The CMO Show: Linden Brown on customer centricity in marketing

by Megan Wright

As we move into an era of user-generated content, customer supply chains and individual consumption, the age old adage “the customer comes first,” has never been more true.

Without your customers you’d be out of business faster than you can say the word customer. But somewhere along the line we lost sight of why customers are so important and how to connect with them.

In this episode of The CMO Show, Mark and JV are joined by Linden Brown, the man who wrote the book on marketing (he actually did – it’s called Marketing and you can read all about it here).

With more than three decades of experience practicing and teaching marketing around the world, Brown shares his insights into a new paradigm for the global marketing culture, the Market Responsiveness Index. Today, as chairman and chief value officer at MarketCulture Strategies, Brown is pioneering a new frontier in marketing that is customer centric and insight-led.

“Marketers have always had a view that we should be focussing on the customer,” he told Mark and JV.

“The thing that is so important in marketing today is that everything that CMOs and marketing people are doing should be customer-insight or customer-foresight led.  And by that I mean it should be based on some real knowledge around the customer’s need or their future need and building campaigns actually around that.”

Tune in to discover what customer centricity really means, and how it is defining the future of global marketing.

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The CMO Show production team

Producer – Megan Wright

Audio Engineer – Jonny McNee

Design Manager – Daniel Marr

Graphic Designer – Chris Gresham-Britt

Got an idea for an upcoming episode or want to be a guest on The CMO ShowWe’d love to hear from you: cmoshow@filteredmedia.com.au.

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Transcript:

Participants: 
Jeanne-Vida Douglas (JVD)
Mark Jones (MJ)
Linden Brown (LB)

JVD Hey Mark.

MJ    Hey, how’s it going?

JVD Not too bad, not too bad.  What’s your favourite customer service story?  What’s the – where do you get the best customer service?

MJ    Well, it’s funny you should ask JV because I’ve been thinking about Uber.

JVD I caught an Uber last night.

MJ    Did you, well done, what was it like?

JVD It was awesome. Waleed, and he was having a chat to us about how much he enjoyed – enjoyed being an Uber driver.

MJ    And so that’s the thing is that if you meet an Uber driver – this is what I’ve found – you ask them “Is this your full time job or your part time job?”  And then before you know it you’re having a life conversation.

I think the customer experience side of things is interesting because it’s been pushed out of the app, we have this environment that’s created between the – the customer and the service provider and you’re rating each other which has been discussed ad nauseum…

But I think the interesting part of that is that it facilitates a relationship where you’re kind of looking after each other.

JVD It’s like the evolution of the franchise model right?  Because a franchise – a franchisee in the franchise model is actually closer to the customer than the franchisor.

MJ    Right.

JVD Now in a sense, the Uber driver – and we were actually talking about this last night because we were talking about the service that the – that Waleed gets from – from Uber.

So he’s actually Uber’s customer, and we’re his customer.

MJ    Yes, his customer’s customers.

JVD And that makes a big difference.  Because he’s looking after us directly.

MJ    But I think if we think about ourselves as the end customer and how Uber has created an environment that is very transparent and very open and honest, there’s a level of integrity there that you just can’t escape.

So I think it’s a really interesting story as we think about our show today and we think about customer service and customer experience.

JVD Well, that’s the thing because the competition really is, in terms of customer service because a lot of people talk about the way Uber’s come along and Airbnb have come along and they’ve stolen the business model out of the hotel industry and the transport industry.  What they’ve really stolen is that customer service element because that’s what those industries were not delivering.

MJ    So Linden Brown is our guest today and tell me about him?

JVD Linden Brown wrote the book (laughs)…  in fact a lot of…

MJ    Don’t you love that.

JVD A lot of people listening will – will probably have had a great big marketing tome called Marketing…

MJ    No.

JVD …with his by-line, yeah, absolutely.  And more recently he’s become really, really interested in this whole sort of customer service approach and customer experience approach to marketing.

MJ    We’ll let’s have a listen to Linden Brown and hear what he has to say.

JVD Absolutely.

JV: We’re here today with somebody who many of our listeners will recognise and probably may have sat through his classes at some stage.  It’s Linden Brown.  He’s the chairman and chief value officer of Market Culture Strategies and a long-term academic and business partner for many marketing organisations around Australia and the world.

Thank you for joining us.

Linden:    Pleasure.

Mark:   One of the great things about your own history is that you literally wrote the book, on marketing.  How much has marketing changed since the first edition was published?

Linden:    I think it’s changed a lot but where the changes are really are in how we do marketing.  So those changes, such as digital marketing today, one-to-one, you know, more personalised marketing, the use of big data and data analysis to understand customers, all of these things are new and they help marketers do things differently. Another one, of course, is the empowerment of customers, which has forced marketers to do things differently and to really think about a two-way conversation in the whole marketing environment.  So many things have changed but there’s one thing that hasn’t changed and that is that the whole philosophy of marketing, which, you know technically, at the University we talk about as market orientation but in business we talk about it today as customer experience and customer-centricity.

That hasn’t changed because marketers always have had a view that we should be focussing on the customer.

JV: What strikes me as interesting, too, about, I guess, your opening comments is that the two trends you identified were essentially around digital transformation and the different delivery mechanisms that marketing now has to get to the customer and this renewed focus on customer-centricity.  Can we drill down into the marketing departments of organisations around the world right now?  How are they approaching digital transformation and how are they getting that skills base into their workforce to ensure that they can actually deliver via these mechanisms?

Linden:    You know, I think that the thing that is so important in marketing today is that everything that CMOs and marketing people are doing should be customer-insight or customer-foresight led.  And by that I mean it should be based on some real knowledge around the customer’s need or their future need and building campaigns actually around that.  There’s a very good example in the Bank of New Zealand…

JV: Yep.

Linden:    …where the head there of digital marketing, the whole digital area of that bank, is a very, very customer-centric leader.  And, you know, what he did was, he went out to the customers around, you know, the website and how do you deal with money and he found in their research, both in talking to customers and analysing their behaviour through data and so on was that they thought of money as being in pots.  So there was a pot here that was for education, there was a pot here for travel, there’s a pot here to cover the mortgage and so on.

And so they worked with customers to create pots that people on the website could move money from one pot to another just with the cursor and that was transferring money in and helping customers plan their own personal finances.

Now, what he did was to really build a team with that kind of mindset that we’re here to help customers benefit in the way in which they manage, control their money.  

Mark:   It’s a really interesting example because it shows what you can achieve if you put yourself into the customer-centric perspective.  But I wonder what actually holds a lot of companies back?  

Linden:    One of the big inhibitors, I think, is lack of tangibility as to what a customer-centric culture actually is.

So I think in our research, we’ve found that there are some very tangible dimensions around customer-centricity that you can make specific and you can make real for customers.  And I mentioned a little bit earlier about the need for customer insight and foresight around future customer needs as being important drivers of marketing strategies and campaigns.

You need to set expectations of what people should do when they’re interacting with customers, how they go about solving problems, how they go about caring for customers and so on.

JV: Now, you use a couple of terms there, customer insight and customer foresight.  Can you tease that out a little bit?  What are you referring to and what’s the interplay between them?

Linden:    Customer insight, in my perspective, is about understanding your existing customer’s needs and the value that they expect and want from your product, your service, from your connection with your organisation.

And a lot of the insights that companies have developed – Westpac, for example, made a major change when they really went out and asked customers why did you leave and also why did you stay.

And, you know, the difference there was, “Well, I left because I hate the bank.  I stayed because I love my banker.”

JV: So it’s that personal interaction that’s so important.

Linden:    It’s the personal interaction.  Immediately, as a result of that, they decentralised the bank and the decision-making and the empowerment of branch managers to make decisions with and for customers but it came from that particular insight.  

Customer foresight is really thinking about what the future needs of future customers will be and gaining some sort of insight as to what we need to prepare for now to create value for the future that we’re going to meet future needs.  Probably a good example of that would be Starbucks.

Now Starbucks were really one of the first of those kind of chains to introduce mobile ordering and mobile connection.  And they did that seven or eight years ago.

And so they could see something coming here and it’s created tremendous customer loyalty. So, you know, you can have my coffee ready for me when I get there in five minutes.  Boom, it’s there.

So it’s thinking from a future perspective and being ready to deliver that value for the future but work on it now.

JV: What are the sorts of approaches that business leaders, not just marketers, can use to get closer to the customer because, I mean, I’ve got this image of David Thodey in the call centre when [laughs] – in one of Telstra’s, sort of, let’s get close to the customer push.  And he was, of course, a very customer-focussed leader and really changed Telstra’s culture around that.  I’m just wondering what are some of the other examples of large companies actually culturally shifting to a customer-centric focus?

Linden:    There’s a good story around David Thodey’s leadership of this.

You know, when he was asked, when he took over the CEO position, you know, “What do you want to be known for as the CEO of this company?” he said, “I want to be known as an agent for the customer.”   So immediately that was kind of a differentiator and a story around what he was going to do.

And the story is that he was there – he told me this personally, that he was there with his top people and – you know, 15 of them or something in the senior team – and they were decided that one of the things that they would do is each of them, each month, for the next six months would call a total of six customers each month.  Three of those customers would be customers that rated them very highly on the net promoter score, nine out of 10 or 10 out of 10, and the other three would be where they’re rated very low.  And they had a meeting, he told me, where they all came back and, “Well, what have we got, what has been your experience?” he said.  One of the directors said that – “Well, I’ve had an interesting experience.  I called a 10 out of 10 customer and asked that customer, you know, why did you rate us 10 out of 10?”  “Well”, he said, “It was a fantastic experience, worked beautifully.  I just couldn’t fault the experience.  I’ve given you a 10 out of 10 for that particular reason.  Everything was just right, as I expected.”

And before he left the phone call, he said, “Is there anything else I could help you with?”  And he says, “As a matter of fact there is.  I had another experience just recently where I went in with my wife to get a new phone in a Telstra shop, a two-year contract, and signed it, got it done and then a week later, my wife died.  I went back to the shop and said, “Look, I’ve got this contract, it’s not needed now”.  And they said, “Well, look, we’re terribly sorry, you know, it’s a legal contract, we don’t feel as though we can do anything about that.  We have great sympathy for you but I’m afraid you’re stuck with it.”

And, at that point, David Thodey stopped the meeting.  He said, “Well, you know, what do you think we should have done?”  And the person said, “Well, you know, I’m not sure.  There’s a process there and, you know, this is what, you know, they’re told should happen.  Once a contract’s signed, it’s signed.  It’s a legal document.”  And then he said, “Well, what if it had been you, what would you liked to have happened?”  He said, “Well, I suppose they should have, you know, torn up the contract.”  He said, “Well, why didn’t we actually do that”…

JV: [Laughs] Yeah, exactly [laughs].

Mark:   [Laughs]

JV: We mentioned earlier on the notion of, I guess, a skills gap in the technical sense in terms of new technologies.  What’s the skills gap in terms of customer insights because I know a lot of the techniques are really quite new.  So if we’re talking about, sort of, design thinking and that type of approach, is that really where the skills gap is as opposed to in that technological space?

Linden:    I think you’re right.  I think there is a skills gap there.  I mean, I think that – and it’s not only technical skills of knowing how to read data, of knowing how to interpret what customers are saying but it’s – it’s, you know, personal experience in actually doing that because a lot of that knowledge actually comes from personal experience.  

But I suppose the implication for marketers here is that we need to look around the world at where there are industries where those skills exist.

So you’ll find it in companies like, you know, Google – they’re really paying for and capturing people that have skills in these areas of gaining insights and they’re training them and they get experience there.  We need to look at a global market to be able to fill that skills gap.  And I – and I think that insights also can be gained by looking around the world, not only at your own industry but at other industries and what people are actually doing.  

Mark:   Another angle on all of this is this concept of you take care of the staff first and then the customers will be happy.  The person who really got me thinking about this, quite famously, would be Richard Branson who says you look after your staff and then they will, in turn, keep the customers happy.  So in that dynamic, which one’s right and which one’s wrong?

Linden:    I think you need both but I think the most important focal point is the customer and there are a few reasons for that.  I was actually talking to a consultant yesterday who told me of a study that was done in one of his clients where they had very happy staff.  They were highly engaged.  Everybody was working collaboratively together but the business was going out of business.

JV: [Laughs] Right, there’s something wrong here.

Linden:    And so the focus was not on the customer, it was on something else.  It was internally focussed.

A lot of things going on outside affecting customer behaviour, perception of value by customers and they were simply losing business but everybody was very happy and they were probably well paid.

But you have a situation I think where you have to have a strategy that’s customer-focussed today to be able to change and adapt and then have alignment within the business where you support the people, you look after them.  They are feeling happy, they will then transfer that on to the customer but the customer really is the focal point.  

I think you need to learn from very good customer experiences which are reported back by the customer and also bad ones.

Mark:   So I asked my sister-in-law why she has a Lexus and she said, “The customer service is amazing.  So they come and pick up my car when it’s due for a service.  And, by the way, the service is paid for under, you know, my warranty agreement or whatever it might be.  Plus, also, when there’s my birthday, they send me chocolates.”

JV: [Laughs]

Mark:   And, you know, so the feeling and the experience of owning a Lexus is obviously well beyond the purchase moment, right?  It’s an ongoing experience and they work to effectively look after your emotions.  Now that’s one example and I’m not advocating them over any other brand in that space but I think it’s a pretty salient point is that how in touch with the feelings and the emotions of your customer are you as an organisation?

Linden:    And I think that I would agree that it is the next phase.  We’re starting to see customer experience associations developing around the world.

And there have been some examples in Europe, for instance, where families have been caught in the French Alps in a snowstorm and Lexus have actually sent in a helicopter to bring the family out and get them to their destination.  Now that’s a demonstration of it’s about the customer’s journey.

It’s about the customer’s experience.

It’s not about the car.

Mark:   Linden Brown, chairman and chief value officer at Market Culture Strategies, thank you for joining us.

JV: And thanks for sharing so many great stories.

Linden:    A great pleasure.  Thank you.

Mark:   All right.  Rapid fire 21 questions.  How are we going to do this?  We’ll, do it like a tag team?  You start [laughs].

Linden:    Absolutely.

JV: [Laughs] What are you grateful for?

Linden:    I think probably my parents.

Mark:   Do you like rain?

Linden:    I do like rain.

JV: [Laughs] In the movie of your life, who would play you?

Linden:    Gladiator?

JV: [Laughs]

Mark:   Nice.  Beach or mountain?

Linden:    Beach.

JV: Greatest career fail?

Linden:    Probably not moving fast enough in certain areas of knowledge.

Mark:   Chocolate or strawberry?

Linden:    Chocolate.

JV: Best ever career advice?

Linden:    My father. He said, “Linden, you need to be in something that’s in demand.”

JV: [Laughs].

Mark:   He’s a wise man.  Summer or winter?

Linden:   Summer.

JV: Who is your hero?

Linden:    I think probably Richard Branson.

JV: [Laughs]

Mark:   Scrunch or fold?  Scrunch or fold tissues, hankies?

JV: Toilet paper [laughs]..

Linden:    Can’t answer that one.

JV: [Laughs]

Mark:   That’s a no comment.

JV: [Laughs] If you weren’t a marketer, what would you be?

Linden:    Probably a – an adventurer.

Mark:   What did you have for breakfast?

Linden:    Muesli.

JV: What would you rather have had for breakfast?

Linden:    Eggs and bacon.

Mark:   Last conversation with your parents, what was that?

Linden:    I think it was a conversation with my mother around gratitude.

JV: If you could change one thing about the marketing industry, what would it be?

Linden:    Become much more innovative and customer-centric.

Mark:   Can you ride a bike?

Linden:    Yes.

JV: What’s your greatest frustration?

Linden:    Getting the word out around being, I think, a customer-focussed leader and what it involves.

Mark:   Dogs or cats?

Linden:    Dogs.

JV: Touch, taste, sight, hearing, smell, which would you sacrifice to save the rest?

Linden:    Smell.

Mark:   Favourite book?

Linden:    It’s called Consilience and it’s about bringing knowledge streams in all areas of knowledge together.

Mark:   If you had to change your first name, what would you change it to?

Linden:    [Laughs] Tony.

Mark:   Thanks, Linden.

MJ    Well that was fun, Mr Linden Brown, the man.

JVD Who’s – who’s always been that by-line on the textbook and now suddenly he’s like – he’s so human and so wonderful.

MJ    Twenty-one questions, how fun was that?

JVD Absolutely, we’ve got to do that again.  Yeah?

MJ    Yes, we should do that and if you’re listening to the show, well because you are because obviously listening right now but if you’re a subscriber and you have just discovered this thing, we want to know what you think.  You know, give us your feedback.  

MJ    So – so do that.  Filteredmedia.com/thecmoshow.  We also love your reviews on iTunes. You can jump on there and send us an email.

JVD So many ways to contact us.

MJ    So thank you very much it’s been great, we’ve enjoyed today, thank you for listening.

JVD Until next time.

MJ    Bye, bye.

 

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