Customer marketing is becoming more fragmented just as it was supposed to get more joined up.

It’s getting harder to connect with our customers. And harder still to build the kind of trust that that lasts a lifetime.

In our headlong pursuit of data driven marketing, we have missed something fundamental about how to connect.

Being human is at the heart of it.

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There are three parts to this presentation.

First, I assess of the problem of connection from the perspective of businesses and their customers.

Second, I challenge how committed businesses are today in putting customers at the heart of their business.

Third, I ask what drives our efforts to connect with customers? And I propose my own manifesto for reconnection.

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Data has been described as the future and saviour of marketing. The lifeblood of every digital platform in the future.

Data can deliver better, faster, fact-based decisions and drive sales at a fraction of the cost of traditional marketing approaches.

Data will not only transform how we sell in the new world. When combined with the right technology platform data can help us to create richer customer experiences.

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CMOs and their teams are often overwhelmed by data and frustrated by what they perceive as a failure to deliver a return.

Ironically our growing need for specialists is part of our problem.

Data scientists, customer experience officers, and technology champions can make existing operating silos worse by bringing in more competing interests.

Many businesses are also ill-equipped to capture and deploy incoming digital data; we have historically pushed messages out.

Many more businesses struggle to match their on and off line data. And most lack the in house expertise to use the data intelligently.

And then there are vexing questions about which technology platforms to purchase.

That all adds up to complexity, which is the enemy of simplicity and connection.

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Meanwhile our customers are finding many of our efforts to deploy smarter data frustrating at best. We fail them:

- When sell triggers and save messages create more attrition because they give unhappy customers an opportunity to reappraise

- When we do not give our front line people access to the data that we are using to drive communication

- When customers hop between one touchpoint and the next and we struggle to keep up and maintain a semblance of conversation

All the while customers are becoming more immune to our push messages; up to 70% of emails are deleted before being opened, and customers can use multiple devices with low levels of attention.

So the majority of so called data driven communications simply floats on the surface of customer experience like oil on water.

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What can we do about this growing failure to connect and execute?

First , there’s what I call “inside out” solutions; how we organise ourselves and use our resources to harness and deploy data.

Second are “outside in” solutions; how we connect with customers in ways that reflect their changing needs.

Today’s session is all about looking “outside in” though the lens of our connected customers.

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A conversion about reconnection has to start with our own intention and purpose.

Why do we want to connect?

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Customer – An asset. The force that shapes our future. Success defined by lifetime value and advocacy.

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An opportunity. Extract and grow value today. Optimise cost to serve.

Does your business see customers first and foremost as an asset?

Or are customers simply an opportunity?

We might talk about customer strategy like this (LH). But rather when chips are down we behave like this (RH).

If we want to reconnect with customers we have to take a longer view and make a deeper commitment to customers than most of us are prepared to entertain right now.

Here’s why.

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Data will fuel a new era in accountable marketing.

But trust will become the gold standard by which relationships are measured in the future.

In the US, trust is cited as being 200% more important than service in determining customer retention in the banking sector* .

In every sector we are having to pay more attention to the impact that trust has on our bottom line.

Why is that?

*source: Forrester:

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An exponential increase in transparency may be the biggest single reason behind the growing importance of trustworthiness.

A recent Bain and Co report demonstrates this:

“People who engage with brands via social media demonstrate a deeper emotional commitment to those brands, and they spend between 20% and 40% more than other customers on the products and services offered by the brands.”

That is great news for marketers and agencies wanting to show that social media can pay its way as a marketing discipline.

But the price we pay is that we now have to play by the same rules that govern relationships between friends and customers.

That is the sting in the tail of the social and technological revolution.

There will be nowhere to hide.

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Gary Vaynerchuck nails it for me when he says:.

“For many years we have wanted to “recreate” relationships at the level of small town grocer and his customers. Relationships enabled by that near perfect exchange of information that only happens when a business owner and their customer really know each other’s needs and intentions.”

The dream has come true. A new level of data driven intelligence brings us as close to understanding customer intentions as the grocery store owner did in the past.

But this is a world where small talk amongst our customers is magnified and it can have big consequences.

Our customers can see us (our intentions and behaviours) as clearly as we can see theirs. And they share.

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That shift has a profound impact on how we shape our customer strategies in the future.

Take customer intimacy as an example.

For some time now we have turned to the language of personal relationships (customer intimacy, social marketing) to describe the impact of data driven insight and application.

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David Maister’s seminal work about building trust in professional service companies, “The Trusted Advisor”, gives us nine tested principles that work.

They are all about how we behave as individuals in business; our underlying intention and purpose.

If we want to win on customer intimacy as a marketing strategy then our intention and behaviour matters more than our ability to harnesses data and be relevant.

It is about having our customers best interests at heart. And it’s a long term game not a race for short term return.

Hamish Rumbold at Air NZ says it well when he reflects that:

“Your customer’s for life, not just your next bonus.”

That is what being human means for customer strategy.

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Jeff Bezos is the founder and CEO of Amazon. Underlying his ruthless, “Be cheap, be fast”, mission to dominate lies a concrete and persuasive long term commitment to customers.

His customer principles are a recipe for any organisation who wants to know how to make a business of putting customers first.

And if you’re looking for proof of the value of committing to customers for the long haul then look at Amazon.

- In 2013, they ranked first in delivering the best customer experience

- Named the world’s most trusted company

Amazon continue to write the rulebook when it comes to harnessing and deploying data.

What Amazon teaches us is that the data fuelled dreams can be fully realised when we put data at the service of our customers’ desires.

From the early days, Jeff and his team defined the value that data would give their customers. And they consistently link data back to customer experience.

Do you have vision for how data will help your organisation?

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We may not be as empowered as Jeff Bezos to shift the dial when it comes to organisational commitment to our customers.

But we can change the way we connect for the better.

How we do that is focus of the rest of today’s presentation.

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How do we build trust and create brand affinity?

OR

How can we cross sell, up sell, and retain using programmes of increasingly data relevant communications?

I’d estimate that over 70% of customer marketing activity is still largely campaign driven. Reactive and tied into above the line activity.

As clients and agencies we aspire to do more work that is programme based, building on known behaviour and working towards long term goals. It’s hard to execute but it’s gets lasting results and wins accolades.

But I’d argue that if we want to reconnect we need to go even further and invest much more time asking, “How will we build trust and create brand affinity?”

Smarter, better “push” communications will not be enough for companies who want to lead.

Here’s why.

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There is a myth at the heart of our data driven world and it shows up in the language we use.

We talk about precision, predictability, fact-based decision making and intelligent automation.

This language is clinical, soulless, command-based and deeply misguided.

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Today’s connected customers are more complex and are as non-linear, irrational and emotional as ever. *

But above all they are in control.

Our customers are not sitting ducks in our sights. They have their hands on the trigger, not us.

They are increasingly overwhelmed by our content, and will create their own so that marketing’s “push” comms become less impactful.

This means that relevance, the holy grail of direct marketers, is no guarantee of connection. *

*Source: Meeting the changing needs of connected customers, Forrester June 2013.

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If we are not in control of the conversation, how can we reconnect?

Here are my top ten ideas for reconnecting with your customers.

They won’t help you find the right people or technology to harness and deploy data.

But they may help you to reconnect more strongly with your customers, and will put your plans to use data in new light.

Not every idea here is my own, but they all are grounded in the search for what it takes to be human in this data driven world.

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This cracking quote appeared on the HBR blog, under the title, “Little data makes big data more powerful” in which Mark Boncheck argues that today’s precision targeting must be balanced with personal value.

It reminds me of the famous Dale Carnegie quote from, “How to win friends and influence people”:

“You will make more friends in two months by becoming interested in other people than you can in two years by trying to get other people interested in you.”

Same idea with a modern context. Data enabled, but grounded in a human truth.

In NZ we are experiencing this kind of use of personal data in action for ourselves.

Air NZ’s MPass

Mercury GEM

Countdown’s shopper app.

All have shifted control to me but have also stimulated a wave of personally relevant and live data about me back into their respective businesses.

Control shifts to the customer, but not necessarily power and influence.

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At some point in the next five years I think the only time your customers will be open to push messages is in the short window before, during and after those moments when they initiate a dialogue with your brand..

It becomes fundamental that marketers understand (if not own) their customer journeys in all their cross-channel and cross-functional messiness.

It’s in those times of customer-initiated connection that you will find the best (and perhaps only) opportunities to connect, and to add value and sell.

You don’t need to have a Masters degree in CE mapping to do that. But you do need to spend time on the front line, sitting over the shoulders of your UX guys listening in to customers.

Question: How well do you understand how your customers interact with you in real life?

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And I mean everything.

Karen Ganshaw, Head of Relationship Marketing & Digital at Westpac Australia, reports that the level of inbound customer interactions at Westpac has increased from 4 million to 100 million interactions per month in the last five years. That is a seismic shift.

Look around and you will discover there is a tidal wave of inbound customer initiated interaction coming your way, most of it through digital channels. Much of it mobile.

No matter how smart we are at using data, if we just push out sales and save messages we are missing the point.

Peter Hessen claims that “the response is the new message*”. There is truth in that.

How we manage the ensuing dialogue and the way we make everything connect is what makes the difference.

But we are ill equipped to manage the response.

In NZ we are in a near crisis state when it comes to tracking and managing responses across channels in ways that exceed expectations and which extract useful data.

Question: What emphasis are you placing on how you manage responses, and how you capture and use the data that is streaming in from inbound interactions? How do you benchmark and monitor this?

* The New Normal, Peter Hesson, 2010

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Nothing epitomises this right now as well as Telecom’s Tech in A Sec (TIAS).

Telecom is not selling anything. They are adding a lot of value for free. That is generating trust and confidence in their brand.

TIAS also generates great content for customer eDMs. And those eDMs have incredibility high engagement rates.

It’s telling that across the ditch Karen and her team at Westpac talk about how they use data insights to help retail staff “whisper into the ear” of customers with great effect. I love that.

Marketing as service in its many dimensions is growing in NZ.

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Research tells us that saying thank you to our customers is good for everyone. So why have we stopped doing it?

I was asked recently why a customer would expect or value a birthday card from their bank or their insurance company?

It works for Wells Fargo who sends out birthday messages to customers who log into internet banking on their birthday. It humanises an otherwise remote interaction and the feedback is consistently strong.

It works for Sprit, who invites all of their staff to write 20 thank you messages to customers every Thursday.

Question: Who do you say thank you to and when? Where are the opportunities for you to express more gratitude toward your customers for their business?

*HBR – Jan/Feb 2012: The Happiness Issue

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Here Gary is answering two questions about how to build loyalty and trust.

He makes the connection between saying thank you and helping not selling.

Gary talks, blogs and tweets relentlessly about the value there is to be had in checking in and saying thank you day to day with your customers.

This has not often been the domain of marketing.. I think it needs to be.

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It’s not just vinyl that made a comeback in 2013. Mail is again proving itself. Because it works.

One of the great things about mail is that it allows you to make relevant personalisation impactful.

Another great thing about mail is that people have forgotten how to make it really work. There is an art to bringing the personal to life in the mailbox.

One of my favourite examples is New World’s Wine Awards. At its heart is an offer of wine personalised to customers based on their behaviour. The choice of wine was printed digitally and wrapped around an image of the wine that was waiting for them, also personalised from the local store owner with their name.

Mail’s re-emergence is part of a resurgence in the physical that I am excited about.

Question: Where might you bring your data to life by deploying physical mail?

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Your frontline staff are your ears and fingertips when it comes to customer connection.

Your frontline staff are so often the point of connection between the data we hold and the experience the customers have.

Yet often we bypass our frontline staff and go direct to customers then wonder why conversations fail when those customers pick up the phone or drop into a store.

At Westpac, Karen and her team started to deploy their newly acquired data through “warm bodies” in retail branches and on the telephone. This has helped bring the marketing and the retail network together in closely working partnership based on helping and selling.

Telecom has equipped its door knockers with intelligence to guide them not only to the right doors but also to tell them what messages they should use in conversation.

Hapoloin, an Israeli bank, succeeded in creating a human (not just personal) experience for high value customers who didn’t come into branch with its “Poalin Connect” service. It gave them responsive online tools to manage their investments, compare their money management with peers and access their dedicated personal manager with a single click. Hapoloin personal mangers could track customer behaviour in real time and they were alerted to significant interactions and behaviours. And intervene.

Forrester say Hapoloin had achieved this for just $10 million and in under 18 months. It may sound like a lot, but consider the return..

Question: How much are you prepared to invest to ensure that data is given to the people your customers turn to for advice, help and personal recognition?

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When our new neighbours arrived in Devonport this spring we didn’t wait to see if they exhibited appropriate neighbourly behaviours before dropping off a bottle of wine.

Yet when customers start a new relationship with us, after an initial flurry of welcome and congrats messages, we sit back and wait for our customers to prove their value to us. To earn our loyalty recognition and reward.

Why?

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David McCallen, our Planning Director, joined RAPP off the back of some great work for T-Mobile last year.

Faced with churn peaking at six months, T-Mobile created a customer rewards programme that delivered at one, three, five and six months.

And they gave rewards to customers who would have exhibited profitable behaviours without being rewarded, which we’d usually call wasting money.

But the retention results and the bottom line impact trumped that cost.

Potential value (not earned value) was the real insight behind this work. They did not wait to reward customers. They took a calculated risk.

Says David, “It proved to me the value of being trustworthy”.

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Air NZ did just that to me to great effect this year.

If you are a Gold Air Points customer you would have received an online survey earlier this year about Air Points.

It took over 20 minutes to complete the survey. For me, it was a bridge too far and I gave up.

But four weeks after the survey closed, an email about Air Points stopped me in my tracks. It told me what changes had been made following that feedback.

I am sure it was not an easy task to make those changes in such short time. But I also bet it paid off in earned respect, trust and commitment.

There is so much insight to be derived from data that we automatically capture through online interactions and monitored behaviours.

But there also is huge power to be had in taking data that has been explicitly asked for, playing it back and using it to make a difference.

Customers love to be asked. Better still they loved to be heard. Above all they want us to take action.

Question: Are you building in explicit questions and responses into your dialogue with customers and your data strategy?

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The previous nine points will only have an impact if their efficacy can be proved or disproved.

By and large our ability to measure is average at best.

Our team at RAPP in London proved that the effort is worth it in partnership with Virgin Airlines – case study available on request from robert.limb@rapp.co.nz

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This is the human truth underneath all of this.

Applying it to our customer marketing is not easy. Harder still is using it to capture and deploy the vast flows of data streaming into our businesses.

But it can and will make a difference to your ability to create lasting brand affinity and trust.

And it will help you to connect your data insights to human behaviours.

SingTel

A friend of mine runs an organisation called Volunteer Auckland.

Volunteer Auckland advertises volunteering roles online for people who want to make difference and volunteer.

After years of bemoaning a lack of interest in volunteering amongst the young, there has been a sea change in behaviour; a 250% + increase in 18 - 24 year olds applying online for volunteer opportunities.

Why the turnaround?

Says Cheryll, “They are conducting so many conversations online but they are searching for something real amidst the chatter”. True or not it is food for thought for anyone targeting 18 – 24 year olds right now.

Cheryll and her team are making a difference through a blended online and personal recruiting experience. It’s not perfect but it gets better every month.

Last year SingTel and my colleagues at Tribal DDB got together to harness that self same desire to make a difference. And to connect. Harnessing data and technology and an understanding of what really matters.

I’ll let the video stand as proof of what can happen when we connect human understanding to the possibilities that data and technology offer us.

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Whats you’re strategy?

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