How mass personalization is changing the CMO-CIO relationship

By Gurinder Singh Sandhu, Tata Docomo
Gurinder Singh Sandhu, Head Marketing - Mobility, Tata Docomo1

Personalization is the most influential factor in determining value for money today. According to an industry research, nearly three-quarters of consumers desire personalized products and services and while 90% of surveyed marketers stated that personalization is critical to current and future success.

For today’s customers, personalized, unique experience is essential, rendering the task of logistics, and SKU and stock management increasingly complex.  For example, Tropicana has increased its selection from six in 2004 to more than 20 today, with plans to increase to 30 by the end of the decade; the average US supermarket carries 40,000 product SKUs, that’s a five-fold increase since 1975. Similarly, BMW and Audi have increased their number of models by 83% and 113% over the last decade; today BMW already customizes around 80% of its cars in Europe and 30% in USA. Starbucks has a special secret menu which is a rage amongst youngsters. The knowledge of this secret menu passed by word of mouth has led to immense social media discussion and posts and contributes to the individualized status and taste needs of the young audiences. All these developments are a response to the demand for variety and products which are unique to their purchasers, creating complexity at all stages of the production process from design to fulfilment.

Closer to home, IndusInd Bank offers ‘My Account My Number’–a first-of-its-kind banking feature in India that gives users the freedom, flexibility and convenience to select the account number of their choice. Asian Paints emerged as an early brand to offer personalized color consultancy service for an individualized painting experience.

Technology now owns customer experience as much as marketing

All these developments are a response to the demand for variety and products which are unique to their purchasers, creating complexity at all stages of the production process from design to fulfilment.  But none of these offerings would have been possible without a new type of relationship between the companies’ CMO and CIO functions. Traditionally, the latter was regarded as an internal supplier to the former – marketing created the demand, the technology team endeavored to fulfil it.  Mass personalization – and the opportunities created by the availability of big data – have transformed this relationship into a genuine partnership; and one which is starting to drive the bottom line.

According to Accenture’s latest annual survey, 69% of CMOs say that they need to align and interact better with their technology counterparts on their strategic priorities; (compared to just 56% in 2012); while 83% of CIOs surveyed revealed a need to align and interact better with marketing (77% for 2012).  Once again, the driver for this is not merely internal integration, it is the bottom line – close collaboration between marketing and technology teams makes business sense.

Successful customer engagement and fulfillment thus includes finding ways to allow consumers to customize products to conform to their needs and personal preferences.  Both technology and marketing functions are now ‘customer-facing’, both can directly impact customer experience, loyalty and – in competitive sectors where customers can switch suppliers with impunity, at zero cost – revenues. Whether or not digital (social) marketing ultimately will outstrip analogue (traditional) marketing spend as a result is open to question – Gartner estimates that this point will be reached by 2017 – but a deeper collaboration between the roles and objectives is now irreversible.

Big data driving new forms of collaboration

Big data – and the ability to identify and respond to customer insights – is the real catalyst for drawing these two departments together; it is particularly compelling for challengers operating in highly competitive markets, and Tata Docomo is no exception. We are able to draw insights and preferences on all aspects of our customers’ behaviour against hundreds of different criteria ranging from handset type and data usage, to re-charge preferences and roaming activation.  We can then translate this into a personalized experience – not merely covering the subscription package itself – but all aspects of engagement from tailored offers to individualised customer support.  Considering our scale, covering millions of subscribers, a solid relationship between the CMO and the CIO is right at the heart of it.

Millennial consumers are driving the trend towards personalized products and experiences; but for tomorrow’s ‘post millennial’ customers this will just be a starting point for consideration; unless it’s unique, they’ll immediately look elsewhere.

This environment requires technologists to become more aware of consumer trends and tastes and how they can be fulfilled; it also demands that marketers consider the technical and infrastructure implications of their campaigns. Today, both departments are well and truly customer-facing and driving customer experience; for this reason, the best CMO-CIO relationships are no longer customer/supplier-based but genuine partnerships.

The author is Head Marketing – Mobility, Tata Docomo