For the CMO Council, the end of the year means two things: Marketing Outlook and the CMO Summit. Both cornerstone events for the CMO Council. and both armed with the intent of laying a course for marketers to face 2008 with fresh best practices and thought leadership directly gleaned from senior marketing peers.

Our stellar lineup of keynote speakers include:

• Steve Knox, CEO of Tremor, a business unit of Procter & Gamble. Tremor is advancing the science of word-of-mouth marketing through its Vocalpoint network of 500,000 active mom "connectors" nationwide.
• Dick Martin, former Executive Vice President of Public Relations and Brand Management at AT&T and author of Rebuilding Brand America - What We Must Do to Restore Our Reputation and Safeguard the Future of American Business Abroad.
• Myra Norton, CEO of Community Analytics and an expert in the study of Human Networks. She has taught at Temple University and Towson University, as well as at the United States Naval Academy.
• Murli Buluswar, Vice President, Insight And Innovation at Farmers Insurance and Pablo G. Azar, Vice President, Marketing Strategy at Allstate Insurance Company will co-present on the strategic use of predictive analytics.

The CMO Summit, this year dubbed The Elite Retreat, is the official, year end gathering of the CMO Council. On December 12, we will descend on Sonoma, CA and gather 120 top marketers from brands like Dell, AMD, Oracle, Coca-Cola, Outrigger Resorts and more to discuss the theme of this Elite Retreat, "Less Burn, More Return". We will have two days to unravel two of the most asked questions at the CMO Council, namely "What is the ideal marketing operational model?" and "What is the magic formula to budget allocation?"

I would encourage you to visit www.cmosummit.org to read about our sessions and topics of discussion. If the speakers, peer-led networking and invention sessions and dynamic panel presentations from brands like Nortel, Oracle, AT&T, Allstate, and Farmers Insurance aren't enough, hopefully, escaping to Sonoma is reason enough to pack a bag and head out to the Summit.

The second focus for the CMO Council to close out the year is the Marketing Outlook survey. The 2008 Marketing Outlook Survey, the largest independent assessment of senior marketing executives today, is an annual global benchmarking initiative undertaken by the CMO Council to review the accomplishments of 2007 as well as scrutinize the top issues and challenges facing marketers in the coming year. Specifically, it will explore projected changes in budget, marketing spend, agency and staff recruitment. Sponsored by Marketo, TechTarget and Deloitte, the Marketing Outlook Survey 2008 will be polling senior marketers to explore these and other critical areas that determine how marketers will track and measure marketing spend as well as allocate their marketing dollars in 2008.

I invite you to voice your insights and opinions, share your challenges and achievements, and join your peers in setting the agenda for marketing in 2008 by completing the online survey by visiting http://www.cmocouncil.org/programs/current/marketing_outlook08/main.asp.

GET TO KNOW CMO:

The CMO Council has embarked on a program aimed at providing a new measure and set of best practices that revolve around the concept of Customer Affinity. Profitability from Customer Affinity looks to determine what drives customer affinity, advocacy and attachment and how brands in the BtoB technology space stack up in rankings of customer equity. The initiative is designed to help members of the technology industry better understand how to improve return on account and customer relationships. This month in our Get to Know a CMO column, we feature a highlight of our interview with Valerie Mason-Cunningham, VP of Corporate Marketing at Xerox.

Cunningham, who has been with Xerox since 1980, is responsible for leading company-wide marketing services that include developing and deploying customer insight programs, customer relationship marketing, customer reference, marketing strategy, customer research, market research, integrated collaterals, global sponsorship strategy, global events management and IT engagement strategy. In addition to these responsibilities, Cunningham provides leadership and support to Xerox’s Worldwide Executive Marketing Council, which represents all geographies and lines of business.

Q: What do you think most impacts customer perceptions and predispositions about companies in the technology sector?

I think some of the impacts that customers have is around the knowledge of the person who is entering the conversation with them about not just their technology but what’s happening in their industry and what’s happening relative to performance issues that are impacting their decisions and their business process.

Their perception is how does one (a) talk to them about what’s happening in the issue of their industry, and then (2) if they have any way in which they can demonstrate what they’re saying is valid. And so whether it’s from a reference standpoint or case studies or situations that would support why they are suggesting what the customer needs. And I think that impacts their decisions.

Also, there’s a loyalty factor about particular brands that are in different segments, like a technology segment, that have a proven record of going in and helping clients achieve their goals.

Q: Have you made some major marketing and communications investments because you felt they were essential to advancing customer affinity and attachment?

We are constantly trying to look at showcasing how marketing is not an expense but it absolutely is one of the ways in which we can enable our business strategies going forward and so, therefore, it should be viewed as an investment. So with that said, clearly we are looking at the way in which we market and communicate to our top customers or certain industries that we have, you know, some of the most reusable and re-purposed solutions across that industry and we are absolutely, you know, supporting those investments. And they are essential to moving forward with the customer brand experiences.

Now, from an affinity standpoint, I would say that we are starting to invest and have been investing in some foundational tools that we can start to drive some better processes that start to get at better analytics so we can see what’s happening with this customer. And actually we’re continuing on that road and continuing to push the marketing community as a whole to understand there needs to be more investment on the side of marketing than maybe we have ever thought about.

A lot of people do not see marketing as having processes that then lead to why you make certain decisions that then lead to executing on something that then feeds back in what happens so that you can continue to make better and stronger decisions around what the customer is really most profoundly looking for of value.

For the complete report on Cunningham’s thoughts and best practices on customer affinity, along with insights from other leaders in Marketing Executives, Relationship Officers and Customer Service gurus, voices from the Channel, and insights from our board of faculty, experts and IT Buyers, be sure to download the Profitability from Customer Affinity report, expected to be published in late December. For more information about the program, please visit www.customeraffinity.com.

SOUND OFF!

A key component of the CMO Council mandate is to engage in superior thought leadership initiatives that bring cutting edge, quality content into the forefront of the Marketing ecosystem. To accomplish this, we often field thought provoking and discussion starting surveys that tap into the insight and opinions of our members and affiliates. At this moment, we have a number of surveys that are open and looking for your insight.

Marketing Outlook 2008
Where will marking lead in 2008? What will keep the CMO up at night in the New Year? What are the plans to tackle challenges and ensure success? These and many other topics are put under the CMO Council microscope in the 2008 Marketing Outlook study. From where budgets are heading to what challenges, accomplishments and frustrations arise, the CMO Council is seeking the insight from senior level marketing executives.
Take the survey now»

Driving the Bottom Line from the Front Line
Driving the Bottom Line from the Front Line is a global research initiative that focuses on helping multinational companies to improve the design and execution of their go-to-market strategies. The program is one of the first international studies of its kind and research with senior marketing and sales officers explore the critical determinants of how companies build capabilities to deliver marketing and sales results in a repeatable and systematic manner. Take the survey now>>

Business Gain from How You Retain
Business Gain from How You Retain looks to identify what deepens, solidifies and perpetuates customer relationships. Specifically, the campaign looks at ways to improve the return on customer equity and lifetime value by making customer insight, understanding and intimacy a hallmark of the organization. This will evaluate marketing's growing role in seeking to anticipate and predict customer wants, needs and requirements across the lifecycle, based on the utilization of growing sources and volumes of data (transactional, behavioral, directional) generated from both inside and outside the enterprise. Share your insights into customer churn and best practices in retention marketing. Take the survey now>>

MARKETING ALIGNMENT: GROWTH DRIVER

The pressure for growth is unrelenting. The results that were generated last quarter matter little. It’s about driving earnings today and tomorrow.

CMO’s, who are focused on marketing alignment (i.e., aligning resources to business drivers), are helping their organization deliver sustainable growth. They know that it’s not about looking backward and inward to spin last quarter’s results. It’s about looking forward and outward. It’s about providing granularity to the corporate strategy. That means knowing the source of future earnings. That means having answers to questions about where the company is going to compete (or not compete) and how the company is going to win. That means building organizational capability and infrastructure to make sure expectations are met. Successful CMO’s help their organizations across all levels of the marketing strategy cascade (Figure 1).

Figure 1. Marketing Strategy Cascade

The alignment challenges are:

• Strategic alignment: Aligning marketing resources to corporate strategy.
• Shareholder alignment: Aligning the enterprise marketing process to its customers’ desired outcome.
• Organizational alignment: Aligning various groups, each with their own paradigm, to the business value drivers.

These challenges are universal. Today's CMO executives possess an intuitive sense of what needs to be done in their organization. Such executives are not looking for a framework to tell them what to do. However, they do want a framework to help them ensure they are not missing anything.

Strategic Alignment

One challenge is strategic alignment. At the end of the day, it’s about putting the company’s scarce resources to highest-and-best use. In Marketing, many activities can be performed to simply add value. However, the real challenge is to harness all of the organization’s resources in order to advance the corporate strategy.

In any case, the essence of strategic alignment is concentration of resources in an area of opportunity, which is defined by the corporate strategy. The basic challenge is deconstructing the corporate strategy into its component parts—and creating focus on the handful of things that the organization needs to do extremely well to succeed.

Shareholder Alignment

A second challenge is shareholder alignment. CMO’s, who help their CEO’s deliver, articulate marketing’s role in driving company value (see Figure 2).

Figure 2. Earning Strategies

An important customer of the enterprise marketing process is the company owner. Owners want valuation to increase. Company value (e.g., share price) is based on expectations of future earnings. The primary earnings drivers, that the company can influence, are owned by the CMO (Figure 2). The basic challenge of shareholder alignment is identifying the enterprise marketing function that will best move the needle on company value.

Organization Alignment

A third challenge is organizational alignment. The enterprise marketing function is not synonymous with the marketing department. The enterprise marketing function spans business units and departments (Figure 3). In other words, the company is not organized according to the drivers of future earnings. The company is organized for economies of scale and minimization of conflict. The basic challenge of organization alignment is creating alignment among individuals and groups with different paradigms.

Figure 3. Enterprise Marketing Functions

Alignment Success Factors

Keys for overcoming these challenges include:

1. Plan revenue by both market segment and product over minimum three-year horizon.
2. Keep a balanced perspective across the six elements of the marketing strategy cascade (Figure 1). At times, certain elements will demand more or less attention. The key is to not to let any element become a blindspot.
3. Within each element of the marketing strategy cascade, focus on aligning the enterprise marketing functions. Figure 4 provides a framework for identifying areas that will best drive value, in an organization, at a point in time.

Figure 4. Enterprise Marketing Alignment

Figure 4 outlines 25 areas that require alignment in an organization. Certainly, performing each of these activities well is important. However, the purpose of Figure 4 is simply to help CMO’s think about what areas require more or less attention.

Marketing Alignment Process

In today’s constantly evolving environment, marketing alignment has become an ongoing effort. The steps involved in are:

1. Mobilize: Develop and sell the business case for the market alignment initiative.
2. Operationalize: Identify the winnable outcomes and metrics for success.
3. Align: Execute the initiative to deliver the expected results.
4. Assign: Link success metrics to individuals’ performance objectives.
5. Monitor: Measure progress going forward.

Alignment Outcomes

The marketing function is the primary driver of earnings growth. As companies grow, earnings expectations continue to increase. Amidst these increasing expectations:

• Growth through operations improvements becomes more difficult.
• Customer expectations rapidly evolve.
• Competition comes from many directions.
• Product lifecycles accelerate.
• More programs and initiatives are implemented.
• Intangible assets become increasingly important.

All of this adds up to the need for continuously aligning the enterprise marketing function. Alignment is about focusing the organization's resources on the handful of things that need to be done extremely well to win. Is anything more important than putting resources to highest-and-best use?

CREATING BRAND CONNECTIONS

Effective marketing starts conversations with target audiences including employees, customers and prospects. For a conversation to be vital or even viable, it must provide value in both directions. Sitting through one evening of television advertising is still a painful reminder of the gap between the manufacturer view and that of the customer they are trying to attract. Advertising winds up being a one sided presentation of orchestrated arguments that hold very little water compared to one sentence from the mouth of an astute employee.

The Age of Consumer Control

Today most brand conversations are taking place well outside the watchful eye of brand managers and their ad agencies. Many of the most important discussions are happening informally every day; at work, at parties, in groups and on the web - outside the purview of those who seek to control the dialogue. Only by relinquishing some degree of control can brand holders capitalize on the most important medium: word of mouth. These conversations are authentic, they are credible, and they are not even paid for. Yet they provide the most important support for a brand any business could ask for. New technologies and the web provide a powerful way to encourage conversation and advocacy using effective tactics and with integrity.

It is often said that we are now in the age of ‘customer control’, when people can find just about anything they want and buy it where they want and often at the price they want. The true purpose of marketing in this new environment is to go beyond the limitations of one-way media to create dialogues between brands and customers, and among consumers about brands.

Building Brand Relationships

Personal connections are not a calculated decision for most of us. We establish relationships when we feel connected. These connections are the result of a balanced perception of pros, cons and a healthy dose of emotion. The same can be said about the relationship between people and brands. Numerous studies have determined that people don’t actually make any buying decisions on purely intellectual terms. Every decision we make, whether about personal relationships, a footwear purchase, or a business partner combines both rational and emotional considerations…"What do I THINK about this?"..."Do I BELIEVE it’s the right choice?" …"How will I ACT in the future?..."

The Limits of Integrated Marketing

Combining traditional one-way marketing tactics with new media, sales promotion or non-traditional approaches to deliver an integrated marketing program is a good start, but it is no longer the best way to build brand relationships. That requires marketing and communication that is connective by linking a brand’s internal messages from its internal brand ambassadors to all relevant partner and customer experiences, and providing a deeper connection with each touchpoint.

The tenure of a typical CMO is now down to approximately 21 months, so a new marketing team has less than two years to conduct research, assemble a strategy, develop the big ideas, execute the programs and deliver results (read: sales lift). A tall order by any measure that is now made even more complicated by the massive shift from the comfortable confines of traditional mass media to the new realities of one-to-one marketing. At the same time as tenures are shrinking, the options for reaching customers and prospects is growing dramatically leaving less time than ever to choose and test the myriad of tactical options.

Whatever name you care to give to the current collection of new-marketing phenomenon, one to one, experiential, word-of-mouth, integrated, relationship, dialogue, niche, guerrilla, street, personal, holistic, customer-centric, interactive, direct, social, community, viral, etc, etc, etc, it all comes down to one simple objective: the need to connect more meaningfully with our most valued prospects and customers for a longer period of time.

Connective Marketing and Communications

This new marketing approach – the Connective Model ‑ is more closely aligned with what brands genuinely need to attract prospects and deepen audience relationships through a connected web of tactics that is additive and not redundant.

The holy grail of virtually all client initiatives is to create relationships between the brand and its audiences. These are diverse internal and business audiences and include employees, investors, partners, franchisees, and channels. Connective Marketing and Communications optimizes an organization’s full marketing and communications spend by analyzing, creating, leveraging, extending and connecting their existing marketing and communications assets to create relevant and results-driven dialogue with key internal and external audiences.

• It starts branding from the inside-out, building brand champions and passionate ambassadors out of employees, sales executives, and the management team.
• It allows organizations to build solutions from a media neutral position, driven by customer centric needs.
• It creates a stronger and more fully interactive and longer-lived dialogue between brand and key audiences.
• It takes into account the marketing and messaging investments already made, and rather than ignoring or attempting to displace them, adds to or leverages them, to take full advantage of any positive communications equity a brand has had.
• It is a way to deal with the message integration dilemma. In almost all cases brands have multiple agencies at work on different pieces of the total marketing program. These agencies are understandably territorial and invested in their own ideas. Despite the clear need and bottom-line advantages, reaching an integrated message and solution for the brand often seems an insurmountable challenge.
• By deploying the Connective Model (see chart) there is an opportunity to develop new ideas that build on previous marketing investments, and provide links in all the customer (and internal audience) touchpoints that provide harmony where there is currently dissonance among multiple creative agency partners.

Connective Marketing and Communications requires looking beyond a particular campaign or media silo, to all of the brand's assets in order to link them all with new connections and live experiences so that all assets work harder and more effectively. Real success comes when the connected results create a journey that inspires key audiences to engage in a conversation and begin a relationship. This conversation can be measured by success at point-of-sale, improved internal productivity and genuine business results. The result is a better dialogue between your brand and your audiences, and between your audiences about your brand.

CMOs IN PERIL

From my vantage point as a former marketing executive and current head of nFusion working with dozens of different client companies, I see two types of CMOs. The first, which I’ll call Type A, is the one in most peril. The second, Type B is, unfortunately, a rarity.

The Type A CMO

Here’s the situation in which many Type A CMOs find themselves. A company has several business units with P&L responsibility, predominantly based around different product types. It has offices around the globe in order to serve international markets, each with its own shadow P&L. This structure leads to the delivery of an array of messages to the market, varying both by product category and geography. At some point the CEO decides that “we need a coherent brand strategy” and appoints a CMO to work across all business units and geographies to unify the company’s voice. The new CMO promptly hires a big name advertising agency to develop a unifying campaign and a catchy tag line. Several marketing operations are centralized in the CMO’s office, the new “brand mission” is rolled out and the executive team feels good that progress is being made. Eighteen months later, business results have not improved significantly, the business units and geographies are frustrated by lack of marketing accountability and the CMO is hung out to dry. The search for a new CMO then begins.

The problem as I see it is that the Type A CMO’s charter was insufficient. The company was trying to solve its business performance issues through brand advertising. Not surprisingly, that only had a short-term impact on morale and little long-term impact on results. What’s really needed is a different charter and a Type B CMO.

The Type B CMO

The first action of a Type B CMO is to architect a competitively-advantaged business model. This takes a unique person who can involve the product leaders, the operations leaders and the CFO in developing a sound corporate strategy. Where can the company win? How can it attract and retain customers better than competitors? What products and services are needed to deliver this strategy? What pricing strategy is optimal? What operational model is needed to support this strategy and to make money? These are critical issues that the Type A CMO doesn’t address and are the issues central to business performance. Once the winning business model has been defined, then the CMO can proceed to the second step, developing brand communications that reinforce the model.

However, a Type B CMO will not stop there. He or she will devise an organizational approach to executing a third step, which is a comprehensive portfolio of customer engagement programs. This is where marketing effectiveness happens, where new customers are invited into a relationship and current customers actively participate in a dialogue with the company. These are the programs that deliver sales results and that are adaptable to the value propositions of each product line and uniqueness of each geography. They embrace interaction across all media, especially the digital world, where customers are spending much of their time. They are measurable and accountable to the business unit needs. They are the lifeblood of a successful organization.

The good news for imperiled CMOs is that they can extend their value and their tenures if they become Type B CMOs. At least that’s how I see it. What’s your perspective? Join this discussion and see what others have to say at http://www.nfusion.com/press/peril-for-cmos.

BRAND ENGAGEMENT 2.0

Employees are no longer an afterthought – when it comes to branding, that is.

Thankfully, company leaders have learned the importance of engaging their employees with their brand. CEO’s and CMO’s have come to realize an if-we-build-it-they-will-come approach is ineffective in getting employees to embrace the brand positioning. And with many employees acting in critical brand delivery roles, leaders cannot ignore the importance of brand engagement. So now companies include their employees in brand roll-out plans and incorporate brand values into new employee orientations.

JetBlue employs a variety of means to convey its brand idea to its employees, including BluePrint (the company’s mission statement, used as a preamble in all internal publications), BlueBook (a comprehensive manual covering company philosophy and expectations), and BlueNotes (a regular newsletter for news and extra information.) Service training sessions were conducted worldwide by Intercontinental Hotel to reach its 40,000 employees when it launched its brand re-positioning. And Ann Hand, marketing head at BP, had internal stakeholders in mind when developing the company’s new ads. She explains, “We are really using the advertising to inspire the people who work at our sites to want to give better service.”

While these efforts are to be applauded, they are subject to the same challenges experienced by marketers using traditional media to connect with customers. Attention spans have become shorter and in-boxes have become fuller while expectations of being entertained have become greater – among consumers and employees alike.

Technology has transformed the way companies engage their customers – why not their employees? Web 2.0 enables marketers to participate in ongoing dialogues with their customers. Companies solicit ads from the public in an effort to promote different interpretations of the brand. Including brands in videogames is considered a less-intrusive, more authentic way to interact with customers.

The objectives that spawned the development of these externally-targeted methods are similar to those of internal engagement. By re-directing the innovation and fresh thinking currently applied to marketing communications, companies can take their brand engagement efforts to the next level.

Engaging employees through new technology-enabled methods can unleash their creativity and passions, spread their wealth of knowledge and experience, and uncover new perspectives which strengthen the brand. Here’s how:

Employee-generated content.
Encourage employees to create videos, collages, essays, etc. to express what the brand means to them. Or to demonstrate how they draw upon the brand values in their day-to-day work. Or to show how using the brand has transformed their work product.

Then post that employee-generated content on an intranet site so all employees can enjoy and learn from others’ expressions and examples. Comments and follow-on postings can also be solicited, stimulating a rich dialogue among employees and providing a venue for company leaders to learn their employees’ perspectives and to share their own.

By supplementing a written brand statement with this type of exchange, everyone’s understanding of the brand and its value is increased. MIT Professor Marvin Minsky explains the importance of learning from multiple perspectives: “If you only understand something one way, you don’t really understand it at all – because when something goes wrong, you’ll have nowhere to go. To ‘understand’, you need multiple ways to deal with each different aspect of things.” Web 2.0 approaches can facilitate true brand understanding.

Videogame-style decision-making simulations.
Use interactive video “games” to simulate real-life scenarios and help employees learn how to make decisions that appropriately interpret and reinforce the brand.

New product screening, co-branded program selection, and customer service delivery are examples of brand-related decisions employees make regularly. And you want to ensure these decisions are informed by brand principles and guidelines. Technology now enables us to replace rigid rules and static decision-trees with game-oriented learning experiences that are fun and multi-sensory. Friendly competitions among players can provide an additional excitement and support for the brand.

By teaching brand-supporting decision-making, demonstrating the positive outcomes of those decisions, and rewarding brand-building behavior through videogame-oriented simulations, you make brand training more entertaining and memorable. And a tool like this can be deployed easily across geographically dispersed employee populations or other situations where autonomous learning makes more sense than in-person group sessions.

Customer virtual worlds.
Create virtual worlds that enable employees to experience a day in the life of customers. There may be no better way to help a 40 year old white male employee understand an 18 year old Latina customer than to have him create an avatar of her and spend time in her world virtually.

However unlike Second Life’s make-believe brand worlds that encourage users to assume fake identities in order to indulge their fantasies, a customer virtual world enables employees to experience real customers’ lives by hanging out with the customers’ peers and being exposed to their cultural influencers. These true-to-life experiences can help people understand how and why customers make purchase decisions – their consideration set of brands, the trade-offs they must make, etc.

When employees acquire such an intuitive understanding of their customers, they know how to meet customers’ needs and serve them better. They recognize the importance of a customer experience that supports the brand positioning and the role they themselves play in developing and delivering it.

These are only three ways new technologies can transform the brand engagement process. Many more exist, I’m sure, or are waiting to be discovered.

Importantly, these approaches must not be perceived as gimmicks or ends unto themselves. Employees may be as skeptical as consumers when it comes to brand campaigns. These methods should be carefully planned within a strategic and cohesive brand development program, and carefully deployed and positioned as tools that help employees strengthen brand delivery. Only when people realize how these approaches help them and their companies be more successful will they buy into them and use them.

This is an exciting era for brands. Rife and ripe are the opportunities to engage people on a personal, rich, and meaningful level. Many companies are seizing these opportunities with consumers. Now let’s apply our creativity and capabilities to employee engagement which is just as important – if not more.

WHICH E-MAIL MARKETING SOLUTION IS RIGHT FOR YOU?

E-mail marketing has become an important and cost effective part of marketing mix to reach customers with timely and relevant messages. As email marketing has evolved, so too have a number of providers of email services and software.

According to a 2006 survey conducted by Forrester Research1 -

• 94% of marketers currently use or are planning to use email marketing by 2007.
• 58% of the marketers deliver emails through an agency, while the lion's share of the rest design and deliver email campaigns using installed software.
• Marketers are increasing their focus on integrating email with other tactics and measuring the business impact of their efforts.
• Marketers using agencies or service providers expect the fees for services from delivery to creative development to go up over time. For example, for those paying for creative services, 54% said they are expecting those fees to increase.
• The initial choice of an email vendor, changing vendors or vendor types can be daunting given the number of vendors and the number of solutions in the market. Marketers tend to change vendors or vendor type when email creation and delivery becomes too expensive or is not integrated and responsive enough for the needs of their business. This paper summarizes the key decision areas to consider when evaluating email solutions based on your business needs, your available marketing expertise and IT resources, and your needs for integration and security.

Improving Email Marketing ROI
Calculating the basic ROI form email marketing campaigns is fairly simple. You need the number of people or pieces you are emailing, the cost of the email campaign, the response rate, the conversion rate and the average profit per sale.

ROI% = Total Profit / Total Cost

Total Profit = # of Buyers x Average Profit per Sale

Total Cost = The fully loaded cost of creating and sending the email out to all the prospects or customers.

# of Buyers = # of Emails Sent x Response Rate x Conversion Rate

Tip - When looking at the fully loaded costs of email campaigns, don't forget to add in factors like the costs of creative development, content fees, delivery fees and program analysis fees from outsourced vendors or the costs of integration or internal labor to load lists of contacts or responses into internal systems.

You can improve the ROI of email marketing efforts in a number of ways:

Lower Overhead - Options for reducing overhead costs include performing functions in house and removing manual steps that require expensive personal to perform data management tasks. Moving email inhouse allows existing resources to work on email operations and perform functions like creating emails that were previously performed by more expensive outsourced vendors. Integration between campaign management systems and email systems can also reduce the overhead of manually loading data into internal systems and increase data quality.

Improve House List Quality - purchasing lists can be expensive and have mixed results. One of the best ways to increase the response rates and lower costs is to improve the quality of your in-house customer data. Systems with integrated response management including bounce management, opt-in and opt-out, help to increase the quality of your in house list and reduce list purchase costs. When email delivery is outsourced, it takes continual, diligent effort to ensure that bad email addresses are flagged or removed, and that unsubscribes are propagated to other business processes.

Improve Response & Conversion Rates - Improved response to email messages can often be accomplished with better management of email content and delivery to appeal to the target reader including -

• Segmentation - Integration with advanced segmentation tools allow for highly targeted smaller groups to be created based on a variety of data across the enterprise. These small groups can be reached with a highly targeted message which results in a higher response rate.
• Frequency Management - Managing the frequency of contact with prospects and customers makes sure they don't get overloaded and ignore an important or relevant message.
• Opt-in - Allowing customers to opt-in to receive email messages on a particular topic of interest can significantly improve their likelihood of response and follow through.
• Personalization - Creating content which appears to be custom made for an individual either by using their name in the subject line or body of the email, referencing the products they already on or only showing content sections which are relevant to their situation can greatly increase the likelihood of response. Using an in-house solution is typically the most robust environment for personalization because email content and personalization rules can pull from any number of personal details in the customer database.

Increase Profit per Sale - Increased profits are often realized by providing ample cross-sell and up-sell opportunities for prospects once they reach your website, call center or enter your retail store. If email campaigns are disconnected from other customer channels, then the opportunity to cross-sell or up-sell is often lost. For example, a customer receives and email and calls into the call center. If the call center agent has no idea what offer the customer received, not only can they not sell the product at the right discount but they cannot appropriately cross-sell or up-sell.

To download a free email marketing white paper from Oracle, click here.

THE CMO COUNCIL IS PLEASED TO WELCOME NOOZZ.COM

The CMO Council is pleased to welcome Noozz.com, a London-based provider of Middle East news and market intelligence, as a media partner. Noozz has over 60,000 unique hits per month on its website and 8,000 subscribers in business and government communities world wide. With a significant concentration in the Middle East, www.noozz.com features in depth reporting by its own journalists, it’s own quarterly market research reports as well as providing such resources as Reuters breaking news, and full EIU and BMI market research reports. Noozz now operates separate news and information portals for Bahrain, Egypt, Iraq, Kuwait, Qatar, Saudi Arabia, and United Arab Emirates and has plans to expand service to include other developing markets.

Nooz.com is offering all CMO Council members up to 25% off annual subscriptions to this information-rich portal. If you are interested in staying on top of opportunities and developments in the Middle East, we encourage you to contact Richard Ream, President of Noozz America either by email or phone: 202-470-3424 or 239-443-0853

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