9 Marketing and CX Trends to Watch in 2019

I recently joined the Rare Business podcast with author and consultant Adrian Swinscoe to share my take on 9 trends shaping the future of marketing and CX in 2019. In my role at GBH Insights, a leading marketing strategy consultancy, I get to engage with innovative CMOs and top academic minds. Leading up to the interview, I spent some time reflecting about both emerging and continuing trends that are impacting CMOs and other organizational leaders as they look to drive business results and improve the customer experience their companies deliver in the market.

Overall, there are macro trends related to the advances in neuroscience, psychology and economics that give us an improved understanding of how we humans develop preferences and make decisions, added to the continuing advances in data analytics and other technology that allow brands to deliver a more dynamic, personalized and effective CX. With those as a foundation, here are the 9 trends I explored with Adrian at-a-glance, along with high level insights from the team at GBH around each trend.

1. Clicks to Bricks to Clicks

In the retail and direct-to-consumer space, online and offline experiences are rapidly converging as companies evolve to match consumer preferences and needs. Many traditional retailers have struggled to remain relevant with an omnichannel experience (even closing down stores), while smaller, digital-native brands are opening successful brick-and-mortar locations for the first time. We’ll continue to see this trend accelerate in 2019.

Warby Parker’s rocket ship growth is a great example. When Warby Parker founders were still in school at The University of Pennsylvania’s Wharton, they conceived their company, refining their home-try-on program, arguably the key to getting people to purchase glasses online. “Now Wharton professors, venture capitalists, and entrepreneurs are fueling an entire generation of Warby Parkers,” as Tom Foster with Inc recently wrote in a feature.

DTC brands that have transitioned from online-only to brick-and-mortar are succeeding in part because their “born in the cloud” heritage. By connect­­ing directly with consumers online, they have better control of their messages to customers, can gather data about their purchase behavior, to deliver exactly what they want in the moment, while developing an authentic brand. And, by delivering a physical experience, they gain more holistic insights into consumer preferences and behaviors to enhance their online experience as well.

In response to the rising success of digital native DTC brands, many Fortune 500 brands and traditional retailers are making moves to deliver value to specific customer segments and needs. Starbucks’ recent partnership with Uber to deliver coffee to customers is an example. They came up with a specific solution for customers who love Starbucks coffee, but are not always willing to make a trip to a store. By thinking outside the box, they were able to solve an unmet customer need, and do so in a nimble and intuitive way that leveraged Uber’s existing network of drivers.

2. The Changing Role of the CMO

The next trend Adrian and I discussed is the changing role of the CMO, which is becoming increasingly strategic at the Board level in most leading organizations. As Adrian noted, “CMOs today have to become a bit of a superhero, really.” While in the past CMOs often came from a brand, communications or creative background, today’s CMOs are being asked to drive sales and revenue growth, inform differentiated product features and experiences, improve CX and marketing effectiveness though data analytics, all while also leading brand, product and customer marketing. It’s an exciting time to be a CMO, but also a time of high risk as there are very few CMOs who can effectively prioritize every area. So having a broad mindset and building an experienced, capable team around them is becoming more important than ever.

For the CEO, and the CMO, success in the role comes down to understanding what’s needed to transform the organization, taking a customer-obsessed, “outside-in” approach. How do CMOs get the right cross-functional leaders, talent and external partners in place to stay ahead of the curve and drive the most impact? CMOs today play a critical integration role within the c-suite to help bridge product roadmap, technology, data and analytics with an effective and cohesive customer experience that aligns with and enhances the company’s brand position.

3. Building a customer centric and data driven culture a must to survive in the market

Great marketing and CX starts with obsessing over how you can over serve your most valuable customers. Is your company truly an outside-in, customer focused brand? In their latest book, Customer Centricity Playbook, Wharton’s Peter Fader and Sarah Toms explore how companies have found transformational success by focusing on high-value customers and “understanding that not all customers are created equal.” By developing products and services with the current and future needs of a specific set of customers in mind, and aligning your product strategy, marketing and CX around those needs, brands have an opportunity to resonate and grow faster.

4. Turning Voice of the Customer insights into action

Many companies start out with a great strategy, but get caught in analysis paralysis, or fail to turn Voice of the Customer (VoC) feedback into action. Many times, once you ask for feedback, you may be overwhelmed by the response.  Key questions to ask as
you look to improve in this area:

• How does your organization measure and reward the feedback loop across functions?
• Do you have a structured approach to aggregating, summarizing and prioritizing VoC feedback?
• Do you differentially prioritize feedback based on target customer segment and customer lifetime value?
• What’s the specific process for the teams to apply customer feedback? How do you measure success?

At the end of the day, action is more important than precision, so long as the company is making progress toward its ultimate brand aspiration. The key is to continually make changes to improve CX, while measuring the impact with customers. And fail fast – if you get it wrong, learn quickly and adjust again. 

5. Understanding the customer journey through real time data and analytics

Knowing how to effectively leverage customer data and analytics is the #1 success factor for CMOs today. The customer “funnel” and “sales pipeline” are concepts from a bygone era.  Today’s dynamic customer journeys are constantly evolving, and to be successful, brands not only need to understand, but anticipate customers’ needs in the moment.

By applying research, data and analytics, GBH helps CMOs and brands to develop products and experiences to deliver on customer needs in the moment, while also identifying unmet or underserved needs to drive future growth.

In my experience, having worked at a number of data-driven organizations including Microsoft, T-Mobile and others, there are a few common mistakes that companies make. One is an over reliance on data alone to drive many marketing and product strategy decisions. In other cases, I’ve seen marketing teams dismiss available data simply because it may not be complete. In both cases, the right path forward has come down to balancing both the available data and direct feedback from customers – as well indirect feedback from employees and partners. In other words, even the best data need a human filter. While real-time data and analytics may be a stretch for many organizations, successful brands are increasingly adopting internal and external sensing capabilities to keep abreast of their customers’ – and competitors’ – evolving behaviors.

6. Personalization starts with micro-segmentation, and tapping into the right data

While most brands have already moved to a data-based product personalization and CX, the reality is many companies struggle to effectively scale customized experiences or 1:1 marketing. While segmentation remains critical for upstream strategy (eg, brand positioning, persona development, product feature prioritization, etc.), broad segmentation for outbound marketing execution is yesterday’s game. Increasingly marketers are moving to microsegmentation to deliver a more engaging and effective customer journey.

But, successfully implementing this approach requires and different skills and thinking.  In addition to qualitative research that helps clients gain a more holistic understanding of their customers and core motivations, GBH digs deeper with industry-leading quantitative research and advanced data analytics methodologies.

7. Balancing personalization vs. data privacy

2018 was riddled with examples of brands that were not as transparent about how they use sensitive customer data. Many companies are collecting data for data’s sake, rather than taking a lean approach to data. My partner, Professor Eric Bradlow, chair of the Marketing department at Wharton, often advises leaders to focus on “better data, not big data.”  This is a conversation that’s happening more and more at the CMO and board level.

Key questions CMOs need to ask: how can we minimize the amount of data our company collects? What data are truly needed to improve CX and CLV (Customer Lifetime Value) over time? What value are we delivering customers in exchange for any personal data? By asking the right questions to rationalize which data are truly needed to execute the brand’s strategy, CMOs and their teams can land the right strategy that delivers CLV, differentiation and growth – while maintaining customer trust.

8. Investing in Technology Now the Leading Factor in Delivering Great CX

The rise of AI, machine learning and other emerging technologies that promise a more personal and human experience is perhaps the biggest macro trend in tech right now. Amazon, Apple, Google, Microsoft and other tech giants are working to create the conversational UI of the future with smart companions like Alexa, Google Home and Siri (in addition to the rapid growth of AR, VR, IoT and other smart displays). One of the biggest differentiating factors for brands in the future will be those who invest in technology to create better and more seamless experiences for their customers – without the constraints of needing a smartphone or web browser in their hand 24/7.

Companies who think outside the box to leverage tech in new ways – that reinforces their brand position and product strategy – will be set up for success.  But, also beware: brands should not adopt new technology just for its own sake, which could result in a “frankenstein” approach of different teams investing in different point solutions that create a broken (and expensive!) customer experience. As people’s relationship with technology continues to evolve, marketers and CX professionals have an opportunity to deliver better marketing and experiences in the moment by using real time data and AI to learn and experiment at scale.  A key is to better understand and keep a pulse on the needs and changing behaviors of the brand’s target customers – not all customers.

That said, it’s important to not overstate the current role of AI. It’s still very nascent for most organizations. Mat Velloso, a senior technical advisor at Microsoft recently tweeted, “If you see something written in Python, it’s probably machine learning. If you see something written in Powerpoint, it’s probably AI”. That’s a very true statement in 2019 – as we think about AI’s current level of maturity.

9. B2B companies increasingly adopting B2C best practices

To date, B2B and B2C marketing strategies have largely been separate domains. I’ve been lucky enough to spend about half of my career in B2C, and the other half in B2B (with a lot of overlap in between) and have come to appreciate how much these marketers can learn from each other.

In the past, there was a misperception that customers put on a completely focused practical, rational “ROI” hat when they make business purchasing decisions. When in fact, research and experience demonstrate they act much more like traditional consumers when making these decisions, with emotional factors playing a key role. In line with this, B2B companies are increasingly understanding the imperative role of an effective brand strategy, crafting a cohesive company narrative, and shifting their approach to create more individualized and compelling product and brand experiences that balance rational and emotional considerations.

Looking forward

The 9 marketing and CX trends above represent some of the most discussed topics with our clients, fellow marketers and CMOs, and will continue to rapidly evolve this year.

As a final take away from my podcast with Adrian, he asked me what advice would I offer individual marketers or leaders as they look to improve CX. For me, I think it starts with asking yourself a gut check question: Do you truly know who your target customer is, and do you feel confident you can understand and try to live a day in their shoes? If so, how are you helping your organization to prioritize in the right areas to best serve that customer?  If not, you’ve got some work to do, and we at GBH would love to help you!