Archive for the ‘Business management’ Category

Today’s Rant: Why Marketing is Harder — and More Fun

A salesperson who is face-to-face with a prospect can vary his or her dialogue to accommodate the prospect’s needs and interests.  The salesperson knows the company size, location and industry as well as the prospect’s role and stage in the buying cycle.  She can assess the prospect’s level of knowledge and fill in gaps.  Most importantly she can use the prospect’s responses to guide the discussion.

Today the salesperson doesn’t get a face-to-face meeting until much later in the buying cycle.  It is the marketer who must keep the attention of the multiple buyers at a multiple companies through the early and middle stages of their buying cycles.  In order to keep each buyer’s attention, the marketer’s provision of information  must vary in the same way a salesperson’s approach varies.

Yet the marketer isn’t sitting across from a single prospect.  He is tracking and analyzing demographic and behavioral information about prospects, developing hypotheses about intent, gleaning insight from current customers, and mapping responses to prospect behaviors to move them to the next stage in the buying cycle.

Today’s marketers need to:

  • Sharpen core marketing skills, including:  knowing customers and prospects, understanding the processes that are affected by a product or service, mapping the buying cycle and buyer information needs, clarifying differentiation, and developing evidence-based value propositions.
  • Get comfortable experimenting, acting on partial information, and adjusting course as they find new information.
  • Put repeatable processes in place to leverage knowledge gained.
  • Select and properly use appropriate technology.
  • Collaborate fully with sales and lead the company into social business where “everyone is a marketer”
  • Draw insight from customer interviews, analyze data, demonstrate accountability…

…the list goes on. Yes, businesses hold marketers, and marketers hold themselves, to a higher standard today. Leadership matters. Strategy and management matter. Evidence tells the story.

It’s a lot more and a lot more fun.

Number One in Social Business

At Enterprise 2.0 this week in Boston, I found a few inspiring moments amid all the activity.  I particularly liked the opening keynote presentations by John Hagel from Deloitte on the first day and Lee Bryant of Headshift on the second day.  The big takeaway…my number one in social business:  it all starts with a problem that needs to be solved…and that you can affect.

Hagel described a simple metrics-based path to finding the right problem to address.  Start with business metrics (e.g., where are you spending the most money or where are costs growing faster than revenues).  Dig into the causal operational metrics (e.g., buses are breaking down and taking a long time to get back into service).  Then dig deeper into the processes that are leading to the operational problems (e.g., finding the right parts).  The discrete problem of speeding information sharing about availability and need for parts is the level where social business can have an impact.  Businesses don’t “become social.” Discrete problems get solved through new processes enabled by social technologies.

Bryant’s focus was on finding the things you can change–drawing actionable insight from the data and activity streams enabled by web 2.o and enterprise 2.0.  He pointed out that insights need to be shared widely so that the right person — the one who can take action — sees the information in a close to real-time process he described as discover, filter, action and evaluate.

Tony Martins, VP Supply Chain at TEVA Pharmaceuticals, added another layer to the role of social business in solving business problems, referencing spontaneous association to form ad hoc networks for solving problems.  By combining skills to solve a problem rather than escalating and following an agreed-upon procedure, his teams were reducing manufacturing cycle time by 40%.  And managers, who had been spending half their time handling surprises, gained valuable work time.

Debra Devoy, from OpenText, added her company’s findings:  that “strength of purpose” is the one factor that enables OpenText to predict the success or failure of an implementation.

Sure, it’s management 101:  start with your objectives.  Why don’t we do it more often?


New Research on Why CRM Fails…Also Lessons for Marketing Automation

MIT Sloan Management Review (Spring 2011) published new research on CRM in an article titled, “Why CRM Fails and How to Fix It.”  This is fantastic reading; truly an energizing piece pointing to down-to-earth advice.  The four key insights that the authors drew from their research are equally applicable to marketing automation.  They are (verbatim):

  1. “If the appropriate marketing capabilities are not developed, little or no return will be generated from investments made in CRM.”
  2. “The rate of organizational learning, rather than the size of the company’s CRM budget, determines how rapidly companies can change the way they relate to a consumer, which, in turn, is linked to the length of the consumer purchasing cycle.”
  3. “Top management can provide the money, software and authority to create a CRM program, but such investment must be informed by cycles of learning from consumer insight….an organizational culture that tolerates experimentation will be more successful at building new CRM capabilities.”
  4. “Hard work and commitment are what it takes to develop marketing capabilities…far from being a black box (marketing capabilities) can be developed through conscious, goal-directed learning by those responsible for CRM.”

While some scoff at my contention that today’s marketing is harder than ever before, these insights from the research support that view. Enough of the left brain/right brain argument.  Enough of the data/experience fuss.  Enough of the processs/technology discussion.  It takes them all…along with leadership and courage.  I’ll say that again:  leadership and courage.

Back to the article.  The authors display a matrix with four marketing activities (demand management, creating marketing knowledge, building brands, customer relationship management) on the left and three marketing relationships across the top.  The marketing relationships between companies and consumers are:  transactional (from the 1970’s), one-to-one (based on the long-term relationship focus of the 1980s ) and networked (flowing from online networks, the company supply chain and consumers).”

The latter (networked relationships) is characterized by “co-creating value with a network of consumers,” marketing knowledge coming from “key network participants and shapers,” consumers encouraged to “access a networks capabilities,” and consumer self service.  How different is this from where your marketing is today?  How does this vision apply to your marketing? How will you go about building the capabilities to succeed in this networked relationship between company and consumer?

Don’t be stuck in in the 1990s.  Please read the article and let me know whether it made you want to cheer also…

(Back to marketing automation:  Today’s ClickZ piece on Marketing Automation…Far from Automatic opened once again the discussion of why so many marketing automation implementations fail to deliver expected results.  It makes good points but doesn’t go far enough into a meaty topic that I’ve covered frequently.

Who cares about marketing data?

In a recent survey conducted by Patricia Seybold Group and the Information Technology Services Marketing Association (Survey on Data-Driven Marketing, March 2011), more than 100 marketers reported what types of marketing data most interested heads of other departments.  Customer data was the hands down winner, recognized as the top choice by CEOs, COOs, Business Unit Leaders, and Service Delivery Leaders.  The findings (see below), while not statistically significant, do raise some questions worth pondering.

Type of Data Top Choice For:
Customer Data CEO, COO, BU leader, Service leader
Sales Accepted Lead Data Sales leader
Markets Data CTO (2nd choice for CEO)
Marketing Programs Data CFO
Competitor Data None (2nd choice for Sales, Service, CTO)
Contacts Nurtured by Marketing None (4th choice for Sales)

Consider first, the kinds of data needed to understand sources of future growth (markets, competitors, customers) and the kinds of data needed to understand short term opportunities (customers, competition).  Then consider what is needed to forecast short term success (sales accepted leads, contacts nurtured by marketing).  Finally, what is needed to allocate budget dollars (marketing programs data).

It occurs to me that marketing has started its measurement activities in the area of least value to the company (marketing programs data).  It is, fortunately, moving higher in the food chain to using contacts nurtured by marketing to forecast revenue.  But still that is mechanics — can’t be ignored but not the source of the real value to the company.  It is time for marketing to set its sights on growth and provide credible information to the rest of the organization on customers, markets, and competition.

Approach this like any other project — understanding what other departments are trying to accomplish and then providing information that helps them do that better, faster, more easily, more expertly.  Providing credible marketing data to the rest of the company requires organizational outreach — crossing departmental lines, understanding needs, communicating effectively, and building relationships that foster mutual achievement.

That said, it is not all about the rest of the organization using the data…it is also about marketing’s uses of data to find new opportunities and capitalize on known opportunities.  Be just as disciplined about the needs analysis for the marketing department.  Afterall, you are/should be leading the charge.

Three Ways Data-Driven Marketing Improves Performance

Data-driven marketing and sales performanceAccording to a survey just completed by ITSMA and Patricia Seybold Group, today’s B2B marketers recognize the importance of data-driven marketing.  So what?  Well, now we have statistically significant findings supporting that view. 

Data savvy organizations outstripped the others in “significantly or somewhat” improving their market share, average time to revenue, and sales costs per order dollar over the last two years.  That’s hard data that associates leadership in data-driven marketing with market and sales performance increases.  While we found no such relationship to revenue or profitability, that may come in time as marketing data gets more widely used in organizations.

There is a thoughtful post by Neil Mason republished in ClickZ this week on this subject.  His title: The price of light is less than the cost of darkness.  The cost of darkness (i.e., not knowing information gleaned from the data) is getting higher.  As more companies invest in the technologies, processes, and leadership needed to excel at data-driven marketing, the harder it will be to compete if you haven’t adopted new practices. 

The ways that marketing organizations get data savvy, is the topic of an upcoming webcast by ITSMA and Patricia Seybold Group.  It answers the question, “what does it take to become a data savvy marketing organization?” and addresses survey findings on technology, processes, organization, and more.  Mark your calendar for May 17, 2011 at 11 a.m.  Complimentary for ITSMA members. Register here.

If you want to learn more about the results and can’t make the webcast, send me an email.

5 Reasons for Low Adoption of Marketing Technology and How to Move Forward

Many of the technologies that comprise the marketing technology ecosystem have been around since before the shift to customer control of the buying process, a shift that has made technology essential to marketers.  Hence, low adoption rates of marketing technologies can’t be explained by lack of availability of appropriate solutions.  Progress has been slow for five major reasons:

  • An evolving marketing technology ecosystem, in which capabilities of dissimilar elements often overlap.
  • The time required to develop a culture of experimentation.
  • The gaps in process knowledge and skills needed to both chart the path and execute the tactics of this new marketing.
  • All the usual budget constraints, organizational silos, and accountability questions that have plagued marketing for years.
  • Lack of, or delayed, IT support.

Moving forward in this mostly uncharted territory requires important business skills: the leadership to work effectively across functions in the organization, the knowledge to plan a technology strategy, the judgment to reengineer processes and train/recruit the right team, the focus to engineer activities to support business objectives, and the analytical skill to keep finding ways to improve outcomes.

Marketing has, in many companies, fallen into an almost Rodney Dangerfield position in the executive suite: they don’t get respect—and perhaps they haven’t been earning it. Start today to make marketing a legitimate business function in your company.

Evidence: the heart of your business (and marketing) plan

Cover of "Getting to Plan B: Breaking Thr...

Cover via Amazon

If you haven’t read John Mullins’ and Randy Komisar’s book, Getting to Plan B, I urge you to do so.  Their research shows that businesses that try to execute their business plans flawlessly usually fail.  Most successful businesses did not start out intending to be in the business that succeeded for them. ( Read the book for some great examples.)

Instead of doing a business plan, they pose a five-step recipe for launching a business that will succeed (i.e., finding the successful business that you didn’t plan to go into). 

Step 1:  Look for analogs, or evidence that your business idea has legs.  For instance, the incredible success of the Sony Walkman was an analog for the iPod. 

Step 2:  Look for antilogs, or evidence that your business idea may not work.  For instance, why would people pay for music when they were used to downloading for free on Napster?  Conclusion:  Apple would have to make its money on the device.

Step 3:  Identify leaps of faith, or those assumptions you are making that are critical to success but for which no evidence exists.

Step 4:  Develop hypotheses to test each leap of faith and go into the market and start testing.  This is a key part…don’t wait to get into the marketplace.  Get in there and learn and then adapt based on what the evidence tells you.

Step 5:  Use feedback from testing your hypotheses as your dashboard for managing the business.  This is brilliant:  success is about adapting to evidence that your leaps of faith are wrong (if the are) and doing it quickly enough to be able to test alternatives (i.e., getting to plan B).  No sense watching traditional business metrics if the business’ success depends on those leaps of faith.

Marketers need to start operating in this same way.  What are your leaps of faith and how can you test them?