September 21st, 2010

10 Ways to Make Your Marketing Organization More Strategic and Effective

One of the biggest challenges for marketing professionals is to determine how to balance their time to work on both tactical and strategic marketing activities and actions. Left to natural tendencies, most marketing people and teams will work on short-term activities that help drive the business for the next month or quarter. An old HP colleague of mine calls this the “tyranny of the current.” Most organizations naturally assume that the primary role of marketing is to help sales close short-term and mid-term business. And that certainly is an important part of the marketing function. After all, we are trying to create new products, brand awareness, and demand for something! If it is not for sales – or to generate incremental revenues or market share – then what is it for?

Yet at the same time, when marketing teams focus only on the short term, they miss some of the strategic roles that marketing can and should play within the organization. From experience, I know that tactical, short-term focused marketing teams are not very well-respected. In order to be considered a strategic function (like finance, operations, R&D, etc.), there are other critical roles the marketing function must play. I listed those key areas in the blog entry 6 Key Roles of Highly Successful Marketing Organizations. I won’t repeat them here.

What I would like to do is highlight 10 distinct ways marketing can become more strategic in any organization. They include:

1. Bring more customer insights and the voice of the customer into the organization.
2. Write a strategic marketing plan, budget funds towards it, and execute against it.
3. Focus a few key positions on strategy (long term) and keep those people focused on longer term activities and goals (such as planning, strategic initiatives, etc.) vs. execution (tactical).
4. Separate sales or business development functions from marketing, if they are organizationally together. When marketing is imbedded within the sales department, it makes it particularly difficult to be strategic.
5. Separate marketing operations (the business of marketing and reporting, forecasting, pricing, sales response, etc.) from marketing management. Give it focus within an organization.
6. Set objectives, accountability, and metrics for short and long-term team objectives and hold your people accountable for delivering results for both. After all, what gets measured gets done.
7. Hire the right people for your organization. You need people who have the skills to operate at both a strategic and tactical level.
8. Learn to prioritize and say no. Of course, this is very hard to do. But stick with activities that are aligned with the organization’s objectives, not the “issue du jour” advanced by an aggressive sales manager or the sales response team.
9. Read Marketing Managementby Kotler and Keller. This is a great book to learn about strategic marketing management.
10. Set expectations around long term focus with senior management. With constrained resources, a common feature to most marketing organizations, certain tactical activities will need to be de-prioritized in order to spend time on the longer term, strategic elements of the business plan. These strategic elements should contribute to the company’s longer term revenue and profitable growth.

Effective marketing requires a balance of strategic and tactical work. Too little tactical work and marketing will be seen as working “in the clouds.” Too much tactical work and marketing will not be valued as a strategic function but as a “sales assist” team.

I would be interested in hearing your thoughts on how you have balanced these orientations within your own marketing teams.

Print

Email

Rss

91 Comments

Posted By Vince Ferraro

September 6th, 2010

The Zen of Marketing Management

Courtesy of Filomena Scalise / FreeDigitalPhotos.net

I was thinking about how, as marketers, we are so completely focused on end results, whatever they may be. We are obsessed about new product intro dates, pricing, social media impact, web site hits, sales, profit, market share, and the list goes on. We are whipped into a frenzy around measurement and ROI of our marketing investments.

This in turn reminded me of a Zen story that will shed some light on another important aspect of marketing. It goes something like this:

A student asked a Zen Master,
‘If I work very hard,
how long will it take for me to realize Zen?’
The Master replied,
‘Ten years.’

The student replied,
‘If I work very very hard,
how long will it take for me to realize Zen?’
The Master replied,
‘Twenty years.’

The student replied,
‘If I work very very very hard,
how long will it take for me to realize Zen?’
The Master replied,
‘Thirty years.’

The student replied,
‘But, I don’t understand…
why does it take longer when I work harder?
The Master replied,
‘When you have one eye on the goal, you only have one eye on the path.’

Too often in marketing we are obsessed with the goal, to the point that we fail to understand that the path, or the process, we used to reach the goal is equally, if not sometimes more, important. Oftentimes, marketing professionals fail to invest adequately in infrastructure and business processes that will ultimately help us achieve the expected business results. In marketing, it is often hard to rise above the challenges of the quarter to quarter “what have you done for me lately mentality.” Truth be told, businesses need to ensure that the right processes and tools are in place to reach those treasured results. Having a processes-oriented mentality (following the path if you will) will achieve many important things. First and foremost, it will help you build a better framework for problem solving.

For example, do you want to build a more effective new product launch capability?  In order to do that, you need to map out all of elements of a successful product launch – the timing, actions, owners, and interdependencies. A second important outcome is that a well-defined process should improve overall operating efficiency. Build the process out and you will find what you really need (and don’t need) to run the business efficiently. A well-defined process also optimizes workflow, making the overall decision process more efficient. That could mean reductions in people, time and money. Great BPO projects don’t add resources—they take resources away, because they are more automated, require fewer steps, and so forth. Finally, there is the matter of effectiveness. The path will lead to more effective decisions. The results include (among many other things) better product designs, enhanced time to market for new products, more accurate forecasts and improved pricing. One shortfall of the marketing function is that it is not always favorably viewed as being a tightly-run ship, due to all of the processes, metrics, and control systems such as the supply chain or the financial aspect. Because of this, we get a bad rap; but I think we are getting better and improving over time. Having said this, we still have a long way to go, and a long path to follow!

Therefore, the path to great decisions is as important as the goal. Being more process-oriented will help you keep your eyes on the path. Marketing professionals who focus only the goal will miss the enlightenment that can be found by following the path.

What is your marketing Zen?

Resources:

http://www.amazon.com/Z-B-Business-Administration-Practice-Transform/dp/1577314697

http://www-usr.rider.edu/~suler/zenstory/zenstory.html

Print

Email

Rss

141 Comments

Posted By Vince Ferraro

July 11th, 2010

The CMO Council State of Marketing Report, featuring the 2010 Marketing Outlook Audit, is the largest independent assessment of senior marketing executives today. This annual global benchmarking initiative undertaken by the Chief Marketing Officer (CMO) Council, gains insights into how senior marketing decision makers are managing marketing mix modeling, budget allocations and media mix spend, and investments into infrastructure, technology platforms and enhancements to internal competencies. Given the economic challenges and market pressures worldwide, this year’s review of ‘08 performance and ‘09 challenges and intentions is far deeper and wider than before. The results of this study will be extremely valuable to all participants seeking peer-level input and consensus on critical issues and priorities in the year ahead. 

If you to be up to date on what marketing thought leaders are thinking about and doing in their marketing programs, activities, and spend, this is the report to read. 

There are many excellent conclusions and observations available in this document. Some of the big picture marketing goals and strategies of 2010 according to a survey of senior marketing leaders include:

• Reallocating more money towards electronic media that is engaging and helps drive increases in customer loyalty.
• Undertake very big consumer insights and business intelligence drive as we gear up to invest in emerging markets.
• Shifting marketing dollars to direct sales engagement and sales training.
• Need to work on coordination and time management of integrated marketing campaign teams.
• Be wiser in channeling the right message into the correct channel to maximize effectiveness.
• Improve communication between marketing and non-marketing employees.

 Some additional recommendations by Deloitte and ExactTarget  include:

Improve marketing alignment across the value  chain.

In recent years, a large number of companies have improved their marketing performance by creating greater internal alignment between Sales and Marketing. Now, many are expanding this effort beyond their four walls to include their key value chain partners. For example, companies in the consumer packaged goods and consumer electronics industries are collaborating with retailers to align their marketing programs, investments, and planning. 

Harness the power of social media. 

New digital technologies and social media channels are changing the way customers think and behave. Established companies are naturally reluctant to shift their focus away from traditional marketing channels that have served them well in the past. Also, many companies don’t know how to operate effectively in this new environment, and are afraid of losing control over their marketing messages. Unfortunately, sitting on the sidelines is no longer an option for most. Conversations that have a profound impact on your product and brand are already happening in these new channels. 

Get more value from customer analytics. 

By now, nearly all major companies are likely making a conscious effort to unearth the valuable insights hidden in their customer data. In fact, according to this year’s CMO Survey, 62 percent of respondents plan on “improving customer segmentation and targeting,” making it the number one improvement strategy for 2010. Yet our experience working with companies around the world suggests that most will barely scratch the surface when it comes unleashing the full power of customer analytics.

Embrace customer service. 

The importance of good customer service will continue to increase as consumers feel more and more comfortable airing their grievances online. Consumers don’t want to go to this level. As one consumer told us in a recent focus group, “I’ll call and then email, but if I don’t get the help I’m looking for, look out! They can’t ignore me when I put it on Facebook and Twitter.” Social media levels the playing field. Progressive marketers will embrace this accountability instead of fearing it. 

Scale through automation.

63% of marketing executives are looking to automation to improve efficiency and campaign effectiveness. The two most common marketing automation solutions planned for deployment in 2010 are for email marketing (46%) and social networking (39%). As a provider of automation tools for both of these channels, we have seen how this type of automation can improve response. For example, we have witnessed automated messages triggered to email subscribers based on their online behavior generated as much as 70 times the conversion rate of non-triggered messages.

Measure what matters. 

As marketers look to improve their online marketing capabilities, they must look beyond top-line performance metrics. High-level metrics are still the most commonly used measure of online effectiveness with 63% looking at page views and registrations. Comparatively, only 38% measure online effectiveness via transactions and/or subscriptions and 22% look at deal values and/or selling cycles. 

A summary of the report is available for free here. 

The complete report is available for $199 here.

I would be interested in hearing your feedback about the conclusions and trends to see if your company is experiencing facing similar challenges and opportunities for the marketing function. 

Happy reading!

Print

Email

Rss

98 Comments

Posted By Vince Ferraro

February 24th, 2010

I am late with this blog post, but I wanted to take some time to think about and define essential elements and functions world class marketing organizations exhibit. I may be biased because of the previous positions I have had at HP. But I believe the most successful marketing organizations and leaders create and blend roles that drive the business growth and deliver upon their functional objectives and deliverables. While I assume I will deliver many future posts on the topic of the role of marketing and CMO, let me say the following which may obvious to many.

The more the marketing role is structured around deliverables and tactics, the less value the rest of the company (and the people who manage the budgets) will ascribe to the marketing function. In contrast, the greater the ability of marketing to influence the business – whether that be strategy, value creation, new product development, growth initiatives, etc. the more value and importance a company will derive out of their marketing organizations. In my consulting practice and network, I have met many companies “enlightened” about the value of marketing. They say they want to build a “strategic marketing” organization and invest money, hire talented people, etc. The goal, of course, is admirable. But then ask the tough questions. You find out that marketing doesn’t report to the CEO/President like HR, Finance, Operations, etc. It reports two or three levels down in the organization. Think that is a strategic investment in marketing? Ask another question and they will tell you they don’t know much about marketing – they read that is important (or some consultant or the board told them it was important) and they want to invest, but watch it at a distance. “Prove to me that marketing has strategic value and we will elevate it in the organization”, they pontificate.

The marketing professionals that take on these roles, in many cases, are doomed to failure because their organization is not really ready to engage or support the marketing function at an appropriate level. Finally, some sales-focused organizations and CEO/owner managers are not ready to be “enlightened” by a more capable and powerful marketing organization or leader. They say, “Ignorance is bliss, but knowledge is power”.

What I can say, after observing great and not so great marketing organizations, is I believe there are 6 key roles that most successful marketing organizations (and the people in them) play.  Executing on them greatly improves the chances that world class marketing will be delivered.

• Be the Strategic Visionary for the Business – Shape the future direction of the company and help the company and the board see what the future and success looks like. Be an externally facing PR/Industry Analyst spokesperson about this vision and strategy with the CEO and the other executives.
• Grow Revenues and Share While Effectively Managing Profitability – Be the champion of growth in the company.  Build strategic plans, portfolios, and initiatives that drive growth short term and long term revenue and market share while delivering on the bottom line profit of the company – net profit, operating profit, EBIDA, etc.
• Identify and Create New Business Opportunities – Help the company identify adjacent, new business opportunities that can be grown organically or through acquisition. Assist the company in its make, buy or build decision-making. Finally, lead the organization in the identification of potential partners or acquisition targets
• Bring the Voice of Customer and Insights to CEO and C-Level Staff – Do it in a way they can be internalized and used to create value and competitive advantage for the company. Listen to what customers are saying. Create different ways to interact and capture that feedback (i.e. social media).  Be able to aggregate the data and provide meaningful insights that are actionable.
• Create and Manage the Right Marketing Structures – Ability to successfully brand, create, introduce, manage, and sell a company’s products and services at the appropriate cost and with the right ROI. Not everything in marketing is fun and glamorous. We need to create structures that measure the investment return (ROI) of the money we spend and create structures and processes to get what we need out of the organization to deliver the functional goals. We also need be great in the functional practice of creative and innovative marketing and understand and master relevant, new marketing techniques and practices.
• Proper Marketing Role is a Blend of Activities and Roles Over the Strategic Planning Horizon - Spend too much time in strategic planning, and the company may view marketing as being in an ivory tower. Spend too much time in tactical execution mode and you might not be seen as value-added function, but one that wildly spends money on frivolous activities. It is the classic Prisoner’s Dilemma. While not easy, good marketing organizations are able to balance the two well. One other thing I would mention is that as a marketing functional leader, spending too much time in strategy or execution risks labeling you as too strategic (can’t execute) or not strategic enough. Balance and harmony on this continuum is key.

The important point, in summary, is that marketing is the only function, in the office of the CEO, which can broadly lead an organization down the path of growth and strategic insight. Because of the scope of what marketing people do, this leadership doesn’t come from other functions such as HR, Finance, or Operations.

There is a lot of literature and articles out there about the evolving role of marketing and CMO. Here are a few that I found interesting.

CMO Tenure – Slowing the Revolving Door

The Evolving Role of the CMO

Evolving to a New Dominant Logic for Marketing

Happy reading and please let me know if you have other ideas, comments, or thoughts about key marketing roles.

Print

Email

Rss

6 Comments

Posted By Vince Ferraro