April 18 2018
Part 3: Customer Obsession Relies on Marketing
If it feels like you’re a little behind or perhaps struggling to keep up with ever-increasing customer demands, you‘re not alone. It could be that the 20-year business cycle in which the most successful enterprises are reinventing themselves to understand and serve increasingly powerful customers is already 30% behind us. That's right, this cycle Forrester deemed the age of the customer started in 2010 and has been going strong for over six years now—and it’s really beginning to pick up speed.
Source: Forrester Research, Inc.
So, it‘s only natural that getting on board at this point is going to feel a bit like train hopping.
But, we have good news. In this week’s blog, we’re going to talk about how the evolution of customer-obsessed marketing can really improve an organization’s ability to hop this fast-moving train.
First, let's recap the top three findings from our research with Forrester:*
- Marketing-led companies are more likely to outperform others on key metrics.
- Customer obsession requires a reliance on marketing.
- Empowered customers make customer obsession essential.
So, how and why does customer obsession rely so much on marketing? First, let's think about what it means—quantifiably—to be “customer-focused.” For our study with Forrester, we defined it as companies that strive to improve their customer experiences and build their business strategies around customer insights. To say it in simpler terms, borrowing from Alex Allwood’s book, “Customer experience is the brand.”
Even though less than half (43%) of our respondents matched this mindset, we wanted to know what that set of front-runners and forward-thinkers were doing that made them so customer-obsessed and ahead of the curve.
Here’s what we learned:
- Customer-obsessed companies are more attuned to the disruptive changes empowered customers create.
Not only do these companies see business change as essential, but they also understand that marketing must play a key role in the transformation of the business. Seventy percent felt that marketing must do things it has never done before. This 70% also was more likely to (a) feel more pressure to transform the business than their counterparts in non-obsessed companies; (b) be doing things today that would not have been marketing's responsibility three to four years ago; and (c) power shifting to customers and prospects. In all three areas, the 25% gap between customer-obsessed and non-customer-obsessed respondents was significant.
- Expanding marketing responsibilities include business and technology decisions.
Over half of the respondents (53%) at customer-obsessed firms indicate that marketing acts as the voice of the customer to influence the business in key strategic decisions, including mergers and acquisitions. The rise of the marketing technology office in order to perform against this increased mandate was also much more prevalent at obsessed firms as they were 20% more likely to have their own technology office.
- Marketing data deepens collaboration and earns marketing leaders a seat at the executive table.
There is a quantifiable, statistically significant difference in the way CEOs, CFOs and business unit executives rely on and collaborate with marketing at customer-obsessed firms. This is definitely tied to our findings from #1, marketing’s proven ability to represent the customer better than other parts of the organization. Also, the likelihood that sales leaders collaborate with marketing is very different between customer-obsessed firms and others.
So, what’s most prominent in this set of findings about customer-obsessed companies? It’s that the majority of companies are NOT customer-obsessed!
Fifty-seven percent didn’t meet the criteria for customer-obsessed, meaning they don’t drive their businesses by improving customer experiences or build their strategies around customer insights. It's staggering to think that we’re 30% into the age of the customer, and 57% of companies are still waiting for the right train to come along.
Now that you know how customer-obsessed forerunners think, if you aren’t using those practices and thinking in those ways now, isn’t it time to shift? Sounds to me like a great time to get hopping.
Next week, we’ll dive deeper by looking at how marketing-led companies are outperforming their peers on the metrics that matter most.
*Forrester, “Marketing-Led Organizations Survive and Thrive in The Age of The Customer,” October 2015.