April 19, 2022

Silos / Profit

Here's what the vendor tweet said:

  • "78% of CEOs expect marketers to grow sales, and you grow sales by tearing down silos."
These are the kind of comments that grill my cheese.

"Silos" of course are labeled by vendors as departments within "brands" that overlap functions. I'll give you an example. Back in 2002 at Nordstrom, I was in charge of Database Marketing, reporting to the CMO. Meanwhile, I worked with a peer, a VP in charge of Credit Marketing / CRM and Database Development. She built what was at the time maybe the best customer marketing database in the industry. She was also responsible for executing credit marketing promotions ... it was entirely likely that each week my team would send a marketing promotion for accessories to a customer and at the very same time her team would send a credit marketing promotion to use points on accessories to the customer. Complete and unfettered duplication of efforts.

Each of us operated in a Silo.

Vendors HATE it when "brands" operate via silos. Outside of the obvious "signaling" they do to communicate that "brands" are dumb, there are sales reasons for the contempt ... it's easier to sell to one person than to convince two people with similarly-aligned goals to agree to work with a vendor.

Vendors also provide solutions that allow for marketing integration ... they allow two "silos" to combine, with software executing "integrated" campaigns. If different departments are doing directionally similar things, well, the full capabilities of the software are not maximized.

The statement "you grow sales by tearing down silos" is so fundamentally flawed it is silly.

You grow sales by coming up with creative ideas that resonate with a customer to the point where the customer buys something from you that the customer didn't intend to purchase. Since that is really, really hard to do, we tend to gloss over it and focus on tangential nonsense that is easy to implement.

Creative ideas that increase sales at a rate that exceeds the cost required to implement the idea ... that's what profit is all about. Ignore when a vendor who has a sales team and a product development team (i.e. silos) tells you to change your org structure by eliminating the very structure they already employ when selling to you.

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