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How To Align Marketing Technology With Business Strategy By David Raab

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From the MarTech Conference in Boston, Massachusetts, August 19-20, 2014. SESSION: How to Align Marketing Technology with Business Strategy - Given by David Raab, @draab - Principal, Raab & Associates. #MARTECH

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How To Align Marketing Technology With Business Strategy By David Raab

  1. 1. How to Align Marketing Technology with Business Strategy MarTech Boston August 19, 2014 David M. Raab Raab Associates www.raabguide.com draab@raabassociates.com
  2. 2. Strategy = method to a goal
  3. 3. Strategy Implications Strategy Statement: Attract large numbers of high-paying customers by creating a highly innovative product that can be sold via ‘buzz’ marketing. Financial Margin • High Number of customers • Add customers Revenue / customer • High  Customer Value Image • Exciting • Advanced Relationship Product • Unique  Internal Operations Marketing • Build ‘buzz’ Innovation • Simplified interface Production • Quick delivery Customer support Admin  Learning Information & systems Competencies • Outsourced manufacturing, • Channel training, • Design, • Marketing Organization Product-based
  4. 4. Successful Strategies • Steve Jobs’ Apple: insanely great products • Amazon: customer convenience • UPS: efficiency and reliability • Southwest Airlines: low cost
  5. 5. Unsuccessful Strategies • Steve Cook’s Apple: multi-color phones? • Steve Ballmer’s Microsoft: copy Apple? • JCPenny: high fashion or low price or in-shops or ??? • Radio Shack: only source for stuff nobody wants
  6. 6. Good Strategy: It’s All About Fit • Resources • Competencies • Market needs • Competitors • Environment
  7. 7. Strategy Implications Strategy Statement: Attract large numbers of high-paying customers by creating a highly innovative product that can be sold via ‘buzz’ marketing. Financial Margin • High Number of customers • Add customers Revenue / customer • High  Customer Value Image • Exciting • Advanced Relationship Product • Unique  Internal Operations Marketing • Build ‘buzz’ Innovation • Simplified interface Production • Quick delivery Customer support Admin  Learning Information & systems Competencies • Outsourced manufacturing, • Channel training, • Design, • Marketing Organization Product-based
  8. 8. Case Study: Strategy to MarTech Connection • Business: – New company, disruptive tech, clearly superior • Business Strategy: – Grow quickly by adding customers via partner sales • Marketing Strategy: – Now: support partners via joint field events – Future: build company-generated lead flow via media, Web site • MarTech Strategy: – Build for fast growth, future needs – Now: support field via self-service promotions – Future: support media via analytics, Web site via MA integration • MarTech Choices: – Now: best-in-class end-user email, forms, selections – Future: flexible MA database, data warehouse outside MA
  9. 9. Strategy to MarTech Framework Business Strategy Marketing Strategy MarTech Strategy MarTech Architecture MarTech Components • Focus: Product vs service vs cost • Financial: Margin vs number of customers vs revenue per customer • Value Prop: Image vs relationship vs product • Channels • Spending • Intimacy • User skills • Target metrics (CPA, LTV, ROI, growth, etc.) • System scope • Channel integration • Execution automation • Program sophistication • Flexibility • Scalability • Cost • Staffing • Shared vs siloed • Suite vs. best of breed • In-house vs outsource • Owned vs rented • External integration (CRM, Web, etc.) • Database • External data • Data quality • Identity association • Analytics • Decision engines • Execution systems (email, Web, social, events) • Management (content, planning, budget, etc.
  10. 10. Strategy to MarTech Example Business Strategy “Offer low prices profitably in online retail by running with low operating costs” • Focus: Cost • Financial: Modest margin, high number of customers • Value Prop: Relationship (trusted source of best prices for standard products)
  11. 11. Strategy to MarTech Example Marketing Strategy “Attract price-conscious customers by stressing low prices and making highly targeted offers; key metric is marketing ROI (=promotion efficiency)” • Channels: limit to major channels (easier to optimize) • Spending: tie closely to profitability but grow over time to gain scale • Intimacy: track customers closely to allow targeted offers • User skills: modest (standard skills needed; keep costs low) • Target metrics: ROI is most important
  12. 12. Strategy to MarTech Example MarTech Strategy “Keep costs low by running tightly integrated systems, highly automated systems with limited scope (i.e., optimize in only a few channels)” • System scope: manage all marketing interactions through single system • Channel integration: tightly integrate channel data; loosely integrate promotions • Execution automation: highly automated targeting to add revenue and reduce costs • Program sophistication: modest sophistication; only need targeted offers • Flexibility: accept limited flexibility in return for lower costs of optimized processes • Scalability: high to accommodate required volume and avoid replacement projects • Cost: as low as possible • Staffing: small, highly skilled staff to run automated systems and manage outsourced resources
  13. 13. Strategy to MarTech Example MarTech Architecture • Shared vs siloed: share all possible functions to reduce costs • Suite vs. best of breed: use suite to reduce costs, improve integration • In-house vs outsource: outsource to reduce costs; accept limited flexibility • Owned vs rented: rent at start but ultimately want to own to reduce costs • External integration (CRM, Web, etc.): highly integrated to capture and consolidate data and to present targeted offers during interactions
  14. 14. Strategy to MarTech Example MarTech Components • Database: standard database; limit unstructured data unless clearly cost-effective • External data: limited use to reduce costs • Data quality: basic capabilities required • Identity association: basic capabilities required; primarily tracking known customers • Analytics: highly automated offer targeting, media optimization • Decision engines: must insert business factors into decisionis (e.g. inventory levels) • Execution systems (email, Web, social, events): use suite features if possible • Management (content, planning, budget, etc.): use suite features; need tight cost management but otherwise only basic capabilities
  15. 15. What’s for lunch? Does anybody really do this?
  16. 16. Why Strategy Matters

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