I apologize to everyone.  It’s been a good three weeks since my last post.  With school starting back up again, the work associated with school means that everything else becomes a secondary priority.  Nonetheless, I find myself having a break in my studies, and thus, I look to continue my dialogue with everyone.  While school is indeed important, I think it is also vital to stay connected in the online marketing world as much as possible.  And while blogging might be a small way to stay connected, we all have to start somewhere.

Since I mentioned that school started back up again, I thought my audience would find it interesting to know which classes I am taking this module.  (MBA schools run in modules, not semesters.  One module is one-half of a semester.)  I currently have four classes, which include Venture Capital and Investment Banking, Financial Econometrics, Global Marketing Management, and Research Methods in Marketing.  Financial Econometrics is by far my hardest class.  I’m supposed to learn about single and multivariate linear regression models and how they can be used to explain certain phenomena in business.  What I’m actually learning is that my calculus is very, very rusty.  Global Marketing Management is probably the class I enjoy the most.  The professor is engaging and the concepts we learn are thought-provoking.  Probably the biggest lesson I’ve learned so far in that class is that when it comes to marketing on a global scale, there is no tried and true method that works in a ubiquitous manner.  In Research Methods, I’m learning various…well…research methods.  Such methods to date include decision tree, logit, and concept testing.  Not entirely exciting, but extremely helpful.  In my VC class, we analyze term sheets, equity sharing, investment opportunities, and small business valuations.  It’s actually quite an exciting class, and I really enjoy it.

Anyway, I’ll do my best to continue my once-a-week blogs.  In the meantime, my financial econometrics textbook is calling my name. 
 

My CMO, Lisa Arthur, has asked me to read a series of articles written by Dr. John A. Quelch, a professor at Harvard’s business school.  His words are quite enlightening and I encourage everyone to peruse through some of his works.  In one of his articles, “Bringing Customers into the Boardroom,” he demonstrates the revolution that marketing is experiencing.

Quelch argues that for the majority of companies, the marketing strategies and activities are not in line with the corporate strategy.  He continues to argue that boardrooms and CEOs are more concerned with “governance and financial purity…mergers and acquisitions, executive incentive packages, and succession planning” than they are about meeting the customers’ needs.  As a result of the misalignment, three main consequences occur which all result in the destruction of shareholder value.  First, marketing departments are not held financially responsible for their actions.  Second, brand equity is no longer a concern of the boardrooms.  Third, companies have failed to keep pace with the recent, rapid change in the fundamental nature of marketing.

Quelch’s solution to the conundrum is to create a dashboard with various metrics that marketing can present to the board.  I believe it is a call for all marketers to begin proving their worth.  Or, as High School musical says, “Get Your Head in the Game!”  (I know that song because I have a 14 year-old sister.  Not because I enjoy the show.)  So, this is a call to all CMOs, Marketing Managers, Marketers, and Neophytes the world around, please, please, please for the love of ROI, “Get Your Head in the Game!”  Prove to the world that you can play with the big boys. 
 

Like many other terms, Marketing Optimization (MO) can hold different meanings for different marketers.  For online marketers, it means developing marketing campaigns that do A/B testing on emails and microsite pages to see which one’s generate the most opens, click-thrus, conversions, etc.  Those emails and web pages that underperform are eliminated in favor of the best performers.  For other marketers, MO means optimizing your communication strategy across campaigns and marketing channels to improve response, customer loyalty and profit.  It is the later meaning that this article will focus on.

Initially, optimization was used as a way to mathematically determine the optimal allocation of scarce resources. The concept has been borrowed by business analysts to aid decision-making.  Optimization has been used in the areas of the manufacturing supply chain, airline revenue yields, and financial investment risk assessment. More recently, the concept is being adopted by marketing.

Every day, marketers face realities like competing business goals, campaigns, channels, budget constraints, and product managers with myopic views, to name a few.   Large companies are often faced with campaign calendars that may not represent an ideal communication plan with its customers.  The below diagram illustrates this phenomenon for an electronics retailer.



As you can see, campaigns and customers associated with these campaigns can easily overlap.  If you are a prospect in each of these campaigns, will you feel overwhelmed by the number of contacts?  If you are a marketer with limited budget, how should your prioritize your spend across campaigns to generate desired response rates or ROI?  With multi-LOB companies with many products and services, it makes great sense to employ some degree of intelligence into the marketing equation to ensure a win-win outcome for companies, LOB’s, and last of all but not least, customers.

MO across campaigns and channels typically relies on the development of business rules, the utilization of sophisticated mathematical algorithms, or both.  Most software applications that use mathematical algorithms typically use linear or non-linear algorithms that attempt to maximize an objective function (e.g., response rates, profit), while imposing constraints.  Constraints may include: budgets, minimum/maximum number of offers per customer and/or campaign, channel capacities, etc.  While very powerful, optimization algorithms are problematic to use.  They require statisticians that build customer response and valuation models, as well as profitability models.  This takes time and money.  Then there is the issue of ensuring the algorithms actually find the global minimum (cost) or maximum (response rate) as desired.  The image below helps to visualize this issue.



It’s possible for algorithms to find “local” minimum/maximums that lead to sub-optimal marketing outcomes.  That being said, in the hands of the right practitioners, mathematical optimization can create significant marketing ROI.  So, short of the required expertise and/or budget, what are marketers to do?

More recently, software vendors have tackled this issue via the development of business rules that marketers can build.  Business rules can work within and across campaigns to optimize your communication plan.  Examples of business rules include:

• No more than 2 weekly communications via any channel to a customer, to minimize fatigue
   
• Make the best of multiple potential offers based on profit, revenue, or likelihood to purchase, as examples.
   
• If a customer may be touched by multiple campaigns in the next month, only communicate with them about the two campaigns with the highest priority.

These types of rules can easily be developed using a point-and-click interface like that found in Aprimo’s Contact Optimization module. 

So, business rules are easy to create and use -- there must be a downside, right?  Yes, there are tradeoffs associated with simplicity and ease-of-use.  Some of those include:

• We are really not optimizing an outcome from a mathematical point of view.
   
• Business rules support “subtraction”, i.e., supporting the imposition of a maximum number of touches, offers, etc.  Linear and non-linear algorithms can do that, but they can also impose minimums like, the number of offers or contacts per campaign.

Keep a look out for my next article that will continue this discussion and provide some real-life case studies.

 

I’m sitting on a plane somewhere over the Atlantic working feverishly to close Q4 business while working on marketing strategy and its complementary partners of marketing plans, budgets and financial management, and spend plans. I know I’m not alone in my focus or quarterly sprint. I had the opportunity to meet with several of our customers in London at our EMEA Customer Conference and I know they shared with me that they are doing the exact same thing right now.

What did I do before Aprimo and the “Single Source of Truth”  marketing software that enables us to inspect and analyze what this year’s spend was and how it performed to drive our business?  I remember all too well what I did. I muddled through 36 versions of PowerPoint decks,  flipped and paged through volumes of Excel Spreadsheets that in the end – probably brought down at least two trees. Sigh.

 
I know I’m not alone. Just this past couple days I listened to other marketers representing the largest companies on the planet talk about how they use our marketing software to truly do more with less. It, coupled with the continued optimism that 2010 will bring us better business climate, makes up the juggling act of annual planning against quarterly results.

 
So guess what? In the end – that means I have time on the plane to write this short blog and contribute to our 2009 social media strategy that I’ll then load into our digital applications that help us manage and monetize blogging. 

Are you alone with your spreadsheets or your blogs? Which ones will drive more interest in your products or services? Let us know if you want to join the marketing innovation going on at Aprimo.

• The top three tips for marketing process management to drive revenue through enhanced customer communication.
• The top three tips for marketing process management to improve operational efficiency, reduce costs, and eliminate waste.
• How can companies assess technologies and derive value from marketing process management?

September 30. Month end and quarter end. How is 2009 already 75% behind us? A second ago I was ringing in the new year on the ski slopes. Summer is officially over, too. Soon it will be dark when I wake up and dark when I get home. Minimal sunlight, as if I need another reason to be depressed while I endure a cold midwest winter.

Today, finance and marketing finance professionals everywhere will be busier than busy. It's time to close the books. How much did we spend this month? How much did we make? Are you sure? What about the quarter as a whole? And don't think tomorrow they'll wake up to a stress-free day. It's not all wrapped up by the time the clock strikes October.

Hopefully, marketing finance operations are a piece of cake for those marketing finance folks because they are using a marketing financial management software like Aprimo's to manage their budgets all month long. When forecasts are laid out, commitments entered and invoices approved against those commitments, you know exactly where your dinero went, when and why. Done and done.

Personally, there's nothing hitting me over the head when another month or quarter comes to an end. Most of the time, I don't even think about it, unless a sales manager is explaining that they didn't call me back right away because contracts this and signatures that. It doesn't bother me that Q3 is over. But summer... I'll be pouting about that until Easter.
 

One of the roles of marketing operations (IMHO), is managing processes.  One of the more obvious areas that needs process is review and approval.  This aspect of Marketing Process Management can really pay dividends.  The first big value comes when you decide to define your review and approval processes in one place and in written form.  For heavy compliance-driven businesses (pharmaceuticals, financial services) this has probably already been done in some form.  For many others, this may be one of the first times you take the time to identify a process for reviews. 

There are many things to consider -

1. The obvious is the list of who has to review and approve a particular piece (this will almost always vary by the type and content of the piece).
2. Next you need to consider the sequence.  Who should review it first?  If you have a group reviewing something at some point, is it consensus (all have to approve) or majority (more than half must approve).
3. What do you do if a review is rejected (start again, run through same review after rework, etc.)
4. Do you want to run one clean review at the end to make sure everyone agrees with the interpretation of comments (I recommend this!)?

About two years ago, my wife and I entered another phase of life - empty nest.  Just to clarify, our second of two headed off to college and wasn't looking back.  Our first was entering his senior year with grad school in his sights.  So, we were staring a very quiet house in the face.  Now, I don't want to say that my wife and I were celebrating this event.  in fact, we really enjoy the company of our sons and were lamenting this loss. 

Fastforward two years....during the first year and part of the second year we ended up welcoming a friend into our household that was going through some tough personal problems (a divorce).  This was good for us and helped transition us to the actual quiet time.  During the first summer, our sons returned home and we added two cats to the mix. During the second year, we experienced a fair amount of the empty nest so our jobs consumed much of the empty space. Now we have gone through another summer and one son stayed at school and the other graduated from an intense one-year business degree focused on Financial Management.  Needless to say, the job market is decimated, so he is still with us and studying for actuarial exams. 

So, what's my point (you should be asking)?  Marketing is just like our life...hard to predict and full of unexpected surprises (some good and some not).  For this reason, you need to be constantly tracking your marketing finances from an overall perspective so you know what money is spent, what is promised and what is forecast.  How else can you know how to react to new opportunities (Social Media Marketing), new competitive moves (product launches), needs for the sales pipeline or economic changes?   It's hard to find automation
that will help you deal with life's unexpected changes, but marketing automation software can definitely help a marketing operation stay swift on its feet.

When I graduated from college and entered the business world four years ago, I would've readily admitted that I didn't know much at all about corporate America. There were things I knew I didn't know, like how people managed to work in the same job for years. My experience, to that point, included various jobs that each lasted between four and six months. But, for the most part, I didn't know what I didn't know.

I didn't know that there were thousands of unique job titles in marketing that I could explore with my marketing degree, and I didn't know what those job titles were or meant. Marketing Research. Marketing Communications. Media and Public Relations. Marketing Campaigns. Inside Sales. Graphics. Web Content Management. Product Marketing. Event Management. (I like the sound of that last one...)

I also didn't know there would be applications and programs and software that would help me accomplish and organize my day-to-day work life, let alone that one of those software programs would fall under the marketing operations software umbrella. I definitely didn't know that I'd be working for a company that develops an industry leading product under that umbrella.

At Aprimo, we drink our own champagne. We develop and sell marketing operations software, and our marketing department uses it. I was introduced to "ARC," our internal implementation of the software, Aprimo Resource Center, on my first day. In those days, using ARC, meant researching, verifying and updating customer and prospect data in our database. Today, it means a hundred different things. I can't manage the planning and logistics of an event without it! I mean, I could. But I'd rather not.

When we're evaluating a new event, we use the proposal process. When we've decided to host or sponsor an event, we track the financial forecast, what we've committed to spend and what we've actually spent. When we need to make sure that ten team members are working efficiently on different aspects of an event, we use a workflow that sends reminders, captures completed work and approvals, and dynamically adjusts if the timeline changes or a new step is inserted. This is not simply project management, people!

I wonder... where do you find yourself today? Maybe, you're like me four years ago and are still trying to figure out what marketing operations software is. (If that's the case, I wonder how you stumbled across my blog...) Maybe you do know what you don't know, you know you need to learn more and find a solution that best fits your organization, but haven't done anything about it yet. Or maybe you're a perfect specimen of a marketer, with effective marketing operations software in place, and we could all learn a thing or two from you. So where do you find yourself and what do you know?

I mentioned getting Marketing Finance Operations under control in my last post.  We operated as a typical marketing organization with distributed authority for approving expenses and no real good central mechanism to track expected expenses.  The complexity with managing marketing financial software is the various stages of marketing spending. 

First, there is a forecast for a program (e.g. an online marketing campaign)  that is planned in the future.  This "earmarks" money from the budget somewhere out in time.  Second, there is the point where you actually start to commit spending money for the online marketing campaign through a verbal or written contract (e.g. a PPC advertising campaign).  Finally, there is the actual invoice when cash flow is impacted. These all need to be managed on three dimensions - a budget, an activity and alignment with your General Ledger accounts.  Visibility to all these aspects allows me to react to budget increases (yes, it can happen), budget cuts (okay, this is more common) and the desire to change plans to react to market dynamics.  The association with the General Ledger provides an alignment point between Marketing Operations and the company accounting system.

In the past, we would get invoices that we didn't realize we had not yet paid and be forced to adjust our future spend when it was almost too late.  A good proportion of marketing spend is committed well in advance. When we had to adjust within a quarter, our options were limited on finding places to cut.  Also, without the visibility of what was committed and what wasn't, we didn't really know what activities carried a large amount of sunk cost.  The other side of the equation, measurement, is equally as important. Without knowing the cost of an activity (the Investment), it's pretty difficult to assess the Return on Investment or ROI in Marketing.  But, that's a topic for my next post.  Until then, may the marketing process be with you!

I can honestly say I had never even considered the term Marketing Operations prior to starting at Aprimo nearly four years ago. Now I’m not only entrenched in promoting this technology for marketing to help automate and manage marketing, I’m also knee-deep in managing Marketing Operations at Aprimo. I guess this is what I get for having a strong math and process background. It goes back to my days as financial manager for the Concert Committee and my fraternity in college. My engineering degree gave me a healthy appreciation for process. However, my creative side drove me into marketing so…well…here I am. 

I’m fortunate to play a role that feeds my creative side and my process/logical side. What I find interesting is how marketing operations seems to be the step child of marketing automation. I understand that the “execution” aspect of marketing is where the rubber meets the road and demand is created, however; I am amazed that marketers don’t fight the amount of detail and project management they have to deal with to get to the creative work. A good marketing operations application can simplify a lot of this. It takes some work, but the pay off can be great. From financial tracking, to managing creative workflow and our digital asset library, we’ve benefitted many times over. A couple of years ago, we became our own case study when we let our discipline relax and lost track of some big invoices. I got the assignment to get our financials back in control and put some process in place supported by our own product.   Now, I'm tracking ROI in marketing activities.

Stay tuned and I’ll give you some more details on working with marketing financial software. If you are having similar issues or are on your own marketing operations journey, I would love to hear from you.

Here we go - my first blog post.  I hope you enjoy reading my musings on marketing automation software.  And yes, I'm naturally a little nervous about freely sharing my thoughts and ideas, but hey, I'm excited to learn from your feedback and dialogue, so don't be shy.

For those who don't know me or my company, I co-founded Aprimo, Inc. with Rob McLaughlin in 1998.  Time flies when you're having fun!  Despite all the nay-sayers chirping "are you out of your mind -- marketing can't be automated, doesn't want to be automated ... marketing is an art, not a science ... don't waste my time," we followed our intuition and passion to build a company to fundamentally transform the way companies would manage marketing in the 21st century.  Looking back, our decision to start Aprimo has been an immensely exciting and fulfilling professional journey that I wouldn't trade for anything.   
 

Since this is the point of origin for my blog, it probably makes sense to start with sharing my vision for Aprimo.  Aprimo's vision is to provide innovative software solutions for companies to automate their marketing value chain; accelerating their marketing productivity and optimizing their marketing return on investment.  It's simple, yet comprehensive.  It's unique, yet relevant.  It's revolutionary, yet overdue.  It's bold, yet achievable.  Our vision and execution over the past decade has created many new categories of marketing automation software - such as Marketing Resource Management and Enterprise Marketing Management, and yet our vision remains an integrated super set of all these sub-categories.  We are still growing into our shoes.  Aprimo's mission is to build a world-class marketing software company whose products become the defacto-standard application platform used by every marketing professional to 'manage the business of marketing.'   
 

Fast forward to today.  Aprimo has hundreds of customers with over 100,000 marketing professionals using our applications in more than 40 countries world-wide.  Did someone say this type of solution was overdue?  We're having a blast teaming with our customers to solve some of their most pressing marketing challenges - encompassing interactive marketing, multi-channel campaign management, lead management, production workflow, marketing planning and financial management.  

I look forward to sharing these experiences with you in my future blogs.

It’s been just a little more than three months since I decided to shut down my marketing services company, jump back into my pumps and back into the proverbial hot seat of a high-tech CMO.  It’s been just a little over a month since joining my new company, Aprimo.

What is going on in the Marketing Automation space, let alone here at Aprimo, is just too exciting not to jump in.  Name it. Budgets are slashed so B2B and B2C marketers are flocking to improve pay per click management, organic search, social media and blogging to reach new prospects and consumers at a fraction of the cost.

Guess what happens when marketers flock?  Innovation occurs. And as B2B marketers try to scale and B2C marketers try to entice...CMOs like myself are looking to automate not populate to get more personal and more relevant with their marketing strategies and tactics.

Enter Aprimo. Our flagship product, Aprimo 8.5, automates the hard work of marketing -- budgets and financial planning, mass amounts of digital assets as well as integrated, multi-campaign management.  Our new product line, Aprimo Marketing Studio, offers a suite of software as a service applications for interactive marketing -- including the blog I'm writing...as well as microsite tools, pay per click management and social media optimization.

So as Aprimo's CMO -- my team and I get to innovate our own marketing efforts -- and those of some of the most savvy marketers on the planet.

Can you blame me for jumping back in? Come join me -- let's talk about how we can innovate together.