Marketing Operations ROI:
Facilitate Customer-Focused Transformations
1

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About Your Guide: Gary M. Katz
• Founder and Chief Strategy Officer of Marketing
Operations Partners
• First ready-to-go COO and change management
team for the marketing department
• Chairman of Marketing Operations Future Forum
• 20+ years experience leading corporate marketing,
marcom, PR, IR, demand gen & change
management
• Certified Strategic Planning Process Facilitator (ICA)
• Noted educator, author, speaker and leader in
Marketing Operations field
• MS in Organization Development, BA in Public
Relations

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» Why is Measuring Marketing ROI so Freaking Difficult?
» Marketing Operations Maturity
• What it takes to get to Meaningful ROI
» Exercise: Measuring ROI – What’s Behind the Numbers
• Marketing Operations Mini Self-Assessment
» What is Marketing Operations 2.0?
• 1.0 vs. 2.0: What’s the difference?
• Six top marketing challenges and how MO tackles them
From a Marketing ROI Fantasy to a
Marketing Operations Mindset

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• Number reporting the use of ROI and profitability
metrics has remained steady since 2008
• Organizational pressure from senior
management is quite high
• Firms using ROI are more likely to report
expecting greater growth than competitors
• Firms reporting that they calculate ROI are 3
times more likely to report marketing as “highly
effective and efficient”
 Key Findings – 2009 Marketing ROI and Measurements Study
Source: 2009 Lenskold Group / MarketSphere Marketing ROI and
Measurements Study Available at www.lenskold.com.
Marketing ROI Tied to Effectiveness

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But There`s a Lot More to ROI than a Number

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Why is Measuring ROI So Difficult?
Metrics, Metrics, Too Many Metrics…

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 Revenue
 Profit
 Gross margin
 Market share
 Number of customers
 Stakeholder satisfaction
 Brand equity
 Distribution availability
External Measures
 Customer lifetime value
• Share of wallet
 Up-selling ÷ customers
 Cross-selling ÷ customers
 References ÷ customers
 Reference-driven new customers
 New customers ÷ average # of customers
 Lost customers ÷ avg # of customers
 Win-back customers ÷ avg # of customers
 % Dissatisfied, neutral, satisfied
 % customers who would rebuy
 % customers who would recommend brand
 % target market aware of brand
 % customers preferring brand
 Perceived quality vs. brand competitor
 % customers who know USP
Customer Management
 Awareness of goals
 Commitment to goals
 Resource adequacy
 Skill levels
 Freedom to fail
 Employee satisfaction
Internal Measures
Source: Used with permission: © 2008 ClearAction. All rights reserved.
Organizational

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 Revenue ÷ sales calls
 Costs ÷ sales calls
 Daily calls ÷ salesperson
 Sales call time ÷ contacts
 Entertainment cost ÷ sales calls
 Orders per 100 sales calls
 New customers per period
 Lost customers per period
 Sales force cost ÷ total sales
Sales Force Efficiency
 Cost ÷ 1K buyers reached per vehicle
 % Audience who remember an ad
 Opinions on ad's content & effectiveness
 Before-ad & after-ad brand attitudes
 Inquiries stimulated by an ad
 Costs ÷ inquiries
 CTR = click-through-rate
 Effective frequency or reach
Advertising Efficiency
 Logistics costs ÷ revenue
 % Orders filled correctly
 % On-time delivery
 % Error-free invoices issued
Distribution Efficiency
 Logistics costs ÷ revenue
 % Orders filled correctly
 % On-time delivery
 % Error-free invoices issued
Sales Promotion Efficiency
Efficiency
Source: Used with permission: © 2008 ClearAction. All rights reserved.

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[Valuew/Investment] - [Valuew/o Investment]
÷ Investment = ROI
 Benefits ÷ costs
 Includes non-cash benefits & costs
Return on Investment
{ [% Brand's U.S. sales in a region] ÷
[% U.S. population in the region] }
x 100 = BDI
 BDI = Brand Development Index
{ [% Category's U.S. sales in a region] ÷
[% U.S. population in the region] }
x 100 = CDI
 CDI = Category Development Index
Sales Potential
[Penetrated market ÷ target market]
 Customers = penetrated market
 Potential market: product interest
 Available market: interest + capability
 Served market: available mkt niche
Market Share
 Frequency = [Exposures ÷ Reach]
 GRP = [Reach x Frequency]
 CPM = [Ad Cost] ÷ [Subscribers ÷ 1K]
 GRP = gross rating points
= exposures
= gross impressions
 CPM = cost per thousand exposures
Advertising Potential
Performance
Source: Used with permission: © 2008 ClearAction. All rights reserved.

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• Program-to-people ratio =
•% program spend/ total Marketing spend
• Marketing productivity ratio =
•marketing program $/marketing employee
• Marketing budget ratio =
•% marketing budget/overall revenue
• Marketing investment change ratio =
•% increase or decrease YoY
Operational Efficiency
Functional
Source: Used with permission: © 2008 ClearAction. All rights reserved.

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Used with permission ©2008 Alex Eldemir
Performance
Management
Cause &
Effect
Accountability
ROI
What are You Measuring and Why ?

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• Measurable data in 2000
Metric
Data
Fine granularity needed for better decisions
Metric
Data
• Measurable data now
Information Overload

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Source: Courtesy of Aprimo, 2007
GIGO Dashboards

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Product Mgmt Marcom
Lead Gen
Social Media
PR
Channel MktgEvents
Web Alliances
Silos

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Misalignment with Enterprise Strategy?
• Enterprise
Strategic
Objectives
• Gap Closing
• Over some
period of time
• Objective #1
• Decisions &
Doing
• Investments
• Measures
• Programs
• Initiatives
• Activities
• Gaps to Close
•Priorities
•Leverage
•Now vs. Later
• Goals & Gaps
• Economic
• Experience
• Business
(Ethics,
Principles,
Values)
Alignment of
Stakeholders
with each
other
Balanced
Returns to
Each
Stakeholder
Maximum
Overall
Satisfaction
Success!
START

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7 Deadly Sins, Letterman-Style
• Your metrics for success are ill-defined
• Your people are slammed
• Your institutional memory is leaky
• Your innovation and creativity are suffering from constipation
• Your team, cross-functional or supplier relationships are poorly-
aligned
• Your decision-making process is tough to justify
• Your marketing portfolio is not delivering expected results

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• “I’ll just hire me one of them superstars”
• “If everyone just picks themselves up by their bootstraps (or works
smarter, etc)”
• “If we can just get some of that Marketing Automation, that will solve
our problems”
• “If we can’t quantify it, we shouldn’t do it”
• “I don’t care what it takes, just get it done”
• “We can’t spare a dime to invest in research”
• “We don’t have time to examine our own navels”
Myths Marketers (& Their Bosses) Gotta Stop Buying

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 Trusted Data and Actionable Insight
 A Clearly-Defined and Well-Aligned Strategy
 A Means to Mobilize People
 Processes to Manage the Chaos
 Metrics That Matter
 Technology to Aid Tracking, Measurement, Reporting
 In other words, a “Marketing Operations Mindset”
Behind the ROI

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What is Marketing Operations 2.0?

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Defining Marketing Operations 2.0
A Strategic Foundation for Marketing Excellence
A Holistic Framework
Alignment Integration
A Best Practice Enabler
Consistency Sustainability
An Operational Discipline
Efficiency Accountability
MO 1.0 MO 2.0
✓
✓
✓
✓
✓✓
✓✓

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Scaling for
Growth
Enterprise
Strategic
Agenda
Customer
Profitability
Buying
Acceleration
Accountability Alignment with
Stakeholders
Marketing
Intelligence
Marketing Operations: Sphere of Influence

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Lack of Confidence in
Business Intelligence
Challenge:
Converting Insight into Value
6 Top Marketing Challenges & How MO Tackles Them

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Lack of Confidence in
Business Intelligence
Benchmark Best
Practices
Validate
Market Demand
Assess
Insight/
Opportunity Gaps
Baseline What We
Know/What We
Don’t
MO Breeds
Actionable
Insight and
Innovation
Solution:
Converting Insight Into Value

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The Price of Acquiring & Keeping
a Customer is Growing
Challenge:
Maximizing Customer Profitability

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The Price of Acquiring &
Keeping
Customers is Growing
Calculate Customer
Lifetime Value
Capture Customer
Decision Drivers
Win Back
At-Risk Customers
Mobilize to
Meet Customer
Expectations
MO Delivers
Customer
Experience
Solution:
Maximizing Customer Profitability

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Every Strategy/Budget Cycle
-- a Free-for-All
Challenge:
Delivering the Strategic Agenda

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Catalyze
Shared Vision
Strategy / Budget Cycles
are Free-for-Alls
Ensure Message
Integrity
Live the
Brand
Socialize
Marketing Change
MO
Realizes
Strategy
Solution:
Delivering the Strategic Agenda

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No or Slow - Growth...
Disappointing Revenue Results
Challenge:
Accelerating Selling/Buying Process

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No or Slow Growth
Integrate
Buying/Selling
Cycle
Feed Sales Pipeline
Optimize Sales/
Marketing
Hand-offs
Leverage Loyalty
Assets
MO Aligns
Sales/
Marketing
Effort
Solution:
Accelerating Selling/Buying Process

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Marketing in Reaction Mode
Challenge:
Scaling Marketing for Growth

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Marketing in Reaction Mode
Diagnose Marketing
Health
Architect Enabling
Shared Processes
Optimize Marketing
Investment
Develop Marketing
Competency
MO
MObilizes
Resources
Solution:
Scaling Marketing for Growth

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Marketing on Defensive
to Show Contribution
“Much of what marketing can contribute right now is seen as less tangible
because we lack the metrics” – Dawn Hudson, CEO, Pepsi North America
Challenge:
Demonstrating Return on Marketing

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Marketing on
Defensive
To Show
Contribution
Align
Marketing/Enterprise
Objectives
Track Individual and
Team Performance
Fine-tune Forecasting
thru Predictive
Analytics
Define and Track Key
Metrics via
Dashboards
MO Enables
Account-
ability
Solution:
Demonstrating Return on Marketing

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Marketing Operations Maturity
What It Takes To Get To Meaningful ROI

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MetricsProcessGuidance
Infrastructure
Management
Technology
Strategy
Ecosystem
Alignment
A Model for Sustainable Success
Marketing Operations Best Practice Framework

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» With Sales
» With Enterprise Metrics
> 20%
CAGR
’03-’07
Strong
Brand
Identity
Execution
Excellence
Process
Excellence
» Budgeting
» Brand Management
» Customer Management
» Planning
» Product Lifecycle Management
» Predictive Analytics for Revenue
» Budget Planning Processes
Alignment
OutcomesFocus
Profile of MO Best Practices

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Fundamental MO
Expanded MO
Sophisticated MO
Budget Management
CRM
Marketing Services
Measurement
Vendor Management
The Roadmap to MO Maturity

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When Should You Invest in Marketing Ops?
Big Investment,
Heightened
Accountability
Dynamic
Competitive
Market
Need to Raise
Strategic
Game
Cross-functional
Alignment
Critical
Under
Media/
Regulatory
Scrutiny
M & A
Integration
Challenges
EXTERNAL DRIVERS VALUE DRIVERS MOBILIZATION DRIVERS

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Benefits of Mastering Marketing Ops

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Internal Transportation System: MO 2.0

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Highways, Roadways and Bridges . . .

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Means of Transportation

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Mechanics Tuning the Engine

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Driver`s Ed, Training & Licensing

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Driver`s Handbook

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Traffic Controls & Signals

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Navigational System

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Roadmap

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Alignment Specialist

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Source: ©2006 VisionEdge Marketing
More Meaningful Metrics

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Clients of ClearAction Continuum
PARTIAL LIST

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We center your business on customers
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ClearAction Advisory is different:
 Alignment internally & externally
 Empower all levels & functions
 Tie into existing rituals, strengths
 Seasoned CX practitioners
= Advisory team
See ClearAction.com/advisory
© 2018 ClearAction Continuum. All rights reserved.
DNA Master Plan™
(fast-track foundational mojo for CX leadership)
DNA Activation™
(all-hands-on-deck for CX)
Market Responsiveness Index™
(3 factors: 32% profit advantage)
DNA Transformation™
(cross-functional systematic CX)
Customer/Partner Engagement Optimization
(external & internal UX)
Human-Centered Design
(products, services, processes external & internal)
VoC Actionability
(external & internal UX)
Actionable Intelligence
(journeys, personas, lifetime value, metrics)

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ClearAction clients’ experiences
Because each of the ClearAction
team members managed CX in B2B
for a number of years, they provided
personal examples and practical
tools that could be implemented right
away. It was incredibly beneficial for
us to work with them for several
occasions. They elevated our
collective knowledge and helped us
achieve a higher level of CX maturity.
– A. Chu, Dir Customer Experience
ClearAction is an expert in business
operations, and has been an
invaluable resource for us to learn
best-practices in many areas. They
taught us things that would not
readily cross our minds, but after they
explain, it makes total sense, and this
increased our efficiency and
accuracy in many areas. I highly
recommend ClearAction.
– K. Van Diepen, Dir Marketing Communications
ClearAction has been at the forefront
of helping companies like ours
reduce chaos, maximize resources
and achieve impactful results.
They’ve provided mission-critical
guidance to begin the process of
building a strong marketing
operations function that supports our
company’s growth, scale and
continuous improvement objectives.
– K. Chalmers, Dir Marketing Operations

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We center your
business on customers
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company/201333
+ClearActionCXO
CustomerExperienceOptimization
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