The only processes you cannot outsource are leadership and marketing. As the CEO or business owner you're responsible for ensuring that your marketing process is built out successfully and works well.
Our two guest experts talked about how to do that.
Guest Mitchell Goozé of the Customer Manufacturing Group, Inc. described his vision for using the tools of Process Improvement to create a robust and powerful business system for generating loyal customers, reliably and repeatedly.
My second guest was Mark Stevens, CEO of MSCO "The Art and Science of Growing Businesses" at www.MSCO.com and www.YourMarketingSucks.com.
Mitch believes that the principles and disciplines of manufacturing -- specifically, of process improvement -- can be brought to bear on any and every business process, including the notoriously squishy and hard-to-define and hard-to-measure processes of marketing and sales.
As the leader, you need to ensure that you define what marketing will do -- must do -- including requiring the use of process improvement tools.
Mitch's title for his group, "customer manufacturing" is intended to imply both that marketing can be made repeatable and sustainable, that it can be continuously improved, and Mitch believes strongly that the creation of loyal, profitable customers is a set of business processes.
Folks frequently push back, because marketing is "creative" and it's wrong to put them in a box or turn people into robots. That's not the concept at all.
Every business activity is a process. And every process can be improved.
Everybody pushes back on this. Mitch was in the semiconductor industry decades ago, and listened to a pitch to use lean techniques and process management principles in that business. The VP of Manufacturing said "that crap will never work in our industry." And of course that's the only thing that works in that industry today.
As we look at marketing specifically, we have to respect that it does have a lot of variability. That's not unique. Think about the Emergency Room of a hospital, which is highly process driven and is designed specifically to handle the unknown. No matter what shows up in the ER, the folks there can make their processes work to handle it.
Mitch directs people to three major tools for improving marketing:
- Bottleneck Theory - finding constraints
- Lean Thinking - remove things that don't add value to the customer
- Continuous Improvement - getting a little better every day
Lean in particular has to be defined as "adding value to the customer" rather than "costs us money and we want to charge for it".
Marketing has been driven for the past 50 years exclusively by gut feel. We can do better. Process management gives us tools to do that.
The first step is to create a simple Process Map - use sticky notes and a wall - to build a visual picture of the process and its steps.
As you do that, you may find that Process A starts something and Process C finishes it, and Process B is missing. The visual picture makes that very clear. You can fill that temporarily with a different colored sticky labeled "MOH" for Miracle Occurs Here.
The visual picture very quickly and easily reveals:
- Dead ends
- Non-value-add activities
- Missing steps
The next thing to do is to figure out what to measure within the process. If you only measure at the end -- did we sell anything today? -- you're flying blind. You can measure "good enough" rather than worrying too much about being perfect immediately. You'll get better.
The full, comprehensive process model for generic marketing and sales is huge. It took Mitch and his group five years to finish theirs.
As Deming put it, "All models are wrong, and some models are useful."
So don't go for the whole thing at once. Start with something small. Start with something worrying or difficult or broken. You can get an amazing number of quick wins.
One payoff that happens almost immediately is that the conversation becomes different -- it shifts from a who-to-blame conversation, and becomes a conversation about what inputs are needed, what outputs are desired, and so forth.
There's a terribly common problem when marketing and sales are mis-aligned, because the outputs of one are not the inputs of the next. It's the leader's job to ensure that the alignment is there, by making the goal of alignment clear.
Why do we cut marketing in a downturn? Because we see it as an expense. Why do we see it as an expense, not an investment? Because its outputs are vague. Most processes, if you cut their budgets 10% they can tell you what effect that would have -- for marketing they often cannot.
Marketing is the only thing you cannot outsource.
Marketing is the alignment of your company's abilities with your customer's needs.
For example, I give talks, and at the end a person from the audience may give me her business card. My process is, or ought to be, to capture that person's information and follow up with them, to capitalize on the trust and rapport I've established and begin to create a trusting relationship. My main use for that contact info is to send them a newsletter once a month.
Is there any correlation between the newsletter and buying behavior? Yes -- I get a lot of emails and calls within the first 48 hours after the newsletter arrives.
How do I want to improve this? I think I'd be better served by sending an immediate email when I enter them in the database, telling them to look for the newsletter later.
I could measure the effectiveness of that initial email by asking, does the opt-out rate go down when I send out the immediate email, and then follow it with the regular monthly newsletter?
What am I doing to help the right customers buy sooner? Try things, measuring each time to see what the customer response is.
Mitch's final point:
Process thinking -- regarding flexible, adaptable processes -- will improve your marketing and sales efforts.
My second guest, Mark Stevens, is the author of the provocatively titled book "Your Marketing Sucks" and the founder of MSCO.
Mark had multiple experiences as a business owner that left him feeling that the firms he was hiring to do marketing were dreadful. He built businesses and sold them, and kept hiring marketers who didn't understand business. Yet we find people migrating into marketing roles because they are "creative" and they "like people" and somehow many of them feel that they don't need to understand business -- they don't understand how to read a P&L, don't know how to read the annual report, don't know organizational structure, don't know how marketing needs to integrate with sales.
Marketing is solely about growing your business' profitable revenue. Period. It cannot be a sideshow. Marketing should drive the business. Marketing should be all about growing profitable sales.
Marketing is a highly abused word -- Mark's people don't meet with a client by carrying in a portfolio of past work, or a Powerpoint. They come in with their brains.
The goal is to create a customer experience of love for you -- not "like" but "love".
So the marketing firm needs to understand your business so much that they tell you how to best use marketing. Mark's firm doesn't take orders from clients -- "we don't do what you tell us to do. Your doctor doesn't take orders. Good marketers are not order takers."
It's a collaboration where the the client's needs are combined in a synergistic way with the marketing expertise of the marketer.
Mark's blog "Unconventional Thinking" -- is the #6 marketing blog in the world -- and it's about observations on life.
Mark's book was titled as it was -- Your Marketing Sucks -- because it needs to grab attention -- like a "positive car accident" -- just the way you'll stop what you're doing if you hear or see a car accident, the marketing should somehow grab the attention of the prospect in that same fashion.
Too often people want to be timid and middle of the road, they want to copy what others do, they want to emulate others, and they end up hiding in the crowd.
The biggest cost any business incurs in marketing is the opportunity cost -- what you could have done with your time and money, yet didn't do, because you were busy doing other things.
People will come in to see Mark and say they haven't done any marketing in five or 10 years because "it didn't work" -- and looking at the messages they tried to use, it's no wonder it didn't work.
C + A + M = PG
Mark's theory and methodology can be described with the formula C + A + M = PG -- you should Capture the client, Amplify the relationship, and Maintain the relationship, and it will result in Profitable Growth. So many times you'll see companies that are good at one but not another of these three elements -- they take an order, and then never contact the customer, and not speak with them until they re-order.
It's better to view your database of customers as your family. You have members of your family that you talk to regularly -- it just wouldn't feel right to go more than a certain amount of time before you talk with them, or email them, or send them a note. Think of your customers that way, and stay in contact with them.
To amplify the relationship doesn't always cost money. Mark relates going to the same hotel -- the Fairmont Waterfront Hotel in Vancouver, BC -- for many months on an extended project, and eventually the day staff all knew his name. Then one night he arrives very late. He's never even met the night staff of this hotel, yet they all greet him by name.
How did they know his name? Because they have a program of identifying their most frequent (and thus profitable) guests, they make a point of getting the guest's photo -- either from Google, or they call the guest's assistant and ask for a photo -- and circulate the name and photo to the staff before that guest is expected to arrive.
Mark felt like family. He would never consider changing hotels when he stays in that town. He's mentioned this story multiple times over the years in interviews on TV and radio. This hotel's biggest salesmen are their happy customers.
As Patricia Fripp likes to say, the real sale happens after the sale.
Keep asking yourself, am I Capturing, Amplifying, and Maintaining my client relationships? How well? How can I do better?
Too often employees don't know the company mission, and they think their job is to make the boss happy -- it's not. You have to make the customer happy.