(this is a guest post by Taylor Mitchell of our sister program for Sales executives, the Sales Executive Council. It originally appeared on their blog.)

A fundamental shift in customer buying behavior has created a rift where Sales and Marketing have traditionally engaged customers. This void in the purchase process where customers are free from supplier engagement, a “no-man’s land” so to speak, has several implications on what successful selling looks like in today’s environment, but one of the more immediate concerns is that most suppliers haven’t fully recognized the shift has even occurred

This lack of awareness could partly be blamed on the fact that there is significant internal confusion in supplier organizations over the ownership of certain commercial responsibilities. Data from the MLC’s Commercial Integration Diagnostic illustrates that companies don’t have a good sense of which function, Sales or Marketing, owns some of the most important commercial activities—almost 70% of the member companies surveyed were unsure of who owned the insight generation responsibility, for instance.

As such, many sales organizations lack the scalable organizational support reps need to successfully sell in today’s environment, and are therefore leaving individual reps to do much of the heavy lifting themselves.

What makes matters even more difficult for sellers, and sales organizations alike, is the fact that buyers are not contacting suppliers until they are, on average, 57% of the way through their purchase process —meaning they have already determined their needs, completed due diligence, and have even begun to do some comparison shopping.

Given that this emerging commercial rift or “no-man’s land” is essentially enabling customers to make purchase decisions without supplier influence, it is all the more important that suppliers alter their strategies to drive customer engagement at the earliest, most formative stages of a sale and shape customer demand.

The SEC is focusing on just this in our forthcoming 2012 research. Initial findings suggest that the best companies are developing an organizational capability spanning both marketing and sales to generate unique insight, develop scalable commercial messaging based of that insight, and to generate leads/select opportunities based on customer receptiveness to that insight. By doing so, these companies are able to successfully support their sellers in engaging customers early and shaping their demand.

What is your organization doing to tackle no-man’s land and increasing buyer sophistication? Does developing an organizational capability to generate unique insight and support sellers sound like the right approach to you?

Usually, when the customer has an issue, customer service is there to help. But in this case, the reps are often as confused as the customer. As a rep at a national retailer recently told me when I called, the personalized ad “is not on our site so it’s Pandora’s ad not ours”. With personalization being a relatively new and under-regulated phenomenon, the chance to be exactly right is often counter balanced by the chance to be completely wrong. Sophisticated algorithms running in the background don’t guarantee success – any financial firm can tell you that.

As marketers rightly understand it, personalization is on their turf. While they are positioned to take the lead in delivering greater relevance to consumers, marketers can’t hope to ace it on their own. Here’s why:

• Personalization calls for inter-departmental coordination. Your interactive marketing vendor isn’t the only party you’ve got to work with. Not letting your left hand know what the right is doing when it comes to targeting customers is inviting trouble. At the very least, sales and customer service need to know what personalization is and be able to give a informed explanation when customers call with questions/comments ranging from “Why am I seeing this?” to “Stop spamming me!” To consumers, anything with your logo on it is your ad and hence your responsibility to explain / fix / make disappear. Having a short, scripted FAQ beforehand on how personalized ads work and how settings can be adjusted could save reps from coming up with their own explanations. For sales, integrating the detailed customer data your use for personalization into the CRM system could help them gain valuable context before each conversation and more willing to track additional consumers metrics for you next time around. The simple fact is, if you don’t talk to other departments beforehand about what’s going on, they’ll come back to you later about what’s going wrong.

• Personalization calls for coordination within marketing itself. In the same vein, marketers involved in personalization shouldn’t be allowed to sit in their own niche while keeping the rest of the department in the dark. Digital and social marketers can tell you who is poking around on brand’s Facebook and campaign pages; product managers can help you zoom in on purchase motivation in a particular segment; and market research analysts have primary research and tracked metrics that would add another layer of do’s and don’ts.

Hippocrates said, “First, do no harm.” Embarrassed or annoyed consumers aren’t likely to be loyal – they said as much in our recently concluded consumer survey on personalization and privacy. The bottom line: consumer data can be bought but consumer trust cannot. We’ll talk more about how you can get personalization done right in your segment so stay tuned for more insight.

These factors are creating the “no-man’s land” facing Marketing and Sales, one that we told you about last summer in our annual B2B research project. But they’re also making Sales’ job harder by making the process more complex: when buyers have ideas in their head that they get from internet research, or when a committee makes a purchase, rather than an individual, complex contingencies quickly develop, ones that can be hard to manage for individual reps.

Johnson Controls, an industrial controls and facilities management company, sells complex products and solutions. Its reps ran into the problem described above, and had trouble making complex sales. The company’s solution was to embrace game elements to help reps unearth critical, unarticulated customer needs that aren’t being met effectively – and, in turn, reconcile competing priorities among multiple stakeholders.

Johnson Controls first gets all the stakeholders into a room and asks them to fill out two kinds of cards: “needs cards” represent key priorities for each participant in the buying process, and “practice cards” represent the organizational actions needed to meet the needs.

Cards are then mapped onto a special gameboard developed by Johnson Controls, that graphically represents where the customer thinks critical needs are going unmet. Armed with data and benchmarks from across the customer’s segment, reps can challenge customers in the moment by comparing them to competitors.

For more, including how Johnson Controls reps balance multiple priorities among stakeholders, check out the full case, or listen to this webinar replay to see how this and other companies have revamped their needs assessment process.

Payless, an American shoe retailer, faced this problem a few years back. Facing competitive threats from big-box discounters, a deteriorating customer experience, and a management team far-removed from the average customer, the company’s CMO tried to drive improvements in the customer experience but predictably failed due to lack of senior management buy-in.

Realizing that the company needed to make the lack of customer focus “real” to senior executives, Marketing arranges a series of executive-immersion sessions. They listen in on focus groups to learn the characteristics of core segments, then “act out” those segments in a series of visits to Payless and competitor stores – a constraint that forces them to remove their functional hats and view stores from the perspective of a consumer, rather than an operations or a finance executive.

A key part of the visits to Payless stores is that they are unannounced and incognito. Executives, assuming their roles as a particular customer persona, shop in the store as any other customer would, avoiding the problem of stores “preparing” for pre-announced visits.

The end result? Executives quickly figured out where the customer experience was lacking and identified a few key elements to fix, leading to higher same-store sales and increased foot traffic and customer satisfaction.

MLC members, check out the full case, or listen to this webinar replay on how companies – including Payless – have pioneered consistent, differenteated, and delightful customer experience.

While it’s looking like 2012 might be a better year for business than 2011, it’s still essential that marketers focus on ways to ferret out waste and inefficiency in operations – both to minimize the impact on corporate bottom lines, but also to remain flexible for the new channels and investments that are sure to pop up in the coming 12 months.

And so, we measure everything – campaign effectiveness, brand investments, even the internal operations of the marketing function. But a marketing organization is a complex organism, and can be measured in an infinite number of ways – ways that might be contradictory or misleading.

Unsurprisingly, MLC members have come up with a number of ways to measure marketing’s effectiveness. Here are a few of our most popular strategies:

Measure adherence to the brand promise. Large organizations face inherent difficulties in consistently delivering on ambitious brand promises, and FedEx was no different; performance to brand promise was wildly inconsistent across channels and geographies.

In response, the company created a scorecard that boiled down the brand promise into discrete employee behaviors, incenting the front line to comply in the process. MLC members, read the full case here.

Measure marketing’s contribution to firm financial performance. This one can be difficult to figure out – it’s hard to determine, with any sort of certainty, which marketing activities have led to which performance benchmarks at the corporate level.

Xerox moved to this model after years of throwing large volumes of performance data at senior decision-makers. They used a lean Six Sigma process to arrive at a manageable number of insightful metrics aligned with broader firm performance, leading to higher levels of senior-staff buy-in. MLC members, read the full case here.

Measure marketing’s contribution to firm goals. We highlighted this case in this week’s post on sustainable brand growth, but it also explains a key insight into what Marketing should prioritize when it comes to effectiveness measurement. Given the somewhat ambiguous nature of marketing, it’s key that senior folks buy in – and most often, getting buy-in is contingent upon answering the question “What have you done for me lately?”.

One MLC member solved this problem by creating a purpose-built dashboard that shows exactly how marketing and branding initiatives align with and contribute to corporate goals. MLC members can see the whole case here. We’ve also blogged about this case.

We thought we’d take you on a brief tour of four proven strategies for sustainable brand growth, as illustrated by MLC members:

Establish a repeatable brand-building framework. Think about it: a lot of dominant brands in various markets are dominant not necessarily because of planning and business acumen, but tradition and accidents of history.

American spirits manufacturer Brown-Forman, famous in particular for making Jack Daniels whiskey, arrived at a set of tools and processes to establish and build on a meaningful and differentiated brand position. MLC members, for more, click here.

Develop a marketing and brand plan that supports overall corporate strategy. It’s vitally important that your brand resonates with your actual consumers, yes. But almost as important is whether it resonates internally – if marketers can’t communicate their contribution to the corporate bottom line, it makes it pretty easy to cut a popular brand from the market.

One MLC member solved this problem by creating a purpose-built dashboard that shows exactly how marketing and branding initiatives align with and contribute to corporate goals. MLC members can see the whole case here. We’ve also blogged about this case.

Develop a clear, differentiated brand strategy. Many of our readers and members work for mature brands – ones that have been around for decades or centuries – and in the intervening years, brand promises and strategies can get muddled to the point of ineffectiveness.

Recognizing the problem, Clorox (which will be 100 years old next year) launched a study into what made brands consistently outperform their categories, and found that each had a single-minded growth strategy that all activities aligned with. They then created the HighFlyer program that helped brands find that growth strategy. MLC members can see the whole case here, our toolkit here, and we’ve blogged about it before, too.

Focus on consumer focus. Ultimately, we marketers are here because of customers and consumers, but the complexity of many firms’ business, our marketing plans often revolve around something else – the demands of television partners, for instance.

Kellogg’s, recognizing this, refocused its planning process to concentrate on measures of customer engagement and focus, leading to stronger, more sustainable brand growth. MLC members can see the whole case here or listen to a webinar replay.

Over the last few months, we’ve surveyed the membership a lot (thank you for helping us out, by the way). And those that we’ve talked to seem to agree on one big thing: 2012 is going to be a year of change. We explored a few things that might change last week.

But no matter what changes, it’ll be important that firms are ready for what’s coming around the bend. Marketing has a key role to play in driving change internally, and to get ready for what might be a tumultuous year, here are a few examples of how member companies have done just that:

International Truck and Engine’s Strategy Support Groups. New customer behaviors and market realities often make it necessary for companies to rapidly implement new strategies – but change fatigue is real, and traditional techniques don’t always create the atmosphere of high employee/manager engagement necessary to push changes through.

International’s marketing and communications teams came up with a novel approach: small “support groups”, designed to help managers internalize strategy and advocate for it with their staff.

Standard Chartered’s Brand Values Activation Team. Shifts in brand positioning are a particularly difficult form of internal change; employees internalize brand attributes even more than consumers do. Typically, companies try to drive internal adherence to new brand standards through centralized communications campaigns – but they believe that such a campaign wouldn’t engage employees well enough to drive new behaviors.

Similar to International Truck and Engine’s small-group oriented strategy, Standard Chartered created a “brand values actvation team” that culls enthusiastic, change-oriented managers from around the organization, and co-opts their passion to spread new standards to the rest of the firm.

Novelis’ Solutions Innovation Gameboard. As markets loosen up, and as recessionary habits begin to fade away, innovation will be a key element of re-capturing wallet share. But a lot of times, innovation efforts are poorly structured – and the result is incremental changes in product or service offerings, nothing that captures the market’s imagination.

Realizing that their traditional innovation process was freezing out the voices of lower-level employees, Novelis’ marketing department developed a game-based ideation session that creates an engaging setting for identifying, evaluating, and further developing a broad range of early-stage ideas from the entire employee base.

MLC members, want to learn more about Marketing’s role in organizational change? Check out our internal communications and NPD/innovation topic centers for the latest cases and studies on these topics.

At the end of last year we conducted a survey of 92 B2B marketers asking them to evaluate some of the big changes looming on the horizon.  From the list of 14 potential shifts threatening to rock marketers’ reality, five emerged as holding the greatest potential for impact on business results (from the survey takers’ perspective).  They were:

• Marketing’s primary focus will shift from traditional marketing activities (e.g. demand/lead generation, value proposition development, etc.) to enabling cross functional, end-to-end customer experience management among customer-facing departments.
• Marketing’s primary role will be product, service, and business model innovation, rather than traditional marketing activities (e.g. marcom, branding, segmentation, etc).
• Marketing’s role will be about producing customer information, as much as using information (e.g. campaigns will be designed to collect customer information, not just build awareness or generate leads).
• Customers will be significantly involved in customer-facing ideation activities (e.g., new product development, messaging) beyond episodic feedback solicitation.
• Marketing will be able to accurately predict customers’ purchasing needs and stage of the buying process early on, before Sales reps’ conversations with customers.

Marketers also evaluated how soon they expected the shifts and the top five had varying timelines associated with them – some marketers predicted would materialize within a year, whereas others were 3-5 years out.  Among these five, the shift from just using to producing content was seen as the most near term while the ability of marketers to predict purchasing needs was thought to be the furthest out.  But regardless of timeline, as these changes occur, what will they mean for B2B marketers?  Some thoughts:

• Marketing departments will not be organized by touch-point (i.e. tradeshow, web, direct), but rather by customer needs at least partly aligned to where customers are in the buying process.
• Marketing will work closely with IT to strategize, implement, and optimize the increasingly important and vital role of technology in day-to-day operations.
• Collaboration across the organization in service of true customer-centricity will be the norm and the best marketers will excel at internal politicking and influencing other stakeholders.
• Collection of customer voice will focus on understanding the context customers are operating within rather than their opinions with products/services/customer touch points.
• The ability to quickly understand and synthesize data (quantitative, qualitative, and in between) into a compelling story will be a requisite skill.
• Editorial calendars will be as important to marketing departments as strategic plans with content purposefully and precisely plotted out according to company strategic priorities.
• The number of “touches” between supplier and customer will decrease as the impact of each interaction increases.  The monthly e-newsletter will be a thing of the past, replaced by more targeted, relevant, and timely communications.
• Because Marketing will be able to prove the superiority of its lead gen and qualification efforts, Sales will accept and follow-up on qualified leads without incessant questions and complaints (okay, so maybe this is just something I think marketers hope is true…).

What else do you think the future holds for B2B marketers?  What are some of the big shifts you anticipate in 2012 and beyond?  Discuss in the comments below and/or email me to set up a conversation with the MLC B2B research team – we’d love to know what you are thinking about/working on/losing sleep over.

Give more than we take. Marketing’s job, at its most basic, is about a) gaining customer attention and b) converting that attention to dollars. The strategies for doing that vary, obviously – some firms opt for longer-term relationship and brand-building, deferring the attention to dollar conversion to a later date, while others choose shorter-term strategies.

Regardless, it’s worth remembering that that attention is as limited a resource as the money it leads to, and the best firms will do everything they can to extract the most value out of every minute of consumer brain time. For most, that will mean something that might be a bit revolutionary – positioning marketing efforts to add value to the life of the customer.

How to do it? Last year’s major research projects (B2B, B2C) suggested some examples of how big companies have made the buying decision easier and more valuable for customers.

Get empirical (well, as empirical as possible). “Data-driven marketing” is repeated so much by vendors and consultants that it’s nearly at the cliche level, but our initial impression of how large-enterprise marketing organizations use customer data is that there’s a lot of room to improve. In a number of organizations, we’re seeing that data is used mostly to give an empirical veneer to already-formed conclusions; that’s not what empiricism is about, to say the least.

Our best-practices research into this topic is ongoing, obviously, and subject to change. But one key area we think marketing organizations can pretty easily key in on is reducing the cost of being wrong. Why? Well, making fact-based decisions requires people willing to be proven wrong by data – the market is a complex place, and our assumptions about customer behavior, marcomm effectiveness, and any number of critical knowledge areas will sometimes – perhaps often – be wrong. If the stakes of being wrong aren’t quite as high, decision-makers will have more incentive to bring an open mind to customer data.

Forge better cross-functional connections. Critical to progressing on adding customer value and making the most out of data is an old Marketing bugaboo: forging effective relationships with other functions. For instance, making the best use of data requires an effective partnership with IT, at the very minimum, and incorporating added customer value into marketing activities likely requires us to play nice with customer service and R&D.

This is an old standby topic for MLC; for more, check out our cross-functional alignment topic center.

Get serious about establishing a truly global marketing organization. Most large enterprises have marketers around the world, but, judging from the best of the best, that’s not quite enough to call your marketing department “global” anymore. What’s needed, rather, is a focus on building out local marketing staffs and incorporating local practices and knowledge, to the extent possible and necessary.

Last year, we did a project on global marketing that lays out how some of the best companies are structuring their Marketing organizations to take advantage of all that a global footprint has to offer.

Do you have any marketing-related resolutions for the upcoming year? Let us know in comments.

Outside of the gameshow arena, consumers are arguably just as obsessed with price, and this attitude has become a pain point for many a sales representative.  How does a sales rep keep the conversation away from price when that’s all that a customer is thinking about?

Teach them something else that’s right.

Let’s look at a case on truck driver engagement and retention to see how Marketing at Volvo was able to deal with this issue.

Initially, no matter what sales reps went in with…

“We have a better product!  We have more features!  We can address your needs!”

… the customer always brought the conversation back to price.

“Well… a truck is a truck, but hey maybe you can throw in some free chrome bumpers!”

Volvo convened a small group of mid- to upper-level directors in a workshop to brainstorm and develop a new message for the sales reps.  MLC members, read more about the key elements to this workshop here.

They recognized an opportunity to improve driver management for their customers…

“Customers are underestimating how much unsatisfied drivers are costing them.”

… and crafted a pitch that teaches customers the value of Volvo solutions.

“Instead of telling them how our 2,092 square inch windshield will reduce the likelihood of an accident, let’s talk to them about the costs associated with driver turnover.”

Notice that instead of leading with the value of product features and focusing on known customer needs, the new approach leads with issue(s) costing customers money and telling them something they don’t already know about themselves.

And voila, you’ve shown your customers that the price is not the only thing that’s right when it comes to your business!

MLC members, read the full case study here.

While segmentation can be approached in many ways, some of MLC’s members have evolved best-in-class winning segmentation strategies that have propelled them to success. Presented below are a couple of strategies our members have used to segment their customers and consumers. The key take-away, as you read through these examples is that these are simple to enforce, yet innovatively different ways to segments your customers and consumers.

B2C Consumer Segmentation Examples:

LG Mobile’s Adaptive Customer Personas: Going over and above the conventional psychographic consumer segmentation, LG developed real life consumer personas at the work place. Employees could interact with the personas personally. Listen to LG’s M. Ehtisham Rabbani on how LG got it’s segmentation to stick with it’s employees.

La-Z-Boy’s In-store Diagnostic Protocol: Furniture retailer – La-Z-Boy developed distinct segments based on purchase motives of consumers, while in a retail store. It then equipped sales reps with a short two question diagnostic, which helped them map the customer, in-the-moment, into different purchase segments. The diagnostic also provides next-step recommendations to reps, to facilitate in-store interaction, leading to purchase.

B2B Customer Segmentation Examples:

Dow Chemicals’ Need-based Segmentation: Dow chemicals embarked on industry focused exercise to determine company-neutral loyalty drivers. However, instead of fitting drivers of loyalty within customer segments, Dow built its segments around them. This needs based segmentation enabled Dow to meet customers’ stated, and latent needs. By addressing previously unmet customer needs, and increased customer loyalty by 15%.

Square D’s Segment Selection Methodology: Square D (A Schneider Electric Division) defined valuable customer segments on two-criteria – opportunity” (long-term revenue potential) and “fit” (a comprehensive measure of a customer’s alignment with Square D’s strategy). The company allocated more marketing resources toward these key customers, who scored high on both the criteria. By carefully defining their customer segments, Square D was able to grow its key accounts by 54%, as opposed to 12% growth in other accounts.

MLC Members: You can find our extensive topical coverage on our Segmentation Topic Center. We have also assembled a Segmentation Pre-launch toolkit, which will help you to put in place the pre-requisites before launching a segmentation exercise.

That got me generally interested in the idea of marketing training – how do you teach a group of marketers, whose job is notoriously nuanced and imprecise, to do their jobs better? To see more of the market, and in a more detailed way?

In any case, it might turn out that training marketers to handle data better won’t make marketing organizations more fact-based – we’re not sure, and it’ll take a lot more interviews and thought on our part to figure out the challenges here. But I wanted to highlight some of our most popular training and development resources, just in case you’re on the same path. Here are a few steps to building a better marketer:

Identify the best training investments. Consumer products giant Unilever lacked a standardized way of evaluating their marketers’ performance across brands and geographies, and struggled to establish an objective view of overall skill level. The result was that they couldn’t figure out the highest-potential opportunities for upgrades to training and development.

Their answer to the problem was to develop a Marketing Capabilities Audit, which measured the performance of each fundamental marketing capability on the brand level, which in turn determines where the company spends its dollars on capability improvement. MLC members, click through to see what Unilever checked for in their auditing process.

Target skill gaps through tailored criteria. Most brands and companies have one or two key areas where teams, for whatever reason, don’t measure up. Microsoft tried to tackle this by simply offering more L&D opportunities – courses, webinars, that sort of thing – but the result was confusion: managers and employees didn’t know which courses were relevant for them.

In response, the company’s marketing leaders conducted a gap analysis that assessed where teams were in key skill areas versus where they should be, and embedded those areas of most needed skill improvement into curriculum documents that guide marketers through the company’s course offerings.

Embed training into marketers’ workflows. 3M, like a lot of manufacturing companies, has shifted gears over the past few years and is moving from a focus on developing superior products, to a focus on meeting customers’ holistic needs. That’s a shift that requires pretty serious lift on Marketing’s part, but the company wasn’t sure that Marketing’s existing skillset could meet the needs of a solutions-oriented company.

3M dispensed with traditional marketing training methods, and instead built a training curriculum that directly supported their business goals, working with leading academics. The result were training modules that were customized to key points of demand – such as seasonal goals or duties – increasing uptake among staff.

Have you had success with an unorthodox training solution? Let us know in the comments.

Marketing at Kimberly-Clark found a way to generate more effective communications by making principled shifts in media spend.  The secret?  Rather than beginning with mass media and then making other investments if budget allows, they plan media touchpoints outward from the consumer first.

Kimberly-Clark begins by identifying a clear overarching creative concept called an “Engagement Idea” that drives touchpoint selection.  A well-developed Engagement Idea also provides necessary support and rationale for initial budget allocation into nontraditional media channels.  It develops the “Engagement Idea” through four steps:

1. Understand the brand – Ensure comprehensive knowledge of the brand’s positioning and the consumer-centric rationale behind it.
2. Brainstorm ways to drive engagement around the brand– Use consumer feedback to find potentially resonant ways to represent the brand.
3. Screen potential ideas for flexibility – Test the Engagement Idea for flexibility (i.e. it can last for two to three years’ worth of campaigns) and breadth (i.e. it doesn’t directly prescribe specific touchpoints)
4. Identify touchpoint roles – Determine which touchpoints are best suited to conveying the Engagement Idea as well as any others needed to drive people towards those touchpoints.

To get Marketing to accept this new approach and the ideas produced, Marketing also takes an aggressive sales approach to convince internal audiences to accept nontraditional touchpoint mixes.

In Jack Johnson’s first US hit, he sang “I want to turn the whole thing upside down… I’ll find the things they say just can’t be found.”  Turn your media planning upside-down, and maybe you’ll find a more efficient media mix.

MLC members, read more about this process here.

By Chris Frank, a former marketer at Microsoft and the author of a new book on decision making.

We have become a world of data addicts. But with more data comes the feeling of, “How do I make sense of all this? Can’t we break this down into a handful of simple points?” Critical questions about market demand, customer buying behavior, subscriber acquisition, brand positioning and your product’s roadmap are great. However, the interesting discussion comes to a screeching halt when the data arrives. Instead of being a well-arranged piece of music, it is a mash-up of sounds. The volume drowns the substance.

Data Rehab

Information is essential to making intelligent decisions, but more often than not, it simply overwhelms us. The 24/7 data explosion around us is both troubling and addictive. Consider that this year, The Economist estimates we will create 1,200 exabytes of data or more than 22 million times the amount of information contained in all the books ever written. That’s eight times the amount in 2005 and the annual volume is increasing geometrically.  The question isn’t how to stop the deluge, but how to get real value from it. How do you find the truly essential nuggets of information and use them with confidence to effectively grow your business and distinguish yourself in your company?

The answer, ironically enough, is found in asking questions. The smartest person in the room is the one that knows the questions to ask to separate the wheat from the chaff. This leads to discovering relevant facts, developing insights and delivering them with impact. Adapted from a new book, “Drinking From the Fire Hose”, below are three questions to ask yourself whenever you are suffering from information overload:

Ask “What Surprised You?” to Foster Dialgoue

The key is to foster real dialogue, so try asking your colleagues, “What surprised you?” At first you may not get a response but press the point and wait for new information to surface. Why? Because surprises are bias killers. Surprises make people think differently. This question will spur new discussion, uncover fresh learning and lead to new insights that separate meaningless facts from relevant information. The question exposes outliers in the data, draws connections between seemingly unrelated conclusions and opens different avenues of discussion with your colleagues. We must get in the habit of looking for things we don’t expect.

Ask “Should You Believe the Squiggly Line?” to Counter Short-term Thinking

Short-term thinking can be fatal to businesses, especially those focused on quarterly reporting. Relying on short-term data is not just misleading – it also robs you and your business of the continuity and equilibrium on which long- term success depends. The most effective way to discuss results is to consider just three factors: the absolute score, or today’s numbers; the competitive score, which is how your company is doing relevant to its competitors; and the score over time, or how you are faring against your competitors over the long-term.  By triangulating these three easily measured data points, you can gain almost all the perspective you’ll need and ensure that you don’t get hung up on short-term thinking.

Ask “Who are Our Swing Voters?” to Revive the Customer Conversation

Successful businesses generate additional revenue without incurring new marketing cost. This simple but powerful maxim is the key to driving profitable growth. It is important to know this and figure out how to apply it to your business. Popular wisdom states that neutral customers do not matter. Businesses typically focus on the extremely satisfied customers, yielding no new revenue or critics who’ll never switch to your brand. Yet, winning the neutral customer – or swing voter –  can be the most cost-effective method for driving growth.

Whenever you feel yourself getting lost in the data, consider asking smarter questions to reveal better answers, and be the catalyst that changes the dialogue in your company and with your customers.

For the full details on each question and how to apply them to your business, check out www.firehosethebook.com.

Christopher Frank is the co-author of Drinking from the Fire Hose: Making Smarter Decisions Without Drowning in Information (Portfolio/Penguin, September 2011). He previously spent 10 years at Microsoft as senior director of corporate research, worked at Accenture as a consultant in the consumer and technology practices, and founded an online start-up called Drei Tauben Ltd.  @chris_j_frank

Here are the big four headline trends for spend this year:

Marketing budgets are projected to increase in 2012. Our survey suggests that B2B budgets are likely to increase in all segments. Budget growth is expected to be much more robust in B2B services organizations than with B2B manufacturing.

This is a continuation of a pretty long-term trend. B2B marketing is still maturing, and I wouldn’t be surprised to see budgets continue to rise for the foreseeable future (barring the very real possibility of a renewed recession). With margins higher in the services space, its not surprising to see marketing spend rising faster, either.

What is interesting, though, is that marketers are increasing program spend faster than people spend – which likely represents the increasing importance of digital, analytics, and marketing automation. The embedded assumption is that human expertise is, on the whole, less important – an assumption that we’ll see tested, I think, in the coming years.

Budget allocation for digital is increasing. This shouldn’t be surprising to any Interestingly, while budgets on the whole are set to grow more slowly in the B2B services space than in manufacturing, digital spend should increase significantly in manufacturing. Part of this, I think, is catch-up growth, but it speaks to how manufacturing marketers are embracing non-traditional sales and marketing techniques.

One interesting thing will be to see how vendors will adjust their strategies for the B2B manufacturing market, which does not at all match the core competencies those companies have developed for the consumer market.

Budget for traditional marcom activities and direct marketing is decreasing. Our survey suggests that spend on traditional marcom activities has decreased between 15% and 23%, and spend on direct marketing has dropped between 15% and 17% from 2010 to 2012.

Part of this is a necessary corollary to increases in spend on digital, but it appears that part is a genuine shift in tactics. Budget cuts in the late aughts, we think, led marketers to experiment more with virtual events – webinars and the like – which proved effective and have gradually replaced spending on live events, which are much more expensive.

Marketers are cutting back on sales support activities, and shifting spend to marketing automation. We’ll have more on marketing automation and analytics  in a few weeks (get excited!), but for the meantime, the big takeaway from this report is that spend in this category is increasing fast. B2B services organizations have increased spend by 45% on the suite of marketing automation technologies, while manufacturers have upped their budgets by 25%.

It seems like there’s some room for caution here, as big increases in spend and complex, not well understood technologies can sometimes equal vendors on the prowl.

Facing a mismatch between internal processes and the things they had learned from their customers, health care products company Cardinal Health had to do just that. Looking at sales data, the company’s marketers realized that customers – seeking to dampen costs and not seeing the value in Cardinal Health’s complete offering – often purchased one element of what was intended to be an integrative solutions deal. Not good!

The company realized that the problem wasn’t with the customers, it was with them – while they had some insight into their customers, they weren’t baking it into key internal processes, like new product development. The result was that their solutions offers didn’t resonate with their intended targets.

To fix it, Marketing developed a cross-silo innovation framework, designed to do a few things:

1. Get consumer insights from around functional silos on one page. Marketing divided internal stakeholders into three teams, and asked them to get in the heads of their customers and think about deep-seated marketplace beliefs, Cardinal Health’s key areas of competency, and their customers’ desired outcomes.
2. Identify the best opportunities. The teams then meet together, and develop links between the beliefs, desired outcomes, and areas that Cardinal Health can help.
3. Define the business concept. The ideas from stage 3 are then advanced through successive levels of scrutiny.

Want to learn more about Cardinal Health’s process? MLC members can read the case here, or listen to a webinar where we talk through this solution, as well as another from IBM.

That’s one of the questions Sales is asking itself, as recessionary habits persist in the buying centers of big organizations. The dynamics of internal buying centers are too complicated to be solved with a single solution, but one way Marketing can help is to make sure those buyers that love you – the ones still receptive to “relationship selling” – are equipped to make the case around the organization.

That’s exactly what Iron Mountain, the document management company, did when presented with a similar problem. They noted that typical Iron Mountain buyers – typically too junior to engage in strategic-level relationships – faced three obstacles that stood in the way of advocating for their solutions internally:

• Lack of appreciation for the strategic relationship. The company’s advocates loved the way Iron Mountain served their needs, but didn’t understand the broader, more strategic ways Iron Mountain could help their business.
• Minimal personal gain for advocates. Simply put, what’s in it for them?
• Fear of risking personal reputation. Potential advocates were wary – and who wouldn’t be – of sharing sharing overly-commercial resources and information with senior stakeholders, and secondarily were concerned about bringing a commercial proposal in front of decision-makers without a holistic understanding of Iron Mountain’s offering.

To teach these buyers how to advocate for Iron Mountain to senior staff, and leverage the company’s insights to raise their own profile at work, Marketing designs materials to do three things:

• Engage the heart. Iron Mountain highlights links between the advocate’s job, the solutions offer, and the value at stake for the broader organization. Doing this sells the advocate on pitching the solution internally.
• Motivate the mind. To get the advocate over the hump of pitching the solution internally, Marketing designs materials to reveal similarities between the advocate’s document management challenges and the pain points of senior decision-makers. This helps the advocate make a credible case to those stakeholders.
• Equip the hands. Finally, Marketing creates tools that the advocate can use to actually make the case to peers and senior leadership.

Want to learn more about Iron Mountain’s process, including the tools they armed their advocates with to make the case internally? You can read the full case here, or listen to Laura McDaniel, Iron Mountain’s director of marketing, talk through the approach.

It seems clear that, for a variety of reasons, energy and resource constraints will continue to be key concerns for small business owners for the foreseeable future. Those constraints take a few forms – sometimes they’re around environmental concerns, other times they’re around cost. But what language should you speak to business owners concerned about energy costs?

We know that green marketing can be effective in the B2C world, but how influential are environmental sustainability and corporate social responsibility on small businesses’ purchase behavior? This year, the Enterprise Council on Small Business tested the impact of a myriad of factors on small business owners. As it turns out, value alignment – such as on green – has only moderate influence on owners.

Source: ECSB Research, July 2011, n=1099 N.A.

So, if green marketing isn’t an effective way to reach small businesses, what is? ECSB recommends positioning how members’ products and services can alleviate business owners’ pain points. In a recent study, ECSB asked owners what their biggest pain points are in all areas of managing their businesses. In the area of building and office administration, the cost of utilities ranked highest – despite the majority of owners not anticipating price increases for 2012.

At the end of the day, messaging how your products and services can positively impact the bottom line is likely to be more effective than green marketing per se in targeting small businesses. So, rather than focusing on going green, show business owners how your company can help them save some green.

Which brings up the question – how can B2B companies better understand and serve their customers? We’ve gathered some of MLC’s research over time to help marketers identify what their customers want. The following will help marketers gain an insight into their customers’ mind:

Identify Customer Jobs and Outcomes: The customer world is made of a number of units of work flow – the jobs. Customers have a desired outcome for each job. Leading marketers, such as Reynolds and Reynolds (R&R), identify customers’ desired outcomes that provide R&R with a clear and unambiguous view of how customers measure value, enabling the company to align organizational resources behind a small number of new ideas. R&R’s exceptional understanding of each segment’s needs fueled innovation, and sparked a sevenfold increase in the number of new concepts selected for development funding.

Qualify Your Customer: Consumers needs evolve over the purchase cycle, as they figure out what they really want to purchase. Marketers, who track customers on their purchase path can understand evolving customer needs better, and design more relevant offerings when the final purchase decision is due. Telus qualifies its customers using an online community, and ensures a tailored interaction through their purchase path.

Let Them Do The Talking: When customers talk, they don’t just talk – their words often have hidden clues about their needs. Progressive companies use various touchpoints used by their customers to discuss their jobs, to understand the desired outcomes better. MLC Members can access a text or video version of the Customer Jobs TouchPoint Assesment at Texas instrument to gain deeper insight into the practice.

Integrate Sales Force Knowledge: This might sound basic, but many companies are yet to fully utilize the benefits of using the knowledge their sales force has about their customers. Companies can leverage CRM systems or consider marketing automation to know more about their customers, and have a more targeted conversation.

Join us for a webinar to learn more about the keys to marketing automation success (including the challenges to expect and pitfalls to avoid) based on our research, including a survey of over 150 marketers and conversations with top vendors and marketing automation consultants.

MLC members can access our topic center on customer understanding for in-depth guidance on understanding customers better from companies such as 3M, General Electric , Johnsons Controls, Motorola, etc.

Never again an unwanted dish!

The most dangerous assumption in relationship marketing:

Most consumers are open to entering a relationship with my brand.

They aren’t.

There’s a growing body of evidence suggesting that, at most, somewhere between 20% and 30% of consumers are willing to engage in a “relationship” with a brand.   The vast majority of consumers simply aren’t wired to enter into brand relationships.

When we asked 7,000 consumers via a global survey earlier this year whether they have a relationship with any brands, only 23% said yes.  The rest said “no”, and when we gave them an opportunity to elaborate on their response in a free-text field, we got lots of comments like “It’s just a brand, not a member of my family.”

We also saw this in an IBM study looking at the reasons consumers follow brands in social media.  Approximately 65% of business and marketing professionals believe consumers follow their brands to “feel connected” or “be part of a community”.  Both of these are relationship-y sorts of desires.  However, only 20 to 30% of consumers said those are reasons they follow brands on social media.  Very consistent with our own 23% finding.  And it underscores the disconnect between marketers and consumers on relationship dynamics.

Just last week, I came across a very interesting report from L2 (www.l2thinktank.com) about digital savviness in the specialty retail category.  L2 did a clever analysis looking 60 specialty retailers, and the correlation between Facebook interaction rates and size of brand Facebook following.  The clear pattern is a decline in interaction rates as communities grow larger.  In communities of 20,000 consumers or fewer, interaction rates are 32 basis points (yes, that’s 32 interactions for every 10,000 people).  For communities of 50,000 or more, the interaction rate drops to 7 basis points.

One possible interpretation of this finding is that brands aren’t doing a very good job of deepening relationships with new Facebook fans. So, it stands to reason: if only brands could innovate in their relationship marketing, they could drive much higher interaction rates. Right?

But what if there’s a different way of looking at it? Maybe there are natural limits to the number of consumers who will engage in any sort of relationship with brands.  Brands tend to pick up those fans first when they launch Facebook pages.  Once they pluck the low-hanging fan fruit, they hit a threshold at which most incremental fans are just in it for some transactional advantage, like a shot at winning a contest, or discounts.

So, maybe brands are simply unlikely to ever convert a meaningful share of those second wave consumers to have a relationship. But why not?  Why shouldn’t brands be able to build relationships with 35% or even 50% of their consumer base?

I believe it’s because there are deeper, genetic factors at play for a huge swathe of the consumer population.  In my next blog post, I’ll highlight some of the research I’ve seen that points in that direction.

In the meantime, it’s time to take a hard look at your relationship marketing efforts.  Try to find a splitter question to discern which consumers are unlikely ever to be open to a relationship.  And then stop wasting marketing blood and treasure by giving those consumers the “relationship treatment”.  Instead, treat them to a dose of decision simplicity, as detailed in MLC’s work on simplifying purchase decisions.