CX Decoded caught up with Kathleen Schaub to discuss marketing and customer experience in a volatile world with lots of change.
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Content is king.
That was the saying marketers repeated to themselves for years. And while that sentiment still rings true, there’s something more important brands must pay attention to, something that content ultimately feeds into: customer experience.
Modern consumers have high expectations, and brands go to great lengths to meet — and surpass — these expectations. But that task becomes more and more challenging as we continue to market in a VUCA environment — one that’s volatile, uncertain, complex and ambiguous.
Kathleen Schaub, writer, advisor and CMSWire contributor, has some advice for leaders looking to navigate these rough waters and deliver exceptional CX. She caught up with CX Decoded’s Dom Nicastro and Michelle Hawley to discuss navigating customer experience and marketing through constant change.
Note: This transcript has been edited for length and clarity.
Dom Nicastro: Hello, everyone, it’s great to be here today. Dom Nicastro here, managing editor of CMSWire. I am joined by my co-host today, CMSWire Senior Editor Michelle Hawley. This is CX Decoded. Hi, Michelle. How’s it going?
Michelle Hawley: Hey, Dom, it’s going good. I’m happy to be back.
Dom: It’s great to have you back. No Rich today, which is great. No, I’m just kidding, Rich. He’s gonna be listening to this later. So, just totally kidding, boss.
No, it’s good to be with you again here, Michelle, rockin’ and rollin’. We are gonna get right into talking about our guest today. I don’t want to waste any more time.
Michelle, who do we have on today?
Michelle: Kathleen Schaub is a new CMSWire contributing author, a writer and advisor on marketing. She led IDC’s CMO advisory practice for nine years. And previously, Kathleen was a CMO and held other executive-level positions at leading tech companies.
Kathleen Schaub: Glad to be here.
Dom: It’s good to have you, Kathleen. And pretty much hashtag legit right there, Michelle. That’s why we have Kathleen as one of our new CMSWire contributors. Thanks, Kathleen, for joining the CMSWire.com author family.
Kathleen: Well, I’ve been excited. I’ve only contributed, I think, one that you’ve published and one that’s coming up. But look forward to many more and the conversations with your audience as well.
Dom: Yeah, exactly. And I love the topic that you wrote about, kind of made it the focus, you know, of this podcast. So, talk more about it. We’ve got a video with you in the article on cmswire.com, and now here we are in a podcast. So we’re really running the gamut here, Kathleen, on this topic.
It’s so timely. I mean, we’re looking at such a changing world in marketing and the whole world, really. I mean, we thought, oh, the pandemic is over. Now it’s back to normal? Not even close. Supply chains, inflation, gas prices, war, political unrest, division — and all the while, marketers are sitting there inside a brand, wondering how do we respond? How do we adapt? How do we adjust? Is it even possible, right?
So that’s what we’re going to be focusing on today, for the most part. And I would love a little more background. I know Michelle gave a nice thorough introduction there. But you are a passionate marketer, particularly passionate about the CMO position. I’d just love to know how you arrived at the spot you are today, Kathleen?
Kathleen: Well, again, thanks for inviting me. So I spent the first 13 years of my career in marketing for a reseller. So I was in retail, basically, starting as a one-person department and then growing with the company until we were the largest US reseller of over $2 billion in revenue. And I grew with the company and eventually became CMO.
And it was such a fortuitous beginning for a career, I had no idea, because I was working smack in the middle of the whole market system. So I got to see how marketing affects the whole value chain. You know, especially I was very focused on the benefit of what great sales and great customer experience were, because basically, when you’re in retail, that’s what you have to compete on.
But then I wanted to do something new. And I moved all the way to the other side, to the software industry. And I led marketing for various product and service lines for two great companies and then finally got to IDC, where I was able to put the whole picture together for my clients. And it gave me a really good background for the kinds of things that we’re going to talk about today.
Living in a VUCA Reality: Volatile, Uncertain, Complex, Ambiguous
Michelle: Kathleen, you talk in your CMSWire article about us living in a VUCA reality: volatile, uncertain, complex, ambiguous. It’s been such a wild three years. What challenges and opportunities have marketers faced through all of it?
Kathleen: Well, the last three years have been super extra VUCA. So let me unpack that term a little bit because it kind of sets the stage for a lot of conversation about what marketing needs to do in order to become, really, to be able to handle what’s happening in the world.
So VUCA or V.U.C.A., is an acronym that stands, as you said, Michelle, for volatile, uncertain, complex and ambiguous. It was coined in 1985 by two university professors. And how I learned about it was that it was adopted by the US Army War College to describe the post-Cold War military environment, and it was written about in a book that I really highly recommend, which is “Team of Teams” by General Stanley McChrystal.
And everything in nature, everything about people is VUCA. And marketing is what scientists call a complex adaptive system. So it’s a lot like the stock market or traffic or a natural ecosystem. It’s constantly changing. And marketing gets its unpredictability from the feedback loops that bounce between the billions of independent agents that are out there — customers, competitors, social networks, partners — and it’s these feedback loops bouncing back and forth that cause those VUCA conditions. And those feedback loops are why marketing can be crazy.
Why does a customer journey look more like a child’s scribble than an orderly funnel? Or why do campaigns bump along for months, and then suddenly, they take off or fail? These kinds of things are related to the fact that these feedback loops, this complex adaptive system, is always at work in marketing.
And some of the challenges in the last three years have been specific aspects or context, if you will, of those feedback loops. I mean, obviously, the pandemic contributed to work upheavals and new business models, etc. But the general challenge is that the world is getting more VUCA, and that’s not going to slow down. It’s very complicated as to why it’s getting that way. But that’s the reality that marketers have to face in one way or shape.
The good news is, the opportunity is, that leaders in turbulent environments for the last few decades have been discovering new ways of thinking and working that help us to be more agile, innovative and resilient. And that’s the opportunity, is the opportunity is to become more agile, innovative and resilient. Because we don’t know what’s going to happen next. And that’s the only way you’re going to learn to thrive, is if you develop these new types of capabilities.
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Dom: Thanks for laying the foundation there for the VUCA reality that marketers are going through right now. And it’s absolutely insane what they’ve been through the last three years, what everyone’s been through.
Bottom line is, you come out of this healthy and okay, that’s a good thing.
But when you’re talking about marketing and brands, in early 2020, we know those big challenges. Okay, how do you do more with less? Should you focus on acquisition versus retention? Things like that. Empathy. What’s your message to your customers? Are you feeling their pain? You know. Are you delicate? Are you sensitive?
Kathleen, we’re in the summer of 2022 now. What do you think, you know, the marketing leaders you’re talking to, what’s really top of mind now for them? Now that the pandemic, I don’t want to say is behind us, but you know, we’re kind of coming out of that part of this, what are challenges that are top of mind right now?
CX in a VUCA World
Kathleen: Well, if they’re smart, CMOs and marketing leaders should be focused on customers and customer experience because when you’re in a VUCA world, and you’re particularly paying attention to what’s happening in that dialogue that you’re having with the marketplace, the changes that customers are going to be going through, you’re going to have to react to more quickly.
You can’t depend on what you knew in the past to be what you’re going to do going forward. And so the only way that you can do that is to really, really focus on listening to the customer and joining in that dialogue with them.
And that’s going to take, in today’s digital world, a lot of heavy lifting, through technology, as well as learning to really utilize the best things about all the people that you have that are involved with customers at the edge of the company.
Michelle: Kathleen, you talk about keeping CX top of mind as we go forward. And we keep hearing more and more that customers, they don’t want to hear excuses when it comes to COVID anymore. They don’t want to hear about supply chain issues. They don’t want to hear about companies being short-staffed.
So, you talk about having a dialogue with customers. How can companies appease customers that are so frustrated because of COVID, they have this big challenge with CX where customers are coming in already frustrated, but these challenges aren’t going away.
I guess my question is, what can companies do to still make these customers feel like VIP customers?
Kathleen: Well, I think that it’s probably a good idea to reach into the crisis management bag that certainly public relations and other communications professionals have used for years, which is being empathetic to what’s going on, admitting what’s happening in the real world and being able to demonstrate that you’re making progress in the areas that the customers really care about.
So this is a time when it’s not about the product, it actually probably never should be just about the product. But really trying to empathize with what the customers are going through, and demonstrating that you are really putting some effort towards solving the problems that they really care about, as opposed to what maybe used to be your goal.
Dom: Yeah, and solving those problems in a quick fashion. I mean, I’m just going through a lot of bad experiences right now, with a furniture company. It’s been like two and a half months. And I have to call them and talk to them. My wife’s asking me, did I call them or do they answer? You know, I’m the kind of guy who just wants someone to just do it, you know, and I can just maybe chatbot them and say, “Can you do this? Yeah. All right. Bye. I’m going back to my life.”
And it doesn’t happen, you know, because I think a lot of customers are really stressed for time right now. And you’re trying to market to people that just filled up their gas tank for 95 bucks versus 35 bucks. Right, Kathleen?
Kathleen: Yeah, I just bought an electric car. So, I’m feeling pretty good.
Dom: You got it at the right time?
Where the CX Process Breaks Down
Kathleen: I did. I did.
But you’re absolutely right. And I think in the article that I wrote for CMSWire, one of the things that I was talking about was about AI and how that might help some of this.
And I think that one of the aspects that you’re talking about, Dom, about getting kind of caught up in the convoluted processes that companies often have in conjunction with working with their customers, that is an area where a tremendous amount of improvement could be made.
When you’re talking about what customers need, they are truly VUCA. And you cannot predict what they’re going to need next. So you have to be able to develop processes, and the technologies that go with it, that can handle that kind of volatility.
And that requires a combination of technology and people. Because people are fantastic (as much as we hate unpredictability). We’re actually really super great at working with it because we can figure out those nuances, and we can problem solve and we can innovate. And customers hate it when they can’t get to a person to solve that problem.
So, I think there has to be that combination of using technology for what it’s good at. And then making sure that there are competent people that are involved in that process if things don’t go well.
Dom: Yeah, and I hate when I see these poor frontline people, like a pharmacy experience I had recently. An older gentleman walked in and said, “Can I please get my booster shot?” And they said, “No, you don’t have an appointment.” I mean, this is the elderly population, the ones that are at risk for dying from this disease and illness and virus. And they rejected him. He said, “What if I don’t have a computer, I don’t really know how to.” “I’m sorry, you have to sign up online, you have to sign up online.” That was the canned response.
And I’m sitting there watching this unfold. I grabbed the guy, and I signed him up on my phone for him. We sat there, we did it in five minutes. That’s beside the point. Brands are not empowering these frontline workers to set aside time for everybody to have a great customer experience, not just the online people who want to do it and make it easy.
So to your point, Kathleen, that was a huge example of people and technology where technology got in the way. It made the process worse because you really made someone go through a poor, poor customer experience in that way.
So my response to you, Kathleen, is people do get in the way sometimes.
Kathleen: I am not a person who blames people generally. Again, maybe this is coming from my background where, you know, I mentioned that I started my career in retail and, you know, lived with people on the frontlines. And generally, it’s not the people.
Generally, it is the way a company is set up and the motivation they give to their people. I think maybe I’m an optimist, but I think that people generally want to do good, and they want to be helpful. Most people, I think, particularly if you’re going to be attracted to a frontline type position.
But there are things that companies do, like locking people into a situation that’s very hierarchical, where you have, you know, the people at the top have to make all the decisions for the people at the bottom. You know, I remember one time, to keep going back to my retail background here, we had set up this new delivery process, and something had gone wrong. And on the first day, the customer at the top of the list got all of the morning’s deliveries.
So here they were on their receiving structure or whatever, then this big truck comes in and loads like way, way more equipment like for, you know 10 customers or whatever on there. And they were like, “What the heck.” And then we went back later to do some troubleshooting, and there was an administrator, and she says, “Well, I knew that was going to happen.” And we’re like, “What? Well, why didn’t—” She said, “I thought somebody higher up the chain was going to solve that problem.”
And we’d realize that we just missed this huge opportunity because it’s generally the people at the edge of the company that are going to be able to solve a lot of those customer problems and are going to be really customer sensitive. And one of the major strategies for working in a VUCA environment is to empower the edge.
And whether you’re doing that with technology or knowledge, you don’t want that top-down command and control kind of structure in a world that is moving as fast as this one does.
So I’m a big fan of people at the edge. And I think leadership and organizational structures and things are what caused the problem much more so than the people.
Dom: So you’re saying that one customer got like everybody else’s deliveries that day?
Dom: Yeah, if that came to my house, Kathleen, Michelle, I’d say “Oh, that’s normal. That’s my wife’s orders for the day.”
Michelle: Lucky customer.
Kathleen: That was me in 2020. But I’ve kind of slowed down, I think, I don’t have as much Amazon on my front porch as I did before.
But we want to go back to the question about the different challenges that marketers are going to face in the next few years. Well, maybe just few months, hopefully.
But I think the question of ROI is going to get, probably is already getting, more intense in a lot of companies, particularly if we go into a recession, hopefully short.
Because, as money gets tight, the marketing budget is often one of the few, if not the only, I’ll call it, quote, “non-committed budgets in the company.” So, for example, most of the money in most companies is capital, expenses or payroll, and there isn’t a lot of flex room for a CFO to move around. And so, a lot of times, it’s the marketing budget that gets cut, or at least gets under scrutiny when things are tight.
And in today’s world, with all of the digital interactions that we have with customers, marketing is becoming much, much more important. Marketing is often not only the first touch but often the major touch. I mean, the amount of time that salespeople spend with customers continues to decline, and ROI in a VUCA environment, at least traditional ROI, is almost impossible to calculate.
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Empowering Employees at the Edge
Michelle: And marketers are already facing so many challenges, Kathleen. I can’t imagine having a slashed budget on top of it.
I wanted to circle back to your story a little bit. You talked about empowering employees that are on the edge. What other VUCA solutions can you tell us about?
Kathleen: Empowering employees at the edge is very important and requires some organizational shifts in order to have it happen right. What is useful is to create multidisciplinary teams working at the edge so that they are able to solve more problems on their own without having to go back to the corporate office to solve them. So, there are some other organizational things that will go along with that.
Another thing that is going to be very important is the amount of intelligence, because you can’t really have the people at the edge be empowered if they don’t know what’s going on. And so this exchange that needs to happen between what the edge knows and what the edge is good at, and then what the back office, if you will, or the core of the company knows. So a lot of times, the business analysts and the intelligence and IT people and stuff are back at the core office. So being able to set up this exchange and make that conversation very, very intelligent and rich so that the people at the edge know what’s going on.
So, for example, Dom, when you were talking about the old gentleman that was trying to get his vaccine, wouldn’t it have been great if those people at the edge knew who he was and knew what his situation was so that they could make a decision about whether or not to interrupt their traditional ways of working to help him?
Kathleen: So intelligence is hugely, hugely important in that task. Another thing that I’m very, very bullish on is agile. So there are so many different ways of working, being able to organize work in a different way. That whole iteration of change, test, learn, adapt — extremely, extremely valuable in high change, unpredictable environments.
Dom: Yeah, such good layers. They’re good foundational concepts of how to empower the whole team so that that older gentleman didn’t have to go through what he went through. I’m sure they didn’t say in their meetings, “Oh, maybe Dom Nicastro will be there. He can sign them up for them, right?”
So, what’s the problem there, Kathleen, because you know that that pharmacy, which is a huge, huge chain, by the way, they were in the office trying to figure out how to do vaccine signups, and they went to the website, probably a vendor came and gave them an outstanding demo, it looked great, it was easy. Have you had COVID symptoms? No, here’s a sign-up. Here’s the availability, boom, done. So convenient.
What they failed at was they didn’t walk through every scenario of some human being wanting to get that vaccine, right?
Kathleen: Dom, they’re not going to be able to walk through that because it’s VUCA, they do not know what the next person who walks into the door is like.
I liken it to working in a restaurant, where you’re, you know, cooking in the back, your chef or whatever, you don’t know what that next person who comes in the door is going to order. So you can’t pre-think every single thing. Okay, you have a menu, and that’s gonna give you your most popular, or kind of set some context. But you don’t know what that next person is like, maybe they have an allergy to gluten or something. You don’t know.
And that’s where you need to develop those processes, those hybrid processes between technology and people that will allow you to flex as those unexpected things come up, because you just cannot predict.
You might be able to get some degree of probability. You might be able to say, “Well, we know that in general, we’re going to have this many people come in to order chicken,” or whatever. But you don’t really know. That’s kind of the goal, is to set up the business, both from a people and process and technology view, in a way that allows you to be agile and resilient and responsive to customers.
Dom: Yeah, just accounting for that scenario, and empowering that young woman who had to tell this older gentleman, “I can’t sign you up,” because it was not her fault. She could not sign them up. They did not bake in that scenario of a walk-in, which is astounding to me that that wasn’t accounted for.
Michelle: They’re not the only ones, though, Dom. You know, I was doing my local taxes. And the only option I could find to file is online. And I searched and I searched and I searched for a paper version. And I’m thinking, if I was an older person, I didn’t have access to a computer, I would be so frustrated right now, I wouldn’t know what to do. And I’m pretty tech- savvy. And it took me maybe two hours to find the paper version that I could then mail in to file.
Dom: Are you asking the Internal Revenue Service to improve its customer experience?
Michelle: Well, I definitely think they should. I have a lot of comments on that, Dom.
But my point is just, I’m still amazed that we’re in this digital-first world, but we still have people that don’t have computers, especially the older generation. And it amazes me that these big brands, like you’re saying, are completely counting those people out.
Dom: Kathleen, you give us a lot to munch on with your answers. So we appreciate it, you’re stirring the pot, we’re getting all riled up over here. So that’s a good thing. That’s a real good thing.
So to go back to the article, because it was so good, so many good actionable tips there. And one of the things you said was talking about, you know, to go through these turbulent times, marketers will benefit from tapping into their, quote, “uniquely human qualities.” And you kind of touched on this a little bit. So, things like AI will always be there for support. But these qualities can endure, too, these human qualities.
So, how about some examples of that, where the human part of marketers can really come in to help.
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Kathleen: It’s an important topic to bring up because as we get more and more into using technology and marketing, the jobs for marketers in the future are going to be ones that are very heavy in these very human areas.
So we kind of touched on them, but things like creative thinking, judgment, social skills, innovation, problem-solving. Humans are great at solving the problems that we never saw before, whether individually or collectively, like taking your issue with the older gentleman and the vaccine. I can guarantee that there were five people in that store that knew exactly how to solve that problem if they had been empowered to do so, because that’s what humans are good at. We’re good at the nuance, we’re good at being able to say like, “Hmm, maybe I could put some duct tape on that,” you know, we’re good at that kind of stuff.
So those are the kinds of skills that we want to make sure that we ourselves have as we move forward, and that we really foster those skills, as well as those of our teams. Those are going to be the ones where the people are going to be able to excel.
Michelle: We talk about how these human qualities, when we mix them with technology like AI, can offer a lot of benefits. When it comes to a VUCA environment specifically, how can marketers use AI to better predict what’s going to happen and to better market to the people?
Kathleen: Well, let me put AI a little bit to the side, because that’s one technology. But it is important to recognize that the ways that technology is used, particularly data and analytics, are different in a VUCA environment than it is in a more predictable kind of a machine environment.
And also, going back a little bit to the ROI question. Because VUCA is probabilities, as opposed to certainties, one of the things I like to say is your marketing is not a vending machine, you don’t put your money in and, you know, out pops revenue. And ROI calculations are generally geared towards trying to determine whether the bag of M&Ms is more valuable than the bag of potato chips.
But marketing doesn’t work that way because every situation is a little bit different, all the boundaries. I mean, we don’t have bags of potato chips, we have, you know, customer loyalty, you know, meaning lifetime value. Where does the money end? And so the types of analytical and intelligence technologies that are important to use in VUCA situations are ones that are more like working in the world of social science, or really any kind of science in general. Things like, first off, lots and lots and lots and lots of data.
There are so many patterns that exist in the world of marketing. I mean, we know some of the slower types of patterns, like sales, seasonality or technology adoption curves. But there are all sorts of other patterns that exist in customer journeys and in campaigns and social media and things like that. But the way that they need to be looked at is more like you’re trying to predict the weather as opposed to trying to figure out whether or not a bag of candy is going to come out of the machine.
So, it’s more like multi-variant regression analysis, for example, which is marketing mix modeling. Those kinds of technologies that, instead of trying to look for a discrete finite answer, they tell you, are you going in the right direction? Are you getting better or worse? And by how much? And what’s the probability that that’s going to happen?
It’s those kinds of more sophisticated ways of analyzing and using technology that are going to be more valuable in the VUCA world than maybe some that we’ve been used to.
The Risk Side Effect of AI
Michelle: Beyond all these benefits, though, there are definitely some risks when applying AI, and some of them you’ve written about for CMSWire. Can you tell us a little bit about those risks?
Kathleen: Yeah, so the risks of AI, first off, super, super powerful. And anything that’s really powerful is usually going to have, you know, big opportunities, but also big risks.
And the big risk that I see for AI, at least in the short-term, is that we might be too complacent about how AI works, and how much work is going to be needed in order to be able to manage it well for marketers.
So, for example, a book I read, that’s called “Superintelligence” by Nicholas Bostrom. He was writing about a model that they created, a simulation where they were trying to determine an AI for automatic cars. That model was geared towards trying to give the task of ferrying a passenger to the airport as quickly as possible. And the model did that, but at the same time, it ran over a whole bunch of pedestrians in the way, because AI is very, very narrow. And as a consequence, it can pick up all of our biases and, you know, do strange things if we aren’t really, really good stewards of that. And I think marketers have to get great at being stewards of AI.
Dom: Hello, Microsoft’s Tay, the bot that went on a racist rant on Twitter. They were mimicking what humans do. You want it to be more human-like? Well, there you go.
Kathleen: Well, I’m going to disagree with you a little bit on that, though, because AI is not like humans.
I mean, the media and the culture and stuff want to sort of set it up as though, like, you might have seen the movie “Her.” I think it was like 2014, or something, where Scarlett Johansson was this amazing virtual assistant.
But AI is not like that at all. It’s very, very narrow, and very restricted. And it only knows what it’s been programmed to do.
And we may be making this assumption that, like, AI could assume, like knowing, that you’re not supposed to be racist, or you’re not supposed to be bigoted or you’re not supposed to change a particular something in your inventory system, which makes the products less profitable. It doesn’t understand what humans understand. That’s a big, big flaw, but it’s our flaw. Not AI’s flaw.
One Big Takeaway: Accept VUCA Nature of Marketing
Dom: Kathleen, let’s bottom line this as we’re getting to the end here. Marketing in a VUCA world: what’s your big takeaway from this podcast, if you were talking to any old CMO at a lunch table at your next conference. And let’s hope you’re getting out there too now, now that things have eased up a bit.
Kathleen: I think there is one big takeaway, and that is to accept the VUCA nature of marketing and to recognize that a lot of practices that we all learned in the early stages of our career, and that our companies are based on, a lot of these practices are not only not appropriate for VUCA, but they actually get in the way.
The things that we’ve talked about, you know, the organizational structure, the lack of power at the edge, the misunderstanding of the way that value is judged in marketing, all of those kinds of mindsets have to first be accepted.
And then, it opens up the world to reinvention. Then you can start to look at: why do we go for agile? Why do we put empowered multidisciplinary teams at the edge? Why do we improve the way that our intelligence works and adapt our processes and our methods for analytics to new ways? All of that starts to make sense. But it has to start with that core of accepting that we’re not in control, and that’s okay. We can thrive anyway, humans are made for that.
Michelle: Thanks, Kathleen. That’s a great takeaway. I think humans are definitely used to being in control, and letting go of that is hard to do.
But we can’t thank you enough for sharing your insights with us today on CX Decoded. We want to give you an opportunity to share where our listeners can follow you and connect with you online, besides your content on CMSWire, of course.
Kathleen: Well, they can certainly go to my website, which is kathleenschaub.com. And I’m most active on LinkedIn. So happy to LinkedIn with any of your listeners. And I really enjoyed the conversation. Thank you.
Dom: Sweet, as did we. Thanks, everybody, for joining us today. We hope you enjoyed the discussion on marketing in a volatile world.
We look forward to providing you with many more insights and conversations around marketing and customer experience and upcoming episodes of CX Decoded. Thank you very much, Kathleen.
Kathleen: My pleasure. And thank you, Michelle.
Dom: Dom Nicastro signing off. Have a great day, everyone.