Wednesday, November 28, 2007

Top Ten Attributes of a World Class Tech Mktg. Org.

The archetype of the world class tech marketing organization, Top Ten characteristics:

1) The senior-most marketing leader is viewed as a being a business-person by the CEO or COO or equivalent.

2) The senior-most marketer is perceived by the other peer-level direct reports to have equal weight and reporting status in the politics and influence of overall management.

3) If it is primarily a B2B tech vendor, the senior-most marketer has an especially productive and collaborative relationship with the senior-most Sales exec.

4) The marketing organization has a good grasp of its "marketing business model"; that is, what are the ingrained programs, practices, etc. that represent the foundation to the company's marketing platform. There is an annual "rhythm" to this marketing business model so that there is a good sense, across the marketing team, of a solid operating pattern. In other words, the team does not feel as if the marketing strategy changes frequently and is the "flavor of the month".

5) In addition to the foundation of this marketing business model, there is also the room, the operating space, to try new marketing initiatives. These should be one or two (at the most) major initiatives that are tested and tried during the year, lead by the CMO.

6) There is a good balance to the art plus the science of marketing. The foundational elements of the marketing business model should be ingrained enough so that there is a steady and relevant stream of performance metrics that can be driven out of the activity. To the extent that the CMO is able to produce and manage towards these metrics for the core activities, he/she will be allowed more latitude for creating and testing new activities - which by definition will be hard to apply the science to at the beginning.


7) There is good attention to the marketing operations aspects. The marketing organization is right-sized; it is balanced appropriately for the resources and activities that are at corporate vs. elsewhere. There is good attention to budgets(marketing's managerial accounting process); a strong marketing performance measurement process; marketing's short-term and long-term technology needs; and there is enough awareness and circumspection about the marketing budget and the overall company income statement that the CMO, if requested, can with-stand a budget reduction while still being able to keep the core elements of the marketing business model in place and productive.

8) There is a strong marketing staff and constant attention to improving staff caliber and building skill sets.


9) The CMO and staff have a good grasp of the marketplace wants/needs; key industry trends that impact the work; and key competitors and trends. All this is indicative of good "outside-in" marketing and will help the marketing team to be perceived as business people that can credibly represent the voice of the customer within the organization. (for marketing, sales and product development/innovation)

10) The marketing function is perceived within the organization as a good place to work; a function where careers can be built; a function that has a high bar for job entry.

I could go on, but those are the top ten.

How long could it take? Depends on what you are starting with. If rock-bottom is the basis, it could take 2-3 years.

By Rich Vancil, VP Executive Advisory Group, IDC

Wednesday, November 14, 2007

Channel Marketing Investment - How much did we spend and why?

Do you know how much of your marketing investment is dedicated to your channels? Not just co-op and market development funds(MDF), but also the investment in other marketing activities that are intended to either directly or indirectly support the channels. This may include "ground cover" as some people would put it. If your answer is no, then you're not alone. Few companies have a more holistic understanding of their investment in the channels, let alone their return on that investment. In addition, most channel-centric companies are afraid to modify their investment in the channels since they don't quite know what will happen; taking a stance of "if it's not broken, don't fix it".

With cost pressures on marketing only increasing, this strategy will need to change, and quickly. The challenge is even greater for those companies just beginning a channel marketing program. . . trying to decide how much to invest in the channels and how to manage and track return of that investment.

Here are some key findings from recent IDC research:

-IT vendors must increase their investment in marketing to support an expansion in indirect sales. IDC has modeled the change in marketing budget ratio (MBR), or marketing investment as a percentage of revenue, based upon shifts in revenue from indirect sales. This shift will vary depending upon the size of the company, segment-specific variables, and business mix or other factors, but the trend is clear that support of indirect versus direct sales requires additional marketing investment. (feel free to contact me at mgerard@idc.com to receive a report which summarizes this relationship for software companies)
-In addition to the level of overall marketing investment, the marketing mix also changes as collaboration with reseller channels increases. For example, IDC research indicates that events and direct marketing program spend allocation as a function of total program spend decrease with increasing investment in the channels. The key take-away here should be that you need to review your marketing mix carefully as your channel strategy and investment shift.
- Initiate a channel marketing performance measurement program if you haven't done do already. This strategy should include development and tracking of operational metrics (e.g., channel marketing investment as a % of revenue, investment throughput) as well as execution-focused metrics (e.g., lead generation metrics). Collaborate with your marketing operations team to advance this agenda if you haven't done so already. (what's "marketing operations"?. . . . glad to send you a copy of my recent study in this area if you're interested mgerard@idc.com)

Also, check out a recent article in B-to-B for additional information on channel marketing.