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Ernan’s Insights on Marketing Best Practices

Monday, August 7, 2017

Companies That Thrive During Tough Times Share These Traits

Article by Ernan Roman
Featured on CMO.com
In the same economy and same consumer market in which thousands of retailers and brands are struggling, others are thriving and growing. Why? What drives the outcome of "something went wrong" versus "things are going great"?
Their "secrets" become apparent by understanding who they are, who they serve, and how they connect with customers in a value-driven, sustainable way. It all starts at the very top.
"CEOs must create a culture where the key measure of success is the success of your customers," said Serge Saxonov, CEO of biotechnology company 10x Genomics. "To achieve that, the company must constantly seek unbiased, unadulterated, and blunt feedback from customers and prospects. That will keep the company from creating its own version of ‘marketplace reality.'"
Employees also factor into the equation. "CEOs must ensure that every employee cares passionately about the success of customers and make decisions based on ensuring that customers succeed," Saxonov told me. "This will drive the sustainable success and growth of the company."
Here's a look at three success traits traits driving success at a trio of top brands.
Success Factor #1: Meet A Clearly Defined Need
According to the Accenture study "Technology Trends 2017" (PDF), relationships are no longer about keeping customers happy as the company guides them toward a goal. Relationships will be about walking with people on a path they define.
In the very competitive fitness sector, Orangetheory Fitness has received the workout world's attention with 600 studios across the country and $450 million in revenue. To differentiate itself from competitors, Orangetheory Fitness aimed to satisfy the needs of high-tech, fitness-oriented consumers with a technology-driven solution that participants monitor to pinpoint the effectiveness of each workout.
"Technology enables the consumer to ... work out better. ... I think the lack of technology made it very hard for people to hit their fitness goals," said CEO David Long.
Findings from 16,000-plus hours of VoC research interviews conducted by our firm, ERDM, make it evident that success depends, in large measure, on understanding what it takes to earn the customer relationship. Consider these representative quotes from the research:
  • "It's not just what we buy from you; it is the total experience that determines whether we buy from you again ... or go to the many other choices in your category."
  • "If you want to keep me as a customer, I expect what you market to me to reflect my individual interests and preferences."
Success Factor #2: Abandon The Ego Of ‘That's How We Do It'
According to John Rand, senior vice president of retail insights for Kantar Retail, "As a response to the many obvious challenges to the traditional business ... seek to differentiate, adopt new practices, and reconsider the brand and shopper focus."
A few years ago, Lego's CEO Jørgen Vig Knudstorp told colleagues, "We are on a burning platform ... [and] likely won't survive." Recently, however, the company announced the highest revenues in its 85-year history. What made the difference? Perhaps Julia Goldin, Lego's chief marketing officer, has the answer: "Every year [we] recruit every child again and make the brand exciting for them."
Two key strategies that keep Lego ahead of the game are:
  • It cut its losses and outsourced ventures that were outside of its core expertise: According to Simon Cotterrell of analytics firm Interbrand, what has made Lego successful comes from knowing what it is good at. "That's a very brave thing to do, and it's where a lot of companies go wrong," he said. "They don't understand that sometimes it's better to let go than to hang on."
  • The company found new ways to listen to its customers: Anne Flemmert Jensen, senior director of Lego's Global Insights group, noted, "My team spends all our time travelling around the world, talking to kids and their families, and participating in their daily lives." The company also rolled out Lego Life, a social network for kids.
Success Factor #3: Don't Just Market--Understand And Communicate
Urban Outfitters has experienced an 146% increase in revenue and 75% gain in conversions through the use of new, personalized marketing opportunities and innovative use of tools, such as very targeted location data.
"Our goal is to provide better experiences for our audience in this competitive landscape," said Andrew Rauch, senior director of global digital marketing at Urban Outfitters. Additionally, Trish Donnelly, CEO of Urban Outfitters Group, commented on the brand's use of social to connect: "This channel has given us yet another relevant way to connect with our customers and engage in two-way conversations."
In summary, a combination of clarity of vision and focus, agility, and strategies that stress connections and relationships that evolve over time with customers is what separates companies that still thrive in a landscape of tough times versus those that don't. This final quote from the VoC research says it all: "The brands that earn my loyalty are those that make the effort to understand me and help me over time. The brands that sell and disappear haven't done anything to earn my loyalty and dollars."

Monday, July 24, 2017

Does Your Brand Experience Align with Customers’ Voices? Elizabeth Arden Shows How

Article by Ernan Roman
Featured on CustomerThink.com
“Our leaders quickly realized that before we could use digital to transform our customers and the world, we needed to transform ourselves.” This according to General Electric Co. CMO, Linda Boff, “Over the last few years the company changed its way of doing business at every level. And, per Boff, “When we apply these technologies in our teams and facilities, our customers and markets can reach their potential.”
“Listening” has been the industry buzz word for years and is key to building relationships for both BtoB and BtoC businesses. And although many companies have put in place extensive systems for “listening” very few are responding to what they are “hearing.”
So, the action companies must take is to share customer listening insights across all departments involved in product development and marketing. They must ensure that the actual brand experience and products align with BtoB and BtoC customer’s voices.
Elizabeth Arden Goes Inside to Get Insights
Going beyond traditional focus groups has been a strategy for beauty company, Elizabeth Arden who looks to their “Arden Insiders,” insight community of more than 4,000 women, to inform the direction of innovation and critical product and design decisions. Utilizing consumer opinions and feedback, the company can make educated decisions to stay aligned with consumer sentiment.
Celia Tombalakian, the senior director of global insights and product development commented on their new customer-insight driven marketing, “…[The] Customer intelligence platform allows us not only to identify our customer’s likes and dislikes…but to stay current on who she is and where she is going from a beauty point of view—typical focus groups or questionnaires just can’t capture this.”
The company uses this insight group to test copy, print ad concepts, promotional offerings, product claims, model photography, and branding and new product ideas. The feedback drives decisions on all aspects of creative and design. Per Tombalakian, “We launched our community as a one-year pilot and within the six months we were discussing plans for geographic expansion. The ROI was very apparent to all stakeholders.”
The company uses real time feedback on initiatives they are working on through their Arden Insiders insight community customer intelligence platform. Noted Tombalakian, “Arden Insiders transformed how we are making many decisions…this is critical because they can weave [the customer] point of view through all stages of product or program development rather than just key junctions.”
The company also implemented a dedicated market research and customer insight department to assure that their customers’ voice is incorporated in all decisions. Tombalakian summed up the investment payoff, “We launched our community as a one-year pilot and within the six months we were discussing …expansion. The ROI was very apparent to all stakeholders.”
Use Insights to Connect
Findings from 15,000+ hours of VoC research interviews indicate that customers want deeper engagement throughout their brand lifecycle. This means that marketers should utilize Voice of Customer (VoC) insights from your customers and prospects to improve their experience during all these key points: acquisition, activation, loyalty—and critically, deepening the relationship.
Here are a few quotes from recent VoC research to consider as you develop your strategies:
“When a supplier proactively works to understand my needs, we can develop a personal connection. That forms the basis of a long-term relationship that will remain when we are approached by their competitors or have the occasional problem with their solution.”
“I appreciate you asking for feedback and clearly listening and taking action based on what we are saying. Very few companies ask for our opinions regarding how they can get better and what I would like to see them do. That’s cool. It means you are trying to get bigger and better.”
It’s not just BtoC companies that are seeing results from customer listening, BtoB brands such as GE have devised campaigns to target niche audiences to gain insights on sentiment. GE’s #CC9900 GEEKS GO campaign connected with coders in a challenge environment on social media that used a game-style conversation to spark interactions.
Make Listening an Everyday Marketing Practice
In a research report by Wharton, Listening to the Online ‘Voice of the Customer’, the following points were cited:
  • Large online customer discussions boards carry the potential to revolutionize the world of market research, offering businesses a massive and free data base of what customers think about their products.
  • Traditional surveys and focus groups are flawed because the process of identifying the specific product attributes in a customer survey [are] typically guided by company marketing managers, [and] often ignore issues being raised by customers. In addition, focus groups might not always reach the most passionate and engaged customers who are voluntarily discussing products and brands on the Internet.
  • [There are] “unseen attributes of a product” – that is, issues that buyers are discussing which executives back at the headquarters are not even aware of.
The takeaway for brands is that actual customer sentiment needs to be a prime focus and that listening (rather than assuming or modeling) must become a regular part of everyday marketing practices.

Monday, July 10, 2017

Head Of Neiman Marcus' iLab Answers 4 Questions For Marketing Innovators

Article by Ernan Roman
Featured on CMO.com
Scott Emmons is focused on innovation for the Neiman Marcus Group (NMG), where he is responsible for evaluating, designing, testing, and piloting cutting-edge technologies and applications for luxury retail. Emmons founded and built the Neiman Marcus Innovation Lab (iLab) in 2012, which has grown to become the company’s hub for innovation projects and has earned a world-class reputation for retail innovation. Recent innovation projects include Memory Makeover, connected fitting room technology, intelligent mobile phone charging stations, and voice-controlled sales associate communicators.
Emmons recently participated in our "4 Questions for Marketing Innovators" series.
1. What is one marketing topic that is most important to you as an innovator?
I would start by saying I am not a marketer. However, after being given the opportunity to help create the Neiman Marcus Innovation Lab, it didn’t take long to figure out that marketing was going to be one of the most important partners when it came time to introduce new technology into the retail customer experience. One of the biggest contributions that the Innovation Lab has made is that it has helped open doors between IT, marketing, and other areas of the business. It has also allowed for a much more collaborative relationship to evolve. The most important topic has been solving problems for the customers. It is a topic that is always top-of-mind throughout the retail organization.
2. Why is this so important?
For one thing, it has allowed me to focus on the fact that we are in the luxury retail business. The most important thing everyone does at Neiman Marcus is contribute to our customer’s experience, making sure it is the best one possible. I am a retailer first and a technologist second. In IT, we have to be great at delivering information services to our business partners, but our customer is first and foremost. It is possible to lose track of that in the day-to-day activities of keeping everything humming along.
“Customer first” is not just a checkmark on a review form; it is what has driven the Neiman Marcus brand for 110 years and is what will take us through the next 100 years. I believe the iLab has played a role in helping us maintain that customer focus in this time of constant change. By making experimentation with new customer-facing technology available and applying it in ways that make the customer experience better, I believe our innovation program has helped the IT organization evolve from order takers to business partners that are part of the ideation and innovation process. That, in turns, means we can better position resources to support initiatives and to be able to say yes a lot more often when asked to support new capabilities. The innovation program is allowing Neiman Marcus to be first to leverage the latest and greatest technology and help drive our reputation as an innovative retail technology leader.
3. How can this improve the customer experience?
This translates into a more agile organization that can build and deliver new capabilities for our customers at a much faster pace. Given the ever-increasing speed that change and new technology is being introduced, it is only natural that the business has had to adapt to meet this challenge. Removing the internal silos allows us to be better and faster at delivering a cohesive and compelling experience to our customers. It allows us to bring the right resources to the never-ending circle of evaluating, experimenting, learning, and refining how we deliver value to our customers. The iLab can quickly deliver technology that enables new surprise-and-delight moments to the customer. This same technology has brought new capabilities for collecting data that delivers new insights for the marketing team.
4. How will this improve the effectiveness of marketing?
Essentially, I have been talking about blurring the lines between the technology team and marketing, as this translates into combining skill sets. Bringing marketers together with technologists and combining people that know how to communicate and resonate with the customer can effectively identify, integrate, and implement cutting-edge technology to support the efforts. It is a powerful combination.
Bonus Question: What is your favorite activity outside of work?
I love to travel abroad with my wife and daughter. It is important to see and experience different cultures and perspectives. This also comes in pretty handy for my innovation work!
For additional Marketing Innovator stories, click here.