© Robert Shaw and Philip Kotler 2009

Mapping the journey

from Idea-to-Demand How would you like to focus your creativity more effectively, take the brakes off processes, tighten How would you like to focus your creativity more effectively, take the brakes off processes, tighten How would you like to focus your creativity more effectively, take the brakes off processes, tighten How would you like to focus your creativity more effectively, take the brakes off processes, tighten controls and be more transparent, all while trimming costscontrols and be more transparent, all while trimming costscontrols and be more transparent, all while trimming costscontrols and be more transparent, all while trimming costs????

You’ve performed every creative trick in the book, won awards, the agency worships you but still the CFO and CEO aren’t impressed. They grumble about thriving on chaos, the lack of transparency, the fear that you’ll breach regulatory compliance and the sneaking suspicion the agency is ripping you off. Then they cite the recession as grounds for axing your marketing budgets. Frankly it may be time for you to bite the bullet and embrace the need for marketing logic.

Yet we’d wager your agency will push back; they’ll entreat you that all the necessary logic is already in place; they’ll maintain that what’s needed is magic. Your own team may be unsympathetic towards their work being checked, tested and formalised. So who should you believe, your CFO, your staff or your agency?

To make it easier to answer this question objectively, we’ve developed a simple set of Idea-to-Demand™ Guidelines (I2D) to explore and map your marketing logic, and discover bottlenecks, disconnects, muddle and wastage. Having done this, you must then make sure to choose practical solutions, where logic won’t destroy magic. ExplorExplorExplorExploring anding anding anding and MapMapMapMapping your Marketing ping your Marketing ping your Marketing ping your Marketing LogicLogicLogicLogic The I2D Map (see diagram) presents a path for exploring and mapping your marketing logic. The central concept is to follow the logic by which ideas flow from creative minds and keep following them to see how efficiently they are processed and how effectively they grow and sustain demand. A map is useful because the logic is often foggy; it’s obscured by clouds of waffle, half-truths, hype and humbug.

In the many client investigations conducted using this methodology, 90 percent of management attention is on the “magic”, the ideas end of the process where creatively minded people work in a

stimulating environment. Yet 90 percent of the cost is incurred in the “logic” part of the process, where the back room people work, their jobs and lives unacknowledged without the glamour and excitement of “magic”. The logic often suffers from neglect, and when it inevitably breaks down, costs spiral out of control, deadlines get missed and results are disappointing.

With a good map, the logic can be explored, and all the forward and backward steps tracked as different players interact with different ideas and agendas; these steps involve marketers, company lawyers, purchasing personnel, external specialists in media and production, sales people, the company’s supply chain, R&D engineers, management accountants, distributors, dealers and so on. Tracking this logic can reveal bottlenecks, duplication, wastage, logic failures, and candidates for change. Here are some examples. The Logic of The Logic of The Logic of The Logic of Ideas Ideas Ideas Ideas How logically are you managing ideas? Do you have enough ideas or too many? With many creative projects in play, it becomes harder to weed out the many mediocre ones that burn up management time and resources, and even more insidious, the really few good projects get starved of resources. The Logic of ProductionThe Logic of ProductionThe Logic of ProductionThe Logic of Production How logical is marketing production? Is it over-complex; are all the steps and signatories really essential? Are you paying a realistic price for production supplies and suppliers? Is time and

money being wasted? Have you too many suppliers and agencies? Are image and text files getting duplicated and reinvented by people in different locations, departments and business units? All this complexity causes missed deadlines, compliance errors, scrap and re-work, cost over-runs, duplication of work and overspend on duplicated images. The Logic of DistributionThe Logic of DistributionThe Logic of DistributionThe Logic of Distribution How logical are your media and channels? Is your media agency working for you, the media owners, or out for themselves? Are they giving enough care and attention to media selection and scheduling? Are channels and intermediaries squandering and misusing your marketing material? Are they telling you one thing and doing something else? The The The The Logic of Logic of Logic of Logic of DemandDemandDemandDemand Is marketing connecting logically with demand? Or is marketing just image and window dressing? Are you spending too much attention on consumer attitudes and trade satisfaction and too little on results? Are you making enough effort to analyse and explain demand patterns? The Logic of ROIThe Logic of ROIThe Logic of ROIThe Logic of ROI Do your marketing ideas have positive returns? Or is marketing just an act of faith? Are you estimating every penny you get back for every penny you spend? Adding logic to the magicAdding logic to the magicAdding logic to the magicAdding logic to the magic By answering these questions, you’ll also generate a list of problems. Which ones should you try to solve, and when and

IdeasIdeas ProductionProduction DistributionDistribution DemandDemand

projects collateral stimuli

Return On IdeasReturn On Ideas

© Robert Shaw and Philip Kotler 2009

how? You need to find practical solutions with tangible benefits that avoid destroying the creative magic. Here are some examples where logic delivered has tangible benefits. Rethinking IdeasRethinking IdeasRethinking IdeasRethinking Ideas • Share ideas and encourage collaboration Use modern information systems to share ideas and encourage collaboration. Innovative ideas that are scattered across regions, countries and business units, stored in emails, word documents and spreadsheets, should be shared in a common ideas bank to encourage collaboration.

A $30 billion global technology company with a long history of creating innovative products and services. However their innovative ideas were scattered across regions, countries and business units, stored in emails, word documents and spreadsheets, without any easy way of sharing and collaborating. Because there was no central database, they were missing opportunities to get everyone on the same page and improve the efficacy of our innovation processes. Today they have implemented a system that shares ideas and encourages collaboration. The system has given them the support needed to achieve their ‘One Company Roadmap’. Rethinking ProductionRethinking ProductionRethinking ProductionRethinking Production • Simplify and automate production checks and controls Multiple production checks and controls are useful only when the risks are high. Map out the processes, find out who are signatories and reviewers, check the legal implications of checkpoints, and then robustly cut any checks and controls that are not absolutely essential.

One of the five largest pharmaceutical companies in the world produces many thousands of promotional pieces every year. In the highly regulated and compliance laden industry, maintaining control while improving efficiency is doubly challenging. They are addressing these challenges by implementing a powerful workflow system that integrates the medical,

marketing, legal and regulatory and sales departments, tracking work as it zig-zags between departments and tracking signoff and review to ensure tight compliance and rapid turnaround. They have managed to reduce cycle times by 80% and are able to respond faster to competitive and regulatory changes. And by oiling the wheels of marketing production, their creative teams have more time to spend on ideas. Rethink DistributionRethink DistributionRethink DistributionRethink Distribution • Monitor and control media selection and buying Demand much greater transparency from the media buyers and owners: clear media briefs; rolling media plans; reviewing final media buys against planned buys; media invoices and proof. Already it is becoming common practice for media auditors to carry out annual reviews, but companies are also beginning to recognise that bringing the monitoring and control in-house is a more satisfactory solution.

A large entertainment company spends tens of millions on TV advertising. With up to 100 campaigns in parallel, they relied almost entirely on hunch and gut-feel in placing their weekly media purchases. To improve the return on advertising, they built a dynamic demand analyser that analyses all 100 campaigns in parallel and provides guidance on where optimally to place their next media purchases. Rethink DemandRethink DemandRethink DemandRethink Demand • Enhance demand forecasting Early warning systems that gather information from all key points on the distribution chain – media, sales, intermediary and channel activity – can be plugged into forecasting systems to give more accurate forward projections so that the supply chain is synchronised better with the demand chain.

One of the world’s largest cosmetics companies, employing more than 50,000 workers in Europe and the Americas lacked a single demand planning system and process. Forecasting was conducted manually using Excel spreadsheets and it was a time consuming process. The

manual process didn’t have the ability to shift its key metrics quickly, a capability that is critical in the beauty industry. What they needed was a demand forecasting tool that could support process standardization and produce a systematic input for the supply chain. So, they replaced their “spreadsheet city” with a state of the art demand forecasting tool. It captures key forecasting inputs from the sales teams, from marketing planners, pricing teams and sales promotions planners, and enables them to deliver robust forecasts in the fast moving beauty industry. Return on IdeasReturn on IdeasReturn on IdeasReturn on Ideas • Making ROI routine All significant marketing activities should be evaluated, rigorously and independently of the agency concerned; don’t take the easy option of letting the agency mark their own homework. A large consumer products firm has introduced a standard evaluation template; at planning time, the brief is accompanied an evaluation plan; budget is set aside to pay for the evaluation; post-launch and 6 months later they evaluate the projects, learning which worked effectively and which didn’t and why. This learning has not only pleasing the CFO, even the creatives like it. ConclusionsConclusionsConclusionsConclusions In the majority of cases we’ve worked on, there was an overwhelming case for adding logic to the magic of marketing. By following the I2D Map, marketing organisations explored the practical opportunities to deliver more, to focus their creativity more effectively, take the brakes off their processes, tighten controls, be more transparent, all whilst shaving 10 percent off costs and smooth things with their CFO. None of them reported that magic suffered, most reported that creative people were happier working in the new more logical environment. This is an abridged preview of an article by Robert Shaw and Philip Kotler appearing in the AMA Journal Marketing Management.