Finding the Right Marketing Strategy

Finding the Right Marketing Strategy
And the Person to Lead It…

Chief Outsiders (Austin team)
Kirk Brand Coburn
Pete Hayes
Rex Bull
4M Scorecard

Objectives
Provide you with additional skills to aid
the TEAM in making optimal business decisions
Provide you with a fundamental knowledge base of Marketing Strategy 101
Help you determine the ROLE your CMO should play
Help you evaluate the effectiveness of your CMO

What do you want to Learn?

Out of Alignment
"We're 50% short."
“We're halfway there.”
“Only 13% of C-Level
believe their vision is
aligned with the CMO’s.”
Source: Peppers and Rogers Group

Without Alignment, Progress Can Be Dangerous
When marketing is properly aligned with finance and operations, there is a powerful combination to spur growth and profitability.
But if they are not aligned, disaster could be looming…are you experiencing?
Sales Issues = Churn/No Sales (Wrong Target)
Ops Issues = Shipping Delays (Bad Planning)
Finance Issues = Less Profit (Wrong Products)
Cust Svc Issues = Complaints (Different KPI’s)
= MARKETING ISSUE

PART II: The Role of the Marketing Lead

What are the Marketing Lead’s responsibilities?
Marketing shares the responsibility for the creation, maintenance, and growth of the value of the company
Marketing should position the company strategically in the market and in customers’ minds
Marketing should deliver a marketing strategy that makes customers believe the company is different and better than the competition
When this works, companies prosper.
Top 100 Marketing Focused Companies vs. MSCI World Index and S&P 500 Performance Interbrand
Source and Copyright: Interbrand Corporation 2008

What exactly does a good Marketer do?
Marketing is more than Fancy Creative:
A good marketer:
Serves as the market-focused voice to the CEO
Understands the market from the viewpoint of
the customer
Translates the CEO's vision/value proposition into
actionable, measurable plan
Understands the operational and financial
implications of marketing and growth programs
Understands “the business” and knows what
drives profitability
Aligns the company around the value proposition
Leads the dialogue that keeps the organization
focused and working together

Strategic Marketing in Three Phases
How much budget for each phase?
How much time spent on each phase?
Long before a creative campaign or marketing program is developed, a foundation in market research and business planning must be laid.
III.
Launch & Execution
The activities that execute and implement the plan
Pricing and Promotion
Channel Partnerships
Communication
Measurement and Analysis
Key Leading Indicators
I.
Market Research
The activities needed to
decide if the value is truly
valuable, worth pursuing.
Financial Modeling and Analysis
Market Analysis
Industry & Market Trends
Competitive Analysis
Research
II.
Business Planning
The activities to take the value from good idea to real creation.
Integrating the market focus with the operational and financial strategies of the company
Product/Service definition
Supporting system and structure
Development of Alliances and Channel Partners
Step 1: Continual Refinement
Step 2: Measure & Alignment
Step 3: Function of Steps 1 & 2
Understand the company
Understand the customer
Understand the competition
Align the organization
Prepare the company for
implementation
Budgeting
Go-To-Market
Communication
Measure

Phase I: Find Your Inner Hedgehog
Marketing strategy is simple:
PHASE I - Research
Find your hedgehog
What drives your economic engine?
What is the Company passionate about?
What is the Company the best at doing?
Identify your target customer
Identify your customer's needs (not wants)
Can your management team identify:
Your most profitable products, segments, channels and customers?
Activities or situations would have the biggest positive and negative impact on profitability?
The thing your company does better than anyone in the industry?
The things your company needs to become really good at in order to be seen as different by your customers?
What customers value most about the way your company interacts with them?

Phase II: Align the Organization
Once a direction has been set, the organization needs to align behind the vision.
Every department needs to understand its role in the market-based go-to-market strategy
Operational, systems or procedural changes can be the biggest part of a marketing strategy
Often the best marketing strategies are based on changing how products, services, or information are delivered to a customer
If Sales & Marketing charge off promising one thing to customers, and Operations is focused, measured, and bonused on something different, and if Finance is not a partner that helps to develop, measure and evaluate the profit impact, nobody wins.

Case Study: VanguardAligning an organization behind customer insights
Vanguard learned customer service is not a one-size-fits-all proposition. (Phase I)
Vanguard aligned the way it did business with the market learning. (Phase II)
Vanguard's market segmentation approach drives customer loyalty, a key driver of future revenues.
Working media and advertising (Phase III) were a small part of this marketing effort.

Case Study: McDonald’s
McDonald’s turnaround was based on:
Understanding changes in customer’s needs (Phase I)
Changing product and store operations (Phase II)
Telling consumers about the changes (Phase III)
Copyright/Trademark McDonald's
Market Capitalization
From 1998 to 2003 as Ronald McDonald's image wore thin and fast food purveyors were being linked to obesity, McDonald's market capitalization fell $12.2 billion.
(Source: BusinessWeek)
In 2004 McDonald's began revitalizing the brand by modernizing its image and adding salads, fruit slices, and grilled chicken to the menu.
The change at McDonald’s was marketing led, starting with changing the product, then the message.

Case Study: Dell Retail (New Channel)
Moving into Phase III without understanding Phase I & II can be dangerous
Dell did understand that the Retail Channel attracted New Customer Type (Phase I) BUT
They did NOT adequately align the internal team and plan around the new channel (Phase II)
The Retail Decision still remains to be seen as to whether it is accretive … (Phase III)
Dell Retail was out of alignment
Target growth unattainable with current marketing plan
New retail channels reduced profit margin percentages
New channel products created internal and external confusion
No systems in place to track results, sales, or customers
Tier 3
Non-computer savvy, technology-averse
Tier 2
Need to touch-and-feel before purchase
Tier 1
Computer savvy, middle-aged, high disposable income
Dell Core Market

Phase III: Marketing Minefields
Measuring the effect of short-term decisions
on long-term objectives.
Net effect of advertising budget cuts
Diminished customer experience
Lower grade materials
Product pipeline cuts
Here is where things can get “touchy feely” or hard to measure.
Rule of thumb – A well-qualified marketing lead who understands Phases I and II, and works with finance to develop and implement marketing strategy, can likely be trusted in Phase III as well.

Intangible Doesn’t Mean Immeasurable
While elements of the marketing “spend” may be immeasurable, the results they are intended to drive should be measureable.
Leading Indicators
Critical business drivers that are:
Measurable
Manipulable
Customer Centric (at least 2)
Lagging Indicators
Revenues
Profits
Economic Value (Add 4 score)
Net Promoter Score

Sample Dashboard
Driving Analysis Around Marketing Activities to Ensure Accountability and Transparency

Comprehensive Approach – Investment Strategy
Each marketing activity is intended to drive toward a specific result. Look for ways to measure results at multiple levels.
Awareness Consideration Decision Support Refer Upgrade
Search Engine
Optimization
Web Refresh
New Booth?
Social Marketing/BLOGS
Major Events
Collateral
Online & Print Advertising
Cooperative
Partner Mktg
Reseller
Relationships
Product 3.0 Launch
Giveaways
Product Satisfaction Survey
Case Studies/Testimonials
Press/Analyst
relations
Reseller Event?
Video Demos
(Web & Syndication)

Case Study – Harrah’s Casino: Target Practice, Marketing Style
Marketing helps identify the most profitable customers, then aligns the organization to develop and execute strategies to win them over.
Phase I: Research
Harrah's Casinos identified customers that were
Passionate about
Good at serving
Could distinguish themselves from the competition with
Phase II: Business Planning
Harrah's targeted:
Gamblers (not spa-goers or show-seekers)
Gamblers who spent >$100/day but <$500 per day
Harrah's created:
Rewards program to track behaviors and measure key indicators
Operations and IT Systems
New financial reporting
Plan to align entire company around new focus
Phase III: Launch and Execution
Harrah's tracked:
Share of wallet
Loyalty program upgrades
Result: Leading indicator
The number of customers visiting cross-properties predicted future revenues

PART III: Evaluating the Effectiveness of your CMO

Is Your Marketing Lead the Real Deal?
Business Planning
Align marketing strategy with financial and operational strategy
Forecast net income with +/-10% margin
Can lead the market focused portion of executive team discussions
Track and measure leading and lagging indicators to determine success of marketing programs and objectives
Ensure employees can clearly articulate the value proposition
Research
Work with the CFO to understand profitability drivers, most profitable customers, and market segments
Can logically discuss the customer’s business and business drivers
Know the cost of customer acquisition
Can clearly define the market size, market position and market share of the company
Understanding how a large company can scale the value proposition to earn profits at higher volumes
Launch & Execution
Ensure employees can clearly execute and deliver on the value proposition
Treat budgets seriously
Drive profitable growth via positioning and differentiation
Trend leading and lagging indicators higher, year over year
Only make promises the company can keep
Convince customers you are easier and faster to do business each cycle and vs. competitors
Demonstrate higher gross profit than the year before

CMO = Chief Metrics Officer
Do you think you have the right metrics?
How many of your most profitable clients and products can you identify?
How much does it cost to acquire new clients?
How consistently can you define your value proposition?
What percentage of your management team is aligned toward the same goals, measurements, and key leading indicators?
How quickly can your leadership team respond to change?
How large can you scale your value proposition to earn profits at higher volumes?
How good are your financial forecasts (Hint: You should be aiming for +/-10% of net income)
How much of the capital you need to fund future growth do you have?
How much of your capital is invested effectively to maximize profits?
How complete is your plan to battle your greatest risk?

Here’s a sample marketing budget: How would you evaluate it?
EXPENDITURE SUCH AS BUDGETED
It can’t be done.
Nothing on this page helps you determine how good this marketing budget is.
Without a solid understanding of the market (Phase I) and a marketing strategy (Phase II) a marketing budget is useless.
Tradeshow booth, visitor center
Courses, Marketing Assoc fees
Tradeshows, Excellence Awards
Website, Graphic Design, Customer Profiling
Bacon's Monitoring Service, PR firm
Print, Internet
Global shipping
Pricing strategy
MDFDocumentation, Media, Getting Started Guides
APAC, EMEA, NAM, LAM
APAC, EMEA, NAM, LAM
CapEx
Headcount
Employee Education
Programs/Tradeshows
Market Research/Business Intelligence
Marketing Projects
Public Relations
Advertising
Other Shipping
Solutions Marketing
Partner Levarage
Product Packaging
Field Marketing
Sales Programs
TOTAL
250,000
565,000
100,000
225,000
75,000
182,000
93,000
340,000
101,000
42,000
(225,000)
65,000
300,000
355,000
2,468,000
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$

When to Pull the Trigger or the Plug
Q: How can the MGT TEAM be sure new initiatives will be successful?
Q: How much information or research is enough?
Q: How can customer demands and volume forecasts be confirmed?
A: You will never know. Get over it and start asking yourself and your team the best questions you can ask.

The CMO’s Role in the Go/No-Go Decision
Ask probing questions so the management team can understand the justifications and the risks
Provide financial information to frame the investments, risks, and paybacks from the strategy
Provide insight into breakeven volumes
Ask
What is the key driver that will determine if the
program will drive profit or not
When will we know if the program is working or not
What is the financial exposure at that time?
How do breakeven volumes compare to
marketing forecasts?
How big is the risk compared to the reward?
What's the total investment required for this to
succeed?
What financial commitments must be made, and
when?
What portion of the investment is a total loss, what can
be recouped if success is not achieved?

Measure, then Align for Success
Chief Outsiders Scorecard

Vragen?
Preguntas?
Fragen?
Vragen?
Questions?
Spørgsmål?
Kysymykset?
Frågor?
Kysymykset?
Spørgsmål?
Preguntas?

Thank You
For your FREE COPY of our CMO Scorecard,
email Kirk@ChiefOutsiders.com
Kirk Brand Coburn
Principal Chief Marketing Outsider
kirk@chiefoutsiders.com
Pete Hayes
Chief Marketing Outsider
pete@chiefoutsiders.com
Rex Bull
Chief Marketing Outsider
rex@chiefoutsiders.com
www.ChiefOutsiders.com

http://www.chiefoutsiders.com	75
http://www.slideshare.net	33
http://www.transloopa.com	1
http://www.brijj.com	1

Finding the Right Marketing Strategy

by Kirk Coburn on Mar 03, 2010

Accessibility

Categories

Tags

Upload Details

Usage Rights

4 Embeds 110

Statistics

Finding the Right Marketing Strategy — Presentation Transcript