The marketeers’ primary role is to facilitate more sales, to more customers, more frequently, at higher margins, and in a way that you deliver real value to the customer.
With markets shrinking, costs rising and competition intensifying, the marketers’ job has become tougher than ever before. The reality is that there is a lot of talk, but not an equivalent degree of action by the marketeers to be more competitive and accountable.
When businesses face difficult situations, the easiest thing to do is to cut down the ‘advertising and promotions’ budget to manage the profit and loss.
The reason is that most marketeers are unable to determine the Return On Investment (ROI) of their initiatives; hence there has been ambiguity around the business impact of marketing investment, undermining the importance of marketing in business value creation as seen by of other professionals.
But they all know and accept the fact that without marketing businesses cannot achieve financial results. So there is a conflict needing clarity and conviction across the entire organisation.
While marketing accountability is a priority, studies done in Sri Lanka send a clear message - We’re not there yet. As a marketing manager, you’re being held accountable for outcomes from the investment your company makes in marketing.
However, lack of agreement on what those outcomes are, and how the company measures their value versus the resources invested, are often at the root of the marketing blame game.
Impact
Clear expectations short-circuit the accountability blame game. So what’s right then? Your approach to marketing accountability and ROI is to start with a marketing plan that is specifically and unambiguously tied to agreed business outcomes. This is the foundation on which marketing accountability should be built.
With all of the recent buzz over marketing ROI, the truth is, it is not necessarily the most appropriate metric for every marketing initiative. While determining marketing, ROI is ideal for large initiatives and initiatives where it can be easily determined, such as direct mail or online marketing. It can be a complex and cost prohibitive process to accurately determine marketing ROI on small offline branding campaigns. Don’t get me wrong, marketing ROI is the ideal measure, but it can be costly to properly implement.
Marketing initiatives that have a strong business case in itself should be measured, and the cost should be factored into the marketing budget. Begin to design and select metrics and clear standards of performance that enables marketing to measure its impact, effectiveness, efficiency and value if you do not already have it in place.
It is important to understand and select the right metrics. Marketing metrics should tie to you three primary responsibilities as marketeers- acquiring, keeping and growing the value of profitable customers.
Marketing dashboard
Therefore, the metrics you select should in some way indicate the impact marketing is having on market share, customer value, and customer brand loyalty.
The marketing function should be properly and strategically positioned to pull in the same direction as the rest of the organisation. Alignment of people results in higher productivity for less effort.
When you have achieved alignment, the link between marketing project, programs and initiatives and the broader company outcomes is explicit- and each member of the marketing team understands the impact of their daily activities on the outcomes.
When you take this step you will be able to prioritise projects based on their value and impact rather than what’s most familiar, easiest or traditionally done. Make your marketing dashboard an iterative and collaborative effort.
A good marketing dashboard facilitates decisions. If your marketing dashboard doesn’t enable you to make course adjustments, know what is and isn’t working, and communicate the value of marketing in financial and strategic impact terms, then it’s time for a dashboard makeover.
There are two things marketeers can do to improve their accountability. First, ensure the link between marketing objectives and the associated programs, tactics and activities are directly linked to specific quantifiable business outcomes.
Second, demonstrate the value of marketing by setting, monitoring and reporting on relevant measurable marketing objectives, metrics and performance targets.Regularly assess the business critical data, analytical and measurement skills your team needs to possess, so as to be accountable and provide training and coaching to ensure alignment.
For many marketing organisations these steps may need process and cultural changes.
There have been enough professional views expressed over the years in Sri Lanka (and also the world over), to suggest that by implementing marketing accountability you will be able to hold or add to your marketing budget and you will become more effective at using marketing to drive business results.