Stopwatch Marketing Blog

The Four Pillars of Profit-Driven Marketing is, indeed, another book just as good as Stopwatch Marketing. In fact, it’s an outstanding book that deals with the most important issue in marketing today. I meant that last comment: I do believe that developing some discipline around the measurement of productivity – ROI – of marketing efforts is more important than “understanding Social Media,” or “marketing in the downturn,” or “tapping into Gen Y,” or “outsourcing,” or “media fragmentation,” or any one of a number of other issues marketers confront today. In fact, measuring performance and using it to guide future marketing decisions is the critical issue that affects all those others. It is certainly representative of the most frequent question I get from my clients: “How do I measure success of marketing efforts?”

Written by a couple of Booz consultants, Leslie H. Moeller and Edward C. Landry, Profit-Driven Marketing offers an easy-to-understand rationale and approach to answering that question and, more importantly, institutionalizing an ROI-driven attitude into marketing departments.

Like all genius, the Four Pillars themselves, seem simple and straightforward, prompting one to ask, “Why didn’t I think of that???” They are:

1. Analytical Understanding

2. Decision Support Tools

3. Embedded Processes

4. Aligned Organization

    

The book contains a few well-chosen case studies to demonstrate the effectiveness of embedding a disciplined, ROI approach. Capital One’s rise to the upper reaches of consumer banking – and reasonable success surviving the current crisis – was driven by clear-headed focus on documenting and acting on the ROI of each marketing program, consumer segment, promotion, etc.

More illuminating for traditional marketers may be the Kellogg’s TPE (Trade Promotion Excellence) program. This program, built on ROI models of each cereal brand and trade promotion, empowers local sales representatives to pick and choose among a menu of trade promos (rather than a single national one) in conjunction with their retail buyers. So, Jewel and Dominick’s or Shaws and Stop & Shop make be promoting different cereals / sizes at the same time, based on disciplined analysis of each chain’s customers and needs. Now here’s the kicker, pay attention: Moeller and Landry’s ROI-focused approach is emphatically NOT REPEAT NOT a surrogate for driving marketers to more easily measured marketing tactics: The Kellogg’s TPE program “…enabled Kellogg’s to divert investment dollars from trade promotions to brand building and new product innovations.” That’s right, FROM trade promotions. For all those old-fashioned marketers who avoid detailed, ROI-driven measurement protocols, here’s what you’ve been looking for: If you build an appropriate and effective model and IF you are right – brand building trumps trade promotions – then the model will prove the effectiveness of your long-term gut instinct and arm you with the tools to do that brand building!

Bottom line, you can’t be disciplined enough and you can’t get by today without an effective, quantitative model of the marketing efforts you are working with. In our own work with clients on new product development, we have built an very nice business with our Desktop Strategizer^SM model that empowers product development types to run endless “what if” scenarios that predict the ROI of the anticipated product intro.

This is an excellent book, and belongs A) in you briefcase for your next airplane trip and B) next to Stopwatch Marketing on your bookshelf.

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