This document outlines the key points from a presentation on establishing efficient marketing operations. It discusses the strategic advantage that efficient operations can provide, including enabling organizations to compete more effectively with limited resources. Common issues facing CMOs are also examined, such as demonstrating marketing ROI. Research findings show marketing operations capabilities are linked to higher growth and effectiveness. The presentation provides ideas for measurement, governance models, and technology strategies to improve operations. Attendees are encouraged to establish efficiency as a first step to gaining a competitive advantage.

1. From Planning to Execution:The Strategic Advantage of Efficient Marketing OperationsMay 21, 2009

2. Agenda Introduction What’s on your CMO’s Mind? Model for a Marketing Operations Center of Excellence Metrics and measurement of marketing programs Results from 2009 Lenskold Group study What can I do next? Questions and Answers The Strategic Advantage of Efficient Marketing Operations 2

3. Marketing Planning to Execution Model Efficient processes are critical to success 3

4. Introduction Example of a high-level marketing supply chain 4

5. Introduction Example of a mid-level marketing process map 5

7. Challenge: Establish a process that ensured all marketing materials are created and distributed on time to meet marketing objectives.

8. Solution

9. Established standards and key milestones for each type of activity

10. Established a quarterly planning process – forward looking 4 quarters (2/2)

11. Built a home-grown Marketing Ops application that organized projects and provided reports and status to all marketing stakeholders (published weekly on Monday)

13. Integrated Calendar

14. Standards

15. Management tool to track projects

16. Reports based on Milestones

17. Weekly Report & Red Flag Status

18. EVP Support

20. Issues facing the CMO and Marketing CFO wants visibility into marketing performance “What is all this money buying?” CEO and Board demand more accountability Sarbanes-Oxley compliance Disconnect between the languages of finance and marketing Quarterly financial reporting Turnover of C-level executives CEO urges marketing to become a center of innovation and growth Flat or reduced budgets and headcount in marketing, with expectation marketing will deliver at same level of effort and quality Staff turnover together with lack of “corporate memory” about marketing strategies, plans and programs, assets Internal pressures 9

22. “Internet effect”

23. 24x7 markets

24. Faster time-to-market

25. Consumers have more choice

26. New competitors where they did not exist before

27. Traditional competitors have become more effective marketers

28. Proliferating communication channels

29. Social networking – how do I use it effectively?

30. Agencies as project resources versus long-term Agency-Of-Record

31. Agency staff turnover

32. Short-term, quarterly financial reporting for public companiesExternal pressures 10

33. CMO Council “Calibrate How You Operate” Study 60 percent of respondents believe that marketing operational transformation is an essential area of focus. Only 4.5 percent are satisfied with their current level of marketing operational visibility, accountability and output. Overall marketing operational effectiveness is considered the least developed operational area by nearly 50 percent of respondents. 2009 - Key Findings 11 © 2009 CMO Council This study was sponsored by Alterian. Visit www.alterian.com for a copy of the report.

34. Marketing Imperatives Demonstrate value - Identify more accurately and conclusively the return on marketing investment at all levels of detail Execute effective programs - Gather and analyze significant amounts of customer data to enable greater insight into what customers need, and how and when they buy Execute programs efficiently - Gather and analyze operational and financial data to improve the effectiveness of programs while driving down the cost of marketing Establish a corporate memory for Marketing - Preserve and protect staff knowledge and marketing intellectual property, as well as digital assets, to ensure legal and contract compliance, facilitate reusability and ensure continuity of plans and strategies across years Marketing leaders address the pressures 12

35. The Case for a Marketing Operations Center of Excellence

36. The Business of Marketing The “business of marketing” is -- the organization and management of internal and external supply chains -- to produce insight‐driven programs -- that launch on time and on budget -- are aligned to corporate objectives -- and demonstrate a return on investment at or above the company’s minimum acceptable rate of return*. * Companies often use 12% as the “hurdle” rate. MarketSphere definition 14

37. The Five Roles of Marketing Marketing Operations is the “Fifth Role” of Marketing 15 Brand Product &Innovation MarketingOperations Life Cycle/Revenue Voice of theCustomer

38. Marketing Operations Organization – Five key responsibilities 16

39. Marketing Operations organizational concept Marketing Operations chief should be equal to the others 17

40. Planning and Project Management Office Create and monitor the annual Marketing Plan Create and monitor the integrated Marketing Calendar Work with Brand, Product, Voice of the Customer, and Life Cycle Marketing teams to translate corporate objectives into action plans Hold quarterly reviews in conjunction with the CMO Operate a marketing resource management application Monitor and publish reports and dashboards that combine customer, operational and financial metrics and Key Performance Indicators Managing the integrated project schedule 18 Measurement: On-time and on-budget performance of actions plans in conjunction with assigned managers

41. Marketing Governance Manage and control the marketing budget Monitor and report financial and operations metrics (KPI’s), and calculate ROI of marketing programs Translate “finance speak” into “marketing speak” and vice versa Ensure alignment and reporting of corporate objectives to marketing budgets and results Recommend to CMO the optimal allocation of marketing budget dollars (or other currencies) Audit financial performance of suppliers; ensure compliance with corporate purchasing guidelines Provide Sarbanes-Oxley compliance Managing the investment portfolio 19 Corporate objectives aligned with marketing budget and programs Measurement: performance against plan(s), forecast accuracy, increased year-over-year ROMI (return on marketing investment)

42. Shared Services Manage marketing services Graphic arts and writing Web and e-mail operations Marketing research and analysis Traffic and production management Implement approved programs on the marketing calendar Manage day-to-day relationships with agencies, oversee procurement Manage or coordinate with other marketing-related functions like Customer Services, Call Centers or Fulfillment, to ensure brand/message consistency, and awareness to marketing programs Maintain labor standards and attain optimal mix of staff, freelance and agency resources Maintain service level standards and enforce brand consistency A model for more efficient operations 20 Measurement:reduction in the cost of operations, internal brand stewardship score, “internal customer” satisfaction – service delivery level

43. Enterprise Marketing Management Strategy MS-Office is the technology workhorse of Marketing, especially MS-Excel The move to Customer-centricity drove the need for Customer Resources Management, Sales Force Automation and customer analytics Email combined with websites, micro sites and landing pages has emerged as a “lower cost” communication channel, which continues to drive the need for campaign management, email processing software and web analytics Compliance and the need to manage and share knowledge, and protect a company’s intellectual property, is driving the need for marketing systems of record Applications and data are often managed in their respective silos of marketing functionality (i.e., direct marketing owns campaign management, IT owns the website, customer services owns CRM) Introduction 21

44. Marketing Automation Ecosystem A not-so-integrated set of technologies that support Marketing 22

45. Enterprise Marketing Management Strategy An enterprise marketing management strategy defines a goal: Alignment of technology to support corporate and marketing objectives Role-based application functionality Marketing data in a central repository Enables analytics and insights Promotes reusability of content Assures compliance Promotes knowledge management Establishes a “corporate memory” for the marketing organization (a logical marketing system of record) Process and organizational alignment are key success drivers Long-term horizon for full realization of benefits Put into practice 23 Measurement: Reduced risk of non-compliance, reduction in production cycle times, reduction in “on boarding” time, cost savings, brand consistency, department productivity improvement

46. Role-based EMM Model (Sample Retail Client) 24

47. Strategic Advantage Prepare for the economic rebound to come in 2010 and beyond Ensure marketing programs and budgets are aligned to corporate objectives Implement central governance and project management Streamline and rationalize marketing processes Reorganize the marketing department to compete in the new economy Measure marketing programs and calculate their ROI With an efficient operation, you can: Compete more effectively in a 24 x 7 marketplace Compete at a lower unit cost Launch products into the market quicker Launch marketing programs faster than your competitors Preserve and protect the company’s intellectual property Continue to drive growth with limited resources Gaining strategic advantage through efficient marketing operations 25

48. Strategic Advantage Strategic advantage comes from being highly effective marketers – generating programs that achieve incremental year-over-year growth through insights and smart targeting. It also comes from operating a highly efficient marketing organization – generating incremental year-over-year cost savings through cost management and productivity improvement. Gaining incremental savings through efficient marketing operations 26 Incremental Savings Incremental Growth Shareholder Value Free cash flow

49. Metrics and Measurement of Marketing Programs © 2009 Lenskold Group, Inc.

50. Lenskold Group Research Key Findings – 2009 Marketing ROI and Measurements Study 28 2009 Marketing ROI & Measurements Study The fifth annual research study on marketing ROI and measurements, featuring an assessment of current economic conditions and marketing operations on managing marketing effectiveness and growth. “ We consistently see that the high performing marketing organizations tend to have advantages in marketing operations, strengths in generating insights, and ROI discipline.” 24% of companies report using some measure of ROI, marketing profitability, or similar measure For firms that consider themselves “highly effective and efficient marketers” this number is 54% Source: 2009 Lenskold Group / MarketSphere Marketing ROI and Measurements Study Available at www.lenskold.com.

52. Organizational pressure from senior management is quite high

53. Firms using ROI are more likely to report expecting greater growth than competitors

54. Firms reporting that they calculate ROI are 3 times more likely to report marketing as “highly effective and efficient”Source: 2009 Lenskold Group / MarketSphere Marketing ROI and Measurements Study

55. Marketing Operations Capabilities Over half (59%) report dedicated marketing operations team Highly effective and efficient & greater growth more likely to have marketing operations team Firms reporting they have dedicated marketing operations report Use customer data to improve effectiveness Use data/facts to improve spend decisions Understand profit drivers to prioritize budget 30 Source: 2009 Lenskold Group / MarketSphere Marketing ROI and Measurements Study

56. Lenskold Group Research Marketing Operations teams found to have broad range of diverse responsibilities “Highly effective and efficient” & “greater growth” companies are more likely to have marketing operations team Key Findings – 2009 Marketing ROI and Measurements Study 31 Source: 2009 Lenskold Group / MarketSphere Marketing ROI and Measurements Study

57. What can I do next?

59. Participate in vendor webinars

60. Attend industry conferences

61. Read “Enterprise Marketing Management”by Dave Sutton and Tom Klein

62. Gather research from Aberdeen, Forrester, Gartner and the CMO Council

63. Join a LinkedIn Forum (Marketing Operations, MOCCA, Chief Marketing Officers)

64. Find a corporate objective that would benefit directly from a more operationally efficient marketing department

65. Review and improve existing marketing processes (pre-automation)

66. Partner early with IT and Finance

67. Enlist an executive sponsor who will benefit from improved operations

68. Design a roadmap detailing the steps to be taken

69. Remember change management!