media and mass marketing
Internet and eCommerce
Social networks & digital media
Contenders we see
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© 2014 Merkle. All Rights Reserved. Confidential
Migration of the consumer from offline to online has hit an inflection point and is disrupting the entire consumer experience
2008
7.0——
6.5 —
6.0——
5.5 —
5.0——
4.5 —
4.0——
3.5 —
3.0——
2.5 —
2.0——
1.5 —
1.0 ——
0.5 —
2008-2013Social media 0.1 to 1.1
Digital content 1.7 to 2.4
Consumer hours spent per day on non-digital channels are decreasing,
while use of digital channels are steadily increasing
Hours
2008-2013TV 3.8 to 3.1Radio1.6 to 1.4Print 0.7 to 0.4
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
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© 2014 Merkle. All Rights Reserved. Confidential
Customer strategy is fundamentally built on a consumer experience
Media Targeting
Channel Personalization
Omni-channel Integration
Distribution
Product
Service
Ope
ratin
g M
odel
Cha
nge
Min
imal
Sign
ifica
ntTr
ansf
orm
ativ
eCom
petitive Advantage
AverageAbove Average
Market Disrupting
Utilization of data and analytics to drive efficiencies in targeting addressable media at the segment or individual level
Utilization of data/analytics to personalize the media and channel experience for the consumer at the segment or individual level
Delivery of not only targeted/personalized experiences at individual points in time but across a longitudinal, cross channel experience
Introduction of new and innovative methods of distribution products/services either direct to consumers or through new forms of intermediaries
Introduction of new/innovative products/services, features, or pricing that fundamentally change the consumer experience
Introduction of new/innovative methods to deliver the product experience and service to customers through new technologies or channels
Utilization of data and analytics to drive efficiencies in targeting addressable media at the segment or individual level
Utilization of data/analytics to personalize the media and channel experience for the consumer at the segment or individual level
Delivery of not only targeted/personalized experiences at individual points in time but across a longitudinal, cross channel experience
Introduction of new and innovative methods of distribution products/services either direct to consumers or through new forms of intermediaries
Introduction of new/innovative products/services, features, or pricing that fundamentally change the consumer experience
Introduction of new/innovative methods to deliver the product experience and service to customers through new technologies or channels
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© 2014 Merkle. All Rights Reserved. Confidential
Addressability at scale is changing how we can engage consumers
© 2014 Merkle. All Rights Reserved. Confidential
The emerging opportunity in Addressability At Scale (AAS) is the key driver of competitive advantage in the age of the customer
Addressability at scale (AAS) is defined as the opportunity to create competitive advantage through the ability to deliver targeted, personalized experiences to consumers.
AAS 5.0Person ID
AAS 1.0Name & Address
AAS 2.0Phone #
AAS 3.0Email Address
AAS 4.0Cookie & Device ID
1990 2014
The merchant opportunity lies in addressability and the enablement of data and analytics
The digital audience platform marketplace that is now at massive scale
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© 2014 Merkle. All Rights Reserved. Confidential
Amidst all of this scale and automation, the addressability of channels and media is increasing every day
The Addressability Spectrum
Anonymous Partially Identified Identified
Unknown Some Knowledge Well KnownKnowledge:
Identification:
Addressability uses customer data (anonymous or identified) to increase the targetability and relevance of marketing impressions and experiences
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© 2014 Merkle. All Rights Reserved. Confidential
1st party data will be a key differentiator
© 2014 Merkle. All Rights Reserved. Confidential
The core enabler of addressable marketing is the connected customer view
• Consolidated view of the consumer across all touchpoints
• Allows clients to analyze their programs in context of the whole picture
• Valuable insights on consumer value, attitudes, and behaviors
• Attribution – provides foundation for effective measurement
• Multi-media, multi-channel optimization based on facts
Social
Direct Mail
Display
Search TV/Video
Mobile
Site
Product
LTV Segment
Demographics
Life Events
Call center
Meetings
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© 2014 Merkle. All Rights Reserved. Confidential
Addressable Platforms
The marketing database is a critical asset in driving relevant and personalized experience
An Audience Platform is a digital technology that enables automated, targeted, personalized experiences to individuals (known and anonymous)
at scale utilizing first and/or third party data
Customers
1st Party Data
3rd
Party Data
CRM Database
© 2014 Merkle. All Rights Reserved. Confidential
Competitive advantage will live in the addressable consumer experience
© 2014 Merkle. All Rights Reserved. Confidential
The addressability battle will be fought in the Mid Funnel
Awareness
Consideration
Engagement
Conversion
Commerce
Experience
Unqualified leads & waste
Upper Funnel
Mid Funnel
Lower Funnel
Media Focused
Channel Focused
CRM Focused
Unknown
High-value customer
Low-value customer
Unknown
High-value customer
Low-value customer
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© 2014 Merkle. All Rights Reserved. Confidential
Customer Remarketing
Audience 1 Audience 2 Audience 3
Addressability is fundamentally changing the role of how 1st party data is used in media targeting.
And effecting the ability to create a personalized and optimized channel experience.
Awareness
Consideration
Engagement
Conversion
Commerce
Experience
With that in mind we need to rethink the boundaries of the Mid Funnel
Expanding the mid level opportunityCRM
Channel
Optimization
Unknown
High-value customer
Low-value customer
Unknown
High-value customer
Low-value customer
Performance Media
Brand Media
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© 2014 Merkle. All Rights Reserved. Confidential
Business Impact
Available Addressable Impressions+400%Addressable Media Spend:+300%Cost Per Lead:-30-40%Targetable Re-Marketing Pool+500%
Cost-Per-Conversion:-40%Average LTV per Customer:+60%
% Personalized Interactions+300%
Taking advantage of addressability is about “widening the pipe” and driving greater scale and efficiency
Unknown
High-value customer
Low-value customer
Unknown
High-value customer
Low-value customer
The funnel is widening and elongating
Customer Remarketing
Audience 1 Audience 2 Audience 3
CRM
Channel
Optimization
Performance Media
Brand Media
CRM
Channel
Optimization
Performance Media
Brand Media
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© 2014 Merkle. All Rights Reserved. Confidential
But creating these experiences will not be easy
© 2014 Merkle. All Rights Reserved. Confidential
The Addressable Experience requires the 3C’s
CONTEXT
Our applied knowledge of the consumer
Every asset we have to put in front of the consumer
CONTENTCONNECTIVITY
When we bringthe two together
in media and channels
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© 2014 Merkle. All Rights Reserved. Confidential
Allowing us to deliver Addressable Customer Experiences
Timing / frequency Platform
Device / format
Segment
A
Segment
C
Segment
D
Segment Lifecycle
Awareness
Product Consideration
Request a Quote
Start Application
Process
CONTEXT
Message Offer
CONTENT
Treatment
Segment
BBrand
Consideration
Segment
BBrand
Consideration
4X
Mobile A
1
Life
CONNECTIVITY
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© 2014 Merkle. All Rights Reserved. Confidential
A new operating model and competencies will be required
© 2014 Merkle. All Rights Reserved. Confidential
Connected CRM is the framework through which we aid our clients in the organizational transformation required to exploit Addressability
The Connected CRM Framework (CCF)Enterprise segmentation, which includes value and lifecycle
dimensions, forms the foundation of CCF
Experience Delivery
Financial Management
Customer Strategy
Financial management informs customer strategy and experience delivery decisions as a closed loop process
These strategies are then translated into actionable media and channel plans that result in highly personalized, targeted experiences
Portfolio Strategy
Segment Strategy Program Strategy
Experience delivery performance is continuously attributed across media and channels which, in turn, drives optimized budget allocation
Media Planning Channel PlanningTargeting & Personalization
Measurement & Attribution
Budget Allocation Infra
stru
ctur
e &
Bus
ines
s Pro
cess Leadership &
Organization
What data, processes, systems, tools and
technology will be
necessary?
What outcomes
are we trying to
create and how do we organize to
enable them?
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© 2014 Merkle. All Rights Reserved. Confidential
The Platform Marketer™ embodies the collective competencies needed to successfully exploit addressability at scale
Marketers must evaluate their own competency level and decide how best to fill gaps internally and with external expertise
In the highly digitized world of AAS, a new set of competencies must be attained by the marketer
We call the personification of those collective skills The Platform Marketer
While new processes, data, and technologies must be implemented (what we call Connected CRM), these digital platform competencies must first be addressed
j
Identity Management
Audience Management
Consumer Privacy &
Compliance
Media Optimization
Platforms Utilization
Channel Optimization
Experience Design &Creation
Measurement and attribution
Marketing Technology
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© 2014 Merkle. All Rights Reserved. Confidential
A new set of technology assets will be required
© 2014 Merkle. All Rights Reserved. Confidential
The landscape has gotten very complex
Platform marketers has strong expertise in state of the art and emerging marketing technology and how it drives business value
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© 2014 Merkle. All Rights Reserved. Confidential
Therefore, we must rationalize the tech stack to support an addressable customer experience
Audience Platforms
Wor
kflo
w
Channel ExecutionMedia Execution
Marketing Database
Identity Management
Application Integration
DSP SearchAd Serving Site SFA/Contact Center
Business Rules Engine
Personalization Engine
Decisioning Algorithms
Audience Management
Real-Time Data Transfer
Syndication
Connected Attribution
Forecasting/Simulation
Business Intelligence
Onboarding CDI/DDI Event Management
Customer 360° Preference Center Event StreamCam
paig
n M
anag
emen
tC
onte
nt M
anag
emen
tM
RM Messaging Mobile
Web Services APIs Tag Management
Analytic Management Platform
Data Management Platform
Decision Management Platform
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© 2014 Merkle. All Rights Reserved. Confidential
Organizing around the customer can be difficult
© 2014 Merkle. All Rights Reserved. Confidential
Evolving the capability and operating model together as a key driver of success
Operating Model
Infrastructure focus, basic capabilities
Single campaign, simple data, little offer and
customer customization
Basic multi-channel, model integration, and campaign
automation
Contact Optimization, multi-touch campaigns, integrated
measurement platform
Customer Value Optimizationfully integrated programs &
campaigns
Cap
abili
ty M
atur
ity
Ideal investment zone [Key decision maker]
Level 1
Level 3
Level 4
Level 5
Level 2
Over-invested (poor return on capital)
Under-invested (poor return on management bandwidth)
Bottom-up path builds infrastructure and seeks to leverage incremental gains to expand effort and drive organizational change
(requires permission)
Top-down path compels Organizational change and
rapidlyenables infrastructure for
efficiency and effectiveness(requires sponsorship)
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© 2014 Merkle. All Rights Reserved. Confidential
But generally a phased approach will create the best outcome
• Streamlined campaigns
• Recommender system enables 1-to-1
• Name/address hygiene
• All addressable media
• Web data integration
• Two way interaction
• Real-time integration
• Real-time Two way interaction
• Store & POS integration
• Call center integration
• Media & Marketing Mix
• Segmentation alignment
• Addressable TV
Offline Channel
Integration
Digital Channels
IntegrationMass MediaIntegrationDigital
MediaIntegrationEmail and
DM
Phase1
Phase2
Phase3
Phase4
Phase5
FullyIntegratedExperience
Connected CRM
Platform
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© 2014 Merkle. All Rights Reserved. Confidential
And the benefits can be rewarding
© 2014 Merkle. All Rights Reserved. Confidential
For most organizations, the impact of effective cCRM can be quite rewarding to both margin and growth
$39MM $104MM $201MM $452MMNPV of Revenue Impact
Year 1 Year 2 Year 3 Years 4+
Acquisition of new customers
Reduction in churn
Improvement in NPS Scores
over Baseline*
$15MM $43MM $93MM $256MM
$24MM $61MM $109MM $196MM
+5 +25 +10 +5
• Use Connected data to understand/predict/model NPS results across subscriber base and target subscribers for Promoter maintenance or Detractor intervention strategies
• Roughly 1bp (~31k subs) reduction in Voluntary Churn YoY over next 5 years• Combine Customer service, Billing contacts with customer data to improve churn rates
• 1%-3% increase in customer acquisition over 5 years• Increased response/conversion from digital media efficiency by connecting Anonymous
Data to CRM data for better targeting, measurement and segmentation• Increased effectiveness of remarketing and personalization (offer/package) in Search,
Display, Site and Email
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