I D C M A R K E T S P O T L I G H T

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1 I D C M A R K E T S P O T L I G H T T h e R o l e o f Marketing in Customer Ad vo c a c y June 2017 Adapted from What Is Marketing's Role in Customer Loyalty and Advocacy? Examining the Role of Post-Purchase Marketing by Andrew LeClair and Mary Wardley, IDC #US Sponsored by Influitive Advocate marketing is among the five key competencies needed for successful modern marketing execution. IDC defines advocate marketing as programs that encourage and motivate others, especially customers, employees, and partners, to speak on behalf of the brand and/or its products. Advocate marketing includes owned advocacy (e.g., employees acting as advocates) and earned advocacy (e.g., customers and third parties independently advocating). IDC finds that most advocate marketing programs target earned advocates. Less than half (4) of B2B IT vendors surveyed have specific programs for owned advocates. Yet, despite being one of the top five most important competencies for marketing success in today's B2B IT environment, in IDC's 2016 research, 9 of vendors did not have advocate marketing programs or staff in place. IDC's Customer Experience Practice conducted a study IDC's 2017 Loyalty Marketing and Advocacy Marketing Barometer to learn about the progress being made to support advocate marketing efforts across the industry in This Market Spotlight examines the results of that study, with a focus on advocate marketing, and provides guidance for achieving effectiveness and ultimate success. Introduction Customer advocacy is crucial to increasing company revenue. New buying habits precipitated by digital transformation (DX) and online customer behavior, combined with the transition into a subscription-based economy, are driving this change. While responsibilities for executing on customer advocacy initiatives span multiple customer-facing roles (including customer success, sales, customer service/contact center, and product management), IDC finds that customer advocacy is largely a marketing-led initiative. Combining these two notions, it becomes clear why 87% of the B2B IT vendors surveyed by IDC indicated that advocate marketing was either very or extremely important to their overall company's success. As a result, IDC continues to see companies devote more of the marketing program budget and add additional marketing staff to support these efforts. In IDC's 2016 Five Key Competencies for Modern Marketing Assessment, only of B2B IT vendors surveyed had advocate marketing programs in place. In 2017, this increased to 67%, a 57 increase year over year. The increase in both marketing programs and marketing staff to support advocate marketing is a trend IDC expects to continue in upcoming years. US

2 Advocate Marketing Staffing Roles and Program Execution Tactics What do advocate marketers do on a day-to-day basis? IDC finds the primary staffing responsibilities in this area to be the discovery and nurturing of advocates (see Figure 1). Likewise, IDC finds that the top marketing tactics reflect the goal of discovery and nurturing advocates (see Figure 2). More than half (58%) of the survey participants have implemented marketing technology to support their advocate marketing efforts. Interestingly, of the 25 participants using a specific technology, Influitive garnered the largest proportion of the users with just under half 12 of the total 25 respondents reporting that they are using Influitive. FIGURE 1 Responsibilities of Advocate Marketing Staff Q. What are the top functions your advocate marketing staff is responsible for? Secure customer references Develop case studies, videos, and quotes Develop advocacy strategies, programs, and customer segmentations Manage customer Analyze customer Define metrics and reference program insights KPIs IDC

3 FIGURE 2 Advocate Marketing Tactics Q. What marketing tactics are currently a part of your advocate marketing efforts? Case studies Customer advocacy programs Creating and/or maintaining communities Peer-to-peer customer reference management Customer Analyst/third-party advisory boards advocacy programs Employee advocacy programs The Top Barrier to Effective Advocate Marketing The barrier to effective advocate marketing mentioned by survey participants was a lack of customer availability or interest (see Figure 3). However, best practices from IDC's interviews with active advocate marketing practitioners revealed that this barrier can be overcome with proper advocate identification and appreciation for the demands on their time. IDC recommends targeting processes be implemented initially to identify those customers that are most likely to advocate. Field marketing, sales reps, customer success managers, and product managers should all be involved in the nomination process, while the advocate marketing staff should be responsible for approving and building relationships with the nominated advocates. In addition, IDC recommends the personalization of advocacy engagement. By aligning the advocacy ask to the advocates' comfort level, organizations can avoid customer fatigue due to inappropriate topic matching and/or improper utilization. A customer may not be willing to be named in a press release but is comfortable with speaking at a local event. Knowing the advocates' motivations and aspirations is key. As advocate marketing programs mature, companies should leverage successes found in the selective pilot programs. Maintaining a process that is too selective makes it tough to keep momentum over the long term. As customers leave advocate programs (often because they are leaving a company), companies need to ensure they have enough advocates in their pipeline to fill in the gaps IDC 3

4 FIGURE 3 Top 3 Barriers to Effective Advocate Marketing Q. What are the top 3 barriers to you achieving your advocate marketing goals? 25% 2 15% 5% Lack of customer availability or interest Lack of internal alignment across functional areas Lack of employee bandwidth or conflicting internal priorities Measuring Success Advocate marketing metrics are largely "execution-level metrics" by marketers, for marketers, to improve marketing results. These include key performance indicators (KPIs) such as the number of current advocates or number of clients willing to become advocates or mobilized to participate in customer programs (see Figure 4). IDC recommends leaders prioritize measurements related to advocates' effectiveness and impact on the company's bottom line. For example, if customer X took a reference call for prospect Y and then prospect Y became a customer within a certain time limit, that revenue can be attributed to the advocate (and the advocate marketing program at large). This helps to provide insight on which advocates and which advocacy initiatives/campaigns are most effective in driving new business. Leading companies are also moving away from measuring just the number of advocates to the examination of how effectively these advocates are mobilized. More specific metrics related to this concept include: Increased deal speed when references are involved New revenue from customer referrals Influence on new deals from advocate-generated content (case studies, etc.) Increased retention rates and account growth (upsell/cross sell) for customers with employees participating in advocate marketing programs This mirrors other shifts in marketing metrics overall. IDC recommends that a long-term view of ROI be applied to revenue contribution. The indirect nature of advocacy and behavior of advocates lends to measuring advocate marketing as an influencing factor on revenue contributions rather than a sole contributor IDC

5 FIGURE 4 KPIs Used to Track Advocate Marketing Effectiveness Q. What key performance indicators are you currently using to track the effectiveness of your advocate marketing efforts? Number of advocates Number of clients willing to be a reference/in case study Net Promoter Score Customer satisfaction score Voice of customer metrics Participation in loyalty programs Conclusion and Recommendations IDC recommends that companies take the following steps to ensure success when implementing an advocate marketing program: Appoint a leader (customer marketer) and establish accountability. Advocate marketing is a cross-functional objective requiring significant coordination for successful execution. Put a leader in place to serve as a liaison with other customer-facing groups. Require metrics and the use of data to justify decisions. Get executive sponsorship from the C-suite, explore "corporate-level metrics" for advocate marketing. At the highest level of the company, the CEO and the board of directors care about metrics that measure overall results. Begin to examine the effectiveness of your advocates and their impact on your company revenue. Make advocate marketing a corporate initiative that is embedded in the customer journey. There is shared interest across any organization on making and retaining successful customers. A defined customer journey is a way to align and focus the organization around one common initiative. The more aligned organizations are on how they engage customers, the more effective they are at discovering and developing advocates. Remove redundant and conflicting systems/efforts. Ensure all customer relationship management (CRM) data is integrated and available to all aspects of the organization involved in advocacy efforts. With leadership in place, develop a corporate strategy on customer advocacy to ensure a unified brand image and to avoid duplication of programs IDC 5

6 Specific tactics: Are the upstream and downstream processes aligned specifically to sales and service? There needs to be strategic alignment with cross-functional departments on common objectives/goals. What systems integrations are required for a successful advocate marketing program? Primary integrations should include marketing automation and CRM to continually monitor and measure program ROI and metrics. Are all groups that are accessing customer data accessing the same master information? Is there a central point of authorization for customer systems? Use data to personalize program offerings and determine best practices. The best advocate marketing programs are tailored to the advocate. Pilot segmentation and targeting in programs, and use the data to inform future best practices. Track advocate creation and sustainment. Know who your most loyal customers, employees, and partners are by implementing systems that focus on creating and sustaining advocate marketing programs. Know your objectives and goals for these individuals and clearly outline the value they receive from participating in these programs. Typically, advocates are motivated by gamified platforms that offer status, access, power, and stuff (SAPS). A B O U T T H I S P U B L I C A T I ON This publication was produced by IDC Custom Solutions. The opinion, analysis, and research results presented herein are drawn from more detailed research and analysis independently conducted and published by IDC, unless specific vendor sponsorship is noted. IDC Custom Solutions makes IDC content available in a wide range of formats for distribution by various companies. A license to distribute IDC content does not imply endorsement of or opinion about the licensee. C O P Y R I G H T A N D R E S T R I C T I O N S Any IDC information or reference to IDC that is to be used in advertising, press releases, or promotional materials requires prior written approval from IDC. For permission requests, contact the IDC Custom Solutions information line at or gms@idc.com. Translation and/or localization of this document requires an additional license from IDC. For more information on IDC, visit For more information on IDC Custom Solutions, visit Global Headquarters: 5 Speen Street Framingham, MA USA P F IDC