The History of Marketing Operations

marketing ops historyWhere did the “Marketing Operations” (MO) field get its start? It all depends on how one defines MO. The term first drew attention in 2005 after analyst firm International Data Corporation identified the rise of the Marketing Operations function in its annual Tech Marketing Benchmarks study.

In August 2005 Gary M. Katz published Marketing Operations: Solving Marketing’s Seven Deadly Sins on MarketingProfs. In November 2005, the Digital Asset Management and Marketing Operations Management Symposium in Los Angeles included a Marketing Operations Management track, created by Beth Weesner, Endaf Kerfoot and Kieron Osmotherly, and chaired by Gary Katz.

In June 2006, a standing-room-only crowd in Silicon Valley attended the Marketing Operations: How It Will Transform Marketing Forever roundtable, organized by Adrian C. Ott, chair of the Harvard Business School Association of Northern California. Panelists from Symantec, Cisco and BEA described best practices and how it worked in their organizations.

The first professional association focused on advancing practitioners and the field of Marketing Operations, the Marketing Operations Cross-Company Alliance (MOCCA), was established by Larissa DeCarlo of Hyperion, Chris Ewert of Adobe, and Mikel Irizar and Damon Moss of Symantec.

The first framework formally defining Marketing Operations as 5 Ts that support all of the marketing functions — total strategy, techniques and processes, tracking and predictive modeling, technology, and talent — was published by Adrian Ott in the Silicon Valley American Marketing Association’s Thought Leadership publishing contest: The 5Ts of Marketing Operations.

Marketing Operations as a recognized professional discipline may indeed be less than a decade old, but the industry developments and scientific innovations in the marketing field that gave rise to MO go back nearly a century.

Following are some of the key advances and influencers that provided the roots of Marketing Operations as it is practiced today.

Formative Underpinnings of Marketing Operations
1920s — The Golden Age of Radio spurred Market Research to help advertisers understand customer demographics and competitors. This led to market segmentation and targeting, a widespread practice in Marketing Operations today.

1931 — The consumer packaged goods firm Procter & Gamble (P&G) established dedicated Brand Management teams for an end-to-end view of products, markets, and customers. Today, in companies like Clorox, Brand Management and Marketing Operations are inseparable practices that strive to align brand messaging with brand performance.

1961 — The Marketing Science Institute was founded, advancing foundational marketing concepts and research streams, such as marketing orientation, brand equity, marketing ROI and new product development.

1974 — Peter Drucker, in his book, Management: Responsibilities, Practices, proclaimed that the aim of marketing is to “make selling superfluous, . . . to know and understand the customer so well that the product or service fits him and sells itself.” Today, companies like Autodesk, Microsoft and VMware are realizing that vision by integrating customer insight and business intelligence into their Marketing Operations scope.

1979 — The Institute of Management Sciences and Operations Research Society of America launched a series of annual market measurement and analysis conferences. Measurement and analysis today has evolved from a market focus to a holistic endeavor encompassing markets, customers, pipelines, campaigns, resources, processes, technology, teams and much more.

1979 — Computer Shopper Magazine invented “bingo cards” to track ads and notices from the periodical to a sale. This practice was adopted by product-focused trade journals in the late 1980s. Modern marketers have many more tools at their disposal to close the loop between initial impression and purchase.

1980s

  • Marketing textbooks added chapters on marketing metrics and organization structure, leading to big corporation experimentation with marketing ROI business models and marketing mix analysis, as well as the introduction of barcode readers, and database marketing.
  • Some public relations agencies adopted a business model aimed to guarantee results and be paid according to the “advertising equivalent value of publicity.” While this approach appealed to some executives who wanted their agencies to have more “skin in the game”, it failed to tie the resulting publicity to actual business results and caused incentives friction between PR professionals and journalists.
  • Marketing mix modeling was adopted widely among consumer packaged goods firms. Computer software was developed to model brand switching and consumer preference intent, using economic modeling such as logit analysis, which was invented by Bernsen in 1944.
  • The unveiling of electronic point-of-sale devices such as bar code readers began the marketing information revolution.
  • Database marketing became a driving force in direct marketing, with roots going back to 1967 when Kestenbaum Consulting was credited with developing new metrics such as customer lifetime value, RFM scores (recency, frequency, monetary), and applying financial and economic models to marketing.
  • Integrated marketing communications originated in the late 1980s and gained popularity in the 1990s.

1990s

  • Peter Senge’s landmark book The Fifth Discipline: The Art & Practice of the Learning Organization influenced executives’ thinking about systemic management and mental models, practices that are at the core of how Marketing Operations can enable integrated marketing from the inside out and transparent decision-making.
  • Bain & Company’s 1980s research quantifying the financial advantages of customer retention spawned strong interest in a closed-loop view of marketing results. Concepts such as brand equity, customer equity, customer value management, customer lifetime value, customer relationship management, and customer loyalty were embraced in the language of marketing. Demonstrating accountability for marketing resources also gained widespread interest at this time. Integrated marketing communications emerged to bridge the alignment gap between messages and imagery, content and supply chain, marketing investment and accountability.
  • Consumer packaged goods firms grappling with the complexity of stock keeping units (SKUs), bills of materials (BOMs) and channel management began to look to automating these cumbersome manual processes. Initially, large companies such as P&G and GE addressed this problem by developing proprietary solutions in-house.
  • Email marketing gained ground, and with it, privacy concerns grew. Invasion of privacy, and spamming complaints, led to the 2002 European Union Directive on Privacy & Electronic Communications and 2003 U.S. CANSPAM Act. Facing potential fines of up to $15K USD per individual recipient violation, marketers are influenced to change their e-mail “batch-and-blast” behaviors by more conscientiously focusing on respect (opt-in, opt-out, e-mail preferences), relevance (right content for right audience at right time) and relationship (placing customer buying journey at center of campaign strategy).
  • Commercial marketing automation software initially introduced by Unica (now part of IBM) in 1992, took its initial step toward mainstream use with the market entry of Aprimo (now part of Teradata) in 1998 and Eloqua (now part of Oracle) in 1999.

2003 — The term “enterprise marketing management” (EMM) became widely recognized with the publication of the book, Enterprise Marketing Management: The New Science of Marketing by Sutton & Klein.

2004 — The idea of combining process, metrics and technology into marketing practice was introduced in the book, The New Marketing Mission: How Process, Metrics and Technology Can Unleash Growth by Hastings, Wade, Duggal, Saperstein.

Formal Creation of Marketing Operations
2005

  • Analyst firm International Data Corporation identified the rise of the Marketing Operations function in its annual Tech Marketing Benchmarks study.
  • The first article citing Marketing Operations was published by Gary Katz in MarketingProfs: Marketing Operations: Solving Marketing’s Seven Deadly Sins.
  • Marketing Performance emerged as a hot topic with the publication of the book, High Performance Marketing: Bringing Method to the Madness of Marketing.
  • The Digital Asset Management and Marketing Operations Management Symposium, organized by Henry Stewart Events, was held in Los Angeles and included a Marketing Operations Management track, created by Beth Weesner, Endaf Kerfoot and Kieron Osmotherly, and chaired by Gary Katz. It was repeated in the fall of 2006.

2006

  • A standing-room-only crowd in Silicon Valley attended the Marketing Operations: How It Will Transform Marketing Forever roundtable, organized by Adrian C. Ott, chair of the Harvard Business School Association of Northern California. Panelists from Symantec, Cisco and BEA described best practices and how it worked in their organizations.
  • The first marketing operations consultancy was established, Marketing Operations Partners, by Gary Katz.
  • The first professional association focused on advancing practitioners and the field of Marketing Operations, the Marketing Operations Cross-Company Alliance (MOCCA), was established by Larissa DeCarlo of Hyperion, Chris Ewert of Adobe, and Mikel Irizar and Damon Moss of Symantec.

2007

  • The first framework formally defining Marketing Operations was described by Adrian C. Ott as 5 Ts that support all of the marketing functions: total strategy, techniques and processes, tracking and predictive modeling, technology, and talent. It was published for The Silicon Valley American Marketing Association’s Thought Leadership publishing contest: The 5Ts of Marketing Operations. This work was based on the 2006 HBS Northern California roundtable and her work in Silicon Valley. Later that year, the 5T framework was published to a wider audience in Marketingprofs where the framework has been subsequently published in several marketing books and adapted into marketing operations models and university classes.
  • The first benchmarking study, Journey to Marketing Operations Maturity, was published by Marketing Operations Partners and became the framework for marketing operations practice at many companies, including Walmart.
  • The Marketing Operations Efficiency & Effectiveness Conference was held in New York by Henry Stewart Events, with the Marketing Operations track chaired by Gary Katz. The same organization and chair held a similar event in Los Angeles, called the Marketing Operations Symposium, which was repeated in New York in May 2008.

2008

  • The first training course on Marketing Operations was conducted in Hong Kong by Gary Katz, who drove creation of the first conference focusing on the profession of Marketing Operations, The Marketing Operations Symposium, held by Henry Stewart Conferences & Events.
  • The first university-level course on Marketing Operations was introduced by Gary Katz at University of California—Santa Cruz (UCSC) Extension in Santa Clara, California.
  • Marketing Operations, in the context of Marketing Resource Management practice, was introduced for the first time in a book by Jansen & Riemersma, Marketing Resource Management: The Noble Art of Getting Things Done in Marketing. Efficiently.

2009

  • Marketing Operations as a strategic concept was featured for the first time as a chapter in a book, Marketing 2.0: Bridging the Gap between Seller and Buyer through Social Media Marketing by Borges.
  • Marketing Operations was featured as an essential enabler of Marketing Performance Measurement in the book, Marketing Metrics in Action: Creating a Performance-Driven Marketing Organization by Patterson.

2010 — The first online course on Marketing Operations was offered through UCSC Extension.

2011

  • International Data Corporation cited Marketing Operations at the fastest-growing profession in Marketing and the fourth most-staffed function of Marketing in large corporations.
  • Marketing Operations was credited as “The Marketing Technology Department” by research firm Sirius Decisions.
  • The blog MarketingGovernance.com was established to extend the influence and impact of the Marketing organization through the strategic practice of Marketing Operations.

2012 — The Marketing Operations Cross-Company Alliance established its annual Executive Forum.

2013 — The Marketing Operations Executive Summit was launched. Marketing Operations was cited as essential to establishing a Revenue Marketing Center of Excellence in the book, The Rise of the Revenue Marketer: An Executive Playbook by Qaqish.

2014 — A new conference, the Marketing Operations & Technology Summit represented the field more broadly than automation/analytics/metrics by others to-date, to include career path, capability-building, organizational agility, customer experience, and cross-organizational collaboration.

We’re excited about being part of the history of Marketing Operations as it unfolds and rises to new heights of influence in Marketing organizations.

by Gary Katz and Lynn Hunsaker, CEO and President of Marketing Operations Partners, respectively

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About the Author:

Gary was 1st to create a consultancy dedicated to MO (Marketing Operations Partners), 1st to publish an article on marketing operations (7 Deadly Sins of Marketing), and 1st to create a college course on MO (UC Santa Cruz Extension), 1st to teach a professional symposium on MO (Hong Kong), 1st to conduct a benchmarking study of marketing operations practices (Journey to Marketing Operations Maturity). See more at http://MOpartners.com/about

3 Comments

  1. Ian 2014/05/13 at 5:07 AM - Reply

    Here’s some additional details and stats from Gleanster Research on marketing operations technology adoption in 2013 – Check out the Gleansight Benchmark on MRM. http://www.gleanster.com/topic_area/marketing-operations. Top reasons to implement in 2013 remain operational efficiencies, brand consistency, and compliance challenges.

    I think one of the biggest challenges with marketing operations, even to this day, is a complete lack of consistency in how analysts, consultants, and marketers define the discipline and frame challenges. Is it a content management challenge? Is it a process challenge? Is it a digital asset management challenge? Is it a people management challenge, The answer is yes… and then some.

    Marketing decision makers generally know they have a problem with “marketing operations”, but how they frame that problem leads to very different ways to solve it. During my stint as a marketing operations consultant, we spent far more time educating senior management at Fortune 50 organizations about the need to re-think processes, how to justify the spend internally, navigating risk, and managing change than configuring technology. In fact, we salvaged more than a few marketing operations technology investments that failed to consider all the components of change (people, process, and technology). It’s never about the technology alone.

    But that’s what makes marketing operations such a dynamic concept; it’s a technology, it’s a discipline, it’s a role, it’s a framework and much more.. It’s the foundation of every communication, every strategic execution, every idea marketers come up with. Garbage in and garbage out. So while it’s not the most glamorous marketing subject (and it’s easy for CMOs to be distracted by things like social media, mobile, and the digital experience) marketing operations is the conduit for feeding the multi-channel strategy. The organizations that get it right establish unique competitive differentiators in their customer experience that win share of wallet. They are faster, nimble, efficient, and process driven – even on a national or global scale with tens of millions of dollars being allocated to marketing each year. That should be compelling for all organizations. It’s the difference between an orchestrated customer experience that can scale 5-7 years into the future and failure.

  2. Mayer G. Becker 2014/07/25 at 7:42 PM - Reply

    Good perspective Ian! It’s all of the challenges, and more!

    Marketing operations as a skill set goes all the way back to when marketing first became a discipline. The reason? Someone had to produce something – an advertisement, a piece of collateral, or later, direct mail or email. To do so, a marketer used project management skills, managed vendors, moved items through a production process, and took care of budgeting, billing and paying. All of us who became marketers had to learn to be “operators.”

    The first time I encountered “marketing operations” was in 2005 when I attended the Henry Stewart MOM Conference (Marketing Operations Management) in New York. I’m pretty sure Gary Katz was there! (Gary, please consider adding the Henry Stewart events to your timeline, as it brought Marketing Operations to the fore.) It was around that time that IDC coined the phrase “marketing operations” – and finally a name was associated with what we as marketers have been doing for many decades.

    I always thought of marketing operations as a strategic role within a corporation, reporting to the CMO and broadly being a chief of staff and head of planning, budgeting and process improvement (among many things). In the past 3-4 years, as marketing automation has come of age, the marketing operations function has taken over technology, and in many companies, has become more tactical in nature, no longer necessarily reporting to the CMO.

    The discipline continues to evolve and grow.

  3. Lynn Hunsaker 2015/01/15 at 3:53 PM - Reply

    Thanks for your inputs, Mayer and Ian, and so many others who wrote me personally. The updated content for Marketing Operations on Wikipedia is now live: http://wikipedia.org/wiki/marketing-operations

    Looking forward to continuing to make history in the marketing ops field!

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