Marketers planning their return to growth strategies have many numbers to juggle. There are short-term KPIs that monitor progress and long-term measures of ROI that track impact on revenue. All of them matter in one way or another – all help you to quantify marketing’s contribution – and keep that contribution aligned with what the business needs.
However, there are times when narrowing down the numbers that you’re focusing on can really help. When innovation is paramount, and your business as a whole needs to be realigned, it pays to have a single metric to act as the organisation’s North Star – the measure that marketing, sales, customer support and others can build their processes and strategies around.
This week, LinkedIn’s UK Country Manager & VP for EMEA and LATAM, Josh Graff, made a compelling case for what that metric should be in 2021. It’s your measure of customer value:
Customer value varies depending on the business you’re operating in, but if you can measure your business success and tie it to the value you’re delivering for your customer, then you’re onto a good thing. It is very difficult to go wrong when you know that your customer value metric is growing at a faster rate than your own revenue or profitability." Josh Graff, UK Country Manager &VP, EMEA and LATAM, LinkedIn
Josh was speaking on our latest episode of Live with Marketers – an episode focused on what the Future of Growth will look like as businesses start to emerge from the pandemic. He was joined by Andrew Harkness and Samairah Maqsood, the COO and Sales Director of MVF. They represent a business that has become one of the UK’s fastest-growing by connecting customers to active prospects at scale and is currently the Sunday Times Best Place to Work.
Why customer value is the key to returning to growth
The vision of customer value that Josh put forward seems radical – and potentially even intimidating. It’s the idea that, in disrupted times, your business is best served by growing the value that you deliver for customers faster than the value that you get from them. With rebuilding revenues a priority for many sectors, that can seem like a big ask. However, all three of our guests were adamant about the need for this type of serious customer-centricity. And all three were talking on the basis of very relevant, recent experience.
“The companies that we saw doing well in lockdown were those with a client-focused core,” says Samairah. “During times of uncertainty, it’s smart to invest in entering into a more strategic partnership domain. If you nail those things, then the relationship naturally becomes more progressive and less volatile.”
These principles will hold equally true in 2021 as they have done over the last year. After all, as a B2B marketer, your own business’s return to growth will depend very much on the return to growth that your customers plan for. It’s the businesses that focus on delivering value quickly and consistently that will find themselves with more of those customers – and more value of their own.
How the digital buying journey puts a premium on value
Customer value has always mattered, of course – but its importance has grown hugely because of the way that the B2B buying journey has changed under the influence of the pandemic. In a McKinsey survey in September, only 20-30% of B2B buyers worldwide said that they wanted to have face-to-face meetings with sales in the future – even in an ideal, post-Covid world. These decision-makers are opting for a predominantly digital buyer journey in which they choose to engage with sales when they’re ready. The moment they’re ready is usually when they’ve identified that they’ll be getting clear and obvious value from the conversation.
In this digital buyer journey, sales and marketing alignment becomes absolutely vital. Recent research from Forrester commissioned by LinkedIn showed that orienting sales and marketing processes around critical moments of trust is one of the most important steps in making such alignment a reality. And the best way to define those moments is for both teams to agree on what constitutes value to the buyer.
“The buying journey is getting longer and more complicated, but I see companies of all sizes benefiting when they focus on the shortest time to value for the client,” said Hans A.T. Dekkers, the Chief Digital Officer and VP Sales EMEA for IBM, on another recent episode of Live with Marketers. “Even if the processes are long and the sales cycles are long, ask yourself how you can achieve the shortest time to value within that.”
Defining customer value – in partnership with customers
A focus on customer value provides you with a formula for securing future growth by measuring the extent to which you’re helping your customers grow. And there are two parts to this formula. Ultimately, you encourage the different moving parts of your organisation to focus on customer value first – you give them permission to align their internal metrics to this external measure rather than the other way around. First though, you need to define how you can best measure the value that you’re delivering to your customers.
As Josh explained, elevating the importance of customer value is a decision that LinkedIn made prior to the pandemic – and it’s not a one-size-fits-all approach. “We shifted the way we measure success in our organisation 18 months ago so that we still look at revenue, productivity and profitability but customer value is one of our core measures of success,” he says. “Customer value varies depending on the business you’re operating in, so in our case it’s different for Talent Solutions, for Sales Solutions and for Marketing Solutions. It’s about figuring out what’s at the core of making your customers more successful tomorrow than they are today. If you can nail that, you’ve got a good business model ahead of you.”
That process of figuring out customer value doesn’t have to happen in isolation. In fact, the opportunity to partner with customers and buyers on defining it is another important benefit of the approach.
“Our entire business is built around understanding our clients’ success metrics,” says Andrew Harkness. “We’re able to drive a volume of leads for our clients, they send us data on how those leads are performing and we the optimise our approach to hit their success metrics. The notion of understanding clients’ success really resonates with us.”
Making customer value more than a mission
Customer-centricity is one of those phrases that can be cheapened by over-use. However, just talking about it or having it as part of your mission statement is unlikely to be enough going forward. If we’re to operationalise customer-centricity then we need to put a value on it – and we need to be prepared to track that value and optimise the way we market and the way we sell around delivering it. That way customer value becomes more than just a metric. It’s a spur to innovation, a key enabler of sales and marketing alignment, a North Star that safeguards the buyer experience – and a formula for building the type of strategic partnership that your customers come to rely on.
That’s a genuinely radical idea – and a great foundation for return to growth strategies this year.
Want more insight into how the Future of Growth will look? You can catch our full Live with Marketers episode here.
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