Transforming marketing from a cost center to a revenue center is complex and involves many moving parts, from a new mindset to new skills to new technologies. We are still very much in the early days of watching this marketing transformation occur so we still have an absence of common terms, frameworks, and models. What we do have is DIRECTION. And that direction is about the rise of the marketing operations (MO) function and how marketing is now being managed like a business (marketing performance management or MPM). In this blog post, I’ll discuss the history of marketing operations, present a framework for a marketing ops maturity model, explore the relationship between MO and MPM, and suggest key actions to take for 2017.

The History of Marketing Ops

I’ve been writing about the marketing operations function for a while. In 2013, I published my first version of the Revenue Marketing Center of Excellence white paper and fully laid out the organizational structure, roles and responsibilities for the marketing operations team (as well as the entire center of excellence). Since 2013, we have updated the white paper as the marketing operations function continues to evolve.

From 2013-2015, marketing operations was more of a covert operation. Few companies had a fully functioning marketing operations organization and most companies had a few folks with part-time responsibilities for data and analytics. As we came into 2016, marketing operations began emerging as the fast-growth area of marketing. Scott Brinker’s MarTech conferences were growing and we began to see a great deal more sophistication and breadth of responsibility of the MO function.

In early 2016, I published the first version of The Rise of the Marketing Operations Function based on interviews with leaders of MO functions in 11 different companies. (I’ll be publishing an update to this paper later in February – stay tuned!) I also began to invite guests to my radio show – Revenue Marketer Radio – to talk about marketing operations. In November 2016, I had the pleasure of hosting a show about MO and my guests included Verint, SecureWorks, and Lenovo. Listening to this show is like getting a primer on what you need to do to have a successful MO group. This team was amazing.

As I continued to understand the phenomenon of the rise of the marketing operations function, I created a four-stage Marketing Ops maturity model. I have found in working with hundreds of companies that just proving the direction and the key landmarks is highly valuable on this journey. Every company is unique with their own distinctive set of characteristics and in the early days of marketing transformation, providing direction is a big help. During the week of February 13th, I’ll be broadcasting on Facebook Live (from our Pedowitz Group Facebook) about key elements of the Marketing Ops Maturity Model.

Sneak Peak of the Marketing Operations Maturity Model

The MO Maturity Model includes a general description, charter, key responsibilities, strategy, people, process, technology/data, customer, and results for each stage of MO maturity. Here is a synopsis of the general description.

Stage 1: Reactive

A Reactive MO capability is an ad-hoc response to the tsunami of technology and change. MO functions as decentralized collection of marketing ops tasks from disparate groups and with no central vision or leadership. It is also a reactive effort to show the results of marketing campaigns, investment in core technology and revenue results. This stage typically begins with the use of a marketing automation platform and the addition of a team member to be the technology specialists on the marketing team. Additional MO skills might come from other parts of the company and might include data, technology and integration knowledge, analytics, and reporting.

Stage 2: Proactive – Decentralized

A Proactive – Decentralized MO capability is characterized by the understanding of the need to develop this capability but not yet having full commitment to a budget or function. This stage typically begins with a lower level MO manager working to build a small team that works to optimize various marketing technology investments and to become more efficient and effective in their technology use. Some best practices emerge and foundational reporting develops. Some investment occurs. Recognition of what a full MO practice can deliver in terms of value to the firm happens in this stage and sets up for the next stage.

Stage 3: Proactive – Centralized

A Proactive – Centralized Marketing Operations capability is an economic engine for marketing. There is now commitment to a budget and a formal function. MO group has a leader that is more highly placed in the organization and is tied to the financial outcomes of marketing. This type of organization has broader responsibilities including campaign optimization, data analysis and insights, and working more broadly across key stakeholder groups such as product marketing, finance, and sales.

Stage 4: Strategic

A Strategic MO function serves as a source of data and insights for key leaders to make business decisions. The voice of the customer through data lives here and the process of gathering and sharing prospect and customer insights is credible and key to decision making at all levels of the organization.

The Relationship to MPM

As we all know, we love our acronyms. The first time I heard MPM or marketing performance management, my first thought was “This is interesting, but what does it really mean?” In working with Sam Mellnick and the team at Allocadia, it became clear how MPM fit into the MO reality I was researching and helping my customers construct. MO is responsible for the effectiveness and efficiency of marketing… a measure of how well marketing does their job. MPM is what MO leaders do. MPM guides their every day and helps them answer the question that drives their existence… How can I make marketing perform better?

Next Steps

As we look into 2017, the pressure for CMOs to demonstrate value to the business is at an all-time high. According to a recent survey from Deloitte, AMA and Duke University on CMO performance, only a third of CMOs report meaningful revenue-oriented metrics to the business. In order to close this gap, CMOs need to take 3 key steps:

  1. Shift the company-wide mindset that marketing is the pens and mugs department to marketing as a revenue-contributing department.
  2. Begin running marketing like a business.
  3. Invest in, and optimize, key technologies and skills to enable the complete transformation.

This is not easy, yet it is the only path forward for marketing. Marketing operations allows the CMO to run marketing like a business. Taking the time to become a student of MPM enables marketing to learn and adopt the discipline they need for success.

Rise of the Marketing Operations Function

The Marketing Operations role is evolving and transforming B2B marketing organizations. Have you wondered, what exactly is Marketing Operations? Why is it exploding within marketing? What do you need to know to stay ahead of this trend? How can you take advantage of these functions to create Marketing Operations as a hub of your department and continue on the path of Revenue Marketing?