Operational efficiency is one of those metrics every C-suite knows is important to their brands’ long-term success — and one that needs to be regularly addressed and enhanced.
For instance, manufacturers are certainly familiar with how to improve operational efficiency.
Many have used the benchmark for years to gauge the effectiveness of various business adjustments (e.g., the implementation of production-cost-cutting measures to save money).
However, to many corporate leaders today, operational efficiency is a somewhat abstract metric they don’t quite know how to amplify — or even which team should ‘own’ it.
What’s more, you could ask a dozen executives how they define or view operational efficiency today. And, chances are, you’ll hear a dozen different answers and vantage points.
Some will say it entails reducing operating costs and becoming more cost-effective across their companies. Others will indicate it’s more about augmenting their current business processes and departmental infrastructure to better their bottom lines.
One facet of operational efficiency many forget, though, is the marketing element.
Specifically, execs overlook the impact (positive or negative) their marketing technologies have on day-to-day output, long-term growth, and even their business resilience — a particularly critical factor, given how COVID-19 has irrevocably changed the commerce landscape and, thereby, how brands understand and interact with customers.
Simply put, failing to account for marketing in your efforts to enhance operational efficiency can — well — lead to long-lasting inefficiencies for your entire organization.
Improving operational efficiency: An aspiration for many marketing leaders
Marketing leaders working hard to improve operational efficiency isn’t anything new.
As a pair of McKinsey analysts wrote for Destination CRM way back in 2006, CMOs have been attempting to appease leadership at their respective companies by enhancing efficiencies in their programs and throughout their teams for some time:
“CMOs face growing pressure to deliver improved performance for shareholders. They must squeeze more productivity from each campaign, more output from each employee, and more return from each marketing dollar.”
This pressure from one’s executive team comes with the territory, of course.
In recent years, though, studies show many CMOs have been able to alleviate this pressure — and increase efficiencies for their teams — through modifications to their tech stacks.
For instance, elevating their marketing efficiency was deemed a top priority for 55% of marketers, per a 2020 Ascend2 survey.
More specifically, many marketing leaders now embrace the best-of-breed approach to stack construction (i.e., investing in top-tier tools from various vendors) to bolster efficiency.
Too many CMOs, though, neglect to factor in both the operational efficiency and strategic value a technology provides their marketing orgs (and businesses at large) when building (or rebuilding) their bespoke stacks.
Too often, CMOs only focus on whether a given tool helps their teams achieve tactical KPIs (acquisition, retention) and grow standard marketing metrics (likes, clicks, opens).
But they also need to discern whether a particular tool can enable greater efficiencies that will make their teams more effective in their respective roles in the long run:
- Reduced reliance on external agencies, IT, analysts, and data science to leverage data
- More time to handle tasks often put on the back burner, like producing new creative
- Automation of some (certainly not all) marketing tasks (e.g., dynamic segment updates)
“Assessing the efficiency and value of marketing technology means understanding how it will fundamentally change the nature of a marketer’s job, and in turn, help them transform customer relationships,” BlueConic COO Cory Munchbach noted for CMSWire.
Increasing marketing efficiency: Best achieved with a customer data platform
Routinely revamp their customer experience (CX) strategies by ensuring they deliver the most timely and targeted consumer engagement across channels based on the most up-to-date and accurate first-party customer data in their database ecosystem.
That’s the collective — if fairly specific — goal for marketing professionals today.
But without tech that facilitates smarter personalized messaging and provides intricate, real-time audience insights, a more efficient CX will remain (well) out of reach for marketers.
Customer data platforms (CDP) came into existence to solve this exact pain point.
And brands that have adopted the solution — particularly pure-play CDPs their marketers can own and operate with ease — have realized greater operational efficiency in three ways:
- #1) Streamlined operations for their marketing organizations, top to bottom: By eliminating unnecessary steps and detrimental processes while also lessening dependence on legacy systems that prevent their desired marketing outcomes and ROI, marketers with a CDP can get things done faster and in a more intuitive way.
- #2) Ability to implement and scale customer lifecycle marketing programs: With a CDP that a) aligns with their most important business use cases, b) provides the means to handle the volume, variety, and velocity of first-party data from across all systems, and c) offers lifecycle orchestration capabilities to deliver hyper-personalized messaging to each individual, marketers can more capably accelerate and scale their strategies.
- #3) Transformed customer interactions based on in-depth audience insights: A CDP can bring the art back to marketers’ work. With more actionable data at the ready (not to mention a full single customer view), they can more suitably engage with prospects and customers and move from static, rigid campaign workflows to dynamic, reactive interactions across channels and lifecycle stages.
Fast-fashion retail brand and BlueConic customer Planet Blue is a prime example of a brand that has (and continues to) streamline, scale, and transform its marketing as well as enable greater operational efficiency across the business:
- The retailer’s marketing team scores its prospects and customers based on real-time, first-party data unified from across channels. This, ultimately, informs data-driven decision-making not just for its marketing arm, but also for several other departments.
- For instance, its marketing org calculates the customer lifetime value (CLV) of shoppers by store location. This helps them dictate marketing budget (e.g., paid search spend) allocated to those locations. The highest-CLV area, for example, gets the most.
- They also use CLV data to determine which clothing brands sell the most and, as it relates to its physical stores, where they’re most popular. This data aids merchandising with vendor negotiations and provides additional cost savings for the brand.
As you can see now, operational efficiency comes in many forms.
But achieving marketing efficiencies that subsequently have a positive impact on every aspect of your business and consistently grow your brand’s bottom line can only truly be gained with an advanced technology like a customer data platform.
Addressing operational efficiency key to greater marketing ROI, business resilience
The ultimate goal of improving operational efficiency isn’t just to make everyday marketers better engage their target audience and help CMOs prove their worth to their C-suite.
It’s also about contributing to the overall ‘operational excellence’ of their brands.
With more streamlined, scalable strategies and sophisticated, customer-centric lifecycle messaging executed with a CDP, marketing leaders and their teams can contribute to continuous improvements across their businesses — not solely for their teams.
For instance, complete access to first-party data collected by the brand and unified in a CDP enables customer service team members to better serve buyers and subscribers.
Some enterprise executives think hiring external consulting firms and advisors to help them map out and accomplish their efficiency objectives within marketing and elsewhere across their companies is the clearest path to operational efficiency success.
And maybe that avenue is optimal for some large-scale organizations.
But, at the end of the day, it’s these C-suite members — especially CMOs — who have to decide what changes need to be made regarding their people, processes, and technology in order to realize better outcomes and greater efficiency.
A more methodical, higher-performing marketing strategy can’t be implemented by only amending internal processes or reassigning roles and duties to marketers, though.
Rather, as Gartner Senior Director Analyst Marc Brown astutely noted:
“Marketing leaders can’t fulfill the promise of customer-driven revenue growth using old organizational structures overlaid with new technology.”
Even just a handful of years ago, CMOs used to have to fight for spot at the C-suite table.
Now, they’re far more important to organizational objectives and digital transformation due to growth in martech and (constant) changes in consumers’ behaviors and buying (e.g., far more people buying mostly or exclusively online amid the pandemic.)
Thus, it only makes sense marketing leaders ‘run the show’ regarding martech evaluation and selection and, thereby, ensure they continually improve operational efficiency.
The trick is selecting the ideal marketing technologies to enable this efficiency — beyond just improved marketing outcomes.
Marketing leaders need to have the right risk-reward protocols in place when assessing various technologies to incorporate in their hub-and-spoke stacks.
In other words? They must make well-researched investments, but also consider the long-term marketing ROI from those investments and how the tech they onboard can make their teams and businesses at large more resilient during turbulent ‘down’ periods like 2020.
With a CDP that unifies all customer data, streamlines marketing tasks (namely analysis, segmentation, modeling, and activation), and helps them scale without the need for technical support, CMOs can rest assured they’ve charted the right course to increase operational efficiency — and help their businesses consistently grow their bottom lines.
Download our in-depth eBrief to discover how to improve operational efficiency for your marketing team and company with a pure-play customer data platform.