Learn more about these two similar yet distinctive roles to help decide which one can best help your retail organization meet its customer-centricity goals.
As the position of chief customer officer (CCO) becomes more common in retail organizations across the country, is it — or should it be — replacing the vice president of customer relationship marketing (CRM) role? Not necessarily.
While there is overlap between the jobs, there are some distinct differences, as well. And the positions aren’t equally appropriate for every company. We’ll help you understand these disparities and similarities, as well as potential advantages and challenges to choosing one versus the other. All to help you determine whether a CCO or a VP-CRM is right for your needs today — and in the future.
First, do you really have to choose?
For most organizations, the answer is yes, you need to choose either a CCO or a VP-CRM. That’s because their essential function is the same: To act as the company’s advocate for the customer. A retailer would have to be quite advanced on its customer-centricity journey to have any need to split this responsibility into two distinct roles.
The Basic Definitions
While any given organization may create its own job description, this is how we defined the roles for one retailer:
VP of CRM
Sometimes also known as VP of customer experience. Responsible for leading customer-centric initiatives and keeping the organization focused on the customer. Reports to VP marketing, who reports to CEO.
Chief Customer Officer
Also known as a chief customer experience officer. A member of the Executive Team (a.k.a., the C-suite). Provides a comprehensive and authoritative view of the customer, and creates corporate and customer strategy to maximize customer acquisition, retention and profitability. Reports to the CEO.
Advantages and Challenges
Each role has certain benefits and drawbacks. Here are a few key factors to consider.
- Disruption. Generally, introducing a new VP is considered less disruptive to the organization as a whole than bringing in a new C-level role. That’s particularly true if you compare it to hiring a chief customer officer from outside, potentially leaving some chafed feelings among current VPs and SVPs. Plus, by going the VP-CRM route, you can help the entire staff become acclimated to the idea of putting customer-centricity in such a prominent position before taking that next step up to the C-suite.
- Authority. As someone reporting directly to the CEO, a chief customer officer should have more authority to execute on ideas than a VP-CRM, who would still have to send requests up the chain. That’s particularly true for any customer initiatives outside the marketing department, such as in merchandising or operations. This assumes two things: That the CEO is fully committed to the CCO role and customer-centricity; and that the VP-CRM is based in marketing.
- Access. Since a VP-CRM is not in the C-suite, lower-level positions have a more direct communication path than if they were reporting up to a CCO. That means that tactical functions and initiatives would be more likely to reach the VP-CRM before they’d make it through the additional layers to reach a CCO. On the flip side, the VP-CRM may not have a direct report line to the CEO, which a CCO would.
- Oversight. Traditionally, a VP-CRM will be positioned within the marketing department. And that can cause overarching customer-centricity initiatives to be seen solely as marking programs. On the other hand, the CCO position isn’t tied to a specific department, but rather has oversight across the board. That’s a definite benefit in terms of elevating CRM and customer-centricity as enterprise-wide endeavors.
CCO and VP-CRM: Similar Job Duties
Most of the differences between the VP-CRM and CCO roles are really highlighted when you review the advantages and challenges of each position. In short, the disparities come down to the amount of disruption to your organization, level of access and authority of the position, and cross-department oversight.
But when you get down to actual responsibilities, the two roles have the same focus. That is, to provide an owner, or advocate, for the customer and the customer experience — ensuring that every organizational action and objective takes the customer into account, front and center.
Specifically, tasks typically include those listed below.
- Customer data analysis. Whether CCO or VP-CRM, this role needs to understand how to use data and analytics to see what’s working well and what’s not in terms of CRM, the customer experience and customer retention. That includes analyzing how offers are performing, how well various initiatives are retaining customers and how KPI metrics translate into ways to improve business. In short, to leverage data to understand what needs to be continued or improved to keep customers loyal to the business.
- Segmentation. A CCO or VP-CRM needs to understand how customer data can be sliced and diced to create logical, effective audience segments. Of course, segments are a valuable marketing tool, helping to ensure a retailer delivers the right message to the right customer at the right time. But that’s only part of the bigger picture. To push true customer-centricity forward, the CCO or VP-CRM needs to carry that segmentation into divisions outside of marketing and make sure those areas understand how to use it for enhancing the customer experience and loyalty.
- Journey mapping. It’s the job of a CCO or VP-CRM to ensure customer journey maps truly tell the story from a customer viewpoint, not a merchant viewpoint. They need to be able to step outside their own perspective or any preconceived notions. And they need to ensure that multiple journeys are mapped, since not every customer has the same experience or follows the same path. This exercise can expose pain points and obstacles for both customers and employees. And remember, if an employee hits a stumbling block, that will more than likely translate to a poor customer experience at some point.
- Unification. A key role for any retail CCO or VP-CRM will be to reach not just “across the aisle,” but across the entire organization, making sure the customer-centricity message is shared, understood and supported by every department. That can be a huge challenge. Many organizations remain highly siloed, with one department for e-commerce, another for brick-and-mortar; with marketing here and data over there — and little communication between them all. Add to that the omnichannel nature of today’s customer experience — an experience that must be seamless — and you can see the importance of having a unified vision and unified approach.
In some organizations, the CCO or VP-CRM will also play a role in customer acquisition. For instance, a retailer with a mature audience — or a mature loyalty program — may rely on this position to help bring younger customers into the customer base and get them engaged with the program.
3 Traits for Success
When searching for someone to fill the chief customer officer or VP-CRM role, there are three key traits that are essential for success, regardless of what else is on the person’s resume:
1. The person must be a team player, able to cooperate with different people, personalities and departments. Working with different teams will be necessary to ensure that the customer is considered in every decision across the organization.
2. The person must be able to think strategically, with experience and proven skills in developing and defining customer strategies.
3. The person must be a storyteller, able to effectively and engagingly communicate the customer perspective and the benefits of customer-centric initiatives to a wide range of people with differing priorities. Being able to weave data into the tale is an essential part of this trait.
Beyond that, for either a CCO or VP-CRM to be successful in their role, they need to have support from the CEO. The CEO has to believe in the vision of a customer-centric enterprise. In addition, the CEO is the only one who can empower the position with the authority to do the job right. It’s also up to the CEO to make sure that the position is clearly defined to the person taking the job — and that the rest of the organization clearly understands how that position fits into the organization as a whole.
What’s right for you?
So which is right for your organization — a chief customer officer or a VP-CRM? You’ll have to consider all the factors above as well as where your company is on its customer-centric journey. For many retailers, it works well to start with a VP-CRM, especially if you can promote from within your organization. This move tends to cause the least disruption and has the added value of bringing all that insider information into the new role. The VP-CRM could then grow into a CCO position as your customer-centric approach matures.
That said, other retailers may be ready now to bring on a CCO rather than gently dipping their toes in the water first. While it may initially cause more organizational disruption, it may also be the route to more quickly ramping up customer-centricity and ensuring it a prominent role ASAP.
Whichever route you go, rest assured that hiring either a CCO or a VP-CRM will push your customer focus forward — and help ensure that customer loyalty (and attendant revenues) are following right along.
In Action: One Retailer’s CCO vs. VP-CRM Debate
One of the nation’s largest specialty retailers asked CCG to assist in re-focusing its enterprise from product-centric to customer-centric. As part of the initial assessment process, CCG noted that there was no owner of the customer experience — a serious handicap in being able to move forward with the company’s customer objectives.
CCG presented the retailer with two scenarios to solve this problem — hiring either a CCO or a VP-CRM. After reviewing the benefits and challenges of each option, the retailer chose to bring a VP-CRM on board, with the position reporting to the SVP-marketing.
While either position would have been new to the company, introducing a VP role presented a lower disruption threshold, since the position aligned easily with current organizational structure. This would help reduce friction in the overall effort to develop an enterprise-wide CRM mind-set. In addition, the retailer knew that the VP-CRM role could grow into a CCO position over time.
To further support the enterprise-wide transformation, CCG recommended that the retailer bring on board several additional positions, including a CRM analyst and CRM coordinator, as well as modifying the customer service manager role to cover both physical-store and online commerce.
The retailer is currently working on filling these new roles. With a high degree of support from their Board, CEO and executive team, we’re confident that they’re poised for success.
Whether you’re deciding if a CCO or VP-CRM is right for you, or you’re ready to kick off a talent search, our CRM agency can help. We can also work with your team to keep your CRM efforts moving forward while you’re looking. We’ve spent 40+ years helping retailers become more customer-centric, with a constant focus on ROI. See how our retail marketing consultants can help you take the next steps.