What the heck is going on with marketing anyway?
Marketing discussions lately have been shifting lately to R.O.I. (as well they should): How to measure the R.O.I.of advertising, of PR, of Social Media, etc. And it’s about time too. Too bad it took an economic meltdown and the sudden evaporation of marketing budgets to finally put many of us on the spot, but I guess I’ll take that silver lining in whatever flavor happens to be available. At least now, those of us who liked to operate in a vacuum of responsibility are forced to give some thought to the value they bring to an organization (beyond bringing creative flair to sales brochures, catalogs and websites, that is), and this – my furry friends – is going to come in real handy come budget review time next quarter.
Make no mistake about this: Not being able to clearly understand, articulate and demonstrate your value to an organization is not a good way to establish tenure. If you can’t figure out your own value, your own impact in quantifiable ways, the powers that be sure won’t.
Okay, so as a warmup, ask yourselves if this lack of accountability might have something to do with marketing and advertising budgets always being the first to be slashed during a downturn.
Hmmmm. Coincidence? Koinkidink? (Um, no.)
All right. Now that you’ve revved up the old brain cells a bit, let’s go with the really relevant question for today: Given this lack of value (perceived) by the powers that be (Sr. management), how exactly do you intend to EVER sell them on the value of new strategies or technologies? In other words, how do you – Mr. or Mrs. “I have no idea how to measure my own R.O.I. – intend to sell “social media” or “WOMM” or “online reputation management” or PR 3.0 to an already jaded and skeptical team of managers?
Chew on that for a few minutes, and then read this little plateful of truth:
Most business leaders simply have no faith in Marketing. They don’t see it as an effective business function, they see it as an expense rather than an investment, and more often than not, marketing takes on the form of a formulaic, uninspired afterthought that barely ever ventures beyond the stale world of “marketing deliverables” like brochures, websites, mailers, press releases and print ads. Worse yet, these deliverables are often utterly ineffective in both design and purpose, adding insult to injury in the world of pragmatic, no-nonsense business execs. This is not good, and it needs to start changing immediately.
Write that down by hand, and
pin
it
to
your
wall.
Some wise words from a very smart man who says very smart things:
Okay… If you haven’t tuned out by now, welcome to the real meat of this post. You’ve done well to come this far. What comes next should be pretty helpful in helping you craft your department, agency or firm’s survival in the next year or so (and beyond). Read closely:
A few months ago, JP Voilleque over at Marketing 2.0 wrote about the generational roadblocks standing in the way of new and smart marketing being adopted by traditional or conservative companies. Here’s what JP has to say:
I have a special place in my heart for resistance to change. It is endearing, like sepia-tone photos of families in Wild West garb. But when it comes to grappling with network externalities, it loses that cuteness and becomes a real impediment to rapid adoption of effective messaging. The people who are ordering the message don’t think it “belongs” in the Web 2.0 universe except in very narrowly sliced, buzzword-laden places that are no less guaranteed to provide a return than the entire space.
[…]
We’re talking for the most part about first wave baby boomers, but in some cases we’re discussing some “silent generation” folks. So depending on circumstances, these are people who are focused on toeing the line, “team play” as art form, and (for the most part) a hierarchical model of career development, decision making, and information processes. The 1984 Apple ad was aimed at/authored by the second wave of the baby boom, the ones that came of age during the sixties, and aggressively anti-hierarchy (though no less hard-working). The roadblock is the first wave. Worse, it’s a committee of them.
Okay… Now that you have read that, let us come back to my original points and questions to you in this post:
Facing the truth is tough. That’s why humans invented repetition:
Fact: These guys don’t believe in the value of marketing because no one has ever shown them that it indeed has any value. Too many hacks in this business are content to charge exorbitant fees for deliverables without actually ever working towards actual business and brand-building objectives. (And I won’t even touch the topic of the growing number of internal marketing departments whose staff can’t come up with a single original idea, much less write half a page of decent copy.) Many small marketing and PR firms have thus become little more than job shops where a) the talent and the creative have – over time – slipped to the bottom of the commodity ladder, and b) have completely eliminated the strategic in favor of the tactical (if you can even call it that). This may be a great way to keep paying the bills, but it is no way to inject the true value of marketing into a company that needs it. Enough firms and practitioners do this, and the entire profession soon becomes plagued with low rent hacks selling “marketing” to business folks too busy running their businesses to know any better. This is how the marketing field spent the last three decades losing all credibility and value, bringing us to where we are today: A business world in which the first thing that gets cut during tough economic times is Marketing. Bravo.
Incidentally, the one line-item in a business’ budget that should actually increase during difficult economic times is marketing. Why? Because the best time to reach out to your customers and possibly gain market share is precisely when your competitors are retreating. We’re upside-down in this scenario because for the last thirty years, hacks have been dragging this discipline down into the commodity gutter. Enough is enough. We need to get back to business now. And I mean right now, starting with the very same first wave boomers who currently have absolutely zero faith in the discipline.
To these folks, marketing is at best fluff. Pretty fluff, sometimes, but fluff nonetheless. And expensive fluff at that. They reluctantly sign off on brochures, flyers, websites, catalogs and the occasional press release (the latter usually aimed at investors and stakeholders rather than their customers) because they feel that they have to. It’s just a cost of doing business. *sigh* Aside from this expensive exercise in seemingly worthless self promotion (a concept they aren’t particularly comfortable with anyway), marketing seems to be an expense rather than a worthwhile investment. This is the biggest fundamental problem faced by marketing departments and firms today.
Another way to look at it is this: There seems to be little to no measurable ROI from most marketing campaigns or activities.
Why is Marketing turning into the red-headed stepchild of the business world?
Chances are that if you are dealing with a CEO who has little faith in marketing, it is because no one has ever shown them the link that exists between real marketing (which reaches far deeper than just messaging), and something as simple as F.R.Y. measurements (Frequency, Yield and Reach), for starters. Forget brand valuation for the first couple of quarters. Don’t even bring it up. Just show them how great marketing can increase their sales through an increase in interactions between their company and its customers, a positive change in the average order size, and/or an increase in net new customers. This is something they understand. This is something that puts food on the table, therefore it is tangible. This is how marketing stops being fluff and starts being valuable. This is how cost becomes benefit. This is how risky expense becomes worthwhile investment.
In order to enable this transition, we need to connect the dots by demonstrating clearly and objectively that marketing drives business growth in a measurable, quantifiable way. Not only that, but your efforts have to show that the return outweighs the investment. Not through bullshit metrics but through measurables that actually show up on the P&L.
You aren’t going to turn the older boomers to pay any attention to quests and archetypes (unless they happen to work at Nike or Jaguar or Starbucks), but you can take these concepts and turn them into what they understand: ROI. Simple Business 101. Common sense cost-benefit data. Period.
Does this put marketing practitioners on the spot? You bet. And it’s about time too.
How do we begin to fix it? Well, for starters, by rebooting what Marketing’s purpose actually is:
The shift that needs to occur is simply this: Marketing practitioners need to a) stop behaving like commodities salesmen, and b) (to borrow a phrase from the presidential campaign trail) stop slapping lipstick on a pig.
Our job is not to sell deliverables like websites, catalogs, print ads and clever copy (and especially not the mediocre kind). Our job is to help folks who already spend over 80% of their time running the day to day operations of their business connect that business with the outside world in an effective and extraordinary way.
More to the point, our job is to help drive sales, create net new customers, and increase the number of positive interactions between the companies we serve and their growing customer base.
Our job is to help delight customers so that they will become a) repeat customers and b) brand ambassadors. Our job is to bring context to products, services and companies’ identities in specific cultural subsets.
Our job is to bring companies and “markets” together, which is really to say companies and people.
Summed up, our job is to develop all of the strategies and tactics that help companies find their audience, facilitate the first handshake, and develop lasting, delightful, fiercely loyal relationships with as many great people as possible.
Our job is to do this in a remarkable, memorable, delightful way. Our job, if anything, is to inspire our clients and the people they serve to engage in a relationship which benefits both parties equally, and somehow improves their collective condition in the process. Our job is nothing short of ensuring that the marriage between between them is a great and lasting one.
This is not the sort of thing you entrust to just anyone. Yet too many companies do just that – most of the time because they may not be aware that they have other, better options.
I say enough. Seriously. Enough with uninspired, ineffective mediocrity. Enough with chop-shop marketing. Enough with nonexistent (upside-down) R.O.I. Enough with the slimy marketing snake oil bullshit.
Enough.
Not until that first wave of boomer execs start to see that Marketing is as vital to their growth and as worthwhile an investment as an acquisition or product innovation will they be able to connect the dots between marketing activity and simple, bottom-line, black-on-white R.O.I. (Which will be the topic of an upcoming post.)
It’s time to start cleaning up our industry once and for all, one company at a time. If that’s what it takes, then so be it.
I hope you’ll join me in this quest, assuming you aren’t fighting the good fight already. If so, reach out to me so we can start helping each other better.
Have a great Tuesday, everyone. 😉
image by Chris Wray-McCann
Brand Building and Online Marketing Blog 
Ok this I like. Because I know more than my clients, I’m the expert. Because I know less than I should, I’m the problem. I excel at the creative strategies bit, the out there thinking bit and the convincing salesmen bit. I don’t understand enough about the rigorous analytics bit or the proof of results stuff or the linking work to measurable outcomes bit.
My business calls itself a design and marketing agency. I know all (some) about marketing theory and principles and sales promotion and DM and frequency and reach (less about the yield) and media planning and brand positioning and lots of other bits that give my clients a warm and fuzzy glow concerning my ability to fix things for them. Too much of it is hastily assembled and poorly delivered.
How can I fix me?
Shock and awe, baby! Great post. I think sound, thoughtful marketing is indeed as important-even an aspect of- a culture of innovation. That’s, bottom line what is needed, a culture of innovation that actually sees a lack of ROI and does something about it. Here’s where I would plug a recent post on innovation and design if I were that kind of person 😀
Thanks for always inspiring, Olivier.
I’m not a marketer. I did spend five years inside Microsoft, working as a Content Manager with the US Marketing team.
I’d break the function I saw there into two broad segments:
Stuff Customers Really Wanted (very small subset)
For example — a very popular X-Box game. In that case, the function of marketing was mostly to let potential customers know it was coming, tell them a little about what was in it, and make sure they knew how to order it.
Stuff Customers Didn’t Really Want (very large subset)
For example — Windows Small Business Server. A product that most businesses didn’t understand, didn’t want, and really weren’t interested in. Marketing — in the case of this product — was mostly focused on trying to come up with ways of convincing people they had a problem that this product could solve.
Unfortunately, 95% of products in the world fall into the second category. You don’t really need a new car, or a leather BlackBerry cozy, or ermine socks.
And in business, it’s become old hat to describe the measurement of success as “Return On Investment”. My favorite example (as a guy who creates training courses) is the one-hour training course in how to answer the phone that cost $100.
Immediately after taking the course, our receptionist answered the phone and booked a $1 million dollar order — providing a 10,000% ROI! Order some more of those training courses, Bubba!
The biggest benefit of good marketing (keeping your name in front of potential customers) is pretty much impossible to measure. But IBM, and Coke, and Apple seem to be willing to spend billions doing just that.
In the Social Marketing world, you do that by providing great content to your customers — information about solving their problems, fixing their pain, providing new ideas on how to make their lives better. But trying to map that to a specific sale works no better than crediting your receptionist for the million dollar sale.
“Make no mistake about this: Not being able to clearly understand, articulate and demonstrate your value to an organization is not a good way to establish tenure.”
If we had all adhered to this model…we’d all be a lot better off (regardless of field). I share your disdain for the snake oil as well…can’t we just embrace solid proposals, good ideas and interesting approaches for what they are?
Completely agree that we have to fix the ROI issue, but I think there’s also a concurrent problem in the marketing world that needs a solution – the people problem. Having served in both the agency world and on the client side for the past 14 years, I’ve gathered a few observations.
Agencies use their “big guns” (director/VP/C-level) to win a client’s marketing business. Then they hand the execution over to the youngest, cheapest, most inexperienced labor they can find. Management says, “Here’s your client, here’s your job, good luck with that.” The poor soul then enters a vicious cycle: flurry of ineffective (yes, tactical) activity, lots of billings, unmet expectations, client dissatisfaction, the infamous come-to-Jesus meeting, finger pointing, burnout, TURNOVER – then start again with a new victim (or, after a few revolutions of this cycle, the client just hires a new agency).
On the client side, technical experts are asked to handle – or at the very least give input into – the marketing efforts. They don’t know how to start the conversation with their customers or potential customers, focusing instead how to “present” the product’s features they spent a decade developing. This becomes the core of their creative direction to the agency; along with “make the logo bigger.” Nothing works — they blame the agency and move on.
No wonder we’re stuck in the quicksand.
You are right on in saying that companies/agencies alike need to see marketing as a discipline that requires investment, but I’m not sure which comes first: investing in the approach to measuring/justifying, or investing in the people/infrastructure who have the training and ability to lead in this approach. I sense your frustration with the way things are, and I agree it’s frustrating, but it’s also exciting to see the great potential of what today’s marketing (2.0, 3.0 — whatever it takes) can bring to the table.
I’ve dealt with a number of top-level marketing execs who have used the intangible ‘marketing veil’ you’ve described as a primary means of preserving their comfy positions. Sad, but true. You see, as long as there are no measurable results to report, there’s no quantifiable failure to own up to. And trust me – if anyone were actually measuring their effectiveness, they’d be fired immediately.
It’s incredibly frustrating to watch companies spin within this infinite loop of intentional ignorance.
Wow. As usual, the comments waaaaay outclass the post. You guys are brilliant. Thanks for adding so much to the conversation. 🙂
Olivier – you’ve stolen my thunder! I’ve written similar (although not nearly as totally thought out as this one) posts since last year. It truly is a tragedy that we are now paying more attention to ROI as a result of the downturn. It’s impossible to say with any certainty whether or not your budget could’ve been saved if you would’ve had an ROI mindset before, but I think there is at least a decent chance that much of it could’ve been saved.
Chuck, assuming that you were able to demonstrate the value of your marketing activities, yep. If not… well, the risk is that the budget may not have gotten cut, but some people might have been shown the door.
It is a lot easier for folks to point to marketing as the culprit (it’s an imprecise science – more art than science, even, hard to gauge direct impact, etc.) than admit that they might just suck at their job. 😀
Blaming marketing for being ineffective is like blaming a Ferrari for smashing into a wall during a race when clearly the problem was with the driver in the first place.
Let’s rescue the discipline and its image, and help the folks who have no business “driving” help more productive careers better suited to their skills.
Tate, you invest in people. That’s really key.
Unfortunately, many companies either invest in “asses in seats” (does this guy have five years of experience as a graphic designer? Is he willing to work 60 hour weeks for $30K? Cool. Hired.) or they invest in pedigrees (This guy has worked with Microsoft, Disney, BMW, Nabisco, Nestle and NBC? Hired!!!).
Unfortunately, neither mean jack squat on their own. Pedigrees are completely irrelevant. I have worked with brilliant (and I mean BRILLIANT) people who had never worked with major B2C brands and had very little experience. These folks could absolutely have turned around GM long before the fit hit the shan.
Likewise, I have suffered – no, endured – working with people with impressive resumes (folks who had held upper level strategic positions with huge companies) who basically didn’t do anything. And didn’t know how to do anything. Except talk about their resumes.
The two questions that matter: What did you actually accomplish while you were VP of whatever at Disney, HBO, Nike and DELL, and what do you intend to do for us here, now?
(There’s also the “will this person fit into our culture… or help change our culture for the better?” question, but that’s a whole other discussion.)
For agencies, the situation is even more precarious: There is a cultural divide between agency folks and clients. They simply don’t speak the same language, have the same objective, or see the worl in the same way… which is why AEs and ADs cannot be pure agency folks. At some point in their careers, they MUST have had management experience on the client side. If that person doesn’t have this key element on their resume, they are very unlikely to ever create the type of relationship that will benefit either the agency or the client for any decent amount of time. This is a major problem. (Ask any company on the client side, and they will agree, by the way.)
Boo-yeah master chief.
Tim, I’ll get back to your question in a little bit. I have to run out for a while. I’ll be back, though. I promise.
“Enough” indeed. It’s about time marketing and brand people take back the profession and show why it’s of value to business (and upstairs).
Olivier, here’s what I loved about your (awesome as usual) post:
“hacks have been dragging this discipline down into the commodity gutter”
Amen to that. It isn’t about the tactic or how cheap you can get a brochure. Focusing on the “connection to the outside world,” to customers (and I would also say employees) is vital. It’s why so many companies have failed or are trying to dig out of really large holes with very small (sand toy) shovels.
“measurables that actually show up on the P&L”
You hit it on the nail. Difficultly is that many in the agency world don’t understand numbers, budgets, let alone a P&L. How can agencies serve clients if their account team doesn’t have a grasp on the inner-workings of business and creatives don’t understand client needs (versus simply cool creative).
“cultural divide between agency-folk and clients”
Yes. Yes. Yes. But the problem goes beyond simply hiring great people who have some relevant business experience. It gets to education. University programs that are well known for advertising or communications focus on all the right things to enter the profession EXCEPT basic business. I think those in communications, advertising programs should be required to take business courses so they understand the basics. Why is it that ad programs don’t teach the agency business? Students may be able to write a brief (I stress may) but they can’t understand how to estimate a project or talk with a client about budgets. Granted many firms (mine included) like to train account people but it sure would make things a heck of a lot easier (and better for clients) if there was some basic knowledge to build upon.
Thanks for the thought provoking and discussion inducing post.
Olivier this is an awesome post. If we had it all figured out I’d leave this “sales” world, write the book, and go on tour! I can preface this by saying my sphere of influence is that of print advertising and not all facets of marketing/PR etc… I’ve been on all three sides of this conundrum sourcing, using, and now supplying. Being new to the area I’m trying to work with people on their printed collateral that now have the smallest budgets they’ve ever seen. It’s taken our business as printers from consultative and value-add to the cheapest supplier. Anyone can do it right. There are a lot of things that can go wrong when you jump around from cheap to cheaper to cheapest similar to Tate’s observation of Agency Big Guns and Turnover. You can lose a lot of knowledge by jumping around if you had the right fit in the first place…I digress though.
On the marketing side I talk a lot about PURL’s and cross media campaigns. I just can’t figure out why they haven’t caught on for high value customers. It seems like a simple concept. Each step of the way you learn a little bit about the customer and if they’re truly engaged with your product. The message can be adjusted based on feedback or response rates since it is all POD or viral through email, print, and personalized web pages. And studies show that deeply personalized touches have a response rate upwards of 7%, where just a name has a 2% average return. So that’s what the experts say.
These numbers don’t make a lick of difference to those who aren’t aware of their response rates. Let alone conversion rates. Other then the additional cost of cleaning up the database and some programming I’m not sure what the adoption hold up is. Do you guys have any suggestions on why PURL’s and Cross-media or multi-touch media campaigns haven’t caught on in the marketing/advertising industry? What are we printers doing wrong when trying to communicate these ideas to clients?
Giddy up, Jerry Maguire! Well done. I’m about ready to jump in a car and drive down to SC just to buy you a beer or coffee (or hell, dinner).
IMHO, the money line here is Summed up, our job is to develop all of the strategies and tactics that help companies find their audience, facilitate the first handshake, and develop lasting, delightful, fiercely loyal relationships with as many great people as possible.
But, it’s also so solid. I love your take on F.R.Y. and, in fact, quoted you in my recent whitepaper. It’s a great model and one I believe in, but I’ve not yet mastered the part on getting the actual data, but that doesn’t mean I’m not driving towards it!
Way to rock it! Proud member of the Brand Builder Tribe here.
Come on down, man. I’m thirsty! 😀
Be careful not to fall into the trap that assumes all clients are idiots and only a select few ‘get it’ – it’s just not true. Granted there isn’t enough rigour and too much reliance on pseudo-scientific metrics that are usually heavily weighted in favour of the campaign.
But there are a lot of clever people doing a lot of clever things out there. Instead of self-congratulatory hand-wringing (“why can’t everyone be as clever as me?”), it would be much more positive to invest time and energy in defining a new breed of metric – one that enabled clients to cut through the BS and recognise true bottom line boosting performance. While everyone trademarks their own unique bespoke analytics, we are no better than the phone companies that for years sought to confuse customers by developing ever more complicated pricing tariffs with only one aim – to prevent their customers from making a fair comparison between competing telcos.
To me, it comes down to one thing:
Are you a vendor, or are you a partner?
If you position yourself as a vendor, you are competing on price, turnaround time, etc.
If you are a partner, your clients involve you in making strategic plans, and then rely on you to execute them.
Is one position right and one wrong? While I often get mad when I’m undercut by a “vendor,” I don’t think it is wrong that a prospect chose the vendor over me as a partner. Perhaps that’s all they needed at the time. And if the “vendor” is able to make a profit and put food on their table, I don’t blame them either.
Our job is to be selective and qualify our clients. We can’t work with everyone, we can’t fix everyone’s problems. That’s ok. We just have to work harder to find the people we can work with.
There is much “food for thought” on here…
Speaking of R.O.I. I cannot wrap my head around why everyone and their mother has suddenly decided that they are the expert on social media. How many more seminars, blog posts, tweets must we listen to?
I have three words for you posers: Snake. Oil. Salesmen.
Walking into an ad agency from my former company (a huge corporation) and seeing how my boss handles an email is 10 degrees backward than the way I would have handled it. Every day I seem to learn something new.
Tactical pieces without strategy, sorry to say but we have all been guilty on this note. You have your ideas, the client has theirs, and you just “give up” in a sense because you don’t want to lose time, money, resources, etc… so you end up giving them what they want – crap.
Agreed that this whole industry needs a kick in the pants; I don’t know if good ideas are shot down regularly, but it seems that agencies and clients are playing it safe when it comes to launching campaigns. Sign of the times? Perhaps. Maybe another thing is happening – Saturation. The Internet is now saturated with marketers and wannabes. Firms, and marketing execs alike are all using the social media thing for exposure… but who is listening on the other end?
Oh my gosh, marketers – what a mess on the Web we are making!! Years of useless advertising, blogging, twittering… flushed down and buried beneath layers and layers on the Internet.
One thing I’ve learned: Effective marketing involves strategy and messaging – be selective about your medium.