Speaking the language of management
Published on 08/02/1999 under Accountability
Recently I've heard several speakers at advertising conferences comment on the language differences between corporate management and advertising people. Undoubtedly, language barriers are among the "cultural issues" that are driving us apart.
Top management talks about making investments and getting adequate returns on those investments. Advertising people talk about spending enough to "break through the clutter."
Top management talks about being "customer-driven" and understanding the needs of the customer. Advertising people talk about brand image and getting customers to play back image attributes we think are important.
Top management talks about best practices and ways to establish performance benchmarks. Advertising people compare our latest campaign to the competition and talk about knocking their socks off.
And while all of these subjects are individually important, it should be obvious we're not even close to speaking the same language. So why are we surprised when management never seems to go along with our recommendations? Or go with them far enough?
It's time we changed the way we propose, implement and report on the status of our marketing communications programs. And at the very heart of this change, it's time we demonstrated accountability in countable terms that management requires.
And while this is easy to say, it's not so easy to accomplish because much of what we do is difficult to measure. Notice I said difficult, not impossible.
Let's say you're introducing a high-performance plastic material, but your company is known primarily as a manufacturer of "commodity" plastics. You've discovered the new product offers exciting performance advantages over all existing competitive products. It has the potential to become your number one seller in volume and gross profit.
Unfortunately, as a commodity plastics company your marcom budget is quite modest. You're hoping (somewhat naively) that management will double your existing budget to give the new product a proper launch. How do you go about proposing that large an increase?
Well, as I have suggested in two recent columns, my first step would be to call other chemical company marcom managers and ask what "investments" they have made in recent new product launches. Of course, you wouldn't call competitive plastics companies, but if you make enough calls you can probably establish some "benchmarks" for what it takes to get a similar new product out of the gate.
If your sources tell you they can't share that kind of information because it's confidential, tell them they must for the good of our industry. The reason we marcom practitioners have such a hard time estimating what things cost is because we've deceived ourselves into believing such information is proprietary. It's not, and WE MUST QUIT ACTING LIKE IT IS!
Okay, now that I have that temporarily out of my system again, let's proceed.
As you gather benchmarking information for marcom investments, you should also ask for some indication of the corresponding sales revenues involved. Now this is where it gets tricky, because companies really do guard this information as proprietary.
However, you probably can get your marcom sources to tell you approximately how much sales revenue was at stake. Use the "bigger than a breadbox" approach. Was it more than $1 million? More than $10 million? More than $50 million? You should be able to get a rough range of expected sales to compare with the marcom expenditures you already persuaded them to tell you about. (Be sure NOT to start with the sales questions.)
Now we need to establish some metrics (another good top management word) for the big product launch. This is easy if you're involved in product development meetings from the very beginning. But most marcom people, unfortunately, get involved late in the game -- when the product manager calls about getting started on a specific project, like a brochure or tradeshow promotion.
It's tough to get them to back up and talk about measurable steps that will lead to the ultimate sales goal, but this is what you must do if you're hoping to improve your standing with top management. Without the metrics they deem important, you're effectively blocked from strategic matters and reduced to the role of tactician.
Take a few minutes to discuss how the product manager or marketing manager envisions the successful selling program: How many qualified leads will be needed? (What determines if leads are qualified?) How many product demos will be conducted? (Will they need a demo kit?) What about field trials? (Can you eliminate this step with a compelling video or CD-ROM presentation?)
Now you should have some realistic communications objectives to shoot for. And if you have measurable objectives, you should be able to set reasonable marcom activity budgets that correspond to the size and difficulty of the objectives.
More importantly, you should also have a clear understanding of the sequence of events that will spell success, which will be invaluable in helping you integrate your communications activities into the selling program.
So how do we get the money to do this program?
When you go to top management with your budget request, it should sound something like this: We plan to invest X thousand dollars in a program to achieve first year sales of Y million dollars, and five year sales of Z million dollars. In order to do this, we will generate XX qualified sales leads in the first six months, which will result in YY product demonstrations during the second and third quarters. While some field trials are already being discussed with key accounts, we plan to stimulate interest in a minimum of ZZ trials during the first twelve months, which will assure the first year sales objective and create an order backlog for year two.
The only thing left to do is measure the results of your program as it unfolds. If you want to be successful with top management, you've got to speak their language. And today, that language is accountability.