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How Brand-Demand Love Wins Across the Marketing Lifecycle

The second post of a series about integrating brand and demand marketing capabilities to win in a complex and dynamic landscape, based on our conversations with CMOs across industries.

As we highlighted in the first post in our Brand-Demand Love series, we think it’s time for a more integrated and complementary relationship between brand and demand-gen marketing. Why? Because the current separation isn’t aligned to the dynamic purchase behaviors of consumers across an increasingly complex landscape. As Karla Davis, VP of Marketing at Ulta Beauty, told us:

“What is brand, and what is demand? That’s a little gray now.”

Karla Davis, VP of Marketing at Ulta Beauty

When accomplished senior marketers question the validity and usefulness of the traditional brand-demand paradigm – and many do – then surely, it’s time for a new model. After all, the effective coordination of brand and demand-gen activation strategies represents an integrated and agile marketing capability – the gold standard amongst marketing pros.

Feeling the Brand-Demand Love Across the Marketing Lifecycle

Brand and demand-gen activation cannot be viewed as separate or competing functions, but rather as interdependent and mutually reinforcing capabilities that comprise the core of the overall customer experience.

Each set of tactics has a significant role in attracting buyers and strengthening relationships at every step of the customer journey and across the entire lifecycle. But, taking the perspective of marketers, it’s easy to see why the brand-demand balance is fluid. When considering marketing activation investments, companies might adjust their orientation as:

  • Brand-led
  • Demand-led
  • Balanced

As business objectives evolve and companies navigate distinct phases of maturity, the optimal marketing approach will vary. For instance, a brand needing to differentiate from a competitive pack may need to be brand-led to generate awareness and consideration, while a business undergoing a portfolio launch, expansion or refresh may have more balanced brand-demand priorities.

For businesses focused on customer acquisition or market share gains, demand-led models will serve their immediate priorities in tandem with brand campaigns. Many direct-to-consumer brands, unique in their offerings, initially focused on acquisition only to shift towards brand marketing as their category became crowded. Mature organizations that find themselves at a point of market saturation and businesses without fully defined offers will both rely on brand-led marketing efforts to develop, sustain and enhance customer relationships.

Learning from Airbnb

Airbnb’s decision to cease all demand generation activities coming out of the pandemic suggests just how much the brand-demand pendulum can swing. When the pandemic shut down all travel, the company eliminated its marketing activation spend, which totaled $1.62 billion in 2019. As lockdown restrictions eased, Airbnb saw most of its traffic return to pre-pandemic levels, prior to re-investing in marketing activation campaigns.

“I don’t anticipate doing a lot of incentives because we have a huge amount of demand for the service already,” Airbnb CEO Brian Chesky told CNBC. “We are never going to spend the amount of money on [demand] marketing as a percentage of revenue as we did before the pandemic [because] our brand’s incredibly strong.”

Not every brand is Airbnb, of course, and it’s far more common for brand marketing spending to get in the crosshairs of budget cutters. The brand-demand mix is fluid for large and small marketing organizations. Other companies will find they need a different balance at different moments within their growth curves and maturity cycles.

External factors also play a role in defining the right balance at the right time. Social issues, including diversity and inclusion and climate change, are leading some companies to deploy brand spending to align with important causes.  Ashley Laporte, director at the communications firm RALLY explained her company’s approach as “Less about cause marketing, and more about helping companies take part in driving systemic change.” Taking positions that consumers support may lead to some increase in demand, but it will be hard to attribute sales directly to, say, thought leadership regarding a company’s commitment to net-zero admissions.

Another CMO in the manufacturing industry said she wanted “credit from business leaders, the board and institutional investors” for effectively positioning the brand relative to these issues, especially since it made the business more attractive to rising generations of workers.  An industry analyst told us, “Brands are being tortured with the cultural and societal unrest that’s out there,” and not just because investments related to these tricky issues are extraordinarily hard to measure.

What’s Love Got to Do With It?

Mastering the brand-demand mix means being flexible and committing to making necessary adjustments over time, like those that take place across the course of loving relationships. One partner’s needs may take precedence during a certain phase of life, but afterward, things rebalance as conditions change. It’s never exactly 50-50 (or 60-40 as in the famous Binet & Field model for budget allocation, which we’ll explore in more detail in a future post). Such a rigid formula may cause opportunities to be missed and doesn’t match the real world, where marketers must continuously adjust based on changing market conditions and business needs.

The new research report, “Brand and Demand: A Love Story” is here! Learn how today’s Brand and Demand Generation leaders are bringing their functions together to drive greater impact.
Download today!


FINAL THOUGHTS

We suggest speaking the “language of love” to business leaders and other stakeholders who struggle to see beyond the numbers in evaluating the merits of brand investments. The key is to connect business objectives to the power and resonance of brand. Marketers that can bring empathy and emotional intelligence to these conversations will be more likely to find supportive partners – and isn’t that what we’re all looking for?

In our next post, we look more closely at proven principles for shaping effective go-to-market strategies – the “vows of the brand-demand marriage.”

Get in touch today if you’d like to learn how to bring brand and demand together to win across the full marketing lifecycle.

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A Guide for New CMOs

For a crash course in what to do first, plan your listening tour and ask the right questions.

Are you in a new role as chief marketer, or perhaps new to your category? This simple guide offers straightforward ideas and insights that can help you succeed.

To start, think about what you need to do in your first 100 days. It is important to consider:

  • Do I need to develop a transformation agenda?
  • Can I create a more compelling go-to-market strategy?
  • How can I make our brand more relevant to customers?
  • Are there foundational tools to put in place, such as a documented customer journey or a marketing plan?

Given the rapid change in marketing and the greater need to prove immediate impact, we help new CMOs flex the most impactful levers including content, data and digital marketing, as well as reimagine their marketing organization for the modern era of growth engine marketing.

Here’s a quick guide of what to ask, what to do and where to look in the first 100 days.

What to Ask

Asking the right questions up front can help craft the right agenda, identify potential initiatives and create an actionable roadmap. Below are six questions you should explore with your team, colleagues, and agency partners.

  1. How relevant is/are your brand(s) to your most important customers and stakeholders? How relentlessly focused on the customer are insights, strategies and tactics?
  2. Is the marketing strategy aligned to the business strategy? What is marketing’s contribution to the enterprise? How do the rest of the C-suite and the board see marketing’s role?
  3. Are brand and demand priorities clear and integrated—or in competition and at odds? Is there a portfolio marketing strategy in place or is the strategy purely product-focused?
  4. How are you going to engage and empower the sales, communications and product teams? Is there a shared end-to-end customer journey? What culture of collaboration exists or doesn’t exist?
  5. What is the maturity level within the marketing organization for key digital capabilities such as customer data, content, personalization and attribution?
  6. Is your marketing team organized in the most efficient way possible and around your business priorities? How might you set up your operating model?

 

What to Do

Here are some recommended actions passed on from other leaders, proven to get you on solid footing and off to a smart start.

1. Schedule your listening tour

Meet with your direct reports and colleagues across the organization, and ask these questions: What do you want me to create? What do you need me to protect? What do you need me to prioritize? Be sure to share back the results and your plan.

2. Create these CMO assets

  • Introduce Yourself Presentation: Prepare a “top 10 list” presentation that addresses these questions: Who are you? Why are you here? What kind of change initiative are you leading? What do you believe about marketing? What do you value? How do you like to work with others? What are your top priorities? What are key milestones for your first six months? What do you expect from your team? What can they expect from you?
  • Vision, Agenda and Roadmap: These are often created in a workshop over a few weeks with a suite of collaborations They should include a description in which the brand can fulfill the business potential, and the springboards, or starting places, that exist now. One key artifact to create is a dashboard to help track progress.
  • Growth Era Marketing Plan: This plan is a modern replacement for the integrated marketing plan and has many of the conventional elements updated for marketing’s new role as a growth engine for the enterprise. Topics include business vision, opportunities, strategies and tactics, customer data strategy, calendar, investment, and key enablers (e.g. content, technology, people, partners).

3. Work in outcomes

Translate your priority initiatives from marketing objectives to business impact. For example:

  • Reducing cost: Investing in a content strategy that leads to search engine optimization will, for the business, reduce the cost of digital marketing that may need to be done.
  • Increasing revenue: Engaging in brand and marketing campaigns that increase customer loyalty can, for the business, increase the share of wallet and customer lifetime value.
  • Improving efficiency: Improving digital experiences can be a reason for a prospective client to work with you, therefore improving the volume of incoming leads, lead quality, conversion rates and retention.
  • Product innovation: Customer insights gleaned from marketing activities and shared with product management can optimize product performance and uncover new opportunities.

Ask your teams to quantify and report their work against broader business impact, not only marketing KPIs. A dashboard that integrates marketing KPIs and business performance can help sustain that conversation and connection.

“When asked business questions (e.g. what have you delivered for the business?), don’t give marketing answers (e.g. NPS).”

Raja Rajamannar, Chief Marketing & Communications Officer, Mastercard

Where to Look

Prophet helps new and tenured CMOs set an agenda and transform their marketing inside and out. Talk to David Novak, Mat Zucker, Marisa Mulvihill and our brand and marketing strategy teams. Here are some additional resources which might be helpful:

Books

  • The Next CMO: A Guide to Marketing Operational Excellence, Peter Mahoney, Scott Todaro and Dan Faulkner (2020)
  • Lies, Damned Lies and Marketing: Separating Fact from Fiction and Drive Growth, Atul Minocha (2021)
  • Chief Marketing Officers at Work, Josh Steimle (2016)
  • CMO Manifesto, John Ellett (2012)
  • Owning Game-Changing Sub-Categories, David Aaker (2020)
  • Creating Signature Stories, David Aaker (2018)

Articles & Speeches

Podcasts


FINAL THOUGHTS

The Chief Marketing Officer is a C-suite role that can lead, shape, and help deliver uncommon growth for the organization. Marketing is evolving fast, and every leader—new or tenured—needs the mindset and toolset to stay in front.

Reach out to our brand and marketing experts for advice and support on getting started with your agenda.  Have a resource we should mention? Let us know.

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Brand and Demand Marketing: A Love Story

Marketing has always been shaped by shifts in consumer behavior, expectations and technology advancements, as well as its contribution to the enterprise. As the scope and speed of such changes expand and accelerate, it is more difficult for brands to know which types of campaigns and media work best, and the growth to which marketing can contribute.  

They must make hard tradeoffs in deciding where to invest finite resources, how to differentiate amongst competitors and how ambitious they need to be as a growth engine. Are the tradeoffs—and competition between forces—helpful or harmful? 

Today’s marketing industry feels different, according to our recent candid conversations with a dozen senior marketing leaders across industries. Customers are harder to reach and engage, even though we have vastly more data and insights about them and stronger personalization tools. Budgets are tighter and internal stakeholders more demanding. Tried-and-true best practices no longer apply. There’s a sense that rules are being rewritten in real-time. The once useful “marketing funnel” concept seems less relevant given that consumer behavior changes constantly and paths to purchase are increasingly non-linear.  

As a result, many marketing organizations experience significant tension between brand marketing and demand generation – a tension we believe undercuts growth and harms performance. Brand marketing typically describes long-term efforts to drive awareness of and preference for a company, product or service, while demand marketing seeks to get audiences to take action immediately (e.g., click on an offer, sign up for a newsletter).  

“This topic is one of the things that we’ve [been] trying to understand – where in the funnel do we need to spend our dollars in order to really drive business results and drive growth.”

– TD Bank, CMO

As the CMO of a challenger consumer goods brand told us, “Brand is about growing awareness and affinity over time,” while the primary objective for demand, or performance marketing, is “driving short-term conversion.”  

The “either-or” bifurcation of marketing into these categories presents huge challenges as marketers seek to optimize budget allocation, track performance and structure their teams and operations to drive uncommon growth. The worst part, the split between brand and demand generation isn’t aligned with consumers’ consumption patterns in today’s world.  

As a senior industry analyst told us, “Consumers have zero separation between the brand being communicated and their experience. In finding the right investment for brand and demand, it’s both, not versus.”  

Stop the fighting and find the love.

This article, the first in a series, is based on our recent market research with senior marketing executives and focused on the specific internal and external challenges CMOs face today related to brand and demand. These marketers also highlighted the levers they have at their disposal to create effective and integrated brand and demand strategies.  

Every marketing executive we talked to confirmed the importance of finding the right balance between brand and demand. We also heard repeatedly what a difficult balance it is to strike; everyone agrees that brand and demand efforts must be coordinated and synchronized. However, how to do this is much less clear. Despite the interdependence of brand and demand marketing, many tricky questions remain: 

  • How much impact does brand marketing have on conversion?
  • How does customer acquisition efforts influence brand perception?
  • What’s the optimal level of investment across brand and demand?
  • How can brand and demand show up most effectively across channels?

“This topic comes up all the time, in the B2B context, the brand piece is a hard sell because our team doesn’t understand why it’s important.”

– Trane Technologies, SVP of Marketing

In our brand and demand blog series, we explore this important conversation with a modern lens, examining how marketers can embrace the brand-demand love. Specifically, we’ll cover:  

  • The seasons of love: Understand why brand and demand are meant to be together and how they can overcome obstacles to love across the marketing lifecycle – we’re playing a long game 
  • Writing the vows: Set a strong strategic foundation, because every brand-demand marriage needs a rock-solid foundation of what it stands for and how it will approach the market – when to say “I do” and when “I don’t” 
  • Shared finances: Create shared goals and an investment agenda, define smarter metrics for allocating the shared pocketbook, or budget, and track the performance of those shared investments – brand and demand should not fight about money 
  • Setting up the household: Determine how to organize teams and build the right capabilities – brand and demand need a comfortable nest 

The new research report, “Brand and Demand: A Love Story” is here! Learn how today’s Brand and Demand Generation leaders are bringing their functions together to drive greater impact.
Download today!


FINAL THOUGHTS

We think it’s time for brand and demand to stop thinking of themselves as competing interests fighting for the same precious resources. Rather, they must be complementary companions with a shared agenda and intertwined goals. We believe it’s time for brand and demand to fall in love because together, they are the ultimate power couple to build relevance and unlock uncommon growth.   

Get in touch today if you’d like to learn how to bring brand and demand together to unleash the full power of your business.

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Nine Digital Shifts to Sustain B2B Companies During Trying Times Trends in Digital Innovation

Supply chains and alternative channels take on outsized importance.

The biggest challenge for today’s businesses is to consistently produce personalized content at a large scale, deliver it at breakneck speed, and credibly have an impact on revenue. The businesses that are successful in this endeavor have invested in an innovative set of capabilities that make up an “Agile Content System”.

Digital transformation in normal times is usually considered a growth opportunity – and it is.  B2B companies coping with the pandemic are also demonstrating that shifting to digital can provide important benefits in sustaining the business through:

  • Alternative channels for customer engagement – the use of Zoom, Teams, Slack, and other forms of collaboration and meeting apps have skyrocketed
  • Keep parts of the supply chain operating – ecommerce has proven less vulnerable to disruption than call center or face to face channels
  • Lower costs – by using data analysis to uncover and target expense reduction
  • Preserve cash flow through business model redesign – SaaS business models are providing a valuable cash flow buffer in the face of decelerating demand.

These benefits are crucially important in this unsettled period, but they will also be valuable once the crisis recedes. Digital marketing and selling, digital experience innovation and digital operating model renovation stand out as three digital transformation shifts that leaders can use to sustain their business as much as possible during this crisis as well as to accelerate customer demand once the economy rebounds.

Identifying and pursuing quick digital wins that can also elevate future performance has become an immediate imperative for B2B leaders.  The purpose of this article is to provide guidance on where to look and what to prioritize in each of the three transformational shifts. Our recommendations are based on the discussions with B2B leaders and examination of successful cases of B2B digital transformation we conducted for our forthcoming book The Definitive Guide to B2B Digital Transformation

Digital Selling and Marketing:

In such uncertain times, the best customer for most B2B businesses is the customer they already have.  Current customers are much more likely than new prospects to buy, have a lower cost to serve and will be more willing to endure the delays and interruptions their current suppliers encounter.  Using collaboration and virtual meeting tools to enable sales teams and intermediaries to connect with buyers who are working from home is only a first step.  Customers have a need to be connected to a bigger picture about what’s going on in the market, in the supply chain and even in different parts of their own company. They may require frequent updates on even small issues that previously wouldn’t garner their attention but are crucial to keeping their business afloat. And, customers need help to figure out new paths forward and rapidly find alternatives as business conditions change.  There are several use cases to increase the use of digital to focus on existing buyers:

Account-Based Marketing (ABM) has never been more important.  It is a superior way to coordinate the efforts of sales, digital marketing and service to meet the information and relationship needs of the full set of stakeholders, influencers and decision-makers in current accounts.  ABM can be set up in the basic form in a matter of weeks and then can expand and grow. When the economy improves it can take on the added task of improving prospecting and new customer acquisition.

Digital customer insights and analytics become essential when the routine ways of monitoring a category through face-to-face interactions among industry ecosystem participants break down.  Consider opening up an industry “war room” to buyers who can join virtually or receive insights through an email or online feed. Enable the war room with social listening, digital surveys, scouring the internet for news and monitoring key data sources.  Once the current crisis is over the war room can become a source of insights for innovation or a value-added service that can build a competitive advantage.

Direct Ecommerce may be the only way to keep the parts, accessories and supplies flowing that keep customers in business.  For service providers, it may take the form of shifting in-person services to digital channels.  Barriers put up by intermediaries such as agents, distributors, and systems integrators can prevent suppliers from undertaking commerce directly with their customers.  In times of crisis, these barriers will come down; enabling both supplier and customer to sustain a revenue stream while establishing a direct connection that will be very valuable, and hard to turn off, when conditions improve.

Digital Experience Innovation:

Most mid-size and large corporate customers have a built-in divide between the purchasing department and the user of the supplier’s goods and services.  In situations like the pandemic, operations become more siloed and day-to-day connections between the buyer, supplier and user can fray. Users can feel isolated and unserved.  Digital experience innovation plays a valuable role by meeting the needs of the user around the clock with less human intervention from the purchasing team or the supplier. The use cases for user support span the entire customer experience. They include:

Virtual Technical Support can be the lifeblood for corporate users struggling to find new ways of working and encountering new or unexpected bottlenecks as they try to patch together approaches to keep doing their jobs. B2B suppliers should consider ways to open up their expertise online.  Can training guides, specification sheets, and other materials intended for the technical support team be made available to customers online? How about setting up a Virtual Technical Support SWAT team that can swoop in after an initial online meeting and use collaboration tools to solve complicated problems (systems integration challenges, supply chain workarounds, etc.) more quickly than normal? The service may be essential during the pandemic but could save travel and speed problem resolution when times return to normal.  Collecting data on problems and their resolution can later enable AI-driven systems to automate the service in the future.

Online Learning becomes a necessity when there is no readily available source for corporate users to learn how to work with new components, become familiar with a crucial application, or manage a novel service because a supply chain disruption changed their normal routine. Avoid becoming entangled in long lead times to develop a new curriculum by setting up an online listening function to understand what challenges customers are facing. Then, empower sprint teams to create videos and audio-assisted documents to fill the need.  The production flaws will be forgiven in a time when help will be so appreciated.  Later on, the content can improve the larger curriculum and responsive listening can inform technical support and solution innovation.

A Digital Bulletin Board is an excellent and inexpensive way to keep customers informed of what’s going on from a supplier and industry point of view.  It can span multiple topics from immediate steps to mitigate health challenges, to information about shortages or substitute offers to information about how others in the industry are coping with important challenges.  It can be a tool for employees to stay informed as well as customers. At a time when many in an industry are looking inward, it can elevate the presence of the supplier within the customer as a source of information and expertise and provide a platform for continued use once the pandemic has receded.

“Digital marketing and selling, digital experience innovation and digital operating model renovation stand out as three digital transformation shifts that leaders can use to sustain their business as much as possible during this crisis as well as to accelerate customer demand once the economy rebounds.”

Digital Operating Model Renovation:

Many of the world’s companies may be heading for a cash crunch and resource imbalances over the next few months. Now may not be the time for thinking about how the operating model can be redesigned, pursue new customers, or enter new markets.  It is time to consider important, and significant moves to improve the effectiveness and efficiency of the business in ways that will be sustainable for the next few years.

Subscription Revenue Models provide a more sustainable revenue stream in times of uncertainty and in normal times.  They also lower the initial outlay customers must make for important purchases. A shift that can be extremely valuable for cash conserving customers.  There is usually a huge timing hurdle to overcome when converting transactional purchases to subscriptions because large initial revenues must be given up by the supplier in favor of a revenue stream that is spread over months or years.  This period of economic pause may be an ideal time to move to subscription because demand is already depressed, interest rates are low, and investors may be willing to endorse any move that sustains revenue.  The long-term benefits will be substantial, and the normal short-term barriers may be easier to overcome.

Cost to Serve Reconfiguration is a topic, that although very sensitive, cannot be overlooked. In normal times it includes thinking through how automating processes or investing in new digital platforms can reduce labor costs and generate bottom-line savings.  However, this is not the time to install major new systems or make uncertain employees fear for their jobs even more than they already do.  It is the time to collect data, measure, and evaluate whether the new selling, marketing, technical support, online education and digital communication approaches can be optimized and scaled after the crisis has subsided to lower cost to serve, boost employee work-life balance and improve customer service.  Treating the crisis as a series of pilots and experiences requires collecting data and measuring impact. The benefits for ongoing operations can be as profound as the short-term gains these changes produce.

Agile Process Redesign is at the heart of going faster and incorporating customers into the design process for many organizations.  The importance of quickly bringing new solutions to market or rapidly adapting current solutions has been made abundantly clear in the past several weeks.   Most corporate leaders have dramatically stepped up their planning but are struggling to accelerate the pace of the work that actually gets done. This is an ideal time to introduce agile teaming methods to the workforce.  There is no shortage of projects that need rapid attention, the case for change is apparent to employees and these methods can be deployed quickly with fairly low investment.  Agile methods have numerous additional benefits in driving leadership accountability, clarifying project status and ensuring that projects remain customer-focused even when moving rapidly.  The payoff is immediate and the benefits for the organization when things improve are substantial.

By Fred Geyer (Prophet) and Joerg Niessing (INSEAD), authors of the forthcoming book The Definitive Guide to B2B Digital Transformation. 

Watch this video to learn more.


FINAL THOUGHTS

The nine digital shifts described in this article are a starting point for thinking through moves to make to sustain B2B businesses in an unprecedented time while laying the groundwork for future success when this crisis recedes.  We have tried to be pragmatic by recommending moves that can be implemented in the short term and will be valuable to customers, employees and the business for the future. This is not the time to wait.  Leaders who act now can strengthen their options and improve their chances for success.

If you need help figuring out what path to take now, in the next 6-8 months, or beyond, please don’t hesitate to reach out. We’re happy to have a conversation. Also, if you have any questions you’d like answered by our experts, drop them into the comments below or reach out directly here.

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Bringing Luxury Online – Finding Success with DTC Marketing Tactics

Companies like Gucci, Moncler and Louis Vuitton are reaching young shoppers with disruptive digital tactics.

Luxury retail as we’ve known is over. It’s ‘last season’ exclusivity and high barriers to entry are shifting toward online democratization. Critical to this redefined luxury is an effortless curation of content, community and commerce tactics to win the hearts and wallets of digitally and socially aware consumers.  

Let’s look at how successful luxury brands are using DTC marketing tactics to reach new audiences. 

Content: From Fashion House to Content House

the core of any direct-to-consumer model is the creation of content and the spurring of relevant discussions among loyal customer bases and beyond.

From curated city guides to an Instagram feed that gives Vogue a run for its money, Louis Vuitton’s Louis Vuitton City Guides has a firm grip on the digital content pulse.

These guides highlight must-visit sights, stores and snacks in major cities across the globe, offering customers a glimpse of the world and what it’s like as a Louis Vuitton jetsetter. With new cities added frequently, Louis Vuitton is keeping customers engaged with more insider guides and luxury travel accessories to outfit their journeys.

Additionally, brands like Moncler are vying for a Gen Z following on digital platforms such as TikTok, which has been steeped in DTC marketing since its inception. Through its #MonclerBubbleUp challenge, Moncler leveraged both paid and organic content marketing – including dynamic products, collections, and lead generations ads – to reach nearly 7 billion impressions including those from followers who used #TikTokMadeMeBuyIt when featuring Moncler products in their content.

Community: Access to Luxury Doesn’t Have to be an Alternate Reality

In the old days of luxury retail, tight-knit brand communities were often limited to those in the upper-echelon of customer spending. The feeling of exclusivity and access was often formed through limited in-person shopping experiences with customers donned from head-to-toe in the brands’ latest offerings. 

Today, brands are moving these communities and their associated status symbols online. In the digital world, consumers have a direct route for engagement with brands through their DTC marketing channels and content – and feel closer to brands beyond a purely aspirational intent to purchase their goods.  

Gamification is one such method brands are leveraging to redefine what it means to be a part of the luxury community. For example, in honor of its 100th anniversary, Gucci aimed to spur engagement among its online communities. To do so, they teamed up with Roblox to launch the Gucci Garden Experience, a digital experience experiment in the metaverse. Users were transported to ornate showrooms where they could browse and interact with digital versions of exclusive Gucci products. They also had the opportunity to ‘purchase’ luxury items to ‘guccify’ their metaverse. The event spurred visits from more than 1 million Roblox users.  

By departing from tradition and leaning into democratized innovation, Gucci led a luxury brand movement toward new ways of engagement through innovative spaces and online communities, ultimately creating a loyal customer base.  

Commerce: See Now, Buy Now

Fashion Weeks across the globe are known for their exclusive invite lists and designs. However, brands leading the way in the new era of luxury are challenging fashion week norms and creating increased access through a ‘see now, buy now’ approach. This allows viewers to purchase designs in real-time as they are revealed on the runway rather than waiting for exclusive commercial releases and has so far taken the latest New York Fashion Week by storm.

For example, the Dundas x Revolve show experienced a sold-out collection in lockstep when its pieces sauntered down the catwalk. Luxury stalwarts like Altuzarra, Oscar de la Renta and Rodarte also leveraged the see now, buy now commerce model and included live streams of their shows to increase access and encourage purchases among raving new fans.

What’s in ‘Store’ for Luxury Online

Using real-time engagement features – including live streams of product presentations – Tmall’s Luxury Pavilion of digital shops can connect brands and their customers together to spur more personalized digital shopping experiences. With over 100,000 monthly active users on the Luxury Pavilion accounting for nearly 45% of total spending on the Tmall site, the demand for bridging online and offline luxury retail experiences through DTC marketing tactics is strong.

“Direct-to-consumer principles are creating a lasting impression on luxury brands, and in turn, creating engaged.”


FINAL THOUGHTS

Through the optimization of digital channels, conversation amongst digital communities, and the online democratization of the elusive fashion week, direct-to-consumer principles are creating a lasting impression on luxury brands, and in turn, creating engaged current and future customers.

No matter your model, if you want to gain relentless relevance and digital prowess using DTC marketing tactics, brands need to consider the following questions:

  1. How might we create content that inspires interaction through owned and earned media in the age of mass media consumption?
  2. How and where can we extend and deepen our relationships with customers through community building and authentic engagement?
  3. How might we create more accessible, frictionless customer experiences that spur acquisition and retention?

Prophet is helping companies leverage direct-to-consumer practices around content, community, and commerce to drive growth and redefine industries. If you are interested in learning more about our direct-to-consumer expertise, contact us today.

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Brand Migration in M&A: Seven Factors for Success

Amid record merger activity, companies continue to underestimate the complexity of integrating brands.

Global M&A activities have seen record levels this past year and are expected to grow even further in 2022. With this, Post Merger Integration (PMI) – the bringing together of two organizations, each with its own processes, structure, culture, and management – will be high on many organizations’ strategic agendas.

PMI is profoundly challenging and one of the most cited reasons for M&A failure is poor PMI. It demands massive executive attention and resources, both in terms of financial investments and people.

While most organizations have established robust processes for the integration of IT systems, HR policies, financial reporting and other vital business model elements, brand migration is a frequently underestimated factor in the PMI equation. And the results of this neglect could be devastating. Switching from a familiar brand to a new one is massively disrupting to customers, business partners, employees, and anyone else who has enjoyed positive experiences with a brand bound to be retired and replaced by a new one.

“PMI is profoundly challenging and one of the most cited reasons for M&A failure.”

Over the last three decades, Prophet has supported numerous organizations with post-merger brand integration. From this work, our teams have learned what works and what doesn’t. While every PMI scenario is unique and requires a bespoke approach, we’ve found that there are common ground rules regardless of industry, region, or market dynamics.

Before diving into the factors of successful brand migration, let’s start with a few of the most common mistakes made post-merger. They are:

  • Leaving brand migration to the marketing or comms teams
  • Positioning brand migration as a mere re-naming exercise
  • Waiting on brand migration planning until after deal closing
  • Developing the brand migration plan without detailed customer input
  • Defining a fixed end date for the brand migration without understanding the full range of implications

Make only one of the mistakes above, and brand migration will end in a disaster.

The Most Important Objectives and Key Success Factors

Successful brand migration starts with defining appropriate objectives. On top of company-specific objectives, these three generic brand migration objectives have proven to be very valuable for steering all related activities in the right direction.

Brand migration must:

  • Ensure the facilitation and enablement of the synergies expected from the merger
  • Unlock incremental growth
  • Happen in a way that avoids losing important customers, business partners or employees

After the appropriate objectives are established, it’s time to move forward with the seven key factors for successful brand migration. They are:

1. Prioritize the Brand Topic Early On

Make brand considerations a fixed topic from the beginning to the end of the M&A process, this includes:

  • Using brand fit already as a filter criterion during target screening
  • Understanding employee and customer concerns before moving on
  • Assessing brand equities and the ability to migrate during due diligence

2. Define Objectives and a Roadmap

Develop a brand migration plan early on, during or right after the due diligence. Define and agree on the target picture for the post-integration brand portfolio. Be sure to include that in the letter of intent as well as later in the contract.

3. Connect the PMI Workstreams of Brand Migration with HR and Culture

Marry the PMI’s brand migration project stream to the culture and people stream. Brand migration is nothing short of a business transformation for the acquired organization. Brand and culture are inseparable, and in terms of organizational migration need to be covered in conjunction.

4. Utilize Existing Values

Systematically transfer valuable equities of the brand that will be retired onto the surviving brand to enrich the customer experience. Make the final switch from the old to the new brand only after this has been accomplished.

5. Make the Necessary Investment

Before making the switch from the old to the new brand, invest sufficient time and resources to demonstrate the benefits of brand migration to all employees affected by it. Resolve any concerns they may have so they feel enabled and motivated to tell the migration story.

6. Define the KPIs

Define and track brand migration KPIs throughout the process. Make progression from one phase to the next dependent on hitting pre-defined KPI thresholds (e.g., the awareness level of the continued brand with customers of the to-be retired brand).

7. Go the Distance

Do not stop halfway. Dual branding can be a necessary interim step on the journey to full integration. It is tempting to get stuck with dual branding because it creates the least resistance internally and externally. But rarely is it the most effective long-term solution since it prevents the stronger of the two brands from unfolding its full potential.


FINAL THOUGHTS

Successful brand migration in M&A can have a disproportionate bearing on protecting and creating value for the entire integration. Taking into consideration these seven factors will create a solid foundation for effecting that impact.

Does your M&A approach require a new playbook? Our M&A strategy consultants can help you to drive growth while minimizing risk, get in touch.

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Back to Brick and Mortar: 4 DTC Trends

The right experiences in physical stores help build community and brand loyalty.

If you walk around a trendy neighborhood in any big city these days, you’ll find it sprinkled with stores of DTC heavy-hitters – Parachute, Lunya, AllBirds and the like. Since these success stories made it through digital channels, why is turning to physical retail suddenly the new DTC trend?

Take DTC darling, Warby Parker, as an example. Warby Parker, the prescription glasses and sunglass retailer, came charging into the scene in 2010 and quickly disrupted the category with a digital-only strategy. However, it opened its first physical store in 2013.

One might think Warby’s stores could cannibalize its online sales – with higher overhead – but co-founder Dave Gilboa says that’s not true: “Once we open a store, we see a short-term slowdown in our e-commerce business in that market. But after nine or 12 months, we see e-commerce sales accelerate and grow faster than they had been before the store opened. We’ve seen that pattern in virtually every market.”

In September 2021, Warby Parker went public with a $3 billion valuation and pitched a growth strategy centered around stores (the brand currently has 145 in the U.S. and plans to open more).

How is Brick and Mortar Changing the DTC Ecosystem?

1. High Customer Acquisition Cost

One reason DTC companies go offline is because of rising digital customer acquisition costs (CAC). While acquiring customers through digital marketing was once a cost-effective model, as more retailers (including major brands with big budgets) have upped their digital marketing game, the price of digital advertising has skyrocketed. Over the last five years, CAC has risen by more than 60%, according to ProfitWell.

Believe it or not, even when opening physical stores in expensive and upscale locations like well-known New York City neighborhood SoHo, it’s often more cost-effective for DTC companies to gain customers through high foot traffic locations like these, rather than solely relying on digital marketing acquisition.

In part, this is because DTC companies aren’t opening big-box retail stores. To acquire customers, all they need is a well-designed, curated space. Many, including Casper, Bonobos and Framebridge, have even adopted an inventory-free showroom model.

2. Necessity of Omnichannel to Scale Growth

Many DTC brands reach a point when using an omnichannel strategy becomes necessary for growth. No DTC brand has achieved $1billion in annual revenue without stores. Customers shop through multiple channels, and brands need to meet them where they are. This becomes especially important when DTC companies approach the IPO stage. They need to show investors they can turn a profit, and that’s simply very hard to do exclusively through digital channels.

3. Brand Awareness

Physical footprints are a great way to increase brand awareness, which can boost sales through all channels. MeUndies, for example, partnered with Nordstrom to create a physical footprint. Additionally, some DTC brands, such as Naadam, report that while sales from the stores themselves may not be huge, they saw an increase in digital sales from customers in the markets where physical stores are located. In this way, stores essentially serve as strategically positioned advertisements in areas densely populated with target customers.

4. Using Experience to Build Community and Brand Loyalty

A physical store is also an opportunity to build community and increase brand loyalty. DTC brands can leverage deep customer knowledge acquired through their digital success to design engaging in-person experiences to complement other sales channels.

“Over the last five years, CAC has risen by more than 60%, according to ProfitWell.”

Yoga apparel brand, Alo Yoga, adapted to this DTC trend well. In 2007 the brand started selling ‘street fashion’ yoga apparel and opened its first store in Los Angeles in 2016. At its store location, in addition to browsing Alo’s activewear, customers can take workout classes, grab a coffee and even conduct a business meeting from one of its lounge areas – all in a beautifully designed space, centrally located to where they live, work and play. Alo has since opened a second flagship location in New York City, as well as with smaller locations in California, New York and Texas.

Since opening physical stores, Alo’s growth has accelerated, as demonstrated by:

  • Acquisition of yoga app Cody in 2018 which was rebranded to Alo Moves (on-demand classes)
  • Expansion into the beauty space in 2020 (The Glow System)
  • Inclusion on Fast Company’s “Most Innovative Companies” list in 2021

While they don’t officially disclose revenue, Alo reported it to be around $200 million annually as of 2020.


FINAL THOUGHTS

While many DTC brands achieve initial success through a digital-only strategy, there often comes a point when they need to turn to physical retail to reach the next wave of growth.  The need for in-person experiences is still an important channel for brands and shows no signs of going away.

Want to learn more about partnering with Prophet on driving growth for your DTC brand? Contact us today.

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The Eight Essentials of a Successful Marketing Plan

The best plans aren’t overplanned. They’re living, breathing documents.

This is most certainly our favorite time of year. The heat of summer is over, the kids are back in school and we are graced with the beautiful, bright crisp fall days driving optimism for next year’s outlook.

It is, therefore, that time of year for business planning, forcing us to self-reflect and understand what worked, what did not work, and how we can continually grow and improve ourselves, our teams, and our work to help unlock uncommon growth.

We’ve composed the essentials that are common across successful marketing plans, as well as a few ideas for making the planning process run a bit smoother.

1. Reflection and Introspection

You might think to start your planning with a bit of retrospective from last year. Try and involve as much of the team as you can and also include wider business partners such as product, finance and sales. Run a classic agile retrospective with the three questions:

  1. What worked well last year?
  2. What didn’t go as well last year?
  3. What could we do differently next year?

You can then work with your leaders to filter through and incorporate your findings into the year ahead. Some organizations may even work with a summary of this as the front section of the plan and use it as a chance to share success.

2. Strategy as Your Guiding North Star

We get asked a lot “Is this our marketing strategy or our plan?” The answer is usually both, however, the distinction is important; you cannot have a good marketing plan without a strategy.

Your strategy needs to set your north star. It should be completely aligned to the business strategy and the key pillars for the year (we tend to call them big moves).

Your marketing strategy should therefore layout what marketing needs to do in order to support those moves next year. The plan articulates how you are going to get there, including the specific tactics you will deploy. Underlying the plan will be resources (who) and capability alignment (enablers) to show how you execute the plan. Lastly, you need to provide a budget, identify headcount needs and have a measurement approach. With some organizations, we also find it helpful to do scenario planning—i.e., what we will do anticipating market shifts or if we fall short— or surpass — expectations.

3. Planning for Your Audience

It’s important to anchor your plan in both customers and prospects, on two levels:

  1. Firstly, be clear to address how the businesses’ customers/markets are changing. Identify where specific changes in behavior or needs may impact how your organization thinks about the marketing tactics for the year ahead.
  2. Secondly, understand what key audiences/segments, both within customers and with prospects, will be the focus for the year. These needs must map to your corporate strategy and mission.

This work should help sequence activities based on where the priorities lie, and where the greatest opportunities are to achieve the organization’s marketing goals.

4. A Framework for Planning

One of the things that can slow down marketing planning as well as the integration of the plan with other teams (particularly sales) is language. We tend to find that teams use a multitude of terms for both defining the process and measures of success. There are two areas that are useful to align upon early in the planning process.

Within the process, be super clear on what you mean by the strategy and the plan, and how it all hangs together. The following is an example of how this might appear. Your business will have your own terminology, so it’s important to design a structure that will fit your internal language.

The second part is aligning to the sales funnel. How the different stages of the funnel are defined is critical to driving successful marketing performance.

If you are in the world of B2B marketing, the sales funnel becomes increasingly complex as you plan to align on leads and how they are defined. Make sure to define the process between marketing sales, and when sales accept a lead as qualified.

The planning cycle is a good time to review these with your sales team and see if the handover needs improvement for the coming year.

5. Hitting the Key Points and High Notes

Be pithy. Your marketing plan does not need to be a 250 slide PowerPoint deck; we all know what happens with those! However, it does need to include the following critical components to assure a comprehensive marketing plan is clear, tailored, and impactful.

  1. Plan Summary: Overview of the key objectives, metrics/numbers, and tactics for the year, and the key learning from last year
  2. Business Goals/Strategy: The objectives of the business for next year
  3. Customer Needs: How are we addressing the needs of customers and prospects
  4. Challenge: How marketing will be supporting the business goals
  5. Market: Direct and indirect competitive positioning, moves and SWOT
  6. Actions: 3 – 5 big moves/activities for the year – should be aspirational, inspirational
  7. How/Tactics: Details on how these will work (might break down by areas)
    • Segments and audiences
    • Customer marketing insights
    • Media planning
    • Messaging and content
    • Product marketing
    • Sales enablement
    • Pricing and value
  8. Measurement: How will we measure success through the year
  9.  Our people: Roles, responsibilities, skills, learning
  10. Interactions: How will the team interact and work within other functions
  11. Enablers: What capabilities/vendors/partners do we need to support its success
  12. Consolidated Plan: Detailed Q1 or 90 day – high level subsequent
  13. Budget Allocation

6. Plan, but Don’t Over Plan

We all know things don’t go to plan, and that’s okay! Markets change, competitors don’t stay static, and certainly, customers and prospects don’t always do what we think they will do. It’s what keeps life interesting.

Agility wins when it comes to developing a strong marketing plan. It’s key to plan by quarter, but with varying degrees of detail and anticipate shifts and adjustments along the way. We suggest having a very detailed plan to execute your first quarter, and then focusing on higher-level key objectives and tactics for the subsequent quarters. This will allow you to still plan for resourcing, budget and capacity while remaining flexible to inevitable changes along the way.

7. A Living, Breathing Plan

The easiest way to stay true and on track with goal setting is to break down the goals into smaller, actionable goals and achievements. The same resonates when creating a comprehensive marketing plan for the year. Create a structure for the plan that allows you to run mini-plans. Investing in mini planning in the upfront will further allow for progress, flexibility and little wins to motivate and drive your team’s success.

Create a quarterly and monthly version of your plan. We advocate for a quarterly plan that includes a two-week cycle and starts mid-way through the quarter to outline detailed planning for the next quarter. In addition, it is smart to plan for a monthly review process – just a day or two, during which teams share progress against the plan, and propose any short-term tactical changes necessary. This will help keep your teams on track, avoid over-planning and remain agile while focused on achieving your overall goals.

8. Have Dedicated Air Traffic Control

You should assign one member of your team (or possibly a 2-3-person team) to run the process end-to-end, manage meetings, facilitate working sessions, problem solve and produce the outputs. It can be hard to free up internal resources, especially when a plan needs someone to play multiple project management and cross-functional roles, and many use this as a side of the desk role. However, you ideally want someone as a full-time resource for the strategy and plan. An outside partner can be helpful here and you should resist using your current advertising agency partner to facilitate as this may drive conflict of interest. Day-to-day external partners may, however, be valuable contributors.

Typically, most of these are best in working sessions 2.5 – 3 hours long. The number of these sessions is dependent on the size and complexity of your teams, as well as how much work has already been completed in advance.

“You cannot have a good marketing plan without a strategy.”


FINAL THOUGHTS

Land a plan that will stick. It’s easy to write a plan that sits on the shelf and is ignored. Success is, of course, delivering the numbers and helping your organization grow. A successful marketing plan is one that everyone is aligned to, helps your people work more effectively, and still provides enough room to innovate, be creative and respond to whatever comes your way during the year.

Our Marketing & Sales practice can help you create the ideal marketing plan for your organization. Reach out today!

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Is Your Healthcare Organization’s Content Strategy in Need of a Rapid Response Team?

Our research shows modular, agile content systems can increase engagement and build relevance.

In The 2021 State of Digital Content Report, Altimeter surveyed 375 top content executives at businesses around the world to understand the content challenges their organizations face. What did the research indicate? Companies are feeling the pressure to churn out high-quality, relevant digital content like never before.

While not all companies can keep up with the accelerated pace of content creation, Altimeter found that those that are successful in meeting this demand have implemented an “Agile Content System.”

What is an Agile Content System?

Though all industries failed to hit the mark perfectly on every capability of an Agile Content System, healthcare, specifically life sciences and pharmaceuticals that were surveyed, was found to be the biggest laggard. Due to legal limitations for data use and messaging, healthcare organizations need to manage strict oversight and time-consuming content reviews – making it increasingly difficult to personalize and approve content, decentralize content creation and measure the ROI of marketing investments.

“Real-time publishing is key to producing high-quality, digital content at scale.”

To put it into perspective, one pharmaceutical client told us that it would take their company over 80 days, with 40 handoffs and 12 people involved to get a single email approved. By contrast, a vacuum manufacturer switched from producing vacuum cleaners to ventilators in under a month as soon as COVID-19 hit!

But there is a prescription for improvement. Healthcare organizations can optimize their digital content strategy by leaning into three imperatives.

Imperative 1: Ensure Technology and Workflows Streamline Approval Processes

In an Agile Content Strategy, real-time publishing is key to producing high-quality, digital content at scale. However, this requires that the approval and compliance processes are structured in a way that optimizes fast, efficient publishing – as opposed to slowing it down.

With multiple reviews by multiple stakeholder groups – ethics boards, legal teams and subject matter experts – the entire end-to-end approval process can hold publishing timelines back. While healthcare companies cannot completely do away with these regulatory checks, they can:

  • Invest in better content approval software: Companies are increasingly investing in technology to improve the approval process, with 16% having reported using a dedicated compliance platform (Altimeter, 2021). Software, like Veeva Systems, that streamline the approval process and allow for quicker review, can help standardize and drive efficiency in the overall workflow.
  • Leverage a modular content creation approach: Creating smaller pieces of digital content (e.g., a paragraph of text) that can be sent for faster approval can help content teams accelerate their publishing speed. In addition, it allows bite-sized chunks of content to be combined in different ways based on consumer demographics, which improves audience targeting and personalization.
  • Clearly define content roles: With various content being created across the entire organization, it is important that roles are crystal clear in terms of who is owning what. For example, corporate marketing could own industry-wide content whereas business units could own their sector and/or regional themes, etc. When teams are aligned to their content roles and responsibilities, it makes it easier to create and approve content at a faster pace.

However, healthcare organizations cannot rely on improved technology or modular content alone. To address and improve the root cause of a slow approval process, the industry must move away from an archaic content team structure and toward a more autonomous, decentralized model.

Imperative 2: Restructure Content Teams for Greater Agility

Compared to other industries, healthcare organizations tend to centralize how to create and approve content. This process preserves the brand, ensures compliance and creates consistency across all touchpoints. But it also slows down content development and limits the potential impact content can have on strategic business objectives.

To move forward, healthcare organizations should consider restructuring their content teams to allow for greater agility while still meeting consistency needs. Here are two different strategies to consider based on where decentralization makes the most sense for the business:

  • For organizations that need to focus brand awareness (e.g., showcasing a new brand, launching a product), centralize the content strategy, but decentralize creation: Have a centralized entity develop a unified content strategy, and then allow for brand owners within the organization to execute it. This approach not only creates consistency but also allows for brand owners to create content at a speed that meets their business units’ needs.
  • For organizations that need to generate leads or revenue (e.g., moving into a new market), centralize the content creation, but decentralize strategy: Have a centralized entity continue to create content, but allow for leaders of various departments across the organization to drive the content strategy. This approach ensures that all content meets brand, legal and consistency requirements while empowering individual teams to own the strategy and ensure it ladders up to their established KPIs.

Imperative 3: Set Bolder, Clearer Goals That Go Beyond Brand

While other industries are finding ways to track how their content delivers on clear objectives (e.g., e-commerce conversion or account sales), the majority of healthcare companies (40%) chose brand awareness as their top content strategy goal (Altimeter, 2021).

Although some healthcare organizations have goals that are inherently difficult to track against content initiatives, like patient leads and health outcomes (looking at you, health systems), there are strategies your team can implement to make the most of your content:

  • Invest in more holistic measurement systems: Which overall business objectives could your content goals help advance? Having a clear answer to this question will help facilitate buy-in and investment, even if it’s simply what the content can achieve on its own. Remember that building a holistic measurement system won’t occur in a day. You’ll need to collect data and map out how metrics interact with one another. Then, you’ll be able to attribute the effects of content strategy actions to the business outcomes and outputs. As your organization develops the ability to track and measure more inputs, your measurement system will become more robust, and more useful to guide future content strategy decisions.
  • Create more intentional, measurable goals: If a holistic measurement system is out of reach, set clear, specific goals for content strategy. What does the organization want content to achieve at a strategic, not tactical, level? From a clear content strategy, teams are better prepared to create and measure KPIs that specifically deliver on the strategy. For example, if an organization decides that content should be used as a window into the organization and shows how the organization treats its employees and its policies toward suppliers/vendors, it’s the organization’s team can better measure how content is impacting perceptions of transparency and trust (via internal/external surveys, social listings, etc.).

FINAL THOUGHTS

Content isn’t easy, but with faster content creation systems, decentralized approval and broader content objectives, healthcare can take a leap towards greater agility and relevance. Today’s diagnosis isn’t good — but with the steps above, the prognosis is optimistic.

Ready to revamp your organization’s digital content strategy? Reach out to Prophet today.

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Four Traits of Top-Performing B2B Digital Sellers

Understand the mindset and strategies of the most successful brands. Hint: Teamwork makes all the difference.

In our 2020 State of Digital Selling global research report, we found that top-performing digital sellers have four traits in common: Teamwork, they excel at cross-functional alignment around both strategy and operations; Strategy, from long-term strategy to short-term plans, these sellers align across functions to deliver results; Mindset, Companies that embrace a shift in culture and skillsets earn a competitive advantage; and Customer Focus, top B2B digital sellers use data and cross-functional teaming to deliver what the customer needs. Use our infographic, 4 Traits of Top-Performing B2B Digital Sellers to start conversations in your organization to transform sales.

The Traits of Top Performers

Teamwork

Sounds easy, but the reality is many sales and marketing organizations don’t work well together. Our 2020 State of Digital Selling research found that only 31% of sales reps view marketing as essential to their success. There are also digital cultural barriers: marketing uses analytics and automation at a much higher rate than sales, who focus more on direct relationships with prospects and customers. As digitization of both the sales/marketing funnels and customer experiences increases, handoffs between the two teams become more problematic.

In our research, we found two key gaps between average performers and the top 10% of performers: collaborative customer insight sharing and planning long-term digital strategy. 67% of top performers strongly agree that their marketing, sales, and service teams work well together to provide sellers with real-time data intelligence on prospect activity (vs. only 36% among average performers). As prospects move through the funnel, these teams excel at real-time sharing of new insights, sharing a more complete picture of the customer.  This could be as simple as marketing informing sales that a key account clicked on an ad to target sales’ best next move, to as complicated as knowing a prospect downloaded a white paper, how far they read and which topics they spent the most time reading.

Top sales performers collaborate closely with marketing on long-term technology roadmaps that lay the foundation for shared digital transformation of both internal enablement technology, as well as customer experience. Among top performers, 76% collaborate to put in place a technology roadmap for how digital tools and data will integrate over time, compared to only 38% of average performers.

Strategy

A turning point in strategy collaboration started in 2007 with the introduction of Account-Based Marketing (ABM) and Account-Based Sales (ABS).  Our research has found that B2B sellers who follow these strategies outperform their peers. Sixty-three percent of top performers use well-coordinated teams and unique sales planning with marketing, which persists through ongoing teamwork throughout the funnel (vs 43% of average performers).  We also found 47% of top performers focus on industry vertical, vs. only 27% among average performers.

ABM/ABS is a great starting point, but in this year’s research we’re seeing a trend towards more frequent planning, to the point of “always on” dynamic plans.

Mindset

Companies that embrace a shift in culture and skill sets earn a competitive advantage. A key shift in mindset is needed around trusting data and analytics that form the foundation of sales automation. Sales teams need to develop trust in sales automation and the data that fuels it.

In our research, 63% of top performers strongly agree that sellers embrace the adoption of sales enablement tools, are certified as part of training, and managers are held accountable for tool adoption, vs. only 33% of average performers. Fifty-five percent of top sellers use of tools, AI and data analytics consistently identify best next moves that move forward prospects to conversion (vs. 32% of average performers). There’s a clear gap in mindset among top performers vs. the average.

Customer Focus

Top sales organizations prioritized customer satisfaction above metrics such as sales quota achievement and recognize the link between customer satisfaction and quota. Recognizing and addressing the diversity of buying committees typical in B2B needs is a key success factor, as well as customizing sales approaches by industry vertical. Today’s B2B buyers expect sellers to understand their industry to the point that they become a trusted partner in their own success.

Top performers focus on existing customers over acquisition. For B2B sellers, that means understanding their customer’s industry as a trusted advisor, and that they remain in close contact with both marketing and especially service to guide their sales plan by using those teams’ data insights.  Our research data found this area represents the largest gap between top performers and the average: 73% of top performers say their sales process is defined around the customer journey and informed by rich data analytics (vs. 39% among the average); and 75% of top performers (vs 55% index) said improving customer satisfaction was their top priority.

What You Can Do

For these 4 areas that separate the top 10% of performers vs. the average, consider these tips (and learn more in-depth strategies in our 2020 State of Digital Selling research report):

Teamwork

  • Use Slack or another enterprise social network to better connect team members among sales, marketing and customer success. Use hashtags to share customer success stories; surprising data analytics; and connect to your CRM to share key account information.
  • Create shared digital dashboards with key metrics for each team to illuminate handoffs between teams that need attention and to better understand where your partner teams are focused.

Strategy

  • Form a joint sales and marketing digital transformation working group and steering committee to share baseline capabilities, objectives and to plan a shared digital transformation vision.
  • Ensure alignment between sales and marketing on industry vertical targets, buyer segments and customer journey(s).

Mindset

  • Create a “digital sales champion” program to recognize sellers that have successfully made the digital selling shift. Embed these champions in teams as advocates for digital, especially by sharing specific sales results tied to it.
  • Find opportunities for joint digital skills classes among sales and marketing staff to both build relationships and offer mindset shift guidance. Marketing has gone through this transition, and personal stories of success will help sales teams get ready.

Customer Focus

  • Benchmark your data, that is, assess whether you have the right customer and prospect data to understand and deliver to customers what they need.
  • Make shared customer success metrics (such as Net Promotor Scores) part of compensation incentives among marketing, sales and service. Have customer satisfaction lead sales team objectives.

Please share our infographic with your colleagues to start conversations that can improve your digital transformation of sales.

More Digital Selling Resources

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Digital Selling is a Healthy Investment for Healthcare Companies

With less access to doctors, digital selling is the only choice. That leads to smarter strategies.

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How the Digital Transformation of Sales Could Go Too Far

There are real and costly risks to an overly digitized sales process.

There have been hidden human costs in our drive towards efficiency and productivity using technology. As we approach the post-pandemic period, when businesses will decide which practices to continue and which to wind down, I foresee a rush to digitally transform B2B sales too quickly as harmful to human connections that build trust and long-lasting relationships.

The Cost of Efficiency

When I managed social media at a big bank in the early days of this technology disruption, I needed to understand and exploit its value for financial services. While looking back at the history of technology disruptions in banking, I found a pattern of automation in which to gain efficiencies the industry slowly chipped away at personal connections with their customers. Starting with telebanking, we at least had someone to talk to from home without driving to a branch, automation grew less personal.  ATMs gave customers quick access to basic banking functions, such as making a deposit or cash withdrawal. This culminated in smartphone apps, where many banking functions were accessible from the phone in our pocket.  Each step separated customers further from banks, slowly eroding personal relationships.  Luckily, as a “people-powered” digital platform, social media could address the trust gap.

It’s incredible how wide the gap between customers and businesses has grown.  Here’s an example, as told in Wells Fargo’s blog. After the 1906 San Francisco Great Earthquake and Fire, most of Wells Fargo’s ledgers were in a vault that survived the quake and fires but couldn’t be opened for weeks without exploding. To help the devastated city recover, the bank’s tellers relied on memory and personal relationships to get their customers the cash they needed to survive, let alone start to rebuild. These tellers knew their customers well and were able to disperse money based on their recollections of customer balances and creditworthiness. After recording these transactions in school children’s composition books, they found that these transactions were squared within a few dollars after the bank ledgers were finally retrieved weeks later.

When the financial crisis hit in 2008, many banks that were already established in social media had built trust and better weathered the brand damage that other institutions suffered throughout the industry. They’d built social capital with their customers, which was much needed in the aftermath of the crisis.  While financial services have modernized and scaled through efficiencies that have harmed human connection, the financial services blogs rebuilt trust through stories employees told of how they’d helped their customers succeed and reduced the fear that was palpable then by recounting how the bank had helped their customers survive previous economic catastrophes, thus swinging the pendulum back a bit towards trusted relationships.

As we rush towards the digital transformation of sales, let’s not let the pendulum swing too far. Consider the shift post-pandemic in manufacturing from “just in time” to “just in case” supply chains and our collective desire to emerge from isolation with live events and shopping. We’re wired and ready to connect.

The Right Use of Sales Technology

Sales and customer success teams maintain relationships that can only be built and preserved by people over time. This is particularly true when buying expensive enterprise business products or services.

While conducting research for this year’s upcoming digital selling report, I’ve found a number of approaches that dial back automation in favor of genuine relationship-building.

For example, video meetings exploded during the pandemic as a way to continue face time with customers and prospects while in shut-down.  As more sales reps used video calls, we then saw growth in personalized videos sent via email.  As a consumer, this change was palpable and impactful.  Getting less, “Hi Ed, I thought you might like…” in an annoying automated email, I instead started receiving videos clearly meant for me. In one case, I received a personalized insurance briefing based on a request I’d made, which used my own and my husband’s name, presenting insurance plans that might be best for us and ending with a simple call to action (which I took, I’m now a customer of this broker).

Personalized video messages are a great example of how tech can be used not only to scale but also to build trust in essential long-term relationships.

Maintaining Relationships Post-Pandemic

Sales and customer success team managers know which of their team members have relationships that have grown the bottom line.  These reps need to be supported by digital, but not necessarily by building deep digital skills. A salesperson is much better at reading a customer’s body language, gestures, and so on than any AI I know of.  A data analyst is better at connecting data points to draw valuable insights than most sales reps. We need both of these skills, and that won’t change with the digital transformation of sales in front of us.

“Personalized video messages are a great example of how tech can be used not only to scale but also to build trust in essential long-term relationships.”

To scale and meet the demands of digitally savvy customers, many brands I’ve spoken to have told me that their return on investment in customer experience is diminishing—perhaps a sign that consumers are on to overly automated engagement.  In response, they’re investing in more personable tactics.


FINAL THOUGHTS

B2B businesses I’ve interviewed have built a virtuous circle by leveraging their customers’ digital reach to advocate for them once a trusted relationship is established.  One company I spoke to told me how during shut down, when most communication went digital, they discovered that they didn’t have the permissions needed to reach out on some digital platforms, like email. So, they built customer advisory boards to listen to feedback and build better products, which in turn were amplified by those customers in digital, such as sharing company content with colleagues. Valuable human connections with customers can build a businesses’ reach in digital.

The best digital transformation of selling strategy is one that invests in the digital domain but focuses on bettering the human domain. Tricky, but as the pandemic has demonstrated a realistic and achievable goal.

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