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Market Movers How Brands Can Come Through Uncertain Times Smarter & Stronger

Retailers are feeling the squeeze. In this insightful discussion, Ometria’s Chief Marketing Officer Michelle Schroeder shares practical insights on how Ometria advises their clients to tackle reduced budgets, shrinking resources and uncertainty to come out ahead with stronger financials and deeper customer relationships. She shares her perspective on why batch and blast approaches don’t work, what the modern CMO is really managing, and why less is more. She also touches on Ometria’s 7 predictors of growth, and why focusing on your existing customers and data will pay off big.

Transcript

Erin Raese:

Hi everybody. I'm Erin Raese. Welcome to another edition of Market Movers. I'm here today with Michelle Schroeder, the CMO of Ometria. Welcome Michelle.

Michelle Schroeder:

Thank you. Thank you. Great to be here.

Erin Raese:

So, why don't we get started and why don't you tell us a little bit about your role at Ometria? What Ometria does? Yeah. And what you guys are doing these days?

Michelle Schroeder:

Awesome. Well, as you said, I'm Chief Marketing Officer of Ometria and we're proudly partnered with Annex Cloud. I've personally been in and around the MarTech space for the majority of my career. So, using consumer data to drive marketing experiences and really quick, just a little bit about Ometria before we get into it. And also... so you have a sense of the advantage point I'm coming from.

Ometria's platform helps marketers essentially unify all of their customer data, understand it, and use it to orchestrate out and deliver those experiences that customers love. And that's essentially what we do. And I'm really excited to be here talking about this squeeze that a lot of retailers like prospects, clients, the entire retail space is feeling right now and hopefully have a great discussion.

Erin Raese:

Terrific. And that's where we're headed. What's going on in the world right now, and how can companies be more proactive to help themselves? We're obviously hitting a time that everyone's talking about with recession, but we've also been struggling for a long time with COVID and supply chain issues. And I know for one, we keep talking about this, you need to know who your customer is right now, right? And so, yeah, we'd love to hear what you guys are hearing and how you're helping your clients through this?

Michelle Schroeder:

100%. And it's interesting because some of the squeezes that I think retailers have felt started a while back like supply chain issues, for example, which started during COVID. And a lot of the responses that retailers have made in response to digital transformation and all of the things that they needed to do to be resilient to COVID, yes, it definitely sped up the process in some ways.

There was a huge acceleration of digital maturity, but it also introduced a whole bunch of debt inefficiency, some overlap. And that's one thing just coming at this from a technical perspective is just seeing some of that feature overlap and that redundancy and only using a small percentage of a platform that you added to your retail stack, but you're paying full price for it.

And so part of it, part of our role here is just being able to see it from a rightsizing perspective, just wanting retailers to have a stack that supports the actual outcomes that they're trying to drive and an investment that's matched to that desire and to that goal.

So that's one thing that I think we can probably get out of the way because it's a complex and hairy thing, but just something that I think is overlooked a lot when we talk about supply chain issues and inflation, and consumer sentiments, and how people are spending and understanding that buyer.

Part of it is the tech you have underlying and supporting you in your ability to do that. And there have been a lot of missteps or not last mile polishing of those decisions. So that's one thing and we can definitely visit, if it's interesting, I'm sure you've seen a little bit of it too, as a vendor in this space.

Erin Raese:

No. And I think that's actually really... I know I do have other points, so I won't belabor this, but I've been in conversations where we're talking about that, if there are some of those systems that people aren't using or aren't using to the capacity.

So, how do you make that decision if we go deeper into this or maybe we drop this one and then freeze this and freeze up budget for something else that maybe today is going to be more important?

Michelle Schroeder:

Yeah. Well, I mean, the other thing too is how flexible and agile are the systems that you put in place to support the problems that you had a few years ago, if those have changed and your tech isn't flexibly adapting to the new challenges that you have, it's probably the wrong tech. And so that's definitely a whole other can of worms, but the other big areas, you talk about tech stack efficiency, tech stack ROI, and just making sure that foundation is correct.

It's the same kind of thing when you think about revenue efficiency. So, obviously as a customer data and marketing platform, we're not going to influence your supply chain. We're not going to influence the margins on your products, but what we can do is increase marketing efficiency.

So, it's one of the big areas that we believe are in retail marketers' hands to really influence and help them build up that resilience in this time of just total economic uncertainty. And so, there's a whole lot of ways in which you can influence that. And probably the biggest next point is focusing on the high impact customer experience areas that you have within your strategy.

Those big opportunities that you have within your marketing program and strategy that can make sure that you come out ahead and that you understand your consumers and you're delivering the right types of campaigns for them. And then, probably one of the darker points, but ones that we've already seen start to emerge are mitigating the impact of reduced resources.

So, budget squeezes, budget cuts, teams that are being consolidated or shrinking, or your supporting teams, your IT teams, your data engineering teams, the ones that help you pull those segments and help you bring in the data that you need. What do you do when those things go down, but you're expected to do more with a dollar?

And these are questions that we're already starting to be asked by our clients and by our prospects and by the market and ones that we are starting to form answers for, I can't say we have all of them, but we're starting to see patterns of clients that are coming out ahead already.

Erin Raese:

Terrific. Yeah. As you were talking on number two, so how as a marketer do you know? I mean, okay, easy to say, go focus on the thing, go focus on certain things, but what are those certain things and how do you identify what those high impact pieces are? And then certainly level side if you don't have the resources either, I think that almost is cyclical then, okay. If you don't have the resources to help you, then you better go figure out which ones are those high impact. So, how are you helping people understand that?

Michelle Schroeder:

Exactly. It's actually the question, if your analytics team, your insights team, your own insights tooling, the ones that you would use to build that strategy from or understand your consumer better than your competitors do, if those things are being reduced, how do you actually prioritize? How do you figure out what those big opportunities are? And from our perspective, it's this ... sounds strange … blend between human and machine.

We know your challenges because you've told us in these quarterly business reviews, or you've told us because you're noticing a drop in engagement or you're seeing as a retail marketer the effects of lowered consumer spending, but you're not seeing it everywhere. And you know that your consumer's different, that you don't just have one aggregate blended view of a consumer.

And so, from our perspective, it's really about those insights that having a unified data platform with some level of intelligence built on top of it, teasing out those opportunities and teasing out those segments that work. And just making sure you're asking the right questions of your data, so that you can pull up the insights that you need.

And so that sounds pretty generic, but for us, we got for example, a client asking us to pull in data from their ecommerce. Their ecommerce platform told them about the cost of goods and their questions, we were like, "Oh, that's a really interesting question. And it's very possible." Why are you asking this of your data? And they said, "Well, we're not profitable in all of our products."

And so, when the CRM team goes and they apply a discount to this product set or to this group, it squeezes our margins worse than the way that they were before. And we need a way to think about this and action on it and why not directly within the marketing platform.

And so, it's one of those things that from just a pure MarTech perspective, we wouldn't necessarily think of, but then you get into these types of periods of economic contraction, where people are asking really great questions of their data and you need to answer it and you need to answer it in real time.

And then, there needs to be some layer of intelligence that just helps them move faster on whatever the action is that they need to take off of that insight.

Erin Raese:

Yeah. I love that example too, because the more we said, in talking about loyalty, we get all of this data. We know who's purchasing what? We know what's in their basket? But we don't often see somebody taking that, your cost of goods sold, the margin aspect and laying that over the top. You also don't see a lot of connection between the marketing initiatives and merchandising.

So, I think there's a lot to be done there, especially with the supply chain issues now. What do we have? What's stuck on our shelves? Who's bought that before? What can we do? Can we bring these people together or do something that way? And then, you'd be adding the margin overlay to it. It's "Hey, we can give a discount here, but we can't give a discount here."

And maybe these people, it's too tight. And so this is just in... this is always going to remain full price and that's a reality. So, you find some additional value. That's the customer's best items and things like that.

Michelle Schroeder:

I love that point. And actually it made me think of some really great advice. I saw in McKenzie give earlier this month to retailers actually earlier in June, where they said that it's great to put together this cross-functional. I think they called it a win room.

So, the same way you'd have a war room, right? But a cross-functional win room, thinking about how you respond to the situation that we're all in. And how you think about it from a cross-functional perspective. If you just think about the process of buying technology, for example, start with a challenge.

And then, this group of stakeholders come together to figure out like, "Do we need a customer data platform? And what do we need it to do?" Everybody's coming at it from their own angle, but the second you all get into a room and you say, "How are we actually going to measure ROI for this effort, that we're all rolling up our sleeves and participating in?"

That's where you get some really, really interesting outcomes. It's also probably where you lose hours and maybe your voice debating different angles of things. But just thinking about getting merchandising to what you just said, getting merchandising in the room, when you're thinking about your program, your marketing strategy, when you're thinking about how you're going to come out ahead and what your brand needs to deliver?

What emotional resonance you need to do as a company to come through this period and make sure that each of your consumers, whoever they are. And however they feel about putting money toward your brand, come out of this feeling stronger, feeling that connection being bolstered by the messages that you send.

I think that's it ... again it sounds really easy and obvious, but it's really, really hard. And I think it takes a lot of different voices and a lot of different minds.

Erin Raese:

No, I agree. I love that. I'm going to take that back and I'm going to use it. We can create win rooms.

Michelle Schroeder:

That's so much better than war room too. I really like it.

Erin Raese:

Yeah. I think it's really great. So, are there companies you're seeing today already institute some of these things? Or, yeah, I guess that's my question is, are some people doing this already or do we need to get out there and start teaching for both?

Michelle Schroeder:

We're starting to see, so we're in the questions phase I think still where ... I'm not an economist. I don't know. I feel like I read recently that we're in a technical recession, but there's still some back and forth about how serious this is going to get.

So, we're still in that phase where there's not a lot of panic, but people who are looking at engagement rates dropping or traffic to the site that used to be delivered beautifully by their journey building, by their email journeys and SMS and all the stuff that used to just drive sales.

They're seeing these little minute changes. And I think our customers, our clients in particular are very sensitive to those changes, which is great because it gives us a chance to intervene, and think, and manipulate the data, and manipulate the strategy to what's going to work.

And really we've been giving a lot of guidance around these small changes, these small improvements that you can do that will have an outsize and positive impact. So, we have this report that we recently published and we're updating it based off of new engagement, recession data, but it's called the seven predictors of growth.

And it's these things that might be connected in a lot of very mature CRM organizations, but things like increasing your repeat rate by a certain percentage and the impact that's going to have on your overall revenue and what we see within our existing client base.

Time to first purchase things that don't feel super influenceable by a tech platform or by your strategy, but when you actually focus on it and you focus on driving that first purchase faster, especially in times like these, it just starts the relationship. It starts the clock, I think, on that loyalty much faster.

Erin Raese:

Yeah. Well and good for sure. Yeah.

Michelle Schroeder:

Yeah. And then customer loyalty too. I mean, you know this as well as anyone, but it's the thing that you focus on, in these small ways that just have a massive impact in the long term of your business. And so, clients that are asking questions like that are coming out ahead. Yes, we have several of them that we know are going to come out of this very, very resilient, just because of how sophisticated the questions they're asking and the things that they're focusing on. And not doing too much too, which is a big thing that even we need to take to heart, I think as marketers.

Erin Raese:

The whole case, keep it simple, right?

Michelle Schroeder:

Exactly.

Erin Raese:

Well, I love what you're talking about. I was curious when you were talking about some of the data points. In loyalty, we talk a lot about customer lifetime value, and we talk about recency, frequency, monetary value, the whole RFM piece. I'm assuming you guys do too, and helping customers to understand who falls into which of those areas and being able to map when somebody might be close to turning and things like that.

Michelle Schroeder:

Exactly. Yeah, exactly. And some of the advice that we're giving now might sound a little different than advice we gave before, but it's definitely those life cycle stages. And going back to your first question about, how do people prioritize? Well, in the elementary platform, likelihood to turn, likelihood to lapse.

All of those things are calculated based on our retail trained algorithms. So, they don't have to do that math in the corner. They don't need to go talk to a data science team. They have it at their fingertips, but what they do with it, I think is the thing that matters. And I'm sure you are giving similar guidance to your clients.

But for us, we're saying right now where cost of acquisition is so high, media spends so high. We're asking people not to try to take customers that are loyal to other brands away, but instead focus on their flakes, focus on the people that are not yet loyal to their brand.

And design journeys for them, design personalized experiences for them based off of the context that they're bringing with them as consumers. What they are looking at on your site. What they appear to be interested in. Where they linger, where they bounce. And design journeys for them that bring them in and bring them into that loyalty circuit.

Michelle Schroeder:

And that's I think good during a recession. It's probably good advice, no matter what, but it's good recession advice in particular, because the other type of thing, trying to convert other people's buyers, too expensive right now-

Erin Raese:

Yeah.

Michelle Schroeder:

... unless you have an unlimited budget.

Erin Raese:

No. I think that's awesome. We've some stats personally that I tend to share a lot. Basic one, you're getting 80% of your business from 20% of your customers.

Michelle Schroeder:

Yeah. Pareto.

Erin Raese:

So, do you know who those people are? If you don't know who those people are? You better, go find them and figure it out because you got to keep them, right? You touched on this, the repeat rate. So, I think there's a Bain stat that says, if you increase retention by 5%, you increase profitability by 75%.

Michelle Schroeder:

Yeah.

Erin Raese:

And that's exactly what you're talking about. It's ultimately shifting the dollars. It's easier to keep a customer than not to. And then, a stat that I just recently heard that was interesting is 86% of your best customers will refer others.

Michelle Schroeder:

Mm-hmm.

Erin Raese:

So, if you're looking for new customers, it's a great way to do it. And then, the part of that I love the most is the people that are coming in that way, through a referral, spend and are actually worth 16% more than the ones that are coming in your other ways.

Michelle Schroeder:

Yeah.

Erin Raese:

And so, I think that really tells a story of keep what you have. And then to your point, I always called those like rotators, those people that are spending with you, and with some of your partner, you're not getting that full share of wallet. And how do you bring those people in? How do you identify and give them and get a little bit more from them?

Michelle Schroeder:

Yeah. Love that. I think the biggest takeaway is, loyalty pays dividends. There's compound interest on great relationships.

Erin Raese:

I like that.

Michelle Schroeder:

Yeah. Because they refer somebody and then that referral's worth more. And then, that referral might refer someone and just things that everyone knows, but not always does your technology, or your strategy, or your team view on these things support, actually driving more loyalty.

And so that's another big thing is just giving people a sense, giving people a loyalty playbook. I think the ways in which our platforms come together do this really, really well, but just having blueprints for how to think about these things.

So, if you're being squeezed on the resource side, you've got things that you can just plug and play, and go from a loyalty perspective. I think those types of things that give the marketing team more efficiency, more speed to market.

Those are incredibly important, but I'd love to go back to something that we started on earlier, which is just around understanding your consumer. Again, it's so deceptively simple, but I just heard, a few months ago when everybody was talking about the recession and quarterly earnings for Q1 were being discussed.

And Walmart's CEO was saying something about how they're seeing a different strata of consumers emerging and the way that people are spending, just being very, very different. And he was saying, just reiterating what we've been talking about, which is that no consumer is the same and you need to understand your consumer very well.

And you need to incorporate that, not just in the experience, how they show up at your store, the types of marketing campaigns that you're serving them, but also in things like your pricing strategy and how you're thinking about discounting? Not just applying a blanket price increase, but thinking about things, product first, customer first, and not taxing your experience by just doing things in a batch and blast way, basically just raising all of your prices.

But instead looking at the areas where raising the price isn't likely to completely turn off a consumer, but we'll still get you the margins that you need in order to operate effectively.

Erin Raese:

Yeah. I think it's... we talk about it a lot in a little bit of a different way than you just did, but it's the consumer today, we're all our consumers, right? So, what do we expect? Our expectations of organizations are so much higher than they've ever been.

Michelle Schroeder:

Yeah.

Erin Raese:

I want to order it now. I want it on the shelf. I want to be able to get it and I want to be able to get it to my house today or tomorrow.

Michelle Schroeder:

Yep.

Erin Raese:

And so, consumers have high expectations, but they also, our time is a currency more than ever. So, how would you make our lives easier? And some of the things that we see, and we're talking a lot about, especially from a loyalty perspective, because people think about loyalty and they think about rewards or discounts, and it's always, "What extra am I giving? If I'm doing loyalty, I have to be giving more away."

Michelle Schroeder:

Yeah.

Erin Raese:

And I personally have been here a long time and I don't look at it that way. I really think it's all a lot about recognition, that if you actually recognize me, you understand me, you do make my life easier. Then, I'm going to stick around longer and I'm going to do more. I'll spend more, I'm going to talk to people, I'll be advocating more for you.

Michelle Schroeder:

100%. And I think oftentimes we all get caught up in terminology for what that means. What it actually means to be relevant to a consumer, to give them those experiences that they want, to make them timely. And yeah, make them work in the context of what the consumer is expecting from you.

And I think... I was just having a conversation earlier with some of our clients about personalization, which is one of those things that people feel, "This is what's going to unlock loyalty for me. This is what's going to unlock the engagement metrics, the LTV, all of the things that I'm looking for my marketing to deliver." And it's such a technological capability.

It's a problem of technology in my view anyway. And obviously I'm coming at this from a tech view, but being able to understand your consumers and deliver what they actually want, the time that they want it. This is a little bit of a tangent, but just thinking about the modern CEO, it used to be that the CEO was a marketer or a product visionary or something like that.

And today's great retail CEO, for better or for worse. If you want to think about Jeff Bezos in this category, they're supply chain CEOs, they're focused on getting you what you want when you want it, and with no deviation. It's the same for, I think, the modern marketing leader, except the supply chain isn't the product, it's the experience.

And that experience relies on data. There's a whole data pipeline and supply chain that needs to be healthy in order for you to deliver what a consumer actually wants in real time again, when they want it, how they want it.

And this is again, this is why I think that question of what tech do you use and how do you layer your strategy on top of it makes it so much more important than I think it ever has been. And I think definitely COVID started this era, but the recession is going to just make it more obvious how necessary it is.

Erin Raese:

I love that. That's great. We use that too, a fabulous point and I love the analogy. I think it's just spot on. So, I was just sitting here going wonderful. Perfect.

Michelle Schroeder:

Yeah. I’m reluctant though to mention Amazon, when we're talking about retail, they're just the big shadow.

Erin Raese:

Yeah. But Hey, I think retailers today have figured it out. And I think that they have the opportunity to do and create even much better experiences, especially because most of them have the brick-and-mortar opportunity and …

Michelle Schroeder:

Absolutely.

Erin Raese:

... there so much more they can do. And I think five years ago, where everyone, maybe even 10 years ago were running scared. And I think they're now grasping that. And frankly, to your technology points, how do you take that technology? And in addition to delivering digitally, how can you improve those experiences in-store too? And how do you-

Michelle Schroeder:

Yes.

Erin Raese:

... know that customer when they're coming in the door? I don't think we've cracked the code on that as well as we probably could with the technology available today, but how do you really understand who I am when I'm walking in? And to be able to provide another level of service.

Michelle Schroeder:

100%. And then how do you reconcile it and build the whole chain back together? Again to me, that's a team tech people strategy question, but the tech part is really, really critical.

Erin Raese:

Yeah. Topic for the win room.

Michelle Schroeder:

Exactly. Exactly.

Erin Raese:

Well, great. Well, I thought this was an amazing conversation. Lots of great ideas. I love your perspective. Thanks for sharing it. Do you have any other parting thoughts, any advice you'd like to give to the people listening who are going through this today?

Michelle Schroeder:

Yeah. I mean, I have a tendency to bright-side things. It's my nature. I think it's part of what makes marketing great is people who can see through the tunnel and look at the light, but just reflecting back on 2008, the financial crisis of 2008 and looking at the retailers that came out ahead and the amount of value they drove for their shareholders, which I think was something at 11%, which is five times what their peers were driving in 2018, 10 years after that recession.

And so, I think the pressure here to come out ahead and to use your data in the right way, and to understand your consumers and build the experiences, building that loyalty that matters most, it's going to pay off in such a huge way. And so, I guess my feeling is just one of massive optimism for those marketers that get it right. There's just a lot of winning to be had, I think on the other side of this.

Erin Raese:

I agree too. I tend to be an optimist, just bring it on, we'll figure it out resiliency. But when you look at it the way this conversation is gone, there definitely... there's two [inaudible 00:27:36] ability. People have them at their fingertips. And to your point, it's very, very valid, is you don't have to boil the ocean, right? You start out small and chip away and do some small things that will have some pretty significant impact.

Michelle Schroeder:

Exactly. Exactly. I think boiling the ocean is the absolute wrong take here. So, I agree. Completely agree.

Erin Raese:

Well, terrific. Well, thank you so much for your time today. It was a pleasure speaking to you. I think we're going to have to do this again sometime.

Michelle Schroeder:

Absolutely. Thanks, Erin.

Erin Raese:

Thank you.

Featured Speakers

Erin Raese

Erin Raese

SVP of Growth, Annex Cloud

Michelle Schroeder

Michelle Schroeder

Chief Marketing Officer, Ometria

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For more than 10 years, Annex Cloud has been the worldwide leader in technology and service solutions that transform customer loyalty experiences for organizations, extending valued customer engagements, ultimately making beloved brands. Powered by the modular, comprehensive and scalable Loyalty Experience Platform™ solution suite, Annex Cloud customers capture and use zero- and first-party data to seamlessly deliver value-based individualized experiences across the entire customer journey—from awareness to purchase to retention, loyalty, and advocacy. This one-to-one engagement helps enterprises accelerate growth by increasing average order value, repeat purchase frequency, and customer lifetime value. Annex Cloud is recognized by respected industry analysts and integrates with more than 100 market-leading technologies to seamlessly integrate loyalty across the tech stack.

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Ometria is a customer data and marketing platform that helps retailers increase customer loyalty and CRM revenue by sending personalized marketing messages throughout the customer journey.

This solution combines the data unification and customer insight of a CDP with a cross-channel marketing orchestration platform, letting retail marketers easily and efficiently create experiences their customers love across email, mobile, on-site, social, direct mail, and more.

To learn more about Ometria, visit https://ometria.com/




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