Marketing professionals from Allison & Partners, Corporate Express U.S., Townsend and Townsend and Crew, and CMOPro on: Tracking ROMI: Getting More Out of Your Marketing Investments Scott Allison President and CEO, Allison & Partners Kerr Holbrook SVP and Chief Marketing Officer, Corporate Express U.S., Inc. Brian Colucci Director of Marketing, Townsend and Townsend and Crew LLP Daniel Greenberg CEO, CMOPro Inc. (Former CMO, Tumbleweed Communications) M arketing metrics may never be able to identify all factors that lead to sales. However, thanks to the development of the Internet and other measurement tools, the science of marketing has, indeed, become more precise within the past 10 years (in the sense that it can now track response rates and competitor data). But, along with these more sophis- ticated tracking methods have come more demanding clients, clients that want to apply ROI operational metrics to the often-ineffable process of attracting new customers. How can today’s marketing firms and depart- ments satisfy this demand for quantifiable returns in a world of fickle cus- tomers? This ExecBlueprint discusses how marketers can now take advantage of the latest marketing principles to plan campaigns, set targets, and pre- dict results. Using specific examples, four marketing professionals share how a combination of high-tech tracking methods and old-fashioned employee motivational practices enabled their companies to demonstrate a satisfactory ROMI on many marketing campaigns. ■ in partnership with Aspatore Books ™ Exec Blueprints www.execblueprints.com Action Points I. Which Best Practices Help a Marketing Campaign Pay Off? A marketer’s traditional levers may be the message, the creative, the call to action, and the offer — but when should you use which? In order to reap a maximal ROMI, you must choose marketing approaches that are attuned to the history of your client or company’s product/service, the goals of the company, and the motivations of its customers. II. The Bottom Line Even though it can often be difficult to quantify the value of a marketing campaign, today’s CEOs still want to know how well their investment is performing. In order to demonstrate the most “bang for the buck,” establish expectations up front that are based on past budgets, reliable benchmarks, solid pilot testing, and realistic revenue projections. III. Must-Have New Measuring Tools for Determining ROMI Thanks to the Internet and other new technologies, today’s marketer has many more options for tracking the return on marketing investments. Some metrics, such as media exposures and Web visits, can even be tracked in real time. IV. The Golden Rules for Working with Leadership and Staff to Maximize Your Marketing Investment If you want your staff to create and deploy innovative campaigns that will return a maximal ROMI for your client or company, you should foster an environment that keeps the creative juices flowing, establishes clear, measurable campaign goals, and rewards with bonuses or other incentives when expectations are exceeded. V. Essential Take-Aways Marketing may still not be a precise science, but new technologies and approaches can now help answer questions such as: What type of customer should the client/company target? Where is the client/company receiving mentions? What was the response to the newspaper article? — all of which can help track a cam- paign’s ROMI. Contents About the Authors . . . . . . . . . . . . . . . . . . . . p.2 Scott Allison . . . . . . . . . . . . . . . . . . . . . . . . . p.3 Kerr Holbrook. . . . . . . . . . . . . . . . . . . . . . . . p.8 Brian Colucci . . . . . . . . . . . . . . . . . . . . . . . p.11 Daniel Greenberg . . . . . . . . . . . . . . . . . . . p.14 Ideas to Build Upon & Action Points . . . p.17 Copyright 2008 Books24x7®. All rights reserved. Reproduction in whole or part is prohibited without the prior written permission of the publisher. This ExecBlueprints™ document was published as part of a subscription based service. ExecBlueprints, a Referenceware® collection from Books24x7, provides concise, easy to absorb, practical information to help organizations address pressing strategic issues. For more information about ExecBlueprints, please visit www.execblueprints.com.
Transcript
Marketing professionals from Allison & Partners, Corporate ExpressU.S., Townsend and Townsend and Crew, and CMOPro on:
Tracking ROMI: GettingMore Out of Your
Marketing InvestmentsScott Allison
President and CEO, Allison & Partners
Kerr HolbrookSVP and Chief Marketing Officer, Corporate Express U.S., Inc.
Brian ColucciDirector of Marketing, Townsend and Townsend and Crew LLP
Daniel GreenbergCEO, CMOPro Inc.
(Former CMO, Tumbleweed Communications)
Marketing metrics may never be able to identify all factors that leadto sales. However, thanks to the development of the Internet andother measurement tools, the science of marketing has, indeed,
become more precise within the past 10 years (in the sense that it can nowtrack response rates and competitor data). But, along with these more sophis-ticated tracking methods have come more demanding clients, clients thatwant to apply ROI operational metrics to the often-ineffable process ofattracting new customers. How can today’s marketing firms and depart-ments satisfy this demand for quantifiable returns in a world of fickle cus-tomers? This ExecBlueprint discusses how marketers can now take advantageof the latest marketing principles to plan campaigns, set targets, and pre-dict results. Using specific examples, four marketing professionals share howa combination of high-tech tracking methods and old-fashioned employeemotivational practices enabled their companies to demonstrate a satisfactoryROMI on many marketing campaigns. ■
in partnership with Aspatore Books
™ExecBlueprints
www.execblueprints.com
Action Points
I. Which Best Practices Help a Marketing CampaignPay Off?A marketer’s traditional levers may be the message, thecreative, the call to action, and the offer — but whenshould you use which? In order to reap a maximal ROMI,you must choose marketing approaches that are attunedto the history of your client or company’s product/service,the goals of the company, and the motivations of its customers.
II. The Bottom LineEven though it can often be difficult to quantify the valueof a marketing campaign, today’s CEOs still want to know how well their investment is performing. In order todemonstrate the most “bang for the buck,” establishexpectations up front that are based on past budgets, reliable benchmarks, solid pilot testing, and realistic revenue projections.
III. Must-Have New Measuring Tools for DeterminingROMIThanks to the Internet and other new technologies, today’s marketer has many more options for tracking thereturn on marketing investments. Some metrics, such asmedia exposures and Web visits, can even be tracked inreal time.
IV. The Golden Rules for Working with Leadership and Staff to Maximize Your Marketing InvestmentIf you want your staff to create and deploy innovative campaigns that will return a maximal ROMI for your clientor company, you should foster an environment that keepsthe creative juices flowing, establishes clear, measurablecampaign goals, and rewards with bonuses or otherincentives when expectations are exceeded.
V. Essential Take-AwaysMarketing may still not be a precise science, but newtechnologies and approaches can now help answer questions such as: What type of customer should theclient/company target? Where is the client/companyreceiving mentions? What was the response to the newspaper article? — all of which can help track a cam-paign’s ROMI.
Copyright 2008 Books24x7®. All rights reserved. Reproduction in whole or part is prohibited without the prior written permission of the publisher. This ExecBlueprints™ document was published as part of a subscription based service. ExecBlueprints,a Referenceware® collection from Books24x7, provides concise, easy to absorb, practical information to help organizations address pressing strategic issues. For more information about ExecBlueprints, please visit www.execblueprints.com.
Scott Allison is the president and CEOof Allison & Partners, a SanFrancisco-based public relations firm
with offices in New York, Washington,D.C., Los Angeles, Orange County, andSan Diego that represents a wide rangeof clients in technology, professional ser-vices, and consumer products. Marqueeaccounts for the five-year-old firm includeYouTube, Best Western International,Sony, and ARAMARK.
Prior to starting Allison & Partners inSeptember 2001, Mr. Allison served as
president of Connors Communications,an emerging technology communica-tions firm that launched such notewor-thy companies as Priceline.com andAmazon.com.
Over the course of his career, Mr.Allison has developed a strong back-ground in the area of community rela-tions and public affairs. As a partner withThe Gable Group in San Diego for 12years, he worked on many public affairsprograms, including the San DiegoChargers, County of San Diego Tobacco
Education program, Air PollutionControl District, and Pardee Homes.
Prior to joining The Gable Group, Mr.Allison was a manager with DirectCommunications, a San Diego-based polit-ical consulting firm. While there, heworked on the 1986 Texas governor’s raceand Louisiana Senate campaign. Previously,he served as deputy communications director for U.S. Senator Pete Wilson.
Scott AllisonPresident and CEO, Allison & Partners
☛ Read Scott’s insights on Page 3
Since November 2006, KerrHolbrook has been senior vice pres-ident and chief marketing officer for
Corporate Express, U.S. In this role, Mr.Holbrook is responsible for the develop-ment and execution of all elements of Corporate Express’ marketing and e-business strategy across its $4 billionportfolio of office products, facility supplies, and furniture businesses.
Prior to joining Corporate Express,Mr. Holbrook was vice president of strat-egy and marketing for McKessonSpecialty, where he contributed to double-digit growth across McKesson’s group of pharmaceutical distribution and technology businesses.
Earlier in his career, Mr. Holbrook ledstrategy and marketing engagements forthe management consulting firm, Edgar,
Dunn & Company, and held leadershippositions in marketing and sales with EliLilly & Company and the start-up,PlanetRx.
Kerr HolbrookSVP and Chief Marketing Officer, Corporate Express U.S., Inc.
☛ Read Kerr’s insights on Page 8
Brian Colucci is the director of mar-keting and business development ofTownsend and Townsend and Crew
LLP, a 200-attorney law firm specializingin intellectual property acquisition, liti-gation, and counseling. He is responsiblefor all aspects of the firm’s marketing andbusiness development strategy and works
closely with the firm’s management com-mittee, practice group leaders, andregional office leaders to develop firm-wide marketing strategy and execute on various marketing and business development initiatives.
Mr. Colucci has more than 12 yearsof experience in legal and professional
services marketing. For most of hiscareer, he has focused on marketing andbusiness development strategy for intel-lectual property law firms and intellectualproperty-related practice areas.
Brian ColucciDirector of Marketing, Townsend and Townsend and Crew LLP
☛ Read Brian’s insights on Page 11
Daniel Greenberg has two decadesof leadership experience in strat-egy, marketing, and product man-
agement. At Tumbleweed he is responsiblefor company and product strategy, cor-porate marketing, product managementand marketing, and field marketing.
Prior to Tumbleweed, Mr. Greenbergwas vice president of worldwide marketing and product management for
Macrovision’s Software TechnologyGroup whose product lines includedInstallShield & FLEXnet. Sales grew four-fold under his leadership. Prior toMacrovision, he founded ActiveDecisions, a pioneer in the e-commerceapplications market. The company wasacquired by KNOVA Software (NASDAQ: KNVS).
Previously, Mr. Greenberg was vicepresident of global marketing forACNielsen. He has also held strategicmarketing positions with Dun &Bradstreet, General Motors, and a variety of management consulting firms.
Daniel GreenbergCEO, CMOPro Inc. (Former CMO, Tumbleweed Communications)
☛ Read Daniel’s insights on Page 14
GoalsMarketing is now playing an ever-increasing role in business. Mostinteresting has been the evolution ofpublic relations within the market-ing mix over the past decade. PRhas long played second fiddle toadvertising. Ad agencies and theirin-house counterparts would oftencreate the strategic vision for mar-keting, and PR was left to pick upthe scraps and manage tactically.
This has changed radically overthe last decade, and particularlyover the last five years. With com-panies seeking optimal return ontheir marketing investment, clientsare increasingly relying on publicrelations to reach target audiencesat a lower cost than advertising.Moreover, many small- to mid-sizeclients no longer have advertisingagencies of record and are insteadfocusing their marketing expendi-tures on public relations. BestWestern Hotels, for instance,recently dropped a significant adver-tising budget to reallocate and up-weight their spend on publicrelations (“get a bigger bang for thebuck”).
Every client has different ROMIrequirements, and therefore a dif-ferent target to reach. It is difficultto take one formula and make itgeneric to every company. After first
drawing up a mutually-derivedvision of success, you and theclient can draw from a broad arsenal of measurement tools.
Measures of SuccessIn order to establish ROMI goals,however, you must ensure thateveryone is on the same pageregarding what is expected andwhat success looks like by:
• Creating measurable objectives— conduct benchmark studiesto determine the framework ofhistorical client results: anyfuture payoff cannot be ade-quately benchmarked withoutinsight into the efficacy of pastexpenditures.
• Tying PR objectives to businessgoals — ensure the PR pro-gram is closely aligned with theoverall business goals of theorganization.
• Conducting a media audit —know the media’s impressionsof a company. This is key tounderstanding the future success of the program.
• Performing a competitiveanalysis — gain a keen understanding of how the competition is perceived.
These fundamental elements areessential for reviewing the ongoingsuccess of a campaign.
In most PR firms, employees arewell aware that the success of thefirm is contingent upon the successof its clients. Allison & Partners hasa bonus program that is based onthe results and success for eachoffice, which is often defined as theamount of revenue generated aswell as the incremental revenuederived from growing existingaccounts. Because they want to bepart of a winning team and a grow-ing company, team members alwayswant to know how the company isdoing. To attract candidates, we
Scott AllisonPresident and CEO, Allison & Partners
No measurement program will look the same; theprocess really begins with defining what successlooks like for a client and, from there, assemblingmeasurement benchmarks appropriate to theprogram (e.g., Web site traffic, employeeretention, customer satisfaction, lead generation).
Scott Allison
President and CEOAllison & Partners
employ the same strategy. If you canarticulate to a potential hire thatthere are clear metrics in place formeasuring company and individualsuccess, then that person is morelikely to be better motivated andincentivized. That is the way toencourage employees to support theROMI goals.
Best Practices at WorkBest practices for achieving a highreturn on investment include mak-ing sure a measurement program iscustomized to individual clientneeds. No measurement programwill look the same; the processreally begins with defining whatsuccess looks like for a client and,from there, assembling measure-ment benchmarks appropriate tothe program (e.g., Web site traffic,employee retention, customer satisfaction, lead generation).
Memorable marketing programsinclude:
• Best Western Hotels, theworld’s largest hotel company,was celebrating its 60thanniversary in 2006. The measurement that was mostimportant to this organizationwas gross impressions. From ameasurement standpoint, this
criterion was built into everysenior marketing professional’sbonus program. BWH had setan aggressive goal of generat-ing 1.2 billion media impres-sions for the year. Everyone onthe client account team wasaware of the goal, and monthlyupdates to review progresswere put into place. Both theinternal Best Western PR teamas well as our PR team workedclosely to maximize the coverage for the year. Due toan aggressive and creative program that ran for 12months, we were able to generate a staggering 1.9 billion impressions during thecourse of the year.
• ZipRealty. What started as afledgling dot-com company in1999 has now blossomed intoa publicly-traded real estatebrokerage powerhouse thatnow operates nationwide. TheZipRealty brand was built forthe most part through publicrelations (the company hasshunned traditional advertis-ing). They have been able toclosely track traffic to the Website as well as lead generationthrough public relations activity. In this case, PR had a
substantial impact on buildingthe ZipRealty brand.
• In 2005, Allison & Partnerswas retained by Fluid AudioNetworks to help drive aware-ness of their new online prod-uct offering, American IdolUnderground. Our firm recom-mended that the company capitalize on their relationshipwith FremantleMedia toannounce the new product inconjunction with the LicensingShow in New York City.However, at the time of thelaunch, Fluid Audio had notengaged the celebrities of thepopular TV show to use formedia appearances and hadlimited budget resources.Nevertheless, we were able todevelop a strategy that resultedin 213 million media impres-sions internationally and generated significant consumerinterest (via captured e-mail) toestablish a built-in customerbase for launch.
• Allison & Partners was hiredby the Bay Area Air QualityManagement District to pro-mote its “Spare the Air” program, which educates thepublic about summer air pollution and encourages
Scott AllisonPresident and CEO, Allison & Partners (continued)
I worked with Nordstrom to launch the Nordstrom.com Web site in 1999, inthe midst of the pre-bust e-commerce and Internet hype. The agencychallenge was to garner awareness for this inaugural Internet launch. Wedeveloped a promotion called “Shoes for Life,” where consumers could go toNordstrom.com to enter the promotion. Over 90,000 people subscribed tothe program in a three-week period, and the site received significant mediatraffic.
Scott Allison
President and CEOAllison & Partners
air-friendly behavior through-out the nine-county SanFrancisco Bay Area region. Tothis end, the Allison team con-ducted a media relations cam-paign in 2006 that increasedthe number of residents whoreduced driving on smoggydays by 34.8 percent, and thenumber who took advantage ofa free transit program by 128percent. This far exceeded theprogram goals and made the2006 “Spare the Air” campaignthe most successful in the program’s 15-year history.
As an agency, we recognize theimportance of the marketing invest-ment. We ourselves have an activemarketing campaign: over the next12 months, we will launch a brandnew Web site, develop a new adver-tising campaign, and test a newdirect mail program. In addition, wecontinue to pursue other public rela-tions efforts, which includes devel-oping press releases on new clientwins, speaking engagements, specialevents, and other promotions.
Our current marketing budget isdivided as follows:
• 50 percent advertising
• 25 percent online
• 25 percent PR
Measuring ResultsAs a public relations firm, we areobligated to measure and quantifyour clients’ investment in publicrelations and communications.Clients consistently want to knowhow a program is performing andthe efficacy of their investment. Inparticular, they want to know thecorrelation between the programexecution and its impact on the
bottom line. “Who did we reach?”“Did it elicit a response?” “Did itadvance a relationship, produce alead, or make a sale?”
All companies are under pressureto justify their marketing expendi-tures, and the sophistication of pro-gram measurement has increased,along with the growth of onlinemarketing and precise ROI map-ping tools. PR firms use many ofthese different tools and method-ologies to measure programs, andsome have evolved with the adventof new technologies and access togreater online research methodolo-gies. The best practices of PR meas-urement have evolved over thepast decade in response to the capa-bility of new technologies to gatherand study coverage with greaterspeed and degree of automation.
Some of the tools routinely usedare:
• Media Clipping Services(Burrells, Vocus, etc)
• Online tracking services(Google News, etc.)
• Media Audits
• Internal Audits
Gauging the Effects ofMedia ExposureMethodologies have been aided bythe explosion in online resources, atrend that is sure to continue at anaccelerated pace. Ten years ago,clients would often remark: “50percent of my marketing investmentis paying off. If only I knew whichhalf.” Now, with the migration ofmarketing onto the Internet, clientscan say: “90 percent of my mar-keting investment is paying off andI am going to eliminate the 10 percent that I can identify as not
working.” Until recently, PR agen-cies were still using clipping servicesto send clips or media placements toclients. In some cases it would take60 days or more for the relevantclips to show up. Now, clips ormedia placements can be retrievedonline in real time.
The Internet is thus now a coremarketing strategy for many com-panies, and entire campaigns aredeveloped around Web-based mar-keting. However, because the major-ity of companies are now utilizingthis technology, there is no longera competitive advantage in using theInternet.
Many other metrics are alsomeasured in the marketing com-munications mix. One of the pri-mary PR areas that companiesfocus on is media coverage. Successin media has historically been meas-ured by clips and gross impressionsgenerated. This, however, is a some-what dated and misleading way ofstudying coverage. While grossimpressions provide a snapshot ofthe bulk coverage or mentions thecompany has attained, they seldomprovide a solid insight into the quality of the coverage.
An example of how gross impres-sions can present a misleadingimpression:
A murder takes place at a large,national convenience store. Thestory is picked up in local andregional news. Each time the storyruns, it mentions the brand name ofthe national convenience store. In agross analysis of gross impressions,the numbers of brand exposuresrelated to the murder story willshow up as mentions of the convenience store brand.
The right way of looking at grossimpressions is to drill down a layer
Scott AllisonPresident and CEO, Allison & Partners (continued)
and look at the impact. This wouldinclude reviewing:
• The content of the impressions— studying the quality of theplacement to ensure that itaccurately portrays the mes-sage(s) a company is trying toconvey, and that the companypositioning is accurate
• The type of media — achievinga well-placed piece in a fairlyobscure trade publicationcould conceivably have morevalue if it correctly captures acompany’s message(s) than anoff-message mention in theWall Street Journal. Qualityover quantity is definitely afactor.
• The competitive positioning —tracking how the client isdoing against its competitionand how it is positionedagainst the competition
• The call to action — determiningthe impact for generatingphone calls, sales, or otherleads based on the placement
As an example, our firm wasworking with SideStep, a start-up inthe online travel space, which hadan innovative business model.Through media relations outreach,interest was generated from ParadeMagazine and the Sunday insert ranan article on the client. The dayafter the article ran, SideStep’sservers crashed due to heavy Website traffic. This as a great exampleof measurable impact.
There are many other elements ofa marketing communications pro-gram that can be measured andmapped back to successful outreach,including:
• Web site traffic and hits, par-ticularly tied to the timeframeof when media coverage wasgenerated
• Community relations
• Traffic to special events
• Media briefings
• Stock volume trading and pricemovements
• Funds raised
• Market valuation
• Calls to 1-800 numbers
• Public affairs
Benchmarking SuccessAgainst Past HistoryAn understanding of a client’s pasthistory, however, is critical before
you can move forward. The mostuseful benchmarks are obtained bygauging what the target audiencethinks about a company over dif-ferent time periods. There aremany effective ways to do thisthrough media audits, which tendto be conducted more frequentlyby some agencies than others.Audits allow agencies to interactwith the media and ask directquestions about their impressionsof a particular company and thecompetition. These key insights areessential in developing a mediarelations campaign and reviewingprogress over time.
Reputation is paramount. PRfirms know they have two audiences:clients and employees. Therefore, keymethods for benchmarking a brand’ssuccess are conducting customerresearch and learning internal
Tie PR objectives to business goals — ensure the PR program is closely aligned with the organization.
Conduct a media audit — know the media’s impressions of a company.
Perform a competitive analysis — gain a keen understanding of how the competition is perceived.
4 Key Steps to Establishing ROMI Goals
employee opinions. At Allison, wework hard to understand how bothaudiences feel. Internal communica-tions are taking on a much broaderrole as companies realize employeesare the true ambassadors of anorganization and a major touchpoint. We conduct regular employeesurveys and one-on-one meetingswith each employee.
With clients, we find the bestgauge of satisfaction is if theywant to continue working with us.Tracking customer response inother ways, however, can be diffi-cult. The most vocal customers areoften the ones that are mostunhappy. Satisfied customers andraving fans tend not to vocalize theiropinions to the same extent. Thekey to studying customers is to
gather a variety of sources and getfeedback that’s as objective as pos-sible. This will establish the appro-priate benchmarks for moving theorganization forward and gaugingthe success of future marketing programs.
Future TrendsClients are demanding more andmore sophistication in measuringtheir PR programs because they arebeing pressured by the Board ofDirectors on down to justify all mar-keting investments. This trend willcontinue — and if there is a slow-down in the U.S. economy, you willsee increased pressure and scrutinyon marketing expenditures across theboard. In a growing economy, clients
are more apt to invest in marketingand are willing to pay for the nec-essary research required to conductmeasurement. In a contracting mar-ket, cost-cutting comes into play, andsome of these elements may be thefirst to go. Companies are sensitiveto their competition and are quick tomirror competitive initiatives. Bothin types of programs and in meas-urement practices, PR firms can havea tendency to “follow the leader.” ■
Scott AllisonPresident and CEO, Allison & Partners (continued)
Driving ROI and ReachingTargetsI think our company uses a prettystandard return-on-investment model.We look at the cost of the campaignversus the gross profit that the cam-paign generates and that calculationdelivers your return on investment.I have used this method historicallywith a reasonable amount of suc-cess. Each campaign has an ROItarget, and then the campaign ismeasured against that target. Thereare some exceptions, like awarenesscampaigns, which we might notmeasure due to the difficulty in measuring impact. Instead, we might evaluate awareness measurements on an annual basis.
The key to reaching ROI targetsis to establish a target or objectiveat the front end of the campaign.You then focus on the most likelycustomers that might respond to thecampaign. For us that means con-ducting detailed segmentation andfocusing on a finite target marketthat allows us to drive the desiredROI. This is especially importantwhen you can assume that there issome cost for each incremental tar-get or customer that you put intothe campaign.
We also use pilots involving asmall initial investment to ensurethat we reach ROI goals with ourlarger campaigns. If we are launch-ing full scale right off the bat, wewill almost always use test and con-trol groups so that we can see whatworked and what didn’t, and enableus to learn for subsequent cam-paigns. While this approach may bea little more expensive and may notyield absolutely consistent results, ayear from now we will have a prettypowerful set of launched cam-paigns that will tell us what worksand what doesn’t.
The Purity QuestionThe biggest challenge when tryingto meet your ROI goal is the purityquestion, and every marketingexecutive faces it: what noiseimpacted the campaign? Could asalesperson have gone into thatparticular account and influencedit? Could they have seen one of ourvehicles and ordered based on the vehicle’s messaging?
Lack of purity in the analysisalways causes some consternation,but if you have partnered well withyour sales colleagues and others onthe management team, I thinkeverybody will realize that it is nota zero-sum game. If I generate a newcustomer, or if I generate more rev-enue, that doesn’t mean that I tooksome away from you, it just meansthat holistically we have progressed.However, if you take a zero-sumgame mentality that believes “if Iwin, you lose,” you are alwaysgoing to face opposition as you arepresenting the return on investmentresults. But if your success is viewedas an adjunct to the other saleschannel and marketing activities,you will get to where you need tobe.
Achieving Buy-InThroughout the CompanyThroughout the rest of the com-pany, I think the marketing functionis viewed on a continuum. Theopinion will depend on whom youtalk to, what their role is, and whattheir experience with marketing hasbeen. I think there are folks thatonly see the top of the icebergregarding what we do. During myfirst week here, I heard all sorts ofideas about promotions and color
“I position the marketing function as anorganization that is primarily an adjunctand a supporter of the sales process.We don’t make the sales, but we makethem easier. In many cases, we can alsoinfluence customer buying behavior.”
• With company since 2006
• Responsible for development and execution of marketing and e-business strategy
• Previously VP, strategy and marketing, McKesson Specialty
• Bachelor’s degree, University ofKansas
• Master’s degree, Management,Northwestern University’s KelloggGraduate School of Management
Kerr HolbrookSVP and Chief Marketing Officer, Corporate Express U.S., Inc.
The biggest challengewhen trying to meetyour ROI goal is thepurity question, andevery marketingexecutive faces it: whatnoise impacted thecampaign?
Kerr Holbrook
SVP and Chief Marketing OfficerCorporate Express U.S., Inc.
schemes and things like that.However, as you educate the organ-ization around what marketing cando, you can gradually turn theminto advocates who recognize thatmarketing is more of a strategicfunction.
Our marketing initiatives areabsolutely supported throughoutthe rest of the company. I am notsaying that we get to do everythingwe want, but most of what we doimpacts other parts of the company,from the sales organization to our operations team which runs ourcustomer care center, to the financegroup who assists with reporting tothe people that run the campaign.You need to have universal supporton almost any campaign or program to make it work.
Challenges that may arise whileworking with other departmentsusually stem from a lack of collab-oration on the front end in terms ofthe objectives and strategies behindthe campaign. A key element in get-ting senior management support isincluding the overall team in yourmarketing planning at the front end,and making sure that they under-stand what your objectives are forthe year — from a financial andbranding perspective. You mustcoordinate what the marketingplan looks like as well as its objec-tives, timing, and targets and thenhave the management team agreewith that. If there is open commu-nication, the plan generally will endup with fewer issues. Ensuring thatthe other functions know where weare headed and why we are goingthere is how we try to address it.And, if you can get the support ofsenior management early on, it is alot harder for somebody else tothrow a stick of dynamite into yourplan.
Segmentation andTargetingOur department’s best practices forachieving ROI are segmentation andtargeting. These are absolutely criti-cal. We do many fewer mass mailcampaigns than were done in the past(we don’t use the mail if we can usee-mail). Marketing is way past thatnow, and this savings will always helpyour return on investment. We don’t
contact a thousand if we can contacta hundred really good prospects.
It is hard to say if this is simi-lar to the way the rest of the indus-try works. A lot of our competitorsare very retail- and consumer-focused, and therefore do a lotmore brand building and aware-ness campaigns. I think we areprobably a little more focused thanour competitors in terms of how
Kerr HolbrookSVP and Chief Marketing Officer, Corporate Express U.S., Inc. (continued)
5 Approaches That Have Proven Effective in Reaching ROI Targets
Establish an objective at the front end of the campaign.
Base the ROI on your historical success with similar campaigns.
Segment your markets, and plan focused strategies for your most likely customers.
Conduct pilots to test ROI assumptions.
Measure on the back end to see how your campaign performed relative to
what was contemplated initially.
we run our campaigns. Conse-quently, we are less willing to com-promise and do mass-mailing-typecampaigns.
At our company, marketing gen-erally leads the process in estab-lishing ROI goals. Based on ourhistorical success with similar cam-paigns, we can estimate ROI priorto launching a campaign and thenmake sure we measure against thatgoal.
Helping Employees to HelpYou Achieve ROIFor us, managing to a program ROIis a fact of life. We’ve developed ourmarketing processes around ensur-ing ROI. Consequently, if you wantanything to touch our customer, youneed to go through a process thatincludes a buy-in from our financialdepartment to generate a predictedROI for the campaign. This is thenmeasured on the back end to seehow it performed relative to whatwas contemplated initially. It is
motivated not only by necessity; itis a process requirement.
Our goals also influence our hir-ing process. We share informationabout campaigns that individualmarketers have run as well as ourexpectations that have arisen as aresult of being a data-driven andquantitative marketing organiza-tion. The hope is that we will findlike minds; fortunately, there aremany more of them today thanthere were 10 years ago.
Integrated CampaignsOur top campaigns are alwaysintegrated and include more thanjust one marketing vehicle. Thecampaign could include our salesforce, e-mail, direct mail, and anumber of different vehicles that wewould use to try and drive the par-ticular campaign. I think this inte-gration is critical, and generallythose campaigns that are accom-panied by some sort of educationalmessage for our customers tend todo better than others — in other
words, something that benefits ourcustomers does better than a sim-ple offer. Our positioning is basedaround productivity and supportingour customers to do more with theirtime, so to the extent that we canpromote those types of messages,we make our promotions consistentwith our branding.
Conducting a better-targeted cam-paign is also critical. In our industrywe utilize “firmographics” in addi-tion to demographics, because inaddition to marketing to individuals,we also market to organizations. Themore you know about their behav-ior, how they act, what they are inter-ested in, and the vehicles throughwhich they like to learn about yourproduct and your company, the moreimpact you will have. ■
Kerr HolbrookSVP and Chief Marketing Officer, Corporate Express U.S., Inc. (continued)
We are in the process of insourcing our marketing database. Originally wehad an outside partner managing it but, as we’ve grown and become morecomplex, we’ve come to the conclusion that insourcing will allow us more flexibility and improve our time to market. We anticipate minimizingdelays in running campaigns or segmentations, which ultimately will allowus to run more and better campaigns. This is something that we had to sellto senior management. Our argument centered, first, on return oninvestment (or net present value of insourcing versus outsourcing), andsecond, on increased marketing effectiveness and the ability to generateincremental sales.
Kerr Holbrook
SVP and Chief Marketing OfficerCorporate Express U.S., Inc.
Our Current MethodsTracking return on marketinginvestments is always a difficulttopic for professional services mar-keters because we don’t have a clearpoint of sale. We can rarely if eversay that we were the sole reason anew client came to the firm. Forexample, I can write a proposal forone of our partners and do every-thing to help them deliver it, but atthe end of the day if it is success-ful, I can’t honestly say that I viewthose dollars as a return on mar-keting efforts. I can make the argu-ment, but it is very difficult toprove.
The things that I use to measureROMI are often both quantitativeand qualitative. I keep track of everyproposal that we make. I trackwhether it was a current client or apotential client, what industry theclient is in, what kind of fees theypaid us in the past, etc.
At the end of the year or at peri-odic intervals, for example, I can saywe pitched a certain number ofclients over a given time period andour success rate for the new mattersthat we opened was X, while ourgross revenue was Y. I can presentmy report to management, but it isup to them to decide if it is accept-able as a rate of return. There arevery few benchmarks and a lot ofintangibles.
Another measure for manage-ment is the level of satisfaction thatour partners have. If our manage-ment team has partners that com-plain that they can’t get businessdevelopment resources, this feed-back detracts from our overalleffectiveness as a firm. There isvalue for our management in nothaving to manage the marketingfunction too closely but, again, it’shard to translate that into dollars.
The Company’s View ofMarketingThe marketing function is somewhatmysterious for a lot of non-lawyers,but our partners, who are veryinvolved in bringing in work, viewit as being critical. I work very closelywith a small number of partners andI don’t have a lot of interaction withother staff.
There is some confusion aboutwhat we can control and what wecan’t. For example, there is a lot ofconfusion about the editorialprocess. If somebody reads some-thing negative about our firm in thepaper, they will ask why we let ithappen. I can’t control what comesout of a reporter’s mouth. I can’t callthe paper and complain unless theyare absolutely wrong.
Motivating EmployeesThere is a tendency to work in silosin law firms, but we try to make sureour people have a sense of the over-all vision of the firm by giving themthe necessary information wheneverwe have it. The same principles that apply to external communi-cation apply to internal com-munication: if you have news toreport and you know that there isrampant speculation, it is usuallywise to “get out in front” byexplaining the news as soon as youare able.
Brian ColucciDirector of Marketing, Townsend and Townsend and Crew LLP
Absent some kind of regular reporting on thesuccess or failure of various initiatives, there isthe risk that successful tactics will not receive therecognition (and repetition) they deserve and thatfailed tactics will continue.
Brian Colucci
Director of MarketingTownsend and Townsend and Crew LLP
For example, when we recentlyopened a new regional office, wegot to a point where we hadn’tannounced anything yet, but theword was starting to get out. Wedecided to let our staff know aboutthe office opening two or threeweeks before we announced it pub-licly. They appreciated knowingahead of time, and were veryexcited about our new office. Theyalso felt invested in the projectbecause they were trusted withinside information. This type ofcommunication gets people think-ing about how they can worktogether as a team to improve products for clients.
Best PracticesIn order to achieve a better returnon marketing investment, the bestpractice is looking at revenue andbudget. We look at what we spentthe year before and have a seriousconversation about whether or notit is still working.
When I meet with various prac-tice groups in different offices, I listwhat we did and how much wespent. Then we try to determine asa group whether we think those
practices are worth doing again. Itis important to pay attention to rev-enue, because otherwise you are justdoing things because people wantyou to do them or because theymake people feel good. Instead, youalways need to bring the focus backto results.
Periodic reporting to firm man-agement, practice group leaders,and office leaders is also veryimportant to maintaining supportand “buy-in” to marketing initia-tives. It takes a certain amount ofdiscipline to actively track results,whether it’s success in responding toproposals, media mentions, con-ference attendance, or any numberof other metrics. In the legal
profession, there are very fewaccepted objective measures of suc-cess, so we are limited to recordingthose aspects of our strategy that wethink are relevant and then tryingto determine as a group wherethings are going right or goingwrong.
For example, there are outsideservices that will monitor mediamentions and try to rate perceptionsof the company based on the fre-quency and tone of mentions. Thistype of analysis does not reallywork for law firms, but the princi-ple is a good one. So we have set upour own rating criteria. We track,on a scale of 1 to 10, various aspectsof every story that mentions our
Brian ColucciDirector of Marketing, Townsend and Townsend and Crew LLP (continued)
Working with Senior Management
Our administrative team works closely together and we meet frequently as a groupbecause we are working on so many interrelated things. For example, we just openeda new office and have held weekly meetings of the various administrative func-tions to manage all of the aspects of the new office.
I have to talk to the facilities person about when we are going to sign the leasebecause it drives announcements and our immediate strategy. I have to work withour librarian to get research on the market and descriptions of various regionalpublications. We are in constant communication as a group and put a lot of effortinto working together collaboratively.
1 2 3 4 5 6 7 8 9 10
Every media mention receives a score from 1 to 10 . . . on:• Tone (positive or negative)• Relevance of the publication (legal as opposed to mainstream media)• AccuracyData is then reviewed at regular intervals.
Rating Criteria for Media Exposures
firm or our attorneys. We track criteria such as tone (positive ornegative), relevance of the publica-tion (legal as opposed to main-stream media), and accuracy. Theseare criteria that we can track on aregular basis and that can yieldsome useful data when reviewed atregular intervals.
Absent some kind of regularreporting on the success or failure
of various initiatives, there is therisk that successful tactics will notreceive the recognition (and repeti-tion) they deserve and that failedtactics will continue. If the firm ispursuing initiatives that haveyielded little or no result, there is noreason to continue with them.Unfortunately, however, if no one iswilling to shine the light on badpractices, they are often repeated.
All of this measuring, of course, hasto be done both honestly and witha certain amount of humility. It is notabout “blowing your own horn”regarding successes — you alsohave to take an honest look at whathas failed and take responsibility. ■
Brian ColucciDirector of Marketing, Townsend and Townsend and Crew LLP (continued)
Our Current MethodsWe track campaign ROMI and PRROI. Tracking return on investmentfor marketing campaigns is knownas the right thing to do in our indus-try, even though I have worked formany companies that did not do it.Marketers are creative, right-brained people, and analytics andtracking ROI are left-brained activ-ities. This dilemma presents one ofthe fundamental challenges in themarketing arena.
You always read about earninga seat at the table with the CEO, butthe CEO is all about numericresults. If he or she is investing $2million in marketing, s/he wants toknow what s/he is getting in return.He or she does not necessarily careabout how creative or flashy a campaign is.
Most companies, however, donot measure return on investmentfor PR. They track hits, which is thenumber of mentions of a companyin the general press. We assess thevalue of the hits on the publication’sadvertising rates. If we get a men-tion in Forbes or the Wall StreetJournal, for instance, we base ourreturn on what the Journal ’s adver-tising rate would be for that size ofmention. Our investment is howmuch we are spending with our PRcompany.
Our target return on investmentis anything significantly north of100 percent. This means that we get
back our original investment andthen some. If we invest $100 in acampaign and get $200 back, ourROI is 100 percent.
Right now, we’re at about 30percent, but we will improve on thatnumber over time. I encourage myteam to experiment and fail quickly.I want them to try a lot of differ-ent things and track what’s work-ing and what’s not. We jettison thethings that aren’t working andpour money into the things that dowork.
ChallengesOne of the challenges that we facein calculating ROI lies is the factthat it’s hard to isolate variables,particularly in B2B marketing. Wehave to determine whether weattracted a customer with the e-mails we sent, with an ad they sawin a magazine, or with our sales representative’s direct contact.
In order to do marketing right,it’s generally believed that you’resupposed to do integrated market-ing, which means hitting the targetbuyer from many different angles.The film Ratatouille is everywhere.Do you know if you decided to seethe movie based on the ad you sawon a cereal box, the online trailer,or the commercial on television?
The Web is wonderful, because itmakes things a lot more measurable,but if you’re dealing with a complex
sale, it’s still very hard to isolate thedifferent variables. We do our best,but we realize that tracking the ROIof an individual campaign is funda-mentally flawed because it doesn’ttake the interaction of other marketing vehicles into account.
Best PracticesOne of our best practices for achiev-ing a good return on investment ishaving clear goals and measuringpeople based on those goals. Eachquarter, we establish certain metrics
“While most senior executives in marketing would agree that campaignROI is critical, marketers tend in realityto be more ‘soft and fuzzy’ in theirmindset.”
• 20 years’ experience in strategy, marketing, and product management
• Previously VP of worldwide marketing and product management,Macrovision’s Software TechnologyGroup
Daniel GreenbergCEO, CMOPro Inc. (Former CMO, Tumbleweed Communications)
We have to determine whether we attracted acustomer with the e-mails we sent, with an adthey saw in a magazine, or with our salesrepresentative’s direct contact.
to hit. This keeps people focused onwhat really matters rather than get-ting caught up in the fun, creativeside of the job.
We are always educating theteam about the levers they haveunder their control. In direct mar-keting, these levers are typically themessage, the creative, the call toaction, and the offer. Recognizingthat we have these four differentlevers to play with inspires the teamto think creatively about optimizingone lever at a time. We then haveto figure out which ones are gettingbetter response rates. With that kindof framework, we can improve aswe roll out related campaigns overtime.
Fostering CreativityOne way that I instill creativity isby having off-site meetings with theteam. Each off-site is generallybased on a different theme, but cre-ativity is always an underlyingagenda. I’ll often bring in an out-side facilitator. Bringing people off-site to brainstorm topics helps freethe mind. I’ve been an avid studentof brainstorming for most of my
career, and I tend to bring the practice with me.
There are methodologies thatyou can deploy to bring out cre-ativity in people. It’s easy to getstuck going through the motions.Very few people tap into their cre-ative juices on a regular basis, yetcreativity is the force that unlocksthe needle-moving innovations inthe business.
Increasing ProductivityThrough Focus andSpecializationI instill productivity by tracking goalattainment on a quarterly basis.This keeps people focused on whatreally matters. Managers should besitting down with their directreports at least once per month, ifnot once per week, to track howthey’re doing against their goals.
I try to be smart about dividingand conquering. Anyone who is run-ning a marketing department needsto continuously think about wheresynergies exist in common recurringtasks. In small organizations, there’s one jack-of-all-trades doing
everything. As a company’s sales rev-enue grows, a marketer would bewise to scale its team and divideresponsibilities in accordance withcommon processes.
We’ve got people who areresponsible for the actual imple-mentation of campaigns. We havedifferent people who devise thestrategy behind campaigns as wellas the product positioning. Wehave yet another group that workson overall corporate messaging
Daniel GreenbergCEO, CMOPro Inc. (Former CMO, Tumbleweed Communications) (continued)
Look at the numbers. . .• Unique Web visitors• Mentions in the press• Advertising impressions• Aided and unaided awareness scores
Score the leads on the basis of. . .• Size of the company• Seniority of title• Level of engagement based on the call to action
Track the conversion rate.. . .• What percentage of leads turned into sales?• What percentage are in the pipeline?• What was the cost per lead?
Measuring the Effectiveness of a Marketing Campaign — Quantitatively
Instilling Motivation
My direct reports, who are at thedirector and VP level, receive finan-cial bonuses for hitting their goals.Every two weeks we have a globalmarketing meeting that brings theentire team together. Members of theteam present their work at a show-and-tell. Here people receive a lot ofpositive accolades and reinforcementfor doing great work.
During those same meetings, wealso present how we’re doing withregard to our dashboards. We lookat hard metrics so we can see theareas where we’re doing well andthose where we’re not doing well.
and positioning. All of the groupsdo, however, work together onrolling out campaigns, which leadsto a lot of scale and productivity.
Specific MeasurementsOver the past five years, I’veworked on refining a marketingdashboard. In order to quantita-tively measure effectiveness, welook at unique Web visitors, num-ber of mentions in the press, andadvertising impressions. On an
annual basis, we measure aided andunaided awareness.
For demand, we track totalleads. We score leads according tocertain criteria such as size of thecompany, seniority of title, and levelof engagement based on the call toaction. We give leads an A, B, or Cscore and track quality metrics overtime.
We track the conversion rate. Ofthe leads that marketing generates,we look at what percentage turninto sales and opportunities. We
track the pipeline, which is precur-sor to fail. This is the forecasted rev-enue in the heart of the sales force.
We track the actual closed salesthat were tied to leads and the pro-ductivity measure, which is cost-per-lead. We seek to increase thenumber of quality leads whilereducing their cost over time. ■
Ideas to Build Upon & Action Points I. Which Best Practices Help aMarketing Campaign Pay Off?With the advent of the Internet and other newtechnologies, marketers have more tools and leversthan ever to help their clients and/or companiesgenerate good buzz and sales leads. The art, ofcourse, lies in selecting the right mix for thecompany, its products/services, and market(s).While not all of these approaches will work inevery situation, some essential characteristics ofeffective marketing campaigns include:
• Learning a product or service’s history:How well has it done in the past?
• Gauging the target audience’s andemployees’ opinions of yourclient/company over different time periods
• Knowing your customers thoroughly —their behavior, interests, and preferredchannels through which they like to learnabout your product/service and company
• Analyzing how your competition isperceived
• Giving customers tangible incentives to dobusiness with your client/company, such asfree offers or educational content
• Focusing efforts on particular marketsegments that share similar demographicor “firmographic” (for companies)characteristics
• Aligning PR objectives to the overallbusiness goals of the organization
• Adopting integrated approaches tomessaging that use many channels, such asa sales force, e-mail, direct mail, Web site,media placements, special events, etc.
II. The Bottom LinePR used to play second fiddle to advertising, butno more. In the past decade, marketing has playedan ever-increasing role in business as manycompanies have reduced their advertising budgetsand attempted to gain a bigger “bang for thebuck” through marketing efforts. Every client orcompany has different ROMI goals, however,which will require establishing quantifiableobjectives at the start of the campaign. In planningcost-effective strategies for your client or company,important financial considerations are:
• What will “success” look like for thisparticular campaign?
• Which benchmarks will be most important(e.g., Web site traffic, employee retention,customer satisfaction, lead generation, etc.)?
• What’s the budget for the campaign? Howmuch revenue is expected to be generated?
• What’s an appropriate budget allocationfor the major sales and marketingcategories (e.g., advertising, onlineactivities, public relations)?
• What was spent the year before? Howsuccessful was that campaign?
• How will you pilot your campaign? Whatdo you expect these tests to reveal?
• What are the cost advantages to targetingfewer — but potentially more promising —customers?
III. Must-Have New MeasuringTools for Determining ROMITen years ago clients used to say, “50 percent ofmy marketing investment is paying off. If only Iknew which half.” Today, owing to new capabilitiesprovided by the Internet and other technologies,they expect 90 percent of their investment toperform — and for the marketer to be able toidentify and eliminate the 10 percent that is deadweight. To calculate such precise metrics, you willneed to leverage many recently-developedsophisticated measuring methods, including:
• Media clipping services (Burrells, Vocus,etc.)
• Online tracking services (Google News,etc.)
• Media audits (mentions in the press)
• Internal audits
• Unique Web visitors
• Market valuations
IV. The Golden Rules for Workingwith Leadership and Staff toMaximize Your MarketingInvestmentTo satisfy today’s demanding clients, marketingpeople must be both highly creative and intenselyanalytical. Moreover, to ensure an acceptableROMI for a campaign, they must also be adeptat keeping the lines of communication openbetween all stakeholders throughout the entireplanning and launching processes. To sustain thelevel of motivation necessary to accomplish thisbalancing act, the CMO should:
• Garner support from senior managementas well as the sales, operations, and financedepartments by sharing objectives andtimelines at the beginning of campaigns.
• Communicate campaign goals andexpectations in clearly demonstrable terms(e.g., target number of media impressions).
• Provide bonus programs that are tied tocampaign results.
• Divide responsibilities to establishsynergies in different task and talent areas(i.e., product positioning, corporatemessaging, etc.).
• Hold regular meetings where staffmembers can present work and receivepraise, and off-site retreats where they canbrainstorm ideas.
• Educate the rest of the company abouthow marketing can serve a strategicfunction.
• Create an environment where successes areviewed as bolstering the entireorganization, not just one component part(such as marketing at the expense of sales).
V. Essential Take-AwaysTracking return on specific marketing investmentscan be difficult because in some instances you willnever know if a sale resulted from an e-mail, anad, the company Web site, a newspaper article,a neighbor’s recommendation, or a salesperson’sdirect contact. However, the good news is thatthe success of many marketing investments cannow be quantified — if you utilize appropriatemethods that assess actual impact, such as:
• Assessing the appropriateness of the mediachannel where your mention appears toyour overall marketing goals
• Evaluating the content of your mediamentions to ensure that they accuratelyportray the message(s) the client/companyis trying to convey
• Calculating the value of your mediamentions on the basis of the costs forcomparable advertising space
• Learning a particular media’s impressionsof the client/company and its competitionthrough media audits
• Determining a media mention’s impact onphone calls, Web site hits, etc.
• Tracking how the client/company is doingagainst its competition, and how it ispositioned against its competition
• Conducting customer research and internalemployee opinion surveys
• Scoring leads according to specific criteriasuch as size of company, seniority of title, level of engagement, and conversionrate ■
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10 KEY QUESTIONS AND DISCUSSION POINTS
What current methods does your company use to track return on marketing investments? Are these methods standard for the industry? If not, why does your company use them? Have your company’s methods changed over time?
What is your target ROMI? How often have you accomplished it? What factors contributed to this success? What challenges do you regularly face in meeting your ROMI goals? Do you have differentROMIs based on the type of investment, i.e., online marketing versus traditional?
How does the rest of your company view the marketing function? To what extent are marketing initiativessupported throughout the rest of the organization? When working with other departments, what challenges do you face? From the perspective of other departments, what are the marketing’s priorities?
What are your department’s best practices for achieving a good return on investment? In what ways arethey similar to your industry’s best practices? In what ways are they different?
What role do your company’s senior managers play in establishing ROMI goals? What strategies doyou use to garner their support? Why are these effective? Have they changed over time?
How do you motivate your employees to support ROMI goals? What promotions/incentives do you offer to employees for meeting targets? How do you foster an environment of creativity and productivity? How do ROMI goals influence hiring practices?
In terms of yielding an outstanding ROMI, what are your top five marketing campaigns? Why did thesesucceed as well as they did? What did they accomplish (i.e., increased company visibility, grew marketshare, etc.)? What impact have they had on the company?
What marketing investments do you plan in the next 12 months? What do you hope they will accomplish?How much are they projected to cost? How will you sell these ideas to senior management? What preparations will your company and staff need to make? What is the expected return?
How is your current marketing budget spent? Is the budget size and allocation typical for companies ofcomparable size in your industry? Why or why not? Has this budget changed in recent years?
What challenges to achieving ROMI goals do you anticipate that you may encounter in the next 12 months? What is their cause? How do you plan to address them?
