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What the CEO Really Thinks of Marketing and 5 Things You Can Do About It<br />Dave Kellogg<br />www.kellblog.com<br />

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Intro and Disclaimers<br />Intro<br />Techie turned marketer<br />Product marketing  VP marketing  CEO<br />Ran marketing at BusinessObjects for 9 years during growth from $30M to $850M<br />CEO of MarkLogic from $0 to $80M run-rate<br />Disclaimer<br />B2B background and bias<br />During Q&A let’s see how we can apply these lessons to consumer-oriented businesses<br />

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Let’s Cut to the Chase<br />What does the CEO really think of marketing?<br />

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or more specifically<br />When most CEOs think marketing, they think this<br />

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John Wannamaker’s Famous Quote <br />“Half the money I spend on advertising is wasted; the trouble is I don't know which half.”<br />

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Scott McNealy At Sun’s Ten Year Anniversary Celebration<br />Thanks to engineering for building our fine products<br />Thanks to sales for selling our systems<br />Thanks to customer support for servicing our customers<br />Thanks to finance for accurately recording our profit and loss<br />Thanks to facilities for maintaining our fine buildings<br />Thanks to IT for running our internal systems<br />Thanks to marketing for … whatever it is they do.<br />

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Business Objects GM Quote<br />“Until I hired Charles, I must secretly admit that I never felt comfortable spending money on marketing.”<br />

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Why?<br />Most CEOs do not understand marketing<br />Few CEOs have worked in marketing<br />Most come up through product or sales<br />Marketing costs a lot of money<br />Marketing spending is usually variable / discretionary cost … and easy to cut in a pinch<br />Marketing delivers ambiguous returns<br />Marketing agencies like bravado and the implication of voodoo and black magic (“marketing guru”)<br />(We do it to ourselves)<br />

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Why?<br />“If I hire an incremental salesperson, I get $1.7M. If I hire an incremental marketer, I get <what>?”<br />I have a strong marketing background<br />I have been a CMO for over a decade<br />I believe in marketing<br />I consider myself a marketing person<br />I confess to having had this thought<br />

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The Even-Darker CEO Thought<br />The board wants 6 more points of operating margin<br />I wonder if I stopped marketing completely would anybody even notice?<br />

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What Can We Do About It?<br />Remember why marketing exists<br />Measure helpfulness<br />Be metrics driven<br />Be accountable<br />Do periodic ROI work<br />

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1. Why Does Marketing Exist?<br />If we had a three-person company, what would we have?<br />1 founder<br />1 developer<br />1 salesperson<br />“Code, sell, or get out of the way.”<br />

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Why Does Marketing Exist? <br />Why might we add marketing<br />Let’s not have every salesperson make his/her own slides<br />Let’s be consistent in what we tell people<br />Let’s generate leads for sales so they can focus on selling<br />Someone needs to build the website<br />Let’s capture that technical message in a white paper<br />Let’s get the word out so sales isn’t calling on cold prospects<br />…<br />Marketing exists to makes sales easier<br />

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Make Sales Easier <br />I first heard this as a product manager in 1987 from Chris Greendale (who went on to found CTG)<br />I embraced it and used it as a mantra that drove my marketing career from product manager to CMO of a $1B company<br />Its simplicity is disarming<br />It does not imply that marketing is tactical and not strategic<br />Designing products that sell more easily in is included<br />Strategic acquisitions (e.g., of competitors) are included<br />Use this as a North Star to orient your organization<br />

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2. You Can Measure Helpfulness<br />Periodic marketing internal satisfaction survey<br />What tools have you used and to what extent are they useful?<br />How is our marketing in an absolute sense?<br />How is our marketing compared to other companies you’ve worked at?<br />Please allocate 100 units of marketing resource to these categories of spend?<br />What do you think of the website?<br />What percent of your leads come from marketing?<br />If you could change one thing in marketing, what would it be?<br />Use the same research techniques on your internal customers as on your internal ones<br />

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The Ever-Popular People Quadrant<br />% would<br />want to <br />take on <br />salescall<br />Best-kept <br />secrets<br />Superstars<br />The pack<br />Soon to be <br />former<br />employees<br />% awareness<br />

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Get Respondee Demographics<br />Have long have you worked at the company?<br />How long have you worked in the industry?<br />Did you make your quota last year?<br />Enables slice-and-dice which can reveal very interesting patterns<br />

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The Helpfulness Key is Intelligent Debate<br />Any idiot can show up and say “what do you want” and then do it<br />A value-added marketer challenges sales during the conversation<br />A “tough love” conversation<br />I know you think you want that, but I think you don’t. Let me explain why.<br />You are my customer, and I am not a doormat<br />

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3. Be Metrics-Driven<br />Could be a two-hour speech in itself<br />Use systems like Salesforce for leads and opportunities and Eloqua or Marekto for incubation<br />Report back on these metrics (e.g., at ops reviews)<br />Do not gag your audience with data<br />Show them data; talk about insight and action<br />Our top 5 campaigns were … and we are going to … <br />Our bottom 5 were … and we are going to … as a result<br />

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Easy Areas for Metrics<br />Website<br />Advertising / adwords<br />Leads<br />PR<br />Salescalls<br />Support calls<br />Speeches<br />Analyst meetings<br />Trainings<br />…<br />

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Take an Intelligent Approach to Metrics<br />Don’t be a metrics slave<br />Never do stupid things in the name of driving a metric<br />Don’t incent your people blindly<br />Thinks of metrics as a cockpit / dashboard<br />Need to look at multiple panels to understand the situation<br />Ask good questions that close loops<br />Test your “knowledge”<br />Do our A-scored leads actually convert at a better rate than the Bs?<br />Hire a quant – if you’re not one, then get one<br />

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4. Be Accountable<br />One of the fundamental tensions between sales and marketing results from marketing’s perceived lack of accountability<br />Sales feels (and usually is) highly accountable<br />Marketing can be perceived as a country club<br />One way to make yourself more accountable is to publish goals and do quarterly assessment (e.g. , at ops review)<br />They will never see you as accountable as themselves, but they will appreciate the effort<br />And it’s a best-practice anyway if only for alignment<br />Wait a minute, you’re cancelling the XYZ! We love that!<br />

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5. Do Periodic ROI Work<br />Most B2B sales processes are complex and involve multiple touches to multiple individuals from an organization over the course of months and years<br />Most ROI studies are not believed by the people who read them<br />Either on a external or internal basis<br />(Aside: prefer ROI tools to ROI calculations for external use)<br />Ergo measuring ROI of B2B marketing is extremely difficult on a forward basis<br />Which programs lead to which sales?<br />

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Do Periodic ROI Work<br />I prefer to periodically run it on a backwards basis<br />Which sales were influenced by which programs?<br />Marketing-influenced pipeline<br />Helps the organization understand the difficulty of the problem<br />Do not count angels on pinheads<br />e.g., use surrogates like credit the last program or the first contact or the first program, etc.<br />

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Summary<br />Most CEOs don’t understand marketing<br />All CEOs worry that marketing money is wasted<br />Marketing money is usually variable and easy to cut<br />Marketing can proactively protect itself from the “I wonder if we stopped doing this would anyone care” question that the CEO will occasionally consider<br />Marketing can do this by<br />Remembering why it exists<br />Measuring helpfulness<br />Being metrics-driven<br />Being accountable<br />Periodically doing ROI work<br />