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How Does Lean Apply to Marketing?

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Wikipedia defines "Lean", as

  • "A production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination."

The American Marketing Association defines "Marketing" as

  • "A set of processes to create, deliver and communicate customer value and manage customer relationships.”

Common to both definitions: "process" and "customer value."

In many companies, marketing is thought of as a collection of functions such as market research, marketing communications, product development, lead generation, trade show management, etc. The functions are obviously necessary, but there is rarely much thought about how they fit with other business functions (such as sales), or how their effectiveness can be measured or improved.

For example, faced with the need to start planning for a trade show next month, managers have little choice but to preside over an absurd and ugly waste of resources. How can they overcome the loud voices claiming "If we do not exhibit, customers will think we are going out of business," or "We got a big sale from attending that show two years ago." Similar arguments can be made for everyone’s opinions on what marketing activities are worthwhile.  Lean and process thinking can reign in the irrationality of marketing by committee.

The Marketing and Selling Production System

Perhaps the greatest contribution of the Lean and process excellence to Marketing (and selling) is the idea of systems thinking: This approach requires you to define the purpose of your production system so you can identify work that adds value and distinguish it from waste. The purpose of sales and marketing is to generate a stream of customer orders for what you can produce, when you can produce it. These customer orders are the culmination of a long series of actions prospects and customers take from before they ever hear of your company or the kind of problems you can solve to when they become regular, happy customers. Anything that encourages the right prospects and customers to give you their attention, their information, their time, and their trust adds value. Anything that does not adds waste.

Marketing consultant Bud Hyler is fond of saying “Marketing is to sales as engineering is to production.” In this analogy, marketing is responsible for strategic as well as tactical kinds of work, similar to engineering.

The strategic work (such as portfolio management, market research, product / service development and commercialization, and brand management) might be compared to research and development engineers do to design their primary physical production plants and logistical systems.

Marketing conducts research to learn where their best customers are in the market, what those customer’s value (attributes) so this information can inform decisions about how to communicate that value, and for its systematic delivery to the customer experience. For example, Cargill Meat Solutions prints ICONs depicting "Cold, Clean, Correct, and On-Time" on each box of beef they ship (a clear brand promise desired by the market). When customers let them know they were not meeting these expectations, "Lean" thinking was applied to shipping operation to justify automation that leveraged improvements that exceeded expectations. The system allowed them to get ahead and stay ahead of competitors in delivering critically important value attributes to the customer experience. As a result Cargill commands the highest margins in the industry (by far).

These strategic activities lead into tactical execution (such as SEO, lead generation and nurturing, trade shows, content production, and prospecting, etc.). These might be compared to the manufacturing engineers who constantly tweak the productivity of production operations and equipment based on feedback from workers as well as market needs.

Basically, anything customers or salespeople repeatedly ask or do is a candidate for automation. You want to conserve salespeople’s (and customer’s) time for things that cannot be automated. In addition, the flow of inquiries, leads, and sales opportunities must monitored, especially if market communications are not sophisticated or well targeted. For example, a recent survey by CEB Marketing Leadership council found that “on average customers progress nearly 60 % of the way through a purchase decision-making process before engaging a sales representative.”

The implication is that a poor showing online may reduce the number of prospects who will make contact with your sales force. The information you want prospects and customers to know must be delivered in the way they want to consume it, i.e., in sync with stages of their buying process. If your website just tells readers what you do, that's not enough. You must help them understand why they should select your company to help them solve the problem they are facing. To do this you must "position" your offering. Who you are, what you do, why you're better, and who says?

If site visits are down and blogs are not read your content is not creating value for prospects or customers. If your website or other content helps them get info they need to solve their problems they will give you their contact information. Thinking of marketing and selling as a production system instead of as separate functions can elicit measurable responses that inform subsequent decisions about next steps that will help move the lead towards a sales conversation.

In lean marketing, that which does not create customer value (i.e., actions along the customer journey) is waste or MUDA, and should be ignored or eliminated. Marketing is responsible for learning and understanding the attributes customer’s want, and for delivering offers they can respond to in order to measure, analyze, and inform next steps. This makes it easier to identify what is valued (in content or sales approach) so it can be exploited to find, win, and keep more customers before competitors get wise. It also makes it easier for managers to “see” into the progress of the customer through the stages of their buying process.

The world’s most innovative companies (Apple, 3M, Samsung, GE,) tend to treat marketing as a structured, repeatable process they can use to achieve desired outcomes consistently based on measures of customer value. For them marketing is an ongoing, continuously improving process, and so it should be in your company as well.

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