What's New in Marketing - Issue 51, November 2006

http://www.wnim.com

Do marketing measurements indicate management performance?

Measuring management performance is a sensitive art. Nicolas Watkis of Contract Marketing Service believes that marketing managers must not be blinded by numbers when evaluating their success.

“If you can't measure it, you can't manage it” said Peter Drucker. This statement applies as much to the marketing function as it does to every other part of business. However, the statement does not say that “If you can measure it, you can manage it”. Measuring marketing performance does not guarantee good management, but is an indicator of management performance.

Marketing, which generates profit by anticipating and satisfying customer demand, requires considerable investment in money and resources, and is at the heart of every business. It is much more than just the advertising budget, and to measure the return on marketing investment requires a deeper understanding of all the activities which go to satisfying customer demand profitably. If all marketing is investment, why would companies not want to assess the returns on their money?  Increasingly Chief Executives and Financial Officers are looking to ensure that measurements of the return on investment are used across the whole business area, including marketing. Marketing managers must now not only deliver a return on the investment but also be seen to do so and be able to prove it.

Marketing is a broad subject, covering every aspect of a business that anticipates and satisfies customer demand profitably. It follows that marketing encompasses a wide variety of subjects from market research, product planning, selling, advertising and promotion, distribution, business planning and a host of other aspects that are not purely finance or production centred. For the executive charged with managing the marketing function of a business, the diversity of marketing activities, means that the job is a complex one. In many companies, the chief marketing executive may not be a professional marketer, but is a manager responsible for a staff of professional marketers and employees. For the executive responsible for managing the whole of the marketing function, it is often difficult to know where to start.

Marketing has changed significantly over the past twenty years. Up until the early 1980s, most marketing activities were manual processes. Data bases were based on card indexes, spread sheets were manually created, with calculating machines only becoming available from the mid 1970s. This meant that all marketing activities took a long time in preparation and delivery. Analysis of marketing activities was limited, and the convenient view that marketing was an art not a science, allowed the misconception that market performance could not be measured to be the generally accepted view.

Computerization has now swept most of those preconceptions away. The revolution in the marketing function means that manual activities, which in the past took days or weeks to complete, can often now be done automatically. A sales and profit projection which may have taken hours to produce in the past, may now be repeated, with varying inputs, to produce a variety of scenarios in a matter of minutes. Businesses are now able to measure performance across all marketing activities and to quickly identify business opportunities, threats and trends. As the amount of this information has grown, so has the complexity of managing the many aspects of the marketing function.

The purpose of any commercial business is to make profits for the benefit of its shareholders and employees by satisfying customers. The objective of the chief marketing executive (CME) is to maximize profitable revenue while minimizing costs and the use of assets. Maintaining the relationship of profit, costs and assets used is the marketing management problem.

To achieve this objective, the CME must often manage a team of marketing specialists, and ultimately be responsible for a variety of delegated tasks, including planning, market research, selling, advertising, distribution, and many other customer related activities. However, the most important asset at his or her disposal will be the delegated experienced staff, who carry out the specific activities. To be successful, the CME will require good leadership skills to inspire, motivate, direct and encourage the staff, to whom he must delegate responsibility to deliver results. At the same time, the CME must institute the continuous management process of the marketing cycle for managing marketing and business information and for the development and execution of necessary actions, including the continual assessment and reassessment of performance.

In Dr James Rieley's book Leadership (Daily Telegraph/ Hodder and Arnold), he points out that a pre-occupation with numbers can blind the manager. After all, it is people who get results. Metrics and measurements provide an excellent guide to the immediate past performance of all the marketing activities, but their future performance is dependent on the staff involved who have to deliver them.

The CME will rightly be judged on the measurements of marketing performance he delivers, but that performance will be dependent on his or her ability to motivate, organize and lead the marketing team to achieve their objectives. Measuring marketing performance is an essential indication of recent past and current performance to identify where resources and assets are used to best effect. Only effective leadership and management can direct and motivate the staff to maximize marketing performance and achieve marketing objectives.

About the Author

Nicholas Watkis of Contract Marketing Service, (Specialists in Measuring Marketing Performance and Return on Marketing Investment.) For more information please visit:

http://www.contractmarketingservice.com/

http://www.businessperformancemaximized.com/

Will ‘non-green' brands survive?

The survival of ‘non-green' brands was the subject of a panel discussion hosted by world research organisation ESOMAR recently in London. What's New in Marketing reports on the views of a renowned environmental thinker, a major supermarket, a brand owner and two leading market researchers.

‘Green' has moved from niche money-costing point of principle to mainstream money-making marketing advantage. That was the overriding view of the panel at a recent breakfast discussion hosted in London by research organisation ESOMAR.

‘Will non-green brands survive?' was the subject under debate against a back-drop of rising concern about climate change. Chaired by John Kearon, founder and chief juicer of Brain Juicer, a diverse panel – including a leading environmental thinker, major supermarket, brand owners and market researchers – discussed the key issue of sustainability and what this means for brands and organisations.

Sixty per cent of consumers now believe industry / companies are at fault for causing environmental damage or climate change (Henley World 2006 survey). The same survey revealed that only 10 per cent of consumers saw impact on the environment as the key factor when deciding which product or service to buy.

Will Galgey, director Henley Centre HeadlightVision, said: “Environmental concerns are just part of a number of purchasing decision criteria. We are consumers first and environmentalists second. However, people do believe that by shopping ethically they are making a difference – it gives them a level of personal comfort.”

Green is now sufficiently persuasive to make environmental relativity an advantage. A hypothetical example, according to Galgey, being where a gas-guzzling SUV manufacturer claimed 20 per cent lower emissions than other SUVs giving it a perceived green benefit and so real advantage in the market.  

“Non-green brands will survive – despite societal pressure on business,” stated John Elkington, SustainAbility founder and author of Cannibals with Forks: The Triple Bottom Line of 21st Century Business.  However, Elkington believes there is a ‘rising tide' scenario where key individuals and major organisations are beginning to make sweeping changes. Lee Scott, CEO of Wal-Mart, for example, has recently announced the start of a move to green the retail giant's supply chain.

As retail giants such as Wal-Mart and Tesco start surfing the rising green tide, will the original green lobby groups push further and become even more extreme, or will they celebrate victory and exist merely to monitor progress?  Elkington's view was there would be work for green groups for some time as there was still a long way to go before supermarkets' actions make a real difference. Breakthrough change from governments is required to force a difference, stated Elkington: “London's congestion charge and the smart move to make alternative energy cars free of charge is a great example.”
Customers are not prepared to give up quality in a food product like chocolate to go green, stated Mark Palmer, marketing director, Green and Black's. “Taste and quality are just as important for consumers buying Green and Black's organic chocolate as green issues.”

Organic chocolate may have appeared a niche, even intimidating, proposition when Green and Black's chocolate first launched in 1991. But clever marketing and the rising green tide, has enabled the brand to become not only synonymous with intensely flavoured, luxury chocolate but also the UK's fastest growing chocolate brand. The tipping point came when the brand achieved distribution through the major supermarkets. Today, the Green and Black name seems to be symbolic of the equal status of green issues with mainstream money-making brands.

With 16 million customers a week, Sainsbury's believes they have to help customers' green decisions by enabling an ‘edited choice'. Consumers want to buy ethically but in reality have limited time and energy. They need to be confident that their chosen retailer has made good decisions on their behalf.

Alison Austin, head of brand policy and sustainability at Sainsbury's, quoted fish supplies as an example: “Sainsbury's has developed and launched a fish sustainability strategy including our own assessment system with input from the Marine Conservation Society (MCS). As we are assessing all our fish types and sources, customers can buy any fish from Sainsbury's knowing we have done all the hard work for them - so meeting the objective of fish for today and fish for tomorrow.”

Austin added that retailers can make some changes quickly to respond to sustainability issues but when dealing with growing cycles of primary agricultural products it can take several seasons to bring changes from the field into the store.  Sometimes this is not as quick as campaigners would like. The challenge for a supermarket like Sainsbury's is the constant balance between responding to current demands and moving towards anticipating them. “With long lead times we are often working today to put changes in place that customers will not see for some years,” Austin stated.

David Bickerton, general manager, brand and group communications, BP plc, commented on the current paradox for energy companies. “We are at the sharp end. Energy demand has doubled in the last 30 years – and looks set to continue. Yet there is a growing concern as to how this energy is produced.” BP has announced the targetneutral initiative to allow motorists to calculate and offset their emissions by donating money to the development of renewable energy sources. “Raising awareness of the links between driving and climate change has to be a good thing. Helping consumers become more carbon literate is part of our role as an energy company." BP  announced last year that it  is spending some £8bn  over the next 10 years in developing low carbon alternative energy solutions. 

Word of mouth will put more pressure on companies and brands to operate in a sustainable way, according the Stephen Phillips, director of Spring Research. The shift from geographic communities to multiple social and on-line communities, combined with multi media communication, means peer not expert opinion counts today. Phillips said: “Brand trust is easily eroded with the Internet and the sense that brands are becoming more detached as distribution channels and customer call centres are often outsourced.”

While customers are demanding a degree of sustainability from companies, Phillips believes that price and fashion are still more important for many UK consumers. It will take a significant lifestyle choice - as in the Nordic countries - to force non-green brands from the market.   

About the Author

The breakfast discussion took place ahead of ESOMAR's 2006 Annual Congress in London - the world's largest annual meeting for professionals in research, marketing, and advertising, representing over 60 different countries. Sustainability was one of the current hot topics debated at the Congress. ESOMAR's 60th Annual Congress takes place in September 2007 in Berlin. ESOMAR is the world organisation for enabling better research into markets, consumers and societies and has 4000 members in 100 countries. http://www.esomar.org/

Marketing for Profit - and insights from leading lights

CIM's National Conference offered food for thought and ammunition to help marketers achieve the recognition they deserve

It was an early start to the day for those who had travelled in to London that morning. But by 8.15, marketers from all parts of the UK (together with many who'd come from significantly further away) began to arrive to take their place at CIM's National Conference. And with marketing guru Philip Kotler kicking off proceedings at 9 o'clock sharp, no one wanted to be late.

Dr Kotler, Professor of International Marketing at the Northwestern University Kellogg Graduate School of Management in Chicago, has been described as ‘the world's foremost expert on the strategic practice of marketing'. And judging by the rapt silence in the conference hall as the professor spoke, it was clear that none of the 220 delegates were about to question that title. If any one had dropped a pin, you would have heard it.

Dr Kotler began by reminding us that marketing evolves. The current edition of his block-busting text-book ‘Marketing Management' covers topics such as ‘the internet' that were not a consideration for even the most foresighted of marketers when the first edition was published. 

Senior management is demanding more accountability from marketing, and today's marketers must demonstrate how major budget items will increase shareholder value. If marketers were finance minded, they wouldn't be marketers, they'd be finance directors. But the weak relationship between the marketer and the CFO – ‘our enemy' - needs to be strengthened. Marketers must track the changing value of key marketing assets, including brands, customers, service quality, stakeholder relationships, intellectual knowledge and corporate reputation.

Dr Kotler then went on to pose a question. If we were given the choice, where would we like our office to be located? Next to the CEO, the CFO, the Chief Technical Officer, the Chief Information Officer or the Vice President of Sales? Perhaps prompted by the professor's earlier remarks, and remembering the proverb ‘keep your friends close and your enemies even closer', the CFO was the most popular choice among the audience.

But the correct answer according to Dr Kotler was that we need to be close to all functions within the company and have a relationship with all five areas of the business. Dr Kotler reminded us, as David Packard of Hewlett Packard once said: ‘Marketing is too important to be left to the marketing department'.

The next speaker, Robert Nuttall of Rolls Royce explained the complexities of marketing in the aero-engine environment, where a deal can be worth a billion dollars, and the client relationship lasts up to 50 years. This high value, intimate and long lived relationship was contrasted with the challenges faced by Sainsbury's, where customers spend around £100 and may change to anther retailer after a week, and Coke, where the individual ‘deal' is worth a matter of pennies and the more transient experience lasts only minutes. But whatever the business model, marketing must be regarded as the driver of strategy, not a cost.

After Robert Nutall came John Elkington, co-founder of SustainAbility and author of the million-selling book The Green Consumer. Mr Elkington outlined the increasing importance of ‘the triple bottom line'. No longer are organisations able to judge their performance on financial measures alone, he explained. Today we also need to consider the social and environmental impact of our businesses. We now need to consider the ‘three p's' of ‘People, Planet and Profit' when assessing the success of our businesses. And this will be so much more than using ‘green' language and hoping that everything will fall into our laps. People who run businesses will have to give more and more thought to sustainability, and marketers also must play their part.

The debating sessions that followed in which delegates were invited to quiz a panel of experts on three hot topics, provoked heated discussion. In a session chaired by Daily Mail Columnist Amanda Platell, marketers were asked to consider whether marketing's place was in the field or in the boardroom, echoing themes covered in Philip Kotler's keynote address. The debate concluded that BOGOFs were not the future of marketing, and marketing did indeed deserve its place at the heart of business strategy.

A second session aimed to generate answers to difficult questions from boardroom peers about the value of marketing, and explored whether marketing is a sales tool or a strategic discipline. Angela Hutton, lead tutor on CIM's Executive Development programme spoke of the importance of team effort between sale and marketing functions – with marketing selecting the targets and making the bullets, while sales holds the rifle and pulls the trigger. Perhaps not surprisingly in a room full of marketing professionals, the motion that marketing was nothing but a sales tool was defeated.

Meanwhile in the third debate, which built on the subject of John Elkington's presentation, delegates explored the long-term benefits of a focus on ‘the triple bottom line'. This debate concluded that consequences of making mistakes when it comes to sustainable development are too serious to ignored, and the motion that an awareness of 3BL just complicates marketing and is of no help to business was dismissed.

After lunch, delegates returned to hear Simon Hawkes, MD of Loyalty Management Services which operates Nectar Card. Mr Hawkes outlined how technology can be used to inform and enhance an organisation's marketing activity. He cited the example of the Nectar Card's Home Movers kit to illustrate how to provide information that is timely, relevant and personal. The kit, which is sent to the homes of people who have recently moved, contains a personalized map featuring local shops where Nectar Points can be collected together with a selection of vouchers. The feedback to the initiative has been very positive, with some customers even reporting that they forwarded the map to friends.

A selection of master-classes followed this presentation, and delegates were invited to choose between three sessions. A class on the subject of technology enabling profitable marketing was hosted by CIM's Lead Writer Mark Stewart and Chris Dadd of Win plc. It examined the key elements and proven technological techniques for professional marketing practitioners and illustrated how they can directly improve profits. Award winning copywriter Jonathan Gabay lead a session on profiting from creativity on the internet and offered a wealth of practical tips on how to create web sites with real sticking power. And the third master-class on the interactive market hosted by Michael Nutley, editor of New Media Age took a closer look at how organisations can use interactive methods to positively affect profits.  

The conference was concluded by Sir John Banham, who has headed some of the world's leading companies, including Johnson Matthey plc, Kingfisher and Whitbread and was Director General of the Confederation of British Industry for five years. Sir John explained that 20 companies who were in the FTSE 100 index in June 2005 were no longer on the list, and that the expectancy of companies between birth and ‘the other thing' was just 25 years. Marketing plays a crucial role in keeping companies in robust health. Marketing is not a department, Sir John maintained, it's a state of mind. Organisations that have a marketing mindset will be those that succeed.

It was the end of a day crammed with inspiring and illuminating sessions. But it was not just the presentations, debates and workshops that were useful. During breaks in the formal business of the conference, delegates were able to visit the Marketing Expo. Here they could meet representatives from a wide range of companies, including Management Today Magazine, recruitment company Hays Marketing, the Oxford College of Marketing, B2B Marketing Magazine and a number of other organisations specialising in marketing related areas such as graphic design, marketing software and copywriting. With delegates present from all walks of the marketing profession, it also provided a great opportunity for networking.

And as the delegates left the conference hall for the evening drinks reception, the consensus was that it had been a day well spent. Lucy Mansfield from Blackwell Publishing, who is studying for her Post Graduate Diploma, said the knowledge she had gained from the conference would provide valuable support for her studies. Linda Landles of WoodHolmes Group said she found John Elkington's presentation particularly interesting, while Miranda McLean of Reuters said that Philip Koter's presentation had inspired her with suggestions for new techniques to take back to her department.

But perhaps the most enthusiastic endorsement of the day had come earlier from Graham Clarke of Certified General Accountants. When Graham, who had travelled from Barbados for the conference, was asked if he thought his journey would be worth while, he replied: ‘It's been worth it already'. It was only 11 o'clock.

Making marketing inclusive

Kevin Thomson of the Hidden Differences Group explains why marketing and communication must be accessible and inclusive.

There are five good reasons why every marketer and business communicator should take note of an issue that so far has eluded just about everyone. This includes their advertising agencies, design agencies, and let's not forget the below-the-line agencies, and especially web designers, as well as print.  I am sad to say, it eluded me too in my lifetime in marketing until recently, through my initial involvement with a family member with learning difficulties.  Since that time, my team and I have been working on this issue with many experts in the field to raise awareness and provide help for our profession. I believe the opportunities for all marketers are truly significant.

I refer to the world's largest untapped, unrecognized and often simply unloved market – of millions and millions, in the UK alone. The great thing for everyone in marketing is that if you cater for this market, then everyone else will benefit. Customer and companies benefit; stakeholders and investors benefit; public and private organizations benefit.

The untapped market of those with ‘communication needs', such as sight, hearing, literacy, language and learning difficulties, is enormous. The ‘everyone else' market is vast too because we all have ‘communication preferences'. The good news is that the solutions marketers can provide for those with real communication needs match almost identically the solutions for everyone else, with their own personal communication preferences. For example, speech enabled websites and talking RSS feeds for those with sight and dyslexia needs are vital; and so too, talking web text, and RSS feeds direct to your MP3/iPod, for everyone with ‘time starved' preferences are critical too.

Here are the five reasons why we in marketing will really, really want to do something, now. I'll call them the 5R's of Marketing Communication Performance – ROI, Revenue, Reach, Reputation and Responsibility. And if you could enhance all of them – big time – in one go, wouldn't you be interested and really want to do something new, different, and better?

Then there's the law, (DDA 1995/2005), that requires you to do something to comply. Finally there's the ‘good' in all of our profession that says (just an example) that we don't just give 1% to Africa on all RED branded products but we actually look to making our very own products of words, design, copy, packaging, small print, instructions, text, adverts, promotions etc more effective for everyone – of all ages and abilities and in all countries through the web and print.

But first an admission. I am dyslexic. I didn't discover this until I started working with experts. As I get older I have sight issues, and I have more ‘differences' besides. Yet despite my hidden differences I, like everyone else, simply prefer some forms and styles of communication over others. All of us have, or will have, communication needs at some time in our lives, and that means you – you will get older! In addition, we all have communication preferences. Let me explain the distinction I make.

Communication NEEDS are where we ‘have to have' our marcoms served up in a special way, for example spoken or BIGGER text for those who can't see well, or can't read, or have English as a second or third language and need to hear it, not read it. Secondly our communication PREFERENCES are where we ‘like/want/prefer to have' our marcoms served up in the way that suits us, for example, saving text as an audio file for listening later/on the train/in the car on our MP3/iPod.

I will illustrate the ‘needs and preferences' concept - and the massive size of the market, using myself as an example. I am neither unique nor alone.  I hope my raising these issues will help stop marketing simply offering a one size solution on everything it produces. Our words are our brand, and too many brands are unrecognisable, by too many.

It is only since becoming involved in the world of what I call ‘hidden differences' that I have discovered I am dyslexic. Yet I discovered there are 5 million others in the UK like me. Spelling is only one of the issues I and others face e.g. words ‘dance' on the page making reading much text almost impossible. I also have discovered my ‘visual stress' - the glare of black text on white slows my reading down by 30%, and has done all my life. There are an estimated 20% of the population i.e 10 million in the UK with visual stress (Meares-Irlens syndrome). Probably, like me until recently, they have no idea it even exists. I also have a pretty high attention deficit problem - anything distracting like a Flash driven website, well, distracts me.  Oh, I forgot. I'm over 50 so I need glasses and big or spoken text will become ever more critical – and here's the thing - the over 50's have 80% of the wealth of the UK population. That's most of it!

There are my needs. What about my preferences, and yours and everyone's? Don't you just hate small text anyway? You hate the glare of white backgrounds – 80% of people do too, that's over 40 million. You want to access a website on your 3G phone or pda but it's too small to see, but you would be happy to hear it spoken. You want to listen to reports, and your e-mails, on the move, not read them – I could go on, but you get the idea.

The solutions? First the ‘thinking' behind opening up this market. A group of highly involved and committed people working with the sponsorship of 2080partners, like the BDA, RLSB, RNIB,BPIF (for acronyms and others see http://www.welladjusted.org.uk/ ) got together to create the Great Communication Guide. There is a free pdf version on the Well Adjusted website. If you only take note of half of the advice in the guide, you will be well on the way to meeting your 5R's.

Secondly the practical solution. Having spent the 80's and 90's developing the concept of internal marketing, I have now come to realize the massive impact on the 5 R's by meeting the needs of the world's largest untapped market – the 20% with hidden differences on external as well as internal audiences. Meeting their needs benefits the other 80% of the population, by making marketing and communication material flexible for all. Working with a range of designers with communication difficulties, we have developed a range of tools, techniques and training. These are being launched fully in 2007 and will be used by the voices of our profession and many others like the Advertising Association, IPA, IAA, ICSA as well as a growing band of leading associations and charities, including PATOSS and the Independent Schools Council.

I think you can work the list of 5 R's benefits out for yourself:

1.          the greater ROI - return on marketing investment

2.          the greater Revenue from satisfying new and existing customers;

3.          the greater Reach of at least 20% of the market – 10m in the UK;

4.          the greater Reputation of brands who care about every individual;

5.          the greater Responsibility of complying with laws like the DDA and meeting the needs of the disadvantaged.

You can get all this, and more if you can let your customers, staff and community be able to say “I'd like this website in BIG type, easy to see colour, with a simple design that doesn't distract, a point and click text player in every major language, so I can listen later and get my RSS feeds when I want.” This is no longer a pipedream, but a reality. Technology does more than just inform, it informs and educates and excites – and now provides solutions to suit everyone. So too can technology can provide ‘Print and Publication On Demand'. We call it P-Pod.

So ought to, have to, or do you really, really want to make your marketing and communication accessible and inclusive and better for everyone else too? As it will enhance your return, revenue, reach, reputation and responsibility, can you afford not to?

12 reasons to make accessible and inclusive marketing a number one Priority

1. People with communication differences – those who have, for example, dyslexia, ADHD, low vision or visual stress or poor hearing - are estimated to account for about 20% of the UK population, yet 94% of the Fortune Top Global Corporations make little or no accessibility provision for this huge group (source:  2004 Big Button Survey by the Communication Foundation)
2. 80% of the wealth of the UK is in the hands of the ‘silver surfers'. Yet while everyone over 40 loses their sight as the cornea hardens, only 4 out of the FTSE 100 have a specific large text option.  Big print is a good idea when selling to those with the most money.
3. Accessible websites are read 33% faster. The ‘stickability' of accessible and inclusive websites are a benefit to all.
4. There are 300 languages spoken in London. Few websites even offer free Babelfish let alone have text to speech in alternative languages.
5. 20% of people have ‘visual stress' and need a coloured background to reduce glare. 80% of people prefer a coloured background. The majority of print, word documents, emails and websites are in white.
6. Three million people with sight difficulties and dyslexia are denied the right to read in this country because most publications are never available in large print, audio or Braille formats (source: RNIB)
7. 4% of people in the UK are severely dyslexic and a further 6% are mildly dyslexic. That's 6 million people in the UK. (source:  British Dyslexia Association)
8. Entrepreneurs are five times more likely to be dyslexic (source:  2004 Simfonec research carried out for the Cass Business School, City of London). B2B marketers take note.
9. Over 7 million people in the UK have hearing difficulties ranging from being hard of hearing to completely deaf.  Of this number, 70,000 use sign language as their preferred source of communication and 250,000 are regular signers. This figure includes families of deaf people (source: British Deaf Association)
10. 15% of the UK population has a literacy issue. This is a real issue in an increasingly regulated world where people have to have read and understood ‘small print'  e.g. The TCF Treat Customers Fairly campaign in the Financial Services Industry.
11. The Disability Discrimination Act (DDA) prohibits discrimination against disabled people in employment and tasks employers with making ‘reasonable adjustments to their premises or employment arrangements, if these substantially disadvantage a disabled employee or prospective employee'.  Most companies interpret this as ensuring there are disabled loos and ramps, but ignore the bigger picture – communication friendly websites, emails, advertisements, literature, and direct mail.

To listen to the reasons why accessible and inclusive marketing should be a priority click here. (MP3)

About the author

Kevin M Thomson, FCIM, has pioneered the use of internal marketing and branding inside organisations for more than twenty years. He was founder and President of the Marketing and Communication Agency, (MCA), Europe's foremost internal marketing agency, acquired by WPP in 2001. Kevin has written numerous published articles and many management books including the ground-breaking Employee Revolution (FT Pitman), Emotional Capital, Passion at Work (Capstone) and The Company Culture Cookbook (FT Prentice Hall).

Taking a tip from the marketers

Clare Williams Fannin of Templemere Public Relations explains how training departments can exploit some of the techniques used by marketers to raise their profile.

Most trainers will rarely give much thought to ‘marketing'. Some will believe it to be an activity that concerns only an arty bunch far removed from the realities of business. Few will share the marketer's passion for branding, marketing research or promotion. And in the very worst case, they will be utterly scathing of what Katie Thorp, Channel Sales Director for international sales training and consultancy company Miller Heiman, called ‘the art of taking a simple process of selling something and transforming it into a fiendishly complicated pseudo-science.' 

And yet what self-respecting training professional would not want to improve awareness of the good work of their department? Who would not want their efforts recognised for their full worth and their activities listed high on the boardroom agenda? With increased status, come greater influence, bigger budgets, and better promotion prospects. It is a scenario that would be welcomed by all.

And this is not an impossible dream. The Chartered Institute of Marketing defines marketing as ‘the management process responsible for identifying, anticipating and satisfying customer requirements profitably.' By borrowing some of the techniques marketers use to do this, trainers may well be able to help make the dream a reality.

Successful marketing is guided by three main principles – know what you are selling, know who you are selling it to, and know what your market wants and expects from you. These rules apply to the FMCG marketer shifting toothpaste, the marketing department of a multi-national car giant or the marketer promoting a professional services business. But they could equally well apply to a company department such as training that wants to boost its profile within an organisation.

Features or benefits?

Marketers speak of ‘selling the sizzle, not the sausage'. This is because customers do not buy features, they buy benefits – a customer will purchase a kitchen cleaner not because it contains a particular ingredient, but because it gives them a cleaner floor. Similarly, training departments need to focus not on what they can offer their organisation, such as a three day course on basic German, but how the services they provide will benefit the organisation, such as helping to improve relationships with customers in Germany.   

The question ‘what do you sell?' would appear a simple one. Trainers sell ‘training'. But this definition has its limitations. ‘Training' is an externally-imposed process, from trainer to trainee, while ‘learning' is an internal process on the part of that trainee. The outcome of these two processes is ‘knowledge', and knowledge in turn can be translated into ‘performance'. For an organisation, the value training adds to a business is measured by how performance is supported and improved. This, for the training department, is the sizzle.

Make a stand for your brand

Branding is a hot topic for marketers, but once more, the methods used by marketers to build successful brands can also be used to add polish to the profile of a training department.

The world's leading brands are treated with great respect within an organisation, and a training department should take similar care to safeguard its reputation. Like beauty, a brand rests in the eye of the beholder, and a brand is not what a marketing department tells its customers, but what those customers believe it to be. While the training department may have a clear idea of what it stands for, this is only a true reflection of your brand if that perception is shared by others within the company.

As with any other branding initiative, the branding of an internal department cannot be used as a veneer to disguise a shoddy product – if the department does not deliver, or fails in any one respect, it will win no support. A brand is the consequence of a user's experience of a product or service gained over many years. This experience could range from the pleasant smile of a sales assistant to the failure of a product to do what it promises on its packaging. If a training department is to become a successful brand, it must ensure that every contact it has with others, from a phone conversation with the head of department down to the tidiness of the desks, creates the right impression.

Great brands thrive because they never disappoint – a can of Coke always tastes great. They have a clear identity – it would be difficult to go to a McDonalds and mistake it for another high street chain. And everyone knows what they offer – Asda has a firmly established reputation for delivering good value. By offering consistent quality, defining its role within an organisation and offering a clear and concise range of services, the training department can achieve similar status.

The customer is king

A focus on the customer is another key issue for today's marketer. And again a similar focus is also essential for the training department.

As in any other area of marketing, the training department will only succeed if it meets the needs of the customers and meets them perfectly. As experts in the field, it is easy for the training department to make assumptions about these needs. But we must give our customers what they want, and not what we think they want.

A new brand or product is rarely launched without sound research across a range of consumer sectors. Likewise a training department may have many customers - the ‘end-user' or trainee, the head of the department that is funding the course, or the CEO who agrees a training budget - and it must have a detailed understanding of the needs of each of these groups. By canvassing the opinion of others with the same ruthless scrutiny adopted by marketing researchers and taking some hard decisions in response to these findings, the training department will ensure that the services it offers are sure-fire ‘best sellers'.

While a satisfied customer will occasionally tell others of a good experience, the aggrieved will take great delight in speaking to as many people as possible about their terrible time. Nowhere is this truer than in corporate life, where coffee machine gossip is often fuelled by failings of a particular department, but almost never centres on its virtues. Giving customers the opportunity to complain about the issue and coming up with concrete solutions to resolve these problems will help to convert the moaners into useful allies.

Good marketing is a two-way process. Successful brands thrive because they build close relationships with their customers, give them the opportunity to communicate, and respond appropriately. Trainers must endeavour to foster the same relationships.

A measure of success

In the past, training, like marketing, was perhaps sometimes regarded as an activity that was not vital for business success - a luxury that could be cut when the going gets tough. But if we want our importance to be recognised, we need to prove that what we do matters. In the marketing business, demonstrating return on investment is becoming ever more important. Similarly, within the training industry, efficiency must be monitored – real and measurable results must be delivered. Training must offer not just value for money, but also in today's pressurised business environment where time is precious and few can afford to be away from their desks for long periods, it must also offer value for time.

Marketing success has often been measured by ‘top line' results. If a campaign delivers more sales or greater market share, it is labelled a triumph. But marketing that really makes a difference establishes a connection between top line figures and bottom line results – that is profit.

The training industry faces similar challenges when it comes to measuring effectiveness. Exam achievements, perhaps benchmarked against past years or the successes of a competitive company, can be persuasive. Accreditation from an external and universally respected examination body such as The Chartered Institute of Marketing will add further credibility by providing impartial evidence of success. Training departments should therefore work in tandem with recognised examination bodies to link their in house programme to an industry-wide syllabus whenever possible.  

But training must also be part of a strategic, long-term approach rather than a quick-fix solution to short-term skills shortages, and like good marketing it must be connected to the company's broader business objectives. According to a study by Global Learning, just 30% of training managers measure the impact of training on business performance. But this is essential if HR departments are to show that training is not a peripheral activity, but central to the health of the organisation. 

Blow your own trumpet

Trainers should not be modest about their achievements. A wide range of marketing techniques can be exploited to promote their activities. A dedicated area on a company intranet, a special notice board, or an e-mailed newsletter can all be used to spread the word. Business guru William McGowan once said: ‘The meek will inherit the earth, but they will never increase market share.' This is a message that still rings true with marketers. Similarly the meek may make good trainers, but they will never achieve the boardroom recognition they deserve. 

About the author

Clare Williams Fannin founded Templemere Public Relations in 1991. The company has worked with a number of blue chip organisations including Compass Group, ICI, Securicor and Scottish Courage.

How to harness the power of email

Anthony Braide of Gencia Media shares some tips from the e-marketing trade

Spammers have done their best to give email marketing a bad name. However, email is such an all pervasive communication tool that its use as an extremely effective means of building customer relationships and selling products and services remains un-dented. Imagine trying to run your business today without access to email – it would be impossible. In fact, surveys have found that the vast majority of internet users, cite email as their primary reason for using the internet, despite the spammers best efforts.

While we're on the subject of spam, here's a quick word to the wise, don't do it. It's a really effective way of upsetting future clients and associating your company, products and services with dodgy Viagra, porn and scam artists. Most importantly, spam doesn't work.

However, opt-in email marketing is exploding because it does work. Companies are lured to it by incredibly low costs and high response rates. It's easy to get started and it puts any organisation, large or small, on a level playing field.

Of course, there's a right way and a wrong way to do anything and the vast majority of email marketers are getting it wrong. The industry is young and those who are doing well are not falling over themselves to share the secrets of their email marketing success with competitors. But there is some good news. Unlike conventional direct marketing pieces, email marketing is both cheap and easy to test and the results can be comparatively easy to collate and analyse.

If that's the case then why do so many of the marketing emails that I receive get just about everything wrong? And why don't the senders ever seem to learn from their mistakes?

Learn from your mistakes

The advantage that email marketing has over pretty much any other type of marketing is its trackability. Instant, live results from your marketing campaign were a marketers dream just a few, short years ago. Now they are a reality but not everyone is taking advantage.

Emailing your database from Outlook or using bulk email sending software is usually a waste of time for both you and the recipient. The main reason being that you get little or no feedback, unless a recipient chooses to email you back. True, you can set up a read receipt in Outlook but that only tells you a very small part of the story. Imagine if you could tell, at a glance, who isn't interested in your services and really doesn't want to hear from you again (don't waste any more of your valuable time on them). Or who opened your email and read it repeatedly (wow, those people must really be interested). Better still, imagine if they clicked directly through to your website and you knew what link they clicked on - you would know exactly what interested them.

Fortunately all that information is really easy to obtain if you use a good email marketing tool rather than Outlook. There might be a learning curve of a few days but it's worth it to make your emails 100% more effective.

With this kind of marketing intelligence you can really start to harness the power of email, because email can give you something special – instant, live, two-way communication from every address you deliver to. Even emails that bounce back tell you something – it's likely those addresses are dead and you need to update your database. If you are getting 20% opens and only 22% reads then you know something about your email isn't connecting with your recipients. If it was, they would be reopening the email to re-read it or show it to the boss, so you would be getting a much higher percentage of ‘reads' to ‘opens'.

With this kind of in-depth information you can begin to learn from what you are getting right and what you are getting wrong. You can begin to mould your campaigns and target your messages. Improve your response rates and follow up on click-throughs. In essence, learn from your mistakes and find out what works for you.

Here are 5 tried and tested ways of improving the effectiveness of your emails.

1. Keep your subject lines short and to the point. Longer than 40 characters and they'll be cut off by many email clients. Don't use words like OFFER or FREE or exclamation marks for emphasis!!! You'll be relegated to the spam folder.
2. Keep it simple stupid. Don't make your emails too long or try to cram in to many offers. You've got a second or so to grab your reader's attention so keep it concise.
3. Let your readers know what to do next. Put a clear call to action on your email. A link to your website or your telephone number, big and bold.
4. Make it time limited. Putting a deadline on your email has been proven to increase response rates. Make it clear to your recipients that if they snooze they loose.
5. Time it right. Don't send your email at 10'o'clock on a Monday morning when everyone is manic. It's going to get deleted. Timing is everything so choose a time of day when your recipient will be more receptive.

About the author

Anthony Braide is Managing Director of Gencia Media Ltd who are developers of leading UK email marketing application LiveWireCampaign.co.uk

How Green is my virtual valley?

E-marketing expert Dave Chaffey asks how e-commerce can contribute to sustainability?

When the editor of WNIM said that a theme for this issue of WNIM was sustainability in marketing, my first immediate thought was, there's no connection between E-commerce or online marketing and sustainability. But I was wrong. Although technology is generally seen as a BAD THING when we talk about “Saving the Planet”, think long and short haul flights, TVs and electronic gadgets burning fuel when left on standby, perhaps E-commerce does have some upsides… This article looks at the impact of E-commerce on sustainability and along the way will illustrate some of the fulfillment challenges faced by online merchants.

Think about online shopping – imagine a situation where we no longer traveled to the shops, and 100% of items were efficiently delivered to us at home or at work. This would reduce traffic considerably! Although this situation is inconceivable since most of us enjoy shopping in the Real World too much, online shopping is growing considerably and it may be having an impact. Research by the Internet Media in Retail Group ( http://www.imrg.org/ ) shows the growing importance of E-commerce in the UK. They estimate that:

• 30 billion of retail spending is online
• 10% of retail sales now take place online
• E-retail sales have grown at an average year-on-year rate of 45% for the past 6 months
• E-retail sales have grown 2,000% in 6 years
• 44% of shoppers polled expect their online shopping to increase in the next 12 months
• 540 million parcels will be shipped to the UK's 26 million internet shoppers in 2006

The figures are impressive, but does this make any difference in reducing our shopping trips or have broader impacts? Well it might. The IMRG certainly want us to believe online shopping is green; in the summer it launched a GO GREEN, GO ONLINE campaign. It identified six reasons why it believes E-commerce is green. They are:

• Green effect 1. Less vehicle miles . Shopping is the most frequent reason for car travel in Great Britain, accounting for 20% of all trips, and for 12% of mileage. A study by the Swiss Online Grocer LeShop.ch calculated that each time a customer decides to buy online rather than go shopping by car, 3.5 kg of CO2 emissions are saved.
• Green effect 2. Lower inventory requirements . The trend towards 'pre-selling' online - i.e. taking orders for products before they are built, as implemented by Dell - enables avoids the production of obsolete goods that have to be disposed of if they don't sell with associated wastage in energy and natural resources.
• Green effect 3 . Less printed materials . Online e-newsletters and brochures replace their physical equivalent so saving paper and distribution costs. Data from the Direct Mail Information Service ( http://www.dmis.co.uk/ ) shows that direct mail volumes have fallen slightly in the last 2 years reversing an upward trend in the previous 10 years. This must be partly due to marketing E-mails which the DMA E-mail benchmarks ( http://www.dma.org.uk/ ) show number in their billions in the UK alone.
• Green effect 4. Less packaging . Although theoretically there is less need for fancy packaging if an item is sold online this argument is less convincing, since most items like software or electronic items still come in packaging to help convince us we have brought the right thing – to reduce post-purchase dissonance. At least those billions of music tracks downloaded from iTunes and Napster don't require any packaging or plastic.
• Green effect 5. Less waste . Across the whole supply chain of procurement, manufacturing and distribution the Internet can help reduce product and distribution cycles. Some even claim that auction services like eBay and Amazon Marketplace which enable redistribution of second-hand items can promote recycling.
• Green effect 6. Dematerialisation . Better known as digitization, this is the availability of products like software, music and video in digital form.

How much could E-shopping reduce greenhouse gas emissions?

A study by Finnish researchers Siikavirta et al. (2003), limited to e-grocery shopping, has suggested that, depending on the home delivery model used, it is theoretically possible to reduce the greenhouse gas emissions generated by grocery shopping by 18% to 87% compared with the situation in which household members go to the store. Some of the constraints that were used in the simulation model include: maximum of 60 orders per route, Maximum of 3,000 L per route, Working time maximum: 11 hr per van, Working time maximum: 5 hr per route, Loading time per route: 20 min, Drop-off time per customer: 2 min.

The researchers estimated that this would lead to a reduction of all Finlands greenhouse gas emissions of as much as 1%, but in reality the figure is much lower since only 10% of grocery shopping trips are online.

Cairns (2005) has completed a study for the UK which shows the importance of grocery shopping – she estimates that car travel for food and other household items represents about 40% of all UK shopping trips by car, and about 5% of all car use. She considers that a direct substitution of car trips by van trips could reduce vehicle-km by 70% or more.

However, I believe savings won't be significant since online grocery shopping has proved one of the least popular forms of online shopping. If you look at the sales of Tesco.com, the UK market leader in home shopping, sales for 2005 rose by 32% year-on-year, but they still only represent over 3% of its UK sales of £32.7bn! Tesco said it had 750,000 regular customers and 200,000 orders a week online giving a total turnover approaching £1 billion.

On a positive note, Tesco has committed to a £100m technology investment to help it become more environmentally sustainable. This includes installing wind turbines at some stores.

A broader study by Ahmed and Sharma (2006) has used Value Chain analysis to assess the role of the Internet in changing the amount of energy and materials consumed by businesses for each part of the supply chain. However, no estimates of savings are made.

E-shopping fulfillment problems

Many readers will have faced the problem of missing a delivery for an item bought online. This is not only annoying and costly for everyone, but gives rise to additional journeys from the delivery company resulting in more emissions.

The problem is perhaps not as bad as you might expect as a percentage of all deliveries, but it is still costly. The IMRG (2006) estimates that around 12% of deliveries fail the first time, resulting in costs of around £300 million for the retailers, £123 million for the couriers and even £259 million for the consumers if you cost our time for sorting out the problem. The report estimates that typically it costs 15% less for a business to trade online compared to operating high-street outlets and this is what gives rise to typically lower prices online. However, by reducing the amount of delivery failures, potentially online trading could be still more cost effective.

Can the e-retailers do more to avoid these missed deliveries? A report by Snow Valley (2005) shows that potentially they could through offering more choice. The report showed that:

• 43% of retailers did not offer any delivery options, compared to 46% in 2005.
• Relatively few retailers have specific date options (81%) or time of day options.
• 24% offered Saturday delivery in 2006, compared to 23% last year.

However, larger retailers were more likely to offer specific date, time, or Saturday delivery options, so it is worth considering these if you want to avoid the frustration and those wasted trips.

References

Ahmed, N.U. and Sharma, S.K. (2006) ‘Porter's value chain model for assessing the impact of the internet for environmental gains', Int. J. Management and Enterprise Development , Vol. 3, No. 3, pp.278–295

Cairns, S. (2005) Delivering Supermarket Shopping: More or Less Traffic? Transport Reviews, Vol. 25, No. 1, 51–84, January 2005

IMRG (2006) Valuing Home Delivery - a Cost-benefit Analysis. www.imrg.org/green

Siikavirta, H, Punakivi, M., Karkkainen, M and Linnanen, L. (2005) Effects of E-Commerce on Greenhouse Gas Emissions, A Case Study of Grocery Home Delivery in Finland. Journal of Industrial Ecology, Vol 6, No 2, 83-97 .

Snow Valley (2006) e-Delivery in the UK 2006

http://www.snowvalley.com/report/deliveryreport2006.pdf

About the author

Dr Dave Chaffey is workshop leader for a range of one-day e-marketing training workshops from the CIM:

• E-mail Marketing ( www.cim.co.uk/0766 )
• Running Effective E-marketing Campaigns ( www.cim.co.uk/0767 )
• Improving Your Results from Digital Marketing ( www.cim.co.uk/1138 )
• Marketing Research Using the Internet ( www.cim.co.uk/1135 )

Go to http://www.cimtraining.com/ for course details and online booking.

Dave Chaffey is trainer and consultant for Marketing Insights Limited ( http://www.marketing-online.co.uk/ ). He is a prolific e-business author whose books include ‘ Total E-mail Marketing ', ‘ Internet marketing: Strategy, Implementation and Practice ' and E-business and E-commerce Management .

Read Dave Chaffey's Internet marketing blog ( http://www.davechaffey.com/ ) and sign-up for E-marketing Essentials – the 5 “must-read” articles about online marketing from the hundreds Dave reads each month.