January 21, 2014

Data, collaboration and singing off the same song sheet

I often hear "data-driven decision making" cited as a desired tenet of a company's culture. And we all also know that every person on today's marketing teams need to know their way around a spreadsheet (What kind of marketer are you?).

But how do you make being data driven a reality? First, everyone needs to be singing off the same song sheet. Literally.

One song sheet builds a common vocabulary
Ok, I don't mean the team is literally singing, but I do mean using one common dashboard. At minimum, a weekly document tracking the critical business metrics plus the associated driver metrics. And where all sources are clearly articulated and calculated or derived values are clearly defined.

Having one "song sheet" that everyone uses insures that a common vocabulary is used across the business. This is essential for needed alignment across cross functional teams comprising finance, marketing, product, sales and support team members.

Whenever I start a new assignment, this is one of the first things I tackle. And having done this a number of times now, I am no longer surprised when the effort inevitably uncovers a misalignment. It can be as small as a misunderstanding over the definition of a conversion rate or as large as inaccurate source data. In my experience, it has even highlighted executive dissonance around what precisely is the most important business metric: new sales growth, profitability, revenue or acquisition costs?

And, always, there are team members who privately admit to me that they had not previously known what the critical business metrics were nor understood how metrics were sourced, calculated or forecast. Employee engagement increases when individuals understand and can articulate how what they do contributes to the overall success of the business. Creating a common metric dashboard is worth the effort just for the impact to increased engagement alone.

How do you get to Carnegie Hall? practice, practice, practice
It's not enough to simply have a common song sheet, everyone has to know how to sing off it. And that takes practice. It will take multiple repetitions and review before your entire team is consistently fluent with the data, its trends and how this knowledge and insight applies to the work they do and decisions they make each day.

I like to establish a regular time each week with the team to review the metrics, current trends, share insights and any planned actions. The regularity and repetition helps the entire team start to understand and internalize the rhythm of the business. And as programs and products launch and/or optimizations are tested, the impact is seen in the metrics. And through regular conversations around this cause and effect, the team learns the activities that positively impact the critical metrics and begin to apply that knowledge in their day-to-day prioritization and decision making.

It's a process, not an event
Create a "song sheet" and "sing" off it doesn't sound like rocket science and it isn't. But you may be surprised about how many organizations say they want to be data driven, but don't take the steps to enable team leads and team members with the tools they need. And a key element of success is repetition and creating a routine around the review of the metrics. Building a data driven competency is process, not an event. And it's well worth the time invested.

January 15, 2014

What kind of marketer are you?

"What kind of marketer are you?"

It's a great question and, coincidentally, over the past few months, I was asked this question a lot by different start up executives at various events. I am happy to be hearing the question more regularly because it demonstrates an increased understanding about the breadth of the marketing discipline and differences among marketing professionals. 

We know that the most effective marketing teams require a wide range of talent to effectively address the revenue and growth needs of each of our unique businesses. And while every marketer needs to be data driven, you must not hyper-focus solely on optimization or you will lose sight of the forest for the trees.

Who do you need on the team?

This fun infographic summarizes some marketing roles (personas) that are on today's best marketing teams: a web designer/developer, a content creator, a technologist, an analyst and a campaign manager. In addition, every well-stocked marketing team also needs professionals focused on user insights, branding/positioning and as well as on pricing and packaging. And depending on your business, you may also need marketers focused on sales readiness and programs for upsell and activation.

Effective marketing leaders are able to align all of these different specialists around one integrated marketing strategy. Of course each marketing leader has his/her unique strengths, weaknesses, blind spots and areas of genius and these are informed by both her inherent DNA and his unique path to leadership. Some, like me, "come up" through quantitative acquisition marketing with its analytic rigor while others "come up" through branding or PR or creative tracks.

Regardless of how any one leader starts their marketing career, in order to be effective in today's marketing environment, they must understand and appreciate how each specialty works and how each complements the other. Without this understanding and appreciation, a leader runs the risk of crafting and executing a lopsided strategy.

And business priorities can and will change from year to year. Today's marketing teams must be flexible and, potentially, virtual. Marketing teams need to stay nimble and be constantly skating to where the puck is going to be (Wayne Gretzky). I prefer to lean on consultants and agencies for critical, specialized activities and hire marketing professionals who can strategize, manage and lead multiple activities and only those functions where we need to own that core marketing competency in the long term. But these kinds of decisions are specific to each business.

Leaders think beyond their specialty.
For those up and coming marketing-leaders-in-the-making, my advice is to find ways to extend your horizons beyond your current specialty. Talk with your current manager and find external mentors. Find opportunities to spend time with other marketing specialists on your team and learn from them. Lay the groundwork now because this insight and experience will be necessary when you're running the show one day!

January 2, 2014

What you miss when you hyper-focus on optimization

Lately, I fear some marketing leaders may be losing sight of the forest for the trees. They are veering too far toward the sole goal of cost-optimization and moving further away from the business goal of driving demand and increasing revenue.

For all of the right reasons we got closer to our CFO's and learned how to justify our budgets through achieving ever-lower CPL's (cost per lead) and CPA's (cost per acquisition). We fell in love with A/B testing our copy, creative and landing pages in order to squeeze another point or two out of a conversion rate. We hired analysts and learned how to manipulate pivot tables with the best of them.

And as fun as data analytics can be (and I am one big geek...), it is dangerous when the value of marketing is seen to be in the act of optimization...not in driving demand. Adam Needles from Annuitas recently wrote a blog, "Is the CMO the problem?" and characterizes the problem as, "CMOs obsess about their marketing ROI; however they focus on activities and their costs, not on demand and revenue."

Don't get me wrong because optimization is my middle name (see geek reference above). Closely watching acquisition and retention metrics and managing costs is a necessary part of marketing program execution. However, it is necessary, but not sufficient.

Optimization is a tactic, not the strategy.

Given pressure to justify marketing budgets and departments, some marketing leaders have over-corrected and lost sight of their role to provide the customer insight driven strategy needed to create and sustain long term growth.

To combat this, I second the suggestion from the McKinsey & Co blog "Why can't we be friends" that the CMO and CFO collaborate to identify marketing's success metrics to ensure the set addresses both the short term and the long term health of the business. Short term metrics will be primarily financial: new sales, reduced churn, and customer acquisition costs to name just a few. While long term metrics may include: brand awareness & consideration and Net Promoter Scores.

I didn't say it would be easy.

The conversation with your CFO to get agreement on short and long term marketing success metrics may not be easy. We all know that many CEOs and CFOs can be biased to be focused on the short term financial metrics. It is marketing's job to continually bring the long term view into the conversations. Getting consensus will solidify the wider value the marketing team provides and will facilitate the necessary conversations around the investment needed to sustain revenue growth, not just short term cost optimizations. 

If one of your 2014 New Year resolutions is to build a better relationship with your CFO, getting to a common set of both short term and long term metrics is a great way to start.