Summary
- Digital marketing transformation is less about applying digital technologies and channels and more about making a shift from tactical activities to strategic business outcomes.
- It's needed when marketing leaders seek to shift from incremental advancements to order of magnitude improvements, and significantly increase marketing's revenue contribution to the company.
- Research findings show that Best-in-Class Marketers achieve transformation by focusing on a mix of 9 marketing best practices.
There's no shortage of talk about digital marketing transformation. But what's that even mean?
Well, some recent research published in the Marketing Transformation Report answered that question.
It found the Best-in-Class Marketers (i.e., the top 15 percent) achieved transformation by focusing on a combination of 9 best practices.
The research used a 55-question survey to capture marketing program effectiveness and performance results from 179 companies.
Respondents were then ranked and grouped into one of three archetypes based on their performance results.
- Best-in-Class organizations scored in the top 15%
- Median organizations scored in the middle 50%
- Laggard organizations scored in the lower 35%
Segmenting the respondents into cohorts allowed us to correlate program results by archetype. And that allows us to understand what the top marketers do differently than their lower performing peers.
The 9 Marketing Best Practices that Transform Marketing
Nine marketing programs stood far above all others in terms of driving transformative results. These 9 programs are referred to as evidence-based best practices.
Here are some of the findings.
Marketing Strategy
Reaching any destination is best done with a plan and map.
The research found that 88 percent of marketers that achieved transformative performance results started with a documented strategy.
That's not a big surprise. According to Gartner, "Marketers who develop an integrated marketing strategy will deliver a 50% higher return on marketing investment (ROMI) than those who do not."
A marketing strategy creates focus and prioritization. It's a precursor to everything that comes after. Great execution won't get you very far if your strategy is wrong.
And without strategy, execution is aimless. Without strategy, most companies incur random acts of marketing that either fail to achieve the most important business outcomes, or at best take a trial-and-error approach, and a much longer route.
A transformation effort without a solid strategy is a lot like watching a foreign language film without subtitles. A lot of activity but you have no idea where it's going.
Go-to-Market Plan
It was Mark Twain that said, "The secret of getting ahead is getting started. The secret of getting started is breaking your complex, overwhelming tasks into small manageable tasks, then starting on the first one."
That perfectly describes the second marketing best practice of using a defined Go-to-Market Plan for rigorous execution.
The Go-to-Market plan is the roadmap that plots the shortest path or most direct route to defined transformation goals.
The research found the primary difference among archetypes was not whether they created a plan, they pretty much all did.
Instead, the difference was that for most laggards and medians it was a one-and-done exercise; limited to a finished document that was thereafter shelved or occasionally referenced in quarterly reporting.
In contrast, the Best-in-Class used it as an active operating tool throughout the period to measure progress, identify deviations and implement timely course corrections as needed to meet the target goals.
Customer Intelligence
It was the late management guru Peter Drucker that said, "The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself." And the research finds that the Best-in-Class marketers put his wise words to work.
Voice of the Customer (VoC) was the primary method to gain customer intelligence.
But customer intelligence methods varied widely. The below chart shows how four methods were adopted among respondents.
And as the bottom portion shows, while only 19 percent of survey participants actively used all four customer intelligence methods, those adopters achieved significantly higher performance results compared to all others.
Brand Management
The survey questions focused on brand management research found marketers with active brand management programs delivered 18 percent more leads to the salesforce, 21 percent higher contribution to the sales pipeline, and 21 percent greater marketing ROI than marketers without active branding programs.
But these impressive results are missed by most marketers.
The research also found that only 39 percent of survey participants engaged in active brand management.
Revenue Engineering
Transformation shifts marketing from a support organization to one of the company's two primary revenue contributors.
And the most used method by the Best-in-Class to drive marketing-sourced revenue contribution was Revenue Engineering.
This is a predictive model that depicts the company's revenue progression in a Lead-to-Revenue funnel. It shows the sales stages, conversions and velocity for all leads as they traverse the sales cycle. It displays real-time revenue visibility and date-based predictability.
The research found one difference among marketing archetypes that stood above all others. An average of 22 percent of all marketers use a revenue engineering model. But that figure is heavily skewed by archetype. Adoption by the Best-in-Class marketers was 90 percent. That's a whopping 5X higher adoption when compared to lower performing peers.
And when we compared adoption to key performance measures we found similar patterns.
The participants that applied revenue engineering outperformed those who did not by more than 2X in all three measures.
Campaign Optimization
The salesforce is one of marketing's most important customers and their top request is qualified sales leads.
That's why marketing campaigns are essential. To increase sales lead volume, you must increase marketing campaign effectiveness.
While the research survey set out to find the highest performing types of campaigns, we ended up finding something else.
The research found the most effective marketing campaign was not a particular type of campaign but an integrated mix of multiple types.
Marketing campaigns built on an orchestrated combination of multiple campaign types that were aligned, sequenced and delivered across multiple channels achieved the highest volume and quality of sales leads.
Lead Management
The goal of lead management is to convert leads into sale opportunities. For many marketers, this means converting leads into Sales Qualified Leads (SQLs).
Lead management consists of up to eight integrated processes that include lead acquisition, lead scoring, lead enrichment, lead qualification, lead nurture programs, lead transfer to sales, lead governance (i.e., SLA) and lead analytics.
The portion of the survey dedicated to lead management research found that while only 14 percent of respondents performed seven or more integrated lead management processes, those marketers earned an impressive 211 percent ROI.
As shown in the below chart, that's a significantly higher payback compared to peers.
Marketing Analytics
Analytics bring metrics and measurements to the prior best practices.
The marketing reporting research found that use of information reporting tools varied significantly. For example, 84 percent of the Best-in-Class marketers regularly used predictive analytics, which was 67 percent higher than their lower performing peers.
And 90 percent of the Best-in-Class regularly used artificial intelligence (AI), which was 43 percent higher than their lower performing peers.
When paired, predictive analytics and AI are surprisingly accurate, and getting better every day as they digest more data. We can see examples of this in our daily lives.
Amazon is highly accurate in recommending what offers and products consumers want next. Netflix is highly accurate in suggesting which shows its viewers will like next. My pet food supplier knows when I'm about to run out of cat and dog food and my HVAC supplier knows when my air filters need to be changed.
Marketing Technologies
When reviewing marketing technologies, the research surfaced some unexpected results.
It found that most marketing applications were rated as both effective and ineffective by large numbers of participants. The MarTech with the highest scores also had large numbers of low scores and vice versa.
The data suggested that what separated the most and least effective marketing technologies was less about the actual technologies and more about how they were designed and implemented.
We filtered the data to view the top five marketing technologies ranked by the Best-in-Class marketers.
But even this didn't tell the whole story. For example, while marketing automation platform (MAP) software has become pervasive, the research found that among most respondents it is dramatically underused.
For example, most respondents used only 1 lead scoring rule and only one nurture campaign. Approximately half of all respondents used MAP software to create landing pages and perform email distributions, which accounts for about 10 percent of the technology’s capability. This again suggests that effectiveness is less about the type of technology and more about how it is designed and deployed.
Research shows that most Marketing Automation Platforms (MAP) are significantly underutilized by marketers.
Click to TweetOne More Thing. Participation is not Dedication.
Most respondents indicated they adopted all or most of the 9 evidence-based best practices.
However, there is a big difference between adoption which is often a casual participation and dedication which creates expertise.
Dedication requires programs with executive sponsorship, focused resources, enabling technology, performance analytics and continuous process improvements. Dedication goes from being a generalist to becoming a specialist.
And when the criteria for dedicated programs are considered, only the Best-in-Class engaged in 7 or more, on average, of the best practices.
The evidence-based best practices can be applied individually to deliver incremental improvements. However, an integrated mix of best practices is needed to achieve marketing transformation.
To advance from incremental to exponential business outcomes, consider your current performance in these nine areas, and identify the biggest uplift opportunities.