The name is synonymous with “innovation”. Since it’s founding in 1970, this research center has pumped out a wealth of ground-breaking inventions: laser printing, Ethernet, the graphical user interface (GUI), object-oriented computing, and so much more. Spun-off in 2002, PARC (as it’s known today) is squarely in the business of developing new breakthroughs in technology for commercial and government partners including Xerox.
What can a research think-tank like PARC teach B2B marketers? Quite a bit.
Last week I had the wonderful opportunity to attend the ITSMA Marketing Leadership Forum in Napa. While CEO Dave Munn and company put together another spectacular agenda (you can review the tweet stream at #ITSMAmlf12), that they asked Lawrence Lee, PARC senior director of strategy, to talk about how to become and stay innovative was an insightful move.
Sure, I happen to enjoy office space at PARC and to hold a warm spot in my heart for this Silicon Valley institution. But let’s walk past my little biases for a minute. Lawrence’s talk was particularly relevant to B2B marketers because good CMO’s spend a lot of time collecting and sharing customer insight. By studying customer behavior and pain points, good marketers uncover non-obvious opportunities to solve problems and create new business – like researchers at PARC do.
To achieve this, Lawrence explains, it’s important to create a learning mindset in marketing where taking calculated risks is part of the culture. PARC manages research projects like a good VC or stock broker manages a portfolio of investments. Top marketers today must also manage a portfolio of activity aimed at increasing consideration and deal opportunities. Fundamentally, both activities are pretty similar.
In the digital age, the marketing portfolio has become quite broad. Many marketers struggle to find the right combination of program tactics that move the needle on demand creation and sales enablement. It’s never one particular approach – like creating a Facebook page, buying the right email list, or running a world-class event or Web seminar – that brings in the prospects. Instead, marketers make the biggest impact when they take a consistent, investment-oriented approach to engaging customer and use different elements of the marketing mix to target buyers at different stages of the purchase cycle.
Using the figure shown here, Lawrence shows how PARC categorizes projects in four distinct risk/reward profiles. This helps PARC balance its need to make new breakthroughs against the requirement to drive new business. Marketers should take a similar approach to deciding which marketing programs to pursue and which to abandon. The matrix of risk/reward criteria for marketing may look slightly different, but each quadrant should include activity dedicated to:
- Core – engaging with current customers to keep them well-informed, engaged with your company, and advocating for you.
- Next-Gen – looking for new opportunities to cross-sell or upsell current customers and continue to add value to your relationship.
- Scouting – building awareness, consideration, and trial with net-new customers for your existing products and services.
- Options – investigating new opportunities in break-out, brand new markets that complement where you are now.
Determining what percentage of the marketing mix to dedicate to each area is an important consideration. I recommend you put a healthy dose in Scouting, with Core and Next-Gen following. Never completely overlook Options, however, because new opportunity is often where true growth gets started.
It was fascinating to see SAP CMO Jonathan Becher’s presentation the following morning where he showed how SAP puts the innovation portfolio concept into practice. Based on technology from an acquired company, Jonathan demonstrated SAP’s marketing dashboard that provides an online way to view, manage, and communicate activity health across marketing programs by region. This dashboard also helps to show the impact the tracked campaigns have on the pipeline. Whether he intended to or not, Jonathan mixed together the PARC theory with SAP practice to really make the agenda hit home.
There were many other presentations — on balancing the demand generation equation, using simulation games to get to know your buyers better, creating stories, short messages and online demonstrations to embrace the customer perspective, and navigating the uncharted waters of marketing transformation — that were equally interesting and informative. Thanks to all the great speakers and attendees at the ITSMA Marketing Leadership Forum. Your participation made it one of the premier events for me this year.