Owning Up To The Marketing Mix

Hi Marketing Leaders,

“Do less with more.” How’s that for a marching order from your CEO? Well, it’s a common phrase we hear every day from CMOs and marketing leaders. The Great Recession has created The Great Obsession with return on marketing investment.

My next report, “Owning Up To The Marketing Mix, focuses on marketing effectiveness and the increased accountability facing CMOs. The report guides CMOs on the value and limitations of marketing mix optimization. A former colleague and Forrester analyst, Julie Katz, who served Customer Intelligence managers, defined marketing mix modeling as:

>The process of using statistical analysis to estimate, optimize, and predict the impact of multichannel promotional tactics on future business revenue.

That is a great definition and highlights the scope (multichannel) and value (optimize and predict) of data-driven marketing allocation. During my interviews for this report, it is evident that marketing and media mix modeling have evolved as CMOs search for a more strategic tool to manage marketing as investment versus an expense

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Marketing Budgets Increase! Are You Allocating Wisely?

The economy is getting better, right? The answer is still not crystal clear. Yes, the DJIA topped 11,200 last week, but unemployment is still hovering near 10% in the US. The economy has reset expectations for all of us in our personal and professional lives. The idea of doing more with less is now a long-term business strategy versus a short-term mandate. Or is it?

Our data shows that marketing budgets are growing for many marketing leaders, but budgets may take years to return to “normal” (e.g. pre-Great Recession). We read every day in business journals about “the increased need for accountability in marketing.” CMOs have more measurable data and analytic tools today, but are we really making better strategic marketing investments?

In our February 2010 marketing leadership panel survey, we asked: Which of the following best describes your 2010 marketing budget compared to your 2009 marketing budget?

Most marketing leaders see steady or increasing marketing budgets. Thirty-seven percent state their budgets will increase in 2010 versus 2009. Another 35% of marketing leaders see budgets remaining the same as last year. The smallest percent -- 27% -- are working with reduced budgets.

Regardless of your budget situation, marketing leaders must continue the shift towards managing marketing as an investment versus an expense. CMOs will likely influence or own more technology budget as marketing shifts to digital and emerging media. Marketers are working more every day with IT and corporate finance on capital budgeting processes for new technology investments like listening platforms.

Two keys to success in this era of increased accountability are for CMOs to:

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Having Trouble Getting Organized? A Few Thoughts On Organizing For Marketing Today

I had the pleasure of participating in two CMO group discussions on marketing organizational structures in the past week. The Atlanta DMA focused on a recent Harvard Business Review article entitled "Rethinking Marketing For Tomorrow." The article suggests that value-based customer and brand management requires a reinvention of the marketing organizational structure. It's the common debate around product and brand-centric organizations versus customer-centric.

In addition, I facilitated the CMO group at Forrester's Marketing Forum today on "Organizing For Social Media." In February and March, I conducted 10 interviews with senior marketers including Best Buy, IBM, Louis Vuitton, and others about their current organizational design for social media. The CMO group discussed the challenges and best practices in organizing for social media.

The goods news…

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Another Loyalty Program? Damn right!

Hi Marketing Leaders,

I stopped by Office Depot yesterday to purchase some office supplies. While I was waiting (for an extremely long time), the representative asked if I was a member of their loyalty program called Worklife Rewards. It’s always an interesting question, and many times my answer is: “I think so.” I DO know I am a member of six frequent flyer clubs; seven hotel guest clubs; and several other retail loyalty programs.

Office Depot offered a free program with cash-back. Hey, it wasn’t another credit card – how bad could it be? I joined because I can easily see myself purchasing ink toner, paper and other supplies and getting a “kick-back” in the process – that’s future loyalty in a one-person sample of everyday life.

There are only two problems with loyalty programs as I see it:

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"Hello World!" and the impact on loyalty

Hi Marketing Leaders,

"Hello World!" is the well-known statement Tiger Woods used to introduce himself to professional golf in 1996. Since that introduction, Woods has become the biggest individual brand since Michael Jordan earning over $1 billion in total endorsement and tournament earnings. Now, the Woods' brand is tarnished due to his infidelity - yet the Woods' brand is resilient and customers are still loyal. According to Forbes' "Fab 40" list, the "Tiger Woods" brand still holds top spot among athletes with a brand value of $82 million.

What does this have to do with marketing leadership, Forrester and me..."the new guy"?

I officially joined the marketing leadership team yesterday. April Fool's Day is not the preferred starting date for any job, but I made it through without any surprises from HR or my new boss, David Cooperstein. In my new role, I am focusing on loyalty and customer value among other topics. I will explore how marketing leaders are evolving strategies around loyalty and customer value as social media and emerging brand platforms create opportunities & challenges.

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"Hello World!" and the impact on loyalty

Hi Marketing Leaders,

"Hello World!" is the well-known statement Tiger Woods used to introduce himself to professional golf in 1996. Since that introduction, Woods has become the biggest individual brand since Michael Jordan earning over $1 billion in total endorsement and tournament earnings. Now, the Woods' brand is tarnished due to his infidelity - yet the Woods' brand is resilient and customers are still loyal. According to Forbes' "Fab 40" list, the "Tiger Woods" brand still holds top spot among athletes with a brand value of $82 million.

What does this have to do with marketing leadership, Forrester and me..."the new guy"?

I officially joined the marketing leadership team yesterday. April Fool's Day is not the preferred starting date for any job, but I made it through without any surprises from HR or my new boss, David Cooperstein. In my new role, I am focusing on loyalty and customer value among other topics. I will explore how marketing leaders are evolving strategies around loyalty and customer value as social media and emerging brand platforms create opportunities & challenges.

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Your 2009 To-Do List

Chad Mitchell [Posted by Chad Mitchell]

My colleagues and I continue to receive questions from eBusiness managers about prioritization in 2009.

There are 3 common questions:

  • What should we do to survive and succeed?
  • What should we do first?
  • Does my priority list make sense?

Allstate is currently running an ad about getting "Back to Basics." The spot states that "after the fear subsides" people enjoy the small things such as home-cooked meals and time with family. "And the basics are good."

eBusiness and channel managers should follow this logic and focus on the fundamentals.

Here are my thoughts on getting back to the basics in 2009. Call it a honey-do list for eBusiness and channel managers:

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Help Consumers Find Your Best Content Online

Chad Mitchell [Posted by Chad Mitchell]

The Wall Street Journal published a great set of money saving tips on December 31st in the Personal Journal.  It reminded me of examples of other content on the Web helping consumers during the recession. 

eBusiness managers are using the Web to build customer advocacy.  My colleague, Bill Doyle, has written extensively on customer advocacy and its impact on companies during the economic crisis.  Bill’s theory is simple and smart: customer advocacy builds trust and leads to improved customer loyalty. 

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