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Customer Data Platforms and Why You Need One
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Six Reasons Why The Metaverse Is Here to Stay PM 4 0 0 5 0 8 0 3
VOL. 35 • NO. 6 • JUNE 2022
THE AUTHORITY FOR THE DATA-DRIVEN BUSINESS
Interview With
Neil Bendle Gain a fresh perspective on Canada’s distinct communities and markets
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MARKETING METRICS
Gain a fresh perspective on Canada’s distinct communities and markets With segments like The A-List, Metro Melting Pot and Silver Flats, PRIZM’s 67 lifestyle segments help you create the personalized customer experience and communication to drive acquisition, engagement and loyalty.
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Vol. 35 | No. 6 | June 2022
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CONTRIBUTING WRITERS Hamza Khan Tom Fricano Stephen Shaw Eric Hazan Dennis Spillecke Fiona Hillard Lareina Yee Greg Kelly
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Customer Data Platforms and Why You Need One
INTERVIEW ❯9
Marketing Accountability
All-In-One Marketing Platform Approach Failing To Build Customer Trust
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An Interview with Neil Bendle, Associate Professor of Marketing, University of Georgia, and Chair of the Marketing Accountability Standards Board
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Chipotle Rewards members can earn extra points and collect achievement badges with Extras. The gamified loyalty experience offers personalized challenges allowing members to level up and earn free Chipotle faster. “We’re excited to engage with our Canadian guests in a brand new way with Chipotle Rewards,” said Chris Brandt, Chief Marketing Officer. “Our personalized loyalty program allows members to select how they redeem points, earn Extras by participating in challenges, and achieve badges for their achievements.”
Canada’s Ritchie Bros. markets and sells so much heavy equipment, well, it’s astonishing.
Chipotle Rewards means real food becomes real free real fast. Chipotle Mexican Grill officially launched its loyalty program, Chipotle Rewards, in Canada. This is the latest advancement in Chipotle’s efforts to make the brand more accessible and to strengthen the relationship with its Canadian community. Chipotle implemented its U.S. loyalty program in 2019 and in only three years, 28 million members have enrolled, making it among the fastest growing loyalty programs in the history of the restaurant industry. “Chipotle Rewards is another access point for guests to engage with our promise of real ingredients prepared fresh daily, and a way for us to say thank you for joining our mission of Cultivating a Better World,” said Anat Davidzon, Managing Director, Chipotle Canada. To start earning free Chipotle with Chipotle Rewards, fans can sign up in the Chipotle app or at chipotole.ca/rewards. Members of Chipotle Rewards in Canada earn 10 points for every $1 CAD spent in the restaurant, online or in the app. After as few as two purchases, Chipotle Rewards members can earn enough points to start unlocking free Chipotle. Chipotle Rewards brings instant gratification to guests with free chips and guac* after the first purchase as a member and a surprise birthday reward every year. ❱ DMN.CA
Round Up for Real Change
Guests ordering digitally can also round up their bill to the next highest dollar amount to donate to Chipotle’s nonprofit partners. To celebrate Pride month, Chipotle is spotlighting Egale, Canada’s leading organization for 2SLGBTQI people and issues, in its app and on CHIPOTLE.CA. Since launching its Round Up for Real Change program in 2020, Chipotle has raised over $12 million USD for non-profit partners in the U.S. Chipotle is Cultivating a Better World by serving responsibly sourced, classicallycooked Mexican-inspired cuisine with wholesome ingredients and no artificial colours, flavours or preservatives. Committed to Food with Integrity, Chipotle’s real food is cooked fresh daily with no freezers or can openers in its restaurants. Chipotle is the only restaurant company of its size that owns and operates all of its restaurants. The company currently has 28 restaurants in Canada, with plans to open four additional locations in British Columbia and Ontario this summer. Last week, Chipotle opened its 10th restaurant in Toronto in the Liberty Village neighbourhood and wants to cultivate a better world by serving responsibly sourced, classically-cooked, real food with wholesome ingredients without artificial colours, flavours or preservatives. ■■■■■■■■■■■■■■■■■■
Now, they are expanding their offerings for oil & gas industry customers with new dedicated Energy team. Ritchie Bros. Energy will offer a complete suite of transaction solutions, services, and insights. Ritchie Bros. has a long history of serving the oil & gas industry, with its first energy auctions conducted in the 1960s. For the last several years, some of the company’s oil & gas equipment auctions have been held under the Kruse Energy brand, with online bidding available through IronPlanet.com. Going forward, all oil & gas customers will be helped by the Ritchie Bros. Energy team, with access to Ritchie Bros.’ complete suite of transaction solutions, services, and insights—meaning more options for sellers and more selection for buyers. “Oil & gas companies want the same level of choice as any other consignor,” said Ann Fandozzi, Chief Executive Offer, Ritchie Bros. “With Kruse we offered a one-size-fits-all solution. With Ritchie Bros. Energy we can offer unreserved auctions, weekly featured online events, a daily reserved marketplace for premium assets, and a listing service. We can also offer oil & gas customers a variety of value-added services and data solutions, along with access to unmatched global reach and buyer demand.” Ritchie Bros. held its final Kruse Energy auction last week, attracting approximately 3,500 bidders. The first Ritchie Bros. Energy event will be held in September in conjunction with Ritchie Bros.’ Fort Worth, TX auction, which typically attracts more than 12,000 bidders from 60+ countries. “This is all about providing more options for our sellers and selection for buyers,” said Kelly Kittson, Ritchie Bros.’ Director, Strategic Accounts, and leader of the Ritchie JUNE 2022
// 5 Bros. Energy team. “For our buyers, we will be leveraging teams globally to find more supply. For sellers, our Fort Worth ‘Energy Days’ will attract more bidders than we ever could with the Kruse Energy brand, driving stronger prices for your used equipment and surplus assets.” Established in 1958, Ritchie Bros. (NYSE: RBA) (TSX: RBA) is a global asset management and disposition company, offering customers end-to-end solutions for buying and selling used heavy equipment, trucks and other assets. ■■■■■■■■■■■■■■■■■■
an enviable reputation for its mouth-watering wings, of which it sells more than 2.2M each year. The recipe for its famous wings start with the highest quality chicken wings. While many have tried to uncover exactly how St. Louis makes its wings taste so delicious, its recipe remains a trade secret. St. Louis’ wings are available in 29 flavours that include its top selling Medium Dry Rub, as well as Carribean Jerk, Chili Lime, Chipotle Mango Dry Rub, Garlic Parm, Buffalo Ranch, General Tao’s, Smoked BBQ Heat, and more. The wings are best enjoyed with friends, along with a side of signature fries, and addictive Garlic Dill sauce. Proudly Canadian owned and operated, St. Louis Bar & Grill first opened its doors in Toronto in 1992. Famous for its ‘Devilishly Good!’ service, signature wings, and Garlic Dill Sauce, its local neighbourhood establishments offer exceptionally warm and friendly service in a fun, casual sports bar and grill setting. There are 74 restaurants across Canada, with 63 located in Ontario. ■■■■■■■■■■■■■■■■■■
Official Coffee of the Renowned Dance Company, with a Slate of Marketing Initiatives Set for 2022 and Beyond.
What Do You Do With a 100 sq. ft. Wet Nap? St. Louis Bar & Grill, Canada’s go-to destination for ‘Devilishly Good!’ food and atmosphere kicked off Wingsanity at its restaurants across the country with a “nap”. Wingsanity’s long awaited return after a two-year hiatus St. Louis is offering lucky guests an opportunity to increase their chances of staying clean with a giant 10 ft. x 10 ft. Wet Naps that are 25 times larger than regular sized versions. “Over the years we’ve come to realize that all you can eat wings really do need an all you can eat Wet Nap. We have so many guests who really embrace the spirit of this iconic event, leaving our restaurants covered in sauce. We hope this helps them to return home a little cleaner,” said Royal Nasager, V.P of Marketing, St. Louis Bar &Grill. Over the last 30 years, St. Louis has earned JUNE 2022
Balzac’s Coffee Roasters, a specialty coffee roaster with a network of cafés, direct-toconsumer operations and a high-growth CPG business, is pleased to announce its new partnership with The National Ballet of Canada that sees Balzac’s become the official coffee supplier to Canada’s pre-eminent dance company. The multi-faceted, multi-year deal makes Balzac’s the exclusive coffee beverage served at all National Ballet of Canada events, as well as seeing the two brands collaborate on various marketing initiatives to their respective audiences and communities, including sponsorships, sampling opportunities and onsite marketing activations. “We are absolutely thrilled to announce this new partnership with the National Ballet,” says Christine Cruz-Clarke, CEO of Balzac’s Coffee Roasters. “The National Ballet has such a rich history of engaging its audiences with the finest repertoires in dance. We strive for the same degree of excellence in our own field and look forward to working with them as this new season unfolds.” Established in 1951 with the goal of presenting the best in classical and contemporary ballet to Canadian audiences, The National Ballet of Canada is known around the world for its performances of traditional, full-length classics, as well as embracing contemporary works and the development of top notch Canadian choreographic talent. The National Ballet performs extended engagements at Toronto’s
Four Seasons Centre for the Performing Arts each year, augmented by both national and international tours. “We are excited to embark on this endeavour with Balzac’s Coffee Roasters,” says Barry Hughson, Executive Director, The National Ballet of Canada. “Our patrons have come to expect the best from the National Ballet, and by extension, the brands we associate with. This partnership with another beloved, national brand, continues to deliver on that promise.” Established in 1993, Balzac’s has seen continued success roasting specialty coffee and providing European inspired café experiences across Ontario. Inspired by Honoré de Balzac’s famous quote, “the Café is the People’s Parliament,” the 100 percent Canadian coffee company is dedicated to sustainably sourced and roasted coffee that can be enjoyed in one of the many Balzac’s cafés, ordered online or found on retail shelves nationwide. District Ventures Capital is a venture capital fund investing in innovative companies in the food & beverage and health & wellness sectors. The fund is led by General Partner, Arlene Dickinson. Venturepark is the leading ecosystem in Canada that focuses on the CPG space and brings capital, marketing support, programming, and commercialization as support to the companies it invests in. ■■■■■■■■■■■■■■■■■■
PointsBet Canada now an Official Sports Betting Partner of ClubLink. PointsBet Canada is hitting the links with ClubLink, Canada’s largest owner and operator of golf clubs. The multi-year partnership will see PointsBet Canada become the Official Sports Betting Partner of ClubLink which hosts over 1,000,000 rounds of golf annually at its clubs in Ontario. “We are delighted to be partnering with one of the most recognized brands in Canadian golf,” said Nic Sulsky, Chief Commercial Officer at PointsBet Canada. “A friendly wager is a regular occurrence among golfers enjoying a round which makes the ClubLink audience a natural fit for us. Golfers are some of the most passionate sports fans and we cannot wait to show them why PointsBet is the two-time winner of EGR North America’s Best Sports Betting Operator.” PointsBet Canada entered the country’s new legal sports wagering market in April, accepting its first bet just 50 seconds into the launch of Ontario’s regulated market. As one of the fastest growing operators in North America, the company has made a sincere commitment to the Canadian market, including partnerships deeply rooted in Canadian sport and a team headquartered in Toronto. PointsBet prides itself on offering DMN.CA ❰
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unmatched speed and ease of use across every customer touchpoint, as well as the deepest slate of pre-game and in-play betting options in the world, thanks to owning and controlling its technology. “Newly launched in Ontario, PointsBet has already shown a great deal of dedication to offering unique experiences to its customers,” said Brent Miller, Vice President of Marketing and Business Development at ClubLink. “We’re thrilled to partner with one of the preeminent sports wagering operators in the world and to add value to the ClubLink Member experience through PointsBet’s support of our networkwide championships.” “From day one, PointsBet Canada has been focused on living our brand as one of the few locally based Canadian companies through long-term partnerships with brands that embody our country’s sports landscape,” added Keesje Kort, Director of Commercial Partnerships at PointsBet Canada. “We’re looking forward to a summer of fun engaging ClubLink’s members throughout their clubs in Ontario.” PointsBet is a corporate bookmaker listed on the Australian Stock Exchange with operations in Australia, the United States, Canada and Ireland. PointsBet has developed a scalable cloud-based wagering platform through which it offers its clients innovative sports and racing wagering products, advance deposit wagering on racing (ADW) and iGaming. ■■■■■■■■■■■■■■■■■■
Leo Burnett Design takes on rebranding Canada’s largest Museum, to help transform ROM (Royal Ontario Museum) into a dynamic new presence for the 21st century. “Our visual identity is our first impression with people. It had to be bold and contemporary, and signal the change that is happening within the ROM walls,” says Lori Davison, ROM Chief Marketing & Communications Officer. “We partnered with Leo Burnett Design knowing ❱ DMN.CA
they could design a world-class identity that would bring our vision to life and create a heartbeat for the brand within the city.” The rebrand includes a new wordmark, a custom typeface, design system and photography by Mike Tjioe and Saty + Pratha. The new visual identity is featured first, in a Union Station takeover and will continue to influence communications, exhibitions, merchandise, ROM magazine, wayfinding and more within the building. “The new visual identity expresses ROM’s vision in an iconic and simple way. The Museum’s 13 million objects and natural history specimens were reimagined as an immortal timeline. It uses a typographic approach that expands and contracts allowing people to be immersed in any moment in our history,” says Man Wai Wong, VP Group Creative Director, Leo Burnett Design. “The identity is truly timeless, because it captures all of time — past, present and future.” The new identity is unveiled in tandem with ROM’s Immortal brand campaign. Developed by Broken Heart Love Affair (BHLA), the campaign brings to life the idea that every object in ROM is a portal to powerful stories that live on forever. ROM, in partnership with Leo Burnett Design, will continue to roll out the evolution of the brand over the coming year. Leo Burnett Canada is a creative consultancy using strategy, design thinking, communications and experience design to solve the biggest business challenges of the modern age. We believe creativity has the power to transform human behaviour and we use creative in all forms to better the relationship between people and brands. A part of Leo Burnett Worldwide, we operate a global network of over 200 operating units and 96 full-service agencies in 85 countries and is a wholly owned subsidiary of the Publicis Groupe.
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More than $10.8 million to support Manitoba’s travel, tourism, and recreation initiatives, creating jobs and growing the economy. From northern lights and polar bears in Churchill to The Forks historic site in downtown Winnipeg—tourism is an integral part of the province’s economy. The Government of Canada recognizes the impact that the pandemic has had on Manitoba’s tourism industry, and is helping travel, tourism and recreation providers recover, build back better, and safely welcome visitors to enjoy new and unique experiences and destinations. The province is making a marketing investment of $10,853,481 to support 39 projects in Manitoba’s hard-hit tourism sector. This funding is provided through the Tourism Relief Fund, Canada Community Revitalization Fund, and Regional Relief and Recovery Fund programs. Projects include the development of a number of Manitoba’s top tourist attractions. Among them: ❯ The Forks Renewal Corporation received over $1 million to complete several projects, including the construction of a one of a kind Treaty Knowledge Centre done in partnership with the Treaty Relations Commission of Manitoba. ❯ The Royal Aviation Museum of Western Canada received $500,000 to create and install exhibits at their newly opened museum space at the James A. Richardson International Airport. ❯ Fort Whyte Alive received $747,465 to enhance the gathering areas and wetland trails throughout the nature park. ❯ The plan will have an impact on a wide range of tourism, community and recreation initiatives, helping businesses and organizations recover, grow and thrive, JUNE 2022
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while visitors and residents explore friendly Manitoba. “Summer is right around the corner the time is now to welcome visitors back to our province and safely enjoy all Manitoba has to offer,” said Daniel Vandal, Minister for PrairiesCan. “Manitoba is known as a gathering place, where people come together to experience the rich culture, beautiful landscapes, and history of our province. Tourism is a critical industry for Manitoba and through these investments, our government is helping the travel, tourism, and recreation providers create new — or enhance existing — experiences, revitalizing communities, and attract visitors. Together, we are ready to welcome people from across Canada and the world back to Manitoba.” “The new Royal Aviation Museum has a vision to be one of Manitoba’s signature tourist attractions and to be a beacon welcoming visitors to Winnipeg,” said Terry Slobodian, President, CEO and Curator of the RAF Museum of Western Canada. “Creating interactive and immersive exhibits was key to delivering a unique and engaging experience for visitors of all ages and interest levels. The generous support of PrairiesCan allowed us to not just tell aviation stories but bring them to life through a variety of video, audio, and tactile features in our exhibits.” The Tourism Relief Fund (TRF) helps tourism businesses and organizations adapt their operations to meet public health requirements while investing in products and services facilitating their future growth. The Canada Community Revitalization Fund (CCRF) helps communities across Canada build and improve community infrastructure projects to rebound from the effects of the COVID-19 pandemic. More than $10.8 million will support Manitoba’s travel, tourism, and recreation initiatives, creating jobs and growing the economy. As part of Canada’s COVID-19 Economic Response Plan, the CCRF helps communities across Canada build and JUNE 2022
improve community infrastructure projects so they can rebound from the effects of the COVID-19 pandemic. With a national investment of $500 million over 2 years, the Fund’s purpose is to help not-for-profit organizations, municipalities, and other community groups, as well as Indigenous communities build new community infrastructure and revitalize existing assets, bring people back to public spaces safely as health measures ease, create jobs, and stimulate local economies.
announce a long-term renewal with BMO as we not only set our sights on delivering another championship for the city and our fans, but also a long-term ambition to grow the game and create opportunities for women and girls in soccer across the country. We are grateful to BMO for their continued support and excited about all that we will be able to accomplish together over the next ten years.” Toronto FC has long invested in player development through the Academy and TFC II that trains and prepares top-tier talent at BMO Training Grounds for a professional career. BMO shares the club’s passion for developing and growing young talent and continues to be a presenting partner of KickStart, an MLSE Foundation program also in association with Toronto Public Housing, which introduces youth to the game of soccer with a focus on physical literacy and fundamental skill development. BMO’s investment in the KickStart program enables the foundation to provide equitable access and opportunity for youth, and for the first time, a portion of BMO’s TFC Kickstart Program will be built and delivered specifically to self-identified girls and will feature women leaders in sport, ensuring a strong generation of women in soccer for years to come.
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TFC and BMO renew their game plan with 10 year agreement. With the second half of the Toronto FC season underway, the club and BMO Financial Group (BMO) announced the renewal and expansion of their foundational partnership. This agreement ensures BMO is featured prominently on the Toronto FC kit and that the home of Toronto FC will continue to be named BMO Field. BMO Field will also proudly host matches during the 2026 FIFA World Cup with Toronto being recently announced as a host city. As both organizations look ahead to the next decade, a key priority of Toronto FC and BMO at the grassroots and professional levels of soccer will be promoting equity in the sport and developing more avenues for women and girls to learn, play and coach. “BMO has been a foundational partner of Toronto FC’s since day one of the franchise’s history and have played a pivotal role in the growth of the club, and its many successes, in those fifteen years,” said Toronto FC President Bill Manning. “It is fitting that we
Jordan Vader, Senior Vice-president, Global Partnerships, MLSE, Tanya Maruck, Vice President, Community Engagement & Social Impact, MLSE, Cam Fowler, Chief Strategy and Operations Officer, BMO Financial Group, Bill Manning, President, Toronto FC and Toronto Argonauts and Justin Bob, Director, Equity, Diversity & Inclusion, MLSE at BMO Field celebrating our ten-year recommitment. (CNW Group/BMO Financial Group) DMN.CA ❰
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TECH
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All-In-One Marketing Platform Approach Failing To Build Customer Trust BY TOM FRICANO
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ver the past two years, we have experienced a significant shift to online commerce. Not only are these voluminous transactions regulated by privacy laws such as GDPR and CCPA, businesses are also receiving customer backlash related to poor customer experiences. This transformation of interacting with customers online has called for greater strategy and technology capability, in which the balance between data collection and customer experience must be established to succeed. In fact, the very practice of how businesses collect customer data will either build or destroy customer trust. Why is consent and preference management becoming more important? Customer consent is important because it grants permission for brands to provide marketing or service communications with prospects and customers, hence, comply with regulations. While customer preferences such as product interest, channel preference, and frequency of communications help brands understand what’s best for the customer based on their wants and needs. Preference management is also important, as constant collection of customer data will help drive the brand’s revenue, marketing efficiencies, and other KPIs. We all sign up for newsletters, product information, promotions as well as lifestyle preferences ❱ DMN.CA
related to things such as travel. Therefore, it is important for all customer-facing departments (e.g., marketing, sales and customer service) within a business to make it easy for customers to indicate and change their preferences as their interests evolve over time. Companies today are spending millions on marketing technologies that enable seamless customer consent and preference management. Research firm Allied Market Research estimates that the consent management industry will represent $2,271.1 million by 2030, up from $318.3 million in 2020 and registering a compound annual growth rate of 21.9 percent from 2021 to 2030. Not all preference and consent providers are equal While many businesses are realizing they need these critical technologies to enhance, refine and preserve the overall customer experience, they should do their homework when selecting the right preference and consent management technology provider to work with – as not all have the same capabilities. All-in-one may not mean best solution At first glance, there are a handful of enterprise-level technology providers that do everything from customer relationship management to marketing automation to preference management. These cloud-based software companies have the look and feel of a “Big Box” provider and offer a suite of
applications in their own customer data platform to help companies manage all aspects of their business and maintain relationships with their customers. The allure of working with a provider such as this is the single vendor, “all-in-one” solution where there are often no additional costs or integration required for a core platform. However, what they gain in their one-stop allure, they often fall short in truly satisfying the need for depth of functionality, configurability, regulatory compliance, and the ability to activate data across-platforms. Specialty vendors can build custom solutions On the other hand, specialty providers that focus on consent and preference management solutions offer a more holistic approach that includes strategy, best practices, process, and governance in addition to technology. They often start by interviewing their customer’s customer to understand what’s truly important to them. With this insight in hand, they can design a holistic solution that meets both the consumers and organization’s needs. Then they are ready to manage the deployment process and help gain adoption. This greater internal and external adoption leads to increased customer engagement, improved marketing ROI and higher revenue potential. In short, providers that offer strategic and professional services can help you get far more out of the platform than you can realize on your own.
Along with internal adoption comes the ability to help integrate preferences for customers across the entire organization and its many departments — a critical function that can be missed by “big box” providers whose offerings aren’t designed to meet this unique set of needs. As a result, this leads to a single view of the customer, greater customer trust and assurance of regulatory compliance. On the surface, listening to customers and honoring their preferences is not only obvious, it’s a must in today’s customerdriven business climate. Every business today must listen to their customers and the outcomes are immediate and apparent. As digital environments grow increasingly more complex — along with the penalties introduced for noncompliance — businesses of every size, and in every region must rely on the right solutions. Digital transformation of collecting customer consent and preferences is an iterative process that will continuously change and adapt to an ever-evolving marketplace, but it is now up to each individual business to determine the right provider to work with for the right set of unique solutions. TOM FRICANO is the Senior Practice Director of Strategy and Consulting at PossibleNOW. With more than 25 years of experience, Tom assists clients with customer experience, preference management and consent initiatives through advisory and strategic consulting, technology expertise and project to product to implementation roadmaps. JUNE 2022
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INTERVIEW
Marketing ACCOUNTABILITY An Interview with Neil Bendle, Associate Professor of Marketing, University of Georgia, and Chair of the Marketing Accountability Standards Board
BY STEPHEN SHAW
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hey are two solitudes — operating in isolated siloes, regularly clashing with one another, insistent on their point of view. So why do finance and marketing act like they are on opposing teams? Why the rancour? The lack of respect? The budget skirmishes? For starters, they’ve never shared a common business vocabulary, using terms and expressions that are foreign to each another. And neither has CONTINUED ON page 12
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INTERVIEW CONTINUED FROM page 9
much interest in learning a new language. Finance holds marketing in low esteem for their negligible financial acumen. Marketing sees finance as cost-cutting technocrats, risk-averse and short-sighted. Finance has no clue what marketing does, while marketing is unable to read a balance sheet. A big source of tension is their conflicting mandates. Marketing believes it has to spend money to make money, and subscribes to the adage that “not everything that can be counted counts”. Finance believes its job is to manage costs. Marketing is a cost centre, in their view, where spending powers must be kept in check. The most acrimonious point of contention is their lack of alignment around the performance metrics that matter. For marketers, success usually means a gain in some intangible measure like brand awareness and preference. Marketers are giddy when their campaign results exceed expectations, whereas finance only cares about cash flow and operating margins. They insist on knowing how marketing intends to influence those key measures. And of course marketing has no clue how to connect any of the metrics they care about to business
outcomes. Marketing just knows, intuitively, that future cash flow depends on happy customers who love their brand. But finance wants proof of that assumption. The fact that marketing has no credible evidence confirms their bias that it’s all “smoke and mirrors”. To finance, marketing is a world of make-believe, unaccountable and at worst delinquent. Yet for businesses to succeed, at a time when brand loyalty everywhere is up for grabs, finance needs to see marketing as an investment and not simply a P&L expense, subject to arbitrary cutbacks. At the same time marketing has to be more accountable, making spending decisions as though they were using their own money. Today marketers have no idea how much impact their spending has on revenue growth. They just know the cost of running media ads. There are many deep-rooted organizational and cultural barriers in the way of a more collaborative relationship between marketing and finance. After all, finance looks at the business as a ledger sheet, where making your numbers is all that matters, while marketing is driven by more conceptual thinking and drawn to creative expression. The truth is, finance
people will never make good marketers, and marketers will never make good accountants. Yet somehow they have to find common ground — learn to play off each other’s strengths — and come up with a set of mutually acceptable measurement standards and models (like brand or customer equity). They also have to work more closely together throughout the marketing planning process, approaching every spending allocation decision as a business case for investment. Marketing should play a key role in setting the short and long-term growth objectives of the business, while finance helps with the cost/ benefit analyses and shows how to optimize spending, not simply curtail it. That job of developing accepted standards for the measurement of marketing is the singular mission of the Marketing Accountability Standards Board, a cross-industry forum of senior marketing professionals, academics and finance experts under the chairmanship of Neil Bendle. A former accountant himself, who once served as the Finance Manager of the Labour Party in Britain, he is an Associate Professor of Marketing at the University of Georgia and best known for the popular book he coauthored called Marketing Metrics (now in its 4th edition). Stephen Shaw: What made you cross over from accounting and join the ranks of the enemy? Neil Bendle: When I was working with the Labor Party I would chat with direct marketers — so I had some idea of what marketing was all about. But at the time I was still very much an accountant. Then I went to do my MBA and Paul Farris, who was my professor at Darden [University of Virginia], was very keen on the idea that marketing is about numbers. And of course I very much appreciated that. And so I fell into marketing that way. Marketers, and this is somewhat ironic, are not very good at communicating to finance people what they’re doing and why they’re doing it. But if you think of finance as a language, you really need to understand that language to talk to people in accounting. And I think too many marketers have this
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idea that they’re doing something good and everyone else should already be aware of that. I think as marketers we all think financial accountants just kind of hate us. They don’t. Shaw: Do marketers get enough training in finance? Bendle: Probably not. One of the things I’ve always been keen to do in my teaching is push the numbers side, push the financial side. You know, if you’re going to be a marketer, you do need to have some basic understanding of the wider business. You need to understand what the financial statements are saying. One of the things I teach my students is just go to an investor relations page, print out the accounts, now try and find the value of brand. Shaw: Good luck with that. Bendle: Yeah. The value of a brand on the balance sheet is likely to be nothing. It’s called the “moribund effect”, when brands go on a balance sheet and then that’s it. There might be nothing in the account if it was developed internally. Or there might be the original purchase value. When you look at the accounts of a public company, the chances are you’re going to have absolutely no idea what the marketers are up to. It’s hard to measure the value of a brand. It really is. Especially for an accountant. If they get it wrong, people are going to blame them. If they just say, well, it’s nothing, that’s what the rules are, then it’s pretty easy to put nothing in the accounts and you’re not going to get that wrong. Shaw: Well, it’s an intangible measure, isn’t it? That makes it hard for an accountant who’s used to dealing with hard auditable numbers. Bendle: Yeah, I mean, accountants are really bad with intangibles. We don’t have a super clear definition of what we mean by a brand. And so we don’t really know what we’re trying to value. Shaw: The bigger question is not just proving the value of the brand. It’s actually proving the value of marketing. How do marketers make their case to the CEO? JUNE 2022
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INTERVIEW Bendle: It is a big challenge. What we’re trying to do with the Marketing Accountability Standards Board is bring accountability to marketing. And one of the things that we’ve done is put together a marketing dictionary. One reason why accounting is powerful is because when you see a financial statement you know what the terms mean. The same should be true of marketing. So for instance, one of the things I’ve been thinking about recently is the value of a customer. When we say we have a value of a customer, we should have that number. People should know what it means. When you see an accountant and say our customers are worth a certain amount, then you should be able to justify that number. When we talk about customer lifetime value, we can talk about the customer asset, as long as we have a clear idea of what we mean by customer lifetime value. Why do we spend our time worrying about someone stealing the paperclips while we have no idea what the customer asset is worth? It’s just doesn’t make sense. Shaw: Let’s take the example of social media. Every marketer understands that they need to have a social media presence. But that requires an investment. How do you demonstrate ROI on investment in social media, for example? Bendle: There are a lot of challenges. But one of the things I think we can get do is have a clear forecasting model and put our assumptions on paper. Once we get that model down on paper, I think we can start to improve it like, when we see great activity on social media, what do we expect the long-term consequences to be? Do we expect sales to rise in the next year? If we could start doing that, that pushes back the boundary of the unknown. Shaw: Is the central challenge the fact that marketers don’t think of the money they’re given as an investment, but as a discretionary expense, to be spent on whatever they please? Bendle: That’s a great way of saying it. An awful lot of what we do as marketers is an investment. JUNE 2022
And that’s one of the great things about customer lifetime value. It allows you to start thinking about the customer as a longterm investment. If we make the investment, the value of our customer base will go up because we’re treating our customers better. That’s a powerful argument. If we start seeing that as an investment, it’s going to be really helpful. So why does accounting not see it as an investment? One of the central tenets of financial accounting is matching — the idea that your revenues and costs should be matched. What happens in marketing is that some costs are incurred but the associated revenues might not be realized until sometimes years later. And so the accountants are violating their own principle of matching by treating some marketing costs as an immediate spend when it is actually an investment. In accounting, there are two different branches: financial accounting and managerial accounting. I’d love to see managerial accountants take over all of accounting. It’s managerial accountants who should be creating the information for management decisions. I’m all for financial accounting having a role. But I think financial accounting has taken over. I’ve talked to CFOs who have said managerial accounting can do anything it likes as long as it follows GAAP [generally accepted accounting principles]. But the whole point of managerial accounting is it doesn’t have to follow GAAP! In managerial accounting, if something is an investment, it can be treated as an investment. So marketers need to go and make friends with their managerial accounting buddies. Shaw: How do you figure out the interaction effect of using multiple channels on cash flow? Is part of the problem that marketers tend to look at channel metrics in isolation? They don’t synthesize the different types of measures into a more integrated framework. Bendle: That’s something that we’ve talked about at MASB, and basically, I agree with you. You can see why marketers go for the
I can understand why the C-suite would say our job is not to maximize the number of followers we have. vanity metrics. They’re easy. But how they fit together is often a puzzle. One of the frameworks in our book is The DuPont Model1. And I think that’s a really cool model. But that basic idea — the idea you were alluding to — how the metrics fit together — what drives what — how do we show those connections? It’s great if you’ve got a lot of followers on Facebook. But I can understand why the C-suite would say our job is not to maximize the number of followers we have. No one is that interested, really. You need to show what that’s driving. If we see more reviews, do we expect to drive more sales? If we have a logical chain between cause and effect, then it’s much more convincing to the C suite. Shaw: Let me ask you about this because it truly puzzles me: why is there no specialist role in marketing as manager of integrated measurement? Someone who can confidently answer the cause-and-effect question. Bendle: I’m with you. Some of the analytics is fantastic in marketing nowadays but it often
doesn’t ladder up to higher order business measures, and I don’t know why. Maybe it’s because some of the analytics talent is coming from a data science background and, honestly, are still learning marketing. But it’s a real challenge. I almost wish we weren’t teaching marketing and finance and accounting and operations separately but providing interdisciplinary instruction where you teach all of it at once. But there are lots of reasons why professors don’t want to be interdisciplinary. We just want to be viewed as a good marketing academic in the eyes of our peers — what the other academics think of us doesn’t matter. Shaw: One of the things that MASB has done is a very effective graphic representation of the “chain of marketing effects”, showing the connection between marketing investments and business outcomes. Bendle: That chain is really important. The more marketers think that way, the more they can start thinking, “What I’m doing is going to affect this, and this is going to affect that.” DMN.CA ❰
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INTERVIEW Shaw: I want to come back to the question of brand value which we started off talking about. ISO [International Standards Organization] has now published a methodology to conduct more systematic brand valuations. Will that give marketers, eventually, the framework they need to draw the linkage to business outcomes that we’ve just been talking about? Bendle: I’m really excited about what is going on there. MASB is the representative on the ISO Standards Board. So there’s a couple of big ISO standards that are relevant. There’s an old brand valuation standard, about 12 years old now, which is, if I remember the number, ISO 106682. And that was about monetary brand valuation. I think we can push that one further. To be honest, I think it’s still fairly kind of high level. More recently, a couple of years ago, the Brand Evaluation Standard came out which is 206713, and I think that’s really kind of helpful at getting people on the same page as to what a brand is and what do we mean by a healthy, effective brand. So if we can get international standards on what we mean by brand value, and brand evaluation, then we can start having more credibility when we talk about what a brand is. An international standard setting body has that cachet. Most business people have heard of ISO standards. And so I’m really excited by that work. You can now talk to your managerial accountants about how you start evaluating your brand. Shaw: You aren’t too fussy about the concept of customer equity. Yet isn’t that ultimately the most powerful way we can guide business and marketing strategy? After all, business is in the business of creating and keeping customers. Bendle: It’s not because I don’t think the basic concept is good. It’s a great basic concept. I just want to use the term “customer asset” instead. The reason why customer equity doesn’t work for accountants is that according to their rules, equity is defined as assets minus liabilities. You have an asset, you take away the ❱ DMN.CA
enough to come up with grandiose statements.
I prefer to send the message that customers are an asset and we can justify it.
liabilities, equity is the remainder. You can justify the assets; you can justify the liabilities. The equity is what’s there when you’ve justified everything. I prefer to send the message that customers are an asset, and we can justify it. We can assign a specific value to customers. We can list our customers. We know who our customers are. We know how much they’re paying us each month. We know what their chance of being retained each period is. Once we’ve got that, we can come up with a pretty accurate view of what the value of that customer is. Add those together, and you’ve got a customer asset. There’s nothing magic about it. It’s a really good number. We can go to the accountants and say, “This is a number that you can audit”. It’s a number we can show where our assumptions are coming from. Shaw: Fred Reichheld argues that the only way to crack the code on marketing ROI is to come up with what he calls “earned growth rate”, which really is a way of saying the cross-sell value of a customer combined with the value of a
referral. If you could calculate that, he argues, you can prove the value of marketing. Is he right? Bendle: I think so. I think he’s done some great work. And in some ways, I’m fascinated by him. I don’t know him personally, but I’m fascinated by his work because he’s done such a good job of putting a marketing metric [Net Promoter Score] on the map. So he’s done a fantastic job. But NPS was oversold a little bit, let’s be honest. Don’t believe everything that’s said about it. It’s got some good points, but don’t believe all the hype. I think “earned growth” has some nice qualities. But I’d be surprised if we could just use that one number. Shaw: Byron Sharp argues that expanding market share as much as possible is the path to sure growth, as opposed to focusing on existing customers. What’s your point of view on his contrarian position? Bendle: I always like to see myself as somewhat neutral. And I know that sounds a bit wishy-washy. At the moment, I don’t think our use of numbers as marketers is good
Shaw: Last year, the Association of National Advertisers came out with a study suggesting that marketers look mostly at the wrong metrics. What are the top metrics we should be looking at to know whether marketing is making a contribution to the growth and health of the enterprise? Bendle: In first edition of our book, we didn’t count the number of metrics. We thought it was kind of ironic not to obsess over the actual number of the marketing metrics. But people wanted to know, “These are the 50 plus metrics”. But marketers have to figure out for themselves what’s relevant and important to their firms to measure. And that will show they’re capable of managing the business. Shaw: The central challenge is proving to the C-suite that marketing matters, that the investment is worthwhile. Is it possible to come up with two composite measures, one around the health of the brand, the other around the health of customers? Bendle: Well, that sounds very challenging, but it’s a noble goal. 1. The name comes from the DuPont company that began using the framework in the 1920s to calculate return on equity. 2. ISO 10668: Brand valuation (Requirements for monetary brand valuations) specifies a framework for brand valuation. 3. ISO 20671: Brand evaluation (an integrated framework for brand evaluation).
STEPHEN SHAW is the Chief Strategy Officer of Kenna, a marketing solutions provider specializing in delivering a more unified customer experience. Stephen can be reached via e-mail at sshaw@kenna.ca
JUNE 2022
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TECH
ISTOCK/ GENESTRO
Customer Data Platforms and Why You Need One
BY FIONA HILLARD
Chapter 1: What is CDP? e’ve all experienced it at one time or another – that moment when you took a chance on Spotify’s Discover Weekly playlist, or Amazon’s product recommendations, and they completely knocked it out of the park with their picks for you. Let’s hear it for the customer data platform (CDP). Over the past decade or so, digital marketers have been leaning more and more on the CDP to deliver standout customer experiences. And this demand looks set to continue. In fact, according to the CDP Institute, many organizations are prioritizing CDP investments as they prepare for a post-pandemic world. With a multitude of versions now available, figuring out how to choose a CDP — and more importantly — the right CDP, can be tricky. A customer data platform is a major investment
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and there are several important factors worth considering before you take the plunge and commit to a vendor. Understanding what a CDP is and what it does is a great place to start. In simple terms, a customer data platform is a tool that allows marketers to transform their users’ data into impactful customer experiences. The CDP does this by capturing digital signals in real-time as users interact with channels. It can then predict what customers want based on current and historic behaviors. With the support of a CDP, marketers can activate customer insights for optimization and personalization in any channel and share audiences across their entire ecosystem, resulting in improved alignment across campaigns. But what exactly constitutes a CDP? Well, according to the CDP Institute’s definition, a customer data platform is “packaged
software that creates a persistent, unified customer database that is accessible to other systems”. Chapter 2: CDP Capabilities n Gartner’s Market Guide for Customer Data Platforms 2020, analysts Benjamin Bloom and Lizzy Foo Kune suggest a CDP product should feature a marketerfriendly, web-based interface that allows the following: ❯ Data Collection: The ability to ingest first-party, individual-level customer data from multiple sources, online and offline, in real time and without limits on storage. Data persists within the system as long as it is needed for processing. This includes firstparty identifiers, behaviors and attributes. ❯ Profile unification: The ability to consolidate profiles at the person level and connect attributes to identities. This must include linking multiple
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devices to a single individual once that person has been identified and deduplicating customer records. Some solutions may support thirdparty data matching or aggregating customers into a household or account. Segmentation: An interface that enables the marketer to create and manage segments. Basic offerings support rulebased segment creation. Advanced segmentation features may include automated segment discovery, predictive analytics and propensity models, and the ability to import and deploy custom models built in external advanced analytics or data science environments. Activation: The ability to send segments, with instructions for activating them, to engagement tools for email campaigns, mobile messaging and advertising, for DMN.CA ❰
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TECH example. Marketers still need execution systems for the final mile. Some CDPs have added advanced support for consentbased filtering, suppression, personalization, journey orchestration, A/B testing and recommendations.” How the CDP capabilities work together The CDP offers a 360-degree view of customers by collecting and analyzing first-party customer data from websites, apps, and mobile browsers, as well as transactional data, customer service data, campaign engagement data, along with details such as age, address, and contact info. This data is processed and distilled into specific segments within the CDP, triggering a personalized campaign unique to a particular customer or segment. Ready to find out more about how a CDP can improve your organization? In the next chapter we’ll look at some CDP use cases.
You should also make sure the CDP is compatible with tools that you’re already using such as Google Analytics or social media advertising. In addition, check that the CDP is GDPR and CCPA compliant. This means the CDP should have the capability to suppress data collection or delete customer data when requested.
Chapter 3: CDP Use Cases Before you embark on your CDP shopping spree, it’s worth preparing a use case to pinpoint exactly what you want from the CDP and how you would like the CDP to support and improve your business. Building a use case: Some reasons you may need a CDP: ❯ You have a large amount of customer data, but it’s stored in slow moving or inaccessible databases, preventing you from innovating quickly ❯ You need to join up behavioural (online), CRM, and transactional (offline) data so you can get a 360-degree view of the customer ❯ You want to offer memorable and meaningful customer experiences ❯ You would like to use your own data to inform targeted campaigns on paid media channels ❯ You need to improve your segmentation process
The case for a CDP in a cookie-less world With third-party cookies set to be phased out by the end of 2022, the case for investing in a CDP couldn’t be stronger. Not only do customer data platforms capture and store first-party cookies (cookies that are owned, stored, and dropped by the website domain that the user visits), but they also link every interaction with other channels belonging to the website including CRM, social media, e-commerce platforms, and apps. The CDP acts a central repository for the marketing stack and by gathering omnichannel data, and by merging email addresses, telephone numbers, and other personal information, it improves the accuracy of individual profiles. Rules and algorithms then come into play to determine which information belongs in which profile. The CDP cleans and deduplicates this data, mapping it into single fields to make it consistent. With the single customer view established, the CDP then ascertains customer requirements, communications preferences, and can personalize the user’s brand experience based on details of their previous behavior. With segmentation, specific customers can be targeted with relevant ads or personalized recommendations, based on the behavior of similar users within the segment. As the customer has willingly shared this data, concerns about “creepy” tracking are eliminated, making it much more likely for the customer to engage with your brand, build trust, and ultimately, build loyalty.
Once you’ve decided on your use case(s), you’re ready to research potential CDPs. It’s worth checking if the CDP you’re considering is already being utilized by customers within your industry.
Chapter 4: Types of CDPS epending on your use case and business requirements, your CDP will generally fall under one of the following categories, as outlined
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by Gartner: CDP Engines and Toolkits: These vendors are often described as a CDP toolkit or are available as open source and include feature sets ideal for IT-led teams seeking to build new applications on top of a CDP. Controls over datahandling operations dominate over marketing orchestration, and business users would need substantial lift from SI partners or internal developers in order to take advantage of the platform. ❯ Marketing Data integration: A frequent use case for CDPs is data operations — features that enable granular governance of event data streams from within a marketer-friendly interface. There is some control over delivering segments to downstream marketing touchpoints for advertising activation, but analytics and decisioning must be handled in other applications. Marketing data integration solutions are often chosen for mobile and connected device use cases. Strong real-time use case support dominates in these products over access to historical data. This is often the choice of growth marketers or digital commerce teams. ❯ Smart Hub: These vendors emphasize marketing orchestration and personalization that by nature require both granular customer data analytics and controls for event-triggered and planned campaigns or journeys. The solutions are most likely to fit in a hub-and-spoke configuration that allows marketing teams to focus on sending instructions to execution solutions from a single interface obviating the need to log into several. Predictive analytics, segmentation and whiteboard or canvas-style interfaces for customer journey design are common, and support for real-time offer management may be more suitable for triggered messages than webbased personalization. ❯ Marketing Cloud CDPs: Several enterprise software companies released or announced CDP solutions in 2019, promising to improve the tools that marketing and IT teams already possess. ❯
The inflexible data management and profile unification features of marketing clouds were a major driver of marketer interest in CDPs from the beginning. These new modules aim to shift the integrated suite value proposition to a more open and flexible embrace of enterprise data, leveraging trusted relationships with CMOs and CIOs.” Chapter 5: The Bottom Line he CDP — as recognized by Gartner — takes the marketing and analytics to the next level. This smart hub CDP powerhouse features the solid core data management capabilities of a CDP layered with intelligent decisioning, predictive analytics, experimentation, and orchestration. Let’s take a closer look at how the components work together: ❯ CDP: Data Management Sitting at the heart of the CDP, the data management component is a powerful datacrunching tool that breaks down silos in your organization to connect and streamline your customer data. ❯ Smart: Predictive Analytics and Experimentation During this stage, data is leveraged to predict, test and optimize every customer interaction across every digital channel. By using predictive analytics, decisioning technology and real-time experimentation, the CDP delivers intuitive datadriven customer interactions at every customer touchpoint. ❯ Hub: Orchestration The third step in the process is orchestration. This means delivering the right message to the right person in the right place at the right time, creating joined-up omnichannel experiences for each of your customers. Working together, these three capabilities provide you with a 360-degree view of your customer at every point in their journey, allowing you to offer experiences that will make your customers feel seen, valued, and understood like never before.
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FIONA HILLARD is a content marketing manager with Sitecore. JUNE 2022
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TECH
Six Reasons the Metaverse is Here to Stay A McKINSEY VIEW
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here’s ample skepticism right now from people who think the metaverse is just a flash in the pan. That’s also what some people thought about the internet during the 1990s. But then, as now, one thing was clear: although we didn’t know which companies would shape this new technological evolution, consumers were flocking to it. Increasingly high levels of consumer adoption propelled fundamental change. Similarly, the attraction of consumers to today’s metaverse indicates a major shift in the way people use technology. If the metaverse is another evolution of the internet — something we are already in rather than something we observe from a distance — marketers clearly shouldn’t miss out. Here’s why we think the metaverse has staying power. Ongoing technological advances. Technical challenges must still be overcome for metaverse experiences to be completely mainstream—for example, as a result of technical constraints, both Meta’s Horizon Worlds and The Sandbox cap the number of participants for each session. But constant improvements in computing power allow larger virtual worlds to exist. Cloud and edge computing let intensive large-data processes, such as graphics rendering, move off local devices. The rapid adoption of 5G is enabling mobile devices to access these large worlds more easily and with lower latency. And the cost of production for augmented- and virtual-reality hardware is declining. Meta shipped ten million Oculus Quest 2 headsets in 2021, and new devices like haptic gloves and bodysuits are coming on to the market more frequently as well.
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Major investments in metaverse infrastructure. In 2021, Meta invested $10 billion in the metaverse. Other tech companies have also committed resources to building it—such as the recent launch of the design and simulation platform NVIDIA Omniverse and recent metaverse-friendly updates from Unity Engine, a game developer platform. For good reason, the metaverse dominated this year’s Consumer Electronics Show. More and more companies, large and small, are keen to participate.
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A wider set of use cases. Gaming in the metaverse already has mainstream traction. Consumer use cases are now expanding into new immersive retail, entertainment, sports, and educational
experiences. Then there are the metaverse’s sizable—but less talked about—enterprise applications and opportunities, including virtual employee training and team collaboration with avatars, virtual prototyping in manufacturing and construction, and virtual-showroom displays for products such as cars. Even government entities are experimenting with the metaverse. In South Korea, the city of Seoul announced a five-year Metaverse Seoul Basic Plan that will begin by creating a virtual Mayor’s Office and a Seoul Campus Town.
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Online commerce is mainstream. Already, omnichannel commerce is second nature to most metaverse consumers—payment credentials are often embedded in the devices and software they use. The virtual-goods economy accounts for more than 40 percent of global gaming revenues generated by the world’s billion gamers. In the future, the long-term rise of cryptocurrencies will make any requirements to set up crypto wallet accounts on metaverse platforms less of a barrier. Already we see innovation in both physical-to-virtual and virtual-to-physical transactions, such as ordering Domino’s pizza in Decentraland for deliveries of actual pizza in the real world.
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Demographic tailwinds. The oldest Gen Z consumers are in their mid20s. Increasingly, they are an incomeearning force to be reckoned with. These consumers are more familiar with virtual worlds, transactions, and goods than previous generations are. Gaming is leading the way: 67 percent of Roblox’s 50 million daily users are under the age of 16, which could signal the coming of a whole new generation of metaverse natives.
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Brand marketing and engagement are more consumer led. The shift toward individual content creators is evident in the more than 50 percent increase in influencer marketing over the past five years on platforms such as WeChat and Pinduoduo in China and YouTube and Instagram in the Western world. This shift bodes well for the growth of the metaverse: a significant share of innovative and engaging experiences will probably come from these creator–users.
THIS INSIGHT is from a larger report from McKinsey & Company advisors Eric Hazan of the Paris office, Greg Kelly of the Atlanta office, Hamza Khan of the London office, Dennis Spillecke of the Cologne office, and Lareina Yee of the Bay Area office. JUNE 2022
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