Zeta Global, the AI-powered marketing cloud, has published a Forrester Consulting Opportunity Snapshot titled “Marketers Must Shift Their Understanding of Customer Value to be Forward-Looking.” This study, completed in February 2024, provides insights from customer engagement strategy decision-makers in the US and UK. Commissioned by Zeta, the study explores how marketers assess and apply Customer Lifetime Value (CLV) and highlights the necessary changes to adopt a predictive and holistic approach in the era of Generative AI.
The Disconnect in CLV Application
- Tracking vs. Strategy Application: While 81% of organizations track CLV, only 37% actively incorporate it into their strategy, and a mere 14% maximize its potential in marketing investment and execution.
- Implications: This gap indicates a critical issue in how data is collected and utilized to inform proactive decisions that enhance customer engagement and drive business growth.
The Role of Generative AI
- Backward vs. Forward-Looking Data: Traditional digital marketing suffers from slow data movement, leading to backward-looking KPI dashboards. Generative AI can revolutionize this by providing real-time, predictive insights.
- David Steinberg’s Insight: According to David Steinberg, Co-founder, Chairman, and CEO of Zeta Global, AI and Generative AI are set to become central to modern marketing strategies, enabling marketers to leverage data integrity, sophistication, and speed for better customer experiences and higher returns.
Key Findings from the Study
- CLV Metrics and Strategy: Despite the ability to track CLV, a small percentage of organizations effectively apply it to their customer strategy.
- Increasing Priority of CLV and Profit Metrics: Organizations are beginning to prioritize CLV and revenue per customer over transactional metrics that offer only historical snapshots.
- Importance of Martech Ecosystem Alignment: 83% of respondents emphasized the need for integrated and aligned marketing technology ecosystems to drive business success.
- Departmental Alignment: Only 19% of organizations are fully aligned across functions, with marketers often least aligned with data science and analytics departments.
- Focus on Predictive Value: 53% of respondents expect marketing to have more influence on business strategy by applying forward-looking profit metrics to their customer value strategy.
The Forrester study commissioned by Zeta Global underscores the necessity for marketers to shift their understanding of CLV from a historical to a predictive focus, leveraging Generative AI to enhance customer experiences and drive greater ROI. As marketing strategies evolve, the integration and alignment of technology and departmental functions will be critical to achieving business success and maintaining a competitive edge in the market.