RETURN ON MARKETING INVESTMENTA Lenati Point of ViewJennifer Winter, Managing PartnerMartin Mehalchin, Prinicipalmmehalchin@lenati.com

1

Elevating Marketing Using An ROI Mindset

The Marketing Executive’s Dilemma

Marketing organizations can/should take on many responsibilities for the organization

–Product Marketing, Customer Research, Customer Segmentation, Go To Market Strategy, Customer Experience Programs – Pre/Post Sales, Brand, PR, Integrated Marketing/Demand Generation

Marketing channels continue to increase (search, 3rd party websites, affiliate marketing, social networking, influencer networks, viral/citizenship marketing) requiring investment trade-offs.

Marketing continues to become more dependent on data and technology to achieve results requiring left and right brained talent

Average tenure for CMOs at the top 100 branded

companies is just 22.9 months

CMO Tenure – Slowing Down the Revolving Door (Spencer Stuart)

Complexity & Sophistication Growth

Barriers to Optimizing Marketing’s Value/Promise

• Access to evolving, specialized marketing capabilities and skills

• Proliferation of strategic objectives and marketing activities

• Visibility and accountability for outcomes versus credit for “looking good”

• Inconsistent connections between marketing and sales

• Lack of common or shared goals

• Sales not connected to campaign rollout/training efforts

LEADINGStrategy,

Structure, Process

LAGGINGData &

Infrastructure

• Lack of systemic, reliable information to make data driven decisions around optimizing marketing investment

• Typically limited ability to demonstrate the causal relationship between the impact of marketing and the achievement of overall business outcomes

Pathway to Tapping Marketing’s Potential - Step 1

Strategic Value & Intent1

• Create a marketing strategy roadmap• Prioritize strategic objectives and phase implementation over time• Define and charter focus areas with success criteria• Identify needed improvements to infrastructure and capabilities

Deliver The

Base Promise

Scale Our Offer

In Our Chosen Market-space to “Be THE One”

Expand our Share

of Mind to new Verticals and or

horizontals

Presence

And Trust For Existing Customers

Time

Imp

ac

t

Representative Strategic Themes

Pathway to Tapping Marketing’s Potential - Step 2

Customer Centric Marketing2

AwarenessConsideration /

InterestEvaluation Purchase

Acquire/ Implement

Use AdvocatePerceptual Journey of

the Customer

Unaware of Capabilities

Need to Understand

Value

Want to investigate

Ready to buyObtain Solution and Implement

Use and Maintain

Want to share / engage

• Understand how customers buy, and their decision stages

• Align programs and campaigns to decision points and deliver via customer-preferred channels

Marketing Conversion Sales Conversion Post Sale Experience

Pathway to Tapping Marketing’s Potential - Step 3

Operational Measurement & Alignment3

Operational Measurement & Alignment

• Measurement & clear accountability for marketing outcomes• Productivity Measures – Are we delivering outcomes we

committed to? • Efficiency Measures – Are we good stewards of allocated

company resources?• Effectiveness Measures – Are the results achieving what we

intended?

• Marketing operations cadence• Monthly operations reviews• Marketing dashboards• Monthly contribution and funnel analysis• Quarterly Business Reviews (QBR’s)• Annual strategy review and evolution

Marketing Measurement Using ScorecardsThe typical CMO—according to our research—is able to neither measure nor systematically communicate on the fundamental business processes in the marketing function and their results. This can set the stage for a CMO's failure.CMO Council Report – Define & Align the CMO

ROI is a MindsetScorecard Objectives

ROI is not a financial calculation. It is a

measurement mindset that requires you to

continually ask the following questions:

Objectives: What am I trying to achieve?

Audiences: Who am I trying to impact?

Metrics: How will I define success?

Resources: What will I need to invest?

Results: How well did I do?

Learning: How can I do better next time?

Clarify and define the role and value of marketing

Enable a learning organization that makes decisions on facts supplemented with experiential intuition rather than lots of intuition punctuated by a few facts;

Creates a culture of performance and success and provides a tool to communicate why/how marketing matters to the business

Elevate marketing accountability to earn the trust and confidence of the CEO, the CFO, and others throughout the company.

Category Spend Analysis – A 1st Step Toward ROI-driven Marketing

Structured Analysis Approach

Evaluate Spend/Cost Driver Categories

•“Should we be spending on this at all?”

•“Are we ignoring good opportunities?”

•Category examples: online, traditional media, trade shows

Evaluate Share of Spend

•“Are we spending the right amounts?”

•“Should we allocate more to `X’ and less to `Y’?”

Evaluate Within Category

•“Are we maximizing the opportunity?”

•“Is marketing connected to sales? Are we generating leads?”

•“Can we approach this category differently?”

Return on Marketing Investment (ROMI) – Category Spend Analysis Framework

Availability of Data Will Drive Precision of Analysis

• Quantitative Sources– CRM data

– Survey data

– Benchmarking data

• Qualitative Sources– Staff interviews (chiefly inside & outside sales)

– Channel interviews (dealers, distributors, sales agents etc.)

– End customer interviews

If mostly qualitative input is available, then implement change as a series of measurable test and learn exercises

Process Based Analysis – Trade Show Example

Trade show

# of leads

Act

ivit

yM

etri

c

Inside Sales

% of leads resulting in

appts.

Outside Sales

Resulting closed sales (# & $

value)

Forward Analysis

Reverse Analysis

Sample set of closed

sales

Trace the history of the sale

Where were the marketing touch points?

Which touch points influenced the purchase decision?

Did the decision maker attend a trade show?

Identify initial point of contact

Was it a trade show?

About Lenati

OUR BUSINESSLenati is a services firm that designs, implements and optimizes marketing, sales and services experiences for companies who want to build stronger customer connection. We believe product innovation and pricing are no longer sufficient to drive competitive advantage –today it depends on a company’s ability to deliver a compelling experience across the entire customer lifecycle. We have the solutions and the team to get you there.

OUR PEOPLE

As part of our drive to be a services industry leader in helping organizations maximize their market performance, we have assembled a small, high powered group of professionals and strategic partnerships that help us deliver innovative solutions that can help your organization make an immediate impact in the marketplace.

OUR SOLUTIONSWe have five core service lines that we use to deliver stronger customer connection for our clients:• Go to Market Strategy• Market Assessment and Product Planning• Marketing Program Design & Optimization• Sales and Channel Program Design & Optimization• Relationship Management and Influencer Program

Design & Optimization

Company Overview

Solutions

Lenati offers a complete set of solutions to help your sales and marketing efforts to drive customer connection and satisfaction and increase revenue

Persona Development

Pricing Strategy

MarketAssessment

Go to MarketStrategy

Marketing Strategy & Programs

Sales & ChannelStrategy

Service & Support Programs

Marketing & Sales Optimization

Pricing Strategy

Business Plan Development

Market Assessment

& Sizing

Competitive Assessment

GTM Plan

Customer Segmentation

Campaign Strategy

Customer Loyalty & Retention

Community & Influencer Programs

Relationship Marketing Programs

Product Roadmap

Development

Channel Strategy & Execution

Partner Strategy &

Management

Tele/Online Sales

Strategy

Lead GenStrategy & Execution

Sales & Marketing Analytics

Sales & Marketing Alignment

Support Strategy &

Org. Design

Cross-Sell Strategy & Programs

Acct Mgmt.Program Design

Sales & Service

Alignment

Satisfaction Programs

Sales & Marketing Processes

Marketing Spend

ROI

Comp & Quota

Strategy

Customer Experience

STRATEGIZE MONETIZE OPTIMIZE