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[25 comments]

Who owns the customer experience in retail?

April 8, 2014

Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research's weekly analysis on emerging issues facing retailers, presented here for discussion.

Should the emerging CXO role — chief customer experiencer — own the customer experience in retail? If so, I think they'll have to dethrone the CMO.

Marketing historically has been in charge of advertising the promotions and deals that merchandisers secured from vendors, and not much else. But omni-channel retailing has made marketing much more important. One of the first things retailers wanted out of omni-channel was to "present one face to the customer." At the most basic level, it comes down to what they are promising their customers, and how that is different from what everyone else out there is promising. That's marketing.

Also because of omni-channel, marketing became important in its own right as the de facto owner of customer data. Whether because of loyalty programs or voice of the customer, or a catalog history, or even just third party-sourced customer segments, marketing kind of had the most customer data on hand. And when the goal is putting the customer at the center of the enterprise, that kind of has a galvanizing effect on the holder of that data — making their capabilities more important by default.

Who's their competition? The CEO is the shepherd of the customer experience, but as for the individual ultimately responsible for making sure that said customer experience is realized? Well, who knows the most about the customer?

What about the channels? It wasn't that long ago that stores actually knew the most about customers and e-commerce owned digital marketing. But focusing on the transaction — which is what channels are designed to do — leaves out an awful lot of the customer experience that happens long before the consumer steps foot in a store or navigates to the retailer's e-commerce site. So which group has the largest view?

To be fair, there are a few retailers out there where the CXO or VP of omni-channel is truly focused on customer experience — defining it, and eliminating cross-channel conflicts or misalignments that get in the way of it. But I find them to be a pretty rare breed. Most tend to be glorified integrators. The job description calls for aligning channels and technology so that whatever brand promise is made, the retailer will someday be positioned to execute on it.

And most times, they are an itinerant VP, one without much staff, and operating half by executive decree ("You will do what she says") and half by persuasion.

And at the end of the day, which resources will this individual rely on the most, both in understanding where to focus first, and in checking to make sure their efforts are paying off in terms of actually improving the customer experience? Who is best positioned to answer those questions? Marketing.

Discussion Questions:

Do you agree that marketing's role has grown to claim ownership of customer experience at retail? Do you imagine a CXO doing things a CMO cannot or complementing the CMO's role?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Who owns the customer experience at retail?

Comments:

Marketing should claim this role. Why create another level with claim on customers and the customer experience? Taking this responsibility will require a more hands-on role for marketing, especially at store level.

Basic questions marketers should ask themselves include: How to create a single look and feel for the shopping experience across all channels; How to migrate consumers between channels with minimum friction; and how to capture consumer attention and drive sales, regardless of initial touchpoint.

Managing the customer experience would be a big step for marketing, one that should be approached with data and a lot of customer feedback.

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Max Goldberg, President, Max Goldberg & Associates

The answer to this headline is every employee. Either you are actively serving a customer, or serving someone who does.

Until retailers hire, instill and train their employees that each of them owns the customer experience, who gets a job title seems moot.

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Bob Phibbs, President/CEO, The Retail Doctor

The best retailers have CEOs that own and drive the customer experience - think Mickey Drexler, Jeff Bezos and Howard Schultz. That said, CMOs should also function as the CXO or Chief Customer Officer. The challenge with titles like CXO is that to too many people CX = online experience rather than omni-channel, which it needs to be for most merchants. One big issue is the silos that separate "marketing" and online - namely who manages the email "slots." Yet another is the C-level operations leader that manages brick-and-mortar store operations, which also has significant impact on the CX.

The best retailers are aligned around customers regardless of who has what title. This starts with leadership and that starts with the CEO.

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Phil Rubin, CEO, rDialogue

Kohl's seems to have gotten this right with last year's hiring of Michelle Gass from Starbucks as the "chief customer officer." In this case, she has direct responsibility for all aspects of the company's "customer engagement strategy," including both marketing and omnichannel efforts. It's important for the CXO position to be empowered in this way, not to be treated as a staff support job without real authority to drive change.

At the same time, the most important customer-facing element of most brick-and-mortar or omnichannel retailers is the shopping experience in the physical store. Aligning the strategic view of a CXO with the operating realities of a Director of Stores may require a broader portfolio for the "experience officer"...or a CEO prepared to deal with natural internal tensions in a productive way.

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Dick Seesel, Principal, Retailing In Focus LLC

The challenge for customer experience is that it "lives in the cracks and across all touch points." It crosses the boundaries between stores and online. It transcends the purchase experience because it involves touch points before, during and long after the sale.

In short, customer experience is consumer centric, and does not easily find its way onto a "clean hierarchical org chart."

CX definitely starts at the top with customer first vision. Bezos definitely fits the model of a CX driven CEO. The CEO can set the tone, but not manage the details of the execution.

Someone needs to "own" CX on a daily basis, where it happens at the moments of truth with consumers. While Nikki Baird makes a strong case for the CMO knowing the most about customers and owning the messaging to them, the CMO rarely has responsibility for all of the cross functional execution comprising the total experience from the eyes of the consumer.

While consumer experience is one of the last great hopes for bricks and mortar retailers, it is most challenging aspects required for true omni-channel differentiation and execution. If a CXO doesn't get up every morning totally focused on all touch points of consumer experience, much of the "seamless experience" consumers are looking for will continue to fall through the cracks.

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Chris Petersen, PhD, President, Integrated Marketing Solutions

This may be a little off topic, but one of the most impressive things to watch is a retail CEO bagging at a checkout stand or walking a customer to a product location. I can recall seeing a former supermarket CEO collecting carts and thinking that it was an inspiration for the staff and showed customers the importance the company placed on service. For the life of me, I don't understand why CEOs and other top executives spend so little time in the stores.

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Ron Margulis, Managing Director, RAM Communications

Nikki raises some interesting issues, most of which point back to the fact that the concept of a CXO is relatively new in retail. There has always been talk about customer experience, but few retailers have had it in their DNA. Unlike the hospitality industry, retail hasn't quite acknowledged the importance of CX as driver of business as much as they have marketing, product management, and logistics.

So sure, marketing has been the closest to CX and the questions about consumer perceptions and experiences, but for organizations that are awakening to the importance of CX, that has to change. The CXO needs to have as much (probably more) clout and influence in the C-suite as traditional C-level colleagues if retailers expect to compete in a world full of connected consumers that can create their own experience anytime, anywhere.

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Ken Lonyai, Digital Innovation Strategist, co-founder, ScreenPlay InterActive

CXO vs the CMO should not be the debate here. You need one or the other (definitely NOT TWO) -- compromise on the title, if you must.

The consumer has to be at the center of the equation for today's retailer -- now more than ever. An individual department head, reporting to the CEO or COO, as well as an adequate team of marketers have to be able to support store operations, merchandising, and marketing communications in all media forms, including in-store.

Keep and eye on Michelle Gass, CXO at Kohl's. We'll all have some learning experiences from Kohl's actions this year.

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Roger Saunders, Managing Director, Prosper Business Development

Call these people what you want, but in retail the customer experience is marketing and marketing is the customer experience. How can you have two heads on this horse?

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Gene Detroyer, Professor, Independent

Nikki is a truly insightful thinker...and her point about marketing and the customer experience sure resonates with me. My response is not at all opposed to her point - it just comes at it from another perspective.

I'm heavily involved in a disruptive software venture where so much of our focus is on the "customer interface" - i.e. the customer experience with our technology. So right now our systems engineers and architects "own" the customer experience.

But the truth is, we need to get away from the "owning" metaphor. NO ONE owns anything! We might as well ask "who owns air?" It's all one thing and this need of ours to compartmentalize and define the pieces is going to do us in. Sir Isaac Newton made a great contribution, but it's time to move on. Our customers go through countless points of energetic connection to our store or service. Every one of them touches all the rest. As with energy which can neither be created nor destroyed, but merely changed into other forms, the energy of the customer experience (good or bad) lives forever.

Who best to answer these questions about the customer experience? You. Me. Them. All.

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Ian Percy, President, The Ian Percy Corporation

Bob is right. Every employee coming in contact with a customer is directly responsible for creating the proper relationship that makes the customer smile, purchase, tell others and return.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

In general, we talk about customer experience as the summation of all the consumer touch points inclusive of marketing, in-store signage, and so on - it's a very broad swath that cuts across existing retail fiefdoms. Each company will have to further refine their definition and then decide how to best address.

They can choose from an existing c-level structure with CEO, CMO, or introduce a new role in an effort to bridge the various existing silos and capture the various customer touch points. Responsibility should be in a single role and not a shared one. Yet until measurements and incentives are aligned with an omnichannel strategy, whoever is responsible will struggle. Technology can facilitate, and marketing can communicate, but biggest risk is changing internal behavior and that starts with a common vision and strategy, strong leadership, and a supporting incentive structure that reflects the desired behavior.

What if the business were managed by a handful of common customer-centric KPIs across the retail organization and each part of the organization is measured by its contribution thereto? This enforces that the customer is truly the organizing principle of the business while helping to build lasting bridges within the retail organization.

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Mohamed Amer, Vice President, Global Integrated Retail Unit, SAP

Although there are chairs shuffling currently in many retail AND CPG organizations to determine where the responsibility for consumer experience resides, I believe the corporate culture in any of these organizations needs to be something like, "If you do not help the consumer directly, you need to be helping someone who does."

I think we are getting way too tied up on titles. CMO, Chief Customer Officer, CXO, etc... whatever. The more important thing to do is define the consumer experience strategy, develop ways to measure its effectiveness and performance and then assign people to monitor and recommend improvements. Call then what you want.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

I'm sure I've said this many times before, but strictly speaking, the customer owns the relationship, not the institution. Associates and executives both exist to serve - by delivering the best possible total experience.

We might re-frame the question in several ways:

Who shall be the chief architect of that experience? A CMO can certainly take on this role, if it's defined that way. Calling out a Chief Experience Officer or Chief Customer Officer certainly makes a statement about organizational priority, but ironically it may tend to exacerbate the "silo" problem we so often fret about.

Who "owns" customer data? (Yes of course, the customer should...) This sets up another area of potential rivalry between CXO and CMO.

What are the elements of customer experience and who is responsible for them now? I like to use the SCAMP model to deconstruct CX: Service, Convenience, Ambiance, Merchandising, and Price. Those pillars encompass operations, real-estate, store design, technology, HR, assortments, marketing and more.

Which C-level executives should be involved? Seems like all of them.

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James Tenser, Principal, VSN Strategies

Simply put, every employee owns the customer experience. Without everyone pulling in the same direction, properly trained, and providing service excellence, the customer experience will be substandard.

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Brian Numainville, Principal, The Retail Feedback Group

Designing and implementing new experiences that are relevant to segments and contexts takes a certain skill set. An experience happens at the intersection of a customer, the business and the touchpoint (technology). The ability to execute at that intersection, including the leadership qualities that will attract high quality team members (designers and builders,) makes this person a special hire.

Besides, CXOs and their teams need different customer data, their ecosystems are different, the cultures are different...I don't know. In the land of the product-centered retailer, the one-eyed CMO is king. So as far as ownership and blood lines, I think the successor to the throne is not the CMO.

Vahe Katros, Consultant, Plan B

It's the CEO's job. The best retailers and brands tend to have CEOs that are obsessive about the customer experience, understanding and serving customers. The proliferation of channels and the opportunity presented by exploding volumes of data has made experience management more complex than it used to be, which means you'll need a high functioning team to do it right.

In the face of this increasing complexity, CEOs need to be great generalists, as defined in this recent blog post. With the generalist outlook and skillset the CEO can then bring together a team of specialist executives from Marketing, Store Management, eCommerce and IT (Data) to truly work as a team and deliver the best customer experience.

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Martin Mehalchin, Partner, Lenati, LLC

I certainly agree that marketing has grown, however, today's marketeer is not quite ready for this role. I know, I know, marketing is the likely owner of the data, but where is the merchant in all this? Isn't that what retail is all about, really? Merchandising?

While the merchant may not be as skilled at the tools that marketing knows how to use, does that make them any less responsible for the journey of the customer they have so carefully bought for?

I guess you can call me old school on this one but I do believe that the customer experience goes hand in hand with the brand and the brand is a composite of the products it sells. The center of which is the merchant.

Once marketing and merchandising converge, we might just have utopia. And that's my 2 cents.

Lee Kent, Brings Retail Executives Together to Meet.Learn.Profit, RetailConnections

At retail, whoever is interacting with the customer gets the honor of ownership. If the customer is looking at an online ad, then whoever created and placed the add owns that customer at that particular interaction. If it is in the store, then the employee serving the customer owns the customer. My point is that everyone, at any given time, touches the customer and therefore owns the customer experience.

Customer service and experience are not departments. They are philosophies to be embraced by every person in the organization.

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Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC

Just to add two cents. The company culture owns the customer. Culture is defined by how those at the top act. If the culture is right, then everyone else in the organization knows how to act as well.

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Peter J. Charness, SVP America, Global CMO, TXT Group

Customer experience is the product of inputs from just about every functional area within a retail organization. The organization has to work synergistically to create a memorable experience. Thus, like a retailers mission, customer experience can't be delegated. It's the CEO's role to make sure that every player is contributing as they need to create the whole which is the customer experience.

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Ted Hurlbut, Principal, Hurlbut & Associates

All consumer touch-points (advertising, in-store merchandising, customer service, customer experience, and so forth) are part of marketing. Customer experience management is the responsibility of every retail level employee; from the merchandise and display, to the floor manager, and sales associates (or whatever name is utilized).

CXOs are not needed; invest behind great training programs.

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Carlos Arámbula, Managing Partner, MarcasUSA LLC

As pointed out by others, every employee is an owner of customer experience. This should be the DNA of any organization. However, what constitutes a good experience - what can be done to improve the same - what should be our customer strategy - these are questions which are more aligned with marketing. Should the CEO be concerned with these questions? Of course!

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AmolRatna Srivastav, Asst. General Manager, Analytics and Insights, Tata Consultancy Services

Marketing's role has certainly grown in retail, but a Customer Experience Officer crosses discipline of marketing/communications, e-commerce and store operations. I think a CXO is needed with a defined metric which is cross silo (not just store sales and Net Promotion Scores) and sees the cracks in the experience loop.

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Kenneth Leung, Director of Enterprise Industry Marketing, Avaya

I think there are really two questions here:

1. Who owns the vision for the customer's experience?
2. Who owns the data and the tools to help realize it?

For the first question, the vision needs to come from the top leadership of the company - the CEO. This needs to be informed by all aspects of the company - not just marketing or CX. If the company is going to be truly customer facing, every department needs to be in step, not just the marketing or CX teams. When it comes to true ownership, I think the CEO is the answer.

To answer the second question, the actual job titles aren't as important as the whole team's ability to work across disciplines, and alignment to the CEO's vision. In omni-channel retailing there has been a big emphasis on data - and I'm not questioning the value of data to inform good decisions. But fostering a holistic and relevant customer experience across channels requires the alignment of an enormously diverse group of people, across all levels and departments of the company. Again, this alignment and organization falls to the top leadership in the company, and can rarely be accomplished by a single department.

Paul Conder, principal, Lenati

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