Top 10 Marketing Automation Tips

The challenges associated with marketing automation can be overwhelming for many companies. Linking channels and departments and automating functions that have never been automated before creates complexities people never imagined.

"I think we're in for a couple of years of chaos," says Bruce Kasanoff, CEO of Accelerating1to1, a Norwalk, Conn.-based personalization consulting firm. More and more, companies are using interactive technology to communicate with customers without human intervention and giving access to more parts of the company and even to partners, he says. "Then, all of a sudden they say wait a minute, this is creating a situation we didn't anticipate. That's when you realize this isn't about training people to send an e-mail message, it's about changing the way we do business."

still, the rewards for marketers who do it right can be staggering. "Its potential is outrageous," says Barton Goldenberg, president of Information Systems Marketing, Washington, D.C. "If you can better segment your markets, understand the customer, help the salespeople and work with customer service, you can become that much more important within the company. You are the one that really drives a large part of the relationship with the customer."

Whether you're just beginning to investigate marketing automation or have already embarked on a project, hear what consultants have to say about the people, process and technology changes needed to maximize your results.

1. Develop a Vision
Like any automation project, companies need to understand the problems they're trying to solve. It might be that it takes three weeks for trade-show leads to get to salespeople, or maybe the company lacks metrics to measure campaign effectiveness. "There are lots of reasons for doing marketing automation, but you have to understand why you're doing it before you do it," says Goldenberg.

While it's easy to get enamored with the technology, the only way to maximize the automation effort is to identify where you can make the quickest gains. Otherwise, your project may languish before it even gets started, says Troy Reimschisel, principal consultant at PricewaterhouseCoopers' Chicago office.

"Identify either where you have your greatest pain or where you think you're going to get the greatest return for your dollar and your time, and go after those areas first," he says. "They may not be the easiest areas, but they're going to give you the highest value in the shortest amount of time."

Even while you're looking at immediate needs, don't lose sight of the bigger picture. Reimschisel says you also need to consider how the marketing automation system will fit with existing marketing processes and systems, as well as how it will integrate with other company systems. "These tools not only have to integrate well with each other, they need to integrate well with your company culture and your company processes," he says.

2. Understand the Organizational Impact
Companies can't think of marketing automation in a vacuum," says Laurie Hayes, partner at CRM Insights, Danville, Calif. "If they do, they'll never realize the potential of it. "Clients often ask, ‘How do I involve sales in my marketing automation implementation?' Well, if you look at it that way, you're screwed."

Instead, Hayes advocates a more holistic approach. Companies need to look at their whole organization, carefully identify all the areas that touch customers and involve all of them from the very beginning. Often, that includes more than just marketing, sales, telesales and customer service. "Now, with the auctions, exchanges and portals, there are huge opportunities to sell to suppliers. So just about everywhere in your organization you have an opportunity to implement your marketing strategy."

However, where there are people, there are egos and power struggles to consider. Organizational challenges are often more difficult to conquer than the technological ones. "We stress the organizational part quite a bit," says Larry Goldman at Chicago-based Braun Consulting. "We can get technology out within 90 days, but depending on the organizational change that's got to happen, that project could take 12 months."

For many companies, one of the biggest obstacles is customer ownership. "If you're divided by product lines and you think there are revenue opportunities in cross-selling, you've got customer ownership issues," says Goldman. "If you have brand managers and people want to do very targeted direct marketing, you again have customer ownership issues."

Without a doubt, the solution has to start at the top. "Somebody in a very senior role has to stand up and say, ‘I am for this,' and you have to work a little bit differently together to make this thing work," says Goldman.

3. Think Process First
For many marketing departments, talk of process or structure tends to be taboo. But when you're talking about automation, you're talking process.

"If you're really going to maximize the value out of a marketing automation effort, you have to be willing to take a process orientation," says Reimschisel. While it's not possible to automate creativity, there are many aspects of marketing that are very process-oriented, such as planning steps for marketing activities. Marketers need to understand which parts of their marketing processes can be optimized through automation.

Companies that already have good marketing processes in place are ahead of the game, according to Goldenberg. He says companies like Frito-Lay have very good marketing campaign steps or a process, making them ready for automation. For others, campaign management is not thought through. "They just spend money and hope they get leads," he says. "If a company has its act together on the process side, automation is a pretty good tool. If not, you have to spend two or three months getting your processes together and then try to automate it."

While some software products have work-flow built into them, Goldenberg warns that it's not generally a good idea simply to adopt those processes. "It would be a disaster to choose a marketing automation software that forces a process on your company," he says. "There's nothing wrong with looking at the process of the software and seeing if it's relevant, but you have to choose a process yourself, train the people so they're ready for it and then automate it."

4. Organize Around the Customer
As marketers increasingly add new channels to the marketing mix, the complexities of managing marketing messages are multiplied. "Everybody talks about multimedia, and people get excited about the fact that you can do so many campaigns through so many different channels," says Steve Diorio, president of IMT strategies, stamford, Conn. "What they ignore is that they have to manage that."

Multiple channels aren't the only problem. The more you introduce technology, the more you have to think about how you interact with customers, says Kasanoff. You may find that you have 50 product managers targeting unrelated messages to the same people. "How are you going to change your policies about interacting with people and how are you going to control that and coordinate it and make it seem to the customer like it's a benefit?"

According to the experts, handling these new challenges is best accomplished through developing teams of people to manage particular customer segments. "The one thing I can control is who I'm reaching," says Diorio. "If I understand my marketing segment, I can design the right mix of promotions and campaigns to suit that person."

If the organizational implications of shifting from products to customers are unsettling, Kasanoff says you could make people tremendously powerful, or you could make them coordinators who, when they see a potential conflict, raise a flag.

As you make the shift, don't forget to align compensation strategies accordingly. "Now that the technology is there to become customer-centric, marketers want to break out of their product-centric paradigm," says Goldman. "But if they're still compensated on the revenue of product A and not necessarily customer segment B, what are they going to do?"

5. Earn Customers' Trust
According to Kasanoff, most marketing automation systems today are being used to supercharge the existing way of doing business. Instead, companies should be using the technology to establish a more powerful and profitable way of doing business based on satisfying customer needs.

If you don't change your starting point, Kasanoff says, you're really just going to bother the customer, making it harder and harder to reach them over time. "All you're going to do is send them a lot more stuff, which is the same thing we've been doing for years: teaching people to ignore what we say to them," he says.

According to Kasanoff, marketers must earn the customer's trust by contacting them only when it's really in their interest to know about something. The more you do that, the more they'll be willing to share information. "If we're sensitive to when you want to talk to us and when you don't, then we're going to earn your trust and ultimately your business."

Once customers begin to share information with you, don't betray their trust by selling it on the open market. "If you can't make more money by keeping information about your customers confidential and using it to deepen the relationship, then you don't have a good business model," says Kasanoff. "We think companies should keep that information and think harder about what else they can do with it."

6. Monitor Data Integrity
There's no doubt that the foundation of any successful automation project is a clean database. While much time and effort is devoted toward developing a database, ongoing data quality assessment is often neglected. The high rate of data warehouse failures during the '90s has caused a new focus on that piece.

Goldman says he's seeing more requests for proposals that ask for specifics on methodologies used to ensure data quality. "We didn't even see that one year ago," he says. "Now, customers know it's a problem, and they know people haven't done it very well in the past."

Developing a data dictionary master file, which defines the terms used in the database, can help create consistency throughout the company. Beyond that, Goldman recommends developing a data steward program. These programs put business users in charge of data categories, such as products, customers or sales. Regardless of the department the information came from, that person is responsible when there's a problem. It gives IT one person in the company they can go to for help in chasing down and solving the problem. "All the IT department can do is run scripts that can detect problems," says Goldman. "Fixing it is a business issue, and that's where the data steward program comes into play."

7. Choose Software Carefully
It's a very confusing market right now, since no one vendor provides all the tools needed for marketing automation. Because of that, you need to make sure you understand how the components will fit together with your other systems.

Hayes advises that you ask vendors to not just tell you, but show you how information will get merged, how much code needs to be written and how quickly it can be implemented. Then go talk to the vendor's customers and come back with more questions. "The vendor is going to keep it at 10,000 feet; you want it very much at ground level," she says. "How much time, how much resources, how it works, how fast."

Reimschisel recommends asking vendors to demonstrate their products through a prototyping exercise. By asking them to show you how the software handles a real-life situation within your own company, you'll have a much better appreciation for what the software can and can't do. "Who in the world is going to tell you what they can't do?" he says. "If you ask vendors to demonstrate via a prototype how you would actually handle this situation, you're going to learn a lot more than trying to figure out through a demonstration and asking a few questions."

Goldenberg predicts that in two years we can expect more integration, but that's not currently the case. Even so, you don't want to wait. "The tools that are available are terribly valuable, so they're worth learning even as only a throwaway as we move to the future," he says. "They won't absolutely be a throwaway, but they may very well be."

8. Watch Outsourced Components
In these uncertain times, when technology is constantly changing, outsourcing pieces of your marketing automation can be an excellent alternative. "In many cases there's no reason to install a million-dollar software application when you can host it for $15,000 to $20,000 per month," says Hayes. "Technology is changing so quickly you want to make sure you can change as fast as the technology around you."

However, she warns that companies need to sit down with their third-party vendors to make sure they're capturing and keeping information for future business. In addition, make sure the hosted applications aren't core to your business.

She cites a dot com company that had originally outsourced its lead qualification. "They found that was the worst thing to do, because the hosted company had all the information in terms of who was a good lead and where the lead came from," she says. "That was information they were going to need moving forward that was completely lost because it was hosted outside."

Then they changed the hosted application to campaign management. The outsourcing of the lead qualification versus the campaign management was a complete wash in terms of cost, and they were able to get all the information they needed to run their business.

"The long and the short of it is, make sure your outsourcing strategy is consistent with the information that you will need in the present and in the future," says Hayes.

9. Test and Learn
More than ever, technology is allowing marketers to understand which promotions or campaigns appeal to specific audiences. Even so, those analytical capabilities are often underutilized.

The bottom line is that if you're sending the wrong message to the wrong customer, it doesn't matter how fast or cost-effective you become. It still won't increase revenues. "If you can cut your campaign creation from two weeks to one day, that's only going to work well if you know the right thing to say," says Goldman.

To underscore that point, he offers a personal example: "I always take cabs whenever I'm out of town, yet my Visa card constantly gives me promos on rental cars. But if they looked through my transactional statement, they won't find me renting a car anywhere. Where is that coming from?" he asks. "All it really does is annoy me."

What's needed is a rigorous campaign management discipline, according to Diorio. "Because I have such strong planning and analytical capabilities I can use this as a scientific method to continually refine the mix and understand based on customer buying behavior."

He says best-of-class companies, like IBM, have a very rigorous campaign management discipline. They've actually codified the campaign development process and are disciplined at executing and measuring campaigns on a common framework. "Simplistically, IBM can measure the performance of one campaign versus another, whether it's a mail campaign, versus a mail and phone campaign, versus a print and phone campaign, across product groups and across objectives," he says. "They do hundreds of campaigns every year, can rank them in terms of effectiveness, lop off the bottom half and resource the top half."

10. Work Toward Cross-Channel Consistency
One of the problems with marketing automation and CRM in general is that it tends to be implemented in bite-sized pieces. "The customers get varying degrees of customer intimacy," says Goldman. "Once you do really well through one channel, they're going to expect that level in each of your other customer touch points. When it's not there, the disappointment is twice as bad than if you were just bad at all of them."

That's where marketing strategy comes into play. Goldman says if you know how your customers are reacting, you can put a strategic plan together that's over and beyond just campaigns to make sure they're being treated well across all channels they're likely to touch.

It doesn't have to happen all at once. "If you've got a really powerful set of customers who use your 800 number, start there first, rather than trying to be all things to all people. You'll get to the other channels as time goes by," he says.

Providing consistent high-level service across all channels will become increasingly important. For those doing campaign management and segmenting now, the next challenge will be real-time synchronization across all channels, says Goldman. "Clients have mastered Marketing Automation 101 and are feeling pretty good, now they're coming back with this problem, and it's a lot more complicated than the last one."