I’ve been working with executive-level marketing leaders for more than two decades — sometimes as an FTE lieutenant, often as an agency partner, and most recently as a trusted vendor. I’ve watched the role of the CMO be created, seen it hammered into an almost impossibly tough job, and emerge as a power role with an accelerating budget and voice.
Yet I still see the same failures in thinking that holds organizations back. This was clear to me twice this week. Firstly, I was reading the 2013 CMO Study from Duke University’s Fuqua School of Business that was released last month. And then, I was on a panel at Marketing Sherpa’s Lead Gen Summit 2013 that was focused on lead cost. The fundamental gap I saw in both places was that senior-level marketers are still obsessed with leads and prospects — often to the detriment of current customers. I’ve called it the “shiny rock” syndrome for the better part of a decade.
Without turning this post into a diatribe on relationship or retention marketing versus acquisition marketing, let’s all just agree that it’s easier (and most times more profitable) to retain your existing customers. The challenge is it can be harder to truly understand your customers, create incredible communications streams that exceed their expectations, and define new products that deepen their advocacy and spend. But isn’t that what a CMO is hired to do?
So when I read survey question summaries from the Duke study like “Firms decrease market penetration and move toward riskier growth strategies in next year,” it worries me. I remember in the early- to mid-2000s when the average tenure for a CMO was under two years (the number 22 months was seared into my consciousness sometime around 2004). Talk about not being around long enough to even begin meaningful change. Those were dark days.
But today, that number has increased to 45 months according to SpencerStuart’s most recent data – and it’s trending even longer. So how do we take advantage of this? The answer is both simple and difficult. We have to focus on top-line growth with great lead management strategies like we discussed at the Lead Gen Summit this week – but perhaps even more importantly, we have to triple down on retaining our existing customers. This means knowing more about their motivations, buying preferences and things they love. And yes, I use the word love because if you’re not creating a deeply personal bond with your customers, your competitors or a brand-new start-up will soon be targeting them.
So go take on those big retention marketing challenges that have huge ROI. Staff the people and procure the technology that gives you direct access to your customers and leverages every single thing you could (or should) know about them. Create a marketing organization that’s numbers-driven in its decision-making, but supremely human in its customer approach. Be as hard on customer support metrics for your internal staff as you are on lead-cost metrics for external vendors. You’ve got the runway, so now’s the time to be bold.
1) Tip Sheet: “7 Tips for Creating an Effective Modern-Day Loyalty Program”
2) Video: “Loyalty Program Tip: Look for New Ways to Differentiate the Customer Experience”
3) Blog: “Purchase Behaviors, Promo Codes and Offers, Oh My!”