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Archive for the ‘Marketing’ Category

Online marketing is under heavy pressure to be all things to a target market in the ways that market wants them to be—right now. Instant marketing, on-demand pressure and today’s culture of constant change impact not just the speed, but the quantity of content you need to create continuously to lift engagement.

There’s no downtime anymore. Create a campaign, send it out, monitor real-time results, tweak your strategy, add new content to your website, blog, create webinars, podcasts and compelling events that engage buyers. Oh, and don’t forget to give sales better conversational briefs, customer stories and buyer profiles that fit with those personas it took you painstaking hours to develop.

Whew. That’s a lot of stuff. If I’d have gotten more specific, it’d be really scary.

What can really be disconcerting is when you put all that content you’ve worked so hard on out there and then you look at the brief amount of time your buyers spend reading it. Scanning has become an art form. People grab a bit here, a bit there and try to give themselves a crash course in intelligence gathering that will enable them to make graduate-level decisions about complex sales with the equivalent of a fourth-grade education. Not because they don’t want to learn, but because time is scarce and the subject matter is not their expertise.

You need a strategy for putting all this work into a context that matches how your buyers access and use it. Not to mention your sales team.

Consider the following 6 contextual tips when developing your content and you’ll see your level of engagement lift because you’re matching buyers’ needs.

Pull:
The quality of your online content, and the way it’s presented can work for you or against you. Buyers have different informational needs at various stages of their purchase process. They will scan first to gauge relevancy. Once they decide you have information valuable to them, they’ll grab what they can now and return again to learn more. The returns are the critical objective. The more frequently you can touch them with high-value content, the more top-of-mind space your company will occupy. Think about pull in stages. The more meaningful touches they have with you, the more time they will allot for your content.

Time:
The scarcity of time that buyers have to pay attention means that you need to break things down. Address issues in bit-sized pieces they can digest quickly and easily. Showing respect for their time earns you points. Stage your content to grow longer as it gets deeper. Link it together so they can extend their time as they engage, but make sure they get full value from each piece. The secret of meeting time constraints is tight topic focus.

Conversation:
You’re not just talking to one buyer. Seven is probably the smallest number in a consensus group for a mid-sized B2B complex sale. Focus on developing content that’s easy for them to use in conversations with the others in the buying group. Storytelling, used in a business context, means that the buyer can actually envision themselves in the situation, eliminating the pain and moving successfully into the future. This gives them a context for discussion. Facts don’t generate conversation, situations do. Situations they can relate to.

Variety:
Everyone in the buying group won’t successfully integrate the same kind of content into their thinking. Some people respond better to video, some to audio, some to live presentation formats. Others want the words on a page so they can ingest as they expand their thinking to wrap their minds around the concepts.

Interaction:
Content is no longer just a one-way monologue where you do the telling and your buyer takes it all in and decides if they believe you. People want ownership. They want control and they want involvement. Listening, hearing and responding are critical components to incorporate with your content strategy. The dialogue needs to go both ways for it to be effective. Encouraging questions that explore your expertise can help drive interactions.

Immersion:
The better integrated your content is, the more immersion you will get. I call this topic density. Topic density means that you’ve successfully pulled your buyer from one related content resource to another, expanding their knowledge transfer to the point that they feel confident and competent in having a sales conversation with your company.

Applying these six tips to your content development will help you deliver marketing on the go that isn’t just hit and run. By varying the length of your information and tightening focus for bite-sized knowledge consumption, you’ll be laying the foundation for a lengthening engagement because the value they get quickly will entice them to spend more time. Just as a fine-dining experience begins with an appetizer, then a salad, an intermezzo, an entrée and then a dessert, so too can the stages of your content delivery build the momentum of your buyers’ engagement, ultimately resulting in opportunity lift.

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Once again I encountered a marketing person whose company does online marketing yet doesn’t have a Twitter component.

The marketing person said, “I’ve read about Twitter and have yet to see anyone say that Twitter can be effective for corporations.”

I don’t know what articles or blog posts he’s reading, but he should definitely expand his reading range.

I’ve already written in this column about the importance of monitoring your company/corporation on Twitter to ensure you can quickly respond to negative comments. And, of course, responding to positive comments can be equally beneficial.

But what about a corporation using Twitter effectively for B2B promotion?

Let’s take a hypothetical example – we’ll imagine that your company is about to bring out a new, improved inventory control software program in a crowded marketplace of inventory control software programs.

We’ll call the new software “Magic Inventory Control.” And the company could tweet about some of the new features that Magic Inventory Control will offer.

Of course, only every few company tweets will mention this software because the company doesn’t want to appear as only pushing its product on Twitter. Other tweets, for example, might share links to blog posts by inventory control experts or blog posts about software development, including what glitches to be on the alert for in new software.

Yet enough of the tweets mention Magic Inventory Control that the product name starts to become recognizable on Twitter.

Then the company runs a contest on Twitter for a free copy of this software. Anyone who tweets about the contest gets entered into the random drawing (using random.org to choose the winner).

Now excitement about this new product is building on Twitter and is poised to overflow into product blog posts and other social media (especially if the company uses an application that sends tweets automatically into Facebook).

At a very low marketing cost (whatever the opportunity cost is of employees taking a few minutes from their work each day to tweet based on a company Twitter strategic plan) the company has reached an influential online community without producing a single print, tv or radio ad for this product introduction.

The conclusion? The B2B marketing/promotion opportunities of Twitter are limited only by your company’s creativity IQ.

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There can be no doubt that the Internet has profoundly changed the way we communicate with each other, how fast we can access information and how easy it is to share news and connect.

The spread of traditional media, like newspapers, television and magazines has somewhat decreased but companies still need to be where their customers are now more so than ever. The exciting news is that there are numerous advantages to being online.

  • Cost effective: In small and medium sized businesses marketing budgets are usually small. Therefore, in order to squeeze the juice out of them, these budgets need to be used as cost effectively as possible. An eMarketing campaign can draw from the best of hardcopy documents such as direct-mail offers, newsletters and advertisements without spending the costs normally incurred in printing and posting them due to the fact that they can be sent electronically.

  • Targeted: Online marketing affords you the opportunity to customize specific messages for specific audiences. For example, a potential client is interested in one of your products but is not interested in any of the accompanying services that you offer. A well-planned online marketing campaign can meet that potential client’s interests exactly, the result being that you can give the right information to the right people and ultimately attract them to your business.

  • Time efficient: In business, time is money. eMarketing has the advantage of being faster to set up and implement than most other more traditional marketing methods. Similarly, the response mechanisms to the eMarketing tools are equally speedy. So you can expect to see results immediately.

  • Measurable: Online surveys and other interactive tools allow you to know how many people are visiting your website, what they looked at and how they heard about you. This is invaluable information that you can use in order to ascertain a better understanding of your customers and what they want from you.

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Changing the Culture to Achieve a Competitive Advantage

Many companies claim they are changing their culture but few actually succeed. Altera Corporation is among the few who have implemented a strategic culture change resulting in increased business success. The process that is used to transform the culture, Collaborative Transformational Leadership® is what differentiates a company like Altera, whose employees are passionate about and committed to change, from companies where change is only given lip service. Change does not occur just because someone is sent to a course or given a new process to implement. Change occurs because the entire organization, beginning with the leaders, is guided through a process that helps people at all levels reach outside their comfort zone and become engaged in making the company better.

Altera’s Situation

Historically, Altera’s business success was built on a strategy and culture of operational excellence. When the economy, their customers and the competitive landscape changed, this strategy no longer delivered the needed business results and they fell to second place in their market. To win market share, they needed to evolve their sales organization into one that could develop a closer more intimate relationship with their customers. Managers and front line sales people needed to be empowered to make decisions that fostered solid relationships with customers.

“Customer intimacy” was Altera’s vision for success and effectively implementing the vision would be a strategic advantage. The challenge, however, was how to create the environment inside the company that would enable customer intimacy and a winning mindset.

Collaborative Transformational Leadership®

Real culture change begins with the transformation of those who are leading the change. Success at Altera was achieved through Collaborative Transformational Leadership, an iterative process whereby those who lead the change are further transformed by their followers. As one level in the organization experiences change and expands their capabilities, they challenge the next level down to do the same, which in turn, challenges the leaders once again. In this way, the bar is continuously raised for leaders and followers alike. Collaborative Transformational Leadership ensures that the company is responsive to and in front of the demands of a fast-paced, ever changing environment.

Gaining Trust

Dan Sheehy, vice president of Eastern Area Sales, reviews the history of the culture change.

“As a company that has always driven towards operational excellence, we had a command and control culture. We paid people to execute, not to think about the business or the customers. To shift to customer intimacy required a culture of empowerment. We needed to develop a sales force that actively listened to and understood their customers. This required adding business acumen and relationship based competencies to a technically based culture.

“We began by communicating a vision of where we wanted to go. We provided training in a new sales process, but nothing substantive changed and the resistance was strong. I didn’t understand why. As I saw it, we were offering employees a better climate where they would be more empowered and more successful. At this point, I felt we needed an outside perspective to help affect change, so I brought in Germane Consulting to help me understand why things weren’t working, and what I needed to do.

“With Germane Consulting’s help, I began to appreciate the magnitude of what we were asking of our employees. Anne Perschel, president of Germane Consulting, helped me see that to achieve the change, people had to try new things and stop doing business the old way. Sounds easy, but the old way is what they knew, what they were comfortable with, and what made them and the company successful in the past. We were also taking down silos between units and power was shifting. Before key leaders, managers and employees would do this, we had to gain trust on two levels. First, they had to trust our competence as leaders. They had to believe that our vision was sound and if they followed us, we could reach it. Second, they had to trust that we cared enough to help them on the journey and that the company and everyone who worked here would have an opportunity to be successful.”

Becoming Emotionally Competent Leaders

The leaders at Altera had to become emotionally competent. They had to inspire, not just command. They had to read people better and respond to what motivates them. They needed to influence, not just direct. They needed to coach, collaborate and build teams. The first step in one’s transformation as a leader is to become self-aware and be open to seeing oneself as others do.

Germane Consulting worked with the leaders to help them become more self aware and develop the attitude and skills to effect change. A model of leadership and the required competencies to achieve the vision was developed. These competencies included:

  • Being self-aware;
  • Soliciting feedback;
  • Inspiring others;
  • Conveying a vision through story telling;
  • Reading the emotional landscape;
  • Influencing others;
  • Leading through empowerment;
  • Eliciting candor to identify and resolve obstacles.

Once the model was in place, Germane Consulting identified and administered a 360 degree assessment for each leader and then provided the appropriate coaching to develop the needed competencies. A 360 degree assessment enables leaders to develop self-awareness in order to be better able to see and address obstacles to success, understanding the impact they have on those around them and why. Germane Consulting worked with key leaders and managers in individual and small group settings. John Singleton, a sales manager remarked, “This has become a tight knit organization. There is no dodging the issues. It helps to have a resource like Germane Consulting to help you get things out in the open, to stop the dodging and to demystify what it takes to work on real issues.”

Another Sales Manager was not seeing the needed performance from his sales force. Past success led him to believe that people would follow him if convinced that his ideas would yield the desired business results. His people complained that he was driving his agenda so hard that he did not attend to their issues. Through a customized 360 process Germane Consulting helped him hear in-depth feedback about his impact. His guiding beliefs about people changed as he realized that people were only doing what was needed to comply with his demands. This was having a direct negative impact on results. Consultations focused on coaching and collaboration, while listening empathically to others. He began to hear and address people’s concerns. They responded in kind. He and his direct reports formed a leadership council. They shared ideas for implementing change and achieving results.  Within six months the district began to exceed expectations and have continued to do so over several quarters.  The tempo is upbeat. They have a winning mindset and everyone contributes. At their quarterly meetings it is difficult to tell who the formal” leaders are. It is a true team.

The Collaborative Transformation

In conjunction with the coaching, leaders and employees continued to receive intensive training in a new sales process. They learned how to work in teams, to listen to each other and to the customer, and to think like business people. They became empowered. But this change was hard work and management experienced substantial resistance. Employees complained that “it was easier when you just told us what to do.” But leaders held true to the vision and people began to achieve small successes.

With guidance from Germane Consulting, they implemented plans to support the change. They held celebrations to mark the victories of change from the old culture to the new and learning conferences where employee teams told successes stories and how they achieved them. People began to inspire and learn from each other.

Sales people and managers were also trained in the use of tools such as the Myers Briggs Type Inventory to help them understand their own and others’ personality types. Tools such as these, in conjunction with the coaching, help people increase their abilities to work with peers, direct reports, managers, and customers.

According to Dan, the tools and sales processes were necessary but not sufficient to change the culture. “Any company can bring in a sales process or train people to use tools like Myers Briggs to understand more about people. The key to making these changes work and have a lasting and substantive impact lies with the leadership, and that started with me. We had to show that we could be trusted, that we were vulnerable to the changes as well. We had to listen to what employees were saying. Germane Consulting was critical to helping us see the need to do this and to do it well. Without this, we would have ‘trained people’ but we would not have changed the culture.”

Altera’s empowered culture was now demanding more from their leaders: more collaboration, more teamwork, more room to make strategic decisions for their markets and territories. Leaders responded by listening to the demands. They also engaged Germane Consulting to help design a newly customized leadership assessment. Anne went to our constituents. Employees and peers helped identify the issues the leaders needed to understand in greater depth. They recommended people to be interviewed. They reviewed the feedback with their leaders and provided detailed stories to help managers and leaders learn. The transformation process was now mutual, internal and institutionalized.

Results

One success story is illustrated by a manager who prior to coaching, micro managed and stood in people’s way. He never heard the real truth about what was going on because people knew they would be micromanaged on the solutions. Now he is seen as one of the highest potential managers in the company. His people are empowered and creative. They are identifying opportunities and responding to them without being asked. He is engaged in very strategic thinking, predicting market trends and aligning sales strategies and organizations to take advantage of emerging factors. When asked how he developed his strategic thinking capabilities, he stated that prior to coaching, obstacles prevented him from knowing he had the capability to think about the big picture and see emerging patterns. Coaching helped him remove barriers from his own thought process and learn how to see emerging patterns of the future. His thinking is much clearer and more strategic. He has found new markets for Altera products and has redesigned his sales organization to align better with these emerging markets.

“Collaborative transformational leadership is now underway and continues to strengthen our organization,” says Dan. “We asked for change and we changed ourselves first. The employees then changed and demanded even more sophisticated and enlightened leadership. Best of all, our business results prove this is the way to win. We have gained significant market share and our pipeline of new business is strong; the industry’s most talented people are knocking on our doors looking for opportunities to work at Altera. Our employees are excited and they care about what they have created here. The ideas and the energy keep flowing.”

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1st Term in MBA is over. Results haven’t been out yet and the 2nd Term is about to start in less than a forthnight. It was definitely tough managing my time with a lot of sleepless nights.

Imagine, lots of days having to study beyond 2am and then waking up for work at 5:30am again. However, it was fun. Meeting new people, creating new friends and making new relationships was the plus.

So, what did I learn from my 1st Term?

Accounting for Decision Making really gave me a better insight of the need to quantify work, especially the activities that goes into creating product or services. However, upon my reading of Harvard Business School materials encouraged by the academia, I found that the current latest trend to this is to make it time driven. Hence, having a Time Driven Activity Based Costing approach is important as activities become more fluid and more time sensitive. And another plus skill that I came away with in this course is the ability to analyze a financial and operational standing of any listed company with the necessary financial analytical tools such as Dupont Analysis and Sustainable Growth Rate amongst others. The instructor for this course was Mr. Bob Gilliver, who incidentally is also the Program Manager for the MBA Program at the University of South Australia, Adelaide.

Creative and Accountable Marketing (what a mouthful) gave me a broader scope on how I can implement my marketing mix for the target markets I plan to expand my business or future endeavours into. To be creative and yet accountable in getting results from the marketing plans that I will chart out. The instructor for this course is Dr Eddie Phun, a Professor with UniTAR, Kuala Lumpur and also a Director of Maxbrand Consulting, a foremost expert in FMCG (Fast Moving Consumer Goods) and B2B (Business to Business) Brand Management in Malaysia.

On top of this, I’ve also been appointed as one of the Global Executive Press Officer for M2E (me2everyone plc, UK). After a lag of 21 years, I finally started to write again as a journalist. My 1st article has been submitted and have gone for editorial review. It has been routed for publication and should be out on the latest news (if you’re one of the over 500,000 members) at M2E.

If you haven’t joined and would like to join this cool new social portal that is amassing the collective creativity genius of its members, then click me to check it out. You too can become a shareholder of M2E for free; I have.

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So what has a meal got to do with venture management. Philosophically nothing and everything depending how you look at it. Twisted talk. No way.

Had a lunch meet yesterday with Julian Candiah, who was recently appointed as the Deputy General Manager I at Penang Development Corporation (PDC) by none other than Chief Minister of Penang, Lim Guan Eng.

img_2140Julian Candiah has had 14 years’ experience as a banker with various international banks. Chief Minister Lim Guan Eng hoped that with Julian Candiah’s expertise, the state government will be able to restructure its economy to benefit from globalisation trend when the world economy rebounds.

In the photo, Special advisor to the Chief Minister Julian Candiah (right) with Deputy Chief Minister (II) Prof Dr P Ramasamy (left) and Chief Minister Lim Guan Eng.

Julian graduated with a First Class honours Degree in Engineering and a Masters in Manufacturing Management from Cambridge University as a Cambridge Commonwealth Trust scholar.

Between 2000 and 2006, Julian was managing director at BNP Paribas. Prior to that he worked in London, Hong Kong and Singapore at various international investment banks such as Credit Suisse Financial Products, Bear Stearns, J.P. Morgan and Merrill Lynch.

His views on venture management was truly insightful. Julian noted that the success on an endeavor may be limited by the risk involvement that we take. To be successful here, one need to be able to commit to completion one’s business plans with the equatable stakes that one may lose if a failure happens.

But most of all, the art of negotiating and convincing investors to part with their wealth and ability to scrutinize the success levels of entrepreneurs and their project is the key to success. His advise was that if one does not have all the skill sets needed in this industry, it is crucial that one partners with another who has the needed skill set to make venture management a success.

This is not an easy industry to be in, but it is where all the money is.

We ended our conversation of old times and friends, our present career and venture management ideas over a final cup of coffee at Starbucks, compliments from him.

It was a memorable meal for me, as I found that I was in the presence of greatness. He had better composure than some of the C-Level managers that I’ve dealt with in local firms (business dealings) and those I’ve noticed ever so often in MNCs (in my career – day job).

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narasNaras Eechambadi is the General Manager of Quaero, a CSG solution. Quaero delivers multi-channel marketing solutions that help companies build long-lasting customer relationships and realize measurable return on investment. Eechambadi is the author of High Performance Marketing: Bringing Method to the Madness of Marketing (Kaplan Professional Press, 2005).

The old days when businesses took marketing spending on faith are over. But marketing doesn’t have to give up its finer side for the sake of accountability, argues Naras Eechambadi, author of the new book, High Performance Marketing: Bringing Method to the Madness of Marketing. CRMGuru.com founder Bob Thompson interviewed Eechambadi on Oct. 20, 2005, on the best ways to improve marketing performance. The following transcript was edited for clarity.

Bob Thompson
I’d like to welcome Naras Eechambadi, the CEO of Quaero Corp., to our Inside Scoop interview about his new book. It’s called High Performance Marketing. And the subtitle is quite interesting, Bringing Method to the Madness of Marketing. We’re going to chat with Naras about his book and some of his thoughts about marketing and how it relates to CRM. Naras, welcome.

Naras Eechambadi
Thank you, Bob.

Bob Thompson
Tell us a little bit about your background and what you’re doing at Quaero. What is the focus of your business?

Naras Eechambadi
Quaero’s been in existence for six years. I’ve been running it since I founded it in ’99. Prior to that, I was the senior vice president for knowledge-based marketing at First Union, which was a precursor company to what is today called Wachovia. And prior to that, I was with McKinsey and with BBDO New York. Essentially, I have been in the marketing business all of my professional life, which now spans almost 25 years.

With Quaero, itself, our mission is to help marketing departments and marketing organizations excel at what they do. Improving marketing performance is our mission, and we do that in a variety of ways but primarily by bringing information-based approaches to our clients and helping them not only think about how they can improve marketing but actually doing it for them.

Bob Thompson
That’s terrific. And by the way, thanks for all of your support on the guru panel for the last several years. I believe you were in the original group we started CRMGuru with back in January of 2000.

Naras Eechambadi
That’s right. It was soon after we started Quaero, and it’s been a pleasure. It’s been great being part of the panel, and I’ve learned a great deal from you and the rest of our colleagues there.

Bob Thompson
Let’s focus on your book, High Performance Marketing. Why did you write the book and who did you write it for?

Naras Eechambadi
Over the course of the last 25 years—but specifically, over the last three or four years—we have seen that marketing organizations are going through a very significant transformation from being organizations that are focused on outbound communications to being much more interactive with customers. But they’re also feeling a lot of pressure from inside their own organizations to be more accountable. People took marketing spending on faith. A lot of people spend money on marketing, out of either faith or fear. And that’s not sufficient, anymore.

Bob Thompson
It’s been almost like a black box, right? You put the money in and you hope something comes out, but you don’t know, exactly, what that was.

Naras Eechambadi
Exactly. And even when it does come out, sometimes you don’t know what you’ve got for it.

Bob Thompson
Like that old saying, “I know that I’m wasting half of my advertising dollars. I just don’t know which half”?

Accountability

Naras Eechambadi
That’s exactly right. That saying, Bob, is more than 110 years old. It was from the late 19th century and we’re now in the 21st century. I guess I would venture to say that, perhaps, it’s not half the advertising, anymore, but it’s still a very significant percentage. I think CFOs and CEOs simply don’t find that acceptable, any longer.

There’s a lot pf pressure for more accountability, and marketers are feeling the pressure from inside and outside. The book was intended to help them have a framework and a guideline to respond to this pressure. It’s a guidebook for how do you work your way out of this box and how do you, in fact, make marketing an operational discipline like supply chain management or something else?

Bob Thompson
Is this focused on the chief marketing officer or senior marketing executive?

Naras Eechambadi
Primarily, the senior marketing executive. But we also expect that it will sell with senior financial people: general managers, who have to approve marketing budgets and other people who work with marketing, such as people in customer service or people that are in sales or IT. These are all areas that interact heavily with marketing and are, sometimes, perplexed by what they see in marketing.

Bob Thompson
I liked your tagline for the book: Bringing Method to the Madness of Marketing. It seems like there’s a dichotomy in, at least, some facets of marketing. It’s a very creative process. You’re trying to build impressions. There’s a lot of the advertising and so forth. And then there are also very disciplined processes that go on. It just seems to me like this might be one of the big challenges in marketing, much like how you get an artist to practice Six Sigma. Do you find that’s one of the conflicts within the marketing organization, this creativity vs. discipline?

Naras Eechambadi
No. As a matter of fact, I don’t think it’s a conflict. There is a great quote in my book from Cathy Bessant, who is the chief marketing officer of Bank of America. She’s got a marketing budget that exceeds $1 billion. I interviewed her for the book, and she said, “World-class processes set you free.” What she means by that is that if you really have very disciplined processes and if you kind of know what you’re doing, then you actually free yourself up and you have more time to do the creative things.

Bob Thompson
So they’re not mutually exclusive. You can be creative and disciplined at the same time.

Naras Eechambadi
Absolutely. In fact, not only are they not mutually exclusive, we would say that the more disciplined you are, the more time you free up to be creative. In fact, the one helps the other.

Bob Thompson
Then, together, that’s part of what brings this high performance marketing to life.

Naras Eechambadi
Absolutely. Yeah.

Bob Thompson
What does improving marketing performance have to do with being successful in CRM?

Naras Eechambadi
One of the aspects of improving marketing performance in this day and age is the fact that so many channels of communication with customers or interaction with customers, more broadly, have become very interactive. Traditionally, marketing talked to the customer through television, radio, print, whatever. The new channels all allow the customers to talk back to the marketer; whereas, we know in our personal lives, listening can be a very hard skill. Marketing organizations, in particular, don’t listen very well.

Bob Thompson
They’re used to communicating out.

Naras Eechambadi
Exactly.

Bob Thompson
This is the message we want to deliver to the market and to influence what they do.

Naras Eechambadi
Exactly. But they are not very good at listening to what the customers have to say. The high performance marketing, a lot of this is about: How do you listen better? If customers talk and companies listen, everybody wins. The company wins, and the customers win.

Bob Thompson
In the studies that we’ve done of successful CRM programs, those that build their strategy around being customer-centric—which, by and large, means this listening process, getting customer input, both systematically through data and through interactions with customers—are more apt to be successful. So it certainly, makes sense to me.

Naras Eechambadi
Absolutely. But all of that has to happen through a central organization or be coordinated by a central organization. And marketing, in most organizations, is the best placed department to do that.

Strategy execution gap

Bob Thompson
Then let’s talk about this planning approach. You say that there is a strategy execution gap in companies. I don’t know if you could share whether you believe it’s most companies or some percentage, but to close this gap, what approach are you recommending to handle that?

Naras Eechambadi
I’ll share an example with you that’ll illustrate, I think, the larger point that I want to make. We had a client work with us about a year and a half ago. It was a large financial services company that had changed their strategy, significantly, after 9/11. When the market was collapsing and things were pretty bad in financial services, they decided, “Hey, we want to shift our strategy from acquiring lots of new customers, which is what we’ve done for the last 20 years, managing our existing relationships and growing our existing relationships. While we want to continue to acquire customers, that won’t be the primary focus, anymore.”

This was the stated strategy that had been communicated all over the company, including to marketing. But there was some frustration within the organization as to whether marketing was really in step with that. Marketing claimed to be in step with that strategy. Well, we went in and took a look at the entire marketing budget and ignored the usual budget line items telling you, “How much is PR? How much is advertising? How much is direct marketing?” and looked at it in terms of where the money is going. Is it being used to acquire or to cultivate existing customers? It became very clear that the bulk of the money was still being spent on advertising, which, largely, was an instrument for increasing awareness and acquiring new customers.

Bob Thompson
Right. And we’ve seen that trend, as well, in some studies that we’ve done, where loyalty programs are invested. There’s kind of this feeling like, “Yeah, we want customer loyalty. We want to retain them.” But the monies—two out of three dollars, at least—goes to acquisition.

Naras Eechambadi
Exactly. One reason is acquisition is easier to count. It’s easier to declare victory and move on. Building customer relationships is much harder work. So that is one example of a gap. What we are saying is, if you have a planning approach where you absolutely link what your strategic goals are to the things that you’re spending money on—and make sure that you can explain why it is that each budget item links to the strategy, the declared strategy—then you start to narrow that gap between strategy and execution.

Bob Thompson
Let’s talk about strategy for a second. It’s one of the most overused and abused words in business. What does strategy mean, in the context of marketing? What would be an example of a strategy, well stated and clearly understood vs. the sort of muddled versions that we tend to see in many companies? Do they really have a strategy to begin with?

Naras Eechambadi
To me, in plain English, strategy is about where you want to go. And what that means, in marketing terms, is as you’re growing a company, how do you want to grow it? Going back to this previous example, do you want to acquire new customers? If so, what kind of customers? Do you want to grow your relationships? If so, which relationships? Because you don’t want to really be trying to grow all of your relationships. You have to be focused about it.

Bob Thompson
So acquisition is really getting to the customer strategy.

Naras Eechambadi
That’s correct.

Bob Thompson
Growing. Retaining. And what flavors are going to be in the best interest of the company?

Naras Eechambadi
Absolutely. Marketing strategy and customer strategy are heavily interlinked.

Bob Thompson
In your experience, how often do, let’s say, medium to large companies have a clearly articulated marketing strategy that has this customer orientation?

Naras Eechambadi
I would say less than half the time the companies that we work have clearly articulated the strategy.

Bob Thompson
Is the first step, simply, to get a clear strategy developed and defined? And then you work on the execution and gap issue you mentioned?

Naras Eechambadi
Yes, it is, and just one additional thought on that. The strategy has to be really crisp and focused. Part of the strategy could be, what are you not going to do? Too many strategy statements are too broad and try to do too much, and they end up doing nothing.

Bob Thompson
Can you dig just slightly deeper into this process? I think everyone would agree that executing your strategy’s a good thing to do. But you have a specific methodology you have developed. Can you give us the highlights of how that process works? People who are interested in the details, of course, can read your new book.

Naras Eechambadi
Sure. We use what we call a six-dimensional performance framework for marketing. It starts with what we call “actionable strategies,” which means the very specific strategies. Then we say, if you want to execute those strategies, you need to have good measurements to know whether you are succeeding or not.

To get good measurements, you need good information about customers and about markets. And to get good information, you need solid technology that is functional. Also, to get to your goal and your strategic objectives, you need good processes, effective processes, that are very clear, so everybody knows what they’re doing. And then you need organizational alignment, which means that your people have the right skills, you have the right people, you have the right incentives and they’re all in the right boxes in the organization. All of those things need to come together for you to really execute superbly.

Bob Thompson
How long does it take a company to go through this process?

Naras Eechambadi
Anywhere from three months to three years. Then, of course, for the most part, it’s an ongoing thing. But what we, typically, do when we work with our clients, is to identify of these six dimensions—where is the weak link for that organization? Let’s fix the weak links, and then let’s focus on your strengths and build on your strengths because all organizations have one or two dimensions that they are strong on.

Weak links

Bob Thompson
You’ve mentioned some things that, to me, sound very much like CRM-type issues when you talk about processes, organizational alignment, metrics and, of course, the strategy, to begin with. These are all things that CRM programs worry about in a larger sense, whether it’s service-related or sales. I wonder if you have a comment on where the weak link is. Does it tend to be that they have a strategy but don’t know how to measure their progress? The measurement metrics are not there. The organization’s not on board. Is there any sort of common theme that you see more often than another?

Naras Eechambadi
Yeah, I would say the three areas where most companies really fall short are measurements, processes and the organizational alignment. Of the six areas, those three are usually the weakest links. Unfortunately, most companies tend to spend time on the other three areas, which are strategy, information and technology.

Bob Thompson
So we know where we want to go and we can figure that out. Then we can go buy tools, and we know what information the tools can deliver. But it’s getting it implemented in the organization; the work processes; figuring out how to actually create and use the metrics; getting the people to do all of what they need to do.

Naras Eechambadi
Or getting the right people.

Bob Thompson
Yeah.

Naras Eechambadi
Those are all difficult things, and too many organizations like to avoid them, if they can.

Bob Thompson
These problem areas seem to be areas where the leadership of the marketing organization is extremely important. I notice that one of the things you’ve said in your book is that it’s very important to have a decisive marketing leader. Can you share an example of a company where you feel the leadership really made such a huge difference?

Naras Eechambadi
Yes. I think I would point out a couple of different companies that have had tremendous leadership in marketing, especially in terms of process. One is a financial company that has done a tremendous job on the marketing measurement and process front and bringing things together, to the point where marketing is now seen as a leader of all customer-related activities in the organization, which was not the case a couple of years ago. They’ve really done a very good job.

Bob Thompson
Is it due to a new leader coming in and making these changes?

Naras Eechambadi
No, it was an existing leader who reacted very positively to the pressure coming from the CEO’s office that said, “Hey, you guys really have to show us what it is we’re getting for all the money we are spending.”

Rather than just coming back with a simple ROI kind of thing, these guys actually stepped back and said, “Let’s look at the entire framework and what we are doing here.” They completely turned the organization upside down. It was internal leadership. They just completely stepped out of their comfort zone and were able to achieve some remarkable results.

Bob Thompson
It sounds like the impetus for this came from the CEO, and that, in many cases, may also be important. Isn’t this part of the accountability issue that you’ve been talking about, that CMOs are going to be accountable to the CEO and to the board to actually make sure that these marketing investments are delivering a return?

Naras Eechambadi
Absolutely. That’s exactly the case. I don’t know if you are familiar with this, Bob, but of all the C-level executives in large corporations in the U.S., CMOs have the shortest tenure.

Bob Thompson
What is the tenure?

Naras Eechambadi
Typical tenure of a CMO is less than 24 months, it’s about 23 months.

Bob Thompson
Wow.

Naras Eechambadi
Less than two years.

Bob Thompson
So they’re competing with CIOs for their careers.

Naras Eechambadi
Yeah. Interestingly enough, for CIOs, the average tenure is 36 months.

Bob Thompson
Is that right?

Naras Eechambadi
So CMOs are significantly less long-lasting than CIOs, and it’s partly because they are not able to prove their effectiveness.

Bob Thompson
Let’s talk about the role of technology, because we know that strategy in these other software areas are the most difficult. It seems like everyone has a fascination with what the tools can do. From what I’ve seen, the marketing tools, especially in the analytics area, can do some fabulous things that you just could not do without technology. Could you highlight a couple of areas where you feel that the technology has enormous leverage in improving marketing performance?

Naras Eechambadi
Absolutely. Technology is integral. It’s a foundation for the high-performance marketing organizations. There are three specific areas that can help marketing organizations be successful. The first is just having the right information, whether it’s market information, comparative information or customer information. The second is having it all be clean, accurate, timely and available in a database of some sort. The third is having the right applications to leverage it.

There are three applications I’d like to mention. One is campaign management applications that allow you to dialogue with your customer on a regular basis, whether it’s through direct mail, email or the web. The second is business intelligence kinds of applications that allow you to understand what’s happening out in the marketplace and get reports out to all of the operating managers, so they can make better decisions. And third, data mining kind of applications that allow you to go in and mine the information so that you can figure out what your next strategy ought to be or how your tactics ought to evolve over time.

Bob Thompson
Could you give us a word of advice for an executive—a CMO, I would presume—who says, “I need to improve marketing performance. In fact, I need to do it or I’m going to be looking for a new job”? What would you tell that executive?

Naras Eechambadi
The advice I would give is, take a look at those six dimensions and make an honest assessment of where you and your company and your department stand relative to each of those dimensions. Then first focus on shoring up your initial weaknesses. Then, try to build on your strengths. I don’t want to make a plug for my company, here, Bob, but we do have a tool that allows our clients to do that in a very objective way. But many of your leaders could, certainly, do that on their own. It’s a little bit more difficult, but they need to make the attempt. That’s the first step. Understanding where you stand is the first step to figuring out where you want to go or how to get to where you want to go.

Bob Thompson
Naras, thank you very much. That’s great advice. And congratulations on getting your book out. I know that’s a tremendous amount of work. I appreciate your sharing some thoughts with us today on this Inside Scoop program.

Naras Eechambadi
It’s been my pleasure, and thank you for having me.

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