Reinventing The Marketing Organization

Today was definitely a milestone in my career as a Forrester analyst - a piece of research was published that consumed most of my attention for the past four months.  It's a Big Idea piece called Reinventing The Marketing Organization.

What's a Big Idea?  In the words of Forrester's Head of NA Research Chris Mines, "Forrester Big Ideas bring clarity and shape to future markets, business
practices, and business models that are forged in the cauldron of
technology change."

The executive summary:

Today's marketing organizations are broken. Three out of four marketing
departments have reorganized in the past two years. Almost 80% of
marketers don't influence a critical customer interaction like customer
service, and 85% don't even own the "four Ps" of marketing anymore. To
regain effectiveness, marketers must transition to a Customer-Centric
Marketing Organization. Doing so requires: 1) redesigning P&Ls and
metrics; 2) shifting culture away from marketing communications; 3)
investing in a customer relationship infrastructure; and 4) rethinking
agency relationships.

I know this sounds high-level, but that's why it's called an executive summary!  The piece turned out to be a long one, running 23 pages with 8 figures and based on CMO/VP interviews, survey data, and other primary and secondary research.

One of my favorite concepts that ended up on the editing room floor:  the marketing mix is fine - tactics may change (e.g. branded entertainment or social computing) but strategic principles remain the same (e.g. relationship building and consumer engagement).  However, the traditional model needs to be expanded to incorporate a 5th "P":  Participation.

My next big piece will be related - Reinventing the Agency.  Please don't hesitate to get in touch if you have thoughts on the subject and would like to be included in the research.

I'd love to hear your thoughts on why there's much more talk than action today around being customer-centric.  Who's doing it well?  Who's not?  What will it take for marketers to add the 5th P into the marketing mix and reinvent their organizations?

Comments

re: Reinventing The Marketing Organization

PeterThis is great work. We are working on a marketing organization study of our own (our CEO, Bob Liodice wrote about this not too long ago: http://ana.blogs.com/liodice/2006/02/the_final_pilla.htmlThe executive who is leading this study will be posting a response to you on Monday.Regards, Will

re: Reinventing The Marketing Organization

Thanks Will - looking forward to hearing more.I enjoyed working with the ANA on our joint TV advertising survey earlier this year and perhaps we can put our heads together on organization as well.

re: Reinventing The Marketing Organization

Peter,I agree with the 4 main points you've outlined. I would also add that the marketing organization needs to re-think how they approach creativity, innovation and the teams that come up with today's "marketing" initiatives—which are blend of brand building, interactive experiences and ultimately meaningful time spent from the consumer perspective.A few related thoughts in this post off Logic + Emotion:http://darmano.typepad.com/logic_emotion/2006/06/advermarketing_.html

re: Reinventing The Marketing Organization

"My next big piece will be related - Reinventing the Agency"Peter, there will be many ways to reinvent the agency, and I hope that includes more accountability through some kind of Pay For Performance compensation option.I also believe that the search marketing agencies and the traditional ad agencies will merge their talents to reinvent a new kind of agency. It's already happening, but rarely very effectively from what I've read and heard at search marketing conferences. Anyway, here my blog post on the subject that I hope you find interesting.http://www.brokerblogger.com/brokerblogger/2006/03/consequences_of.html

re: Reinventing The Marketing Organization

Hi Bill,I think we will see the compensation models changing as the agency-client relationship evolves. For some glimpses into the future, check out Crispin Porter + Bogusky's arrangement with Haggar or General Mills with Campbell Mithun and Saatchi & Saatchi.Search will certainly gain greater importance as agencies integrate traditional and digital approaches. But new agencies will have to learn some old tricks, too - building a compelling brand is different than trying to reverse engineer a search algorithm. We'll end up meeting somewhere in the middle.

re: Reinventing The Marketing Organization

Excellent piece.I think its implicit in your article, but the new CCMO is marketing based on the customers' needs, not campaigns. The move to customer driven marketing has significant implications for supporting technology, with most customer preference databases aligned to deliver campaigns, direct mail etc. The need to deliver marketing messages at the right time, to the right customer is a differrent paradigm for marketing databases.Colinhttp://bankwatch.wordpress.com

re: Reinventing The Marketing Organization

Absolutely Colin. We talk about this shift for technology a lot in our view of the "Marketing Technology Backbone." Definitely critical for marketers to use technology to their advantage not only in the traditional direct sense, but in process optimization and right-brain activities as well.

re: Reinventing The Marketing Organization

Thanks. It's an excellent post. One of your points that CMOs needs to 'move away from the culture of marketing communications' is a key message. Customers deal with a company and not a department. CMOs need to co-opt every department that interacts with customers across the company.Agencies need to understand this shift in challenge for CMOs.Agencies still talk communication solutions. They should not talk 'campaigns' but focus on 'interactions' which means a whole new set of skill sets and competencies need to be built within agencies.