alignment
Weaving Contextual Data into Models
Many companies are developing opportunity scoring models which essentially assign a predetermined numerical score to specific behaviors or statuses within a database. The purpose of opportunity scoring is help sales people know which opportunities are sales ready and worthy, and therefore take priority. Often variables such as title, company, and industry, serve as the basis for the scoring model. However, behaviors can be used too, such as the completion of a contact form, visiting a particular page on the website, participating or viewing a demo, etc. Contextual data adds another dimension to the model by weaving in predisposition information that reflects content, timing and frequency-for example what products they currently use, the last time they purchased, their complete buying history, the types of keywords they used in their search, etc.
Keep in mind, timing is everything. To be effective, contextual data must be delivered to the right person, at the right time, within an actionable context. For example, the date of a key customer’s contract renewal is posted in your CRM system all year long, but that doesn’t mean you’ll remember or even see it. Think how much more useful that data becomes when your system automatically alerts you to the fact that it’s the customer’s renewal date. Sending email messages about renewals too early just creates noise at best and at worst suggests you don’t know their renewal date. Customers are more likely to respond to call to action when it is in context of their workflow. Communication that is contextual is more personal and as a result feels more authentic, shows value, and leads customers want to act. As a result, you can reduce the cost of customer acquisition and the cost of sales.
The end goal of contextual data is to connect with the buyer when they are most predisposed to buy. As a result, you can use contextual data to help build propensity to purchase models, for prioritizing opportunities to support opportunity scoring, to develop more personalized messages, and select the best mix of channels.
This same concept of contextual data can be used to build propensity to purchase models. By identifying the winning experiences associated with a particular segment, you can use this information to craft more relevant messages to similar targets to increase uptake.
Personalization is a compelling and challenging proposition. It’s a moving target and therefore requires a test and learn approach. By adding contextual data into the process you can make your personalization efforts more effective and more relevant.
3 Attributes to Extend Your CMO Longevity
As 2013 winds down and we prepare to enter 2014, there are bound to be a few changes in the CMO line up. You say, that’s not news, CMO tenure is always a bit tenuous. But actually, that is less true today than ever. In SpencerStuart’s 8th Annual CMO Tenure Study, it was reported that CMO tenure is now nearly 4 years, compared to just 2 years back in 2006. While CMO tenure varies across industries, there are several attributes long- tenured CMOs share. First and foremost, these CMOs can demonstrate positive impact on the company and have impact beyond the “marketing agenda.” They also tend think more like business-people who are able to provide strategic direction and use data and analytics to make fact-based decisions.
In addition to being an exceptional, technically proficient marketer, there are three attributes we see among successful long-term CMOs.
1. Customer-centric. These tenured CMOs connect regularly with customers. They do more than conduct voice of customer research, review customer data, or meet with a customer advisory board. They are actively and regularly engaged in customer conversations. Do you describe your customers for example as engineers with X years of experience in Y industries, Y accreditations, who attends B events, reads Y publications, and uses Z social media? If this example seems familiar you may be missing the mark. These long-tenured CMOs have a deeper understanding of their customers’ needs, wants, emotional state and motivations, what it takes to engage them, and the kind of experience that needs to be delivered. These CMOs serve as the window into the customer for their companies. They are relentless in their pursuit to know and understand the customer.
2. Outcome-oriented. It is clear to the leadership team that these CMOs have marketing well aligned to the business with metrics and performance targets focused on producing business outcomes rather than marketing outputs. These CMOs understand that outputs such as visitors, fans, followers, etc. create more contacts, connections and engagements that are important. They also understand that their job is to translate these outputs into something relevant and meaningful to the leadership team, such as how marketing’s contribution is reducing the sales cycle/accelerating customer acquisition, reducing the cost of acquisition or retention, and improving product adoption and win rates. These CMOs have an excellent handle on what touch points and channels are most effective and efficient depending on the needle that needs to be moved.
3. Alliance-savvy. There’s been a great deal of coverage on how important it is for the CMO to have solid relationships with their Sales, IT, and Finance colleagues, and our research shows that Best-in-Class CMOs do more than that. These CMOs have forged formal explicit partnerships with these counterparts. They invest in these alliances because they believe that the partnership will enable the organization to be more customer-centric and more competitive. As a result, these companies are able to enter new markets and bring new products and services to market faster. What is different about the alliances formed by these CMOs? They work with their colleagues to plan, form, design, and manage a formal working agreement that focuses on developing the right working relationship, taking into the account that each function most likely operates differently. They create and execute an agreement that emphasizes how the organization’s committed resources will achieve a common set of objectives, how to leverage the differences to the company’s advantage, and how these differences are designed to facilitate collaborative rather than competitive behaviors among all the members of each team. Performance metrics are established to support the alliance with a focus on both the outcome of the alliance as well as the process.
Whether it be the stream of green lights you hit on the way to work or the person that holds the door for you as you juggle groceries, at the end of the day, we are most appreciative of the people and things that make our lives easier. Although technological innovation and automation have given us the ability to soothe many of our woes, we cannot forget that the human element is at the center of all things marketing. In light of this, we must ask ourselves, “Would I be satisfied as a customer or colleague in this process, and if not, how could I change it?” By exemplifying these traits of a successful CMO, the outlook of your operations will shift from being self-serving to philanthropic in nature.
Performance Management For Marketers
As early as the 1940s, business leaders began developing processes to enable and evaluate how employees contribute to the success of the organization. These processes became the foundation for what we refer to as performance management. With the increased pressure on business leaders to be more personally accountable for the performance and conduct of their organizations, the emphasis on performance management has trickled down and across the organization, which includes marketing.
Performance management focuses on optimizing individual or group performance in order to achieve the organization’s key initiatives and objectives – and it includes the metrics and the data, measurement, alignment and analytical processes, methodologies, capabilities and systems needed to manage the performance of an organization. A sound marketing performance management process is essential for enabling marketing professionals to demonstrate and communicate the impact of marketing on — and contribution to — the organization.
Lately, we’ve been hearing many colleagues use three performance management terms interchangeably: marketing effectiveness, marketing accountability and marketing measurement.
While these three terms are complementary, they are also distinct from one another. Each serves an important role in the performance management process.
Here is one way to understand the nuances surrounding these terms and help you use them in your performance management journey.
Marketing accountability is a broad concept that reflects the ability of marketing to explain the basis for its actions. Accountability implies reporting, while marketing dashboards serve as its vehicle. Accountability has a computational aspect and covers a range of marketing capabilities, processes, and metrics. There are a number of possible marketing metric categories.
One such metrics category is marketing effectiveness, which measures the ability of marketing to produce a specific result. Another common and separate metric category is marketing efficiency. Being able to actually measure marketing effectiveness takes marketing measurement.
Marketing measurement is the act or process of measuring. Marketing measurement is essential to being able to perform marketing accountability.
These three terms are related, but not interchangeable. Each is an important aspect of marketing performance management. The whole point of performance management, marketing accountability and marketing measurement is to help marketing optimize its performance and achieve meaningful business results. The best way to approach marketing performance management, accountability and measurement is to see it as a continuous, process -one that can be repeated – which is designed to help you measure, analyze and learn so that you can make more informed decisions and successfully produce more and better predictable business outcomes.
Alignment: Key to Marketing Performance
Just as your car runs more smoothly and requires less energy to go faster and farther when the wheels are in perfect alignment, you perform better and your organization will be in sync when your marketing is in alignment with the business.
Alignment and accountability are the first steps every aspiring marketing organization must take to improve its performance management and measurement. Alignment and accountability are inextricably linked and are the cornerstones for transforming marketing into a center of excellence. Without alignment, it’s impossible to quantify the value of marketing to the business, and to select the right metrics — metrics that measure whether you are doing the right things to generate value for the organization.
The most sophisticated data collection and analysis can be completely undermined by a lack of proper alignment. Best-in-class marketing organizations create a direct line of sight between their marketing investments, activities and business outcomes. Alignment enables marketing to clarify the strategic intent of all the investments it makes, and to measure and communicate the degree to which marketing delivers on its commitments.
Defining alignment
Finding the correct path to proper alignment can be confusing at first. Marketing groups often take a bottom-up approach to planning, and focus on developing marketing programs that usually include some combination of what has always been done or what they know best. Programs may not seem tightly connected to the business. The metrics typically used at the program level do not always demonstrate the connection between the broader business initiatives. As a result, it is difficult to quantify marketing’s contribution to the business, and the picture is hazy. This jeopardizes continued investments in marketing and can obscure the steps it should — and should not — be taking.
An outcome-based approach to alignment flips this problem on its head — creating a top-down perspective, starting with the business’ success factors and working “down the ladder” to reveal what marketing can do to support the business.
Metrics and key performance indicators (KPIs) can then be established to directly tie what marketing is doing with the success of the business. When done correctly, alignment provides greater insight into how marketing is expected to make a difference and provides you with that essential roadmap.
Is your marketing organization aligned?
You will know that you have achieved proper alignment when:
1. Marketing projects are prioritized based on their value and impact to broader organizational outcomes; not on what has the most political capital, is easiest to do, or the furthest behind schedule.
2. There is a direct line of sight between investments (money and people), objectives, program strategy and tactics.
3. Each member of the marketing team understands their role and actions necessary to achieve the business outcomes.
4. It is clear who is accountable for enduring execution of initiatives, projects and tasks.
Select an approach
If you think you need to improve your alignment, then you will need an approach. There are many ways to address alignment. The most important consideration is to choose a method that will visually convey the connection between marketing activities and business results and provide insight into selecting outcome-based metrics.
Too many of the metrics used today tell whether the tactics being implemented are being done correctly. If that’s you, then the key step to take after alignment is to identify metrics that will help determine whether you are doing the right things. The alignment approach you take should help reveal these types of metrics.
Instead of telling colleagues how important alignment is, show them by using quantifiable data. By connecting alignment and accountability, you can focus on measuring and managing marketing’s performance in a way that truly demonstrates the ability of marketing to generate value — and its contribution to the organization.
7 Key Steps for Creating a Performance-Driven Marketing Organization
Members of the leadership team expect marketing to generate value for their organization. Why? For many organizations, over 80% of their value is derived from intangibles. These intangibles, such as marketplace position and customer relationships, are often produced by marketing initiatives and result from marketing investments. Therefore, it’s no surprise that the leadership team’s expectations and pressure on Marketing will continue to rise. Generating value requires marketing to help the organization capture market share, increase customer lifetime value and grow customer equity. It is essential that Marketing maps out a clear direction and, as we say in Texas, ‘Get ’er done’.
‘Getting it done’ takes performance management. While Marketing Performance Management and measurement is not new, the current business climate has increased the emphasis on marketing accountability and analytics. Joan Ritter wrote in The Technology Executive, huge leaps in technology, together with the instant gratification of real-time campaign measurement in Internet marketing, have converged to bring the issue of marketing accountability to the front page of the business section.
Even improvements in the economy will not diminish the C-Suites’ focus on marketing accountability, effectiveness and measurement.
Many marketing organizations, however, are not getting ’er done. For over ten years we’ve conducted a marketing performance management and measurement (MPM) study. The most recent results reveal that over the past decade, Marketing hasn’t made much progress in regards to performance measurement and management. In fact, 10% of the 446 respondents assessed their marketing organizations as completely ineffective (10.3 percent) in measuring marketing performance, compared to 12.5 percent choosing completely effective. Three in four respondents rated their organization’s effectiveness in measuring marketing performance as only somewhat or marginally effective. These results are very similar in terms of responses to this same question in previous years. We have found that Best-in-Class marketers stand out. They are better with statistical significance in their ability to align marketing with business outcomes and clearly convey their impact and contribution to the organization.
7 Easy Steps That Start Your Journey
Wondering which way to go next? Here are 7 easy steps to get you heading in the right direction on your journey;
- Alignment: Establish direct-line-of sight between Marketing initiatives and investments and business outcomes.
- Metrics: Create outcome-based metrics and maintain a metrics catalogue.
- Data: Leverage accurate, timely data. Develop a Data Dictionary and Data Source Inventory,
store this information in an accessible format, and update it regularly.
- Analytics: Hone your analytics skills so you can gain insights from your data and build
models.
- Performance Setting & Tracking: Commit to set outcome-based performance targets for
every program and track results.
- Dashboard: Produce an actionable marketing dashboard that quickly and visually conveys
your contribution to the organization and facilitates course adjustments.
- Refine It & Start Over: Keep in mind that continuous improvement takes a ’reiterative
process’; a test and learn culture. What you do today will feed back into the process in the
future. In this way we learn from each activity and adjust our future actions accordingly. Where to start on your journey? The very first step is to address the challenges of alignment and accountability. Addressing these two gaps requires Marketing to clarify the strategic intent of all the investments it makes on behalf of the companies it serves. Marketing accountability requires marketing professionals to have data, analysis, and measurement skills. They must be fact- driven. Both of these may require a significant cultural shift and changes in the personnel roster.
Improving and refining what you do today will change your results tomorrow. If you are not satisfied with the way things are, then change them. Consistent gathering and evaluation of information will lead you to better decisions and better results. Isn’t that really what it is all about?
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