Today’s rate and pace of technological innovation is blistering. In its wake entire industries are being tipped askew; some are converging, some emerging and others are being overtaken by new competitors. Just consider the impact of Uber’s mobile app business model on the taxi industry, or Airbnb’s online marketplace on the hospitality industry.
Chief marketing officers (CMOs) are on the front line in this age of digital disruption. Indeed, they’re more aware of potential pitfalls than CxOs in any other role. For the recent IBM Institute for Business Value’s special report Redefining Markets: Insights from the Global C-suite Study – The CMO Perspective IBM surveyed 723 CMOs from around the globe and found:
- 67% of CMOs anticipate much more convergence in the next few years; and
- 60% of CMOs expect more competition will come from outside their industry versus from within.
How are CMOs navigating these turbulent times?
Those who are market leaders are embracing this creative destruction; striving to make their organizations more digitally literate, deepening their engagement with customers and injecting more data-driven insights into every marketing decision they make.
It’s the customer journey that matters, not just the destination
While 82% of leading CMOs are studying the customer journey more carefully—all with an eye to developing deeper, richer customer experiences—they are also becoming more data savvy. They realize that analytics tools are key to more accurate, targeted marketing strategies; allowing them to better engage with ever more sophisticated customers.
With 2.5 quintillion bytes of data created every day—the equivalent of 170 newspapers being delivered daily to every man, woman and child on the planet—CMOs understand that only data-driven decision making will allow them to deliver relevant, timely customer interactions on a large scale. By leveraging predictive and prescriptive analytics, retailers are better able to identify the best marketing plans and pilot cognitive technologies, which have the potential to reinvent customer interaction. Indeed, 69% of leading marketers are leveraging predictive analytics and 45% are using prescriptive analytics all to explore new trends in the marketplace.
Cognitive commerce is also an emerging trend that harnesses the power of data and analytics to provide businesses with a better understanding of their customers in increasingly new ways by learning about their specific behaviours, personalities and emotions, as well as identifying which brand messages resonate most. These insights allow marketers to build relationships and interactions that foster stronger customer engagement.
The disrupted has become the disruptor
Take the North Face, an outdoor apparel, equipment and footwear company which recently launched an interactive online shopping tool powered by Watson and built by Watson developer partner Fluid. Using IBM Watson’s natural language processing ability, the tool will help consumers discover and refine online product selections based on their specific responses to a series of questions. For example, a shopper could type: “I need a jacket for a Vermont ski trip.” They are then asked refining questions on factors such as gender, activity and time of year, and then receive a recommendation that meets their specific usage and climate needs. Deep insight gathered through these responses will enable the retailer to create a more engaging shopping experience. Currently in beta, the tool has yielded positive feedback and results.
In Canada, Buffalo David Bitton—a global fashion brand headquartered in Montreal, Quebec—is looking at ways the company can integrate cognitive technology capabilities to analyze massive amounts of unstructured data to further extend its business performance. By better understanding consumer behaviours, the retailer can deliver more personalized products and services that meet growing consumer expectations. Until recently, the company used advanced analytics and performance management tools within their business channels to understand sales trends and increase product and vendor performance insight. With cognitive commerce, Buffalo David Bitton expects to directly connect to their customers, stay competitive and increase market share.
Not only does marketing analytics and cognitive commerce provide marketers with the insights they need to gain superior results, it also helps them understand which actions will build more profitable relationships with customers, how to generate better ROI from marketing programs and how to transform the flood of social media data into successful marketing strategies.
According to one of the participants in IBM’s CMO study, Lisa Claes, chief customer officer at ING Bank: “Industry competition is heating up and businesses must sharpen their focus on the customer or risk losing them to the competition. By embracing the latest analytic and cognitive commerce technologies, marketers can tap into this explosion of data to deliver a personalized customer experience precisely at the right time and place.”
You can find “Redefining Boundaries” at ibm.biz/cmostudy, or via the IBV tablet apps on iOS and Android.
This article originally appeared in the May 2016 issue of Direct Marketing.
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