Over the last several decades, the Internet, email, social media and the cloud were born.
Yet you and your team still find it impossible to integrate your digital marketing efforts.
But taking an integrated approach to digital marketing doesn't have to be as difficult as you think. All you have to do is shift your focus from your company to your customers.
How marketing silos were born
Marketing departments evolved as new digital channels were invented -- and eventually adopted by consumers -- and innovative marketers found ways to leverage them:
- Websites in the early 1990s
- Email in the mid 1990s
- Internet advertising in the later 1990s
- Social media after the turn of the millennium
- Content marketing in the last decade.
Most marketing departments added teams to support these capabilities over time and continue to maintain them to this day as silos within their organizations.
But is this really the right way to do things when customers live in a seamless digital universe?
Leading companies in the financial services industry and beyond have adopted a customer-centric approach to marketing. They've abandoned the artificial internal marketing department silos built and hardened over the past few decades. While this might seem an obvious thing to do, according to an informative and enlightening article in Forbes, it's still rare for businesses to take an integrated, customer-centric approach to marketing.
What is customer-centric marketing?
According to Dr. Peter Fader, Co-Director of The Wharton Consumer Analytics Initiative at the University of Pennsylvania and a pioneer in the field, customer-centric marketing:
- Uses data to better understand and segment a company's customer base
- Leverages that data to identify the best potential customers
- Focuses all product and marketing efforts on those customers
- Uses a concept called Lifetime Customer Value to optimize marketing and maximize the profitability of those customers.
Dr. Fader also explains what customer-centric marketing is NOT:
- It's not about the "average" customer
- It doesn't waste time and precious marketing dollars on lower-value customers
- It never misses opportunities to engage with high-value prospects and customers.
Customer-centric marketing starts by understanding the lifetime profit potential of the highest-value customer segments of a company. It moves on to focus all digital marketing efforts on ensuring that the full profit potential for those customers is reached over time. This is a powerful marketing concept that's a far cry from the antiquated digital silos most firms rely on today.
How can you calculate the profit potential of your customer segments? There are many ways to go about doing this, and it's vital that you take the time to choose the one that's right for your business. This article clearly outlines some options and can help you understand the factors you should consider when selecting one for your company. Some are relatively simple, while others incorporate more challenging and hard-to-pin-down factors like the value of retaining customers over time and long-term brand equity.
It's important that you choose one that truly captures the long time profitability of each of your customer segments because every choice you make about your digital journey will be guided by it. This can help you feel more confident knowing that every digital marketing initiative is aligned with driving dollars to your company's bottom line.
Interesting fact: According to data from studies conducted by Dr. Fader, 66 percent of marketers don't know how much their customers are worth, yet they could increase their sales by 17 percent if they did.
What about those silos?
Adopting customer-centric marketing gives you the ammunition you need to blow up those silos and restructure your marketing department so it's focused on getting results, not accomplishing tasks.
Here are a few ways to do this:
Some companies re-align under a content marketing model. That's because they believe the best way to be customer-centric is to focus on the stories and messages delivered to customers as they move through the sales journey. This can make sense for firms that offer complex products and services that require careful messaging to drive sales.
Other companies center their marketing teams around a research group that provides data and insights about high-value customer segments. This can be a great solution for businesses that rely heavily on research and insights to sell products.
Another option is to come together around your internet and web-analytics teams. Since so much digital engagement and commerce happens on your website, focusing on the people who can generate web data quickly -- and update web content and online experiences on the fly -- could be a good solution.
No matter how you decide to reorganize, you must completely eliminate any legacy silos, and replace them with networks of employees that work closely together to develop, deliver, monitor and respond to consumer-centric campaigns.
Before you do anything, you'll want to educate yourself on customer-centric marketing. The Wharton School offers an excellent online program with Dr. Fader that could help you decide if it's the right solution for you and your organization. Dr. Fader's book is also a great resource.
If you decide to reorganize your marketing team, reach out to your human resource department to make sure you manage your organizational changes correctly. Getting this right is an important part of ensuring your team is behind you and supporting your customer-centric initiatives.
You should also talk to someone at an agency that has taken a consumer-centric approach to marketing for more than three decades. How you go about doing customer-centric marketing can differ depending on whether your "customer" is a bank, insurance or investment product buyer, financial intermediary like a banker, broker or agent, or another financial firm. Carpenter Group understands how to develop customer-centric strategies that will resonate with all these audiences.
What are you waiting for? Contact us today.