The CMO Command Center

August 28, 2019 Sam Malissa

Customer loyalty in retail is usually framed as a marketing challenge, which means it’s a major headache for the CMO. But what if the CMO were able to effectively recruit help from across the organization?

The customer loyalty challenge is real. When shoppers have Amazon and Google at their fingertips, they’re always just a tap, swipe, or click away from limitless options that are not your brand. 

Some unsettling stats:

  • 75% of purchases are from customers who buy once and don’t come back.
  • 50% of sales are made on promotion, eroding retailer margins.
  • Customer attrition costs the average retailer 25% of its annual revenue.

It’s enough to haunt a CMO’s dreams.

But there are two problems with laying loyalty at the feet of just the CMO: 

First, the way digital marketing has evolved, most CMOs don’t have the tools they need. The typical CMO dashboard focuses on channel performance metrics, like open rates, cost-per-click, clickthrough rates, etc. These metrics are useful, but they don’t track bigger picture issues, like one-time buyers and customer churn. 

And second, customer loyalty is more complex than just marketing. Of course relevant and timely messaging is important, but whether a customer comes back involves a bunch of different factors: the quality of the product itself, the resonance of the product assortment, the fulfillment experience, the human interactions. 

In our work helping retailers, the ones who make the most headway with improving customer loyalty are the ones who recognize the multifaceted nature of the challenge. They’re putting into place command centers that let the CMO take control of customer data, focus on the right questions, and feed the relevant information across the organization so that the appropriate teams can spring into action and help bring customers back for more. 

So what is CMO command center?

1) It’s a single source for customer-centric reporting that ingests raw transactional data and transforms it into prescriptive, actionable tasks across teams.

2) It’s a hub for creating action plans and tracking progress.

3) It’s a system for making relevant data available to appropriate stakeholders.

So, not a physical command center, but a way of organizing data and workflows (although we are hoping that in the future it will involve a swiveling captain’s chair and a giant augmented-reality touchscreen).

Before worrying about email campaign performance, CMOs should be asking: What is our repeat buyer rate? How has it been trending over time? How does it look for different segments of customers? How does it change for different products? 

Having a command center means organizing customer data around these sorts of big-picture questions. It’s a brain instead of a bunch of widgets. 

What if instead of seeing how channels are performing you could easily monitor mission-critical business metrics — like your gross margin goal and how it's tracking by key customer segments; what your customer segments look like in terms of lifecycle; how many customers are you acquiring versus how many are lost; churn prevention rate; early-repeat buyer rate.

CMOs could then provide other teams with key data organized through a customer-focused lens.

This means vision and direction for the merchandise team, which needs to know who they’re buying for. The CMO can give relevant numbers that show which products have resonated with the highest-value segments and in the context of the overall segmentation strategy, providing a holistic view.

It means giving the customer experience team a better view on who the best customers are and why they are coming to the brand, allowing them to create truly differentiated experiences for customers at different stages in their lifecycle both online and in-store. 

It means sharing the projected customer lifetime value of existing customers with the finance team to facilitate a realistic, bottom-up budgeting process. Or helping with more efficient marketing spend allocation by identifying which channels are bringing in the highest lifetime value customers.

By focusing on the right big-picture metrics, the command center gives the CMO a fuller view of high-value customers so they can mobilize the cross-functional SWAT team to address customer loyalty. 



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