Marketing and Digital Transformation with David Edelman, Partner, McKinsey

Marketing and sales are essential parts of digital transformation, however, the transition to digital marketing can be fraught with challenge. In this episode, McKinsey partner, David Edelman, offers advice for successfully making the shift to digital marketing at a sophisticated level.


Jul 15, 2016

Marketing and sales are essential parts of digital transformation, however, the transition to digital marketing can be fraught with challenge. In this episode, McKinsey partner, David Edelman, offers advice for successfully making the shift to digital marketing at a sophisticated level. 

David Edelman is a global co-leader of our Digital and Marketing & Sales Practices, based in Boston. For more than 20 years, David has specialized in helping marketing executives manage the strategy, organization, and infrastructure transformations required to become “digitally adroit” leaders. From creating digital centers of excellence, to developing marketing technology architecture plans, to redesigning entire go-to-market approaches, David has led work that is both strategic and highly tactical.

Together with the new McKinsey Digital Labs team of designers, developers, and digital analysts, his teams have helped marketers raise their digital traffic volumes, conversion rates, and customer lifetime value. In Financial Services, David has worked across many lines of business, including credit cards, retail banking, institutional banking, and retirement products.

One of the early leaders of Digitas, a market-leading digital agency, David built the Strategy and Analytics team, working alongside the agency’s creative and technology teams on implementation of large scale digital advertising and web ecommerce programs. Before that, as a partner with The Boston Consulting Group, he pioneered early work at the intersection of marketing and database technology, developing their “Segment of One Marketing” strategy service line, and was a leader in developing their E-Commerce practice.

A frequent contributor to leading publications, and a Top 5 LinkedIn Influencer, David has also spoken or participated in panels at many top CMO and industry gatherings. He also sits on the advisory boards of a couple of small agencies and start-ups in the social and video markets.


Michael Krigsman:

Welcome to episode 181 of CXOTalk. I’m Michael Krigsman and today we’re talking about digital transformation and marketing. Digital transformation has become one of the great jargon buzz words of our time. But when we talk about it in terms of marketing what does it actually mean, what does it really mean?

Our guest is David Edelman from McKinsey, he’s a partner at McKinsey and he is so well respected and a great prolific writer, author, speaker that we’re just honored to speak with him today. David Edelman, how are you today?

David Edelman:

Doing terrifically well, thank you Michael and good afternoon or whatever time of day it is to everyone out there.

Michael Krigsman:

That’s right, we don’t know with the digital audience can be folks around the world. David let’s jump in and please share with us briefly about your background, about McKinsey about your areas of focus.

David Edelman:

Sure, so I’ve actually been working in the internet space since way back, since 1991 when the internet first started and one of the major telecom companies asked what would the internet do to their business? And at the time it was pretty shocking when you put together all the statistics for example fax traffic between the US and Asia was 15% of their margin and that was all going to vanish.

So early on starting to understand what the internet was about to do in disrupting businesses really got me interested in looking way more deeply into what this possibly could lead to. So at the time I was with another consulting firm and worked with a number of people and set up an e-commerce pracitce to help companies start to think through how to lay the groundwork for what the internet can do.

Then later on in the 90s, 1999 I was part of the team that started Digitas, now DigitasLBi the interactive agency now owned by Publicis and got a really deep firsthand look at what it took to actually get digital programs going in companies, hands on at the rock face, working with the creative, the technologist, the marketers in the early day of really understanding what websites what search, what display all really meant.

And then about eight years ago I joined McKinsey to help build a digital marketing and sales practice, where we work at a broader level to help companies across all different industries, work through some of the bigger – yes that word, transformational elements needed to ramp what they’re doing in digital marketing and sales. And that includes broad issues such as organization structure.

Moving to digital is not just a question of moving dollars from one channel to another. You really need to think through different ways of operating, structuring the organization, what your relationship should be between what you do in house and with your agencies. There’s new skill’s to build in terms of analytics, technology to put in place. And whole new ways of thinking through the processes by which you run programs in market.

So we’re working in a very hands on ways with clients, to build those capabilities , show proof on concepts of how working differently can actually lead performance. And then helping clients scale what you doing. So it’s not what you might consider to be typical McKinsey kind of legendary strategy organization, recommendations, and PowerPoints. It’s hands on. We’ve got analytics folks, technologists, and designers now onboard to really make clients make it happen.

Michael Krigsman:

So for you, when you are looking at marketing and sales through the digital transformation lens, of course there is a heavy element of using tools and software, but it’s far more encompassing than just the software itself.

David Edelman:

Oh definitely. When you actually get into the core of what digital marketing is about, it’s all about using data to have increasingly personalized interactions with somebody knowing the information you have about them, about their context. And then about having some kind of experience with them that’s going to serve the needs at the moment through the device and in the context that they’re in.

So besides the technology to enable all of that, you need to understand what are the different segments who might need different kinds of treatment. What is the content, what are the different interactions? There’s never an obvious answer right at the start, so there’s going to be constant test and learn.

So having the processes to constantly put a relentless stream of new tests out there, figuring out what to test. Is is timing, is it trigger, is it content, and working through how to get those tests out the door, read the results, optimize them over time. All of that requires different kinds of process setups.

And if you’re working with multiple parties, with agencies, with different media companies, stringing that whole ‘supply chain’ so to speak together for digital experiences can actually be fairly complex. And the key is to really simplify that and work it through so that it’s doesn’t need to be reinvented every time you want to do something new.

Michael Krigsman:

If you’re just joining us were talking with David Edelman, who is a partner at McKinsey and we’re talking about digital transformation and marketing. As we have this discussion, there is a tweet chat taking place with the hashtag cxotalk. So David, given the fact that true transformation of this type involves so much more than just tools. It involves the  processes, the organization, why is it that when you hear about digital transformation, especially in marketing the emphasis is all about software; buy a tool and life will be great.

David Edelman:

Well there are some very big companies out there who are selling pretty important enterprise tools that are critical for enabling digital marketing. And the fact is that large budgets will need to be spent on those tools to make it happen. They are necessary but not sufficient.

And let me give you an example. For one of my clients who’s a fairly large bank, they already have frankly all the digital technology you could possibly want. And in fact most of our clients have way more technology in different parts of their operations bought by different groups that they realize. It just hasn’t necessarily been strung together. It hasn’t been thought about in terms of what is it going to take for example to do a remarketing program.

So if I send an email out to somebody, they click. They land on my site. They look at something then they abandon and I want to reach them not only through a follow up email, but through a display ad. Now that’s fairly routine in a way, I mean remarketing’s been around for a while. But actually to be able to do that accurately and rapidly, because if you don’t do it within 36 hours you might not really need to bother.

you have to string together a number of different tools often to make that work. And sometimes also the people involved are in different parts of the organization. So it’s important to carve the pathway through those tools. So the very fact that we were serving they had a whole mix of tools from Adobe, from Salesforce, Oracle, Google for DoubleClick.

And what we were able to do was to help them lay out for about 15 different use cases of things they would market, what is the workflow, the process, the templates across which systems? What are the connectors that they need to have in place. What’s the data visualization that they’re going to need, and set that all up?

So for each of the use cases, all that technology is essentially in a box and ready to go for them, so that they don’t have to rethink it every time. They need to move fast. They need to be able to get results very rapidly to be able to optimize. And fooling around with this technology every time and needing IT support is just going to slow them down. So it’s important to have that cut through pathway and then the processes underneath to make it work.

Michael Krigsman:

Given all the components involved that when you’re having these discussions who is your counterpart on the clients side? In other words inside a large company who is the right person to be responsible for all of these pieces you’ve been describing.

David Edelman:

You know it varies depending on the structure of the company and whether or not they are more of a marketing brand oriented company, who sell through third party channels, like a packaged goods company, where that’s more likely to be on the CMO side. A more direct sales company, such as a retailer or telecom company or a bank it maybe the e-commerce and channel management side.

But what we’re actually seeing more and more is the increase is coming in at a higher level. It’s usually the General Manager of the overall business because they recognize the value of digital whether it’s to drive direct digital sales or from an Omni-channel perspective to guide people through a journey that may start online or on a mobile phone then go into a physical interaction. The General Managers are realizing this is critical and often involves a number of functions underneath them, so they are looking to ramp the productivity of their marketing, growth in digital sales and so it’s a total business imperative. And they’re mobilizing their teams to do it, even though the day to day execution maybe guided by more somebody on the CMO or the e-commerce side.

Michael Krigsman:

We have a question from Twitter, and Colin Crook is asking about customer experience and the role of substantive content. Now it’s Twitter and I think that’s what he’s asking but it’s abbreviated. But the role of content and customer experience and really good content, so maybe talk a little bit about that.

David Edelman:

Yeah, one of the things that I think has been underplayed in a lot of the written stuff about digital has been content, has been the stuff what actually are the people interacting with. People get very enamored with super high powered analytics and the technology, and the media. But the reality is people need to engage in content, and terrific creative is still often what it’s all about. The greatest programmatic buying is not going to matter unless there’s something that moves people to buy, and often it’s not necessarily just a discount shoved in somebody’s face.

It’s got to be something that connects people to a need that they want to address. So content is absolutely critical, and the role of creatives in many companies is unfortunately underplayed or at many times just outsourced to agencies.

Agencies will always have a role. They’re critical. But within companies themselves they have to understand what the emotional fabric of their brand, and how is that going to translate into the messages and content that they provide.

So content is critical. Content varies though at different stages of the journey. So if you’re in the early stage of just considering whether you’re in market and what are your options, then you need more to help you understand the whole category. So for example one of my clients is in industrial lighting and LEDs are the thing now, and LEDs have completely transformed the market. And the kind of content in the early stage of a journey is really more about case studies. Helping people understand what’s possible with LED lights, showing installations. Showing great things that lighting designers and architects have done. People are shopping for inspiration and learning what’s possible.

Then they click on that and then understand what are the products underneath it, what are the specifications. Then underneath that where can I buy it, what are the service requirements for making that work.

And so there’s a whole flow of content needs through that journey that you need to think through, and it may also vary for different segments. For a construction manager that’s going to be different than for a lighting designer, in the case of the lighting example. So you need to work that through and that part of the planning is to think through those content needs of different segments throughout their journey.

Michael Krigsman:

We have a very interesting question from Zachary Genes, who asks is it the job of the company to define the customer journey or is it the customer that defines the path to purchase. And let me just remind everybody that if you are watching this you can participate on Twitter with the hashtag cxotalk. So again, Zachary Genes asks is it the chicken or the egg. Is it the company defines the customers journey or the customer that defines the path to purchase?

David Edelman:

Well I think you may have read my two articles five years apart. Five years ago when I first wrote about the customer decision journey I framed it in terms of customers coming up with their own journeys and marketers chasing that journey. Understanding what that journey is and trying to chase them to their right place to be. And I’ve come to realize that for an increasing number of types of products, marketer can actually help steer and sape that journey by providing the capabilities that keeps somebody engaged. So let me give you a great example of something personally that happened to me where my journey was clearly shaped.

So about two years ago my wife and I were thinking about buying solar panels for our house and did some looking around online. And actually buying solar panels is not as easy as you’d think. There’s a lot of complications to it, tax rebates, things like that, installation. And so it was just taking us a while but then actually got a piece of mail – yes, hard physical snail mail, that said your house maybe a good candidate for solar power. And I though okay maybe they say that to all the guys and not just something in me.

I opened it up and there was a customer URL of our house, I typed that into my browser, and boom, a picture of the top of my house from Google Earth with solar panels superimposed on my house. it was the right number to fit on my house, and a calculation on the side of how much energy those panels would generate. With a feed from Trulia they were able to figure out the size of my house and could calculate what the likely percent of energy needs were that my house would need. And then it said click here and talk to us. So I clicked and right through the computer like I’m doing now with you, I had a conversation with the customer service rep from Longevity, which was the company that offered that.

And he guided me through and showed me a short video of the process and how it worked, gave em two names in my neighborhood as references, and said contact them and come back if you still want to do it. So I contacted them, got great feedback. Went back to him, he knew exactly where I was in the process and then we went through the whole leasing process and all that, and it all happened.

It was incredibly smooth and I didn’t look at alternatives. The money made sense, the leases seemed economically relevant. And essentially my journey you might say was high jacked, but I would call it shaped because often you don’t know what you’re going to need. You don’t know what it’s going to be like, and I don’t think companies do have an opportunity in many cases to shape a journey through the right kind of capabilities put in.

I think there are opportunities to do that, so I actually encourage companies to think about ways that they can bring proactive data to bare to help somebody see what’s relevant for themselves, automate the entire process end to end and make it incredibly clean to do.

Bring contextual relevance in, so I know where I am in my journey and guide the process right to that, and bring some cool innovation to bare, that captivates me and gets me excited. Those four elements I think are really the ingredients, and when you think about a lot of digital companies, they capture the tension and use those four things to shape the journey. So I think it’s a combination of both, but companies do have more opportunities than they may realise.

Michael Krigsman:

That is an extraordinary story because I’m just imagining for that company to go through is process of communicating with you across so many channels, multiple channels and combining multiple data sources. It’s not just a veneer of marketing but it’s actually a rethinking of their fundamental interaction process with customers

David Edelman:

Yeah, it’s about thinking marketing is helping people through their journeys. So I think of the strategic imperative here is to step back from thinking of marketing as just shoving messages into people’s faces as I alluded to before and saying people want to have some kind of journey, unless it’s an immediate impulse purchase there’s some process that people will go through. And to the extent you can help them through the stages of that journey you’ll be captivating them more powerfully.

So there’s a strategy to think about it. And we think about customers journeys in terms of five steps. There’s first, we actually reuse the term, consideration because we think consideration is considering that you’re in the market for the first time. Well you’re in the market, maybe not for the first time and you’re thinking through what your options are.

Then you do a bit more evaluation. You dig in a bit. You look online, you talk to people, you go to a store. Then you think about what to buy, not only what to buy, where to buy, how to buy, how to configure it, how much to pay, then after that then you experience it. you experience the product, you experience around that product, and what end communications of being a customer. If that goes well you’ll advocate on the brands behalf, which becomes content that can be fodder used for other people’s consideration and evaluation, and if you’re really into it you’ll bond more with that brand. Letting them send you emails. You might download their app. Join their loyalty program, and be more and more engaged with the company.

And companies who we’ve worked with and have actually taken that journey map, laminated it and used that as the basis for thinking through when we launch a new product what’s going to be the whole journey. When this campaign goes out into market it’s not just about the first step about getting people to consider us, how do we take them all the way through, how are we going to carry them through that process. And it may vary by segment. Some may already be very close in with your brands, some maybe be people first coming to market. And so there’s going to be differences for different segments, and you may have to do some analysis to understand which ones are more valuable.

But it is around thinking through a strategy of journeys, and I think that’s one of the most important actual transformational elements to work through and at the same time all of the process stuff has to come into place.

Michael Krigsman:

David, we have a question from Dave Burkhead on Twitter who’s asking about a piece of this, which is how can you translate information gain through digital marketing efforts to traditional channels. So it’s how do you integrate the data together from the two.

David Edelman:

There maybe two different sides to the question on how to integrate data from digital channels and traditional channels. And one thing is that digital channels provide a great lave for learning about who really engages with what kind of content and being able to throw out a whole bunch of tests on YouTube, on social media of low cost content with different kinds of messages. And then looking at the profiles of people who engage with that content can provide incredibly valuable information before you might invest in the right campaign.

It tells you which content resonates, who would be the kinds of audiences to target. All of that can be valuable, and all the more reasons to think about your marketing in terms of faster cycles have been learned. So I think as an input into what to do traditionally it’s very important.

I think also what for many company’s what’s happening in terms of people’s journeys isn’t that they just stay completely online. So for one of my retail clients for example they did a survey in the store of asking people what led them to come to the store, and a third of the people in the store said they had gone to the site within the last two days before going into the store. Well that opened up a lot of thinking about how they were spending against digital. Because originally they had been planning their digital marketing spend against digital sales because that seemed easy and straightforward to measure.

And so it was all return on ads was sales. And their agency was buying against that and everything was plugged to e-commerce sales, but the site was actually an incredibly powerful intermediate marketing channel for the stores. And so they needed to understand different proxy’s to figure out what might be a good way to allocate their budgets so that they could not only drive e-commerce traffic but store traffic as well.

And so modelling over time stated to reveal product page views were the most important thing, were that if you’re able to generate more and more product page views that actually got people looking at the product. Now, you can try to do things to get them to go to the stores and reserve the product, and check on inventory. But in the end still budget allocation perspective; it was about driving product page views. And over time that was an incredibly powerful correlation with store traffic, and they were able to raise total traffic of 3%, and for a retailer that’s huge by rethinking that digital standpoint and putting a lot more money into digital and not just looking at e-commerce sales.

Michael Krigsman:

So you’ve really got to understand the levers that are driving customer action, and you can use the data as the mechanism for understanding that. and you can use and you can run experiments with digital to learn about these things.

David Edelman:

Experimentation is absolutely key. In fact it’s a competitive advantage to be able to do more experimentation to get more data, and bigger datasets in which to do modelling. If you actually think about the core basis of statistics, a lot of correlation are based on understanding how the variant in one thing affects the variant in another. And you need a lot of data and some variance in order to do the modelling.

For example companies are doing media mixed modelling when they haven’t been spending much on digital in the first place, they’ll never spend on digital, because there’s not enough in the model to show the variance and digital spend and how it’s affecting. So you need to do a lot more aggressive experimentation, and that gets into process and organization.

So one of the things that we’ve been working hard on with our clients is setting up more war rooms, where cross functional teams get together. So you’ve got about 10 people who represent marketing, analytics, design, front end development, back end technology, finance. Sometimes legal and compliance, all in a room to start getting the design, the planning , and the execution of programs out the door in rapid cycle.

Very similar to the precepts of agile software development and infact Scott Brinker has a terrific book all about this, Hacking Marketing that explains a lot of the parallels. We’re big believers in this, where this kind of ongoing  constant get things out on the market fast, iterate, test and learn, then scale what works is critical to optimizing things over time.

So if you can’t get it out the door fast, if you can’t get the data back quickly then that slows you down. And you can’t test as much and it’s harder to optimize. So being able to have those muscles to do that fast cycle which has a bit of technology certainly to it, but have a lot more process in it, that’s really critical to driving more effectiveness from your spend.

Michael Krigsman:

On this point Arsalan Khan from Twitter has a question David, and he’s asking when you talk about things like user experience for example, like is it better to hire user technologists and teach them, the marketing, or hire marketers and teach them the technology. Again it’s one of those chickens and the egg, which comes first, the technology or the marketing?

David Edelman:

Well ideally you have them both in a room together and they cross teach each other. I mean that’s mostly the way we’ve done it, and you tend to see is that people who are interested and you know, so motivated and will cross-learn between the two disciplines.

You know you definitely though you have to start with marketing because it is still about the customer. And thinking through the customer’s needs, where they are in terms of what they want to accomplish and thinking about an empathetic point of view what somebody is going to interact with. It requires thinking about the insights, the context, the goals of somebody. And the design has to come from that and the technology has to be built against it.

I think too often it’s easy to start with a technology perspective and build something that’s cool, but it may have too many bells and whistles. It may be too complex. It’s not necessarily empathetic with the context that somebody’s in at a given time.

I’ll give you just a very simple example from marketing technology itself. When you look at a lot of the analytics tools that are out there from many of the providers, from Adobe, Oracle, Google maps, they’re getting way way ahead of where people really are in their capability to use them. They’re extremely sophisticated, they are just amazing what the capabilities are, but for 75% of marketers out there, there’s a lot more basic stuff that they want to be able to have quickly, ready at their fingertips, and able to execute.

And you know thinking about well what’s the fast path there? A marketer would be designing this for the used cases in mind for most of the people out there and giving them simple ways to execute, and then having paths to be able to do the more complicated. And I think that’s one of the things we are actually helping our clients do, and I think the technology firms are starting to recognize that and they’ll get there.

And it’s not meant to be critical per se, but it’s very easy from a technology point of view to overload the user, and I think that’s something in marketing especially you have to be really careful to avoid.

Michael Krigsman:

It’s really interesting to hear you talk about this balance between the technology and the business drivers, and the relationships to the customer. It seems like that balance is very hard to achieve and many companies make the mistake of being too tech orientated, so then they don’t achieve their business goals. But we have another question from Twitter, from Connie Woodson, who asks, she’s looking for advice on predictive analytics. So when should you use predictive analytics, why should you use predictive analytics, when doesn’t it make sense? So tell us about predictive analytics in this context.

David Edelman:

Okay, well predictive analytics, I mean that’s another term we could call a buzzword, but there’s two ways to think about predictive analytics. One is trying to predict who are likely to be the best responders to some kind of situation that you’re going to provide. So being able to build lookalike models of some kind and find those people either in your own database, or in third-party databases and use that to target your messages. Sometimes that can be based on static information, so finding people who fit certain types of profiles. But increasingly it’s going to be about finding people who were in a specific context in the moment. Sometimes may be unexpectedly, and using that to figure out how to reach them and send a message.

There is also the predictive analytics, which is looking at an overall campaign, if you do this kind of a program that’s based on good models, that’s at a certain scale, with a certain budget, what should you be able to sell. So it’s somewhat forecasting it, and predicting what should be the impact of something if you actually do it at scale. So there are faults with those. I think more commonly it’s the former, which is building models to actually find people individually, and being able to do that at scale.

And I think predictive modelling is going to be extremely important going forward for more media buying, especially as TV and cable become addressable. Already we are seeing Canada offering addressability on more and more of their cable base, which probably makes Canada going to be one of the leading markets where programmatic buying, which is the ability to target and pay for individual impressions on an auction basis based on data. So that’s programmatic buying in a nutshell, being able to do that very broad scale across not only traditional digital, but also increasingly traditional channels that are becoming digital.

And having those kinds of models to be able to find new kinds of predictors of people who would be in your market is going to be very important so that you know where and how to bid.

So, let me give another example here, so that for certain kinds of companies, so let’s say a telecom company they may want to understand people who are in the market for a phone, but could not probably afford a high end phone. And they may have a lot of inventory of older phones. So they want to be able to target the people who would want to spend less on a phone, and who may also not have the credit to be able to buy a high end phone. But they don’t want to spend money to run credit bureau reports, so what are the predictors to be able to find those people and provide them with content.

And you know, that’s going to be people who stream from certain sites, people who interact with certain kinds of content, or probably more likely to have that proclivity, and so they can market great deals on lower end phones to those people. And that would be the kind of example where predictive modelling would make sense.

Michael Krigsman:

We have about 10 minutes or a little bit less remaining, and so when we think about digital transformation technology of course comes to mind first, but as you have been describing it’s really about the customer’s needs and the businesses ability to be empathetic and organize itself in order to meet those customer needs. And there is a word we have for that, which is communication is a very important part of it. You’re a consultant, that’s what McKinsey does, and so would you share some of your thoughts from a consulting standpoint for helping the effect of these kinds of changes successfully in our companies.

David Edelman:

Sure I think one of the things that mobilizes companies to take action, mobilizes people, mobilizes all of us are stories and you need to put together stories. Stories of what your customers currently would like to accomplish, and why they would in terms of the context of their lives. And what are the compromises that they’re making now, stories where they just can’t get things done. And then what comes of the story of how you can break those compromises. Because often value is created when you can break compromises that people are facing, when you can make it easier and if you certainly think of the major digital companies like Uber, they broken great compromise, a huge compromises about transportation.

But even you know, the airlines you know breaking compromises of meaning paperless tickets, and being able to do everything from completely with a mobile phone end to end and then if your flight is delayed, being able to use intelligence to immediately put you on to which ever flight they can, so you don’t have to wait in-line with you know 50 other people to get put on another flight.

And so breaking compromises is critical and that’s going to come from stories. And you’ve got to do some journalistic poking around to get those stories. It doesn’t always come from data. You’ve got to get out and talk to people. Talk to consumers; look at it from their shoes. It’s shocking to me of how few marketers or peoples within organizations have actually gone through their own buying process and taking on the persona of different types of people and actually see what it’s like.

So you’ve got to get into the customer’s issues and use that as the rallying cry for driving change. Everything will come if you can match what the customer really wants to do. So, turning those stories into compelling videos and vignettes and creating personas around them, and then designing to suit the needs of those individual people, that’s what’s incredibly powerful.

So coming back for example, to the industrial lighting company, they really sold mostly through distributors. They didn’t know their customers that well, so going out and actually talking to lighting designers and architects revealed that they’re online extensively, and they’re in social media forums asking all kinds of questions about design, about energy efficiency. And they were very specific forums where these questions were being asked. And there was no other manufacturers who were in those forums asking questions when the OEM often had better information than the customers. And so they decided to create a social media focused forum, I know it’s an overused term. They basically set up for people who monitored those forums, and make it very clear that they work in manufacturer, but they could provide actual answers to the questions.

And as they did that, it brought more and more information back about what people were looking for, what case studies led them to create more case studies, and change the whole way they marketed it’s because they had that customer insights, those stories that they were able to tell. So that’s the most important thing is the stories.

Michael Krigsman:

Telling the stories but understanding your customers stories, but if you want to drive change inside an organization and be a change agent you need to be aiming this inside as well, isn’t that so?

David Edelman:

Yes, and so then there are stories from the inside out, because then there’s well what does it take to actually make something happen. What are the things we’ve got to address in order to solve that particular problem? Are there policy issues that get in the way? Are there organizational structure issues that prevent this? Are there things in our technology that are preventing us from doing stuff?

So yes, it does require a journalistic approach internally to start addressing what are those capability infrastructures organizational issues to address, and brining that to the fore. There again, telling a story of what would it look like if we broke those internal compromises as well. I think it’s on both sides and bringing that together.

But just simply saying, we need to get four x times the current digital volume that we have now. Well that’s a goal, that’s import and and you know certainly something that for many companies is economically critical for them to do. But it’s not necessarily going to give people enough of the how and the why, and empower them to understand where to take action. So under that goal needs to be a vision of how the operation and the story both internally and externally would change.

Michael Krigsman:

David Edelman from McKinsey, we have just a few minutes left. Now we’ve been talking about relationships inside an organization. What about the relationship between in marketing and technologist or between CMO and CIO there could be tension there, how does that get resolved, or what’s the right relationship? Any thoughts on that?

David Edelman:

Yeah, I mean when I was talking about war rooms before, one of the most important things that happens within digital especially when you’re doing fast cycle, you’re getting people from a number of different functions to work closely together. So in a tightly functioning digital marketing world, you will have technology people and marketing people sitting side-by-side, and I mean literally sitting side-by-side in the same space working together. And on the ground, helping each other solve problems and not handing it off but in real time together.

And similarly CIOs and CMOs need to spend more time together. Now a huge chunk on what a CIO needs to focus on is the maintenance of the infrastructure, keeping the cost down, there’s a lot of pressure to do that. But if marketing has the budget and the ability to be a clear client for the CIO, where the objectives of the CIO are just cost performance, but also the support of the life of marketing and those objectives are shared, then you have a dramatically more productive relationship.

And so where the leadership team around the General Manager gets together on a regular basis with a shared goal in mind of how they want to transform the company, and work together to problem solve and address issues like funding, resource allocation, policy, things like that it does take a cross functional team to work closely together and it’s really upon the top leadership to bring folks together to make that happen.

Michael Krigsman:

Well, we are just about out of time unfortunately, and Pisa Rose, a listener on Twitter says that she could listen to David Edelman from McKinsey speak all day because he’s a deep thinker. And David thank you for taking so much time today with us.

David Edelman:

Thank you Michael.

Michael Krigsman:

It’s been really a pleasure. Next week on CXOTalk we are going to be joined by Steve Miranda, who is the Executive Vice President of software applications at Oracle, so he’s going to tell us about what Oracle does and talk about software development.


Companies mentioned in today’s show:









Scot Brinker’s book: Hacking marketing


David Edelman          



Published Date: Jul 15, 2016

Author: Michael Krigsman

Episode ID: 363