Marketers make intelligence choice

26 November 2009 | By Joe Fernandez

The future ranks of chief marketing officers will come from the “customer intelligence” division of businesses, claims a new report from Forrester Research called The Intelligent Approach to Customer Intelligence.

After suggesting last month that the brand manager role in organisations should be ditched in favour of an “advocate” position (MW 29 October), the analyst now suggests that the typical path to the chief marketing officer job through junior marketing roles is also under threat. It says those executives within businesses that control the data will become “the next generation of CMOs”.

Forrester says that many brands are failing to pay attention to the importance of customer intelligence even though “eventually, it will drive corporate strategy and create competitive advantage”. The marketers sitting on the boards of companies in a few years’ time will be those who have taken time to understand customer intelligence rather than simply campaign management.

The report suggests that while companies are now collecting customer data in more ways than ever before, recognition of the role that data plays is still at an all-time low.

Dave Frankland, principal analyst at Forrester, explains: “Customer intelligence can really help a company steer itself in the right direction and help embed strong loyalty. However, at the moment there is too much differentiation over how such data is used and so customer intelligence is not yet the strategic weapon it should be.”

Working together
However, the report warns that collating, segmenting and communicating that data requires marketing departments to “have technologists, analytics scientists, practitioners and strategists all working together to identify customer intelligence and use it effectively”.

Google UK managing director Matt Brittin agrees it is crucial that marketers make the most out of the data they collate. “Consumers want to be multichannel and brands have to find ways of adapting to that by taking advantage of the data they collect and communicating with their customers in the way they want,” he says.

“The more close-knit the marketing team is, the better, as that means having people in place to work across all elements of campaigns – from the creative to the data collection, data filtering, analysis and segmentation and, finally, the overall analytics review.”

This change in focus has been visible in recent job ads for the marketing sector, with job titles like marketing data analyst, insight manager and head of CRM regularly appearing in the recruitment sections of magazines and websites.

But Forrester’s Frankland says there is still more work to do. “Some marketers have not fully grasped customer intelligence, which is why it’s not yet the tool we want it to be. Everyone needs to understand the technology involved and take a role in making customer intelligence a core asset to business growth. Every customer should be understood so well that any dialogue you have with him or her keeps them engaged.”

Zurich Financial Services chief marketing and communications officer Arun Zinha agrees: “Customer intelligence is fundamental to making sure that your brand knows what is expected of it. It’s a simple reminder that we are putting consumers first and understand what they want. We revolve around them.”

Digital video recorders let consumers skip ads on TV and social media platforms like Twitter and Facebook allow consumers to have direct “conversations” with brands on a daily basis. This means organisations must now use their data to make sure these relationships are more than simply one-way.

According to a study by The CMO Club and Hill & Knowlton, 84% of CMOs allocate less than 10% of their budgets to social media and non-traditional communications channels, while 55% of CMOs allocate 5% of their budget or less to new channels of communication.

Forrester’s Frankland explains: “It’s about building the perfect view of your customers and then interacting with them accordingly. Central to this is a reliable data warehouse that provides you with fast and accurate information about what people want and when, so that everything you serve them with is something they want and will treasure accordingly.”

The company’s report claims companies often focus their data drives on campaign analytics and forget about effective customer interaction such as personalised communications. Indeed, just 13% of consumers see ads relevant to their wants and needs, according to Forrester figures.

Toshiba UK marketing director Matt McDowell says: “Customer intelligence is at the heart of everything we do because we know that it’s our customer demands that will help keep our innovation strong.

“We always encourage them to tell us what they want from the start and we build on that consumer feedback in our future designs. We’d be lost without that customer intelligence but it has taken us years to get it right. I’m sure others will follow suit in the near future.”

Forrester says customer intelligence must now be used as “a tool to drive overall business growth” rather than just being “seen as a marketing tool”. 

Paul Frampton, managing director of agency Media Planning Group, says he has seen data transcending the marketing departments of its clients. “Once properly analysed, its richness is so core that it’s not just marketers who want access to it – everyone wants to understand what it’s worth and how it will fit in with profit and loss estimates,” he says.

“The old days of spreadsheets have matured to ‘dashboards’ that go down to granular level, so I can see why future CMOs could come from this background.”

Google’s Brittin agrees: “The innovation in customer intelligence has broken down the walls between internal communications and collaborations.” But Forrester warns that brands must make sure there are no gaps between insight and execution. Marketing departments should not feel like they are drowning in data; instead, they should feel like the data is helping them to organise the company around the customer.

David Beard, pre-sales manager for Sage Enterprise Business, says: “Better intelligence about what customers want is certainly going to put a business in a more advantageous position when it comes to tailoring offerings to meet customer demand and navigating an increasingly competitive landscape. Simply crunching numbers without any context from which the data may be drawn is a dangerous road to take.”

 

Career advancement
In the end, it will be the board the marketer has to report to and prove that the funds allocated to customer intelligence were worth it. Forrester’s Frankland says that without an in-depth knowledge of customer intelligence, marketers will not be able to advance their careers. This is why those in charge of the data will rise to the top of the organisation.

He cautions: “Customer intelligence is a discipline in the making and marketers have to acknowledge this. The future of marketing will lie in the people who can collect the data, scrutinise it and use it for their own commercial gain. Any marketers looking to hold onto the old school beliefs will not become a CMO. Only those who access the data correctly and leverage it well will be looked on favourably by the boards in the future.”