Watch that Org Chart in 2010

Twenty percent of tech vendors $1b or greater in revenue are now reporting that they have experienced some form of organizational "mash-up" between marketing and sales over the last 12 months. This is the C-level effort to adddress the long-standing mis-alignments and costly points-of-friction between sales and marketing.

Lots of thoughts on this...but the most important is a "heads-up" to expect more organizational pressure and change in 2010. IDC forecasts marketing expenses (investment) to rise by 3.5% this year. We expect sales expenses (investment) to rise by 4.7%. Finally, we expect average revenue to to rise by 3.2 %. So, the math is not hard: operating margins will be under continued pressure. My sense is that the C-Level will respond with more brute force re-drawing of organization charts.

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Social Media is Not Marketing...Yet

I have just returned from the Bay Area where last week I moderated a panel of senior marketers on the topic of Social Media within the complex B2B marketing mix.

The more I think through the potential for this area, the more excited I become about the contributions that Social Media will eventually make to marketing.

What is most promising is that "Social” will help to transform marketing communications into what it should be: a two-way interaction between buyer and seller. Presently, much of our marketing communications is just the opposite: a one-way push of the vendor’s voice.

But Social Media is not Marketing…Yet. Mostly, it’s a jumbled mass of dialogue with a lot of static to sort through.

Social Media will become marketing when two things happen. First it needs to contribute to the "inbound" side of marketing. Web 2.0 conversations about your company’s product and services need to be mined and gleaned so that they become valuable components of your product management decisions. The litmus test here is that your product managers start to depend on those contributions.

The second thing that needs to happen is on the "Outbound" side of marketing. The litmus test here is that Social Media needs to become a primary preference for how buyers inform their decisions. IDC research shows that buyers almost always prefer to receive information from independent third parties and from their peers. So, Social Media should really shine in this application.

There is important work ahead to make it this happen. It’s all about how to operationalize your marketing organization to reap the benefits of Social Media. "Operationalize” doesn’t make it through your spell-checker… but it is on the lips of the best marketers in tech, today. Only with operational depth will Social earn its way into the marketing mix. In our latest survey of CMO’s less than one-half said that they were making "significant" progress on this task - and that’s from an audience who tend to self-rank pretty high.

Here are three operational Best Practices that I see marketing leaders taking, right now. These leaders, by the way, are moving quickly on these. My sense is that they know that these basic operational tasks need to be completed well before the inbound and outbound marketing benefits can be realized.

1. Centralize. If you have followed the IDC CMO area research, you know that we are not great fans of heavy-handed corporate marketing. But in this case we are pressing hard for this. The issue is that (Congratulations, by the way) everyone in your company is now in marketing! Well-meaning engineers are merrily blogging about a new technical advance. Your sales reps are tweeting about a local seminar that they are setting up. The problem is that we are creating the perfect environment for a major breach of data. A privacy issue will be violated; an important confidentiality will be disclosed. When this happens, the blame I think is going to wind its way back to the marketing department, regardless of marketing’s role in the breach. So, corporate marketing needs to have the basics of governance and policy in place.

The second opportunity for centralization is for shared service creation. One of my clients has five major development groups and the lead developer in each group took a separate initiative to construct a community site for the development community and their most engaged customers. Couldn’t the deployment of a master community site with five sub-divisions have saved money? Yes. And wouldn’t it be easier to then deploy a single mining tool across those sub-divisions? Yes.


2. Train. I don’t think that there is a lot of good external "courseware" for how to conduct Social Media Marketing. But wait! Remember that everyone in your company is now in marketing?? I would bet that for every 100 people who are involved in Social conversations, that you have two or three real sharp-shooters. Find those two or three, and have them train the rest.


3. Measure. Poor metrics can give good marketing activities a bad name. One of the basic faults in metrics development is measuring activities and not results. Measuring the number of Tweets or enumerating the cast of your Followers are stark examples of these errors. Measure how many buying decisions you influenced. Measure how many customer service issues you identified and passed on to the right area for resolution. It seems basic but I am surprised at how many marketers still measure just the volume, the activities. Why? Because it’s easy. You have to be willing and able to do the harder work.


"Operationalize" for Social Media. An important initiative for 2010.

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The IDC Marketing Operations Holiday Gift List

This month I was delighted to join the Advisory Board of MOCCA: The Marketing Operations Cross-Company Alliance. In this new role I am looking forward to working with a number of current IDC CMO Advisory clients and also many new colleagues as we help to expand the professional capabilities of the important Marketing Operations (MO) role.

At the initial Advisory Board meeting, the basic theme of the discussion centered around the complexity and expansion of the MO role. “Our typical member needs so much and the role is evolving so quickly” …we concurred… “That we have a world of opportunity to serve and support them. And so, where to start?”

And so, where do we start, to start 2010? First, let’s finish 2009 end enjoy the Holidays.

It has been a difficult 2009 for all of us in marketing. But especially so for our MO staff! Marketing’s selfless few who have ignored the hunger-pangs of process improvement so that demand generation might eat ! Our tireless servants-of-spreadsheets who have had to bear the ceaseless administration of budget reviews, even as their own chart of accounts were flayed to the bone by corporate finance!

Who more deserving than your favorite MO professional to be remembered at this important time of year?

To make things easier for all, I have prepared a simplified Marketing Operations Holiday Gift List, so that you may save time in shopping for your favorite MO professional. With this list completed, you may rest well over the holiday break, secure with IDC’s assurance that your MO staff will achieve professional success in 2010:


1) Her choice of a Shiny New MPM dashboard; an MRM system; or a Sales Enablement portal. Okay: you could argue that this is an extravagant gift to have to purchase during a recession. But IDC’s most recent survey of marketing automation investment trends and our on-going conversations with MO professionals would indicate that evaluation and investment in marketing automation is at its fastest pace of the past seven years. So, why should your MO staff not receive what all the others are?


2) A Brand-New Colleague (to help out with the increasing work-load).

Here is my observation: a few years ago, helpful or break-through contributions from the newly-hired MO staffer was viewed as an un-expected pleasant surprise for the CMO. Today, that same CMO sees the MO role as legitimate and necessary and established. As such, the CMO is now ratcheting-up the expectations that they have of MO-area output: better controls and budgets; crisper processes; and greater alignment with other functions. However, the percentage of total marketing staff in place to satisfy those rising expectations has leveled off in the range of 4-5%, over the past two years.

So: what to look for in our new colleague? Impeccable grooming, but willing to roll up sleeves and get hands dirty. The ability to data-cleanse an aging lead file with the best of them. Full of energy and capability. A respected background in sales and marketing. A holder of political equity, and a willingness to expend it .

3) How about giving your most important MO professional the gift of Six Months of Peace, Love and Understanding with Sales? Can’t seem to find that on Amazon or E-bay? How about a copy of the bestselling book “Difficult Conversations”?

4) A reasonable Marketing Budget Increase for 2010. This is also a difficult gift to ask for during a recession. But IDC is known for being conservative and objective in its outlook and forecasts, yes? And so our current sentiment that the average tech vendor should receive an increase of 3% to marketing budgets in 2010 should not break the bank. So, make sure that your marketing department gets its fair share (plus twenty percent).

5) An all expense paid, ten-day trip to Hawaii. This has absolutely, positively nothing to do with Marketing Operations but it sure sounds nice, doesn’t it?


From the IDC Executive Advisory Group – Happy Holidays and prosperous New Year!

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IDC's 7th Annual Tech Mktg. Benchmarks Study

Key CMO Priorities and Investment Strategies for 2010

2009 will be a year that all marketers would probably like to forget. As a community, tech marketers have had to withstand significant recession-led budget cuts, staff reductions, and organizational disruption. For the full year 2009, the average large ($1b+) IT vendor will have reduced overall marketing budgets by 8.3%. The average vendor has reduced the number of marketing staff by about 10% in 2009. In total, IDC estimates that over 6,000 marketing jobs will be lost in the IT vendor community (worldwide) during 2009.

It may seem simplistic to say that "times of great change bring times of great opportunity". But IDC's surveys, interviews, and personal interactions with the best and brightest of tech marketers, validate that many CMO's and marketing leaders are indeed creating opportunity out of the 2009 chaos in preparation for 2010. So how are the best-in-class marketing organizations reacting? First of all, they have spent the past couple of years improving their organizational structure, working on key marketing processes (e.g., strategy planning, performance measurement) and streamlining their demand generation activities in collaboration with sales - putting them in a better position than other companies. This year, they are finding new budget monies via re-direction and re-deployment of existing budgets. They are moving monies from product-line marketing to streamlined thematic campaigns. They are creating more shared services that remove redundancy in complex marketing organizations. And they are leading an evolution of sales enablement to reduce expenses while boosting marketing and sales productivity.

CMOs should follow these steps as essential guidance during 2009-2010 planning and budgeting:

• CMO's and senior marketers need to withstand potential organization changes by making sure that they maintain reporting control and/or budget control over the entire marketing organization: the full scope of corporate marketing, product marketing, and field marketing.


• Even as the recovery "emerges"...be prepared for further organizational changes in the marketing department. The most prevalent trend is change that will help in the unification of marketing and sales. There is opportunity in this change: marketer's can introduce and lead significant Sales Enablement practices, for example. have in place for the up-turn to come? Are you prepared to answer this question when your boss asks you?


• Be prepared for an economic recovery. What marketing plans and initiatives do you have in place for the up-turn to come? Are you prepared to answer this question when the CEO or CFO asks you?


• For marketing staff positions that need to be filled or that may be the first candidates to fill when hiring freezes are lifted: there is some great marketing talent "on the street" right now and the best ones will not be there forever.


• Every new marketing initiative that you propose should be "bundled" within a cost-savings idea. Think about re-deploying and re-directing existing budgets, versus asking for new-new monies. The IDC CMO Advisory area has many case studies for budget re-directs and re-deploys. Clients should refer to IDC Best Practice Studies on Sales Enablement, Shared Services, and Campaign Management.


• Expand your operational proficiency for Digital Marketing. This would include a look at the sophistication of processes, infrastructure, and people. (e.g., refer to IDC's recent telebriefing on key success factors for BtoB social media strategies)

For additional information and guidance, join the IDC Executive Telebriefing today(10-1-09), "Tech Marketing 2009-2010: Move from Budget Bust... to Budget Build!" at 12:00pm EDT.

Register here

IDC will be publishing the full results of its 7th annual Tech Marketing Benchmarks study in the next couple of weeks for clients of IDC's CMO Advisory Service (i.e., Marketing Investment Planner 2010: Benchmarks, Key Performance Indicators and CMO Priorities)

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The Product Marketing Reporting Structure Dilemma

Where should product marketing report into within a technology organization? Marketing? Business Units? Product Management? The CEO? IDC's 2008 Tech Marketing Benchmarks study indicated that product marketing reports directly into marketing at approximately 45% of technology companies. This is by no means a clear trend to be replicated by every company. In fact, based upon years of research at IDC in this area as well as my own experience in the product marketing function, I continue to believe that the correct answer for product marketing's reporting structure is. . . . it depends. Yes, this may seem like a cop-out initially, but there really is some support for my opinion here.

The first question to consider is what is your definition of product marketing? IDC's official definition is as follows:

• Marketing professionals accountable for developing and executing the strategy to increase market share for specific products. Activities include market sizing and opportunity assessment, proposing future product development, developing market requirements documents (MRDs), crafting key product messages, conducting competitive analyses, and determining pricing, packaging and program offerings. (this category does not include product management, industry marketing or solution marketing) - refer to IDC's Sales and Marketing Taxonomy

Regardless of your reporting structure, your first step needs to be the definition of this role within the organization including how this role will interact with other parts of the company. (i.e., roles, responsibilities, performance measurement strategy) Many companies have overlapping responsibilities between product management and product marketing depending upon the business unit or individuals' skill-sets. Combining these two roles is also quite common.

So back to the reporting structure dilemma. Not only have I seen product marketing report into different parts of an organization, but I've seen it oscillate within the same company between marketing and the business units every couple of years. Regardless of what has happened historically in your company, product marketing should report into the part of the organization where the greatest misalignment exists today as well as where the greatest opportunities for improvement exist. (assuming these areas of misalignment cannot be fixed more easily from a process or tactics perspective)

For example, Citrix, a company recently cited in the Leadership Quadrant of IDC's 2009 Marketing Performance Matrix, shifted product marketing's reporting structure from the CMO (Wes Wasson) to the business units in early 2009. Wes described it as follows: "we occasionally shift the hard line reporting of field and product groups, depending upon where we most need to optimize". Another factor to consider is who owns the budget. Wes and his team decided to keep the budget within his control. The result is a strong sense of balance between control of staff and related processes (by the business units) and control of the budget (by the CMO/marketing).

What is your product marketing reporting structure and who owns your product marketing budget? Please share your thoughts below or feel free to contact me directly at mgerard@idc.com.

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IDC's Sales Enablement Framework

Sales enablement continues to be an area of opportunity for marketers to improve their credibility in the organization and their impact on the bottom line. IDC defines Sales enablement (SE) as: "The delivery of the right information to the right person at the right time in the right format and in the right place. . . to assist in moving a specific sales opportunity forward."

I'd like to invite Rich Vancil, VP of IDC's Executive Advisory Group, to share with you the sales enablement framework that our team (Rich Vancil, Lee Levitt, Seth Fishbein and me) has developed:

"Thanks Michael.

Sales people are knowledge workers and their preparation time is all about building their knowledge so that they can have the most effective interactions with their customers. We like to refer to these interactions as 'conversations'. A sales-person's conversations can be actual or virtual; written or oral; one-way or interactive; one-dimensional or multi-media. IDC's definition of SE centers on making these sales conversations more intelligent and engaging.

For early-stage management initiatives and emerging job roles, frameworks are helpful. Here is the IDC Sales Enablement Framework:

Starting on the left side of this Framework: IDC suggests that managers think about SE as starting in the marketing area (including Marketing Operations); and then moving to the Sales Operations area; and then into the actual selling functions.

Within the sphere of marketing activities, IDC research has found that over 40% of all marketing assets are not in use today, with some sales organizations reporting that as much as 90% of the assets created by their marketing peers are never used by sales teams. This includes assets that have been developed for sales, channels, prospects, and current customers. The top reason that assets are not used or that they are under-used, is that end-users are unable to access or locate these assets. Based upon anecdotal feedback from recent survey participants, the key root causes include: "too much material," old content and assets, and poor processes and technologies. The lack of relevance of content and assets is also cited as a reason for lack of asset utilization.

Sales enablement - from marketing's perspective - is more than simply using a content management system to get collateral and PowerPoint presentations to sales. It is the complete life-cycle management of content and marketing assets, including: content development; leveraging that content across the organization in a one-to-many fashion; collaboration with Sales Operations and the selling entities for the subsequent distribution and delivery of that content to sales (internal and external sales/partners); and the feedback loop from sales as part of continuous improvement.

Moving to the center of the Framework: this is Sales Operations' involvement in SE. An effective sales operations team should be ensuring that process excellence for SE is institutionalized for the entire selling organization. Sales Operations should seek SE best practices from all selling entities and share those practices company-wide. The sales operations team should take the lead on defining goals and objectives for SE; create and manage the processes and systems to meet those goals; provide overall execution over-sight and process governance; and then provide the measurement systems and reporting to track how SE progress is being achieved. As mentioned earlier, a key success factor for sales enablement is for strong collaboration between sales operations and marketing.

The final part of the SE Framework (right side) is the consumption and deployment of the content assets by Sales. The sellers should receive the benefits of the process and infrastructure groundwork that been built by marketing and sales operations. The first part of this is probably the most critical process-area of the entire Framework: How easy is it for the sales person to find the right content (in the right format), at the time that they need it, to help with a given sales conversation? The answer to this is one of the key levers in the Sales Productivity equation. More time in searching and seeking means less time in actual selling. As part of the reporting and metrics that Sales Operations is tracking to understand SE improvement, monitoring of this "searching" time should be an active metric - to reduce!

Effective SE also means that the content that Sales now has in hand, exists in the format or media that is appropriate for the conversation they wish to have. Does a PowerPoint presentation have all the content that the sales-person seeks, but the task of converting that into a Word proposal falls on the shoulders of the sales rep? Again, the definition of SE excellence has to include: "right time, right place, and right format".

Finally, the last step in this Framework is the sharing of SE best practices among the peer sales-people. This is perhaps the key litmus test of SE success. Sales people are smart and resourceful and seek expediency. If the marketing and sales operations elements of this Framework have been successfully deployed, the sales people will likely grasp and exploit it very quickly. Usage will become "viral" as SE best practices become quickly shared across the ranks."

Thanks Rich. Please feel free to email Rich directly at rvancil@idc.com or provide your comments below.

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Social Media Guidelines

I've posted a couple of blogs recently about the rise of the social media function and how BtoB companies can best leverage social media. A common theme has been the need for marketing to provide guidance, guidelines and infrastructure without stifling the power of this new channel to reach customers, prospects and influencers. To help with your journey, I've included below a list of social media guidelines that several companies have published:

• Adobe Acrobat Users: http://www.acrobatusers.com/blog_guidelines


• Cisco: http://blogs.cisco.com/news/comments/ciscos_internet_postings_policy/


• Dell: http://www.dell.com/content/topics/global.aspx/policy/en/policy?c=us&1=en&s+corp&~section=019


• Mayo Clinic: http://sharing.mayoclinic.org/guidelines/for-mayo-clinic-employees/


• BT: http://richarddennison.files.wordpress.com/2009/04/bt-social-media-guidelines-mar09.pdf


• eBay: http://ebayinkblog.com/2009/03/06/new-social-media-guidelines-for-reporting-company-information/


• HP: http://www.hp.com/hpinfo/blogs/codeofconduct.html


• IBM: http://www.ibm.com/blogs/zz/en/guidelines.html


• Intel: http://www.intel.com/sites/sitewide/en_US/social-media.htm


• SAP: http://www.sapweb20.com/blog/2009/07/sap-social-media-guidelines-2009/#
  
• Sun: http://www.sun.com/communities/guidelines.jsp

Have any others to share?. . . Please comment below.

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