The rise of the Chief Customer Officer


Who controls the customer experience in your business?

When superannuation group Mercer appointed Renee McGowan as its first Chief Customer Officer in 2013, it brought together all customer service functions to shift its marketing approach from creative communication campaigns to personalised customer experience – and business ROI. With a transformation of the processes behind that experience, the average time-to-sale across the business has been reduced by 75 per cent

In corporates around the world, the Chief Customer Officer (CCO) is emerging as a strategic leader with a broad remit. By 2014, almost 25 per cent of Fortune 100 companies had a dedicated CCO. But is this now an essential C-suite role for smaller businesses?

“When I looked at our database, only two small or mid-sized companies have a CCO,” comments Derek Laney, Head of Product Marketing Asia Pacific for Salesforce. But that doesn’t mean they’re falling behind on creating a customer-centric culture. “In these businesses, it’s the business owner or CEO who now leads the customer experience initiative.”

For example, buyers’ agent Cohen Handler is the customer advocate in the property market. “Cohen Handler’s CEO, Ben Handler, has the vision to empower their agents with tools and knowledge, so they can be trusted advisors providing simple choices to clients in a high touch engagement,” explains Laney. “Whereas Life Sherpa has a more automated approach as a wholly online financial planner – they focus on personalisation at scale.”

A CCO is responsible for making sure the business actually delivers on its brand promise at every moment.

Life Sherpa’s CEO Vince Scully is fully focused on connecting with clients who might not otherwise be able to access financial advice. Personalised lead nurturing means capturing every interaction to get a single view of the customer, and their full financial profile.

What does a CCO actually do?

As Sam Walton famously said; “There is only one boss. The customer. And he can fire everybody in the company from the chairman down, simply by spending his money somewhere else.”

With control of the buying cycle firmly in a customer’s hands today, that has never been more true. PwC’s latest Global CEO survey revealed 90 per cent of CEOs1 believe customers have a high or very high impact on their business strategy.

As the function closest to the needs and wants of the customer, the CCO controls every touch point they have with a business – from customer-facing staff to the website, communication channels, call centre or retail outlet. As such, it brings together many areas of the business: sales, marketing, customer service, IT and even HR.

In the past, that role may have fallen under the IT department (improving the digital user experience) or marketing (creating a brand promise that will resonate with customers). Today, a CCO is responsible for making sure the business actually delivers on that brand promise at every moment.

Given its strategic importance and holistic approach, it makes sense to elevate responsibility for customers to a C-suite level. But how does that work in practice?

Empowering staff to create real customer value

“A CCO will be typically put in place to resolve some structural tension in a larger business, to be the customer trailblazer” explains Laney, citing Christine Corbett’s role at Australia Post as a good example.

“Christine brings a broad understanding of customer experience from marketing but has a wide remit across customer service and operations as Post’s revenue model is reshaped by digital technology and shifts its focus from a customer service focus to a customer experience focus.”

As Corbett told the audience at the Salesforce Future of Marketing conference in August, “we’re proud to say we are a customer service organisation, but even that word ‘service’ is coming at the end, not the beginning. The creation of a chief customer office is saying we need to start with the customer.”

The CCO creates the brand promise, personalises the information customers need, and shows how the business delivers on that promise.

A Chief Marketing Officer’s role might focus on maximising revenue. As CCO, it’s more about providing convenience, control and choice to customers. For Corbett, that means making a ubiquitous brand much more personal.2

“For the next 12 months, Christine is focused on two priorities,” says Laney. “Personalising products and communication to make customers more ‘sticky’. And empowering frontline staff to respond to queries on the spot.”

A new approach to the customer journey

“Traditionally, professional services revolves around customer acquisition, service delivery and then the re-pitch (or retention) process,” explains Laney. He suggests making a four-stage customer journey the CCO’s responsibility instead:

  1. Finding customers – what is the brand promise you’ve created
  2. Resourcing – allocating knowledge and human capital
  3. Delivering the product or service – effective engagement management, collaboration tools 
  4. Measuring the work – metrics at each stage to see how you’ve delivered on that brand promise.

“If you think about this life cycle, the CCO creates the brand promise, personalises the information customers need, and shows how the business delivers on that promise,” says Laney.

He says McGrath Estate Agents does a good job automating its communications with ‘out of cycle prospects’ for step one. “My local agent tailors property reports to focus on similar homes to what I’m looking for in my area, for example.”

For step two, it’s important to put the resources in place to deliver your brand promise. “Cohen Handler has a collaboration platform to share knowledge within its network,” says Laney. “To do this you need real relationship intelligence.”

At scale, technology also allows every consultant or adviser to learn from the business’ best practice approach in step three. “For example, Accenture talks about ‘delivering Accenture on its best day, every day.”

The fourth step is crucial for retention. By demonstrating value throughout their experience, you can save on time and resources re-pitching.

“At Salesforce, we have a role called Customer Success Manager. They report back to the business and set joint plans with customers to ensure a successful program. This also gives us an early warning system: we can identify risk from user adoption data, for example, and see how likely it is that a customer keeps using our service.”

It’s all about the experience

The key to a CCO’s success is investing in an exceptional customer experience across all areas of the business. This single-minded focus all but eliminates the need for retention campaigns or short-term acquisition tactics.

For Laney, this is why a CCO’s responsibilities can’t be delegated to either marketing or sales functions.

“It has to be the CEO or business owner. Or, you can appoint a CCO to oversee sales, marketing and customer service, and have a COO for operations to take care of the back office. But it needs to cross all these functions.”

Ultimately, it doesn’t matter so much who owns that job – as long as a business has the capabilities in place to unite all operational functions, and bring the leadership team together to focus on the most important people in your business: your customers.

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This material has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL & Australian Credit Licence 237502 ("Macquarie") for general discussion purposes only, without taking into account your personal objectives, financial situation or needs. Before acting on this general information, you must consider its appropriateness having regard to your own objectives, financial situation and needs. The information provided is not intended to replace or serve as a substitute for any accounting, tax or other professional advice, consultation or service.