Sunday, December 4, 2011

It's Time to Fix the Marketing Supply Chain

Improving the productivity of the marketing supply chain probably won't be near the top of most marketers' list of new year's resolutions for 2012. Marketers are facing extraordinary pressures to drive increased revenues and maximize the return produced by every dollar invested in marketing. So, it's understandable that they focus most of their attention on developing more effective marketing campaigns, creating more compelling content, and generating more qualified sales leads, rather than on "mundane" issues like the production and distribution of marketing consumables.

In reality, however, the marketing materials supply chain represents a large, and largely untapped, source of both cost savings and revenue-enhancing improvements. The marketing supply chain in most companies is highly fragmented and filled with manual, inefficient processes that result in excessive costs and a lack of both responsiveness and reliability. If not completely broken, the average marketing supply chain is dysfunctional and in serious need of repair.

Research by the Chief Marketing Officer (CMO) Council and Forrester Consulting (part of Forrester Research) shows both the economic significance of the marketing materials supply chain and the opportunities for improvement.
  • A majority of companies spend at least 20% of their marketing budget on marketing consumables, and almost a third of companies devote at least 30% of their marketing budget to such materials. (CMO Council)
  • Four out of five companies distribute marketing collateral documents and similar materials to salespeople and other sales channel participants, and a majority of companies distribute such materials on at least a weekly basis. (22% distribute on at least a daily basis) (Forrester Research)
  • Just 25% of marketers have performed a comprehensive analysis of the costs and process efficiencies in their marketing materials supply chain, and only 11% have implemented new workflow systems to reduce costs and inefficiencies. (CMO Council)
  • Fifty-nine percent of salespeople and other sales channel participants still rely on e-mail to request marketing materials, and nearly half (47%) still rely on telephone requests. (CMO Council)
  • Sixty-five percent of salespeople say they over-order and stockpile marketing materials because it takes too long to receive ordered materials. (CMO Council)
  • Only 17% of companies are using eStores or sales portals to support their marketing fulfillment process. (Forrester Consulting)
The good news is that companies no longer need to tolerate an ineffective and inefficient marketing supply chain. Marketing asset management technologies, combined with on-demand manufacturing capabilities and state-of-the-art warehousing, inventory management, and fulfillment services, can eliminate waste from the marketing supply chain, while simultaneously improving responsiveness and reliability.

To determine how much your company would benefit from an improved marketing supply chain, you need to perform a comprehensive audit that identifies the strengths and weaknesses of your current supply chain. Such an analysis will also enable you to quantify the cost savings and other benefits that an optimized supply chain would provide. You'll probably be surprised by the results. Even in relatively small companies, we've seen benefit values that reach well into six figures.

We've developed a process for quantifying the major cost savings that a "marketing asset management solution" will produce. This doesn't take the place of a comprehensive supply chain audit, but it is a good way to begin your evaluation. If you'd like to see a sample version of our cost savings calculator, send an e-mail to ddodd(at)pointbalance(dot)com.


  1. Nice post David. As you say: "Who wants to deal with the mundane world of collateral management?" I've always been enthralled with promotional material, and was involved significantly in the digital printing industry from its advent. Digital printing was supped to solve the "collateral abuse" you speak of. But without management ... well, you know the answer.

    I've witnessed promo material mismanagement on each of your above points. If I may though, I'd like to add one more: trade
    show collateral.

    First, assuming your promo material was even distributed at the show - it ends up in a bag with a hundred others from "who knows who." That's assuming it's handed out. A lot of promo, printed specifically for the trade show - ends up in the dumpster at the back of the exhibit hall on Sunday afternoon.

    Collateral management is as much communication as anything. The tools are there, the hard part however ... is getting everyone to use them.

  2. Clay,

    Thanks for your comment. I completely agree with you that a great deal of waste is associated with trade show collateral. I remember seeing Graph Expo attendees leaving the show carrying bags filled with collateral materials. I wonder how much of it was ever read.

  3. Portals are the logical answer to the problem of supply chain management. However, to engage and drive use of Portals you must consider all processes. Take the routes to the ordering of the collateral for example. Why is the Sales person picking up the phone to order? Is because that’s what they’ve always done and can still do it the same way? You must make it easy to go through the Portal while at the same time avoiding leakage orders through back channels. You have to be accessible with the right collateral.

    With investment in technology and the appetite to drive it, combined with the understanding of marketing process, the management of the marketing supply chain can be streamlined effectively. To deliver the right collateral, to the right people when they need it, you must know your processes.