Aligning Marketing Strategy and Customer Experience

In this article I offer 3 key domains where CX and marketing converge: customer retention, customer acquisition and increased customer spend.

I often get questions about my focus on both marketing strategy and customer experience. The fact is I started my career in marketing 22 years ago, over half of that time I’ve been privileged to concentrate my attention in the Customer Experience field.

But the truth is, Marketing and CX are intertwined, and increasingly so. No wonder most CX programs are run by marketing departments (86% of CMOs and senior marketing executives believe they will own the end-to-end customer experience by 2020). The Chartered Institute of Marketing (CIM) defines marketing as ‘the management process responsible for identifying, anticipating and satisfying customer requirements profitably’. Among the many definitions I’ve come across – including the 4P’s reminiscent of my business studies – this one is my personal favourite. It also addresses Red Loom’s consultancy focus beautifully. Marketing strategy should focus on customer requirements, and Customer Experience programs need to deliver in line with overall business and marketing objectives.

In this article I offer 3 key domains where CX and marketing converge: customer retention, customer acquisition and increased customer spend. For each one, I propose a focus area where each discipline can “try harder” as well as one business KPI to track (note: not a CX or marketing metric). After all neither discipline nor their associated metrics should be called “soft”, not if you’re doing it right.

A [substantial] caveat here: clearly this is not an exhaustive list, but it’s a good start and few organisations can claim to be excellent at all 3 areas below. Another caveat, key metrics can be substituted to or added instead of the ones proposed below. It’s not really about KPIs, but the way you align and link marketing and CX metrics to overall business outcomes.

1. Retain customers

Key metric: Customer churn rate

Clearly preventing churn is a worthy goal. Yet I’m always surprised how little effort, proportionately, this goal receives compares to other objectives such as customer acquisition. In my perspective, far more should be done to proactively analyse customer behaviour and feedback with the view to better respond - and exceed when possible – your customers’ expectations.

How Marketing can try harder: Make customers feel like they matter. Personalisation has become a buzz word but few do it well. The devil, as always in my view, is in the detail. Easy enough to come up with a personalisation strategy enabled by CRM and marketing automation technology... OK, not that easy! But where organisations often fail lies in the execution. I suggest all marketers take a proper, honest look at their data, and try to understand what their customers want to hear about, not just what they want to say. Recent regulations like GDPR (see my blog) and CCPA might feel overwhelming at times, but they’ve served a key purpose in forcing organisations to take a long, hard look at their “blanket marketing” strategies. Your customers are the lifeblood of your brand, not a commodity.

How CX can try harder: Where I see most Voice of the Customer programmes stagnate, and often fail altogether, is around the ability to go beyond the survey... and to deliver actual results, especially customer retention (other CX economics apply here too, but let’s say focused on the basics). Trying to do too much around customer experience improvements often amounts to nothing, or at least nothing concrete and measurable (see the need to set SMART goals for VoC programmes in this blog)... So they end up with lots of brilliant data that’s completely relevant and interesting, but not actionable. If you set out to decrease churn as a priority, and set up your program to focus on this at the start, you’re much more likely to start strong, deliver results, gain credibility with the Exec... only then you can scale up to the next goal! Of course if you have your CEO’s support, and the resources, for a more ambitious start, go for it! But always focus on business goals, not survey questions or CX metrics, or even your most passionate supporter will lose interest.

2. Attract new customers

Key metric: Net New Sales

Another worthy goal that doesn’t need clarifying. Marketing is clearly focused on this in most organisations - often at the detriment of Goal #1. CX often ignores this as prospects are not customers yet... obviously. Much to be done on both sides then to maximise opportunities for your company.

How Marketing can try harder: in some organisations the focus is on acquiring customers at all costs. Sales and marketing are usually the prime suspects here, although you might say that the order from the top to meet quotas “no matter what” is equally at fault. In the end customer support and account management are often the ones who pick up the tab! More focus on the right customers, with tools like key target profiling and account-based marketing, can really help to ensure you don’t just get new customers, you get long-term partnerships that will yield higher revenues.

How CX can try harder: when done right, CX professionals can contribute towards acquiring new customers. In fact ensuring they activate customer advocacy early on in the set-up of a VoC programme is a great way to show positive results quickly. With ROI being critical to the success of such programmes, if a direct link to new sales can be proven at the start, you’re likely to see more engagement from the top. As you identify promoters or highly-satisfied customers according to whichever metric you have in place, think of engaging and creative ways to activate their word of mouth. An easy way to approve a verbatim as quote, the chance to get their story out via a case study or speaking opportunity, connecting them with peers in their industry... In some cases asking them to refer a friend or colleague in exchange for a reward has also proven to work - just make sure you keep track of all your activities or their result won’t be attributed to CX.

3. Increased customer spend

Key Metric: Customer Lifetime Value

You might say this is closely linked to Goal #1 on the list: retain customers. It would be reasonable to assume the efforts you spend earning your customers’ loyalty should also lead to them spending more with you. Sometimes it is, but it’s worth paying some attention at strategies that focus on upsell and cross-sell opportunities.

How Marketing can try harder: personalisation again comes in handy here but in a different way. The good old ways - where personalisation meant you put the customer’s [FirstName] after “Hi” in email campaigns, or their company name in the Subject Line – are still important of course. But organisations with world-class marketing strategies out there have set new standards, with tactics and technology that enable omnichannel communications to target the right offers to the right customers at the right time through the right channel. For instance, call centre agents can offer the right product to the right customer based on the current conversation, customer profile and purchase history.

How CX can try harder: linking customer insights to customer success strategy can yield maximum benefits here. An area that is rarely leveraged in most organisations I’ve talked to is the ability to understand what the customer is trying to achieve in the short, medium and long term. With this understanding, combined with the customer insights you possess (feedback, behavioural data, etc.), the conversation between your account managers and your customers can be much more personalised and targeted. Instead of flogging products, your employees can relay how they can help clients be successful, and propose the right mix of products and services, with associated customer value and ROI. A win win situation for all!

In this article I’ve tried to keep the focus on top marketing and CX tips for in B2B organisations. Professionals in these disciplines are often swamped by the sheer volume of activities required to satisfy the dozens of metrics they’re measured on. The list I proposed in this article might look basic, but how many organisations out there get the basics right? You shouldn’t scale up until you’ve laid solid foundations for your marketing and customer experience strategy. Otherwise you’re risking staff burnout for the sake of achieving the wrong goals.

I get very passionate about the convergence of CX and Marketing and I hope this article has helped to clarify ways to gain focus in both disciplines. They often get blame (sometimes rightly so) for caring too much about their own metrics, but they are undoubtedly dedicated to the success of their organisation. Laser focus and alignment with business goals are essential in ensuring they don’t justify their day jobs by listing activities – no matter how clever or successful – but by showing their direct contribution to business KPIs.