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Working Three http://workingthree.com Digital Innovation + Customer Experience Fri, 17 Jul 2015 06:05:47 +0000 en-US hourly 1 5 disruptive forces happening right now http://workingthree.com/uncategorized/5-disruptive-forces-happening-right-now/ http://workingthree.com/uncategorized/5-disruptive-forces-happening-right-now/#comments Thu, 16 Jul 2015 00:33:28 +0000 http://workingthree.com/?p=5821 Recently I was asked to predict what forces, industries or businesses would be causing the most business disruption. While it is… Read More

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Recently I was asked to predict what forces, industries or businesses would be causing the most business disruption. While it is is hard to really predict what the next big disruption will look like it is possible to see forces at play right now that are going to have a major impact on the way businesses are run.  

 

1 – VRM – When your data becomes your data

What is happening with the vast amounts of data we are creating on a daily basis? The average person has bank cards, credit cards, social media accounts, loyalty cards, and smart phones all of which can create a detailed picture of that person – a picture that should be able to make our lives better.

Imagine a world where all of your data was in one place and it was used to help you. Arrive in hospital with a fever and the doctors could instantly see every place you have been, everything you have eaten and every person you have interacted with. Not only could they diagnose you quickly and accurately but they may be able to stop a pandemic before it started.

Currently companies view the data they have about you as their property. And this means that all the data you create can’t work together effectively. There is a new type of technology company emerging that is addressing this issue. It is being loosely tied together by the term VRM, which stands for Vendor Relationship Management – the opposite of CRM. VRM technologies work on the principle that all the data a consumer creates is far more valuable if it is held in one spot, and that spot should be controlled by the consumer that created. It has taken a while to arrive at this point, but the world is now poised for a massive leap forward and many of the companies playing in this space will be the ones leading the charge.

 2 – Software writing software – Artificial Intelligence starts to automate the knowledge economy

The different disciplines within the field of Artificial Intelligence (including Machine Learning where software adapts to new situations and recognises patterns, and Automated Reasoning where software uses stored knowledge to draw conclusions) are quickly maturing and evolving. In the very near future these systems will be able to write software programs of their own, and that will enable them to evolve to a point where they can take on many of today’s ‘knowledge’ based jobs.

Research conducted by Oxford University suggests that 45% of all current jobs will be automated in the next 15 – 20 years. This will include professions like medicine, marketing, finance, software development and many others. That same research also suggests that it is very unlikely that the creation of new jobs will match the erosion of old jobs.

What will people do with all of this new spare time they have on their hands? What will happen to the world when so many jobs that comprise repetitive tasks are able to be automated? How will business evolve when it takes far less human and financial capital to meet the needs of their markets and customers?

Based on our experience of the last decade, as receptive tasks become automated more time can be spent on creative jobs. We can expect the pace of innovation to explode and whole new industries to be developed.

3 – Data utilisation – When data stops being about analytics and becomes the product

Over the next two to four years companies will start to really examine the massive volumes of data they have been storing over the last decade or so. Currently the tools for data storage and analysis (commonly grouped together within the term ‘big-data’) are becoming far cheaper and more commonplace. As companies get more comfortable with viewing the insights that come from massive data sets the next stage in data utilisation will pick up steam.

The data that organisations are storing about their customers and networks is currently being used to develop customer insights. It will soon move to becoming the raw material for generating  revenue. This doesn’t mean such organisations be selling the data, as this would degrade its value almost immediately. Instead companies will design new products and services that allow their customers to make use of the data they have created.

The banking and finance industry is an example of an industry that is already well down this pathway. Insurance companies can now use data to provide a more tailored package. Track your driving behaviour and auto insurers can offer you a package that suits your exact risk profile. Health insurers can now offer incentives for healthier behaviours tracked through mobile phones and fitness trackers like FitBit. It’s not a great leap to expect a banking app that helps you stick to a budget by helping you make better financial decisions in real time.

Expect the next generation of digital experiences that brands offer up to their customers to be come much, much smarter.

 4 – The ‘all in’ digital company – new business models that will eat the world

In February 2015 Gartner published the results of survey that analysed the effects of the ‘connect Economy’. The survey showed that 89% of the companies surveyed by Gartner believe that customer experience will be their primary basis for competition by 2016.

Although many companies have been slow to adapt to the changing environment, the period of being ‘nervously immobile’ has come to and end. There are a number of companies which are already going ‘all in’ – integrating the customer experience through scalable, digital solutions.

The pace of change is making many business leaders nervous that they will be unable to  keep up. But the more courageous companies are reforming their companies to make the most of new opportunities. These companies are doing more than just replacing one form of marketing with digital techniques. They are looking for completely new ways of interacting with their customers, and developing new business models in the process.

The first wave of ‘digital disruption’ was owned by the silicon valley startup. The next wave may well be owned by big brands who start acting more like venture capitalists than monolithic organisations looking for investments within their market.  

5 – Chief Digital Officers – The role that is changing every aspect of business

The digital revolution is already generating ‘internal disruption’ within many firms and will soon produce organisational change. It will take the shape of a new senior management position with an entirely new role and dedicated resources.. That person will be the Chief Digital Officer (CDO).

Last year Forrester research told us that 39% of CEOs believe that they personally set digital strategy for their firms, but only 26% of their direct reports from within the executive team believe that is so( that their CEO actually does own digital strategy). With the ever increasing importance of digital in everyone’s lives it is clear that many organisations will require someone at the senior management level to lead the charge on digital.

It is possible that the current CIO or CMO roles evolve into the CDO. But it is equally likely that this will not happen.  Companies are rapidly shifting away from maintaining operational systems to implementing the digital capabilities that attract, convert, serve, and retain customers. This suggests that the role of CDO will need to have influence over marketing, technology, strategy, customer insights and product development. In short they will be at the pointy end of total business transformation.

Written by: Mark Cameron CEO

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The 3 foundations for digital strategy success http://workingthree.com/blog/3-foundations-for-digital-strategy-success/ http://workingthree.com/blog/3-foundations-for-digital-strategy-success/#comments Fri, 10 Jul 2015 06:59:51 +0000 http://workingthree.com/?p=5812 Gatorade’s digital ‘mission control’ at its Chicago headquarters. Developing such a centralised view of analytics across the business creates dialogue… Read More

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Gatorade’s digital ‘mission control’ at its Chicago headquarters. Developing such a centralised view of analytics across the business creates dialogue and collaboration, according to Mark Cameron.

Delivering quality digital experiences is challenging. Investing in customer insights and feedback is just the starting point. To ensure success there needs to be a balance between engaging your customers and delivering tangible results.

A recent Forrester study called ‘Mind the Gap’ discovered that one of the biggest challenges facing businesses in realising their digital strategy aspirations are the “…huge political battles between IT organisations and businesses”.

If this sounds familiar, and I assure you it’s common, then it’s worth exploring ways to minimise the risk of implementing a digital strategy. In our experience at Working Three, digital strategy success is driven by three key principles: leadership to create alignment; the use of analytics and sharing of information; and creating a customer-obsessed culture.

 

LEADERSHIP TO CREATE ALIGNMENT

Sales and marketing teams are not getting what they need from their organisations’ IT departments, so they’re going elsewhere to find it – hiring their own technical specialists and creating their own units. This creates inefficiencies and political infighting.

Leadership to address this challenge means welding these units back into a unified whole. Developing KPIs that show each unit how it impacts the customer experience helps to quickly create alignment. Making the customer metrics transparent and visible across the organisation will help start conversations and team-work.

Spend time finding out where disconnects are happening. Our organisation has consulted with many companies which have allowed disconnects between marketing and IT teams to develop unchecked. This creates an adversarial culture which is at odds with delivering an outstanding customer experience.

It is much better to deal with communication issues and frictions as they arise rather than trying to re-engineer a broken model at a later date.

 

USE ANALYTICS AND SHARE THE INSIGHTS AND INFORMATION

The delivery of a digital initiative is not an end point in the digital strategy process, it’s a waypoint in a journey of continual improvement.

Developing a centralised view of analytics across the business creates dialogue and collaboration. The sports drink brand Gatorade famously pioneered the NASA style “Mission Control” analytics suite as part of a digital transformation project. According to its then senior marketing director Carla Hassan, Gatorade aimed to “take the largest sports brand in the world and turn it into largest participatory brand in the world.”

We recommend that those directly involved in digital initiatives – marketing, customer service and IT units – share analytics and insights. But we go a step further. We urge our clients to create a set of shared customer experience dashboards. We call this process the creation of the ‘customer command centre’. It is best practice for everyone to see how any and all digital activities impact the overall customer experience.

 

DEVELOP A ‘CUSTOMER-OBSESSED’ CULTURE

This doesn’t need to be a complex process. Training and consulting advice will help. The key element in achieving this culture is for the organisation to be constantly asking itself “How will this impact our customers?” That simple question, asked over and over, will focus everyone on why most digital strategies have been developed in the first place – to create outstanding customer experiences that deliver a sustainable competitive advantage.

The most notable example of a customer-obsessed company is Amazon. In fact the first ‘Leadership Principle’ it lists on its corporate website is ‘customer obsession’. The site goes on to say “Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers.”

So if your organisation is struggling to see a measurable return from a digital strategy, by all means examine the technical and communications resources and ensure you have the right skills in place. But ultimately success will come from leadership which aligns resources, the sharing of quality analytics and a culture that is relentlessly focused on the impact of every initiative on your customers.

Mark Cameron is a founder of digital innovation and customer experience consultancy Working Three…

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Reconciling customer experience with advertising http://workingthree.com/blog/reconciling-customer-experience-advertising/ http://workingthree.com/blog/reconciling-customer-experience-advertising/#comments Tue, 03 Feb 2015 03:27:14 +0000 http://workingthree.com/?p=5801 Life is not easy for a marketer. The media landscape continues to be reinvented and fragmented, affecting their ability to… Read More

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Life is not easy for a marketer. The media landscape continues to be reinvented and fragmented, affecting their ability to capture the attention of their target audience. Mass media’s power is also rapidly waning, and so attention is turning to digital innovation and data-driven direct communications.

But, as many brands have found out, relying too heavily on technology can turn your advertising campaigns into nothing more than smart spam – with an ever-decreasing return on investment.

To further complicate matters, research data shows word-of-mouth recommendations are now disproportionately influential in the purchase design-making process, especially those from friends and family. The Global Trust in Advertising and Brand Messaging report published by Nielsen in late 2013 found 84 per cent of global respondents saw this source of information as the most trustworthy.

Put simply, consumers are becoming harder to reach, and gaining their trust is becoming much more difficult even if you do reach them.

To manage this challenge, organisations and marketers have been looking to better understand the entire customer journey to enhance the customer experience. But this approach comes with an inherent conflict best summed by the following question: “Do you want your customers talking about your products, or your advertising?”

It is true, advertising provides a direct line of communication to existing and prospective customers. A customer experience advocate, on the other hand, will ask: “Why not let the customer experience speak for itself?”

So how should brands think about this issue?

Selling experience

There is a lot to be said for taking a long hard look at your customers and your organisation to identify opportunities to greatly improve the customer experience. In today’s world, almost every consumer-facing company should be doing that in some way. Customers’ ability to be heard en masse is far too powerful not to.

And inevitability, when companies do seek to improve their customer experience, many of the outcomes become innovations and new digital communication channels.

But should these replace the need for advertising? Not at all. What they often do, however, is reframe the question: “What are we advertising?”. After all, if your company has invested heavily in creating a great customer experience, shouldn’t you tell the world?

Take Medibank, for example. The organisation sells health insurance, but its current advertising campaign is focused on raising awareness for its GymBetter mobile app. This app allows the user to pay to use a gym without having to pay regular membership fees. It’s not Medibank’s core business, but it is brand aligned and delivers great experience, and it gets even better if you happen to be a Medibank customer.

Market trends are maturing in a way that will start to impact how brands interact with their customers. The way consumers understand and use their own data is creating a whole generation with very different expectations about the way companies should interact with them. Social media is now reaching ubiquity, but there are still significant jumps in online communication that will be made in the next few years. Technologies like 3D printing will also dramatically alter traditional value chains.

These near-term trends will bring further rapid change and cannot be ignored. Nor can businesses advertise their way around them.

Creating a unique and fantastic customer experience is the way for businesses to stand out. But how the consumer interacts with the product or service – or how they discover that product or service for that matter – is part of the overall experience. Deeply integrating advertising into the way a customer experiences a brand is becoming an essential aspect of the overall marketing mix.

Do we want people talking about the product or the advertising? Neither. We want people talking about an outstanding customer experience, of which both are a part.

 

Written by: Mark Cameron CEO

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Discussion with Catherine Heath From Huge Inc. http://workingthree.com/blog/discussion-catherine-heath-huge-inc/ http://workingthree.com/blog/discussion-catherine-heath-huge-inc/#comments Thu, 13 Nov 2014 05:43:30 +0000 http://workingthree.com/?p=5762 In late August this year Melbourne’s digital elite assembled at the city’s public library. The event was the Australian Interactive Media… Read More

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In late August this year Melbourne’s digital elite assembled at the city’s public library. The event was the Australian Interactive Media Industry Association’s V21 conference, and this year’s line up promised to be the biggest event yet.

One of the key draw cards was Catherine Heath, the Head of Strategy & Planning, US West Coast, for the digital agency Huge. Among digital agencies Huge, a member of the Interpublic Group of Companies, is one of the standouts on the world stage. Its renown owes much to recent Initiatives such as the development of the HBO GO platform, the “TV anytime experience for HBO subscribers”, the new website for the phenomenon that is TED, and the new immersive cross platform digital experience for one of the most beloved multi generational entertainment series: The Simpsons.

“The best way to sum it up is they are setting expectations on UX/UI, not following them.”

A couple of weeks after the Melbourne event Catherine and I shared a telephone call while she was in between meetings in Singapore. We spoke for some time about: what it was like to work in a company like Huge (by all accounts being surrounded by hundreds of very talented digital designers, technologists & strategists is pretty fun most of the time); what the youth of today were doing with digital technologies (the best way to sum it up is they are setting expectations on UX/UI, not following them); and where the world of digital marketing and branding was heading (digital is quickly becoming the lead player in the overall marketing mix, meaning other forms of marketing are having to support the digital strategy, a complete turn around of events).

The conversation then moved onto what companies have to do really become leaders in the digital space, a topic dear to my heart.

In the initial years of the digital marketing revolution the people with the power were the tech-heads.

Catherine doesn’t describe herself as a “techie”. She comes from a brand strategy background. But that is what’s now needed to provide meaningful insights in the field of digital communications. In the initial years of the digital marketing revolution the people with the power were the tech-heads. And they still are an inherently important, though its what surrounds them now with cross functional agencies that makes what they do really interesting on a broader scale.

For someone deft at writing code the logical side of their brain is the area that gets exercised most frequently. As a result conversations with talented technologists can become black and white, on or off. This is great when it comes to designing software, but it does not produce an engaged conversation with a business leader who is looking to transform his business.

And on reflection that was the interesting aspect of the conversation with Catherine. I don’t think we talked about technology trends once. Data was only mentioned very briefly. The majority of what we discussed was about how digital thinking was now shaping the value around brands and the impact that would likely have in years to come.

“Life first thinking is imperative in a world where digital is omnipresent, digital is no longer a channel or a medium – its simply a way of life”.

We discussed what it meant for a business to go “all in” to digital. That included the effort required from clients, and in particular the courage that leadership needed to transform a company to face the challenges of today’s ‘digital first’ world. “its not about digital ideas, rather ideas for a digital world” as she says. “life first thinking is imperative in a world where digital is omnipresent, digital is no longer a channel or a medium – its simply a way of life”.

Huge is fortunate to have Catherine working for them. She is intellectually curious and very bright. And she leaves you with no doubt that the digital transformation that has been happening in world of branding, marketing and communications has really only just started.

There is a new wave of customer relationships and connections being invented right now – and she is in the middle of it.

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The next issue for CMOs to deal with is on the doorstep http://workingthree.com/blog/next-issue-cmos-deal-doorstep/ http://workingthree.com/blog/next-issue-cmos-deal-doorstep/#comments Thu, 13 Nov 2014 05:39:23 +0000 http://workingthree.com/?p=5760 The marketing industry has completely reinvented itself over the last few years. In fact it is difficult to think of… Read More

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The marketing industry has completely reinvented itself over the last few years. In fact it is difficult to think of an industry that has had to deal with so much change as marketing and advertising. But while many marketers may feel like they are finally getting on top of the technology and data needed to hit their targets, the truth is the marketing space is still being disrupted – driven by changes in consumer behaviour, as it has always been.

The difference this time was the influence of a relatively mature internet and the way consumers chose to use it.

Major financial meltdowns and recessions force businesses to evaluate their spend on marketing and branding. As revenue and profitability become squeezed marketers are pressured to improve return on marketing investments. The recent Global Financial Crisis was no exception. The difference this time was the influence of a relatively mature internet and the way consumers chose to use it.

As consumers completely altered their media consumption patterns marketing budgets began to focus increasingly on optimising consumers digital buying journey. This meant big investments in data driven awareness marketing such as search marketing, driven by Google, and social media ad placements led by Facebook.

More recently, as businesses have become more comfortable with data driven targeting, major investment have been made into cloud-based Customer Relationship Management database solutions such as Salesforce, and Marketing Automation platforms to complement and integrate the awareness efforts. This – seems like a natural next step – collect as much data as you can about your customers, find out what makes them tick, use that information to send out highly targeted and personalised marketing messages.

However many marketers are now realise that this form of data driven marketing can become nothing more than a pathway to delivering very smart spam to existing and potential customers, a surefire way of undermining value in the one thing they are meant to be protecting – the brand.

So CMOs and marketing professionals are refocusing on the customer – who has always held the balance of power.  Having data is no longer enough. Marketers need to create a compelling customer experience, one that will integrate all of the digital initiatives around their company’s core brand values. And as they go through this process the focus changes from “collect all the customer data we can” to “what data will help our customers experience our brand?”

Of course companies like Nike realised this some time ago which is why they built the Nike+ platform. Their brand is not about selling shoes. Its about performance.

This is where the next big challenge for many marketers lies.  And this is because it’s highly likely that the data that will help customers experience their brand may not exist yet, or if it does it needs viewing with a very different lens. Of course companies like Nike realised this some time ago which is why they built the Nike+ platform. Their brand is not about selling shoes. Its about performance. And the Nike+ platform helps their customers track and improve their performance. The information Nike gets about who is using their products and why is almost a happy byproduct.

The biggest issue is developing the strategic clarity to know what to do.

Not many brands have the type of marketing budgets that Nike does. But the size spend is not really the issue. Much of the technology is now relatively cheap, and continually falling in price. The biggest issue is developing the strategic clarity to know what to do.

So the CMO of today now has to be part data scientist, part creative technologist and part innovation strategist. Because creating and growing a market is now more difficult, and critical, than it has ever been. The stakes are high. But it is for this very reason that many of the CMOs of today will be the CEOs of tomorrow.

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AIMIA Retail Research Report – Australian retailers fight back http://workingthree.com/blog/aimia-retail-research-report-australian-retailers-fight-back/ http://workingthree.com/blog/aimia-retail-research-report-australian-retailers-fight-back/#comments Thu, 13 Nov 2014 05:33:58 +0000 http://workingthree.com/?p=5756 It’s safe to say that the pace at which Australian consumers have adopted shopping online has taken some retailers by… Read More

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It’s safe to say that the pace at which Australian consumers have adopted shopping online has taken some retailers by surprise. While many may have seen the writing on the wall during the years following the Global Financial Crisis, a turning point in online trade, some of the more traditional retailers were slow to accept the inevitable – and even slower to invest.

The Australian retail marketplace would be, and still is, going through a digital transformation.

This is particularly true in Australia which seemed somewhat shielded from the financial crisis sweeping the world – why invest in digital innovation when the local economy seemed to be so robust? Fast forward to today, where we can look back with the benefit of hindsight, and it now seems obvious how the market was going to change. Innovation overseas would bring new waves of competition and the data driven marketing techniques that were reshaping the communications and media industries would forever alter the way that retailers connected with their customers. The Australian retail marketplace would be, and still is, going through a digital transformation.

For the last six years The Australian Interactive Media Industry Association [AIMIA] in partnership with Australian Centre for Retail Studies at Monash University, have been asking Australia’s retail professionals how they see this changing landscape. The report, of which I am this year’s Chairman, combines qualitative interviews and a quantitative survey to deliver deep insights into the state of Australia’s digital retail landscape. The 2014 release of the research report, downloadable here, reveals some of the clearest insights thus far.

It’s not omnichannel, it’s just retail

One of the strongest sentiments to come out of the report this year was the negative perception of some of the language that permeates the digital marketing space and the term omnichannel in particular. One retailer was anonymously quoted as saying “Omnichannel is just another term, it’s consumer expectations that have become omni if anything … Now customers expect to be able to research on their mobile, maybe even buy on the device, or at least then go to the store the next day and look at the product. There is an expectation for how retailers deliver on these channels, that is what is important – we need to to take commercial advantage of these expectations.”

Spending time to get the strategy right, and having clarity about what each channel was to be used for, is essential in creating optimal cross-channel experiences.

Overall most retailers agreed that there was no “one size fits all” approach to retail promotion across so many digital and non-digital channels. Spending time to get the strategy right, and having clarity about what each channel was to be used for, is essential in creating optimal cross-channel experiences.

Think less about the channel and more about the experience

One critical evolution in tone that came through clearly in this year’s report was the role that digital tools and techniques play in developing a customer-focused business and leading changes in customer engagement. While no one respondent claimed to have all the answers, many were looking for ways to constantly improve.

A constant focus on the customer experience combined with the strategic use of customer data was seen as central to creating a sustained competitive advantage. Naturally, taking this approach across so many channels raises concerns around complexity. As such marketing automation was seen as the only scalable way to manage the levels of customer engagement initiatives that many firms sought to achieve.

Digital strategic importance is growing rapidly

Compared to when the AIMIA report was published in 2011 digital is now seen as “business as usual. It has become integrated part of normal business operations. And this clarity has seen it’s strategic importance grow quickly over the last 12 months. Another anonymous interviewee said “Because of the rapid growth of our [online and digital] performance we are making a material difference to our company’s overall year on year sales growth. So we’re not 50 percent of the business but contribution sales growth is significantly more than our sales as a percentage of the overall sales. For that reason we’re getting growing visibility because we’re basically helping the company grow quicker than it would otherwise… It’s about the customer, giving them great customer service and offering different service to a regular store. With digital we can provide more and more value added services, where a few years ago it might just be store locations and opening hours, now it’s personalised specials using data, just to actually help people shop and save money.”

Australian retailer are in a mature digital landscape

While e-commerce itself may still only make up a small percentage of overall sales for many retailers, the digital landscape touches every aspect of the retail marketing and branding journey. It would seem that Australia retailers are now fighting back against overseas competition by adopting digital marketing techniques and looking for new way of thinking through long term strategy, with customer experience and data and the centre.

The AIMIA Retail Research Report was conducted with many of Australia’s leading retailers and was focused on gaining insights from decision makers in the areas of e-commerce and digital marketing. The report is available for download here.

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