Marketing Alignment

The meeting is now over.

You just spent two hours locked in a conference room with both your sales and marketing teams. And your frustration level reaches the red zone: whatever topic was discussed today, it felt like you just witnessed a ping-pong game. Lots of back-and-forth moves, with increasing spin as the exchanges progressed. In a way, it felt like business-as-usual; the interactions were similar to many exchanges of the recent past. But it also felt, well, wrong. 

Is the situation progressively getting out of control? Is it the predicament of complex organizations that their sales and marketing teams act according to the sibling rivalry bushido code? You need to know.

However, assessing whether the company must work on its marketing-sales alignment may prove to be a challenging task. 

There are several reasons for that. In a complex organization, this assessment requires the identification of pain points which span across two functional teams. It also relies on capturing both soft and hard metrics for plans, processes and people. A multi-dimensional exercise of sorts, whose undertaking may be tricky.

So to get you started, I’d like to propose some basic questions whose answers will help:

1. What is the frequency and the nature of communication between sales and marketing?  Here the combination of quantity and quality will give you an indication of the likely coordination between the teams.

2. Is there an alignment of purpose? Are the groups working together to achieve aligned objectives? The nature of the incentives, the degree of alignment, and the processes in place to set and review performance objectives is a great predictor of success or failure for the combined team.

3. How coordinated are the plans? I am sure you have experienced environments where the marketing plan had nothing to-do with the sales plan, and where account planning was merely a token effort, or even non-existent. What good can you expect from this?

4. What is the customer buying process? Understanding the steps that the customer follows in his/her buying experience enables the organization to align its resources along these steps, and to provide the right information at the right time. Not knowing, or having a different understanding, or knowing it without working it, are all factor which reduce the closing ratio.

5. Is there a clearly documented and stated value proposition? A competitively differentiated offer which meets the customer expectations? Which is fully understood and communicated by sales and marketing to their respective audiences? Dissonance in this area result in loss sales.

6. Does the company do debriefings or “post mortems”? Systematic debriefings following the closure of a deal, won or lost, are a great way for sales and marketing teams to learn from their mistakes and improve their cooperation for better results in the future.

7.  What is the average conversion-to-lead ratio? Do you know and track this measurement? It is a good indicator of cross-functional metrics and your company’s combined efficiency.

8.  What is the company’s average marketing cost per conversion ratio? Knowing this metrics implies that sales and marketing have worked together to understand both the cost-per-lead and the average conversion-to-lead ratio. A great indicator of cooperation across the party lines.

9. How many databases does the company uses to manage customer data? The least the better. When data is disparately distributed across functions, sales, marketing, customer service, channels, very little pro-active action can be taken that results in sales.

Try these questions. Ask them to your sales and marketing teams, cross-check their answers. And then, depending on what you find out, you may decide that you’d rather get your organization an alignment, rather than watch the next ping-pong game, however entertaining it may be.

Brands have always used promotional activities to develop relationship with their consumers.

They combine sweepstakes, rebates, coupons, promotions and loyalty programs to start conversations. The idea is that a special offer, attractive and limited in time, captures consumer information and establishes the first step in a positive and continuous relationship.

The reality is that this first step rarely goes anywhere.  If consumers love incentives, and willingly participate, they hate the “black hole” and the long wait to get their reward. Furthermore, most technology solutions, by relying on cumbersome mail-in claim forms automatically followed by unwanted emails, abuse the consumer’s trust. How many consumers actually shut-down communication with the brand, once they realize that the email or cell phone that they shared to receive a birthday discount or a loyalty card, is misused? The challenge gets more daunting as the costs of acquiring consumers keep on increasing. Making matters worse, most brands can’t reliably communicate with their consumers once acquired. On average, three-forth of consumers opt out of receiving marketing emails and twenty-five percent who opt-in are lost quarter to quarter due to change of address and email filters. It’s becoming increasingly apparent that email marketing alone does not work.The bottom line: brands need a new technology solution to deliver promotional programs that build true consumer loyalty by establishing a true conversation, at a reasonable cost. 

Such a solution must deliver a brand experience that combines the three key ingredients of instant consumer satisfaction:  

1. A Personalized Experience. Imagine a place where a typical consumer – let’s name her Mary - can find all of her information at her fingertips, a personalized and easily accessible web page.  On this page, Mary can easily access specific information about the products she own without needing to re-navigate the brand’s web site every time she visits. In fact, Mary is exposed to the brand continuously, in a personal and familiar way.
2. Consumer-Focused Interactions. Each new interaction is an opportunity to keep Mary’s information current, effortlessly. When she needs support for her product or wants to return it, extend her warranty, purchase an accessory, learn about new features, or share tips and tricks with other users, she finds information organized not around the product, but product information organized around her needs. Each one of these interactions is focused on Mary and engages her to naturally come back again and again. These interactions present her with opportunities to continue the conversation with the brand, on her own timetable.
3. More Than Control, Respect.  Give the consumer complete control of the process by being updated and kept informed, in a respectful and considerate fashion. There is no unsolicited email, no obnoxious advertising, and no sense of being pushed around. Mary is in charge. Information is relevant, special offers are targeted, social networks are personal.  In this context, both up-selling and cross-selling become possible. When Mary comes to check on the status of her promotion, or the branded social networks she belong to, she can see an additional offer or see the relevant offer from another partner brand. The ability to touch the consumer repetitively with relevant and meaningful offers, in a respectful fashion, gives brands a new way to powerfully market to the consumer community.  

And yes, built on this relationship, and ready to enhance it, the brand can propose loyalty programs and rewards. These programs will be perceived as a logical complement to the relationship. They will be monitoring an existing loyalty based upon a wonderful brand experience, instead of trying to establish a relationship in spite of it.

I was pondering the fate of most business alignment projects, such beautiful carriers, fragile vehicles for the hopes of many, and which seem to flirt dangerously with reefs, icebergs, and treacherous currents until they eventually reach the safety of the harbor.

That is, of course, if they don’t sink beforehand, which is unfortunately the fate of many well-intentioned ventures.

So, what makes sales/marketing alignment projects reach the ocean’s bottom, with no hope of return?

Blunder #1: Focus on the “soft” side of alignment.

How do we help marketing become more field-oriented? How do we train salespeople to be more strategically focused? Well, don’t waste too much time here. They know what they want and what they stand for, get them to work together instead.

 Blunder#2: Numbers and measurement, sure… but later.

How many leads are sales-ready? How many are converted? How much money is spent in generating leads? In qualifying them? What is the cost of misalignment? What is the ROI of specific marketing activities? The answers will get you very far… and enable you to figure out if you are progressing or not.

Blunder#3: ”Protect” top management from the mundane.

Like in all projects, this is a death sentence. If the EVP or Sales and Marketing and/or the CEO don’t signal the importance of this alignment project (i.e. on revenue and bottom lines) by their personal involvment, there is high probability that nobody else will follow.

Blunder#4: Focus on sales and marketing.

Surprising? Well, the whole point of this alignment exercise is to serve the prospects better, to get them to buy the services they need, by providing them the right value-add at the right-time in the purchase process. And also, to do the same after the sale, to retain them as customers. So, if the work is on sales and marketing, the focus is on the customer.

Blunder#5: Enroll in the project the people who are available.

In other terms, choose people who have free time and little influence to run your strategic initiative. Very soon your project will be tagged as “Irrelevant”. Instead, enroll your best and brightest, they are your leaders: they will make alignment work, and everybody else will follow.

Blunder#6: Keep it stealth until prime time.

The skunk way. Wrong. Communicate, communicate, communicate. The up, the downs, the thinkings, the feelings, the whereabouts. Start sharing the project to its various constituencies early on, so they can buy into it.

Blunder #7: Stay away from incentives.

Don’t mention them. It is politically touchy. Sales will scream. Marketing will argue. Without the right incentives, in full alignment, there is no aligned behavior. And without behavior, there are no results.

Blunder #8: Focus on the software.

After all, they now what they are doing, don’t they? Focusing on the tools takes attention away from the process, the objectives, the plans, the transitions, the consumer experience. The right software with the wrong process will not work.

Blunder #9: Roll when ready.

Why not!? Because it is likely that reality is very different from case scenarios and process maps. So pilot instead, to fine-tune the ship before getting to the high seas.

Blunder #10: Be happy.

Well, actually, this is a good idea. Celebrate! You deserve it. But once the first sales/marketing alignment is in place, the next job starts, monitoring and constantly improving. Like with your chiropractor, it never really stops.

Now that you know them, don’t go there… and good sailing!

I thought I was on the right track with Web 2.0.

After all I use a blog, wikis, I have a page on FaceBook. I have been helping companies deeply involved with delivering to consumers a personalized and interactive web experience as well as contextual content.

Well, it seems that the target is moving. The next new thing in interactivity, according to the New York Times, is called “predictive markets”.

Think a combination of Wall Street, London bookmaker and the ”idea box” of old.  

The best way to explain predictive markets is to share the Best Buy example detailed in Steve Lohr ’s  article. The retailer is planning to open its new retail store in Shanghai. Best Buy opens an exchange where employees, and in particular employees close to the action, can bet on the exact date they expect the opening to occur. Technology offers the betting engine (for more technology in action, check another application, Blue Bet more later on this, ) and the company a significant if not extravagant prize for the winner (and iPhone will do, thank you…)

What happens next? As we are getting closer to the date, employees who have inside information (issues negotiating contract with real estate agent, problems associated with furniture and decor, etc.) start betting the date will slip. This happens in such a proportion that the odds for an on-time opening visibly dive south.

Now management, who is closely monitoring the “market” jumps on the problem and pro-actively influences the outcome. The reality is that such an early warning system, weighted by market forces, worked well enough for Best Buy to win precious - and fairly expensive -weeks of operations. Would regular reporting have captured this trend? Maybe or maybe not, depending of the complexity of the problem, the management level at which the issues where occuring… and the filtering and wishful thinking that may occur in the middle management layer.

Imagine the applications linked with the business of alignment between engineering, marketing, sales and channels!

What about early warning signals for slip in launch dates: engineering issues? vendor problems? execution? What about forecasting: marketing inputs? sales optimism? channel logistics?

If the incentives are in place, and the market forces apply, lots of surprises can be avoided and lots of money can be made or reclaimed.

Of course, this is assuming that markets are “perfect” and that human psychology does not influence the outcome. In other words, that people bet on the likely outcome, and  do not try to anticipate judgement of the masses.

Which reminds me of a New York Times (again) cartoon depicting the Wall Street trading floor. We starting on the left of a group of traders shouting “buy!”, this shout mutates and swells in the middle into a “sell!” and transforms itself, as the wave recedes back, into a “buy!”, this rumor circle happening within the same small group. 

So, I guess I’ll have now to go back to my investment finance books to get up to speed with Web 2.1!

In a recent discussion with one of my high tech marketing client, I learned, to my astonishment, that his sales force was screaming for more ”advertising”.

This demand left me somewhat perplex.

Mind you, I am used to (un)reasonable requests from the field. After all, I was a sales rep and manager for many years, and I delivered a few of those myself. To my credit, my demands were always pitched with conviction, and while sometimes perceived as puzzling, they were never completely lacking of substance. 

But here, listening to my client, and taking the sales statement at face value, the demand felt preposterous.

We marketers know well that, if ads may generate some short-term sales advantages, they mostly benefit the company in building long-term awareness and brand preference, so what was this sales rant about?

Pushed by curiousity, I digged the topic a little more, and I got the full story. In fact, I discovered that the sales organization was really asking for more tangible support from marketing. The somewhat confusing and ambiguous equivalent of “GIVE US MORE LEADS, DARN IT!”.

Well, the lesson from this adventure in communication land is twofold.

First, let’s make sure we listen to sales (or marketing for that matter). Their statement is probably relevant, even when the listening exercise requires a good dose of patience, compassion and, oui, translation.  

Second, when they ask for marketing support, let’s make sure we give it. Maybe not in the form in which the request may be originally formulated. But with the appropriate answer to the problem at hand. Here, not with more ads, nor more leads, but ultimately with more “sales-ready, qualified and quality” leads; I am convinced that’s what they meant.

In sum, like with customers (and young kids), give them exactly what they need.

Of course, it is not always what they think they want… and that’s where some sales skills help!

One major problem facing retailers and manufacturers alike is the high and increasing cost of acquiring new consumers.

Source: Piper Jaffray & Co., 2006 market study of five channels for customer acquisition While search engines (mostly Google) increasingly lead the charge as the cost-effective and measurable solution to achieve this acquisition, the question remains: how to maintain a relationship with these individual consumers and how to keep them from going away during their next shopping search… With acquisition costs ramping, the answer to this question is the key to achieving a positive ROI.

The unfortunate reality is that most retailers and manufacturers have a hard time communicating with their customers once acquired. 

On average, three-forth of consumers opt out of receiving marketing emails and twenty-five percent who opt-in are lost quarter to quarter due to change of address, email filters, and anti-spam measures. It’s becoming increasingly apparent that email marketing alone does not work.

A new solution is needed.

This solution needs to be a private communication venue centered around the consumer data and experience. It could leverage email - or not ? -  using pre-approval, email confirmation, and peer-vouching.More importantly, it will have to be friendly, trustworthy, monitored (the bad guys will have to be kicked-out) and totally secure and private. Quite a tall order… I am quite sure that the next generation web2.0 is working on it as we speak!

In my past life, I was directly involved in the TiVo adventure, and the development of digital video recorder (DVR). TiVo changed my life and the life of million of americans, now able to record their movies and favorite shows, and view them at their convenience. I am pleased to see that now TiVo is licensing its software to many boxes and cable providers so that more than 30 million digitally connected families can enjoy this new freedom.

Yesterday, I discovered another very cool way to watch my favorite shows, and movies, when and where I want… on my laptop screen. Hulu launched a new service which enables us to watch TV series, clips or entire movies online.

Well, online movies existed before, of course. But honestly, none of the earlier products seemed ready for “prime time”: reaching beyond the video geek and enticing the unsophisticated consumer.

Hulu did a tremendous job at that, by eliminating the main barriers to democratization:

1.  Hulu is free (a good start, isn’t it?)

2. Its content is rich with series, clips and movies (Family Guy, 30 Rock, The Office, House, The Simpsons, Arrested Development, Aliens, Die Hard, Little Miss Sunshine, Napoleon Dynamite, etc.) from Fox, NBC Universal, Sony, Warner Bros., MGM, the NBA, Lionsgate, FX, E! Entertainment, Bravo, National Geographic, and USA Networks.

3. Its interface is simple and friendly, extremely clean and intuitive

4. The ads (because Hulu is ad based…) are short, unobtrusive and, believe it or not, relevant and entertaining. Most shows have one 15 second ad preceding them, and that’s it.

5. The quality. Even when my DSL becomes busy-busy, the video quality remains crisp in its small screen version, and very acceptable when on the larger screen, without frames freezing and other caching issues.

In sum, it ain’t a HD wall-like TV experience, but watch out.

Hulu maybe the next big thing in deploying content to the end-user. Provided their business model, which relies upon ads and DVD sales, delivers profitable growth.

In the meantime, I am going to enjoy the show! What about you? 

Brands have always used multiple promotional activities to initiate the relationship with consumers. And these many sweepstakes, rebates, coupons, promotions and rewards programs are used, time and time again, with more intensity than ever, to combine various incentives to get the conversation going between consumers and brands.

Most of these tools, marketing activities, and campaigns, use the favorable context of a special offer, attractive and limited in time, to capture consumer information. This original transaction is supposed to establish a positive and continuous relationship with consumers.

Unfortunately this first contact often does not go anywhere.

Consumers love incentives, and their participation level is usually high; however, they hate the sometimes complex process, the long wait that can be associated with getting their reward and the “black hole” between the time their first contact and the completion of the transaction.

On the retailer or manufacturer side, companies are challenged with implementing a promotion program that will be exciting and please consumers while increasing consumer loyalty at a reasonable cost.

This early tension often does not create a solid foundation for further interactions.

Most existing technologies, by relying on printed documents, cumbersome mailed-in claim forms followed by unwanted email and direct marketing initiatives, fail to deliver the long-lasting relationships and reciprocal loyalty that consumers, brands and retailers wanted in the first place.

How many consumers actually shut-down communication with the brands, once they realize that the email or cell phone that they shared to receive a birthday discount or a loyalty card, is used, misused and abused?

Loyalty starts by delivering value, consistently. So, let’s stop pretending with “loyalty” gadgets and let’s start the real loyalty game!

Over the last few weeks, I’ve met with a few clients who expressed their concerns about the softening of the economy and its potential impact on their financials.

It is clear that the “R” word is being uttered more frequently, in the press, and across all categories of economic actors from financiers to corporations. Most concerning, consumers themselves begin to worry.

However, as Brian Carroll points out in his blog “Fear Not“, this may be a great time of opportunities.

Yes, traditionally, marketing budget suffer during downtimes. Finance-driven organizations, and who is not finance driven? - review their budget feverishly and cut where they can, often activities whose ROI is less easy to measure. Often, advertising goes first, and promotions and more tactical areas (rebates, sweepstakes, promotions, coupons) follow suit. Hiring is frozen and the least alive wood is let go.

If History tells lessons, and I believe it does, market downturns can significantly benefit opportunists.

The day after the battle of Waterloo, Baron Rothschild, benefiting from the market panic that he caused by falsely leaking the news of Napoleon’s victory, found himself very well positioned to buy at a fairly discounted price, quite a significant amount of the depreciated assets resulting from the frantic sale.

Also, following Black Thursday of October 1929 and the resulting crash, John Piermont Morgan was able to come to the rescue and loan money to the other banks, which proved to be fairly good for the nation… and JP Morgan.

Finally, last week, JP Morgan Chase swallowed Bears Stearn for $2.00 a share, a hugely discounted price. 

Market downturns offer opportunities to the wise.

During economic lows, more revenues are needed. “Give me more sales” seems to be the motto, in order to compensate for a smaller pie. Sales people need more and better leads to compensate for a slower market. Result-driven activities benefit the organization twice; they happen when most competitors have cut their spending.

So, being contrarian gives an edge, as usual.

The great way to ”cut costs” is to focus on eliminating the value-destruction activities, processes and behaviors which create misalignment between sales and marketing. By working on connecting plans, processes and people, companies fare better, and position themselves for the better times. And, as History repeats itself, the difficult stretches usually last less than expected, leaving everybody scrambling to catch and surf the next wave.

Spring cleaning is in order, it’s a good seasonal practice, and a great recession activity.  Don’t miss this opportunity!

In his article “Why bother having a resume?” Seth Godin makes the very good point that ”great jobs, world class jobs, jobs people kill for… those jobs don’t get filled by people emailing in resumes. Ever.”

And he is quite right on the fact that most dream jobs are the result of networking and designing them in collaboration with the future employer.

That said, I don’t believe the great majority of job searchers can forget about their resume and rely only on “three extraordinary letters of recommendation from people the employer knows or respects? Or a sophisticated project they can see or touch? Or a reputation that precedes you? Or a blog that is so compelling and insightful that they have no choice but to follow up?”.

Why?

For two reasons:

1. The great majority of job searchers are probably not ”amazing or just plain spectacular”. If the majority of the professional population is unique, talented, focused, and good at what they do, this majority - by definition -may not be “spectacular”, or may not have the self-promotion skills needed for a contrarian approach.

2. By the same token, the great majority of companies are not progressive, enlightened, liberated and value-creation focused, even when they try. They follow their own internal rules and processes, and it’s likely that they ask for a resume and check the candidate references and background thoroughly.

So, to all job hunters, get stellar references, build a reputation, work your network, demonstrate excellence, build a killer blog… and write your resume, just in case!