Monday, November 29, 2010

Study Finds Blind Spots in Go-To-Market Process Limit Demand Chain Performance and Revenue Optimization

A new study by the Chief Marketing Officer (CMO) Council reveals significant blind spots in the go-to-market process as marketers focus on strategy, creative development and campaign execution to the detriment of effective demand chain provisioning. The latter includes the efficient and timely delivery of marketing and merchandising materials to dealer, agent, franchise, retail and brand office locations, as well as the processing of customer requests for sales literature and samples through web, call center and email channels.

According to the report, entitled Competitive Gain in the Demand Chain, many marketing executives admit they have never assessed demand chain performance, nor given it high priority within the marketing operational mix. This may be contributing to the belief, expressed by 80 percent of respondents, that their organizations are not efficient or effective enough in provisioning all of the demand chain. A surprising 20 percent of more than 250 marketers audited by the CMO Council in the past three months admit their demand chain is under-performing or in need of improvement.

Marketers agree that demand chain provisioning is critical to business competitiveness and performance (38 percent of respondents), while an additional 31 percent believe it is important to sustaining sales and channel operations. Yet, only 25 percent of respondents are ensuring sales support materials and resources are delivered on-demand, which would improve sell-through and customer conversion. Only 15 percent are taking steps to audit and assess marketing supply chain effectiveness, indicating that there is little to no visibility into the demand chain provisioning process to truly gauge content, material or operational impact and performance.

While 56 percent of marketers are focused on campaign design, development and execution, only 16 percent are looking to production, warehousing, inventory management or delivery as critical elements in an effective demand chain. In addition, just two percent are looking to optimize the actual delivery, fulfillment or distribution of their critical marketing materials.

One area that potentially holds an immediate opportunity for improvement and value creation is specific to vendor selection or management. Nearly half of respondents view demand chain procurement and fulfillment as a compilation of individual vendors, asking each vendor to bid on individual elements of the demand chain. Only seven percent of marketers view the demand chain as an area for consolidation and rationalization to gain more control and efficiency. As nearly 60 percent of respondents plan on introducing a more disciplined approach to marketing execution systems, vendor visibility is likely an ideal place to begin demand chain transformation.

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