Identity busting, marketing simulation, and team engagement shaped our discussions during our 6th CMOs Leading Innovation Conference (CLIC 22) in Charleston, South Carolina.
Why it matters to you: Three weeks into the year, CEOs and CFOs have already asked our clients to revise (and sometimes pare) their 2023 budgets. Growth officers and CMOs have started scenario planning.
This collaborative, cross-functional planning process requires us to explore new growth strategies. Those strategies should fulfill three guiding principles: they must boost the bottom line, align with our core values, and drive predictable 2023 results.*
And unlike the halcyon days of free money (which can cover up lots of bad behaviors and resource inefficiency), 2023 is different.
We cannot succeed with lazy priority-setting approaches and old planning methods. They will exhaust our well-intended teams, kill our brand, and upset key customers.
We exchanged innovative marketing and team engagement strategies at CLIC ’22 that fulfill those guiding principles. I was blown away by the ideas our cohort generated, and the level of candor regarding their professional and economic headwinds.
In the spirit of confidentiality and Chatham House Rule, we kept most company examples anonymous. Some clients agreed to be featured.
Here’s what we learned:
1. Questioning your identity creates breakthroughs.
During our fireside chat with Sandboxx CMO Shane McCarthy, which was detailed in a previous post, we explored how customers and the pandemic have triggered existential conversations. Sandboxx offers a platform that helps service members and their supporters throughout their military journey via content and products.
In 2021, McCarthy and his team noticed the primary Letters product was reaching maturity. The Sandboxx team began experimenting with a blog, then a video series containing paid ads from the military ecosystem. The video series offers a unique channel where brands can tell their honest, high-impact stories to service members. Before long, Sandboxx attracted Fortune 100 advertisers, 150,000 YouTube subscribers and 5 million monthly impressions.
According to McCarthy, “Our conscious shift from a one-product Sandboxx Letters company to a media platform was instrumental in Sandboxx’s 500% growth in valuation over the past four years. It is also fueling several new product ideas.”
2. Budget obsession undermines growth.
During these precarious times, it’s tempting to obsess over boosting the balance sheet and throw aside our values. In fact, many of marketers say they are following Google’s ambition to become 20% more efficient. The Wall Street Journal broke this story in September.
Here’s the downside: an obsession with efficiency leaves companies vulnerable to competitors who are laser-focused on customer and brand boosting. CMOs may be losing critical budget to analyze new customer segments, launch powerful competitive strategies, and fortify customer retention strategies.
Our cohort agreed. One CFO client asked every executive leader to cut at least $1M in expenses. Here’s the challenge: the company’s market cap is one- tenth of their nearest competitors. And the company sometimes struggles to differentiate itself in a crowded marketplace. Cutting their way to growth to satisfy investors is a flawed option.
Over the ensuing weeks, the CMO convinced the CFO to increase the marketing budget. Funds were used to dramatically improve the company’s ecommerce platform, sales operations, and account-based marketing programs—with a goal to contribute at least 25% of company revenues in 2023.
The CMO did something strategic: he picked only three areas to drive growth. I predict they will perform well this year.
3. Traditional segmentation strategies are obsolete.
For many years, creating sophisticated customer journey maps and customer experience (CX) teams were treated as segmentation table stakes. Things are different now. Customers often prefer making buying decisions with minimal help from salespeople or business developers (aka SDRs, BDRs, etc.). They can change brand loyalty on a dime, and they expect value and speed at most touch points.
Customer journey maps and traditional marketing research struggle to keep up with these changes. Well-polished customer journey maps and multi-year CX plans become obsolete within a flash.
[This is not just my opinion. ValueGraphics’ team analyzed hundreds of thousands of surveys and just published details in The Death of Demographics. We discuss this further on February 3 with David Allison. Details here.]
At CLIC ’22, the Chief Digital Officer (CDO) of a large nonprofit shared how her organization is adapting to these new customer and membership realities.
For example, the number of daily active unique consumers jumped from 120,000 to 800,000 between 2020 and 2022. The percentage of ecommerce users more than doubled.
In response to these changing online customer behaviors, and a desire to find new customer audiences, the CDO’s team learned how to conduct 800 concurrent low-cost email experiments. The team used these experiments to test campaign ROI.
The CDO shared: “Why wait 12-18 months for the member to renew? Rapid experiments and simulations with actual customer data can help us decisively predict the value our consumers want to receive, their preferred channels, and how quickly they want value delivered.”
4. CX without EX delivers much lower ROI. (that’s a mouthful! But stay with me…)
In private CLIC ‘22 breakouts, we heard conversations around the costly attrition of top people, priority overload, and team burnout reaching all-time highs. Today, top brands are leaning on CMOs to restore cultures to health using their strong communications and change leadership toolkit. And the numbers are beginning to show that CX, marketing, and Employee Experience can form an unstoppable brand.
Salesforce recently teamed with Stanford and Columbia Universities to publish The Experience Equation study, where they explored this dynamic in greater detail. They surveyed over 4,000 executives to explore possible connections between higher employee experience and engagement, customer experience, and revenue growth.
The study found that only one in three companies have designed a seamless integration between their CX and EX initiatives. When they’re aligned, the research team suggests that companies may be missing out on as much as a 50% revenue bump.
Catherine LaCour, CMO of Blackbaud, treats team engagement as one of her top four growth levers. She played a key role in Blackbaud’s shift to an innovative “remote first” business model in response to the pandemic.
A first step involved launching new operating norms. The leadership team announced a series of gatherings, including monthly executive leadership “Connect and Engage” virtual Q&A sessions, and weekly Monday huddles with Blackbaud’s top 150 leaders.
During team and individual review sessions, LaCour requests reporting across three areas – Progress (against metrics), Purpose (where someone positively impacted stakeholders), and Potential (recommendations to delight customers in the future). These approaches have created stronger commitment and engagement scores, and fuel Blackbaud’s social mission.
We define innovation as applying creativity to improve or transform the stakeholder condition. 2023 presents an opportunity to transform much more than the bottom line, and design winning growth scenarios.
- A very special thanks to Eric McCarthey, seasoned board executive and marketing strategy maven, for his contributions to my thinking around scenario planning.
- A similar version of my post originally appeared in CMO Council.