Breaking News About the Challenges Facing Marketers in 2008

This morning over my morning Coke Zero (I don’t drink coffee), I briefly looked at a study put out by the Chief Marketing Officer Council about customer retention. The purpose of the study was to identify what deepens, solidifies and perpetuates customer relationships. Why commission such a study? Is it because marketers are facing some stiff challenges? Why do the companies sponsoring the study want us to focus on this problem? I have listed below what the CMO Council claims in the study are factual, statistically sound truths about the challenges facing marketers.

Challenges Facing Marketers in 2008
1. The average U.S. business loses 10% of its customers annually due to attrition--you would think the pain of this alone would be enough to motivate change, but this is not typically the case

2. Capturing new customers costs 500% more than satisfying and keeping present customers in satisfying relationships--the challenge is in convincing your company to take the long view on relationships

3. For every one-percent increase in customer retention the average business will save five-percent in costs, not to mention the added value of revenue retention--convincing most top team members to invest in retention is a tough sell

4. Committed, satisfied customers are 1500% more likely to spend more with businesses than their higher-risk, intermittent counterparts--you must convince your company you are capable of influencing satisfied customers to actually spend, not just be likely to spend

The CMO Council claims that companies are focusing on front-end lead generation, but not doing enough with their existing customer data. They further claim that marketers should determine their most profitable customers, improve the customer experience and increase business with those customers.

Allen DAngelo’s advice for CMOs…

The present business environment in which CMOs must operate is treacherous at best. CMOs are often caught in the fray between CEOs and CIOs. Top management executives demand short-term gains at the expense of customer relationships and information executives are resilient to the collaboration necessary to enable the greatest use of customer knowledge. CMOs face challenges in knowing how to harness Mount Everest-size volumes of customer data while balancing and integrating the human dynamics of emotion into the experiences customers desire.

Being a CMO is a tough job… it may feel like a mission impossible. Some days you are the fall guy. You may feel like quitting some days… most days.

CMOs need to become organizational connectors who build bridges from resilient top managers to the customers. They need to become more forceful by taking a dominant role in leading their companies. They need to become Strategic Growth Champions who lead their company past the short-term nonsense and toward relationship rich horizons where customers feel trust again.