This playbook outlines operational marketing leadership during challenging and uncertain times
We are living in complicated times, with many challenges. A global pandemic, the war in Ukraine, massive supply chain disruption from the pandemic and war, high inflation across the globe, a massive stock market correction, and last time I checked, we still had murder hornets.
Marketing leaders must be ready to quickly adapt their plans to react to business performance and market conditions. This type of agile planning is especially important in times of high volatility.
Leading through challenging times is not easy. Marketing leaders must address challenges head-on and be ready to quickly adapt their plans to react to business performance and market conditions. This type of agile planning is especially important in times of high volatility.
This playbook prepares you to lead marketing teams through challenging and uncertain times. It helps your team to rapidly adapt your plan while delivering overall improved plan performance.
Below, we discuss the following steps marketing leaders should take when planning for times of uncertainty and challenges:
- Re-validate your plan assumptions.
- Optimize your plan.
- Create plan scenarios.
- Implement changes clearly and deliberately, and communicate the rationale.
Step 1: Re-Validate Your Plan Assumptions
During “normal times”, I recommend that you validate your plan assumptions every quarter. Given the current environment that has brought challenges and uncertainties in business, it is recommended that you have a formal review of those assumptions every month.
The following assumptions should be part of your marketing plan:
When building a plan, I like to document the key external factors that could influence my plan. For example, will changes in the industry or the market impact your plan? During the pandemic, industries like retail and healthcare saw a dramatic change in how they interacted with their customers and patients.
Start your assessment at a high level - have your primary marketing objectives changed? For example, have you shifted the emphasis from growth to profitability? Have you decided to push out your visibility campaign or your product launch? Starting with the broadest assumptions will help you determine any significant changes you need to make in your plan.
Metrics, targets, and milestones
Once you have validated your goals, you should document whether your targets have changed for those goals that are still part of your plan. Have your pipeline or revenue goals changed? If sales goals have changed overall, how does that affect the marketing contribution toward those company metrics?
CPO, conversion rates, ACV, margin
You should have documented your expected cost-per-outcome (CPO) metrics at the beginning of the year. Those assumptions may have changed given overall market conditions or changes in privacy that can affect ad delivery. Same thing for your funnel conversion rates, your average contract value (ACV), and even your margin assumptions. All of these factors can make a major difference in the profitability of your marketing investments and your overall plan performance.
Has your budget changed in the last period?
In some cases, you may even change marketing strategies given major shifts in your plan. This was the case during the pandemic when people who have an in-person event strategy (trade shows or seminars) or a customer hospitality strategy (like sponsoring Formula One or a PGA event), needed to make dramatic changes to their strategy.
Step 2: Optimize your plan
Regardless of any changes in your marketing plan assumptions, it is important to run a plan optimization regularly. Like the assumptions validation, it is recommended that you do an optimization monthly during challenging times of higher volatility and quarterly during “normal” times.
You get two primary benefits from running this optimization play: first, you get a better plan. And second, your plan is ready for rapid adaptation because you have identified the things you would most likely change in your plan.
Follow these steps to optimize your plan:
Identify your MOST efficient campaigns
Measure your highest-performing campaigns by cost per outcome (CPO) or return on investment (ROI). In uncertain times, leaders can start with the positives, so finding those campaigns in a plan that deliver the best performance is a great way to start. I like to consider both relative performance and absolute performance when I am doing this assessment.
For example, you might have a campaign that is delivering a 10x ROI, but it is delivering a very small amount of revenue. Alternatively, you could have a campaign that delivers a lower return (as long as it is positive), but is a major contributor to your revenue results. You should tag these campaigns as “invest” in your plan.
Identify your LEAST efficient campaigns
The other side of the coin is to identify low-performing campaigns, as measured by cost per outcome (CPO) or return on investment (ROI). For campaigns delivering a lower return on investment, especially those that are delivering a negative return, you should tag these campaigns as “divest” in your plan. This is a great next step to take for marketing leaders to plan for uncertainty in business environments.
Figure 1: Using Campaign Performance View in Plannuh to find the highest and lowest performing campaigns
Isolate flexible campaigns that can scale (in both directions).
Once you have made your performance assessment, the next step for marketing leaders is to review your campaigns for scale. Not all campaigns are scalable, but some can easily be scaled up or down in times of uncertainty.
For example, campaigns that have a large digital media component can easily be scaled. Even some physical campaigns like a roadshow of events can be scaled by adding or removing stops in the roadshow. And major, integrated campaigns, like a big product launch, can typically be scaled up or down by adding or removing components to the plan. Tag the campaigns with “scale” in your plan.
Highlight areas of unplanned spending.
One underutilized optimization strategy for uncertain times is to look for unplanned spending within a budget. Those are the areas where you have earmarked spending but haven’t made a specific plan. Your product marketing team may have made some assumptions about spending on analyst reports, and your field marketing team may have made assumptions about trade show swag. Finding unplanned areas creates an opportunity to invest more in those higher-performing and scalable campaigns.
Figure 2: Identifying unplanned spending in Plannuh
Review and make adjustments.
When making adjustments to your plan, start by finding areas where you can reduce spending (like low ROI campaigns) or recapture your budget (unplanned spending). Once you have identified your changes, you can decide how much can go to higher-performing campaigns and how much should be returned to the company.
Following these steps will allow you to optimize plans better to be more effective in times of uncertainty.
You should make these adjustments to your plan even if you aren’t forced to because of budget cuts. The best marketing leaders optimize their plans without being asked.
Step 3: Create plan scenarios.
Now that you have an optimized plan, the next step is to build some plan scenarios, so you are ready to adapt to uncertainty and unforeseen challenges. The approach I like to use is to do the following:
- Pick a range of spending. Start with a plus/minus range you would like to use for your scenario model. For example, you could decide you want a +/- 20% plan.
- Build your plan at the base case. Start by building out your plan at the low case, this will force you to make the tough decisions about what not to do.
- Build your incremental investments and assign results. Next, you want to build in your list of incremental investments. Make sure you identify the outcomes you expect to achieve with the incremental investments.
- Group the investments by scenario. Once you have your list of incremental investments, then you can tag them in your campaign by scenario. Try using “base case” for your mid-point case and “investment case” for your higher investment.
- If you are using Plannuh, you can create the campaigns and “end” them, so they don’t use any of your budget. When you are ready to activate a case, simply filter for the case and activate the incremental campaigns.
VIDEO: Creating scenario plans in Plannuh
Step 4: Implement changes clearly and deliberately and communicate the rationale.
When you are ready to roll out your changes to the plan, it is important to communicate the rationale behind your changes and the expected results. Consider the following approach:
- Communicate your optimization strategy upfront. Before making any changes, ensure you have a clearly defined approach to optimization. Defining the process up front will take some of the emotion out of the decisions and can enlist your entire team in the optimization process.
- Provide context for any changes. If you are making cuts in your plan, explain the rationale. For example, you may see softness in your business or a renewed emphasis on profitability vs. growth. If there are no cuts, make sure that you let people know this is a standard part of your optimization process.
- Re-publish the plan so everyone is working on the same version. Make sure that everyone is fully aware of the new plan. If you are using Plannuh’s marketing planning software, simply archive the old version of the plan as read-only and make the new scenario the live version of the plan. If you are making major changes, walk the team through the changes in detail to make sure everyone understands what has changed and why it changed.
- Celebrate optimization. Don’t forget to celebrate and award optimization! Recognize those campaign managers who delivered great results and those who contributed to the optimization by reducing the investment in their campaigns to improve the overall marketing ROI. Creating a culture that rewards optimization will pay dividends for your organization and the company in the long run.
Planning for Challenges and Uncertainty in The New Normal.
Given the pace of change in marketing, it is unlikely that things will stay stable and predictable. Embracing the fact that change is inevitable and building optimization into your operating rhythm, you will deliver better results and sleep better at night at the same time.