Improve Marketing Effectiveness in a Digital World: Kevin Tigges, Microsoft
Marketing expenses are typically the second highest budget line item for consumer goods (CG) companies, and chief marketing officers (CMOs) are feeling the heat. They've long been pressured to justify every dollar spent, but in today's economy the old adage of "if you can't measure it, you can't manage it" has taken on a whole new urgency. Fortunately, game-changing technologies and digital marketing tactics are enabling CG companies to get a lot closer to top customers. Kevin Tigges, U.S. consumer goods industry solutions director for Microsoft (www.microsoft.com), shares his views on marketing trends, strategies and emerging technologies for 2010 and beyond. What marketing trends are you seeing in the CG industry?
Tigges: CMOs are focusing larger portions of their budgets on digital marketing, mobile promotions, integrated analytics and new forms of promotions in order to create a two-way conversation with shoppers and consumers. In fact, the digitally connected lifestyle created a dynamic environment in which companies can listen to customers' wants and needs. Savvy marketers are then using what they learn to capitalize on these opportunities with new, innovative products and promotions. Companies empowered to then deliver a custom offer or marketing message to their customers will achieve even greater results.
What challenges do CG companies face in adopting these new tactics?
Tigges: The main challenge they face is getting their arms around how to support it. Consumerization is definitely challenging traditional marketing models. CG companies are striving to understand how to adjust their existing business and marketing approaches in order to adapt to all the new technology-driven opportunities for reaching shoppers and customers. For the most part, marketing strategies and processes have not caught up with this consumer shift to a digital life- and work-style. The lines are blurring -- buying and selling occur in many places, as do searching and online social interaction. This digitization of people's worlds creates new pressures on existing models while at the same time creating new opportunities to reach people in more ways.
How can CMOs mitigate risks and improve marketing effectiveness?
Tigges: As marketing becomes more complex, it creates more opportunities and risks. In order to build a responsive, measurable marketing campaign, CG companies must embrace rich, intelligent tools that deliver real-time insight and support optimized actions. Dashboards and social media monitoring tools, for example, can promote marketing accountability and provide leaders with a complete picture of all marketing activities. These and other new technologies are enabling CMOs to be more accountable and effective at driving targeted demand and margins.
Tigges: To bring together a consolidated view of marketing spend versus impact, CMOs are increasingly relying on business intelligence tools to measure and optimize their most strategic metrics. They can use these technologies to track key performance factors such as return on investment, response rates, and cost per response in real-time; integrate data from multiple sources and format the information so it's easy to read and access. CMOs and other decision makers are using well-designed dashboards and other intelligence tools to optimize on the fly and across platforms. These dashboards can also send alerts, for example, when a promotion goes below a certain target or some other action needs to be executed.
Another emerging beta technology, which Microsoft has codenamed "LookingGlass," will impact how companies understand, engage and respond to the exponential growth of online chatter and sentiment about their brands. LookingGlass is a proof-of-concept business tool that harnesses the power of the Microsoft software platform to make social media data actionable. The technology looks holistically across the spectrum of social media content -- blogs, images, micro blogs, videos, web pages, and wikis activity streams -- and provides capabilities for listening, participating and analyzing social media. CG companies can then overlay sales and support data and other key business information to take targeted actions and enhance the ROI of participating in social media.
Microsoft is currently in the process of identifying pilot customers and looks forward to a broader launch in 2011.
How can CG companies improve effectiveness and efficiency within their organization?
Tigges: CG companies need to consider their marketing professionals and ensure they are providing them with the best tools to connect, collaborate and perform. With 75 to 80 million millennials in or entering the workforce, CMOs need to move beyond traditional bar charts and spreadsheets, and take advantage of new methods to quickly recognize trends such as data visualization techniques. In addition to improving productivity for the 20-something marketers on their team, these technologies are well-received by marketing professionals of all ages who are challenged with having to quickly identify actionable trends and respond to what's going on in key parts of their business in order to increase revenue and reduce expenses.
CMOs also must invest in technologies that help them to break down the silos that exist across brands, product lines and marketing functions. These silos foster miscommunication, elongate or delay processes and prevent economies of scale -- all of which can lead to missed opportunities, increased expenses and reduced marketing effectiveness.
By building a market-responsive enterprise framework, CMOs can utilize a "closed loop" management process to help maximize revenue and margin opportunities. This framework should enable a unified business strategy, processes and technologies in order to effectively align resources, execute customer-centric strategies and improve marketing performance. It should utilize technology to enable -- and, where possible, automate -- the cohesive execution of marketing's four Ps (product, price, place and promotion) across every customer touch point. CG companies are finding that an advanced Marketing Resources Management (MRM) system can be very effective in optimizing their overall marketing efforts required for effective campaign management.