Major bank, major digital transformation
BARCELONA – Robert Tas, managing director and head of digital marketing at JP Morgan Chase, and David Edelman, McKinsey partner, show why and how marketers have to be more systematic and disciplined about extracting value from every stage of the customer decision journey.
- December 2012
- By Robert Tas and David Edelman
- Marketers can find millions of euros by being much more systematic and disciplined about extracting value from every stage of the customer decision journey
- Creativity is critical to making marketing successful, but embracing the science of marketing is a must-have capability marketers need to improve the effectiveness of their spend and grow their businesses
- To make the advantages of digital marketing sustainable, you need to develop concrete goals for the group as well as a centralized organization that can scale across the various business units
Start with the customer decision journey
The digital world is spawning a cascade of innovations that are pushing the boundaries of marketing. However, this excitement and energy can often distract organizations (the “Shiny Object Syndrome”) from getting the basics right, which can mean millions of euros in growth or savings. Getting the basics right starts with the customer decision journey (CDJ).
Marketers need to be deliberate and systematic in digging into the data and analyzing each stage of the CDJ to identify the leakage, waste, and opportunities. Improving data use across the CDJ can sharpen targeting, enable personalization, and accelerate optimization. For one major bank, that meant pulling together microsites to help improve search results at the consideration stage and developing targeted banners across all relevant sites based on known information about the visitor (credit worthiness, enrollment in programs).
Embrace the science of marketing
To enable more sophisticated customer engagement programs across the CDJ, we created a provisional database of online behavior. With a database in place, the team was able to mine the data, do much more sophisticated (and granular) segmentation analyses, and reveal how effective the digital marketing spend was. These helped us develop new models — from message delivery to product engagement to cross selling.
At this major bank, the data pointed out that, for example, using email rather than direct mail for engagement offers increased opt-in rates by nearly 300 percent. We cut costs by decreasing direct mail while also increasing enrollment rates by using email more aggressively. By enhancing the web experience on pages that could affect call volume, pilots are already saving over $20 million per year. Simply driving customers into deeper digital relationships paid off in higher lifetime value.
Build capabilities around digital marketing
For digital marketing to move beyond one-off successes, it requires specific goals, resources and a supporting organizational infrastructure. Those depend, of course, on the specific situation of each individual company. But in our case, we started by laying out broad objectives for digital marketing: Double the blended conversion rate of the digital channels; use integrated view of the customer throughout the enterprise to improve profitability and customer experience; drive operational efficiency of digital by shortening the time and cut cost of a marketing cycle.
The organizational structure changed to support the goals. The company developed a digital Center of Excellence to support the business units, and bring skills and expertise to bear at an affordable scale.
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