Post on 29-Nov-2014
description
How to Align Marketing Technology with Business Strategy
MarTech Boston August 19, 2014 David M. Raab
Raab Associates www.raabguide.com
draab@raabassociates.com
Strategy = method to a goal
Strategy Implications Strategy Statement: Attract large numbers of high-paying customers by creating a highly innovative product that can be sold via ‘buzz’ marketing.
Financial Margin • High
Number of customers • Add customers
Revenue / customer • High
Customer Value Image • Exciting • Advanced
Relationship Product • Unique
Internal Operations
Marketing • Build ‘buzz’
Innovation • Simplified
interface
Production • Quick
delivery
Customer support
Admin
Learning
Information & systems Competencies • Outsourced
manufacturing, • Channel training, • Design, • Marketing
Organization Product-based
Successful Strategies
• Steve Jobs’ Apple: insanely great products
• Amazon: customer convenience
• UPS: efficiency and reliability
• Southwest Airlines: low cost
Unsuccessful Strategies
• Steve Cook’s Apple: multi-color phones?
• Steve Ballmer’s Microsoft: copy Apple?
• JCPenny: high fashion or low price or in-shops or ???
• Radio Shack: only source for stuff nobody wants
Good Strategy: It’s All About Fit
• Resources
• Competencies
• Market needs
• Competitors
• Environment
Strategy Implications Strategy Statement: Attract large numbers of high-paying customers by creating a highly innovative product that can be sold via ‘buzz’ marketing.
Financial Margin • High
Number of customers • Add customers
Revenue / customer • High
Customer Value Image • Exciting • Advanced
Relationship Product • Unique
Internal Operations
Marketing • Build ‘buzz’
Innovation • Simplified
interface
Production • Quick
delivery
Customer support
Admin
Learning
Information & systems Competencies • Outsourced
manufacturing, • Channel training, • Design, • Marketing
Organization Product-based
Case Study: Strategy to MarTech Connection
• Business: – New company, disruptive tech, clearly superior
• Business Strategy: – Grow quickly by adding customers via partner sales
• Marketing Strategy: – Now: support partners via joint field events – Future: build company-generated lead flow via media, Web site
• MarTech Strategy: – Build for fast growth, future needs – Now: support field via self-service promotions – Future: support media via analytics, Web site via MA integration
• MarTech Choices: – Now: best-in-class end-user email, forms, selections – Future: flexible MA database, data warehouse outside MA
Strategy to MarTech Framework
Business Strategy
Marketing Strategy
MarTech Strategy
MarTech Architecture
MarTech Components
• Focus: Product vs service vs cost • Financial:
Margin vs number of customers vs revenue per customer • Value Prop:
Image vs relationship vs product
• Channels • Spending • Intimacy •User skills • Target metrics
(CPA, LTV, ROI, growth, etc.)
• System scope • Channel
integration • Execution
automation • Program
sophistication • Flexibility • Scalability • Cost • Staffing
• Shared vs siloed • Suite vs. best
of breed • In-house vs
outsource •Owned vs
rented • External
integration (CRM, Web, etc.)
•Database • External data •Data quality • Identity
association • Analytics •Decision
engines • Execution
systems (email, Web, social, events) •Management
(content, planning, budget, etc.
Strategy to MarTech Example
Business Strategy
“Offer low prices profitably in online retail by running with low operating costs” • Focus: Cost • Financial: Modest margin, high number of customers • Value Prop: Relationship (trusted source of best prices for standard products)
Strategy to MarTech Example
Marketing Strategy
“Attract price-conscious customers by stressing low prices and making highly targeted offers; key metric is marketing ROI (=promotion efficiency)” • Channels: limit to major channels (easier to optimize) • Spending: tie closely to profitability but grow over time to gain scale • Intimacy: track customers closely to allow targeted offers •User skills: modest (standard skills needed; keep costs low) • Target metrics: ROI is most important
Strategy to MarTech Example
MarTech Strategy
“Keep costs low by running tightly integrated systems, highly automated systems with limited scope (i.e., optimize in only a few channels)” • System scope: manage all marketing interactions through single system • Channel integration: tightly integrate channel data; loosely integrate promotions • Execution automation: highly automated targeting to add revenue and reduce costs • Program sophistication: modest sophistication; only need targeted offers • Flexibility: accept limited flexibility in return for lower costs of optimized processes • Scalability: high to accommodate required volume and avoid replacement projects • Cost: as low as possible • Staffing: small, highly skilled staff to run automated systems and manage
outsourced resources
Strategy to MarTech Example
MarTech Architecture
• Shared vs siloed: share all possible functions to reduce costs • Suite vs. best of breed: use suite to reduce costs, improve integration • In-house vs outsource: outsource to reduce costs; accept limited flexibility •Owned vs rented: rent at start but ultimately want to own to reduce costs • External integration (CRM, Web, etc.): highly integrated to capture and consolidate
data and to present targeted offers during interactions
Strategy to MarTech Example
MarTech Components
•Database: standard database; limit unstructured data unless clearly cost-effective • External data: limited use to reduce costs •Data quality: basic capabilities required • Identity association: basic capabilities required; primarily tracking known customers • Analytics: highly automated offer targeting, media optimization •Decision engines: must insert business factors into decisionis (e.g. inventory levels) • Execution systems (email, Web, social, events): use suite features if possible •Management (content, planning, budget, etc.): use suite features; need tight cost
management but otherwise only basic capabilities
What’s for lunch?
Does anybody really do
this?
Why Strategy Matters