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Marketing Services Excellence: Driving Costs Down and Effectiveness Up


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Marketing organizations today are under increasing pressure to deliver quality services to their internal clients while holding down costs. To remain competitive, Marketing leaders need to understand how their expenses, services scope, resources, organizational structure, and use of off-shore labor sources compare with those at other companies so they can identify and close performance gaps. This cross-industry benchmarking study provides metrics and critical insights for evaluating the effectiveness of the Marketing Services/Operations function, including Creative Services, Support Services and Market Research & Analytics Services.

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Marketing Services Excellence: Driving Costs Down and Effectiveness Up

  1. 1. BEST PRACTICBest Practices, LLC Strategic Benchmarking ResearchMARKETING SERVICES EXCELLENCE:Driving Costs Down & Effectiveness Up
  2. 2. BEST PRACTICTable of Contents Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 3 Research Overview Participating Companies Executive Brief Best-in-Class Comparison Cost-Cutting Practices that Pay off for Benchmark Participants Management Practices that Support Global Consistency Marketing Services Landscape . . . . . . . . . . . . . . . . . . . . . . . . . . . .Page 11 Creative Services, Support Services, Market Research & Analytics Marketing Shared Services Model — Including In-HouseAgency & Center of Excellence Organizations . . . . . . . . . . . . . . .Page 24 Performance Metrics & Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . .Page 37 Best Practices & Lessons Learned . . . . . . . . . . . . . . . . . . . . . . . .Page 47 Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 56 Company Information Detailed Data Charts2Copyright © Best Practices , LLC
  3. 3. BEST PRACTICExecutive Summary3Copyright © Best Practices , LLC
  4. 4. BEST PRACTICESTopics IncludedStudy Overview Organizational structure types Funding sources Drivers of program effectiveness Core creative & support servicesprovided Market analytics & market researchofferings Comparative metrics for lead time& cost of delivering 10 key services Cost-cutting practices Global locations for services Key functional objectives Effective performance metrics Future trends Best practices & lessons learnedResearch Objective: This cross-industry studyinvestigates how companies are effectively structuring& operating the Marketing Services function within anenvironment characterized by increasing globalization& shrinking resources.The study objective was to develop comparative industrymetrics for deliverables cost , lead time & quality, as wellas for structure type, drivers of program effectiveness &the number & type of services provided at leadingcompanies. Results will provide Marketing Servicesorganizations with a reference point they may use infuture strategic planning.Methodology: Best Practices, LLC engaged 24Marketing leaders at 23 companies operating MarketingServices functions within North America, South America,Europe & Asia to participate in an online benchmarkingsurvey. In addition, research analysts conducted deep-dive interviews with selected respondents to collectqualitative data & insights.Research Overview: Objectives, Methodology & Topics CoveredBest Practices, LLC conducted this cross-industry benchmarking study to identify industry metricsand innovative practices that Marketing and Shared Services leadership can use in strategicplanning for the Marketing Services function.4Copyright © Best Practices , LLC
  5. 5. BEST PRACTICParticipating Companies Represent Nine IndustriesBenchmark ParticipantsTwenty-four Marketing Services leaders from 23 different companies participated in this benchmarkingstudy. They represented nine different industries. IT/Computers and Healthcare/Pharma are the largestof the industry segments.5Copyright © Best Practices , LLCRepresented Industries* Other: Communications,Logistics, Energy, AssociationManagement, Real Estate*(n=24)
  6. 6. BEST PRACTICMarketing ServicesLandscape6Copyright © Best Practices , LLCBack to Table of Contents
  7. 7. BEST PRACTICMarketingAnalytics /MarketResearch, 22%Other, 11%CreativeServices , 36%MarketingSupport , 32%Creative & Support Services Make up 68% of WorkloadOn average, benchmarked functions estimate that creative services and support services each makeup about one-third of the Marketing Services workload, while marketing analytics/market research andother functions consume the rest of the time.(n=22)Q. Estimate the percentage of your functions work that falls into each of the following categories. If you have noservices in one of the categories, specify "0." (Total should equal 100%.)7Copyright © Best Practices , LLCMax 100%75th Percentile 50%Mean 36%Median 30%25th Percentile 20%Min 0%Marketing Services Categories:Creative Services:Max 80%75th Percentile 40%Mean 22%Median 13%25th Percentile 5%Min 0%Max 60%75th Percentile 49%Mean 33%Median 38%25th Percentile 16%Min 0%Marketing Support:Marketing Analytics / MR:Max 70%75th Percentile 20%Mean 11%Median 0%25th Percentile 0%Min 0%Other:* Other: Compliance, Packaging, PR, SalesAdmin, Strategy, Systems Team, EngineeringDistribution*
  8. 8. BEST PRACTICDigital/Web, Email & Collateral Are Core Creative ServicesEmail communications, digital marketing and collateral development are the top three mostly commonlyprovided creative services. On average, participants provide 5.8 of the eight benchmarked creativeservices.57%57%65%70%70%83%87%91%13%Other (specify):Merchandising (Point of sale collateral for retail channels)Search engine marketingCopywritingSupporting channel marketingSocial media (Blogs, User groups, Facebook, Twitter etc.Collateral design and development (e.g., brochures, datasheets, white papers)Email communications (Inbound, email direct marketing &internal emails)Digital (Web publishing, develop and maintain web page andbanners)(n=23)Q. Please indicate which of the following creative services your Marketing Services function provides.(Choose all that apply.)* Other: Ad campaigns, Events signage; TV production/ cinema + apps; Video/Photography/Proposal*Creative Services Offered:% Responses8Copyright © Best Practices , LLC
  9. 9. BEST PRACTICES9Copyright © Best Practices , LLCCentralized Shared Services Model with Offshore OutsourcingAsia U.S.SouthAmericaA Marketing Shared Services model that has been successful for one interviewed company involvescentralized leadership in the U.S. with outsourcing of transactional and technical support servicesto offshore locations in Asia and South America. Creative services are at headquarters and otherU.S. locations.Transactional/ Technical Support Services:Outsourced to offshore locations• Create lists/ segmentation• Perform analytics, “number crunching”• Email campaigns• Update/create web pages• Build landing pages• Create marketing collateral• Copywriting• Social media content• Channel marketing• Central management• Strategy & policy• Global oversightMarketing Shared Services LeadershipCentralized at U.S. HeadquartersU.S.Creative Services:U.S.- based staff
  10. 10. BEST PRACTICOther:Japan, Colombia,United Kingdom& Singapore areamong additionallocations whereparticipantsoperate MarketingServices nodes.91% Have Marketing Services Staff in U.S. LocationsThe United States is the only geographic area where nearly all of the participating MSS groups locatesome marketing services. Common locations for nodes outside the U.S. are India, Canada, China, Braziland Mexico. On average, participants have service locations in three of the eight benchmarked regions.Q. How many Marketing Services locations does your company has in each of the following countries orregions? (Choose one for each country/region.)10Copyright © Best Practices , LLC
  11. 11. BEST PRACTICFor 91%, Service Offerings Vary Across Regional Nodes(n=11)Q. Do your different Marketing Services locations offer the same group of standard services or is therespecialization? (Choose one.)Location Specialization:Other (specify):, 9%Locations are mostlythe same but somehave extra services46%Service offerings forthe centers are notstandardized27%Every location offersthe same coreservices only9%At least one locationis identified as aCenter of Expertise9%* Other: A few have in house creative services, some use outside agencies*11Copyright © Best Practices , LLCMost of the participants have some variation in services across nodes or regions, with only 9% offeringthe same services at all locations. For the largest group (46%), services are mostly standardizedacross locations, but the some nodes offer more services than others do.
  12. 12. BEST PRACTIC45%9%14%5%5%36%59%50%59%50%50%41%18%36%36%45%50%59%32%Budget level for functionNumber of hubs/regional nodesLevel of outsourcingOperations in low-labor-cost marketsNumber of services offeredIntegration with ITIntegration with Shared Services functionsMore Integration & Less Budget Are Top Changes on HorizonMore than half the participants expect to see increased integration of Marketing Services with SharedServices and with Information Technology at their companies over the coming year, while 45% anticipatereduced budgets. In addition, about a third anticipate more operations in low-cost labor markets and anincreased number of hubs or regional nodes.(n=22)Q. What changes does your Marketing Services function expect to see in each of the following areas over the next year?(Choose one for each.)No Change IncreaseDecreaseAnticipated Change:12Copyright © Best Practices , LLC% Responses
  13. 13. BEST PRACTICUse a Vendor Management Strategy to Get Best PricesVendor management strategies, teaming with procurement and automating the vendor price quoteprocess cut costs for participating companies.13Copyright © Best Practices , LLC1. Work with the global purchasingor procurement team to prequalifyvendors.2. Use preferred providers.3. Get three bids on all work.4. Negotiate with selected vendors.5. Develop templates for the quotesand load them into the marketingservices management system toautomate and expedite the quoteprocess.“We can send out a quote within amatter of seconds. All of the vendorinformation and the quote template arealready loaded into the system. All wehave to do is fill out the online formwith the specific project requirementsand push a button. The vendorinformation populates automatically.”—Interviewed Director, Creative ServicesSuccessful Strategies
  14. 14. 14Copyright © Best Practices®, LLC14Copyright © Best Practices®, LLCBest Practices, LLC is a research and consulting firm that conducts workbased on the simple yet profound principle that organizations can chart acourse to superior economic performance by studying the best businesspractices, operating tactics and winning strategies of world-classcompanies.Best Practices, LLC6350 Quadrangle Drive, Suite 200, Chapel Hill, NC Best Practices, LLCLink for Report: Marketing Excellence: Driving Costs Down & Effectiveness Up