In marketing, quality always comes before quantity. Spending big on poor quality communications, inferior products or misaligned channels is simply a waste of money. High quality marketing creates marketing leverage: repeatable revenue with high marketing ROI. Unfortunately, you cannot buy marketing quality. Marketing quality comes from the creative minds of hard-working marketing teams. Marketing teams are the heart and soul of every marketing organization. In fact, most marketing departments spend more money on people than they do on programs. If you want to build sustainable revenue growth through marketing, then you must first build innovative, productive marketing teams.
This is the third post in a Markodojo marketing management blog series on marketing process management. The first two posts in the series focused on the marketing management process itself, highlighting the importance of marketing leverage in driving sustainable revenue growth. This third post examines the organizational challenges of scaling marketing as a business grows, and offers a foundation for building breakout marketing teams that drive growth with high marketing leverage.
The Conflicting Forces of Marketing Leverage
Increasing marketing leverage requires a balance of ongoing marketing innovation and high production efficiency. Efficiency without innovation results in flat-lined revenue as mature marketing programs tap out on growth. Innovation without efficiency results in poor marketing ROI and complete confusion as marketing managers jump on every new bandwagon. Sustainable revenue growth requires both innovation to optimize new marketing programs and increasing production efficiency as marketing programs mature. However, the skills, org structures, and processes that foster program innovation are often in direct opposition to those that increase production efficiency.
When designing the optimal marketing organization, senior marketing managers consider many dimensions: products, channels, skill sets, geographies, labor costs, and so forth all play a role. However, in most cases their importance is directly correlated to their respective impacts on program innovation and production efficiency. For example, a product marketer with poor design skills cannot produce a website alone, it’s just not efficient. A local field team will be more flexible in addressing local market needs than a remote corporate marketing team, it’s just more innovative. So before you default to the efficient approach and consolidate all your designers into a marketing communications function, be sure to examine the impact it will have on marketing innovation.
Marketing Management Process Models
Perhaps the biggest constraint on your marketing management process and team structure is the natural project size for any given marketing program. You simply cannot manage a major product launch the same way you manage your weekly blog calendar. By their very nature, bigger marketing projects require more marketing planning, take more time, entail higher risk, have larger marketing teams, and involve more people outside the marketing department. If we map program maturity against marketing project size, we get a clearer picture of the four fundamental marketing management process models.
The marketing management process tends to follow one of four basic process models,
depending on a marketing program’s maturity and natural marketing project size.
Functional Services
Marketing departments with functional groups based on skill set, such as product marketing, graphic design, online marketing, and so forth allow increased production efficiency within each functional group. They also make hiring and retaining staff much easier in larger marketing organizations. However, most marketing deliverables require the skills of multiple marketing functions, so there is an immediate need to create cross-functional processes and work teams. For this reason they are often organized as “functional services” where ad-hoc project teams form around a project sponsor, such as a product marketer or brand manager, and projects are executed in an assembly-line fashion.
Goal: Marketing staff productivity
Constraints: Skill specialization by function
Cost Drivers: Local labor market rates and misaligned functional priorities
Management Focus: Alignment, integration and output of cross-functional teams
The project sponsor is ultimately accountable for marketing mix innovation, marketing project management, and strategic marketing goals, such as revenue growth. However, such accountability can be easily lost given the project sponsor’s dependency on the various functions, as these isolated groups often lose sight of customer needs and broader marketing goals. As such, a functional services approach works best for more mature, stable marketing programs where innovation and flexibility are less important. Marketing management process improvement focuses more on increasing efficiency and quality through greater standardization, automation and integration across functions.
Each marketing management process model has its own natural project flow,
marketing team collaboration model, and marketing project management approach.
Event Management
Almost every marketing department must have some skill at event management, even if it is a single annual product launch, trade show or sales meeting. Some marketing teams are entirely consumed by event management. When events are infrequent and limited in scale, it is possible to fall back on the functional services approach and treat the event as a cross-functional marketing project. However, as events become bigger and more frequent, the greater the need for dedicated event management teams to plan, organize and manage each event.
Goals: Event impact and ROI
Constraints: Timeliness and availability of resources required for the event
Cost Drivers: Outsourcing and asset reusability across events to minimize waste
Management Focus: Accurate event planning and coordination
Event management requires tight control to ensure everything shows up in the right place at the right time and makes the highest possible impact. For this reason, a strong event manager is usually identified and given command and control authority over the event. The event manager oversees detailed planning for the event and tight coordination before during and after the event. Production efficiencies are increased by outsourcing services, reusing expensive assets and securing the contribution of people outside the marketing department and often outside the company.
Marketing programs come in a bewildering variety. The appropriate marketing process model is largely determined by each program’s natural marketing project size and the required balance of program innovation vs. production efficiency.
Autonomous Groups
You can’t scale a marketing program that is not repeatable. Nascent marketing programs require relentless creativity, experimentation and optimization to discover and codify best practices. As such, they are best managed by dedicated marketing teams with a laser-like focus on continuous improvement. Cross-functional teams are too slow, too easily distracted, and lack accountability. Online marketing teams experimenting with new technologies and field marketing teams adapting to local market conditions provide two good examples where program innovation clearly outweighs production efficiency.
Goals: Optimization of marketing program against KPIs
Constraints: Creativity in identifying opportunities for improvement
Cost Drivers: Adaptability and speed of marketing program improvements
Management Focus: Effective team collaboration and focus on marketing goals
Autonomous groups provide maximum accountability for a clear goal, such as revenue growth for a specific marketing channel. To ensure success, a workgroup must contain all the resources required to achieve its goals. Significant reliance on external resources can slow progress and limit creativity. Autonomous workgroups usually have team leader whose role is to foster creativity, facilitate team collaboration, and keep the team focused on the goal of rapid, incremental improvements to marketing programs.
Market Research
There are specific cases where it is very difficult to make improvements to the marketing mix incrementally, such as a major advertising campaign, a new product introduction, a global pricing change, and so forth. To minimize the risk of fully scaling an unproven marketing program, marketing managers conduct market research and tests that gather customer feedback on the impact of potential marketing mix improvements.
Goals: Insight into or validation of new programs, products or services
Constraints: Degree of certainty required and prior domain knowledge to build upon
Cost Drivers: Design completeness of the new program, product or service test scenarios
Management Focus: Capturing customer feedback and following research protocol
Some market research programs are standalone marketing projects, such as surveys and focus groups, while others transition smoothly into production marketing programs, such as beta products and market tests. The marketing research process and team structure is usually dictated by the design of the research program. For example, if a market test must be deployed in three locations, then marketing management teams must be dispatched to each location. If the goal is to solicit feedback on a new product prior to general release, then marketing managers might conscript additional team members from product development and customer support to round out the research team.
Modern Marketing Process Management Methodologies
The rise of the Internet has led to rapid innovation in online modern marketing tools and techniques. When compared to traditional media channels like television, radio and print, the Internet is extremely dynamic and fast. Tweets, posts, emails, pictures, videos and products fly past at light speed. Moreover the Internet channel structure itself is very dynamic, having quickly evolved from Web portals to search to social to mobile. The dynamism and speed of Internet marketing has stressed traditional marketing management processes to their limits.
Modern marketing management techniques, such as agile marketing and growth hacking, relieve the stress of rapid change by making the marketing management process more adaptable. The magic behind these modern methods becomes obvious in the context of our four marketing management process models. They methodically reduce marketing project size to increase flexibility while accelerating innovation with autonomous teams.
By encouraging incremental work and gravitating toward autonomous teams, modern marketing management process methodologies aim to increase competitive advantage in fast moving markets by accelerating adaptation, while reducing the risk of failure.
Agile Marketing
If you look up the word agility in the dictionary, it says things like “nimbleness”, “the ability to move quickly”, and “the quality of being resourceful and adaptable.” In the context of marketing management, marketing agility is the speed at which you can adjust the marketing mix to deliver greater customer value and make more money. Agile marketing increases marketing agility through the practice of the five agile marketing disciplines:
Measure value through the eyes of the customer
Minimize waste by reducing uncertainty
Maximize flexibility by working incrementally
Foster alignment and collaboration through transparency
Improve iteratively and continuously
It is principal number three that has the greatest impact on the marketing management process and the structure of agile marketing teams: working incrementally. Big things move slower than small things. It’s simple physics. When change is the norm, big is bad. Small marketing projects allow you to win earlier, fail faster and respond quicker to time-sensitive marketing opportunities. The third agile marketing discipline requires you to master the practice of breaking big projects up into small projects, such that each small project delivers incremental customer value.
The agile marketing principle of incremental work is based on the recognition that production efficiency and marketing flexibility are not true enemies. The conflict arises when you focus too much on the efficiency of your work and not enough on the value of your work. When stuff happens, small marketing projects can be quickly finished to deliver immediate incremental value. Big marketing projects create waste and deliver no value when they are constantly interrupted and delayed. Flexibility depends on shrinking the amount of time it takes to get things done. Production efficiency depends on getting things done fast. Smaller, incremental marketing projects maximize both in a fast-paced environment.
Growth Hacking
Growth hacking is an emerging best practice for Internet startup marketing, however, its marketing process management lessons are much broader. Most Internet startups have three things in common:
No customers
Online prospects
No marketing budget
Your marketing programs can’t be too big, because you don’t have money, and you don’t know what will work except that it should probably be online. From our earlier discussion, you should quickly realize that this puts your marketing management process firmly in the lower left-hand quadrant. You want small marketing projects, lots of experimentation, and incremental growth—fast.
In an Internet startup, you are unlikely to have the budget for more than one or two people to tackle this problem. Enter the growth hacker. Most growth hacker descriptions go something like this:
Laser-focused on the goal of growth
Very creative marketing chops
Analytics junkie
Internet savvy, possibly to the point of being a coder
The growth hacker is a team of one that has all of the necessary skills to deliver online revenue growth. Which naturally begs the question: “How do I scale growth hacking?” The solution cannot simply be to hire more growth hackers, because the skill set is so specific that you should count yourself lucky to find one or two candidates that fit the bill, let alone ten. And, as soon as you have two growth hackers, their work needs to be coordinated.
You can scale growth hacking by deploying autonomous growth hacking teams with the goals, accountability and skills required to get the job done, for example a product marketer, graphic designer and programmer. Moreover, the concept of growth hacking is not limited to Internet startups. You could just as well deploy a growth hacking team to a local International market where the language, culture and technology demand dedicated marketing innovation. Or, to a new product introduction where the product capabilities and marketing communications must adapt rapidly to find product-market fit.