The Five Pillars of Marketing Transformation

Over the past few years, SAP has succeeded in the art of marketing; developing clear
branding strategies that boost brand recognition, credibility, and buying intent. Now, the
focus should be to thoroughly codify a plan that will constantly direct SAP Marketing to
achieve SAP's overall organisational objectives. To do this, SAP must build a forum that can
successfully combine art and science of marketing. The SAP Marketing Team will need to
strive to enhance its attempts to collect data and obtain intelligence in order to comprehend
customer needs and improve its outreach to them. The following five pillars are proposed for
this reason.

Humanize the Brand

Cultivate a customer-focused mindset that seeks to: help SAP reach new audiences; explain
how SAP provides real benefits to its customers and society; establish trust between its
users and stakeholders; and motivate advocacy. The goal should be to get all 54,000 workers
to be brand ambassadors and to transform the way they share the tale of what SAP is doing.
SAP should be transitioned from what has been seen as an extremely conventional,
conservative, closed business into a transparent, creative, accessible entity that can play on
the world arena of industry as it moves through the contemporary world.
In addition, much of the conversation on SAP 's platforms should come from outside sources.
Beyond just publishing customer reviews, SAP can interview customers, collaborators and
users and integrate their direct words and experiences into its core traditional and digital
marketing activities.

Develop Pull marketing

This reflects a shift in thought to turn SAP from a conventional sales-driven viewpoint to a
consumer-driven perspective. The goal is to understand how customers may choose
to consume SAP products and services and also to encourage them to engage with SAP
where, where and how they want to do so. In order to achieve this, SAP should create and use
marketing channels that will encourage people to engage with SAP and talk about their
experiences in whichever way they like to. To get going, SAP should concentrate on adding
more exciting content to all of its digital platforms. SAP should create a theme-based website,
linking to the company's key market, but packed with content that is a combination of SAP
staff written work and selected content produced by external experts and customers. External
voices can help introduce potential customers to the website, as well as put users into touch
with SAP through organic online searches for more generalised knowledge on technology, IT
solutions, and market processes. This forum would not only provide one-to-one contact and
assistance to and from key SAP stakeholders, but it would also provide SAP a content farm
of interesting content and insights that could be integrated into its marketing activities.

Simplify Marketing
SAP should simplify the framework and operational process of SAP Marketing with a view
to: making the most effective use of its spending plan; enhancing the exchange of knowledge
and expertise around the company; and allowing more bottom-up decision-making. Its
primary objective should be to establish a more effective internal marketing operating
system, partly motivated by SAP 's marketing understanding of the challenges confronting all
marketers to develop insight-driven marketing strategies. For SAP, this initiative should
include capturing and extracting data produced when consumers engage with every SAP
marketing point of contact (live events, workshops, online material, social media).
SAP can automate this process with algorithms that screen out low-probability interactions –
such as academic research paper information. The software should also collect any SAP
source of data that the contact is aware of in order to decide the necessary follow-up
information that should be immediately sent to the contact. A follow-up call can only arise if
the algorithm recognises a communication as having an extra-high interest and ability. Also,
without the availability of contact information, the framework should also look at all other
empirical data generated from website traffic and social media visits. Such efforts can
contribute to an assessment that a collection of SAP content has been viewed from a specific
ISP address. If the ISP is licenced with a specific entity, it would be suggested for a follow-
up call back from SAP to determine if the enterprise will still be interested in certain SAP
product or service.

Tighten the business-links

SAP should change from an evaluation model that credits marketing strategies to a model that
credits the accomplishment of a company result, thereby providing a direct correlation
between marketing and total ROI for SAP. SAP should delegate more power and profit and
loss of liability to mid-level managers with geographic or line-of-business roles and re-adjust
marketing expenditure every quarter as the marketing team collects information and metrics
on the business performance.

Invest in people
A major internal agenda of SAP should be to improve the expertise and experience of SAP
Marketing staff and to build a community of common visions and priorities. A work rotation
schedule should be implemented to allow SAP Marketing staff to become more acquainted
with operations beyond their core roles, and a mentoring network should be developed to
disseminate skills around the company and help new staff speed up their learning curve. The
SAP Marketing Team should also set up its own internal online network to encourage
engagement and information sharing.

Setting the KPIs

(Gas required as intro)

Return on Marketing Effectiveness: This analyses the overall marketing costs (people and
programme) against the revenue raised by the marketing spearheaded, eligible leads which
have been converted to sales and have been real transactions. Any marketing initiatives that
may affect the production of revenue indirectly are not credited in this KPI, e.g. the situation
when the consumer saw SAP advertisement or other promotional materials and first made
direct communication with the SAP sales agent rather than via the SAP marketing platform.
Conversion Rate: A metric of the total number of qualified leads produced by marketing and
forwarded to sales relative to the total number of such leads that were ultimately booked and
won. This offers an evaluation of the pace at which marketing generates successful sales
prospects, regardless of the amount of revenue produced by the transactions made.
Audience Engagement: A metric intended to monitor engagement with SAP content (e.g.
Facebook Views, social media feedback, retweets, etc.). This metric incorporates content that
produces a committed response from both push (e-mail, direct marketing, ads, etc.) and
pull channels (social media messages, organic visits to the SAP website)
Marketing Expense as a Proportion of Software and Software-Related Resources
(SSRS): This is part of the business links pillar, as it is an indicator of SAP's total revenue
generation proportional to marketing expenses.

Budgeting
Sales and Marketing expense includes direct sales costs, personnel costs, and the costs
incurred to market the products and services. In 2019, the sales and marketing expenses rose
13% from €6,781 million to €7693 million. The ratio of sales and marketing expenses to total
revenue also rose to 27.9% in 2019. The increases were mainly due to the expansion of global
sales force, acquisition of Qualtrics, and also due to bonus payments offered because of
strong revenue growth.
Considering the plans of the company, and the related growth factors, the cost ratios of the
company are expected to decline in 2020. Further, along with administration costs, sales and
marketing costs are likely to decline by 5% to 10%. Following are the two scenarios:
Scenario 1- Optimistic: Marketing expense (decrease by 5%) – €7308 million
Scenario 2- Pessimistic: Marketing expense (decrease by 10%) – €6923 million