By Ana Lapter

A deepening debt crisis in Europe is making “austerity” the word du jour. To avoid budget cuts, many executives are under increasing pressure to demonstrate the ROI on marketing expenditure.  Historically, this was never an easy thing to demonstrate; many marketing activities are designed to build brand awareness or engage customers, things that are hard to quantify in a strict ROI framework.  But continued economic softness heightens the need to increase marketing productivity – the amount of value we get for the work we do.

How can a marketing organization become more productive while avoiding unnecessary costs?

The easiest approach is to cut staff and expect the remaining employees to do more with less. This, however, is not a good solution from the perspective of staff engagement and retention.  As one MLC member put it: “We’ve freed up a lot of money by streamlining staffing expenses already; there’s nothing left to gain from further cutting.” In addition, hiring has become a difficult proposition. In fact, many organizations design hard-to-fill-jobs that require an individual to master multiple skill sets that were traditionally split among multiple employees or were built in- house via extensive training programs.

Redefining marketing productivity in this recessionary climate calls for different actions. Here are three ways to boost productivity – without cutting staff:

Select better metrics. As one member noted: “We need to stop reporting how a recent ad campaign increased our brand’s reach X%, and, therefore, enhanced our brand’s visibility – and rather,take a P&L approach to metrics design.” In cases where ROI measurements are not available, I recommend the use of attitudinal or behavioral “bridge” metrics, rather than “volume”-centered, generic indicators, such as number of brand followers, Facebook fans, web visitors, page clicks through etc. Marketing should start using more intermediate metrics to measure the impact of specific activities that drive or connect the dots with a commercial outcome, such as NPS, loyalty or purchase outcome. The benefit of using a bridge metric approach is double-fold: it builds business buy-in and helps de-emphasizing low-value activities.

Build skills internally. One member explained that Marketing needs more MBAs or other hard-core business staff, but I personally believe (and a good deal of evidence supports) that a better approach is to look for people with general business sense or instinct, rather than financial skills or specific terrain knowledge.  Another way is to start building business acumen inside the organization by promoting job rotations across functions, creating templates for business cases, and designing light training programs, (e.g. Finance for non-Finance).

Integrate Marketing more tightly into the rest of the firm. Integration can be done at multiple levels:

• Strategy: One classic MLC best practice illustrates how to analyze desired marketing contribution to firm strategy.
• Process: Given the multitude of customer touchpoints across an organization, Marketing should reach across the aisle and improve end-to-end, firm-wide processes like customer experience, demand management, customer communication and customer insight generation. Some members enable these processes by creating new roles (e.g. Chief Information Officer and Chief Customer Officer) or by designing cross-functional governance bodies.
• Incentives and roles:  For instance, one member drove better alignment between Sales and Marketing by bringing both teams to agree on a simple definition of “lead” and measuring each function’s role in lead generation activities.  Another example is to recalibrate Marketing’s long-term focus on segmentation and brand affinity goals with Sales’ short-term revenue focus by creating a common denominator centered around customer engagement and functional contribution to brand revenue.

Increasing productivity in touch economic times shouldn’t start with painful staff cost cutting measures, but rather with intelligent selection of and over-investment in value-added activities and cross functional partnerships.

Marketing plans are often 20 to 100 page documents that cover every team’s goals and strategies, from the promotions team to the social media team.   Though comprehensive, these longwinded plans are too confusing to help individuals understand how their goals align with those of the broader organization.  Without alignment, marketers cannot create results, even when all the right elements are in place.

To tackle this problem, Marketing at MasterCard ruthlessly streamlined its annual marketing plan to one single page – the “Plan on a Page.”  MLC members, see an example of a completed Plan on a Page here or download this customizable marketing plan template.

Keep it sweet and simple.

We took a look at how MasterCard built their “Plan on a Page.”  A sampling of the Plan’s key traits:

Simplicity –the single-page rule limits the plan to the few goals that matter most.

Clarity – the plan links day-to-day tactics to high-level strategies (to help marketers understand how to achieve strategic goals).

Measurability – each goal, strategy, and tactic is tied to a clear measure of success.

The “Plan on a Page” not only saves planning time but also improves cross-functional understanding and alignment around strategic goals.  It also lends legitimacy and discipline to the marketing division, which is great because 73% of CEOs say marketers lack credibility!

All of that makes this simple marketing plan pretty sweet.

MLC members, read more about how a “Plan on a Page” can help marketing deliver greater bottom-line value.

Coaches and planners go into intensely competitive situations (football stadiums and market economies, respectively), lead teams with certain strengths, certain weaknesses, and a limited ability to change those things, adapt a “game plan” without knowing much about how the other side will react, and end up being judged on things that may or may not be their responsibility. They have to be meticulous enough to draw up most of the game in advance, but flexible and agile enough to call new plays should conditions warrant them. Most of all, they have to have the ability to get everyone on the same page, and motivate and marshal their teams to execute on the plan.

Football teaches, I think, 3 big things to marketing planners and managers:

Make a game plan, but keep it flexible. Football is an enormously complicated game; so complicated that, without a mental heuristic like a game plan, coaches would spend most of their time flipping through three-inch playbooks and inevitably make a lot of mistakes. But game plans are rough outlines of what the game should look like from one team’s side, and if a coach sees an opportunity on the field, it would be nuts not to depart from the game plan and call a play designed to exploit whatever opening the defense is giving him.

So too, with marketing planning: the number of touchpoints and channels our teams manage are orders of magnitude more complicated than they once were. So we plan to take some of the complexity out of our jobs. But if a market opportunity arises that the plan doesn’t account for, marketers must be willing to change things up.

If its possible, outsource. In the NFL, there’s a whole continuum of coach control. Some coaches call every play, offense and defense, themselves; others outsource play-calling to their assistants or coordinators; still others allow their quarterbacks to call plays at the line of scrimmage. But coaches who call their own plays have a notoriously poor record in the modern NFL – the complexity of the game has gotten to the point that those who try to do it all themselves usually fail. Teams that are consistently good in the NFL very often have play-calling authority vested in a number of places across the staff and the team.

For marketing leaders lucky enough to have well-developed teams, outsourcing decision-making processes is a powerful way of simplifying the world and freeing up your energy to focusing on strategic concerns and emerging trends. And for globally-focused organizations, relying on on-the-ground knowledge can be a way of getting better returns, too.

Don’t let risk-aversion affect the score. Here’s one where football coaches don’t do too well: they consistently allow risk aversion and poor risk assessment skills get in the way of what could be an extra victory or so per year. How? They don’t go for it enough on 4th down. David Romer, an economist at the University of California, studied every NFL 4th down across nearly 700 games. What he found was that coaches should typically attempt a 4th down conversion much more than they actually do; if 4th down conversions were maximized, an individual coach could potentially win about one extra game per year – and in a 16-game season, that can mean the difference between hanging up the cleats in December and going onto the postseason.

Why don’t coaches do more with their 4th downs? It can be chalked up to one of two reasons: either coaches aren’t accurately assessing the risk – they think going for it is riskier than the points they give up by kicking a field goal or punting – or, they accurately assess the risks, but are concerned about taking the blame if the call goes wrong.

The lesson for marketers? Take a hard look at areas in your “game” where you’re making risk-based decisions, and try to get an empirical basis for those decisions going forward.

MLC members, have anything to add? Let us know in comments.

MLC’s collection of best practices in marketing planning all have one thing in common: reducing complexity.  These best practices all involve stakeholders from outside Marketing, keep detail to a minimum, and make evaluation metrics explicit.

For more, check out our insights on Avoiding the Pitfalls of Marketing Planning.

Step 1: De-silo the planning process. Effective marketing planning processes involve stakeholders and points of view from around the organization. There are two key ways to do this:

-First, link marketing’s goals to broader corporate goals.  MLC members, see how Tesco embeds corporate priorities into its annual marketing plans.

-Second, interview senior leaders in other functions and get their view on plans and metrics.  MLC members, see an internal stakeholder interview guide inspired by Xerox.

Step 2: Simplify the inputs and the outputs. Colleagues outside of marketing suffer from information overload and are relatively unfamiliar with marketing-centric metrics. To get their buy-in for Marketing goals, plans must be extremely simple. MLC members, view MasterCard’s “Plan on a Page”, a concise marketing plan that is easy for external stakeholders to digest and understand.

Step 3: Make metrics clear; embed accountability. A recent study found that 73% of CEOs say marketers lack credibility because they fail to quantify the success of campaigns. To get the organization to buy into plans, marketing must clear metrics for success. MLC members, see a list of the most popular metrics for establishing Marketing’s effectiveness here.

MLC members, for more tools, tips, and case studies on marketing planning, please see MLC’s planning resource center.

Having worked in the restaurant industry, I can tell you that most bars and restaurants have a staffing plan that basically calls for more staff when there’s more likelihood of high demand. Depending on the place, restaurants staff up for weekends, happy hours, Mother’s Day, Christmas – the list goes on. But I doubt there’s a single restaurant on earth ready for that kind of foot traffic at 2:00 PM on a Tuesday.

Now, we can’t fault a restaurant for not guessing – or even having the capacity to handle – the inevitable surge of office workers evacuated after the second-strongest earthquake in the history of the East Coast. After all, with limited resources and the vanishingly-tiny likelihood of an unexpected surge in customers at that hour of the day, it would be uneconomic to have extra bartenders and waiters on hand.

But the bigger your organization is, the more products you sell, and the larger your geographic footprint is, the greater the likelihood of some kind of unexpected exogenous shock – whether the literal one we experienced in the DC area today, or something as innocuous as a rap lyric that mentions your product – can present an opportunity to serve more customers, strengthen your brand, or gain market share. And here’s the thing about shocks: they very often present an opportunity for breakout growth, as opposed to the more mundane linear variety – just look at the interest in Moscato before and after the rap lyric that brought it to renewed fame.

To me, shocks help explain why a lot of what marketers go through in the planning process is silly, wasteful and even dangerous. Geologists can’t predict earthquakes, weathermen don’t do terribly well with the weather, and marketers and executives aren’t going to be able to truly, repeatably identify and prepare for the kinds of shocks that can deliver huge returns to a brand – and that makes planning, at least as its traditionally done, an exercise out of touch with the real, unpredictable world.

So what can you do to prepare for earthquakes, literal and metaphorical? First, build agility into your organization and processes – my colleague Ana actually wrote about that very thing this week. Invest in staff – like our New Media Ringmaster – with proven records of accelerating organizational responsiveness; they won’t help you predict the future, but they’ll make you a whole lot better at reacting to the present as it happens. Consider strengthening your social listening capabilities; these can help you pick up on trends before they hit the mainstream. As you plan, keep it simple: members love Mastercard’s Plan on a Page for a reason. Most of all, stay loose and ready to tackle opportunities as they come – even if they aren’t “in the plan”.

MLC members, for more on marketing planning, please visit our topic center, and consider registering for our upcoming webinar on Agent-Based Modeling – one tool that can help remove some of the uncertainty around the future.

By Ana Lapter

Dealing with the future is a difficult task by nature, but this year’s planning process is further complicated by the tremendously uncertain global economy.  Recession fears, slow economic growth, lower consumer spending, feeble employment rates and depressed housing markets across much of the developed world are some of the factors that are weighing on executives, adding a new layer of volatility to any strategic planning exercise.

Uncertainty was the main modus operandi for marketers during the 2007-2009 recession. But even though the recession is technically over, recent stock market swings exemplify the uncertainty that is quickly becoming part of the new norm.  From a strategic planning perspective, dealing with uncertainty means allocating resources for two critical human capital capabilities: organizational flexibility to cope with unexpected challenges and opportunities, and change management.

To cope with uncertainty, a great human capital strategy should consider the following ten principles:

1. Build a portfolio of alternative capabilities or options to choose from in case the unforeseen happens, and embed these alternatives in the current operational structure using different assignments, different avenues for executing projects, experimentation, etc.
2. Deemphasize top-down control mechanisms and rigid processes and encourage employee participation, particularly with respect to actions and decisions that are closer to the point of market contact.
3. Adopt a more customer-focused approach by encouraging customer involvement and boosting the role and prominence of market research in decision making.
4. Promote a culture of continuous learning and doing, beyond the scope and boundaries of current projects and development programs, by building on-the job development programs, introducing rotation programs inside and outside the marketing function and assigning dual roles to individuals.
5. Place a premium on differentiating between signal and noise by investing in superior data gathering, advanced analytics and data mining for pattern identification and aggregated analysis of unstructured and structured data.
6. Encourage thinking beyond a specific campaign or project and focus planning and execution on integrative components to assess the magnitude of change and avoid “breaking points”.
7. Leverage a variety of team structures and concepts, including “just-in-time”, global, mixed, and “virtual” teams.
8. Foster a working environment that encourages the emergence of innovative ideas at every level of the organization through incentives, recognition, recruiting and developing entrepreneurial behaviors.
9. Invest in personal leadership and transparency to communicate and drive organizational buy-in for change.
10. Build strong “sensing” mechanisms and capabilities to identify emerging threats and opportunities by investing in competitive intelligence, demand mapping and social listening skills.

Here at MLC, we’ve just launched new research into talent, and we’re asking ourselves and members: what are the essential Marketing competencies – both individual and organizational – of 2015?  While we are still in the early stage of the research process, we are currently exploring the combination of organizational and human strategies that are most likely to guide marketing organizations, as new competitive environments and different economic challenges emerge.

Please contact me at abostan@executiveboard.com if you want to share your thoughts about the marketing talent of the future.

Why the sudden volatility?  Consumers haven’t suddenly changed spending behaviors, nor have business customers. And suppliers look healthier than in some time, beating earnings estimates and sitting on plenty of cash. Credit availability has drastically improved. Inflation is hardly threatening.

The answer seems to lie in the health of developed economies. While many appeared to be on the mend for the past year (albeit slowly), it’s become clear the recovery is far more fragile than was thought, especially in the US.  We’re not in a recession, but we’re also not in a recovery that is self-sustaining.

In such an unstable place, most signals (economic data) are too weak or confusing for investors to proceed with confidence.  Even small pieces of information have outsized impact and prices gyrate.  Markets, after all, are just groups of people trying to discern future value and in this case they are struggling.

So, what are executives doing in the face of this volatility?  Some are being tougher on discretionary spending.  Many are revisiting assumptions for 2012 planning.  But the executives we’ve spoken with are not deviating from the strategies and tactics they put in place following the recession.

There is one thing all executives should be doing right now – getting used to operating in an uncertain environment.  Fortunately, that doesn’t require telling the future.  It does require, however, a structured exploration of what could be, and flexibility to respond regardless what becomes.

Most companies can stand to improve in this area.  Want to learn more? Join your peers in our upcoming webinar, Taming Uncertainty, on 25 August at 11:00 am EDT.  We’ll clarify why volatility has become “normal” and how the best companies are working around it.

One of the coolest parts of this year’s research into consumer process was getting to speak with a number of vendors and companies that do just that, using a process called agent-based modeling. Agent-based models are mathematically-created worlds populated by mathematically-created people, who are then exposed to a certain stimulus. In marketing, that stimulus is usually a message or marcom effort; other disciplines use diseases or changes in the economy.

The end result is a plausible estimate of the effects of a marketing campaign on a customer base – something that can be used to test proposed marketing plans to see which delivers the highest returns. For B2Cs, the “agents” can be consumers, for B2Bs, agent-based models can estimate the effect of marketing campaigns on corporate buying centers and within broad discipline areas.

MLC members, to learn how agent-based modeling works in marketing planning, please visit the members-only insight page we’ve put together on the subject, and register for our September 15 webinar, featuring MLC researchers and ThinkVine, a vendor in the modeling space.

In the highly matrixed, geographically dispersed marketing world that many of us operate in, ensuring that a brand’s positioning is consistent across a multitude of stakeholders and geographies is a significant challenge. Too often the positioning suffers from a “lost in translation” problem as it transitions from one functional owner to the next (e.g., from product development to communications) or between global and local marketing teams. As in the classic “telephone game,” multiple handoffs over time result in a fractured brand positioning that bear little resemblance to the original.

Volvo faced the same hurdle when it was looking to evolve its brand positioning to represent attributes desired by consumers: “excitement” and “desirability.” After initial attempts failed to influence consumer perceptions, Volvo realized that marketing stakeholders were unintentionally altering the brand’s positioning by overlooking important details and misinterpreting others. A more robust approach to protecting the brand’s positioning was needed.

To prevent distortion of the brand’s positioning as it made its way around the organization, the brand team at Volvo decided to introduce the following simple, but highly effective, tools to be used by all internal stakeholders at key moments in the product and communications development processes:

The “Six-Box” Tool. Developed by a cross-functional team, this ensures a clear focus on the right brand positioning details from the outset of any initiative by providing a concise description of a brand’s positioning. These details are aligned around six themes: a) core target customers, b) customers’ beliefs and behaviors, c) customers’ reasons for buying, d) the brand’s role in the Volvo portfolio, e) pricing considerations, and f) a competitive assessment.

Mood Boards. The Brand team uses this tool to translate the key positioning attributes gleaned from data-heavy market research reports into the visual format that will resonate with creative types, such as designers, agencies, and communications teams.

Global Communications Brief. This tool provides a framework for designing concepts and communications in different geographies that break free of bias toward past media selections and, instead, focus on those that will best support the brand’s positioning.

Communications Checklist. To ensure that back-end communications development—the area most susceptible to misinterpreting front-end thinking—matches the original brand positioning, Volvo’s central marketing team translates the brand positioning into detailed communications requirements tied to the components of the “Six-Box” tool.

Volvo’s “zero-deviation” approach to brand positioning ensures that all participants in the marketing value-chain – from front-end new product development all the way to back-end multi-channel, multi-agency communications – align to the desired brand positioning. Going back to the original purpose of the “toolkit” Volvo created, the company was able to shift consumers’ perception of the brand on measures of “excitement” and “desirability.” Members: for more detail on Volvo’s approach, please see our full practice write-up.

Not long ago, LG Mobile developed a new segmentation model.  Marketing leaders at LG Mobile quickly realized that to engage consumer segments more effectively, they needed to embed these segments into everything that LG’s employees do. Marketing leaders began by asking themselves the question- Is the segmentation understandable, relatable and relevant? Taking this as a starting point, LG worked to sell the segmentation internally. LG followed a 5-step process to create an internal buy-in of the segmentation.

LG’s success with the new segmentation is largely attributable to development of rich personae for each of their customer segments based on extensive qualitative and statistical studies. However, they didn’t stop at just defining segments; rather segments were introduced as relatable people with names, personalities and entire living spaces devoted to them.  If you work in LG Mobile’s corporate offices, escaping Friendster Fran’s or Gadget Garry’s presence was impossible. Employees befriended their new segment pals and soon talked of them in cafeterias, workstations and even in boardrooms. Employees came to refer to the personae as if they were personal friends or neighbors—not a bad litmus test for understanding how sticky your segmentation is.

MLC members, M. Ehtisham Rabbani, Corporate Vice President Product Strategy and Marketing with LG Mobile, shared his learning and perspective on segment personae with the MLC membership. We broke down Mr. Rabbani’s sage segmentation advice into bitesize clips.

What can moscato teach us about marketing planning and skillsets of socially-savvy marketers?   More than you might imagine.

This sweet wine sourced from the Muscat grape was a rounding error on annual wine sales in the US.

Until Drake came along.

“Of the Sir Francis variety?” you ask.

No.

Drake is a hip-hop artist.  He rapped “clap clap bravo, lobster and shrimp and a glass of moscato” (you’d find this poetry in the single entitled “Do It Now”, of course).   And not long thereafter, a spark became a moscato wildfire, as you can see from the Google Analytics chart here.

Sales of moscato spiked 76% in the last year—not bad when overall wine sales were flat.

Looking back a year ago, that’s a pretty big opportunity for a wine marketer sitting on a sleepy moscato brand.  But it would take keen listening and a marketing organization with some surge capacity to take advantage of the wildfire.

In  “Why You Need a New Media Ringmaster” (appearing in the latest issue of Harvard Business Review), I wrote about the three traits most distinguishing a new breed of social media marketer from more traditional marketers.  One of those traits is “high decision clock speed”.  New Media Ringmasters don’t just make quick decisions themselves—they set their organizations up to operate on a much faster cycle time.

That starts with establishing an enterprise listening system that is comprehensive.  Further, it means spreading listening tentacles into the proper workflows around the organization (not just in marketing), to ensure speedy response on smaller scale issues.  As important, for larger opportunities, it requires marketing leaders to think differently about resourcing marketing initiatives. There’s an increasing need for marketers to maintain more “surge” capacity—both within marketing and among key agency partners—so their brands can capitalize on flash opportunities, like the Drake moscato mention, before competitors do.

We’d love to hear from you—what are you or your marketing team doing to increase your decision clock speed?  How are you building surge capacity into your 2011 marketing plan?  By the way, these are among the issues that MLC will take up in its 2011 research.  Send me a note if you’d like to talk with us about this (pspenner@executiveboard.com).

For another great example of a flash opportunity, see Bob Nunn’s blog on “Movember”—yes, it’s the perennial surge in popularity of mustaches around November, and how major mustache grooming brands seem to be a day late and two bits short in taking advantage of it.  Or, if you haven’t read it, get yourself a complimentary copy of “Why You Need a New Media Ringmaster” .

Also, be sure to check out our upgraded marketing planning solution. MarkPlan™ 2010 is a software suite that leads you through a series of well defined steps and proven templates for building strategic marketing plans that fit your organization.  Think of it as a TurboTax wizard that will help you generate your marketing plan.  Learn More.

As we talk to heads of Sales, Marketing and Communications about 2011, I see a swing back to handling a common enemy – this time, ongoing uncertainty.  Uncertainty isn’t terribly attractive to most, but executives seem to be accepting it as part of the new normal and are trying to figure out ways to live alongside it.  That presents a little differently depending on your role in the organization.

• In Sales for example, the problem is that deals are getting “stuck” with customers whose response to uncertainty is indecision. But it looks like most sales teams aren’t doing enough to make deals easy for customers, abandoning them prematurely in the sales cycle.

• For marketers, the challenge lies in figuring out – and then using to their advantage – changes in the way customers think about purchasing (triggered by the uncertainty customers face).  Coping mechanisms like in-the-moment comparison and peer feedback are driving psychology few companies fully understand, but must.

• Communicators are trying to help their organizations deal with uncertainty.  Specifically, as companies try to become more agile and responsive, the premium on moving information and aligning the organization increases.  But those are new-ish areas to most Communications teams.

How is uncertainty affecting you and your organization?  What are you planning to do about it?  Our research makes it clear that early movers in moments like this stand to gain disproportionately. I hope you’re one of them.

While you might not exactly be “carbon copying” your previous plan, determining which elements to include in your plan, as well as how to ensure you’re planning around your customer, your products, and your partners requires huge effort and a significant amount of experience and knowledge. Each step of the process requires a comprehensive understanding of various marketing concepts and tools to ensure the strongest possible marketing plan.

For example: assume that your team is building a marketing plan for a growth brand or product. One of the early steps in identifying sources of growth is developing an accurate assessment of current and potential markets.  Your team needs to:

• Link emerging market trends to customer and stakeholder needs
• Use market insights to build the business case for seizing new market opportunities
• Identify value driver trends across industries and segments
• Create objective criteria for assessing undefined opportunities
• Screen opportunities based on sources of differentiation

According to Marketing Excellence Survey research, however, about 1/3 of marketers (of 43,000 first time respondents of the MES) had below average scores for marketing planning knowledge.  Surprisingly, this lack of knowledge is not just limited to small companies, or industries that aren’t known for their marketing prowess. In fact, this lack of marketing capability is spread across many industries including computer software and internet, construction/engineering, financial services, food & beverage, manufacturing, retail, and telecommunications services.

Every CMO and member of the marketing leadership team needs to believe that your team is functioning on all cylinders when it comes to marketing capability. But the scary thing is that your team might not have anywhere near the marketing knowledge necessary to conduct these assessments in a high quality way. Worse: do your teams even realize they aren’t equipped to manage marketing planning, new product development, and the like?

Based on our survey, we know that most marketers are predicted to make bad strategy and execution decisions because of overconfidence. Based on a survey of 65,000 marketers, they assess their knowledge and skill sets to be 25% better than is the actual case.

Are you confident that your team has the capability to get marketing planning right?  Are they spotting early opportunities for growth and differentiation?  How prepared are they really to leverage the consumer insight and marketing planning tools that lead to discovery of these growth opportunities? Do they know what they don’t know?

MLC members, join us on October 19 for “Building Better Marketers“, a teleconference that will give you insight into the skill and knowledge gaps that could be affecting your team’s ability to run competitive marketing planning.  We’ll review key findings, comparing scores from the most recent Marketing Excellence Survey respondents to our database of 65,000 marketers.

Also, be sure to check out our upgraded marketing planning solution. MarkPlan™ 2010 is a software suite that leads you through a series of well defined steps and proven templates for building strategic marketing plans that fit your organization.  Think of it as a TurboTax wizard that will help you generate your marketing plan.  Learn More.

As planning season got started, Anna shared thoughts on how to justify spend increases in a down economy, courtesy of Pat LaPointe of Marketing NPV. The takeaway here? Squeeze every drop from your current spend, make your priorities clear, and actively manage risk. Your CFO will thank you!

The next week, Erin explained how the best B2B marketers select metrics for their insight marketing campaigns. That’ll vary depending on the campaign, but what’s important is to select metrics that continually measure the engagement of both your customers and your sales staff.

Pat Spenner told us how marketing leaders aren’t just relying on better-planned campaigns to drive their bottom lines – they’re also holding onto their budgets and expecting greater results out of fewer marketers. Why? Suspicion over the long-term direction of the economy – why spend when you can save?

Karen talked about how it’s essential to link marketing plans to broader corporate priorities, and explained how one MLC member did it, and got buy-in from business partners across the enterprise. The key things here are to poll relevant stakeholders, explicitly map the link from corporate goals to marketing priorities, and build a dashboard to allow transparency, accountability and ongoing evaluation.

Pat then shared MTV Network’s approach to planning. They identified a key problem – marketers plan for what is, rather than what will be – and solved it by integrating a variety of market and channel data into the planning process.

Finally, Whitney presented the ultimate in simple marketing plans – MasterCard’s plan on a page. While putting your entire marketing plan on one page may sound miraculous, it’s anything but – MasterCard marketers pick one goal for the year, only plan activities that further that goal, and select rigorous metrics that ensure they’re going the right direction.

Having shared our perspective across the last month and a half, we want to hear from you. What is your organization doing to ease the pain of planning? What do you think could be improved in your process? How are you incorporating non-traditional channels into your plan?

MLC members, as your planning process comes to a close, ours is just beginning! We’re looking into our research agenda for 2011, and we need your input. Please take a few minutes to complete this survey, which will help us narrow down our priorities for 2011.

Labor Day marked the unofficial close of summer.  And sadly, it also marks the unofficial end to reasonable procrastination when it comes to planning for 2011.

We’ve done our best at Wide Angle to provide inspiration across the dog days of summer, highlighting best practices to link marketing activity to strategic priorities, select meaningful metrics, and make the case for additional marketing dollars.  You’re out of the woods … almost.

In most companies, much of the planning occurs in a bottom-up fashion, with a number of separate plans created even within the marketing organization.  We’ll see marketers with a plan from the Promotions team, a plan from the Web team, a plan from the Social Media team, etc.  This kind of planning process is too disjointed, too disconnected, and—with so many pages of individual planning documents—too cumbersome to support any consistent, integrated execution across the broader marketing team.

Enter one of my favorite planning tools: the “Plan on a Page” from MasterCard.  This is literally one page that explicitly ties marketing activities back to higher-level objectives, serving as a roadmap for Marketing but then also helping peer functions understand the role they play in achieving those objectives.  In addition to its sheer brevity, there are a few principles necessary to make this approach work:

• Limit the scope. MasterCard ruthlessly distills its goal for the year down to just one thing.  Admittedly easier said than done, but really the foundation for building all the later steps in the “Plan on a Page”.
• Keep it focused. Choose a small number of objectives that directly drive the stated business goal.  Then detail those strategies that present the most effective way to achieve the stated objectives.
• Make it count. Select metrics that, if achieved, mean we executed on the strategies … which means we should also hit our objectives and the goal.  Focus on marketing activities that will drive these metrics up, and weed out those that don’t actually help us achieve desired business outcomes.

A big complaint we hear from the membership about planning is how hard it is to make 10, 20, sometimes 100+ page documents come alive for peer functions (like Sales or New Product Development) or for outside stakeholders (like ad agencies).  With the “Plan on a Page” it’s here for the entire world to see—not buried on page 37 behind all the market research and financials.

MLC members: check out the full case from MasterCard for a more detailed look at developing the “Plan on a Page”.

And with planning season in full swing, be sure to check out our upgraded marketing planning solution. MarkPlan™ 2010 is a software suite that leads you through a series of well defined steps and proven templates for building strategic marketing plans that fit your organization.  Think of it as a TurboTax wizard that will help you generate your marketing plan.  Learn More.

(Note: This is Part 4 of our 6-part series on marketing planning. Part 1, “Making the Case for Higher Spend“,  can be found here. Part 2, “Selecting Metrics“, can be found here. Part 3, “Marketers Squeezing Productivity“, can be found here. Check back here every Wednesday in August and September for a new installment!)

As you’re preparing for another year of marketing planning, ask yourself these three questions:

• Do our marketing plans reflect our company’s overall strategic objectives?
• Are our marketing plans based primarily on incremental changes to last year’s activities?
• Even if we know that marketing is making progress, can we tie our activities to business objectives?

We all know what the answers here should be, but how many of us actually get it right?

You may be in the enviable position of not having to justify every expense, but for many organizations, Marketing contribution to firm performance is underappreciated.  Critical to overcoming this?  Making the link between marketing activities and corporate goals as clear as possible.  Here’s how one member organization cracked this nut (MLC members, you can find the full case here):

Step one: Poll all relevant stakeholders –within and beyond Marketing.  Survey midlevel to senior marketing leaders to capture their views on the current and “correct” focus (in terms of specific goals, metrics, and activities) for Marketing.

Step two: map the link from corporate goals to individual marketing activities.  This is generally low-tech and done with sticky notes, a white board and a facilitator (see the picture for how it looks).  This turns out to be easier than you might think.  Here’s where you’ll find that a number of marketing goals, metrics and activities can’t actually find a home.  Some of these may deserve to go away forever, others just need reconsideration of why you’re doing them.  An external facilitator can help ensure the process doesn’t become political

Step three: build a dashboard to allow transparency – and accountability – throughout marketing.  While admittedly this is where they spent some money (and used a vendor), solid dashboards can be built even within Excel.  What’s important here is transparency.

For the company we profiled (pseudonymed as Vista), this transparency made a big difference.  While many business units had come to accept weak metrics or soft goals for many marketing programs, the ability for management to peer into marketing progress practically ensures that all marketing programs are clearly tied to supporting discrete marketing goals. Junior marketing managers suddenly must reassess their mix and devote greater up-front attention to alignment and impact.  And in one year Vista saw a pretty big swing in their marketing mix.

The CEO was certainly impressed, saying: “The importance of accountability and measurement is key in everything we do; it’s about making the right investment decisions.  Marketing is clearly on board, demonstrating its impact on the achievement of our strategic goals.”

MLC members, take a look at the dashboard here – the full case includes screen shots and more functionality. And, if you’re looking for a little help in your planning process, please check out MarkPlan, MLC’s new software suite designed to help you write strategic, actionable, and impactful marketing plans that fit your organization.

(Note: This is Part 3 of our 6-part series on marketing planning. Part 1, “Making the Case for Higher Spend“,  can be found here. Part 2, “Selecting Metrics“, can be found here.  Check back here every Wednesday in August and September for a new installment!)

Early results from the Council’s ongoing marketing budget and spend survey suggest that Marketers are (understandably) cautious as they look ahead to 2011.  With the cooldown in businesses re-stocking their inventories and consumers continuing to keep pursestrings drawn tight, budgets appear to be flat to marginally up.

• Anticipated 2011 marketing budget as a percentage of revenue appears to be running about 2-3% lower than in 2010
• With 2011 revenue growth for the S&P 500 forecast to be in the 3-6% range, that amounts to an absolute budget increase of 1-3% for your average large enterprise.
• Marketing leaders are holding onto as much of their working budget as possible, hoping to fund that by capturing greater productivity from fewer marketing staff.  The early numbers suggest marketers are shifting the people/program split by 1-2 percentage points in favor of marketing programs (i.e., 32%/68% split to 30%/70% split)

Looking for a quick benchmarking pulse check to inform your marketing planning?

Take the marketing spend “Cosmo quiz”:  it’s short and sweet—will take you less than 3 minutes—and you get some immediate benchmarking feedback at the conclusion of the survey on your marketing program vs. people spend for 2010 and 2011.

We’ll even recommend your ideal marketing mix based on your astrological sign!

(I’m kidding.  That approach, of course, would be foolhardy…unless you know you are a Taurus with a bad moon rising, in which case it would make perfect sense for you.)

As we gather responses from enough organizations to create benchmarking sets at the industry or category level, we’ll provide the data back to members from those industries who took this short survey.

MLC Members, with planning season in full swing, be sure to check out our upgraded marketing planning solution.  MarkPlan™ 2010 is a software suite that leads you through a series of well defined steps and proven templates for building strategic marketing plans that fit your organization.  Think of it as a TurboTax wizard that will help you generate your marketing plan.  Learn More.

By Erin Lynch-Klarup

(Note: This is Part 2 of a 4-part series on marketing planning. Part 1, “Making the Case for Higher Spend“,  can be found here. Check back here every Wednesday in August for a new installment!)

B2B marketing organizations today are emphasizing the transfer of ideas to customers (just consider the rise of terms like “thought leadership”, “consultative selling” or “solutions”).  This makes sense – done right, an insight-based approach is one of the few ways suppliers can avert pure price-based competition. Additionally, our research shows that insight is valued by customers in the long term.  “Teaching” activities such as offering unique perspectives on the market or helping the customer navigate alternatives strongly predict loyalty.

It follows that marketing plans this year should have a strong insight orientation.  Naturally the marketing plan will align to broader organizational strategy, but the marketing objectives that support company strategy should be grounded in delivering insight that changes customers’ valuation of your offering.

Metrics, of course, are a key element of the marketing plan.  They’re the primary tool we use to operationalize marketing’s goals.  The right metrics will measure progress, yes, but also to communicate the marketing plan at a level that individuals can act on.

As we examined insight-led marketing this year, we found ourselves wondering how the metrics we track change for a marketing plan geared towards educating customers (in a way that prompts purchase).  In partnership with MarketingNPV, we’re in the process of developing a metrics framework for the insight-led world.

We’ve divided the relevant metrics into four categories:

Marketing

Broadly, we want to know if marketing is identifying compelling insights for target segments, and getting them out to those segments through content and sales enablement.

Sales

We want to know if marketing’s closest functional partner “buys” the insight-based approach.  Is sales adopting or even helping to co-create an insight-led sales pitch?

Customer Engagement

On the customer side of things, we want to know if customers are consuming our content and sharing it with others.  And if so, is this earning us purchase and loyalty?

Outcomes

Are we transferring insight to customers in a scalable way?  Are we teaching customers things that clarify their decision and prompt purchase?

MLC members, for more on how to build insight selling and commercial teaching into your marketing plan, please make plans to attend our webinar, Building an Insight-Led Sales and Marketing Strategy, on September 14. Two times are available; one from 9-10AM eastern, the other from 2-3PM.

120 years!  That’s 1.2 centuries.  Or, a decent-sized-fraction of a millennium.

Awe-inspiring, no doubt.  But what is particularly remarkable is that the basilica planners had to answer some extremely important questions before construction even began: would the building accommodate the size of the community in 120 years?  Would the design meet the aesthetic tastes of our grandchildren?  To answer these questions without the luxury of Excel, Stata or dartboards (created 100’s of years later by our friends in England) must have required luck—and prayer.

In many ways, it’s the equivalent of a modern-day, consumer product development cycle.  In a sea of shifting segments, who will purchase my product when it finally hits store shelves?  Not an easy question to answer, even with modern, predictive tools we now have at our disposal.

This long product development cycle is nothing new to the automotive industry, and is captured in the bowing of two new vehicles: the Chevy Volt and the redesigned Jeep Grand Cherokee (the two ‘poster-cars’ for the rebirth of the American auto industry).  Both are generating lots of media attention.  But which one will appeal more to buyers?  The gas hog or the gasless?  Two years ago, consumers joined a waitlist for a hybrid.  Now, the US government is declaring a slightly different message: Americans like big cars.  The shifting target phenomenon is nothing new to marketers.  Besides the obvious myriad of segments, volatile externalities like gas prices significantly impact the buying patterns of the US auto consumer.  So, someone’s Volt preference today very well could be a Grand Cherokee tomorrow.

The current crop of American autos is being hailed as fitting for the public’s taste.  Will it match consumption patterns tomorrow?  No one knows.

But within many of our manufacturing members’ organizations, the debates rage. Despite sophisticated models and scenario planning tools, most of these organizations struggle to reach adequate confidence levels around the likelihood and impact of each potential future state to take any decisive action.

The trick seems to be to avoid the endless discussion of probabilities, and focus on prioritizing the right focus for action by identifying the most certain changes to the environment and to business capabilities over relevant time frames—the goal being not to develop a more accurate model, but to ensure that the actions you are taking will guarantee success under the circumstances of the top three most probable scenarios. MLC members can click here for a case study of how an automaker did just that (beginning at page 31).

After that, of course – pray.

MLC members, for more on innovation and managing cross-functional teams in new product development, please visit our organizational management and innovation topic centers.

(Note: This is Part 1 of a 4-part series on marketing planning. Check back here every Wednesday in August for a new installment!)

Don’t know if it’s time to spend more on marketing?  Unsure how to convince the CFO?  Pat LaPointe – managing partner at NPV Marketing, a leading marketing measurement firm – recently spoke to our members about how to justify spend increases. Read on for a summary of his top tips.

NPV’s research shows that ‘historical spend’ is still the number one means of allocating marketing budget, but lacks both rigor and credibility with the CFO.  What CFOs want isn’t certainty about the ROI of marketing spend (no business investment has a certain ROI, e.g., building a new plant in a developing country), but rather clearly stated assumptions and a sound understanding of risk factors. You can make a solid business case that will pass the CFO ‘sniff test’ by taking the 5 steps below.

1. Squeeze every drop from the current spend mix.

CFOs’ top piece of advice?  “Don’t ask for more money until you’re sure you’re making the most of your current money.”  You can find extra money in your budget by identifying and reallocating spend with low returns.  One way to do this is to eliminate spend at the point of diminishing returns and below the point of critical mass (see curve below). To determine where you are on the marginal returns curve, bring together experts and key stakeholders to reach an informed judgment of what you expect to happen with the next incremental dollar of spend.

2. Prioritize opportunities for investment

Get a clear sense of where the next incremental dollar is likely to get the greatest payback across products/regions/channels. This can be done without a lot of data by ranking opportunities attractive, neutral or unattractive (relative to each other) across 3 dimensions: 1) current performance, 2) future opportunity, 3) impact of marketing/sales spend. Boost investment in opportunities that are attractive on most dimensions, maintain neutral opportunities, and fix or exit opportunities that are mostly unattractive. You may find that some of the opportunities in the fix/exit zone currently have a high level of spend, while some of those in the expand zone have low level spend.

3. Check that prioritized opportunities have “points of leverage”: Make sure additional spend in prioritized areas is likely to produce returns by ensuring the presence of at least 3 of the following:

a)     A strong value proposition,

b)    Customers that are able to switch (and be kept),

c)     Customers that are likely to be responsive to marketing,

d)    A clear, resonant, distinctive message.

4. Assess the environment: Having assessed internal issues, look at the environmental context (e.g., economic, sociopolitical, technological trends).  If you think your internal assessment of trends may be too subjective, consider hiring an economics professor from your local university.  S/he can run your sales data from the last 5-10 years against a battery of macroeconomic factors to find correlations and assess upcoming conditions.

5. Manage risk factors: Estimate the likelihood and potential impact of competitor actions as well as a host of other events (e.g., delayed advertising, strikes, bad weather etc.)  If a risk factor has a high likelihood and high impact, avoid investment or carefully manage against it.

MLC members, access the full webinar replay here or join our upcoming webinar on Avoiding the Pitfalls in Marketing Planning (Aug 18) for more tips.