In today’s digital age, companies must use data to measure and grow their businesses and also, disrupt them.
How to do that was the focus of WorldCity’s CEO Club on Feb. 3, 2017, led by Carlos E. Gutierrez, Miami CEO and Chief Growth Officer for Latin America at ad agency McCann Worldgroup.
“Disruption is prevalent. It’s pervasive. It’s everywhere,” said Gutierrez. “It can create anxiety, but it can be managed.”
Gutierrez said everything digital can be grouped into three interconnected categories: Operations or business model disruption, data strategies and top-line growth acceleration.
Operations or Business Model Disruption
Consider these recent disruptions: Netflix, Amazon Prime, and Hulu in television and entertainment media. PayPal in banking. Uber in transportation.
An IBM survey of 3,000 CEOs literally referred to such changes as the “Uberization of an industry.” A total 32 percent of CEOs responding called technology disruption the most important challenge they faced, with the number at 50 percent among CEOs in entertainment and media, according to the survey.
“If you’re wondering what’s the latest Internet disruption innovation being talked about, it’s the convergence of the physical and data world,” said Gutierrez, pointing to the popular Pokémon Go game as one example.
For many participants at the CEO Club, concerns about disruption were specific to their industries. Michael Costello, senior vice president and international general manager at Clorox, pays attention to disruption in manufacturing and logistics. Harvey W. Gurland Jr., managing partner in Miami at international law firm Duane Morris, is especially focused on innovation in cyber-security to protect confidentiality.
Companies need not be reactive to disruption.They can encourage it for their own gain, said Paul Tessy, e-commerce CEO for Latin America and the Caribbean at delivery giant DHL.
“Disruptions, sometimes we think about them as risk,” Tessy told the group of nearly 20 CEOs and top-level executives. “But I think the most important thing is to jump in and develop and start to play in the space. You’ll find you can also take advantage of that. Take a defensive posture, and you’ll lose the game.”
That’s especially true in public relations and media, where disruption is coming at a searing pace, said C.L. Conroy, president of communications firm Conroy Martinez Group.
“Delivering your message to the consumer used to be through the media. You did your press release. You talked a journalist into doing a story,” said Conroy. “Now, you go direct with social media and digital media…Look at what we have today with the first President who is delivering his messages directly to the consumer audience through Twitter.”
That helps explain why U.S. companies this year are projected to spend more on digital than TV ads for the first time ever, said Conroy.
Data strategy: The power of segmentation
Amid the changes, it’s vital to collect, analyze and act on the right data to build your business, said Gutierrez.
“I’m the CEO. I need to decide what we’re going to measure,” said Gutierrez. “A data strategy is a mechanism by virtue of which you put in place the structure and the processes to collect the data, clean the data, and somehow integrate the data. Then, you have a beautiful report and a team that’s going to transform that data into [results].”
Should securing the data be part of the data strategy and included in its cost?, one participant asked.
“Absolutely,” said Gutierrez. “I consider that part of execution.”
While costs for data may be rising, a sound strategy should pay off by better targeting potential customers, Gutierrez said. “The more you narrow down [your demographic], the more you’re going to remove the competition for that particular click and be able to price it better.”
Accelerating growth in sales
Gutierrez identified six areas key to data strategy that can speed sales or top-line growth: search, referrals, social media, website, mobile, and advertising/display.
Search is the most important by far. Two-thirds of any purchase process starts with search, with 60-70 percent of those searches coming from Google and 20% from Bing, he said.
Referrals are next most important. While the No. 1 reason why someone won’t buy something is price, the second reason tends to be bad reviews, said Gutierrez.
“How do you manage the skew of negative reviews” when satisfied customers are less likely to leave good reviews?, asked Daniel Molina, business development director at internet security firm Kaspersky Lab.
Some companies employ communications companies to respond to those reviews and handle social media. Indeed, Conroy said help with negative reviews was a top reason clients come to her business.
“It’s very difficult. All you can do is ensure that you respond to every single [negative] comment,” said Gutierrez, noting it sometimes helps to continue the conversation offline. “Make sure it’s very evident you are trying to engage the person. Everybody else knows that you’re there [helping].”
Companies also can reach out to the site publisher to verify if a bad review came from an actual customer and not an internet troll. On social media, they also can add new content to push the bad review down the page from view of others, said Conroy.
To build sales, it’s also vital to have a strong website and mobile presence, Gutierrez added. A website says who you are as a business. Without one, you don’t exist. Make the site look fresh and sharp on computers and on mobile devices.
By honing these practices, said Gutierrez, “you’ll have a better reading on how much it cost you to generate that particular sale.”