- Category: September 2012 - Performance Marketing
According to Kimberly Collins, analyst at Gartner, the original four Ps of marketing — product, price, placement and promotion - are still valid, but there are four new Ps which must be added to the core of a marketing organization in order to manage increasing complexity and optimize marketing outcomes: people, processes, performance and profit.
To give you an idea of Kimberly‘s concept, we have summarized the four new Ps for you in the following:
The number of participants in the marketing ecosystem continues to grow as the complexity of marketing continues to increase.
Recommendation: Determine how to best align people and support collaboration across the marketing ecosystem. Evaluate marketing solutions on their ability to provide alignment, workspaces, and collaboration and knowledge management capabilities across the marketing ecosystems. This should include not only employees within the marketing organization, but also participants in other essential business units or those external to the company (e.g., agencies). Extend IMM globally across all regions.
Aligning people for collaboration and knowledge sharing is important, but documenting and automating processes is essential to ensuring effective and efficient alignment. As the complexity of marketing increases, process becomes important to align the appropriate people with the right marketing activities, to achieve faster times to market, to allocate human resources effectively and to perform closed-loop marketing. Without well-defined processes for marketing, it is impossible to manage the complexity, measure marketing outcomes and plan strategically.
Recommendation: Document and prioritize marketing processes. Look for integrated marketing management (IMM) solutions with robust business process management, like workflow and business rules capabilities, that can be extended across the marketing ecosystem and a diverse set of marketing processes. Evaluate visual drag-and- drop capabilities for workflow creation that can empower marketing managers to create and change processes as needed.
CMOs and marketing leaders are under pressure to measure the results of marketing campaigns and to demonstrate return on marketing investment (ROMI). Targeted marketing campaigns, particularly digital ones, have been highly measured, but areas of marketing around creative advertising and traditional media not really, if at all.
Recommendation: Marketing should work with finance and business intelligence (BI), as well as with the IT organization. Determine marketing's strategic objectives, and set key performance indicators ( KPIs) for each. Ensure that people and processes are aligned appropriately toward the objectives and KPIs. Measure performance and make changes as needed on an ongoing basis. Evolve toward more sophisticated simulation, forecasting and constraint-based optimization to support strategic planning of the marketing mix.
Marketing has historically been a cost center, but increasingly it has been challenged to prove that its campaigns and initiatives are driving revenue, such as, for instance, to identify which ones have the highest. Once CMOs understand performance and can measure it using KPIs, they must calculate ROMI to determine profit contributions.
Recommendation: Treat marketing as a profit center and ensure a good working relationship with the CFO. Establish attribution models to align revenue appropriately across campaigns, channels and media. Implement marketing resource management (MRM) for financial management to be able to collect and aggregate cost data. Calculate ROMI and share results with other corporate objectives. Use the results to model the optimal marketing mix.
Marketing technology can be a key enabler of the four new Ps. Through IMM, companies can now align and integrate executional, operational and analytical processes across the marketing ecosystem. MRM, campaign management and marketing performance management solutions all support elements of the four Ps.