9 imperatives of the #better #cmo

shanghai | march 2014 | luca destefanis | twitter: @lucadeste!
9 imperatives
of the #better
#CMO
LUCA DESTEFANIS
IBM
SHANGHAI
March 2014

seeing the possibilities

LEADERSHIP!INNOVATION!RELATIONSHIP!
Know your customers
as individuals
Delight your
customers
Nurture the community
Build new skills for a
new world
Enable open,
sustainable innovation
Lead by design
Deliver the bottom line
Simplify the company
Create an authentic
brand and culture
The Better CMO

LEADERSHIP!INNOVATION!RELATIONSHIP!

The Better CMO knows customers as individuals
§  Instrument all the key touchpoints to gather the
right data about each customer
§  Connect social media data, transaction data and
other information to paint a more vivid picture of
each customer
§  Run real time customer analytics (descriptive,
predictive, prescriptive) to generate new ideas on
whom to serve, and how to best serve that
individual
§  Use social mining techniques to identify and target
micro-segments, and to refine product / services
offering
§  Build the capability to do this at a massive scale
the Better CMO…
Every minute, there are 100k new tweets, 6M Facebook
views, 2M+ Google search3

91% of CMO say they should use more customer data to
drive decision making, but 34% claims customer
data are collected infrequently1

35% of CMO has a thorough understanding of how
customers interact with the company1

Leading Marketers are 2.6x more likely than peers to
adjust real time offer based on context, delivering
personalized messages across channels2

1 CMO Study, January 2014!
2 State of Marketing 2013!
3 Internet in a Minute, 2013!

The US mobile operator masters the art of
customer analytics through calls data and
social sentiment mining to reduce churn rate
The leading sporting goods retailer in China
captures through its web, mobile and social
media sites all personal and shopping data to
launch precision-guided marketing initiatives
The Netherlands’ largest online retailer is
grabbing the attention of browsers and
abandoners with a comprehensive behavioral
retargeting program
A Hong Kong television broadcaster is using
sophisticated analytics to analyze its station’s
viewers, programs rating and greatly increase
the effectiveness of its advertising promotions
Dutch bank ING Bank personalized marketing
activities based on client data and online
interactions, and moved from campaign to
continuous dialogue with customers
Luxottica, world’s leader of eyewear captures
interactions across every channel on 100
million customers, to define highly segmented
customer behavior for targeted marketing
initiatives
The US retailer uses advanced mathematical
models to describe a customer’s behavior to
cluster customers based on motivation,
engagement and buying behavior
At Petco browsing behavior provides visibility
into the dynamics of online conversion,
helping the company to personalize
consumer interactions
*! *! *!
*! *! *!
*! *! *!
The Japanese retailer adopted a multi-channel
marketing platform to strengthen relationship
with its customers based on behavioral
analysis
*!

The Better CMO delights customers
§  Create personas and experience journey map that
deeply understand and consider customer needs,
drivers and emotions
§  Design tailored experiences that connect the
company and like-minded customers
§  Create and automate in real time a system of
engagement to deliver these personal interactions
§  Break down company silos, integrate channels
§  Build a system of shared valued and behaviors
that focuses employee activity on improving the
customer experience
the Better CMO…
36% of CMO have an integrated digital and physical
strategy1

16% of CMO integrate all the touchpoints across all
channels1

Leading Marketers are 5.6x more likely than peers to
use cross channels optimization technologies2

71% of positive customer experience translate into
loyalty, 65% lead to a product or service
recommendation3
3 Forrester North America Customer Experience Survey, 2011!

Finnish retailer Hong Kong Department Stores
builds an online e-commerce community
harnessing social networks to provide a richer
consumer experience
The airline uses social media and apps to
constantly dialogue with customers. Recently
KLM released a mobile app that allows
passengers to give real-time feedback on how
they perceived their experience at the airport
Ralph Lauren decided to implement a multi-
channel commerce platform for the Asia
Pacific business, spanning online, mobile,
contact center and brick-and-mortar
commerce
Wimbledon created an engaging and
interactive experience across multiple digital
platform: latest news, scores, photos and
tweets are always available and the fan can
feel part of the actions wherever they are
David Jones is the first major Australian
retailer to provide a true cross-channel
shopping experience. Customers can browse,
buy, pick-up and return items via a
combination of channels including their
phones, the online site and the physical store
*! *!
*! *!
*! *!
By gaining deeper insights into online
customer behavior, the airline company
redesigned the online web experience,
resulting in a 7% increase in online booking
The Italian brand re-invented the concept of
store, designing an immersive experience
offering all the best from apparel to arts, from
bookstore to cuisine
The outdoor apparel and equipment company
is testing how cognitive computing can craft
new approach to online store, designing a
system that conforms to people needs
By delivering excellence from product design
to post-sale service, Technogym is bringing
wellness in our lives
*!
*!

The Better CMO nurtures the community
§  Tie community engagement to Company mission
and values
§  View philanthropic investments as incubators for
promising ideas and a mechanism for
understanding both community and corporate
needs
§  Define specific policies to institutionalize
community engagement

§  Promote projects that are development
opportunities for both employees and the
community
the Better CMO…
92% of “Millennials” believe that success should be
measured by more than profit1

7/10 of US CEOs are developing strategies that
support the company bottom line1

59% of Fortune 500 increased philanthropy between
2007 and 20122, and 91% of contributions
are non cash2

1 The Wavemaker, Deloitte 2013!
2 CECP 2013!
!

At Whole Foods, each store donates food to
local food banks and shelters, and holds
community giving days where five percent of
that day’s net sales are donated to a local
nonprofit or educational organization
In 2003, Vodafone teamed up with United
Kingdom’s Department for International
Development to bring mobile banking
services to rural Africa
Starbucks mobilizes customers and
employees to be a catalyst for change in local
neighborhoods. In 2012, during April’s Global
Month of Service, volunteers made a
significant impact in with more than 2,100
community service projects in 33 Countries
With the “ Corporate Citizen Program”, IBM
sends team of employees all over the world
to address community issues
American Express supports organizations that
cultivate meaningful opportunities for civic
engagement for its employees and card
members, whether as volunteers, donors,
voters or patrons
The Chinese restaurant chain is deeply
involved in Community projects – in
celebrating great events and positive lifestyle,
and in helping to make Shanghai and
Beijing better places, as part of the company
mission to bring wellbeing to its customers
Through its “Framing Hope” program, Home
Depots diverts excess inventory from landfills
into thousands homes and lives every year
The US retailer hosts “Kids Workshop” where
children learn to make objects than can be
used in their homes or the communities
The Italian entrepreneur built its vision of
humanistic company on the core values of
sharing beauty and work ethic with the
community
*!
*!

The Better CMO builds new skills for a new world
§  Build an organization that operates like
consultants, execute like scientists, enables the
corporation
§  Consider to build the following capabilities:
-  Marketing scientists mastering descriptive,
predictive and prescriptive analytics
-  Behavioral scientists, cognitive psychologists,
social scientists, anthropologists, neuro-marketers
-  Trans-media storytellers
-  User Experience Architects, Design Thinkers
-  Social media experts: advisers, architects,
analysts, recipients, distributors, producers

the Better CMO…
82% of CMO feels underprepared for data explosion1

8% of CMO feel conﬁdent about the skills across all
the digital marketing areas2

40% of CMO are not able to ﬁnd talent to handle
digital workload1

2 State of Digital Marketing Talent, 2013!

The Digital Media Department leads the
creation, production, presentation, and
dissemination of multimedia content to
support the viewing and understanding of the
Met's collections
Coca Cola is much more a story factory than
a beverage factory. From Santa Klaus on,
people want to see themselves in the stories
Coke tells
Campbell's taps 'Neuromarketing'
techniques to find why shelf displays left
some customers cold, ending up with
altering labels
The US retailer is extensively using User
Experience Architect to revolutionize retail
and champion design
Rugby Football Union uses predictive
analytics to drive fan engagement and
deliver engaging, real-time insights into the
ebb and flow of rugby games – helping to
introduce new fans to the sport
*!
Significant Objects, a literary and
anthropological experiment, demonstrated
that the effect of narrative on any given
object’s subjective value can be measured
objectively
A retailer in France uses analytics-driven
behavioral segmentation to deliver highly
personalized messages that maximizes value
at every touch
*!
The retailer is leveraging sales analytics
collected at store level impacting the entire
supply chain from product design to store
stocks
*!
The US fashion retailer adopted storytelling
to communicate real examples of great
customer service from its employees

The Better CMO enables open, sustainable innovation
§  Break down organizational filters, internalize
consumer influence
§  Leave room for others to co-create with you,
providing a platform for open innovation
§  Explore and exploit new capabilities to help
customers achieve their desired results where and
when they want more quickly and efficiently
§  Pursue continuous innovation and experimentation

§  Design for sustainability, make sustainable product
count, actively promote a sustainable consumer
behavior
the Better CMO…
1 C-suite Study 2013
2 DBMG poll 2009!
3Sustainability’s Next Frontier, MIT Sloan Management Review, December 2013!
4InnovationWorx, 2013!
!
Outperforming organization are 1.6x more likely than
peers to collaborate with their customers1

67% of US consumers agree it’s important to buy
products with social and environmental
concern2

58% of companies rate social & environmental
issues very relevant sustainability concerns,
yet only 39% of them reports their
organizations are largely addressing them3

22% of companies declare innovation is hosed in
marketing4

The Australian brand of 100% plant based,
chemical free, is committed to bringing its
customers the most ecologically sustainable
home and personal care products
Nike ignites and drives sustainable
consumption supported by a completely
redesigned supply chain and product
development cycle
The automotive industry’s top-selling premium
car company has a leading role in advancing
individual sustainable mobility
At Henkel sustainability drives innovation and
product leadership. Each of the 750 company
brands strikes for a balance of People, Profit,
Planet
Revolution Foods mission is to build lifelong
healthy eaters by making kid-inspired, chef-
crafted food accessible to all
L'Oréal recently announced “Sharing Beauty
with All” the cosmetics giant’s ambitious new
sustainability commitment to transform its
footprint while achieving its business goals
The maker of outdoor gear and apparel is
continuing its campaign to persuade
customers to buy less stuff.
Rewoolution makes outdoor apparel in pure
Merino wool, 100% free of synthetic fibers.
Innovation, "green" sensibility and respect for
local craftsmanship heritage work together
Nest reinvented a simple product, that is
now driving innovation across multiple
dimensions, redesigning industries, value
chains, and customer choice

The Better CMO leads by Design
§  Think systemically

§  Design products and services tapping
unexpressed customer needs and aspirations

§  Use design methods (such as visualization and
prototyping) to solve business problems
§  Disseminate core design practices in all
departments to improve innovation across the
entire business
the Better CMO…
1 Danish Design Center 2003!
2 DMI design Value Scorecard Winter 2013!
40% higher increase in company revenue by
incorporating design activity in the core
company strategy1

Design-centric organization outperform the S&P Index
by 228%2

Design excellence is part of IBM’s DNA.
Today, the IBM Design Studios are devoted to
infuse in everyday life technologies like
mobile computing, analytics, and cognitive
systems
The Foundation developed a solution to help
microfinance institutions to align product
portfolio to client needs, roll out new
branches faster, reduce loan processing time
Rewriting the book on self-service, the
Australian airline designed an experience
that combines the sensing of passenger data
by well-placed kiosks and card readers within
the terminal with an energized and versatile
corps of roving service agents
*! *! *!
Mayo Clinic pioneered the innovation of
Doctor-Patient interactions by lunching a
dedicated research and design-oriented
institute that studies the end to end processes
of health care provision
P&G operates offsite design thinking
workshops that bring together employees
from across the company to use design
methods to solve real problems
Danish company LEGO has transformed the
process of its design functions, streamlining
product development and disseminating core
design practices in all departments to improve
innovation across the entire business
Apple embodies the concept of a business
driven by design. Starting with the idea of an
interconnected system managing any aspect
of our communication, from sound to image.
When the best and brightest managers from
GE they're stretched further over the two-
week training as they're asked to describe
their toughest problem in a haiku and draw
workflow and patient experience maps.
The focus on design-led innovation helped
Philips Lighting to transform itself over the
past decade from a company that pushed
products into the market into one that
designs them with customer desires in mind
*!

The Better CMO delivers substantial business results
§  Project and track financial return of marketing
investments
§  Focus on accelerating progress by identifying
projects that will help get started and deliver
short-term results and a transformative impact in
the next 6 to 18 months
§  Link operational metrics to strategic objectives to
financial performance, and drive ongoing interlock
with Sales

§  Track Customer Lifetime Value

the Better CMO…
12012 BRITE-NYAMA Marketing in Transition Study!
37% of CMO do not mention any financial metric
when discussing their results1

57% of CMO are not basing marketing budget based
on expected ROI1

22% of CMO are using brand awareness as the sole
measure to evaluate marketing spending1

Leading Marketers are 2x more likely than peers to
measure marketing based on Customer
Lifetime Value2

The largest Canada’s e-commerce
marketplace, launched in 2012, is the fastest
growing retails site in Canada, and amongst
top 10 most visited e-commerce sites
Cincinnati Zoo transforms customer
experience and boosts profits
IBM Business Analytics creates more than $2.2
million in total benefits, delivering full ROI
within three months
By adopting customer analytics solutions, the
Italian car maker Fiat increased response rate
to marketing campaigns of 20%
and improved customer retention by 7%
The US media company adopted innovative
web analytics solutions to improve click trough
rates by 45% and increase page views by 92%
The US educational publisher adopted
predictive analytics to shape personalized
marketing campaigned that generated 250%
more sales than traditional mailing
By offering dynamically generated, highly
personalized product recommendations, the
US retailer increased cross-selling to 16% of
total sales
The US marketing firm boosted its revenue by
1.000% in less than 4 years by applying
sophisticated predictive analytics models to
uncover trends across thousands of data
The outdoor retailer increased its revenue
from product recommendations by 70% by
engaging customers with timely, behavior
based during the selection process
One of the world’s largest hotel group, IHG
by personalizing messages, down to the
individual hotel / customer, increased revenue
per impression by 400% and revenue per
booking by 200%
*! *! *!
*! *! *!
*! *! *!
*!

The Better CMO simpliﬁes the company
§  Lead by “subtracting the obvious and adding the
meaningful” (John Maeda)
§  “Out of the clutter ﬁnd simplicity” (A. Einstein)
§  Limit the information, engage the imagination
§  Design remarkably clear and unexpectedly fresh
experiences
§  Re-engineer the company to deliver the promise
(breaking down silos and integrating channels and
content)
the Better CMO…
1 Global Brand Simplicity Index, Siegel+Gale, December 2013!
2 2012 BRITE-NYAMA Marketing in Transition Study!
The “simplicity” stock portfolio outperform by 100%
the average global stock index1

75% of consumers are more likely to recommend a
brand because it provides simpler experiences
and communications1

51% of CMO lack of sharing customer data across
the organization2

For simpler experience, people would pay 4.4% to
5.4% more1

The iconic fast-food
restaurant gets high marks for speed and
convenience, but also for its accessible menu,
transparent pricing and clear, concise
messaging
The Japanese retail company which sells a
wide variety of household and consumer
goods, is distinguished by its design
minimalism, emphasis on recycling, avoidance
of waste in production and packaging, and no-
logo or "no-brand" policy
European-based discount supermarket retailer
ALDI continues to enjoy extraordinary
success. With more than 9,000 stores
worldwide and a brand that “focuses on the
essentials” policy, that translates in 2 products
only for each category
By cutting out the clutter and paring it down
into a streamlined app people could
understand and have fun with inside 30
seconds, Instagram reached two million users
in only four months, a rate of growth faster
than Facebook and Twitter.
Toyota’s youth brand Scion xB model was
made intentionally spare by leaving out
hundreds of standard features in order to
appeal to the Millennial Generation, who are
prone to making personal statements by
customizing their belongings
The introduction of the new “Simply
Everything” plans was a key defining moment
in the turnaround of the US telecom operator
Recognizing that consumers are struggling
with complex financial products, the Chinese
financial institution Ping An brand promises to
make managing finances easier
Baidu is the biggest search engine in China,
and with the acquisition of 91 Wireless is now
entering the mobile search market
WeChat with its over 600 million registered
users and the launch of open API policies is
the new marketing favorite of many
enterprises

The Better CMO creates an authentic brand and culture
§  Develop an acute understanding of the company
reputation by actively listening and engaging in
social media
§  Systematically close the gaps between the
company’s unique character and its reality—in all
critical interactions
§  Champion tools that align the organization and
social business platforms
§  Ensure that systems are in place to manage the
risks of being a social business

§  Shelve the commercial pitch in favor of authentic
storytelling
the Better CMO…
1 Meaningful Brand Index, Havas Media, 2013!
20% of all brands are seen to meaningfully positively
impact people’s live1

The Meaningful Brand Index outperforms the stock
markets by 120% - as much as top hedge
funds1

In Asia, people’s relationship with brands is stronger:
people perceive that 39% of brands
contribute notably to improve people’s quality
of life and would care if 51% of brands
disappeared 1

The Spanish financial institution ensures that
its brand and its culture are authentically
aligned by continually monitoring and
assessing reputational risk.
*!
Haier shifted its mindset from selling products
to selling services and encouraged employees
to face the market directly. In doing so, it
fulfilled its consumers’ needs for
customization and personal attention
Nongfu Spring Water is acting as enabler to
well-being, enhancing daily lifestyles and
contributing to community development
The Japanese electronic is still the brand that
is engaging at best in creating emotional link
with his customers in terms of “curiosity” and
“pride”
Nestlé ranked #1 for the social and
environmental impacts amongst the world’s
ten largest food and beverage companies
By living everyday on its own principles, Walt
Disney was rated #1 in 2013 for Global
Reputation and Most Loved Companies
The Chinese e-commerce company is building
a strong reputation for trust – where “fakes”
and mistrust is part of the daily practice
The core values of Trust and Responsibility,
Innovation That Matters for Clients and the
World, Dedication to Client Success are fully
embodied in IBM culture and all the business
management practices
IKEA embodies the culture and the values of
its founder, and the brand it’s recognized to
be meaningful, accessible, and transparent
*!
*!

1.  Know Your Customers As Individuals
2.  Delight Your Customers
3.  Nurture The Community
4.  Build New Skills For A New World
5.  Infuse Open, Sustainable Innovation
6.  Lead By Design
7.  Deliver The Bottom Line
8.  Simplify The Company
9.  Create An Authentic Brand And Culture
9 Imperatives for the Better CMO

Luca Destefanis
@lucadeste

9 imperatives of the #better #cmo

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