People working in marketing and communications have long understood that good results require more than just good luck. As a leader in these functions, if you’re failing to call the ball and be predictive about outcomes and impacts, you are behind the curve and your executives will see it. There may be something else you could invest in that yields more return – the opportunity cost of marketing and communications investment -- and you don’t want to make the wrong choice.
Business leaders have continued to become more demanding of marketing and communications leaders in terms of three key questions:
In addition, it’s not just a matter of reporting results, though that is important. The accuracy of predictions is equally critical. Falling short of predictions is bad of course, but regularly blowing goals out of the water indicates you are either sandbagging metrics or, even worse, just getting lucky and perpetuating that misperception. Precision – informed by data – is a major barometer of your real and perceived success.
Managing Organizations Like Investment Funds
Think about it in this way: If you’re an investor, you want more than just a report on what’s happened to your money. By the time you get that report, it’s too late to act on it to maximize returns or limit the damage. The best investment advisors – at least the ones I want advising me – are the ones who most accurately predict performance. Similarly, if you’re a CEO or CFO, you want to know where to make your bets to maximize value and sales. Marketing and communications operations should aim to improve and accelerate the three legs of sales productivity, which are direct precursors to revenue, margin and cash flow at the top of the company.
So how do we make this happen? At BMC Software, where I lead the global communications and influencer marketing efforts, we rely on a measurement and analytics platform called the Influence Scoring System (ISS), which delivers tactical, operational and strategic outputs that we use to calibrate our communications investments, effectively enabling us to run our organizations like investment funds.
Organizations need to use data to govern marketing and sales plays and leverage it to limit opportunity cost. ISS goes beyond the traditional view back in the rearview mirror to show what’s ahead – and not just what’s in front of you but also what happens if you turn left or right or step on the gas pedal or the brake.
ISS even takes into account how results affected by environmental conditions. To stick with the driving analogy, rain, snow or sunshine will change a driver’s ability to get to his or destination, and those kinds of factors impact marketing and comms results, too. We leverage macroeconomic data with company performance data to create a 1-5 Environmental Difficulty Index. That number represents the relative difficulty of selling the company’s messages to the market, and it gets factored in when calculating scores, i.e. your miles-per-gallon will be worse going uphill in snow than on a flat, dry road. Here’s the car analogy expanded as a high-level roll-up of ISS and EDI:
ISS was first born in 2004, and I’ve continued to develop it with a lot of individual and agency collaboration along the way. The first version was completely Excel-based and very primitive. It matured substantially in 2006 with an expansion of platforms and data sources. The platform was stable and flexible enough that by 2008, I could focus on adding new data sets, quants and analytics. In 2012, the static dashboard underwent a conversion to a cloud-based experience.
I’ve been using ISS for about nine years now in different B2B marketing settings for paid, earned, shared and owned (PESO) coverage. We give all contributors and stakeholders transparency into the tactical, operational and strategic levels of metrics and analytics at all times. It’s important to provide that transparency so they have full understanding and knowledge of the correlations up and down the stack. That improves performance and impact across the organization.
With the historical accumulated data, we can look back to gain insight into future performance across a widening range of events and situations. We can predict how we’ll perform in different scenarios ranging from routine product launches to special events to crises to any other scenario that is likely to present itself. Being able to predict how we’ll do and then measuring that performance are extremely valuable to executive leadership – and any marketing and comms leaders worth their salt. It’s the best way I’ve found to show that what we do goes way beyond simply throwing a bunch of darts and hoping one of them is lucky enough to hit the bull’s-eye.
Mark Stouseis vice president, Global Connect, at BMC Software. He is the creator of the Influence Scoring System. He was honored in January as the In-house Innovator of the Year at the In2 SABRE Awards in San Francisco.