Carlson Marketing Boosts 'Return On Customer' Metric

Marketing strategies that stress long-term value over short-term returns will guide the development of meetings management services offered by Minneapolis-based Carlson Marketing Group, under a new global initiative headed by new president and CEO Jim Schroer. Marketing departments can provide a crucial balance to procurement initiatives in meetings consolidation drives and define policy goals, he said.

As successful meetings management programs already have reaped the low-hanging fruit of cost savings through consolidation, leveraging volume with vendors and technology, the industry has begun to look for more complicated returns. Now, meetings management programs must show long-term value to their companies, said CMG executives.

Schroer, who in May was named head of CMG, a sister company of Carlson Wagonlit Travel, is a marketing industry veteran. Before joining the company he served as executive vice president for global sales, marketing and service at DaimlerChrysler. Schroer has seen firsthand how marketing strategies create greater value for corporate meetings.

"One of the important roles in any strategic meeting is to present both the marketing side and the sales side effectively so that the meeting attendees come away fired up to sell more but also knowledgeable about new products," he said. "You have a whole new appreciation for the role of a meeting."

This year, CMG will promote the concept of "return on customer" as a metric for successful programs over more traditional return on investment measurements, Schroer said. ROC concepts can be applied to meetings management by labeling meeting stakeholders as the "customers." Essentially, a meetings management department is an internal service company and compliance with the program can be thought of as sales. Under ROC strategies, departments are held accountable for creating enterprise value, rather than short-term results.

"Basically, the ROC metric is measuring long-term staying power," he said.

CMG advises clients to involve procurement, marketing and sales in meetings management, Schroer said. "If you can bring that three-way optimization to the table, you can create big increases in market share for relatively low cost by running a great meeting."

"If you look across the success stories of customers that have deployed an enterprisewide solution for their meetings, it's those that partnered very strongly with their sales and internal marketing departments in outlining that process—the vendor selection process, designing the policy, the rollout and communication—the ones that were attempted solely by procurement didn't have the buy-in of the users," said Peter Moen, vice president of business development.

ROC marries procurement objectives with marketing objectives. For example, site selection should include criteria based on meeting content objectives, not just cost, he said. "Reducing expense is the easy part. Raising the return on that investment is the part that is going to make the difference between the winners and losers from an overall increase in earnings and long-term customer growth," Moen said. "ROC is a key tool to do that."

Procurement departments focus on cost, while marketing and sales "are a lot better at spending money than they are saving it," Schroer said. Both sides are critical, he added, with procurement bringing metrics and standard processes and marketing providing big-picture ideas.

"When the process is unbundled and you just have a focus that's too much on cost, you can run a meeting that costs less, but why have the meeting at all if people aren't going to sell more after the meeting?" Schroer said. "If you put too much emphasis on cost, you've completely shot yourself in the foot and you'd probably be better not running the meeting at all."

However, if procurement does not provide standard processes, meeting managers face the risk of "reinventing the wheel" for each event and costs will outweigh value, he added.

CMG also will invest in expanding its global services this year, Schroer said, as more of the company's clients standardize their overseas operations—including their meetings management.

"If you don't have a standard set of templates all over the world, you're going to eat up the cost of your meeting in admin costs," he warned. "Clients are beginning to adopt a set of great processes."

Procurement departments are leading the drive for global standardization in many business processes, Schroer said, including meetings management. It's the responsibility of senior management to apply three-way optimization in pursuing standard global processes, he said.

Senior management should realize the value of strategic meetings management, he said. "I don't know how you got to be senior if you didn't viscerally understand the enormous value of face-to-face meetings with your key people," he said. "There is absolutely no substitute when you're trying to motivate."