It’s no secret that marketing leaders and their organizations are under increasing pressure to demonstrate their value to their businesses, especially in today’s tough economic environment; the effectiveness of marketing efforts can prove the key differentiator in highly competitive markets.

So, what sets successful marketing organizations apart from their less successful peers?  To learn more, join us for our webinar The Marketing Performance Advantage on February 25 where we will share best practices in measuring and managing Marketing Performance that we uncovered from a study among over 400 CFO, CEO and marketing leaders.

The objective of Marketing Performance Measurement and Management is:

To build the marketing organization’s capabilities to measure, learn from, and improve upon marketing strategies and tactics over time — with the goal of ultimately delivering improved business results.

By studying the responses of organizations that are experiencing a positive impact to their business from their Marketing Performance practices, we were able to identify five key best practices.

To learn more, join us for our webinar The Marketing Performance Advantage on February 25 where we will share best practices that we uncovered from a study among over 400 CFO, CEO and marketing employees of companies with 100+ employees interested in measuring the performance of their marketing initiatives.

CMO tenure is a common topic in our world of strategic marketing consulting and we recently formulated a few thoughts around why we believe this phenomenon exists.

Based on our experiences and perspectives we believe that marketing leaders often focus their energies and expertise on winning in the marketplace and fail to recognize the critical linkage between a strong internal foundation and the ability to execute effectively externally.

To help bring this to life, a colleague used the analogy of being tasked to round up marbles in the center of a room with an uneven floor…an unending, maddening task that will lead to nowhere fast.

In an effort to help marketing leaders diagnose the strength of their foundation and ultimately improve their tenure we propose four areas for marketing leaders to evaluate:

1. strategic alignment,
2. performance measures,
3. management buy-in,
4. and asset leverage.

For more information on these areas and our thinking on the topic please read our article  How Solid is Your Foundation?: Addressing CMO Tenure.

According to a recent Wall Street Journal article Starbucks is revamping its brewing process to bring the aroma of fresh ground coffee back into the shop. This return to their roots is happening in the name of injecting “romance and theatre” back into the Starbucks experience to win customers over from chains now offering a cheaper cup of Joe. I’m not sure regularly rotated brewing cycles are enough to convince recession-weary Americans to pay an extra buck for romance, but I applaud the move anyway. It appears as though it’s being done for the right reason – to reinforce the sensory elements that in part drew customers to Starbucks in the first place.

Can the smell of fresh ground coffee bring Customers back to Starbucks?

When I read the article I couldn’t help but wonder what led Starbucks to make the change. Was it customer research? Howard Schultz intuition? Or part of a larger undertaking to turn profits around? It struck me that this effort at its core is about marketing – focusing on your customers and delivering the Starbucks brand experience. But the matter-of-fact details in the article brought the nuts and bolts of this goal to life, describing the 24, 12, or 8 minute alarm-controlled brewing cycles that will be behind that fresh ground coffee smell.

While these details certain ruin some of the magic Starbucks is gunning for, they also caught my attention. As a marketer, the interesting point in all of this is being able to map how a simple change to the customer experience can require the cooperation of so many parts of the organization. It is this complexity that makes the art of delivering a great customer experience such a challenge, and yet, without it the brand promise is never fully delivered. Customer experience is a favorite topic of ours at CMG because it’s so critical to building loyalty, reinforcing your brand and ultimately driving sales. But customer experience can also be one of the thorniest areas we help clients with.

To pull off a change like this Starbucks likely needed collaboration from marketing, sales and retail, and countless other teams to revamp process, create new training, make changes to product and install the equipment for these new brew alarms, all in the name of the Starbucks experience. While this one switch is probably not a silver bullet, I’m impressed to see Starbucks doing the heavy lifting to reclaim their differentiation.

We were intrigued recently with a LinkedIn poll to members of the group, Chief Marketing Officer, requesting members’ one sentence definition of ‘what is marketing?’

We were even more intrigued by the range of answers from CMO’s, marketing VP’s and marketing leaders.

Before we jump into the responses and our thinking we thought it would be worth sharing what the marketing thought leaders from academia say:

• Marketing is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.  - Philip Kotler
• Marketing is the whole business seen from the point of view of the final result, that is, from the customer’s point of view. Concern and responsibility for marketing must therefore permeate all areas of the enterprise.  - Peter Drucker
• Marketing is a tightly integrated effort to discover, create, arouse, and satisfy customer needs.  - Ted Levitt

While reading through the posted answers we notice two themes that were present in each answer:

1. The first theme was associated with what marketing’s purpose is, which primarily fell into two camps; either internally focused (i.e. driving sales and profitability) or externally & internally focused (i.e. satisfying the customer that in turn delivers business results).

2. The second theme was associated with the practices of marketing, (i.e. what does marketing do) and with this respect we found answers that ranged from siloed focus of only including communication to what we think of as an integrated effort involving the full marketing mix (we really do think this regardless that Levitt states this as well).

As we are consultants, we’re obliged to look at these two dimensions in the old two by two matrix, and we thought it would be interesting to map the participants answers back into these four quadrants.

While we are not necessarily surprised by the results of this little exercise we are interested in the correlation between the respondants answers and what this means for their respective businesses. Our hypothesis, and what we have experienced with our clients is that those companies that view marketing as an integrated set of activities (think 4P’s including customer service) to satisfy and retain customers perform stronger then those that view marketing as purely a communication function (i.e. advertising) and or purely to drive internal business results (which in our view comes as a result of satisfying a customers need).

What this means for 74% of respondents to this survey is there is an opportunity to deliver more meaning and value to their respective organizations through either shifting their focus to delivering on their customers needs and satisfying them day in and day out and or shifting marketing’s sphere of control to encompass all aspects of their business that impact their customers’ experience and satisfaction.

In full disclosure, one of our partners, Russ Lange weighed in with the following; Marketing is the sum total of everything a company does, intentionally or unintentionally, that affects current and future customers, competitors and partners.

A recent study performed by ANA showed that 71% of marketers report budget decreases for 2009.  Now I’m not an economist nor do I pretend to be one but I would like to think that the stock market’s performance this week is a signal that we have seen the bottom of this economic recession.  Unfortunately due to the domino effect that is taking place in the market, near term demand will most likely continue to suffer and what this means for most marketing leaders is a second, maybe third round of budget cuts is coming down the pipe.

While this is the reality for marketing leaders, now more than ever is the time for marketing leaders to be the voice of reason and truly be the chief customer officer to ensure that investment and cost cutting decisions have your organization’s customers in mind.  If a company is not careful it may perpetuate a business “death spiral” where cost cutting impacts customer satisfaction and demand, which in turn impact top-line revenue creating the need for yet further cost cutting.  As the name alludes to, this downward spiral typically results in difficult position for any business to re-emerge from and can be avoided by maintaining a customer perspective during these trying times.

For more information on common steps that marketing leaders can take to address this challenge check out our article, Go to Battle for Your Customers. 

It’s been well documented that the economy is presenting marketers with increasingly difficult challenges on a daily basis. But we believe the recession also provides new opportunity in at least one area: marketing performance. Now is the time for companies to put the practices in place that will ensure they are making smart decisions and practicing results-driven marketing.

Read this article we published on MediaPost’s Performance Insider for ideas on what critical steps you should be taking to survive upcoming budget cuts while building a foundation for marketing performance long-term.