At The Premier Business Leadership Series in Orlando, I sat down for a few minutes with Paula Puleo, Chief Marketing Officer of arts and crafts giant Michaels Stores, to talk about her first 18 months as CMO and her thoughts on the role of analytics in marketing and CRM.
You spend a lot of time out in the stores, you value face time, and that informs your marketing strategy. How do you transform your qualitative observations into data that you can take action on with confidence?
Those qualitative observations really just give us context to make decisions. We discuss our observations in team meetings every month, and focus on the trends that we’re seeing: maybe ad signage is unclear, coupon rules and regulations are too complex. We collect a lot of quantitative data in surveys, we know what people are buying…but in the store you jump outside the database and you see the experience really come to life. You see what people are not buying, which can be more insightful.
What are three ways you recommend companies can keep a pulse on the customer?
One is to find out what’s on their mind. We conduct a consumer sentiment survey every other month and it’s not about their arts and crafts behavior, it’s everything. Finding out what people are concerned about helps us overcome their barriers to purchasing.
I would also recommend you refine your customer health metrics and monitor those frequently. We monitor our customer health scorecard monthly. It includes some traditional elements like recency, frequency and monetary metrics and then we overlay that with other elements like how engaged they are, how responsive they are to brand promotions.
Also, monitor the social space. For us this is a no-brainer because, for the most part, crafters are naturally social people.
So we can tie all three of those together for a complete picture: What’s on their minds, how are they shopping at our stores, and what are they talking about?
You often advise “be brave as a marketer.” What do you mean by that?
Historically, marketers have gotten a bad rap—we’re not accountable, we don’t have the same discipline as other departments, etcetera. It’s really about being brave and balanced. As a marketer, you need to put mechanisms in place you can measure in order to build credibility. This is what gives you the leeway to test more things that might not always come with an immediate ROI—things like location-based marketing. You need to be open to those things but prove you’re still impacting the bottom line. You also have to be brave in eliminating some programs. At Michaels, we actually have a “delete team,” which makes recommendations on activities and programs to sunset. I challenge my team all the time to be brave and think differently.
What are the most immediate changes you undertook at Michaels when you joined as CMO?
Four things: I added a focus on product category marketing, expanded the digital team to include a social and mobile focus, and created a marketing operations team because we had become so multichannel and we needed a discipline around it.
And because one of Michaels’ corporate goals is to become more customer-centric, I created a consumer insights team. We have three people responsible for customer-based quantitative and qualitative research, and direct marketing analytics and measurement. Michaels had analytical staff in other departments like inventory and operations, but not enough people who understood how to build customer models. We were getting this from an outside agency, but I felt strongly that this should become a core competency of Michaels.
Would you consider yourself an analytics evangelist?
Given my background, I ooze CRM, so I consider myself primarily a customer advocate. But in order to do CRM effectively, you have to also be a data and analytics advocate. There are few, if any, companies out there where pristine, beautiful data comes magically spewing out of a system—you have to create it. You have to understand the importance of analytics. But as a customer advocate you also have to avoid analysis paralysis and narrow the data to what matters to the customer. What analytics do you focus on so that your customers will actually see a difference?
You’re piloting a rewards program—what early observations are you seeing from the data?
It’s still very early, but we’re finding that customers are accepting of the program and it’s helping us identify valuable customers. We will evaluate the success based on traditional retail metrics, but also on the long-term effect on the customer—this will take a lot longer. CRM is all about loyalty, so you can engender loyalty with or without a program—and that’s what we’re trying to test.