Marketing Governance

Jim Stengel, former Global Marketing Officer for P&G and a MarketShare Advisory Board Member, offers insights on the changing role of the CMO, why tomorrows CMO wont look like todays, and where marketing analytics fit into the evolving picture.

Asia has always been a big driver in innovation and this can lead to challenges in marketing operations and keeping pace. Here Wilson Raj, Global Director Customer Intelligence at SAS talks about what companies are doing to reduce time to market.

Unlike many C-level executives, Chief Marketing Officers (CMOs) are without commonly accepted strategies and routine performance measures. This may be in part why CMOs so often dont get a seat at the executive table and incur such high churn. So whats a CMO to do? In this 

Journey to Marketing Operations Maturity one can read that high-value MO goes beyond automation, measurement and administration to include higher value-add tools such as cross-functional collaboration, change management, metrics alignment, competency development, predictive analytics, and the like.

According to the survey, companies showed clear tendencies to extend the scope of MO. Thus, the scope of MO typically includes fundamental, expanded, and sophisticated elements:

• Fundamental MO Scope — Includes budget management, customer relationship management (CRM), vendor management, marketing outcomes measurement, and marketing services (e.g., bill of materials, licensing, pricing, creative, production management).
• Expanded MO Scope — Expands beyond the Fundamental MO Scope to comprise marketing campaign automation, process mapping and design, best practices and knowledge management, cross-functional and behavior-rewards alignment, marketing operations management (MOM), marketing resource management (MRM), digital asset management (DAM), and marketing process metrics.
• Sophisticated MO Scope — Evolves to higher sophistication than the Expanded MO Scope to include advanced processes (e.g., LEAN Enterprise, Six Sigma, and supply chain management), marketing governance, portfolio management, customer profitability, change management, competency development, shared vision and strategic management, enterprise marketing management, metrics alignment, and predictive analytics.

The graph shows the progression over time from Fundamental to Expanded to Sophisticated practices

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In today’s market marketing teams are under more and more pressure to perform and get results. ROI is a magic word in marketing now-a-days, while budgets and resources are under pressure as well. In the meantime customers are holding back and getting less and less faithfull to just one brand. So, pressure is on for the marketing department, because you can only do so much to get better results.

There are several trends today which cause this higher pressure, says a paper by SAS.

• Consumers are more empowered then ever
• Data volumes are exploding
• New contact channels add complexity and dissonance
• You don’t control all the channels
• There’s more opportunity for confusion and noise
• Marketing organizations are drowning in data

How can marketers keep their head up in all this turmoil? How can they identify the best strategy that will deliver the best returns on from marketing investments?

Wilson Raj, Global Customer Intelligence Director at SAS shed his light on how to improve ROI on your marketing investments during a webinar sponsored by the Direct Marketing Association and SAS.  Optimization is the keyword, he says.

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Marketing has come a long way. People have been selling things and services since early man. But how we market these things has changed a lot through the years and ages.

Modern marketing hasnt been around that long, it started  at the early 20th century, according to Marketo. As we entered the modern industrial age, the amount of goods became greater than the number of available customers, and so did the competition because suddenly had a choice. Modern marketing was born.

In time, with the emergence of new technology, marketing had to adapt. First, radio shook up how companies did their marketing. Then television made a huge impact. Then the Internet revolutionized not only how people did business but also how they live.

To illustrate technological advancements that have changed the course of marketing, The Definitive Guide to Marketing Automation.

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Dr. Robert Shaw is a renowned businesswriter on marketing. He also is a consultant on the field of marketing, particularly Marketing performance measurement and management and Database marketing.

In his work two key elements come forward.

1. Marketing automation: the idea that the marketing function should embrace IT to improve its efficiency and effectiveness. Shaw has tracked the uses and abuses of IT in marketing for over 20 years and defined best practice in this field.
2. Marketing performance measurement and management. Shaw identified the need for marketing to become more measurable and accountable and his researches continue to define best practice in this field.

In this ten minute interview, conducted by Mayer Becker, Shaw sheds his light on Leaner, faster and better marketing.

If you are going to deliver Operational Marketing Excellence in your business you need to get your technology implementation right.

Here are the top 10 critical moves you should make.

Perhaps your marketing organization, like so many we work with have a marketing dashboard. At two recent conferences where the topic was marketing dashboards we asked attendees whether  their dashboard enables them to the following:

1. Inform the leadership team of the contribution and impact marketing is making on acquiring, keeping, and growing the value of customers?
2. Provide a direct link between your marketing programs and investments and business results?
3. Enable you to make strategic decisions?

Most every participant indicated that their dashboard is not addressing these three questions.  If this situation sounds familiar, then it may be time to do some fine tuning.  Below are three attributes we use to evaluate a dashboard’s ability to facilitate decisions, improve marketing, and prove marketing’s contribution.

Alignment

One of the first things we look for when reviewing a dashboard is the degree of connection between marketing activities and investments and business outcomes.  This signals how well marketing is aligned with the business needles the company is trying to move and whether marketing will be able to communicate its impact and contribution.  For example, let’s say one of the metrics on the dashboard is brand awareness.  That might or might not be a good metric.  And even if it is a good metric for the organization, if the relationship between brand awareness and the outcome it is expected to impact is unclear, then the dashboard needs adjustment.   Members of the C-Suite are invest in marketing initiatives that will help the company acquire more of something, faster, less expensively, for example, more customers, more market share, more business with existing customer; faster conversion rates, and faster product adoption.  Does your marketing dashboard show marketing value, contribution and impact on find, keep and grow, and answer the questions of more, faster, and at what cost?

Outcome-based Metrics

The next thing we examine is the metrics themselves.  Most of the time what we see is data around marketing activity and leads.  Rarely are the metrics actionable.  If the metric isn’t helping you make course adjustments or strategic recommendations it might be interesting and you may want to track it, but it probably isn’t one you want to send up the flagpole. Think about the dashboard in your car.  There are just a very few indicators you are monitoring such as level of fuel, engine temperature, air pressure, and speed.   Each of these indicators are tied to some very important outcomes, such as not getting stuck because the tank is dry or the tire is flat or the engine overheated, or not  getting a speeding ticket.  Each of us uses the dashboard in our cars as a way to make decisions to help manage or mitigate risk.  Some of us are willing to push the risk envelope a bit more and keep the pedal to the metal or keep driving even though the gas gauge needle says the car is running on fumes.  But we have the metrics we need to decide whether to stop and fuel up or not.

Performance Targets

Lastly, we look to see whether the dashboard compares targets to actual.  Many dashboards are missing this critical element.  Monitoring, measuring, and reporting results need to be within the context of the target and the commitment made.  There are two parts to this dimension:

1. Performance Context:  If you report that you ran a 5K race at a 10 minute per mile pace how can we determine whether that was success or failure?  If you typically run at an 8 minute per mile pace for a 5K then this information tells us something was off and we can begin to do a diagnostic – were you sick, did you lack fuel, were you over-trained, did you have a cramp, fall down?  But if you typically run at a 12 minute per mile pace, then this is a huge improvement.  We have performance context for your results.
2. Performance Commitment.  What performance commitment did you make?  Was your commitment to place in the top five in your age group? Or was it to surpass your personal record? Or, something else?  The point is that your dashboard should enable you and anyone who to evaluate the results within the performance context and commitment.

Summary

If you have a dashboard that makes the connection between marketing activities, investment and results, is comprised of metrics that foster decision and action, and reports performance within context and commitment you are on your way to having a dashboard that will enable you to improve and prove the value of marketing.

Operational Marketing Excellence doesn’t come easily; it takes time and demands that you change stubborn habits, overcome emotional barriers, and mend broken processes. Software-vendor Aprimo has some top tips.