Adding Method to the Madness- Tools for Marketing come of age

After decades of holding back while other corporate
functions took the technology plunge, marketing is
getting its odd ducks in a row.

BY SARI KALIN

THE COMBINATION OF business process automation and marketing might seem like an oxymoron. After all,
aren’t marketers the people who play with Legos and Toobers and Zots (oh, my!) to find elusive inspiration for
such catchphrases as "Whazzzup!" and "Zoom, zoom, zoom"? Don’t they fancy themselves the artistes of the
marketplace—concept creators who can ignite a customer’s hitherto unknown desire for, say, that daily dosage of
powdered fiber or the latest in relief from the heartbreak of static cling? Given the magically creative mission of
the marketing arts, what remains of the process that could possibly need to be automated (besides, of course,
putting the Thai takeout place on the marketing assistant’s speed dial)?

Quite a bit, it turns out. A growing cadre of software vendors believe that marketers engage in complex business
processes that cry out for automation. These vendors aspire to take the chaos out of creativity—to bring the same
kind of integrated planning, budgeting, workflow and measurement rigor to the marketing department that you’d
find in finance or manufacturing. Of course, a cynic might say that vendors can always find a new way for
corporations to spend hundreds of thousands of dollars on the latest software marvel. But, perhaps astoundingly,
marketing is the last corner of the corporation to have escaped the improving efficiencies of a unifying
technology platform. And when marketing giants such as Procter & Gamble (P&G) and Coca-Cola start looking
at a new breed of software geared to bring rigor to their diverse activities, that in itself is a sign that the
technology is worthy of broader attention.

Still, the category is so new that vendors and industry
analysts have yet to settle on a name for it. Some of the
christening options are marketing resource management
(MRM, which we will be using throughout this article),
marketing process management (MPM) and enterprise
marketing management (EMM). Whatever you call it, the
software is far from being mainstream today. But by
2005, according to Gartner, the Stamford, Conn.-based
analyst firm, more than 30 percent of Global 1000
companies will be using MRM software, at least at the
business unit or geographical division level.

To understand why marketers need MRM, you ought to
feel a bit of their pain (that might be hard if you’re not the
sensitive, creative sort, but just play along for now).
Marketers control gobs of money. Depending on the
industry, companies spend the equivalent of 15 percent
to 35 percent of their revenues on marketing, Gartner
estimates—far more than they spend on IT (and, for
some consumer goods manufacturers, more than they
spend making the product). Much of that money is spent
on salaries for employees who leave the company for a
new job and take their knowledge with them (oh, the
waste); on projects that require many mundane manual
tasks (blizzards of e-mail to confirm status, get approval,
check deadlines) that drain time and energy from more
creative work; and on the sorts of marketing activities
whose lack of rigorously measurable effectiveness gives
bouts of indigestion to CFOs everywhere.

In short, MRM could help to boost marketing’s
accountability and efficiency, and maybe even stop it
from being the first line item slashed whenever times get
tight.

Moreover, marketing is evolving to become much more
complex: more global, more fragmented, more dependent
on outsourcers, and more in need of ways to standardize and automate the day-to-day
routines that underlie its creative feats. For example, at Indianapolis-based Delta Faucet,
marketing serves two major brands comprising hundreds of different product lines sold in
53 countries. Each new product goes through seven separate stages in the course of its
development. There’s a lot that marketing needs to get its arms around. "Innovation is a
process," says Ray Kennedy, vice president of marketing at Delta. "It isn’t something that
just happens."

Still, adding an orderly layer of process to marketing poses an interesting cultural
challenge. It’s not exactly easy to get workers who thrive on loosey-goosey ways to accept
a bit of goose stepping. But MRM pioneers like Delta Faucet are
starting to try. And Cincinnati-based consumer products
colossus Procter & Gamble is so convinced of MRM’s promise
that it is already rolling out an MRM system across some of its
global brands. In fact, P&G entered into a joint venture last year
with Cupertino, Calif.-based Worldwide Magnifi, an online
marketing services provider, and BrandCities, a San
Francisco-based online marketing company that specializes in
desktop tools. Together they formed an MRM vendor called
Emmperative. (P&G ponied up more than just cash: Emmperative has a perpetual license
to P&G’s marketing know-how, so it can use the consumer packaged goods giant’s
business processes to enrich its product offering.) Other companies taking the MRM
plunge include Compaq Computer (in North America), Foote, Cone & Belding Worldwide
(the 10th-largest ad agency in the world and part of the Interpublic Group) and Phillips’
Domestic Appliances Division.

So, just because marketers are the butt of many Dilbert jokes, don’t assume it’s safe to
ignore MRM software. Investigate MRM’s potential for your company—the problems it can
solve, the hurdles you’ll face if you decide to deploy it and the ROI you can expect to
achieve over what time period.

Marketing’s Big Problem
It’s not that the marketing function hasn’t been using technology of any kind. Marketers
use e-mail, spreadsheets, online calendars, even basic project-management software to
help them do their job more efficiently. They also tap
software designed to handle specific marketing
tasks—among them direct mail, campaign management,
e-mail marketing, digital asset management and
customer data analysis. The problem is that in large
companies with multiple brands, product lines and
customer constituencies, different marketing groups may
use different software packages that cannot talk to each
other. Forget about trying to get a single view of all things
marketing-related across an entire company—or even
across a single geography or marketing activity. "If you
asked me, ‘How many events do we have going on in
North America this quarter?’ I might have to call 15
different people," says Patrick Deyo, operations manager
for North America integrated marketing communications
at Compaq’s enterprise organization, which began its
MRM rollout last year.

Added to this lack of integration among the pieces of
marketing’s application portfolio is a persistent drain of
institutional memory. Thanks to high turnover, marketers
have perfected the costly art of reinventing the wheel. The
problem is writ large at global giants like P&G, which
sells more than 250 brands across 130 countries. If a
brand manager has come up with a great way to launch
Febreze fabric spray in Australia, there’s no easy way for
his counterpart in Austria to find out about it. "We have
very bright marketing people who have success stories
developing throughout the world, but we lack a systematic
way of sharing and reapplying their thinking quickly," says
Jim Stengel, P&G’s Cincinnati-based global marketing
officer.

Sharing success stories is only part of the problem. Try
sharing market-research data—you know, the red-hot
facts and figures that marketers crave, which take months
to gather and usually wind up stuck in a three-ring binder where no one can find them.

"Ironically, despite all the data we generate as a company or within a specific global brand,
we find ourselves sometimes making decisions based on incomplete data because the
data isn’t where we need it, when we need it," Stengel says. "This results in significant
operating inefficiencies." Today’s economy leaves no room for such inefficiencies.

MRM’s Big Promise
Now imagine a single software package with the goal of helping a vice president of
marketing do strategic planning for all marketing activities—research, advertising, direct
mail, events. The software would have a window into every marketing project, tracking its
status and its budget in real-time. It would promise a
personalized desktop, showing every marketing employee (and
those outside of marketing who interact with them) what they
need to do and when. It would act as a traffic cop, making sure
that marketing minions know where to route their brochure
copy next or who needs to sign off on a project. It would be a
knowledge manager, serving up case studies of the most
successful holiday ad campaigns or best practices for
organizing an event in Brazil. It would be an online librarian,
storing the most up-to-date logos and product photos so all the
relevant players have access to them (including outside
contractors and advertising agencies). Perhaps most
important, it would be an analyst, gathering and crunching data
from front-office and back-office systems to gauge the success
of marketing programs and their impact on the business. And it
would be accessible over the Internet, so that anyone involved in a project inside the
company (and trusted outsiders) could use it from anywhere and at any time.

That’s the vision of MRM software—that it will connect everything and everyone
marketing-related, in much the same way as enterprise resource planning (ERP) systems
connect the back office, and manufacturing resource planning (MRP) systems connect the
plant. But that vision is not a reality quite yet, says Claudio Marcus, a research director at
Gartner. Yes, vendors now offer browser-based software directed squarely at the marketing
function; and it can be used by both in-house people and outside contractors. But "today,
these vendors are primarily focused around marketing project management and marketing
content management," Marcus says, and what software there is has yet to be widely
deployed. Missing from many of these software packages is the ability to do strategic
planning (and to make plan adjustments on the fly, in response to changes in the
competitive environment) and to measure the business impact of marketing initiatives.
"Some vendors say, ‘Yes, you can do measurement,’ but you have to do customization
and integration," he says (without integration to customer relationship management,
enterprise resource planning and legacy systems, there’s no way to get a handle on
marketing’s true costs and results). "It’s not very easily accomplished." Two
vendors—Aprimo and Emmperative—stand out because they offer more comprehensive
software packages, Marcus says, "but it’s a bit early to make a final call."

Investing in any new type of software is a risk; no one wants to get stuck using a
less-than-ideal technology from a vendor that won’t survive long enough to roll out its next
major revision. Yet Marcus believes that MRM is a risk worth taking for large companies
with complex marketing activities—as long as they look at the software with a short-term
ROI in mind. "There are significant needs within organizations and a lot of advantages to
beginning to use these kinds of applications," Marcus says. "Look at this as something
that you’re going to need to get an ROI on in 12 to 18 months. Then, in 12 to 18 months,
do a reassessment of the marketplace and look for a larger fit." Over the next year, Marcus
expects to see CRM and marketing automation vendors edging into the MRM space.

How to Zoom, Zoom, Zoom
The vendors aren’t all that stands in the way of achieving the ne plus ultra of an MRM
rollout. Marketers themselves can be the biggest obstacle. Sometimes there’s resistance
from the top, says Kevin Scott, a research analyst specializing in marketing strategies at
AMR Research in Boston. "The argument you get from a VP of marketing is, ‘My budget is
always being cut, I’m losing people left and right, I’ve got lots of turnover. Why would I want
to bring in software to make me more efficient and lose more people?’" Scott says. But the
argument doesn’t hold up, he believes. In fact, MRM could actually help marketers make
the case for why they need to keep their people and their budgets. By quantifying what has
traditionally been unmeasurable, marketers can show CEOs the value they’re producing.
"Show [them] you’re blowing out your plan, and you’re going to get more [budget] down the
road," says Scott.

Once the senior execs get sold on MRM and settle on a vendor (for a list of the main
marketing resource management players, see http://www.darwinmag.com/printlinks), the
marketing group—and their cohorts in other departments—must agree on and codify
business processes that everyone will use.

Don’t underestimate just how devilish it can be to gain consensus on those details, says
Deyo. "We all agree that apple pie and ice cream is great," Deyo says. "When you get to
what type of ice cream, I like Breyer’s, you like Ben & Jerry’s,"
and the debate goes on from there. Deyo gives an example from
the direct-marketing group: Everyone agreed that direct
marketers needed to have a more structured way to request a
slice of names from Compaq’s customer database. (The old
method—asking the database group, "Can you get me all the IT
professionals who are planning to buy storage solutions in
2002?"—would typically require a lot of back-and-forth questioning and rework, hardly the
best way to generate a good direct-marketing list.) Everyone agreed that the program
request form—a Web-based form with a series of required fields that marketers would need
to fill out—should include the size of the audience and the products that the campaign
would target. But did it always have to list the program’s objectives? Identify a project
owner? Specify the source of funding?

"By working on the 20 percent of our differences, we improved a lot of different processes,"
Deyo says.

When the MRM system is finally up and running, the next challenge is to convince the
company’s mass of marketing minions to use it. P&G’s Stengel says the only way to get
marketers to change their ways is to spell out the compelling business need for and
benefits from MRM. "This is what P&G knows how to do very well with consumers of our
brands," Stengel says. "Our intent is to use many of the same marketing principles and
tools on ourselves, to change our work habits and practices, as we roll out the [MRM]
platform on a brand-by-brand basis." No, P&G isn’t planning to come up with a cute jingle.
But "as with any sound marketing strategy, we are first committed to understanding the
audience," Stengel says. Within each brand or business
unit, P&G is figuring out which of its top-gun marketers
are most likely to be early MRM users—and which will
use MRM to its full advantage. P&G will then take "user
insights we gather from those leaders and develop key
messages and a strategy for communicating benefits to
the rest of the team," Stengel says. " By harnessing
experiences of early adopters, we hope to give others a
reason to believe the platform can deliver on its stated
benefits."

At Compaq, Karen Davis, vice president of enterprise
marketing and communications for North America, has
been carrying the torch for MRM acceptance. Davis made
sure that the team overseeing the rollout included people
who would ultimately be using the software. The team
built support by picking a sure-win pilot project: a unified
online calendar for Compaq’s events group (previously,
there were seven different calendar systems used in North
America alone). It’s better to start with a small project that
can deliver benefits quickly (it took just 30 business days
to go from concept to rollout in converting the first
calendar to the standard system), says Davis, "rather
than biting off world hunger and trying to wait until
everything is perfect before you roll it out. I believe in the
incremental improvement model. Then you create
advocates who can help bring other people on board."

Deyo took easily to MRM. He came to marketing from
manufacturing, "the MRP master scheduling world."
There, he says, "we drove the whole business based on
an integrated architecture." Because MRM was like an
MRP system for marketing, Deyo eagerly embraced it.
"This takes a total campaign approach and breaks down
the campaign into its elements without losing focus on
the finished product, which is the campaign. You end up
with common messaging, common plans, common
people." But not all of Deyo’s coworkers were quite so
comfortable with the shift. "Everybody looks at you and
says, ‘I’ve been doing it this way for years, why do I need
that technology?’" Deyo says. "It’s a totally different environment."

It took Compaq nine months to get what Deyo calls a critical mass of users (80 percent of
Compaq’s marketing groups actively performing one or more processes via the MRM
system). As of the first quarter of this year, the company was managing 500 live marketing
activities—everything from planning an ad campaign to pulling a direct-marketing
list—through its MRM software.

That’s a pretty good rate of progress, Deyo says, when you think about the complexity of
Compaq’s rollout: The company is trying to harmonize marcom practices across multiple
corporate cultures (Compaq, Digital, Tandem and, perhaps, Hewlett-Packard), multiple
geographic locations and multiple business units.

"If I was starting a new house, I’d dig the foundation, then put the house up," he says.
"Imagine if you’ve got to tear down the old house and rebuild it while people are living in it."
(And all this during the worst technology market slump in more than a decade.) Much like
a house renovation, Deyo says, the MRM implementation grows as Compaq finds more
opportunities for cross-company efficiency and standardization. "We’re not done," he says.
"We’ll never be done."

Measuring the Payoff
Today, MRM software is pricey enough that its early adopters will most likely be at Fortune
1000 companies (though some vendors offer hosting arrangements that could be attractive
to midsize companies or divisions of larger companies). A midrange deployment of
Aprimo’s software, for example, might run around $100,000; a Fortune 500 company rolling
out Emmperative, by contrast, should expect to spend between $1 million and $2 million,
depending on how many people will use the software and the level of functionality they’ll
require.

Companies that use MRM software plan to gauge their ROI
through a mix of hard and soft measures. At P&G, Stengel
hopes the software will make marketers’ day-to-day work
more satisfying, because they will be able to "focus on
creative, results-oriented marketing rather than
time-consuming administrative tasks," he says. Stengel also
sees the software becoming a catalyst for "significant cultural
change" in P&G’s marketing community by helping users
create stronger marketing plans, make decisions that are
based more on data than on gut instinct and reuse tactics
that have proved successful elsewhere in the company. P&G
is also increasingly using the Internet for routine marketing
research, since it offers a faster and cheaper way to test
consumer opinion (as these initiatives are rolled out, they are
being linked to the Emmperative system). Hard ROI
measures will be evaluated according to business-unit and
brand-specific goals; managers will identify specific problems
before each rollout, and then measure how successfully the
problems are addressed.

At Compaq, meanwhile, if you ask Deyo what kinds of benefits he’s reaping from MRM,
he’ll tell you about the time Davis needed to cut her budget, and she sent him an e-mail
asking for the status of all direct-marketing projects throughout North America. He ran a
report across multiple product lines and disciplines on 47 campaigns—which ones had
started, which had yet to launch, how much money they had spent or were due to spend.
And he did it in just four minutes. Without the MRM system, Deyo says, "it would have
taken days."

The big payoff will come when Compaq’s rollout progresses enough that it can use MRM to
measure the effectiveness of its marketing campaigns, Davis says. "What marketers care
about is measuring. We do that in different but separate areas today. The goal will be to
bring it together and be able to measure [ROI] end to end when we do a campaign," she
says.

Davis hopes that being able to measure marketing effectiveness by analyzing specific
initiatives—not after they’re history but while they’re still unfolding—will deliver a much more
elusive ROI: raising the esteem of marketing within Compaq. "Oftentimes marketing is
perceived as maybe not always having a value," Davis says. "But when I look at companies
that are very marketing-driven and marketing-centric, this is the way they run marketing.
It’s a business asset. It’s a dial on the dashboard, just like sales, just like manufacturing
and other operational functions. That’s what we want to be perceived as providing, and this
will help us get there."

Five Tips for Learning to Love MRM Process Change

1. Prepare to sell. Marketing executives
may worry that their budgets will be
threatened by the efficiencies of marketing
resource management (MRM); worker bees
may fear technology will sap their
creativity. It takes a committed, persuasive
project champion to win over both groups.

2. Don’t climb every mountain. You’ll
stand a better chance of proving the value
of MRM if you start with a fast,
no-chance-for-failure project; Compaq was
able to get its events group on a unified
online calendar system in just 30 business
days.

3. Be mindful of the minutiae. One of the
toughest parts of an MRM implementation
is getting everyone involved to agree on
the finer details of a myriad of business
processes. Use the standardization debate
as a chance to improve those processes.

4. Prepare for a market shake-up. During the next 18 months, new vendors will enter the MRM fray; no doubt, there
will be a few casualties along the way. Gartner advises customers to write contracts that protect them in case their
software provider goes bust.

5. Seek a short-term ROI. Since MRM vendors will offer enhanced functionality during the next 18 months, aim for a
quick payback on whatever you roll out today (you won’t feel so bad if you have to switch vendors later on).

—Sari Kalin

Senior Editor Sari Kalin yearns for a writing process management system (WPMS) but
fears the market is too small to attract a high-quality vendor. She can be reached at
[email protected].

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