Creating Human Connection In CX With Deloitte’s Tim Greulich

During this 218th episode of “Marketing Today,” I interview Tim Greulich, managing director at Deloitte and the operational customer experience practice leader.

On the show today, we talk about the latest report from Deloitte Digital called “Creating Human Connection at Enterprise Scale.” We discuss why creating a human connection is essential in today’s service economy, how companies should be thinking about it, and why it’s so hard.

In our discussion of “Creating Human Connection at Enterprise Scale,” Greulich begins by discussing the big questions that inspired the report. He provides advice for companies that want to be more human. Greulich says, “I think it’s a recognition that people are complex.” We can design for this complexity and embrace it. The report found that when companies create strong relationships with their customers, they become more forgiving and price-insensitive over time. Relating to your customer can make you more competitive, and may even provide you with more data. Greulich says, “If used the right way, relating opens up a whole new set of information for your company.” We also discuss how this approach impacts your business results and the challenges of building relationships with customers.


Highlights from this week’s “Marketing Today”:

  • Tim’s path to Deloitte. 01:11
  • The impetus behind Deloitte’s latest report. 04:11
  • How companies can be more human. 05:39
  • The emotional component to Deloitte’s findings. 07:56
  • Designing flaws to create “wow” moments. 11:09
  • Is designing a great product or service enough? 11:32
  • How relationships affect business results. 13:53
  • Challenges in building relationships with customers. 15:10
  • Turning digital breadcrumb trails into something that comes off as more human. 17:57
  • Tim shares a defining experience. 22:00
  • Tim reflects on advice he would give to his younger self. 23:02
  • Tim shares about an impactful purchase he made in the last 6-12 months. 24:17
  • Are there any brands, companies, or causes that Tim follows that he thinks
  • other people should take notice of? 25:47
  • Tim’s take on the top opportunity and threat facing marketers today. 27:54

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Alan B. Hart is the creator and host of “Marketing Today with Alan Hart,” a weekly podcast where he interviews leading global marketing professionals and business leaders. Alan advises leading executives and marketing teams on opportunities around brand, customer experience, innovation, and growth. He has consulted with Fortune 100 companies, but he is an entrepreneur at his core, having founded or served as an executive for nine startups.

US Ecommerce Sales Will Surge 18% To $709.78 Billion In 2020

According to eMarketer’s updated ecommerce and retail spending forecast, US ecommerce sales will increase 18 percent to $709.78 billion this year—an all-time high since the researcher began calculating the metric in 2008—as a result of store closures and stay-at-home orders.

In February, eMarketer predicted total US retail sales would slightly grow by 2.8 percent to $5.621 trillion. However, due to COVID, total US retail sales will fall 10.5 percent to $4.894 trillion, a steeper decline than the 8.2 percent drop induced by the recession in 2009 and a level not seen since 2016. What’s more, total retail sales won’t rebound until 2022, when they’re expected to reach $5.549 trillion.

In addition to an 18 percent increase in growth, ecommerce will reach 14.5 percent of total retail sales in 2020, the biggest share increase in a single year. eMarketer predicts ecommerce sales will reach $765.17 billion in 2021 and $859.28 billion in 2022.

Food and beverage and health, personal care and beauty were the top two product categories growing the fastest pre-COVID-19. As consumers shift to online ordering, eMarketer has raised its forecast for food and beverage sales from 23.4 percent to 58.5 percent and health, personal care and beauty sales from 16.6 percent to 32.4 percent. Apparel and accessories will only grow 8.6 percent.

Maintaining the number one spot on the list of top 10 ecommerce retailers, Amazon will grow its market share by one percentage point to 38 percent. And, for the first time, Walmart will exceed eBay as the second US ecommerce retailer behind Amazon, with a projected increase of over 35 percent. As a result, Walmart will hold a 5.8 percent share of the ecommerce market in 2020. This will bump eBay to third, followed by Apple in fourth and Home Depot in fifth.

As ecommerce spending balloons, brick-and-mortar retail spending will continue to suffer, with an expected 14 percent decrease to $4.184 trillion.

Report: Marketers Optimistic That Privacy Regulations Will Positively Impact Personalization

Most marketers (85 percent) plan to increase the adoption of agile marketing in the next two years, according to Merkle’s Q2 2020 Customer Engagement Report, which explores how brands are pivoting operations during COVID-19, as well as how recent privacy regulations are positively impacting customer engagement.

In analyzing marketers’ organizational practices across agile adoption, Merkle found that 89 percent of marketers use agile methodology in some function or team, and nearly the same percentage (88 percent) use agile in their marketing practices in one way or another.

Larger companies have been practicing agile marketing the longest; of the group with annual revenue of more than $1 billion, 25 percent indicate agile usage for over 10 years. For lower revenue groups, agile usage was just seven percent.

The retail, financial, health and high-tech segments have shown the highest levels of agile planning, whereas travel, media and entertainment segments show a less mature adoption of agile.

When asked about the barriers to the adoption of agile marketing, 39 percent of respondents cited a lack of expertise, followed by 33 percent who expressed concerns about it disrupting their business.

While the recent passing of consumer data privacy regulations, marketers have been forced to rethink the way they leverage first-party data and build new processes to address compliance. Still, marketers say they’re confident that they can adhere to them.

In May 2018, the UK established the General Data Protection Regulation (GDPR), restricting how companies collect and manage consumer data. California followed suit when it affected the California Consumer Privacy Act (CCPA) on January 1, 2020. Under the CCPA, brands must disclose data collection and sharing practices to customers, prohibiting them from selling personal data of consumers under the age of 16 without explicit consent. The CCPA also gives consumers the right to request to opt-out of the sale or sharing of their personal information and the right to request that their data be deleted.

Despite these limitations, 92 percent of respondents are confident in their ability to comply with privacy regulations. What’s more, 67 percent see recent privacy regulations as positively impacting marketing. Over half (54 percent) say privacy regulations have made them more aggressive in their efforts to acquire first-party data. As regulations give brands a better understanding of where their customer data comes from, they’re able to deliver more enhanced personalization.

First-party data remains a significant driver of personalization, but some use a combination: 41 percent of respondents say they use first- and third-party data for personalization. Thirty-seven percent say they only use first-party data, while 21 percent say they only use third-party data.

Merkle found that UK marketers choose first-party data most often, while US marketers use first- and third-party data together 11 percent more often than their UK counterparts.  The discrepancy could be due to long-established privacy regulations in the UK or indicate that US marketers are more mature in leveraging both types of data.

When asked which data policy components are most cornering to them, 40 percent chose keeping accurate inventory of customer data, and 27 percent chose notifying customers of how they’re using their data.

To help develop new capabilities to meet data regulations, 70 percent of respondents brought in marketing service providers, 53 percent hired legal support and 46 percent tapped a consultancy.

Through a channel lens, email (19 percent) and digital media (18 percent) are the most affected by privacy regulations. Respondents ranked point of sale (POS) the least affected.

In February, Merkle surveyed 400 marketers at major US and UK brands spanning various industries.

The State Of Digital Marketing In Q1 2020

Visits to brand sites generated by organic search fell 15 percent year over year and phones accounted for 52 percent of organic search visits in Q1, according to Merkle’s Q1 2020 Digital Marketing Report. The report explores how search ad spend levels trended by industry amid the pandemic, the state of organic search and paid social and why Amazon ad spend may rebound sooner than later.

Google search ad spend grew 11 percent year over year in Q1 2020, down from 16 percent growth in Q4 2019—the lowest growth Merkle has seen in the last eight years—while clicks rose nine percent and cost per click (CPC) increased two percent. Microsoft search ad spend grew to 18 percent year over year in Q1 2020 while clicks fell 11 percent year over year. Microsoft CPCs grew significantly due to a drop in traffic from phones in the past year.

After generating 29 percent of Google Shopping ad clicks among participating brands in Q4 2019, Google Local Inventory Ad (LIAs) generated just 23 percent of Shopping clicks in Q1 2020, the lowest rate physical advertisers have seen for the format since Q3 2018. LIA click share dropped to zero by the end of Q1.

The pandemic has negatively impacted travel search budgets as Google search ad spend by travel advertisers fell 21 percent year over year in Q1, down from a 17 percent growth in Q4 2019; whereas retail Google search spend grew 13 percent in Q1.

Overall, desktop click share in Q1 fell one point to 32 percent while phone click share rose from 61 percent in Q4 2019 to 64 percent in Q1 2020. Phones produced 44 percent of total search ad spend in Q1, up from 38 percent in 2019.

Google and Microsoft saw opposing trends for device click share. Phones generated 67 percent of Google search ad clicks for Q1 while they generated 23 percent for Microsoft. Desktop share of Google clicks was 29 percent in Q1 while the same for Microsoft was 71 percent.

Excluding Instagram, Facebook ad spend grew 19 percent year over year in Q1, up from 15 percent in Q4 2019. Ad spend on Instagram grew 39 percent year over year in Q1, up from 38 percent growth in Q4 2019. Instagram accounted for 27 percent of total spend and 34 percent of impressions across both platforms for brands running ads. In addition, Instagram stories ads accounted for 22 percent of Instagram spend and 28 percent of impressions.

As a larger share of commerce has moved online amid the pandemic, ad conversion rates have improved and retailers’ ad spend has held up better for Google search. Organic search visits produced by Google decreased 13 percent year over year in Q1 and 16 percent year over year on mobile devices; Bing and Yahoo saw greater declines, with organic visits down 26 percent on Bing and 27 percent on Yahoo. 

As the pandemic unfolded, Merkle also saw organic search grow 53 percent year over year for essential retailers while organic clicks fell 31 percent for apparel and specialty merchandisers.

Amazon Sponsored Products spend grew 67 percent year over year in Q1, with clicks growing 87 percent and CPCs falling 10 percent. Sales from Amazon Sponsored Products ads increased 70 percent year over year in Q1, allowing advertisers to hold return on investment (ROI) roughly flat compared to 2019. Sponsored Brands spend ballooned to 118 percent year over year, with clicks growing 43 percent year over year and CPC seeing 52 percent growth year over year.

Merkle predicts Amazon ad spend investment will rebound as the giant stops limiting the fulfillment of non-essential products and as sales and inventory for brands start to pick back up.

CMO Council Offers Discounted Access To Global Library Of Content

The coronavirus pandemic has forced businesses to rethink their entire marketing approach but many lack the necessary data to improve responsiveness. To help businesses adjust strategies accordingly, the CMO Council is offering discounted access to its online decision support center and research library for $95 a year. 

Using the code SPRING2020, struggling businesses can tap into The CMO Library for unlimited access to peer-based knowledge and real-time market data.

Recent research from the CMO Council shows that marketers have been side-swiped by the coronavirus crisis and are looking for response ideas and customer engagement solutions. The findings show 84 percent of global marketers expect the pandemic will multiply business disruption globally and 90 percent expect to make changes to their marketing plans.

These businesses are hoping to find solutions from others who have overcome previous market upheavals as many lack the foresight to navigate marketing in the age of the coronavirus. 

According to the CMO Council’s data, 66 percent of marketers said they don’t have enough real-time visibility and insight into the pandemic’s impact across demand and supply chains. Additionally, two-thirds are dissatisfied with the quality, timeliness and usefulness of the decision support data currently out there.

Upgrading to the Library subscription will automatically convert current CMO Council members to a premium membership.

AR’s Revival Of Brand In The Hand Marketing

Originally published at AW360 by Pete Oberdorfer.

Years ago, when mobile smartphones became ubiquitous, it ushered in a new era of “brand in the hand” marketing, leveraging these new devices that people carried everywhere to serve brand experiences that were both personal and gave brands massive amounts of data. But things have already changed so much—this format is evolving rapidly, to the point of being unrecognizable from even five years ago.

Now, we can move way beyond text messaging campaigns or even QR codes, and directly into animated storytelling that directly jumps off the product. With augmented reality, “brand in the hand” has reached a new level of engagement and personalization.

Better still, the barrier to entry is less than it’s ever been. Most mobile devices are loaded with features that can integrate into these experiences: GPS for location-based AR games, cloud-enabled CMS services for updating content, and graphics engines for real-time gaming and visualization. Any and all of these can create endless opportunities for innovative storytelling—a type of experience that wasn’t even feasible a decade ago as compared to what is possible with mobile AR/XR today.

This is a new paradigm, enabled by the convergence of consumer behaviors, along with the power of mobile software and hardware. Before digital and mobile, consumers had to rely on out-of-home advertising or broadcast spots to hear a brand story or convey information about a product. Back then, users often encountered a product at the point of the purchase decision. Only recently has there been enough ubiquity of powerful mobile, connected devices that people are able to use a “camera-first” engagement method with their environment. By enabling users to easily scan products for brand-specific stories and information, they’re able to retrieve immediate AR experiences within the context of their shopping environment. This has evolved from text messaging campaigns and listed websites just a few years ago, into fully integrated holographic experiences that integrate with the packaging.

Building a modern “brand in the hand” experience

While these experiences are now easier to create, it’s still important to deliver “brand in the hand” AR that lives up to the promise of the technology and earns engagement from its audience. Each project’s approach must combine several principles, ones that we’ve successfully rolled out to our brand partners across countless AR experiences.

  1. These experiences must be brief, ideally no more than around 30-60 seconds since attention spans tend to be lower for mobile users on the go
  2. Make experiences evergreen, with content updated over time so as to invite repeated engagement
  3. Add interactivity or gamified mechanics to encourage user investment. After all, it’s more fun to play rather than just sit and watch
  4. Make your designs visually polished. This is no time to hold back on creativity
  5. Create experiences that are seamless with reality, including how it enters and exits the AR mode
  6. Always tell a good story with relatable characters and/or narratives that excite, inform and entertain
  7. Make every aspect of the experience easy to trigger, with a low barrier of entry

The future of brand in the hand 

AR-driven “brand in the hand” experiences can provide results in ways that more traditional media, like print, broadcast or the web, are no longer able to provide. It’s always proven difficult to serve brand messages to the consumer as they are making the decision to purchase. With AR comes a rare opportunity to do just that, delivering messages and stories right at the store shelves, allowing experiences to jump right from the products themselves. These kinds of packaging or product-activated AR apps have been used by literally millions and millions of people, and the resulting effects on sales are undisputed. For example, our “Living Wine Labels” app increased sales for “19 Crimes” wines by more than 200 percent.

And AR is only getting bigger, with tech companies pouring billions of dollars into AR/XR/MR technology, trying to be the first hardware platforms for a “mixed reality” future. Facebook’s Oculus division is targeting a 2023 AR wearable, Apple is releasing a wearable “glasses” AR device that same year that they say will entirely replace their iPhone, Google has devoted billions to their Google Play Services for AR, and Microsoft has a robust mixed reality presence with their HoloLens 2 device. Brands need to quickly adopt a strategy that allows them to participate in this increasing consumer wave of AR. So, why not start by experimenting with “brand in the hand?”

Report: How The Web Reacted To Coronavirus Coverage

Interactions to over 1.5 million articles about coronavirus reached 500 million in just a week during February, according to a new report from NewsWhip, “Coverage of the Coronavirus on Web and Social.” The report tracks the spread of coronavirus coverage online, which publishers have driven conversation around the issue and how brands are keeping an open line of communication with their customers.

In early January, the first English media mention of the virus came from a disease tracking website called FluTrackers, capturing the attention of other publishers. During that week, fourteen articles on the topic were published, with around 1,500 engagements. 

Coverage picked up in the mainstream press, including The New York Times and NBC, in the second week of January, resulting in 90,000 engagements on around 1,300 articles.

Engagement reached a tipping point in week three of January when 3,500 articles were published, with engagements per article increasing from 70 to 350, resulting in over a million engagements that week. Accounting for over half of the 1.2 million engagements was a story from BBC News confirming cases had tripled through infection. The story received 767,000 engagements.

Interaction to coronavirus web coverage increased from 36,701,100 engagements in the fourth week of January to 58,519,451 engagements in the fifth week.

Brands have prioritized communication with their customers during the pandemic, with many brands like Google and Walmart quickly releasing statements on their preparation and response for coronavirus while others announced updates to their policy to allow paid employee sick leave. 

The most engaged articles about coronavirus from brands include one from Microsoft (119, 512 engagements) about protecting its employees’ health and income of hourly workers, one from Walmart’s corporate site on how it’s responding to the virus (22,023 engagements) and one from Johnson & Johnson on what consumers need to know about the virus (14,060 engagements).

The most engaged websites for coronavirus content include NBC and its local affiliates (over 41 million engagements) and CNN (20 million engagements).

Engagements to political stories about the virus ranged from 767,000 to 2.1 million.

Highly engaged stories about the science of coronavirus included those from The Washington Post and Vox, focusing on the scientific basis of social distancing to decrease the rate at which people get infected and the importance of washing hands. The Post’s story about flattening the coronavirus curve received 4.3 million engagements and Vox’s article about canceled events and self-quarantine’s ability to save lives received 2.5 million.

Articles explaining why canceled events are crucial in helping prevent the spread of infection were some of the most engaged stories written, including Vox’s mentioned above, one from Bloomberg about the coronavirus conference cancellation (1.9 million engagements) and one from ESPN on the NBA suspending its season (1.5 million engagements).

Digital Transformation At PwC With Reggie Walker

During this 198th episode of “Marketing Today,” I interview Reggie Walker, U.S. Chief Commercial Officer for Pricewaterhouse Coopers (PwC).  

We discuss Walker’s background and his long career at PwC. Then Walker takes us through the digital transformation happening within PwC and the impact of technology on professional services today and in the future.

Walker shares the importance of giving employees new skills and technology to transform the way you’re running your business, which ultimately impacts client experience. 

He says, “When you focus on your people, and you build the right skills within them, those are your factors of production that you can then take out and use in multiple ways.” 

When providing advice for peers in other large companies, Walker advises that training employees and setting very clear expectations is essential. 

As Walker reflects on the future of professional services, he remarks, “Creating more personalized experiences is really what’s starting to win the day.” Walker’s thoughts on the digital transformation within PwC can help us think about how other businesses can use technology to change the way that we work. 

Highlights from this week’s “Marketing Today”:

  • Reggie provides background about his 27-year career at PwC. (01:17)
  • Reggie describes pivotal moments in his career. (03:47) 
  • Reggie tells us about his current role as Chief Commercial Officer for the U.S. at PwC. (04:37)
  • What was it like to transition from his prior role to his current position? (06:10) 
  • Reggie explains the various components of marketing and sales at PwC. (7:10) 
  • Hear about the transformation initiative happening within PwC. (9:53) 
  • How PwC doubled down on its organization internally. (12:51)  
  • The vision PwC has for taking what they’ve done to create a unique client experience. (14:35)
  • Reggie’s advice for peers in other companies that are working on large scale change. (16:43)  
  • Reggie discusses the future of professional services. (19:38)  
  • What are the top opportunities or challenges Reggie’s clients are bringing to him in 2020? (21:55) 
  • Is there an experience in his past that defines who he is today? (26:59) 
  • What is the advice Reggie would give to his younger self? (29:31)
  • Are there any brands, companies, or causes that Reggie follows that he thinks other people should take notice of? (31:13)
  • Where does he see the future of marketing? (34:00) 

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Alan B. Hart is the creator and host of “Marketing Today with Alan Hart,” a weekly podcast where he interviews leading global marketing professionals and business leaders. Alan advises leading executives and marketing teams on opportunities around brand, customer experience, innovation and growth. He has consulted with Fortune 100 companies, but he is an entrepreneur at his core, having founded or served as an executive for nine startups.

Mobile Marketing Spend To Grow 73 Percent Over Five Years, Report

Results from the February 2020 CMO Survey are in. The survey, administered bi-yearly online, covers the opinions of top marketers on budgets, firm capabilities and social media. Here we’re covering the survey’s most important findings.

Marketing budgets will increase, but not as much as last year’s prediction. The survey found that marketing budgets are expected to grow by 7.6 percent in 2021, a decline compared with last August’s 8.7 percent growth. Marketing budget as a percent of firm revenues will grow to 8.6 percent, a nine percent increase since 2018, while marketing budget as a percent of firm budget remains consistent at 11.3 percent. 

Digital marketing is growing faster than traditional marketing with brands spending nine percent on customers, 7.1 percent on brands and 6.1 percent on product innovation. Marketers are spending 15.2 percent of budget on customer experience, a 71 percent increase over the last three years.

Marketing capability development remains the top marketing knowledge priority for service companies, even more than product companies, at 12.7 percent followed by marketing consulting services at 11.2 percent.

Marketers are investing 54 percent of spending on existing markets and offerings while diversification remains the lowest growth strategy. Companies are continuously focusing on domestic marketing with a 13 percent increase observed since 2012.

Current budget spending on China is at 2.1 percent, up 1.7 percent three years ago. Marketers plan to increase Chinese budgets 100 percent to 4.2 percent in three years with the biggest spenders in mining and tech.

When data was collected for this survey in January, Chinese budgets were expected to exponentially grow. However, the outbreak of the Coronavirus may eventually slow international spending given the disruption of consumer spending in China, as cities are currently being described as ghost towns. Similarly, an outbreak in the US could disrupt consumer spending here, which accounts for 70 percent of the economy.

Internet sales as a percent of revenues are at the highest level in a decade at 13.5 percent. The space is dominated by B2C companies at 18.1 percent.

Social media remains important for marketers as spending grew to 13 percent of marketing budgets, the second-highest point in CMO Survey history. Companies with 10 percent internet sales dedicate more than twice the spending to social media than those with no internet sales. Outside agencies now perform about a quarter of all social media activities, the highest level reported since the question was first asked in 2014.

Across all industries and company sizes, social media spend for companies will increase by 62 percent over five years. Despite this, marketers continue to rate it as contributing only moderate value to company performance (3.4 on a seven-point scale).

Mobile spend also continues to rise and is expected to grow 73 percent over the next five years, with companies citing social ads the highest spend in mobile. Companies that sell at least 10 percent online see the most value with mobile, averaging 4.1 percent compared to a 2.7 average for companies that don’t sell online. Difficulty tracking customers across the mobile journey is the top challenge for companies.

Among the quality of companies’ marketing knowledge resources, companies ranked marketing capabilities highest, followed by customer insights then competitive intelligence. Online sellers rated their marketing knowledge resources as higher in quality, dominated by analytics and intelligence.

Survey results are based on a sample of 265 top marketers at for-profit US companies, 98 percent of which include responses from vice president level or above, surveyed from January 7-28, 2020.

Delta Air Lines Transforms Mobile App Into Digital Travel Partner

Delta Air Lines recently announced plans to overhaul its mobile app, Fly Delta, and shared details about its expanding partnership with Lyft to potentially let customers pay for rides using travel miles.

The airline’s goal is to transform its app into a digital concierge that appeals to mobile-savvy consumers. The improved app will offer customers curated partner services, such as the linking of Delta SkyMiles and Lyft accounts helping customers earn miles during Lyft rides. 

The app will proactively notify users of any travel-impacts such as weather and traffic and is powered by Delta’s new artificial intelligence-driven machine learning platform. Travelers will also be alerted when their seat is boarding when virtual queuing comes to the app later this month. Updates to the mobile app follow Delta’s recent moves to integrate Transportation Security Administration (TSA) wait times in select airports and offer international automatic check-in and pre-select meals. 

“Customers tell us they want Fly Delta to become their ‘home base’ for managing their travel day. That’s why we’re evolving the app to become the ultimate travel companion for all points of your journey–with an eye on expanding the convenience and value of using miles as a form of payment for services with Delta and partners, throughout,” said Ed Bastian, CEO of Delta Air Lines.

Integrating ride shares into the Delta travel experience follows findings from an independent study Delta conducted that shows ride-sharing helps make travel days more enjoyable. Delta and Lyft first teamed up in 2017, a partnership that has since earned SkyMiles members more than 1.5 billion miles nationwide.