Performance Marketing

Marketing performance should be judged by impact, not by look and feel. Most people would agree with this statement, yet marketing is too often judged primarily by how funny, cute, creative or slick it looks. Unfortunate, because that’s like measuring the effectiveness of a factory based on beautiful landscaping and a clean break room!  Your marketing efforts deserve more respect. I’d like to share 7 critical success factors for creating an environment that’s focused on improving real marketing performance. Here are the first 3 factors:

1. The right mindset. You must believe that marketing is strategically important to your organization’s success and that marketing performance can be improved with effort.  Organizations that consider marketing to be trivial, or a mysterious force that defies logic and reason, won’t be motivated to invest the time, effort or resources to get measurably better at it.

2. Measure the right stuff.  It’s not enough to measure marketing performance solely by sales revenue.  Revenue is a happy result, but it’s not a leading performance indicator.  A revenue increase doesn’t necessarily mean you are getting better at marketing. There are too many variables that drive revenue and a lot of them are completely out of the marketing manager’s control – at least in the short-term.

To improve at nearly anything, you have to study the controllable variables that drive results. Professional baseball teams don’t just track wins – they carefully measure progress in improving the controllable skills that CAUSE wins. Players and coaches know that if they can become better at controllable skills, like hitting, fielding and pitching, more wins will follow.   From a motivation standpoint, think of the difference between coaching players to become better hitters (specific and inspiring) vs. coaching the same players to become better game-winners (vague and frustrating).

Regardless of the organization, marketing performance boils down to doing 3 basic things well and efficiently: 1) turning potential buyers into prospects, 2) converting prospects into customers and 3) turning customers into advocates.  Measurably improving performance at doing one or more of these 3 things will certainly drive sales revenue.

3. Organize marketing activities into campaigns. Campaigns are to marketing what projects are to engineering and what budgets are to accounting. Campaigns organize marketing activities into manageable units with defined objectives, time frames and measurable impact. Nearly any marketing activity worth doing should be managed as a campaign so its impact can be evaluated and performance can be improved over time.  I’m sure you’ve witnessed the alternative – it’s a mish-mash of frenzied marketing activity with no time frame and no clue as to which activities are actually making an impact.

4. Make responsibility for improving performance personal.  Assign each marketing performance metric a formal owner – one person that will be ultimately accountable for its success, even if others contribute, as well.  Without clear ownership of performance metrics, marketing managers often begin measuring their performance by the length of their task lists – instead of results.

5. Make performance goals and results visible outside the marketing department.  Be bold and explicit about stating marketing’s goals and results.  Marketing objectives may not be as obvious as those of other departments, so make the extra effort to communicate them to the rest of the organization.  If a key performance goal is to achieve 80% brand awareness and the current state is 60% awareness, make sure the entire organization knows it!  How else can they help marketing grow the business?

6. Harness the competitive spirit.  Everyone in your organization needs to know exactly who your strategic competitors are and who’s winning.  To get folks excited, there’s nothing like looking the competition in the eye and squaring off.  The thrill of victory and the sting of defeat are very motivating, but neither are possible without defined adversaries and a visible scoreboard.

7. Measure behavior, not opinion.  Opinion is nice, but behavior is usually more accurate. Whenever possible, measure what customers and prospects DO, not what they SAY.  For example, instead of relying solely on surveys to measure satisfaction, track actual behaviors like product returns, repeat purchases or referrals.  Or, when gauging intent to purchase, use in-market tests, not surveys.  Looks for ways to creatively build behavior-based performance measurements into your marketing processes.

Really, these success factors probably apply to improving the performance of nearly any activity – not just marketing.  However, they are especially critical for marketing because so many organizations treat marketing like it is exempt from the disciplines that drive performance improvement. That fallacy leads to low-performance marketing.

Implementing these success factors will have longer-term, mutually-reinforcing benefits, too. Your organization will attract better marketing talent because high-performers generally WANT to have their performance measured and to be accountable for results.  Also, when marketing goals are understood and results are measured, the entire organization will be more likely to offer support to the marketing team.

Don’t settle for low-performance marketing!

Make Nimble Decisions

A major part of a product manager’s day-to-day work is making smart decisions in situations that fall outside of normal policy.  You know – those pesky decisions that come to you because no one else can (or will) make them.  Requests for price discounts, special trade programs, product customization, customer service accommodations, product returns, etc. – these exceptions ultimately come to you, the product leader, because they aren’t covered by somebody else’s standard operating procedures.  These odd-ball requests can be really frustrating and time consuming.

Many managers make the mistake of treating all decision requests the same. They try to create elaborate policies and procedures in the hope of covering all possible situations.  That’s a mistake – you simply can’t hope to design standard processes that effectively cover every possible contingency.  It’s better to separate decisions into 2 types: routine and non-routine.  Then you can design specific processes to efficiently and successfully manage them separately.  Here’s what you do:

First, make sure you have solid standard operating procedures for dealing with 95% of the decisions that employees routinely make.  If you don’t have effective SOPs in place, EVERYTHING is an exception.

Second, flexibility is the key to being nimble with the remaining 5% of non-routine decision requests.  For these requests, create a simple, one-page document that asks for the basic information needed to make a decision and execute it effectively.  The document simply asks the requester to provide answers to:

1. What exactly is being requested?

2. What are the expected benefits of saying “Yes”?

3. What are the expected the costs of saying “Yes”?  Will the costs be incurred in stages?

4. Who is being asked to make the decision?  Who needs to be informed of the decision?

5. Regardless of whether the decision is “Yes” or “No” – who will be responsible for leading the next steps?

Super simple stuff.  But a lack of basic clarity around these 5 points is usually what slows down decisions and responsiveness.  None of this information needs to be incredibly detailed to make a good decision.  The level of detail will vary depending on the situation.

In the beginning, employees may balk at having to document their exception requests, but I know from experience that the 30 minutes devoted to thinking through and documenting the 5 points above can literally save days or weeks in execution.  It’s no secret that clear requests with clear approvals tend to get resolved a lot more effectively than vague requests with uncertain support.

In the end, your decision-making will be more nimble.  Customers will like your quick response.  Your co-workers will like your clear direction.  Everybody wins.

Help Prevent Fluffy Marketing

Marketing often gets a bad rap for being “fluffy” – especially from those in fields that tend to be viewed as more objective like operations, engineering or accounting.   Even if no harm is meant, this “marketing is fluff” attitude will hold back an organization’s success.   People just aren’t going to put their very best efforts into supporting marketing activities they don’t fully believe in.

I’ve been fortunate to work at several companies where marketing was taken very seriously across the company.  These companies did specific things that made marketing feel REAL (not fluffy) to all employees.  Based on my experiences, here are a few things that will make marketing more REAL for everyone:

1. The marketing department must have clearly defined responsibilities with specific, measurable goals.  This seems way too obvious – but, for some reason, many marketing departments escape from having even minimal levels of accountability.  I don’t understand why this is tolerated.  Not only does a lack of accountability perpetuate the attitude that marketing is fluff, it also keeps the best people out of marketing.  Highly capable employees are not attracted to nebulous jobs where performance isn’t accurately measured and appropriately rewarded.  Talented marketing managers with clear accountability will go a long way toward earning respect for marketing – inside and outside the department.

2. Analyze the true cause and effect impact of marketing actions.  Don’t let the only measures of marketing performance be top-line revenue and opinions about the look and feel of advertising.  That’s like managing a baseball team by correlating the number of runs scored with the color of the players’ uniforms.  Marketing feels REAL when the organization has confidence in activities that truly drive results.  Be serious about measuring and analyzing REAL customer behavior, not just opinions.  It’s hard work, but worthwhile.  Without knowledge of, and confidence in, true cause and effect relationships, an organization is doomed to chasing the marketing gimmick-of-the-month.

3. Harness the competitive spirit.   Competition is a powerful motivator.  Be honest and vocal (internally, at least) about how your organization is doing against the competition.  If you’re losing market-share, don’t sugarcoat it or hide it from employees.  Make sure everybody – not just marketing – knows it and knows what they can do to change things.  Also, don’t confine commercial success to only the marketing department.  When all employees experience both the thrill of victory and the agony of defeat, marketing feels REAL and the organization will naturally move toward activities that generate more wins.

4. Passionately respect deadlines.  Whatever your key performance drivers are, implement them against a schedule of deadlines like your life depends on it.  Otherwise, it’s easy for marketing activities to drift.   If new product features are a critical driver of sales, set hard goals to release new features on a regular basis – annually, quarterly, monthly – whatever makes sense in your market.

I learned the power of REAL deadlines when I was in charge of marketing seasonal products like snowthrowers at Toro.  If we missed a deadline for a feature introduction, we were out of the game for at least a year.  That’s REAL and powerful motivation!  If you don’t have a seasonal product to create a sense of urgency, anchor your deadlines to other REAL events, like trade shows or annual price sheet releases.

5. Encourage frequent customer interaction by all employees.  Don’t let sales and marketing horde the customer experience.  The more interaction all employees have with customers, the more REAL customers will become.  Customer visits, sales calls, trade shows, customer training – these are all opportunities for employees outside of marketing and sales to develop a sense that customers are REAL – not just some vague demographic made up by the marketing department.

Recognize that most people outside of marketing are predisposed to believe that marketing is fluffy.  Therefore, a marketing department has to work doubly hard to feel REAL to the rest of the organization.    Implementing the processes and disciplines above will help make marketing more REAL – to everybody.