* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Download marketing performance management
Consumer behaviour wikipedia , lookup
Brand equity wikipedia , lookup
Customer relationship management wikipedia , lookup
Market segmentation wikipedia , lookup
Internal communications wikipedia , lookup
Social media marketing wikipedia , lookup
Product planning wikipedia , lookup
Bayesian inference in marketing wikipedia , lookup
Food marketing wikipedia , lookup
Neuromarketing wikipedia , lookup
Target audience wikipedia , lookup
Affiliate marketing wikipedia , lookup
Marketing communications wikipedia , lookup
Marketing channel wikipedia , lookup
Sales process engineering wikipedia , lookup
Sports marketing wikipedia , lookup
Marketing research wikipedia , lookup
Digital marketing wikipedia , lookup
Target market wikipedia , lookup
Ambush marketing wikipedia , lookup
Youth marketing wikipedia , lookup
Guerrilla marketing wikipedia , lookup
Marketing strategy wikipedia , lookup
Integrated marketing communications wikipedia , lookup
Multi-level marketing wikipedia , lookup
Viral marketing wikipedia , lookup
Sensory branding wikipedia , lookup
Advertising campaign wikipedia , lookup
Direct marketing wikipedia , lookup
Multicultural marketing wikipedia , lookup
Marketing plan wikipedia , lookup
Green marketing wikipedia , lookup
Global marketing wikipedia , lookup
Improving marketing efficiency and effectiveness MARKETING PERFORMANCE MANAGEMENT [MPM] Copyright © Musqot Marketing Technology 1st edition, 2016 INDEX Introduction to Marketing Performance Management (MPM)....................6 MPM whitepapers.....................................................................14 The new world of B2B sales & marketing......................... 16 #1. Executive Summary................................................................16 #2. Background................................................................................18 #3. Purchase process – not sales process...........................20 #4. The new role of marketing..................................................23 #5. Conclusion................................................................................. 27 The ”I” in ROI for marketing.................................................. 29 #1. Introduction...............................................................................29 #2. ROI – what is it?.......................................................................30 #3. Focus on the ”I” in ROI..........................................................32 #4. New trends – new KPI’s.......................................................33 #5. Lean marketing........................................................................34 #6. Doing the right things............................................................35 #7. Agile transformation..............................................................36 #8. Fail fast........................................................................................38 #9. Marketing and sales are merging....................................38 #10. Summary and conclusion....................................................39 Views and reflections on the MPM domain......................42 #1. A fresh look at MPM..............................................................44 #2. A discussion about marketing investments................. 47 #3. The 6 A’s of successful MPM.............................................50 #4. MPM in an Agile World.........................................................52 #5. Financials for marketing.......................................................54 #6. Improving Marketing ROI.....................................................59 #7. MPM Procurement advice...................................................62 #8. Impressing the executive team?.......................................63 #9. Marketing efforts, efficient and effective!.....................64 #10. Marketing in the new service economy........................68 #11. Data driven marketing and the streetlight effect.......70 #12. A marketing story from a small town in Sweden......... 71 #13. 5 trends that will re-define B2B marketing.....................74 #14. Premium pricing – the core of brand marketing!........ 76 #15. Innovation & Marketing To Be Successful?................... 77 #16. What to measure – and why?.............................................78 Musqot from a customer perspective............................... 80 A selection of some 5-star customer reviews.......................82 INTRODUCTION TO MARKETING PERFORMANCE MANAGEMENT (MPM) 6 Marketing Performance Management Marketing performance management (MPM) is the analysis and improvement of the efficiency and effectiveness of marketing. This is accomplished by focus on the alignment of marketing activities, strategies, and metrics with business goals. It involves measuring, managing, and analyzing marketing performance to maximize effectiveness and optimize the return of investment (ROI) of marketing. To effectively apply a Marketing Performance Management approach, organizations need some sort of IT solution to support them. Data and analytics The collection and analysis of relevant data is a crucial part of Marketing Performance Management. By thoroughly analyzing the data, organizations can gather actionable business insights to improve the marketing effectiveness and marketing efficiency. Companies can, for example, optimize marketing spending by measuring the impact of marketing activities on sales of a product. For such measurements, data is used to create a model that establishes the link between marketing spend, in specific channels and geographies for example, and incremental sales. IT-systems that support Marketing Performance Management often offer various dashboards that graphically illustrate correlation between data, in order to simplify the analytics process. 8 Metrics Measurement and metrics enable marketing professionals to justify budgets based on returns and to drive organizational growth and innovation. As a result, marketers use these metrics to prove value and demonstrate the contribution of marketing to the organization. Popular metrics used in analysis include activity-based metrics that involves numerical counting and reporting. For example, tracking downloads, Web site visitors, attendees at various events are types of activity-based metrics. Linking marketing to business outcomes, such as sales figures and market share growth, is in some ways even more important, even if sometimes more difficult as well. While metrics data can be manually populated in a Marketing Performance Management system, any efficient management of larger volumes of information typically requires the Marketing Performance Management system to be integrated with external data sources. Examples of such data sources are Social media platforms, CRMsystems and ERP-systems. Benefits for the organization Proof marketing ROI Create, collect and generate data that can help you determine the business effects of your marketing activities. Optimize marketing performance Gain insights to what needs to be done in order to improve marketing efficiencies and effects, in order to optimize your overall marketing performance. 9 Bridge the gap between sales and marketing Clarify the cause-and-effect link between marketing and sales. Strategic alignment of marketing objectives Enable a framework that helps steering marketing activities towards prioritized areas. Make sure that no marketing resources are spent on activities that are not aligned with your overall guiding objectives. Replace the spreadsheets Spreadsheets are flexible and easy to work with, if you work alone. But to make sure that everyone has access to the same information at all times, also when working in larger groups, you need an application that replaces the need for individual documents and uncontrolled e-mail dialogues. Save reporting time Time spent on marketing reporting is often mentioned as one of the most burdening parts of the work in a marketing organization. Enable huge savings by automating the reporting process, and get better reports as well. Collaborate more efficiently Following predefined workflows, and leveraging common tools, will make the collaboration much more efficient. Enable organizational learning Without the systemized use of marketing technology to monitor and support planning processes, organizations are 10 bound to inventing the wheel again and again as people shift positions and responsibilities. Procurement advice Subscribed cloud service The most scalable and cost efficient option is to select a true cloud application, which you can use as a subscribed service. These services are often sold on a user account basis, making it easy for your organization to start with a small pilot group and then gradually expand until all your marketers, and other internal/external stakeholders, are using the service. Proven platform technology Stay clear of proprietary platforms! Choosing an application with unique and exclusive features is fine, after all you will benefit immensely from an application with dashboards, workflows, tabs and graphic interfaces that are customized specifically for marketing user scenarios. However the underlying platform technology should be as standardized as possible. 11 Applications built on custom technology all the way through, even in the infrastructure and platform layers, will grow old quickly – and it will then be costly for the application provider, and their clients, to upgrade and maintain stability and performance. Usability is king It doesn’t matter how advanced and extensive functionality a certain application is equipped with - it will not fly unless users can manage to understand and appreciate it. So don’t make the mistake to pick whatever application has the most “checks” in the requirement specification, because chances are that many of those features might not be within practical reach for your organization’s users anyway. Needless to say, advanced functionality and usability does not necessarily have to compete with each other. Try to find a good match, just remember which one is most important to determine the success of your implementation in the end. 12 13 MPM WHITEPAPERS 14 The new world of B2B sales & marketing #1. Executive Summary The consumer market has changed dramatically over the last 10-15 years. Now we, as consumers, can check the best prices, the quality of products, services and suppliers on the go. Before the internet era, we had little knowledge if a price at a store was high or low and it was difficult to learn from the experience from other users. The market for used cars is a good example of this transformation. Now we can easily check the relevant price for a specific model and year, we can find the full history of the specific car that we are interested in, service history, ownership etc. We can also look for model specific issues, we can find recommendations from other owners of this model. On top of this, we can easily find references on the car dealer and learn if this dealer is ok or not. From a technology perspective this is of course a result of the internet, social medias, chat forums and all the other applications and sites that we are using. But perhaps more interesting than technology is the shift in balance of information and knowledge that this development has enabled. The ”pre-internet” days were characterized by asymmetric knowledge. The car dealer had all the information and the potential buyer had none or at least very little knowledge. At the end of the day, the power balance between sellers and buyers has changed to the advantage of the buyers. These theories are not new. They were awarded the Nobel prize in economy back in 2001 and now we see the full impact of them. The new world of information technology 16 has provided us with the tools to go from theory to reality. For B2C marketing this new world has changed the business models and entire markets. The increased knowledge for the customers means a new balance between sellers and buyers. The sellers that are acting according to the situation and leveraging this new power balance are doing great, but the ones who are reluctant to change their business models are struggling. We now see the same thing happening in B2B. The buyers are taking full ownership of the purchasing process, from identifying a need to implementing a solution. The sellers are in the back seat and the traditional sales process, the classic sales funnel, is becoming obsolete. The buyers are identifying a problem, finding the relevant suppliers, learning about the strengths and weaknesses in the different offerings, checking with analysts and finally contacting the sales teams to negotiate the price. During the process, the buyer has also been in contact with his colleagues in other companies, whom are connected through LinkedIn or other social medias. When the seller finally meets the buyer, the buyer knows the products, the market, the competition and has probably also discussed with the users of all the tools. These has traditionally been the strategic steps in a sales process. Since the buyers now act more independent, the sellers has to adjust. The adjustment involves strengthening the role for marketing and reducing and changing the investments in traditional sales. B2B marketing has to learn from the new world of B2C marketing. It is not only about setting up trade shows, seminars and web-casts - but a structural change into 17 a data driven, multi channel approach to support the prospects’ buying process and to deliver business value. #2. Background The DNA in B2B sales processes has been the same for 30 years. Although the names of the concepts has changed over time, the DNA has been the same. Since I started B2B sales in 1980’s there has been several different sales schools, Spin Selling, Power Base selling, Consultative Selling and Solution Selling, just to name a few of them. However, the underlying assumptions, are all the same. In these old school sales schools, the process was very straightforward. Our successful seller made a cold call to a ”CxO” and booked a meeting. During the meeting the seller would use smart questioning techniques to reveal a hidden need, a problem that the prospect was not really aware of - but that he still suffered from. Our seller then presented a solution to the problem and also presented a reference and ROI projections. Now the prospect was sufficiently impressed to initiate a purchasing project to solve this problem that he or she was not really aware of before the meeting. This process was based on asymmetric knowledge, the seller would have deeper knowledge on the specific discipline than the buyer. This way of working has also been driving the reluctancy to reply to Request for Proposals, RFP or similar activities from the prospect. The assumption is that no company is doing anything by themselves, but always driven by a supplier selling to them. So if you are not aware of an RFP coming, then your competitor has been there before 18 19 you and tweaked it to their advantage. The word ”column fodder” describes this. The underlying assumption in this play is that the seller had better information than the prospect, in regards to the problem and the pains. The seller could use this advantage to reveal hidden needs at the prospect. It also assumes a centralized process, that the CxO wants to start the process to implement a new solution. Since a couple of years back, these two assumptions are no longer relevant. It is also worth mentioning, that in the old school B2B organizations, the sales teams were the heroes. The role of the marketing teams was more to fix balloons, brochures and events. The closest they got to the sales process was to send a list of names on potential CxO’s for the sellers to call. And of course to arrange the yearly sales kick-offs to celebrate the sellers. We also see that the prices in general are being pushed down, regardless of the market. New technologies, new competitors and lower entry costs are keeping a constant press down to prices. With lower margins, fewer companies can afford an expensive traditional sales organization. The sales process is becoming more and more automated. Sales automation drives the need for marketing transformation. #3. Purchase process – not sales process It is time to turn things on their heads - it is no longer a ”sales process” but a ”purchasing process”. The buyers are more empowered, they are making smarter and more informed decisions. Just as the example with the buyers of used cars, who now has an equally good knowledge about the car market, the buying organizations has a similar increased knowledge. 20 Both of their own business issues as well as on all the different solutions. They also have a wide network to learn from other companies with similar demands, they have regular meetings with their peers in other organizations. With this new knowledge, they are initiating purchases and driving the purchasing process much further than they used to. Actually, there are some recent studies that shows that up to 60% of companies are driving their purchasing processes, without seeing a seller, up to when the need of a quotation arises. So you can say that the initial and strategic parts of the sales process has been outsourced to the buyer. In the old days, many organizations relied on sales people to get input on new ideas and new ways of doing business and solving problems. Today, the customers are doing this all by themselves. They know more about their situation and their potential areas of improvements. They also compile all the information they need about the different solutions - and there are several ways of doing this. They can of course just search the web for product information, they also use all the analysts who have compiled information and finally the have a good collaboration with peers at other companies. They meet in formal events and collaboration teams as well as in informal groups on LinkedIn and other medias. These fundamental differences, where the prospects has much more information about both the markets, suppliers and products, are changing the behaviors of the buyers. They are now by far more proactive than the sellers, and they are driving their own agenda. And when finally the sellers enter the stage, the prospects knows everything about the product, the market, the supplier and also about 21 22 the competition. The good old days, when the seller could drive the agenda is now history. The organizations of today are also becoming more decentralized in the way they initiate the buying of new solutions. The decision to initiate a purchase is taken far out in the organization, and even far away from the HQ in a global company. This means that the old school seller must work his way around the different parts of the organization in different geographies to find the person who owns the problem that his product can to solve. Once again, the old school sales model will show that it comes in to late, when the first decisions and scooping are already done. #4. The new role of marketing From sales enabler to driving business value Marketing is in the middle of a perfect storm! The sales and purchasing processes gives new dimensions and new expectations. A general price erosion puts pressure to reduce the cost of sales and to becoming more efficient, to provide more with less. And new technologies are enabling the marketing teams to work fundamentally different. Since the sales teams are now meeting the prospects later in the process, where they have already acquired all the information they need, the selling company must ensure that they can provide the right information to the buyers, at the right time and place. The selling company must also position themselves towards the client needs and the competition, without actually meeting the prospects face to face. 23 From a sales process perspective, this will require a new mindset and a new approach on how to drive a successful sales team, both for the incumbent customers as well as for new. However, the details of a new sales process is outside the scope of this paper. From a marketing perspective their role will be an integrated part of the sales strategy. The sales process will rely on that they buyers can find the right information about your solutions, at the time when they need it. The information must be easy to digest, correct and also show your solution in the right contexts. But this is not enough - Sales & Marketing will have to work closer together. Previously, lead generation was about finding a relevant name so that the seller could call and start the sales process from zero. As we see, this is not the case today. Since the prospects are driving their own agenda, marketing needs to participate further in the prospects purchase project. And they need to collaborate with the sales teams, both from a process and from a tools perspective. CRM tools are no longer only for the sales teams but also for the marketing teams. And the marketing planning tools must be aligned with the CRM tools and used by the sales teams. Just as the sales process is fundamentally transforming, the ways of working with marketing is also going through a change. There are some commonalities within the successful B2C marketing organizations. They are all focused on results and analysis, they all have a data-driven approach to marketing. Continuous analysis of their marketing projects 24 and campaigns are key requirements. How many hits on your website, how many likes on Facebook and how many replies on your mail campaign – all this data has to be captured and connected to the right campaign at the right time. It is not sufficient to wait until you have access the sales figures in the finance system. Since the sales process in B2B tend to be long, you must capture the relevant data as soon as you can. When you launch a campaign, just to capture the hits on the website could be ok for day one. However, later in the process you will of course need to combine this with other KPI’ s and finally to see the actual sales. A key aspect of the marketing team deliverables, is how well they can capture and distribute new leads from the market. Leads means more than a name of a decision maker, it is rather the name of someone who has been actively looking for information, downloading white papers or initiated a trial. These are the leads that actively are looking for information and many of them are planning for a purchase. This highlights the need for a seamless integration between marketing and sales. So that the marketing teams can deliver the names of active prospects directly to the sales teams. In the best of worlds, marketing and sales are integrated and use the same tools. And since the buyers are more proactive, the leads coming from activities on the website or as responses from marketing campaigns are more valid than the old talk of ”column fodder”. Another aspect of the new role of marketing is to create business value. And it is equally important to measure the business value of marketing activities. To enable this, the 25 marketing activities must be linked to the outcome. So that we know that a specific activity has created a well defined value to the organization. The value can be customer activities, like downloading white papers, replying to e-mails or just a ”like” on Facebook. But the value can also be sales related, new prospects, new customer meetings, how many proposals and finally the revenue. During that period, it is important to track all the other activities that marketing projects will lead to. This is especially important since we want to be able to fine tune the campaigns. And we can not do any tuning if we don’t have any data points. Without these data points, early in the campaigns, marketing will be driving in the dark. Unless the marketing teams are data driven, there is no chance for them to become quick, agile and to continuously adjust the marketing activities to meet the desired outcome and the objectives. 26 #5. Conclusion Since the buying part of B2B process is changing very fast, we are now experiencing a direct impact on the sales process. Sellers are involved later in the process and the initial parts of the process is started by the buyer and out in the organization. The impact is that the traditional sales models are becoming outdated. This will take some time, it will differ between companies and markets. But in general, the old school B2B sales is becoming obsolete. To mitigate the risk of becoming irrelevant, there is a need to transform the entire sales process, from identifying a customer need to closing a deal. One key in this is to strengthen the marketing teams in B2B companies. Not by doing more of the same, there is no need for more events, brochures and balloons. But the marketing efforts must be more focused on results, working with the new media landscape and providing the buyers with all the information and knowledge they may need. On top of this, they also need to have a very close collaboration with the sales teams. We want to see an integrated process between marketing and sales. We also see a new role for marketing, from being sales supporting to delivering its’ own business value. To drive business value, the value needs to be well defined and measured. We want the new marketing teams to be able to continuously adapt the activities to the market responses, to be quick, agile and very focused on the strategic objectives. Any deviations should be addressed as soon as there is data showing the deviations. This is an exciting time to be in marketing! There are so many opportunities to transform the business, to increase 27 the status of marketing and to increase the business value of our efforts. There are also new demands on marketing, coming from all these strategic changes - and also from different parts of the organization. Sales teams, management teams and even finance will put new demands on marketing. These new demands are both driven and enabled by new technologies and concepts focused on the needs of marketing. Many of these new tools are focused on automation, to automate tasks that used to be done manually and others are focused on analytics. Statistic analysis on all the data that we can find. These two examples of disciplines are very important. But they don’t really support the integration between marketing activities and the outcome. This is where Musqot’s solution for Marketing Performance Management fits in, to be the interface between marketing actives and their outcome and provide the marketing organization with a tool to clearly show the business value that they provide. 28 The ”I” in ROI for marketing #1. Introduction We are all looking for the ”holy grail” of marketing, where we know how to spend the marketing budget to optimize the business outcome. If we look back in the history, the classic question has been - How many viewers did we reach with a billboard, a newspaper ad or a TV spot? However, a ”viewer” has never been the same as a ”buyer”. To watch the TV-spot will not necessarily drive a sale. So the follow up questions has been to understand how to convert ”viewers” to ”buyers”. Given the digital channels we now have an abundance of data to analyze and to better understand customer behavior and the relations between clicks and buys. This is fantastic, especially for B2C businesses, so many new opportunities to leapfrog the competition just by learning more about customer behaviors and the returns of marketing investments. The Investment side of ROI has never been as cool and exciting, although it is as important for the outcome and critical to actually deliver a strong outcome.There is a simple reason for this: the internal efficiency will drive the marketing effectiveness. The smarter you work and the more streamlined you are, the more time you can spend on doing great marketing, instead of sitting in endless meetings and tracking all endless lists of e-mails. There is also another simple reason, marketing is becoming much more complex. On one hand we have the traditional channels, with their heartbeat and rhythm. Social media will have another flow and there will be automated processes for e-mails, with yet another tempo. On top of the content 29 that is continuously produced there are also specific campaigns, for example new product releases.With all these different workflows, campaigns, projects and activities it is becoming increasingly important to manage and to streamline the processes and the ways of working. Only then can we focus on making great marketing, instead of getting stuck in a daily chaos. #2. ROI – what is it? The financial term ROI, Return on Investment, is a very simple equation that shows the payback on investments. How much money you will get in return for your investment. For marketing this has been a challenging metric, since both the return and the investments has been intangible and difficult measure. On the other hand, everybody realizes that it is a very important metric to follow up. ROI can be either a very detailed number or more of a concept. The strictly financial investments can easily be measured and compared, but the result in terms of business outcome for each marketing activity and combinations of marketing activities are more challenging. But there are other metrics, besides the actual monetary outcome, that are relevant. For example, you can measure the number of new leads or the pipeline value to compare the marketing cost per lead or marketing cost per pipeline dollar. This will enable you to compare different channels or messages as well as to follow up the long term trend. In a faster paced B2C business we can trace the actual sale and compare it to the marketing activities. Once again, we see that social media is an important outlier. What is the value of a Facebook post or a like at LinkedIn? Metrics like these are probably more relevant in 30 terms of building brand value and they should be measured accordingly. ROI is not a matter of mathematics, the number crunching is trivial. The challenge is to understand the relations and correlations, especially on the result side. Lets say that there is a 9-months sales cycle and during that time different individuals in the customer organization has attended events, a couple of webinars, downloaded white papers and read blogposts. Trying to guess exactly which one of these marketing activities that had an impact on the sale is impossible. For sure, all these activities has been a part of the success, they are all important parts of the sale. But it is not realistic trying to estimate the value of each activity. The trends however, are more important. The continuous improvements are by far more important than an exact number at a point in time. By following the trends it is feasible to understand the impact of different types of activities and combinations of activities. For those of us that are accounting purists, we can argue whether marketing really is ”investment” since it doesn’t show up in the balance sheet, like machines or real estate. On the other hand any investment in marketing will affect brand value one way or the other. Either way, let’s use the term marketing investments despite any potential comments from the accounting purists. #3. Focus on the ”I” in ROI Let’s move our focus to the investment side of ROI, the ”I”. Although the objective is to become more streamlined and more efficient, the purpose is not only to simply reduce the cost and to save money. We don’t want to go to the CEO/ CFO and proudly state that we have increased the ROI 31 with 5% if the result will be to have the marketing budget reduced by the same number. That is not the objective. Instead we want to focus on how the streamlining and the efficiency focus will improve the business outcome. At the end of the day, that is what matters. At Musqot, we see many marketing teams that are still using traditional ways of working, although the world is changing dramatically. It is a huge challenge to work with old processes in a new environment. It is also a challenge to drive a marketing team, to manage all the activities, projects and tasks without any process or tool support. Creativity and joy are keys to make great marketing. To have the ability to become creative and to have fun, we want to remove and to automate as much as possible since this will free up time and remove clutter. After all, the reason that we once made a choice to work with marketing is that we love the creativity, the fun and the joy - in combination with a strong business drive. 32 #4. New trends – new KPI’s We live in very exciting times. There are so many trends that will transform business and marketing. Many of these trends will also have an impact on the KPI’s that we want to track. One example of such a trend that will transform the marketing teams is the growth of the Subscription economy. Software as a Service (SaaS) is one example and there are many others. You can subscribe to a truck and pay for the workload or why not subscribe to perfume or sweets to be delivered each month. This is one example of a new trend that will drive the change in marketing and the need for new KPI’s. In a mature subscription company, perhaps 70 or 80% of the revenues are coming from the current subscribers, not from new customers. And the profit ratio will be even higher for the subscribers, new customers will often generate a loss over the first year. Given this, an important KPI in the Subscription economy, will be how much of your marketing efforts that are spent acquiring new customers vs. keeping the current subscribers happy. It seems simple – but it is important since you go to where you measure. And if you don’t keep your focus on the current subscribers, there is an obvious risk that they will leave. Digital channels may not be a new trend, but the full impact of them are now emerging. One impact is of course the abundance of data. Huge amounts of data to analyze and a fantastic opportunity really understand the details in customer behavior. But from a high-level metrics perspective, all this data is often cloudy rather than crystal clear. It is not always easy to separate noise and signals. And although some metrics are crystal clear, they are still 33 not always relevant. Introducing the number of Facebook likes at the board level is not always welcome, since the CxO’s prefer hard sales data. A better idea is to reduce all this data into an actionable metric and work from there. Actionable metrics are something that you can actually use to make better and well informed decisions. A good way forward is just to write down all the small and big decisions that you make. And what information and metrics to you need to make the decisions. Some the decisions can probably be automated, if you had the right metrics at hand. And other will at least be less tricky. #5. Lean marketing The concept of ”lean” was started by Toyota and revolutionized the manufacturing industry. Conceptually it was quite simple, just to finding and removing all the small details in the processes that takes time and does not add value to the end product or to the customers. Another word is to streamline the process, or just to become more efficient.Regardless of which word we are using, it is all about the same thing. To continuously improving the processes, finding all the small things that don’t deliver value and removing or automating these tasks. There are some obvious examples of where to start, for example meetings and e-mails. According to some studies, we spend somewhere between 15% and 40% of our time in different meetings. On top of that we spend time to prepare the meetings. This would have been all fine, but to many of the meetings does not add any value, they are poorly planned and could easily be replaced by smarter ways to collaborate and to share 34 information. Same thing with e-mails. We all know the continuous flow of mails that we send and receive. Many of them could be replaced by smarter ways of communicating. These two examples highlights the advantage and the power of becoming leaner and streamlined. Replacing these tasks with smarter ways to communicate and to share information will free up time. Time that could be spent on making great marketing, rather than sitting in endless meetings and getting stuck in e-mail chains. #6. Doing the right things When we are setting up the brand new marketing plan, we are working hard to get the very best balance between the strategic, long term objectives and the short term tactical results. There is also an important balance between mature products and markets and new and growing areas. I think we all remember the classic matrix with cash-cows, stars and question marks. There are many challenges in marketing, one of them being how to plan the balance between these objectives. We put lots of work into analyzing and defining this balance. But after some time all these smart and carefully balanced activities starts to deviate from the plan. Some activities will take a little bit more resources than expected, taking resources away from other projects. And there will arise new ideas and new activities that are not previously planned for. Somebody with a loud voice will perhaps also have an impact on the plans, without necessarily having a holistic view. Hence there is an obvious risk of sub-optimizing. On top of these risks of deviating from the fine tuned balance, there is a very long list of additional artefacts that the organization wants the marketing team to deliver. 35 Campaigns, brochures, social media activities, events and of course an endless list of marketing content. Unfortunately, there is never an endless pool of resources. Prioritization are critical. And make well informed and smart priorities we must have a good platform of information. We want to know the right facts, so the KPI’s are important. Priorities must also be driven with a holistic view, to avoid sub optimization. This puts more responsibility on the marketing teams to drive their own agenda. #7. Agile transformation Another term that is borrowed from other disciplines is the word agile. It originates from software development where teams realized that the old ways of working did not meet the needs of their fast moving software companies. The objective of becoming agile is to deliver results faster, in increments rather than a big-bang, with higher quality and with increased focus on the end-users. Working agile means to break up the long term planning into smaller and incremental parts. There are also some very interesting organizational impacts. In the centre of agile development are the ”self organizing teams”. These teams are cross functional and process oriented, rather 36 than the traditional silos. As the name suggest, they are organizing the work internally, planning, executing and delivering the content of the sprints. We can do a direct translation into marketing. Rather than doing an annual detailed plan at the end of each year, an agile marketing team will only make a very high level plan for the coming year, based on a few strategic objectives. And then have short, perhaps bi-weekly, planning cycles. The big events will of course be a part of the plan, but all the other activities will be planned bi-weekly. This will enable the teams to continuously focus on the high value activities and continuously prioritize according to strategic and tactical objectives, given the available resources. And just as with agile development, you have to start and stop with the customer. The concept of self organizing and cross functional teams can also be translated into the marketing. Imagine having a team that includes the internal marketing functions as well as sales and product management, that is responsible for an entire campaign. That will not only increase the efficiency of the team but also ensure that the entire organization is participating and taking an ownership of the marketing activities. Or as some companies are doing, having marketing as a part of the self organizing, agile development teams. There are lots of companies that have implemented an agile approach to marketing and the numbers are growing fast. The result of their changes has been both more efficient marketing team and also to improve the results of their marketing activities. 37 #8. Fail fast Failures are important! If we don’t fail sometimes, we are just not trying hard enough. Small failures are obviously less painful and less expensive than large failures. So we want to fail fast and with low risk and cost. By approaching an agile way of working, we can easily reduce the risk of failures, since we can try things out in smaller and more controlled ways. Trying things out also means to actually follow up the result and have an idea whether it is good or not. Once again, the KPI’s are important. #9. Marketing and sales are merging Imagine if all the sales reps wrote and designed their own advertising. Would that be scary and frustrating? Still, that is what Social Selling is all about - every B2B sales rep should be active in Social Media, building their brand. Writing articles and posting on LinkedIn, managing their Twitter accounts and writing their own blogs. All semicoordinated with their role as professional sales reps. This is great news! And also a branding challenge that needs to be adressed, one way or the other. Some companies are training the sales team in Social Selling and others let the marketing teams develop all the content, so that the sales reps can just post and share it. Either way, this is a part of the new way of working for marketing teams and needs to be planned, executed and followed up accordingly. Any marketing manager must ensure that they are producing the relevant content and also that the content is actually used. As well as keeping some track on the sales teams’ way of using of Social Media. 38 #10. Summary and conclusion At the end of the day, the ”I” in ROI will drive the ”R”, the result and business outcome. Not as simple as just reducing the marketing cost. The internal work, the processes, ways of working and supporting technologies are the platforms you need to deliver great marketing with predictive results, from an ROI perspective. The old days, where marketing teams could consist of creative and flamboyant individuals who rejected any kind of process or analysis in advantage for gut feeling, those days are gone. In todays fierce competition it is critical to be agile and prepared for new competition, new technology and new business models. It is also critical to be lean and efficient, to continuously identify and remove any bottlenecks, working as smart as possible. The purpose is to maximize the time and resources spent on doing great marketing, while minimizing the time and effort spent on tasks generating less value. The way to drive these business improvements is to embrace the digital transformation from both a process and tools perspective. Actually, most of the marketing teams are doing their planning in spreadsheets and with very traditional ways of of working. Given the new world of marketing, this is simply not sufficient neither for planning nor for following up results. This is why the ”i” in Marketing ROI is becoming strategic. As marketers, we must rely on a well tuned marketing engine. Just like all the other parts of our organizations are continuously improving their processes and ways of working, we must do the same in order to ensure that we work smart, that we spend our precious time on the right things and keep our focus. 39 Finally – marketing can never be reduced to just simple numbers. Marketing should be creative, fun and innovative. Although the numbers and the KPI’s are important as such, what really counts is how we as marketers use those numbers and KPI’s to fuel our field expertise – in order produce better results and increased marketing ROI! 40 VIEWS & REFLECTIONS ON THE MPM DOMAIN 42 #1. A fresh look at MPM It’s high time we begin a conversation…. To drive revenue through the marketing funnel is the first focus of a profit seeking organization. A rough year is in sight for the marketer, as is the case whenever there is an undesirable fall in economy. However even if the best in class marketers cut back on marketing budget, there need not be an exponential fall in the marketing program as per Gartner’s CRM Summit. More than 75 percent companies affirmed that 20 percent of their budget for marketing will be cut in the forthcoming financial year as per Kimberly Collins, Research Vice President at Stamford Conn. based research firm. The solution, to quote Kimberley Collins is “to spend more – on Marketing Resource Management (MRM)”. The scope of MRM and MPM Marketing Resource Management helps organizations to deliver concistently and consists of a set of processes to optimize marketing efforts, external as well as internal. Agile processes help the organizations to adjust to the lows and highs. Marketing Resource Management can be said to consist of five structured disciplines: #1. Planning & budgeting #2. Production & project management #3. Collection and management of digital assets #4. Managing the distribution of marketing collateral & content #5. Reporting, analytics and optimization 44 To touch base with all areas of Marketing Resource Management is one tough nut to crack. Many large organizations have already got some solutions in place for the management of items No 3 and 4 in the list above, whereas the more financial and strategic aspects of items No 1, 2 and 5 (which together form the scope of MPM – Marketing Performance Management) are sometimes managed just with the help of spreadsheets and Email. Nevertheless, implementing more sophisticated support tools for MPM is what yields the maximum benefits for your organization. Ana lyt ics MRM Pr o d u ctio n& 45 P t (DAM) men e g a an tM Reportin g& nt geme ana tM jec ro nt n utio trib s i d Budgeting ng & nni Pla Colla tera l/c on te With a rapidly approaching futuristic goal in mind, eyes turn as the Marketing Performance Management unveils itself to offer a centralized, single hub for management of data, cross channel distribution, user-centric marketing campaign management across multiple devices and channels. MPM Dig i t a lA ss e 46 #2. A discussion about marketing investments The increasing complexity of modern marketing gives new fuel to the classic question whether marketing spend is a cost or an investment. At this present juncture Return on Marketing Investment (ROMI) is definitely gathering ground. Marketing perhaps has lost ground as a cost center and is rapidly growing to create a substantial driver for business value. In Circa 1700 BC, marketing investment first came into picture by the Code of Hammurabi. The concept is extremely simple- For every Euro, Dollar or Rupee that we spend for marketing, a greater than or equal to rate of sales should be available to us. The need for marketing organizations to track and measure marketing performance for the best Return-On-Investment, has never been greater than right now. At the threshold of this complex challenge, MPM disrupts the current marketing landscape to build, versatile, robust, scalable and responsive mechanisms which takes marketing to the next level of quality enhancement. A variety of channels are used in the current scenario to harness marketing investments. Return on Marketing Investments (ROMI) is gaining rapid popularity. This popularity has been driven by the need for repositioning marketing, from being a cost center to becoming a strategic driver of businesses value. “Marketing investments” is a challenging subject. The concept is simple; for every dollar that we spend on the marketing, we must get more than a dollar back (often in the form of recognizable sales revenues). The more we get in returns, the more we shall continue to invest. 47 But from perspectives of finance or accounting, it is not that simple. An investment is not formally recognized just because money is being spent on marketing, not unless it somehow ends up on the balance sheet as an asset. So from the strict perspectives of accounting, spending in marketing is rarely considered to be investing. It is only costs of conducting business. In such contexts, the term “ROMI” does not make sense. It is not accurate. A person can claim that marketing results actually do end up in balance sheets under goodwill’s or intangible assets. Reputation and brands have monetary values. People see this clearly in acquisitions, with focus on branding. This can be seen as investments from the perspective of accounting. There are standards as to how to value brand’s that is the “ISO 10668”. This standard, while it defines actual values of brands, it does not define the activities of marketing which builds these values. Details and words are important. However, regardless of whether you call your marketing whilst spending an investment or a cost, it is equally important to keep track of how you are spending it. You have to do comparison of budget to actuals, thereby keeping track of outcome for the business. Formalities as whether marketing spend is cost or investment make an interesting topic for discussion. But regardless it is difficult to keep the spending under proper control, especially for organizations that lack proper IT solutions designed for optimizing marketing activities from A-Z, covering the full aspect of resources as well as effects. 48 #3. The 6 A’s of successful MPM Alignment – Best in class marketers serve the organization by taking an entirely different approach when it comes to aligning business and marketing. This factor is known and marked with statistical and insightful significance. Business results are a direct line of demarcation between marketing activities as well as investments which go beyond sales activities. Marketing in any organization with Marketing Performance Management serve to facilitate a perfect alignment in a consumer centric scenario, which has a great impact on business results. Accountability – Valued marketers working alongside Marketing Performance Management strive to develop a framework which tends to report as well as measure the Key Performance Metrics pertaining to the contribution of marketing to the day-to-day running of the organization. Analytics – All data needs to be synthesized to gain insights about consumer behavior so that smart investment models can come into the picture. Analytical muscles have to be flexed to enable the marketing department to give best results. Automation – The replacing of manual ad-hoc processes with systemized workflows, and the automation of communication execution in various channels, represents a great opportunity for MPM – much thanks to all the data generated which can be used as insights for performance measurement. 49 #3. The 6 A’s of successful MPM Alignment – Best in class marketers serve the organization by taking an entirely different approach when it comes to aligning business and marketing. This factor is known and marked with statistical and insightful significance. Business results are a direct line of demarcation between marketing activities as well as investments which go beyond sales activities. Marketing in any organization with Marketing Performance Management serve to facilitate a perfect alignment in a consumer centric scenario, which has a great impact on business results. Accountability – Valued marketers working alongside Marketing Performance Management strive to develop a framework which tends to report as well as measure the Key Performance Metrics pertaining to the contribution of marketing to the day-to-day running of the organization. Analytics – All data needs to be synthesized to gain insights about consumer behavior so that smart investment models can come into the picture. Analytical muscles have to be flexed to enable the marketing department to give best results. Automation – The replacing of manual ad-hoc processes with systemized workflows, and the automation of communication execution in various channels, represents a great opportunity for MPM – much thanks to all the data generated which can be used as insights for performance measurement. Alliances – Marketing does not exist on its own. It has to form explicit and expert alliances with IT, Finance and Sales departments and also the product and service portfolios. Original source of the 6 A-concept is VisionEdge Marketing Inc. Author: Laura Patterson. 50 Assessment – Benchmarking as well as improvement continually lies at the heart of the assessment of the marketing department. All these fall under the auspices of a user centric culture where the focus is on improvement amongst management, stakeholders, and employees. Herein steps in Marketing Performance Management aspiring valued marketers to become centers of excellences. Fo rm or ei n- de pt hc on te n ta bo ut t he 6A ’s o fM PM ,p lea se v is it t he we bs i te of Vi sio nE dg eM ar ke t ing :w ww .vi s ion ed ge ma rke t in g .c om A A A A A A 51 #4. MPM in an Agile World The Agile is the in-thing in the contemporary business scenario of multichannel fast paced economies where the marketers are not entitled to months of time and energies for a single marketing project. To produce and innovate on the fly is their motive. CMG Partners released the results of its sixth-annual CMO’s Agenda which clearly states that “Agile for Marketing (A4M) drives long-term marketing strategies with short-term, customer-focused iterative projects that improve responsiveness and relevance. It allows for faster creative, more testing, smarter improvements and better results.” Sixty-three percent of CMOs rate agility as a critical priority while only forty percent rate agility as their second nature, as defined in the above mentioned survey. Significant and substantial market growth is clearly depicted by those CMOs who are agile. The CMOs need a solution which orients the entire suite of marketing activities around a constant set of changes to give rise to a more integrated, collaborative end result. If an organization is agile increased speed to market and relevant end products are in lieu. However, a lot of CMOs are not familiar with agility in marketing applications thereby giving rise to slower growth, the rate of adoption is growing but it’s still a nascent concept. Inconsistency sets in around the methodology of agile when it is used in the marketing scenarios. Quick decision maker organizations are driven by data and they prioritize constantly and thereby reinforce iterative customer centered and high value structure. The CMOs who have deciphered the agile approach will be the first amongst equals in the always-connected, always-on market where flexibility and speed are the kings. 52 Marketers who wait for the nest perfect slot are not keen to take advantage of agile approaches to marketing activities and they will refrain from making the big splash. Current feedback from various marketing organizations firmly reaffirm this fact. 53 #5. Financials for marketing Very few of us that are passionate about marketing, have chosen this career because of love for accounting. But accounting and financials are important for what we are doing. If we can’t manage marketing financials, we have a challenge. Since marketing is becoming more strategic and more integrated with sales and delivery processes, we see stronger demands for the marketing executives to keep track on the financials. Both in terms of costs and spendings as well as to continuously improve the internal efficiency of the marketing team. Getting more more and better marketing for the same spending. As marketing executives we are expected to stay on top of the financial situation, besides all the work we do that sometimes can be perceived as a bit fluffy. On top of this, financials for marketing is different from more traditional accounting. It is not only about allocating funds and resources to different activities, but also about co-funding with partners. Setting the marketing budget As a high level description, financials for marketeers is about how to manage the marketing budget in the best way. As a marketing manager you will receive a budget for marketing spending or as we sometimes say, marketing investments. A marketing budget can be decided on a yearly, quarterly or even a monthly basis. This means, of course, that the spending is limited to each timeframe.There are some different ways in which that budget can be decided on. 54 Some companies base the budget on a pre-defined percentage of the sales revenue, other companies base the budget on the last year’s spending. Another way is to apply a bottom-up approach, where you base the marketing budget on the activities and projects that the marketing team plans in order to accomplish the strategic and tactical objectives. In real life, most companies are working with a combination of the three approaches. The process of defining the budget is often an iterative process or negotiation between the CFO and the marketing organization. Allocating funds and approval processes When there is an agreement on the marketing budget, the funds are then allocated to different projects and campaigns and distributed across channels, products, strategic and tactical marketing. We see many different approaches to approval processes, but at the end of the day every marketing organization are using some kind of approval process. In smaller organizations this can be a very light and simple way of working, you just agree over a cup of coffee. In other organizations, there are more formal processes. In general, the larger and more complex markering organizations, the more formal and process driven are the approval processes. It can seem very tempting to reduce the approval processes to an ”ok over the coffee” but it will be very difficult to maintain this approach as the company grows and you need to ensure that the marketing message and spendings are streamlined. On the other hand, a complex and time consuming approval process can kill initiatives and creativity. The best way 55 forward is to work on the processes with a focus on the tools that supports them. As long as the approval process is streamlined, simple, quick and efficient, everyone will accept and understand the formality. Besides the approval process, the actual funding of the different activities, campaigns and projects is a key area. The distribution of marketing funds differ between industries and companies. It can be done in a simple or more complex way, depending on the needs for details and the size of the organization. A large marketing organization that covers several countries, products lines and customers, will of course require a more structured approach than a marketing team with only one product or a single geographic market. 56 Deliver great marketing assets or internal spreadsheets? When executing the marketing plan, there is a continuous need to keep track on spendings. Planned costs in the budget should be compared to the actual costs. There is often a deviation between these, something that can cause problems. Especially if there are uncertainties on how much of the funds that actually remains. There is also a more critical problem, if ”less important activities” are eating up the fundings for ”more important projects” the total effectiveness of the marketing team will decrease. There is also a very simple reason for the marketing executives to ensure that they keep track on the spendings vs budgets - just to keep the CFO and controlling team off our backs. Unfortunately the traditional financial systems does not provide the right details and granularity needed for today’s marketing, since there are special needs and requirements. So in every large marketing team, there are some poor individuals who has to manually collect the right information for different systems, clean the data and then use sophisticated and complex spreadsheets to keep on track. Needless to say this is very time-consuming and prone for mistakes and endless discussions on details. A modern and reliable system, designed for the needs of marketing, is a huge help for a situation like this. Both to ensure the quality of the data and to streamline the process, freeing up resources to deliver great marketing assets, rather than producing internal spreadsheets. 57 Partner funded marketing A big part of the marketing activities are done together with partners. Depending on the business, partners can co-fund your marketing campaigns or your own company can sponsor campaigns that are managed by your partners. We also see some costumers that are continuously using both approaches. In the telecom business for example, consumer electronic brands are co-funding activities with the telecom service providers and telecom service providers are co-funding activities with retailers and consumer electronic brands. Yes, this is ofter very complex! On top of the complexity, co-funded marketing activities often represents a big part of marketing funding and is often agreed on with special pre-requisites. So the reporting of the spendingngs between partners is often an important part of the collaboration. Co-funding in this way, is quite unique to marketing and rarely supported by any traditional financial systems. This complexity is just a part of the business and we have to live with it, one way or the other. Some companies are trying to simplify, for example by distributing the marketing budget to each product unit or to each country. Others are going the other way and centralizing the marketing budget. Either way can work, depending on the circumstances and culture. The best way is probably to ensure that you have a solution in place to support and to automate the marketing financials. Unfortunately, not many of the financial systems are implemented in a way to ensure this. On the contrary, we more often see customers struggling to get the right information out of their old, legacy financial systems. 58 #6. Improving Marketing ROI At Musqot, we are passionate about helping our customers to improve the return of their marketing investments, their Marketing ROI. Helping our customers to work smarter, more efficiently and enabling them to make their marketing more effective. The purpose of marketing ROI is to maximize the business outcome of marketing spendings and to increase the efficiency of the marketing organization. It has no intrinsic value, the number itself is not that relevant. So keep the eyes on the ball - the focus is to improve the business outcome and to work smarter. Some organizations are working with marketing ROI as a math exercise, just to get a number out of it. At Musqot, we think this approach is an oversimplification. Metrics are very important, but a single number can be misleading. For example, if you are just doing this as math exercise - your relative ROI can increase while the actual business results decrease. So although marketing ROI is a strategic metric, it is not the only metric and perhaps not even the most important, at least not unless it is put in the perspective of total revenue volumes (actual as well as targeted). Boosting marketing ROI requires work on two fronts. One side is to increase the efficiency in the internal processes, working smarter and removing any clutter. The other side of the is to focus on the marketing activities that are most effective, and continuously striving towards raising the effectiveness of the others. So we need to find the best metrics for both the internal efficiency and the business outcome of marketing. This 59 will require some thinking and a good understanding about the current situation as well as the objective. Is the key objective to produce more marketing assets with the same resources or is it more important to cut the leadtimes from idea to activity? Same thing with the business outcome! Depending on the business and the industry, there are different metrics. The actual sales revenue is a great metric for fast moving consumer goods, but not so relevant in a B2B environment where the sales process is 9-12 months or longer. It is also important to consider how to use strategic and tactical metrics. Consumer awareness or brand recognition for example, takes long time to establish and to maintain. They also have a huge business value. Facebook likes on the other hand, are great to quickly see if a message is flying, but rarely provides any direct links to sales. Finally, don’t let perfect be the enemy of good! The focus and overall objective is to continuously improve the business outcome and the internal efficiency. Keep it simple, and keep working with that objective. 60 61 #7. MPM Procurement advice Subscribed cloud service The most scalable and cost efficient option is to select a true cloud application, which you can use as a subscribed service. These services are often sold on a user account basis, making it easy for your organization to start with a small pilot group and then gradually expand until all your marketers, and other internal/external stakeholders, are using the service. Proven platform technology Stay clear of proprietary platforms! Choosing an application with unique and exclusive features is fine, after all you will benefit immensely from an application with dashboards, workflows, tabs and graphic interfaces that are customized specifically for marketing user scenarios. However the underlying platform technology should be as standardized as possible. Applications built on custom technology all the way through, even in the infrastructure and platform layers, will grow old quickly – and it will then be costly for the application provider, and their clients, to upgrade and maintain stability and performance. Usability is king It doesn’t matter how advanced and extensive functionality a certain application is equipped with - it will not fly unless users can manage to understand and appreciate it. So don’t make the mistake to pick whatever application has the most “checks” in the requirement specification, because 62 chances are that many of those features might not be within practical reach for your organization’s users anyway. Needless to say, advanced functionality and usability does not necessarily have to compete with each other. Try to find a good match, just remember which one is most important to determine the success of your implementation in the end. #8. Impressing the executive team? Marketing managers are often struggling to gain full respect from the executive teams. The reason is often pretty simple, it is because of the information they present. The executive teams are looking for numbers and KPI’s that shows business value. Sales numbers, production costs and other efficiency metrics. Business data that can be used to make decisions to improve the business. Marketing managers however, are often presenting other types of data. For example advertising reach, number of visitors at events, hits on the website and likes on Facebook. These are important metrics to manage the daily operations within a marketing team. But they are not the kind of business metrics that the executive team is looking for, since they are not directly linked to any business results. There are better metrics and smarter KPIs that marketing managers could use to grow the respect from their executive teams. At Musqot we often recommend our customers to measure the number of leads. This is a simple and very powerful metric. It is easy to follow up and to link to the marketing activities and you can also attach a value to each lead. Provided that you know the closing ratio and average deal size – you can easily calculate the value of 63 each lead. And since the leads can be linked to a specific marketing activity or a combination of activities, it is a great KPI that clearly shows the business contribution of the marketing organization. Measuring the number of new leads and correlating them with the marketing activities is one of the easiest and yet most valuable marketing metrics for B2B companies. For B2C companies, it is often easier to identify the relationship between marketing efforts and revenue. Although it can be challenging to directly correlate a marketing activity to the sales, there are some short-cuts. One is to isolate sales revenues and marketing activities during a specific period of time, and visualizing them in the same calendar view. Simple and very powerful. So what the marketing managers need in order to get the recognition they deserve, is simply to be equipped with the right information, the right KPIs. To be prepared with relevant business metrics, rather than ”vanity metrics” such as hits on the website, no of visitors or likes on Facebook. #9. Marketing efforts, efficient and effective! This week we are honoured to invite a guest blogger here on musqot.com/news-blog Jussi Pullola is a senior consultant at Vere Oy, and a specialist on the topic of digital business transformation. In his post he shares a number of interesting views on why some organizations are still (in 2016! not addressing Marketing ROI as a top priority. Thanks Jussi – for sharing this wake up call! 64 Marketing ROI should not be measured? “Marketing ROI is not interesting, we do not measure it.” I remember having read such a sentence in a random article / interview some time ago. And this bothered me – why would it not? The first time I came across this concept was in the early 2000s, and the same challenges still probably exist in the B2B sector. We measure almost all the activities of the company using a number of methods, be it production, logistics, sales or economy, but we still do not respond to the marketing efforts. Strange. I wonder if the reason for the lack of interest is the fact that ROI measurement has always been quite difficult. It is easier to measure the so-called easy marketing metrics – page visits, clicks, pages, CTA conversions, campaigns, attractiveness, visibility, brand awareness, etc. But what about those nasty sales figures? What if the campaign carried out by our advertising agency that we were excited about was not really as good as we imagined it to be? Or if it was good, why was it a success, and where and for which target group did it work the best? Is marketing still planned with feelings instead of numbers? What is the proper efficiency and effectiveness of business marketing efforts? What is the proper efficiency and effectiveness of business marketing efforts? One reason for the lack of interest might be the established practices and attitudes. Marketing has always played an important role in building corporate image and production of the material, but it has not necessarily been an integral part of our customer-oriented sales management experience. If marketing has been a part of the so-called normal cost 65 structure, the effectiveness of the business might not have been in the interest of the top management. There are exceptions to this, of course. To my delight, I recently encountered very successful marketing-oriented companies that have embraced the new customer-oriented thinking and have changed their behaviour. These companies stand out because of one positive factor – the results. At what stage are the marketing organizations trained to use and benefit from a CRM system? I have been involved in a number of CRM projects and training sessions, and the fundamental goal has always been to get the sales organization motivated to use the system as a whole. It has not been easy; not for me either. But at what stage are the marketing organizations trained to use and take advantage of the system? And what about other experts who are involved in the sales and marketing processes? I believe that these objectives often come secondary to the first objective, i.e. to bind sales personnel to use the solution. However in practise it would be much better to include the marketing scope already from step 1. Results of marketing are quite difficult to measure without having the knowledge of marketing measures and ancillary activities, and this needs to be taken into consideration early in the CRM process. In addition, the measurement challenge for marketing ROI is the fact that all the marketing costs should be clearly connected to the business as a whole including expenses and sales revenue. How do you measure the real cost of marketing measures during all the stages? This can be done by beginning with the use of organization’s own resources as well as other external services, such as advertising agencies, web-partners, printers, event organizers, etc. 66 Do you get really the allocated costs without special and difficult calculations, and can you demonstrate if these measures create some sort of impact on the business? If an online measurement is possible, then what about the other offline marketing actions? What could be done to make marketing ROI one of the business management tools? The first step should be to give up the so-called spreadsheetmarketing – when the marketing plan is created by a spreadsheet program. I confess that I have used this method a lot and for far too long. Excel is a great tool for processing data, but if marketing plans are being carried out with this method to this day, it is time that we wake up. Is a spreadsheet plan / a file integrated with other key management systems? Is this plan visible throughout the sales and marketing organizations in the implementation of different stages? I congratulate your company if this is the case, but I would argue that doing so is quite rare and difficult. Measurement of marketing ROI is challenging. However, this does not mean that it should not be pursued because it is possible. If you want to see the impact of marketing investment on a business, even in a little more detailed level, be it for electronic or printed products, measuring ROI will be worthwhile to invest in. I would argue that spreadsheet-marketing is dead and that new marketing tools are quickly invading the field of marketing. Who in the responsible of marketing would not want to know, whether his work can impact on the company to make profit? 67 #10. Marketing in the new service economy SaaS, Software as a Service, was one of the first steps towards the service economy. Now we see other industries and products taking the same path. Caterpillar asks their customers how much earth they need to move – not how many machines they want to buy. Same thing with Rolls-Royce – they ask their customers how many hours they will fly, not how many jet engines they want to buy. This road towards a service economy, where we pay by the usage and not for the ownership is growing at ballistic speed. Why pay for the ownership of a car, when you can pay for the transportation? IoT, Internet of Things, is one of the technology enablers to the service economy. Without connected products and devices you can’t deliver SLA’s or even measure the usage. But IoT will also be important from another perspective. All these connected products and devices will continuously improve the way they deliver value. Both by learning about their environment and usage as well as delivering continuous upgrades with new features and improved functionality. Together, the service economy and the IoT are fueling each other to create a perfect storm. One part of this perfect storm is that the customer expectations will shift, from buying a product to subscribing to a service. A service that continuously will become better and better. Customers are moving from a product experience to a subscription experience. Service economy will obviously drive a fundamental change in business models and the way we manage the companies. An important change is that the customers are no longer 68 profitable from day one, when they sign the deal, but will become profitable over time. Marketing is one area that will be impacted by these changes. When customers are paying for the usage, with a subscription model, the old school of marketing is no longer relevant. The classic sales and marketing funnel is becoming outdated. The deal is not closed when the customer buys the product, as it used to be. Instead there is a new long term customer relationship that starts. And the customer will not be profitable unless they are happy with the service that they subscribe to. From a marketing perspective, this is a fundamental shift. Rather than being the engine that creates new leads for the sales teams, marketing communication is evolving into an engine to manage the entire customer journey. From the first contact to the continuous subscription experience. To manage this long term customer communication, with the focus to generate a positive user experience rather than ”selling a cool product”, marketeers will need a new way of working and a new generation of supporting tools. The marketing teams must be far more agile than the traditional 12 months marketing plan. The marketing communications must be tightly connected to the agile and incremental development, since the customers are expecting the products that they use, to become better and smarter. It seems like an oxymoron, but to become agile, you need structure and all the information at your fingertips. To make continuous changes, you have to understand the impact of them. The need for a new generation of marketing tools has never been more obvious than now. 69 #11. Data driven marketing and the streetlight effect Funny cartoons like this has been around for a long time and we have all enjoyed them. The poor man is looking for his wallet in the wrong place, since it is too dark to look where it actually is. We are smiling and laughing with the poor man – and then doing the same mistake ourselves! In marketing for example, most companies want to understand the business outcome of the marketing activities. And it is very common to use metrics like website hits or likes on Facebook, just because they are simple the measure. They are under the streetlight, just like the poor man in the cartoon. Since the objective is to understand the business value, here at Musqot we recommend our customers to use metrics and KPI’s that indicates just that. For example sales revenue, number of leads or pipeline value. These metrics that clearly indicates the marketing ROI can often be found in the CRM system, which is typically being used by sales teams rather than marketing teams. But to find what we are looking for, we need to move away from the streetlight and start looking where the wallet really is. #12. A marketing story from a small town in Sweden My great-grandfather lived in, Kalmar, a small town in Sweden, back in the early 20th century. He was a painter and owned a small company doing different paint jobs. There are still some churches around Kalmar, where he did the paintwork with all the religious pictures. But his core business was to do advertising paintings. Like ad’s on walls, billboards, posters, windows and even paint jobs on the first cars. One of his key selling point, to stand out in the small business-to-business market in Kalmar, was to focus on ”advertising effectiveness”. His marketing communication was built on the terms ”Stylish and effective”. His advertising jobs should looks smart and stylish but also deliver a business value. This is very interesting, from several perspectives. From a personal view it is special that I work with the same business objectives that my great grandfather, to help customers to increase the impact of their marketing efforts. But it is also very interesting from a historical and business perspective. Just to realize that the business challenges were the same for marketers a hundred years back. To increase the impact of marketing activities. For more than hundred years this has been a business issue and also a business opportunity, to maximize the marketing effects. Even though the advertising and business has been through several transformations since the early 20th century, the fundamental questions are the same. How to maximize the impact of my marketing spendings. 71 A hundred years back things were less complicated, there was not as many channels and the content production was not as complex. At that time there was no need for tools to drive the activity and resource planning. And from a budget perspective, my guess is that the local fishmonger and inn-keeper paid directly from the cash register. It is obvious that we now need tools to support todays complex business and channel environment. But the fundamental need to understand the business outcome of the marketing activities is still very similar. Just like in the early 20th century, in small town in the Swedish countryside. 72 73 #13. 5 trends that will re-define B2B marketing We see some powerful trends that are working together and fueling each other to re-define B2B marketing. This perfect storm will change the fundamentals and as a result increase the strategic importance of marketing. The way that these trends work together is very exciting and will create new opportunities for the marketing teams. Changes in the customer buying process There are several studies pointing in the same direction. Customers will drive the purchasing process much further, before engaging with the suppliers and sales teams. This will change the way we work with lead generation, cold calling and the end-to-end sales cycle. Marketing will be in the lead to drive this change. Integration between marketing and sales Given the new customer behavior, the old wall between marketing and sales must come down. These are not two different processes, we can’t separate the marketing activities from sales. It is one single end-to-end process – from when the customer need arises to when the deal is closed. Becoming agile Changes are the new normal. We need to adapt and to embrace continuous changes in markets, competitors, products, technologies and business models. The good old days when we could make a business plan in October to cover the next year are gone. We are constantly adapting to changes and disruptions. In order to be agile and swift, 74 we need control. It sounds like a contradiction, but trying to manage changes without control will lead to chaos. Digital channels This is an open door, digital channels are not new. But they will keep growing and they will continue to re-define the way we drive business. They will change communication patterns, processes and the way we think about our ways of working. The CMO will soon buy more IT than the CIO. This on-going change is an important trend. Measure the result With all these trends working together to re-define B2B marketing and to increase the strategic importance of marketing – we will see new types of decisions. Decisions that will require new information and new KPI’s. The standard ones we see today, for example number of leads and campaign efficiency, will still be important. But there will also be an increasing need for visualization of trends and information about increasingly complex combinations of activities. At Musqot we have embraced these trends and developed a solution to support the new exciting world of marketing. We call it re-thinking marketing. 75 #14. Premium pricing – the core of brand marketing! Marketing departments are often caught between several disciplines where they are accountable, but don’t have the full responsibility. Marketing is for example often accountable for revenue growth, although it is the sales organization that has the full responsibility. Same thing with product collateral. Marketing teams have some accountability, but the full responsibility is actually in the hands of product management. However, there are of course areas where marketing has the full responsibility and ownership. One such area is branding. The brand positioning is a corporate strategy – owned and managed by the marketing & communication department. A direct sales related aspect, which is tightly connected with brand value, and where the marketing function is therefore responsible, is the ability to charge a premium. This the soul of brand marketing – to build perceived values that the customer is willing to pay a premium price for. The price difference, between the premium price and the average market price, is one way of defining the business value that marketing delivers. A very interesting KPI to follow up over time and apply in trend analytics. 76 #15. Innovation & Marketing To Be Successful? Innovation is a key for organizations to be successful and even to survive. Given the continuous disruptions, new types of competition and the ballistic speed of changes, the capability to innovate is critical. Every company must engage and invest to bring new products to the market. This is a challenge from many perspective. Unfortunately only a few of the new, innovative products will meet their business objectives. From a product perspective there are some important metrics. How many new products that are released, how much of the total sales that are delivered by new products and how much the R&D teams are investing in developing radical innovations. Just a few examples on how to measure innovation. From a marketing perspective we don’t see metrics like that. Very few organizations follow up on how much of the marketing budget is spent on new, innovative products and services. This is a strategic problem. Organizations that don’t have control over the marketing budget, in regards to innovation, are exposed to a huge risk that both the investment in R&D and marketing are wasted. If they don’t allocate enough resources, they are putting the entire business at risk. If they spend to much, there is an obvious risk that the overspending is wasted. So the marketing organization needs a good platform to know where they spend the budget and how they spend it. This balance between the spending on disruptive solutions and the traditional products will differ from company to company and from industry to industry. But there is an important characteristic for the successful companies, regardless of the market. 77 Successful companies are data driven and make their decisions and priorities, based on analysis and facts. They can see from day one if a campaign is successful or not, by comparing with historical data. And to know, based on facts and numbers, how much money and resources are spent on innovative products and solutions. #16. What to measure – and why? Often when we meet with CMOs they tell us about their frustrations on how to follow up or measure the results of their marketing activities. Everyone agrees on the importance – but they are struggling with where to begin. Much of this frustration is based on the abundance of information from so many different sources. Where to start, everything seems to be important? A good starting point is to reflect about what decisions you want to make. And then to analyze what data you need to make those decisions. For example, if you want to verify if a new marketing campaign is on track and to decide if you need to take any actions, you will need a first, basic indication, for example hits on a website. You also need a reference, to compare that number of hits with a previous campaign that was successful. Now it becomes obvious what data we need for this decision; historical data and current data on the number of hits on the website and an example of a successful campaign to compare with. When you have this information you can make a fact based decision on whether to run the campaign as planned or if you need to make any changes. Now, lets assume that the first indications shows that the campaign is not working as planned, you will probably make some changes. 78 But to make these changes you need to understand the impact, on budgets, resources and other activities. If you need to reschedule other activities, what will the impact be on other strategic initiatives, on other campaigns. By following a decision process like this, you will get a good understanding of your actual needs for information and data. Even though this is a very simplified example, it highlights how you can identify the need for KPI:s based on your needs, rather than what is available. Information and data by itself is of little value – until you need it to make a decision. 79 MUSQOT APP FROM A CUSTOMER PERSPECTIVE 80 Flexible solution for managing our marketing plan and performance metrics “We have chosen to work with Musqot for their solution’s flexibility, which lets us setup marketing plan hierarchies, workflows, dashboards and performance metrics – based on the requirements that are relevant specifically for our marketing operations here at Lavazza” Lavazza Nordic, Robert Ameln (Managing Director) ★★★★★ 82 Selecting Musqot after evaluating different options “At Sqore we have been evaluating different options for “marketing planning & performance management systems”, and came to the conclusion that we wanted to go for the Musqot solution.” Sqore, Maria Paulsson Rönnbäck (COO ★★★★★ 83 Highly customizable calendar to suit your needs, & best customer support I have ever experienced! We were looking for a complete solution for tracking a complicated marketing system with different locations, budgets, users, tasks, channels, etc. Musqot was the ONLY Salesforce app we found that met our requirements. We just finished customizing our version and are impressed at many of the features that weren’t even in our requirements. Here are a few of the features we are currently excited about; •We can easily see the remaining budget for a project, location or year. •We can assign tasks to coworkers. •We can share files, comments, links, assign tasks, create polls, all from the musqot chatter sidebar. •We can see all projects, tasks, milestones, etc on the Gantt view. Musqot even shows us which product or channel the activity is associated with by using icons and color labels. •We can customize many of the items ourselves, but Musqot has been amazing at implementing our customization requests themselves. 84 We work with many vendors, but none communicate as clearly, quickly or patiently as Oscar and his team at Musqot, who consistently provided simple, well thought-out solutions to complex problems. We highly recommend this solution and this team. Bordner Installation Group, John Schroeder (Marketing & Technology Director) ★★★★★ Smart app to plan, organize and squeeze the most out of the Marketing campaigns We have a need to increase our marketing efficiency, and this App helps us optimize marketing processes and results. Musqot is easy to install and use, and include powerful features to plan, organize and evaluate marketing activities. The dashboards are great for marketing analytics and solve many of our previous reporting challenges. The Gantt view provides a graphic visualization of all aspects of our marketing plan. Intelliwell, Fredrik Forssberg (CEO) ★★★★★ 85 Multi-faceted with great customer support Since we use force.com, we did not have any marketing objects available. We could have added custom objects but while researching our options, we discovered Musqot. This multi-facted, multi-layered application provides a comprehensive record of all of our Marketing objectives, plans, campaigns and activities associated with each campaign. We are able to assign budgets per plan or campaign and track the actual expenditures against those budgets. All of this is also viewed by a Gant Chart which provides a color-coded, ‘date range specific’ view of our marketing initiatives. I would really like to share how attentive and helpful sales and customer support proved to be in our process of buying the application and especially the initial set up in Salesforce. We must have communicated daily for a several weeks while determining the the best way to set this up for our organization. Along with instruction and best practices support, the Musqot team provided assistance as to how their model woould work with our plan and could be greatly customized to help us achieve optimal results. I sincerely appreciate how effortless the 86 implementation was considering the amount of informaton we wanted to enter into the system and track. All of this was implemented with the low cost of the app and the very gracious support of the team. Archer Well Company Inc., Nancy Franklin (Salesforce Special Projects Lead) ★★★★★ 87 www.musqot.com #MusqotTweet [email protected] Please participate in our journey, send your comments and feedback to [email protected]