Marrying Ops and Marketing

Your operations workers aren’t just fulfilling customer orders; they’re fulfilling your company’s marketing plans and communicating directly with the customer.

To ensure that the ops team succeeds in carrying out the marketing team’s mission, open communication is critical. The marketing staff is often unaware of the constraints inherent in the back-end environment, notes Terry Knoploh, vice president of sales and marketing for Burnsville, MN-based tool cataloger Northern Tool. “It’s about educating the marketing group on what affects the back end and creating an environment that encourages communication,” he says.

For example, during the holiday season the marketing department at Northern Tool generally wants to promise next-day delivery as close to Christmas as possible, Knoploh says,“with no eye for what my capacity is for that day.” To avoid promising a service that cannot be delivered, Northern Tool’s marketing department discusses with operations its goals for volume fulfilled and sales before launching a marketing initiative.

In fact, interdepartmental meetings are one way that operations can explain to marketing the extra work that certain offers or promotions entail. Sharon Currie-Mills, senior vice president of operations, consumer products division for Silver Springs, MD-based Discovery Channel Catalog, recalls that last year the creative team and the marketing department decided to expand their gift-wrapping options for holiday 2003. The educational gifts marketer decided to offer children’s and adult’s gift wrapping with a choice of ribbons or bows and personalized “to” and “from” messages. This diversity of choice meant 16 combinations of gift packaging as opposed to the one type of wrapping offered in previous years. To carry out the marketing plan, Currie-Mills says, the operations team needed to devise and distribute a complex diagram featuring every conceivable combination of gift-wrapping request.

Operations was able to handle the challenge, but Currie-Mills let the marketing department know the difficulty of following through with the concept. “We had the senior vice president of marketing and our chief operating officer look at the diagram,” she says. “They got that it wasn’t as easy as they thought it was.”

The benefit of regular meetings

Discovery Channel holds meetings between the operations and marketing departments at least twice a year. The operations department, based in Florence, KY, travels up to Silver Springs, where the marketing team works, for one meeting, and the marketing staff travels down to Kentucky for the other meeting.

When the marketing team is in Kentucky, Currie-Mills says, the executives are put to work in the warehouse and the call center. This gives the marketing employees, who tend to work on a conceptual level, a chance to see what is involved in following through with their ideas.

At Northern Tool, a representative from operations, such as the warehouse supervisor or the call center manager, gives a presentation to a few marketing executives every quarter. During these presentations, operations managers discuss departmental goals, such as going from 26-hours average shipping time to 23-hours average shipping time or an effort to consolidate all of the picks for more of the orders so that they can be shipped together to reduce the number of boxes shipped.

During the other quarterly meetings, marketing presents its goals for promotions and circulation to senior executives from the operations department. And once or twice a year Northern Tool’s operations and marketing managers present their goals to top company executives.

“It’s about maintaining a team-oriented approach, staying away from the blame game, focusing on fix and moving forward rather than looking back and blaming,” says Knoploh.

Measuring the true costs

Meetings between marketing and operations can demonstrate to the former any additional back-end costs that may be incurred in implementing their promotional plans. When Northern Tool’s marketing department shares its sales goals with the ops team, for instance, the warehouse and call center leaders can determine if they’ll need to add call center representatives or packers to meet the goals, Knoploh says, which in turn could cut into profit.

Currie-Mills says Discovery Channel’s marketing team once came up with a plan to include a flashlight in every fourth children’s order. She had to remind them of “hidden” costs: increased shipping costs if the packages with the flashlights weighed more, overtime pay for warehouse workers who would have to manually select every fourth children’s order, as the computer system didn’t have the capability of making an automatic “pick” for the selected tickets.

“I never want to dampen marketing,” says Currie-Mills. “I just think operations needs to go back and give a realistic view of what the costs will be.”

Keep ’em posted

Thorofare, NJ-based office products cataloger RapidForms actually requires formal approval from operations before promotions and new catalog editions are permitted to go forward, says vice president of marketing services Tom Jule. What’s more, the head of the call center and one or two call center representatives proofread all new advertising material, such as pages added to the catalog and ads offering discounts.

“It’s not just about finding errors,” says Jule. “It’s about learning way ahead of time about things that are coming down the pike.”

Terry Jukes of Fort Lauderdale, FL-based direct marketing consultancy B-to-B Direct Marketing Intelligence suggests keeping a bulletin board in a common area, such as the cafeteria, and using it to post copies of mailings going out or in development. That way operations won’t be caught off guard with questions from customers about a new promotion, such as a discount on a particular line of merchandise. Weekly companywide e-mails with information on mailings to hit the market that week also work, Jukes says.

The marketing department at RapidForms provides the operations department with detailed descriptions behind every key code, says Jule. “We put a lot of care into making sure that the description is accurate and careful.” So when a rep types in a particular key code he will see, for example, that the catalog the customer has in hand a 20% discount offered or that version of the catalog was mailed only to people in a particular location.

Another way to create structure in the relationship between marketing and operations is to have standard operating procedures in place that marketing knows they must work around when creating a promotional plan, says Jukes. For example, he recommends consistency in establishing a daily cut-off time for promising next-day delivery. The cut off might be 4 p.m., for instance, if the last parcel carrier pick-up is at 6 p.m. Having this kind of information will prevent the marketing department from making delivery promises that operations will have difficulty fulfilling.

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