The economic ripple effect
The latest world recession has made us all more aware and critical of certain sectors. The most obvious one being finance. But where else are we seeing or feeling the ripple effect? Has Marketing been affected?
We are hearing more about how UK companies will have to work harder than ever to remain competitive, not just in the EU but worldwide. Businesses are looking ever more closely at how they are spending their budget and asking what value is it really driving? And in some cases are far more brutal than previously, if the impact is not immediately tangible then budgets are reduced or cut all together.
The impact on Marketing
One area that is already seeing the impact and one that will change forever is marketing. When a business is looking at it costs or annual budget it prioritises those areas with a tangible return.
Now, us Marketers will argue that marketing fits that criteria. However, the Finance Director (FD) will answer very differently. Why? Well marketing ROI can be difficult to calculate, add in the natural debate between the Marketing Director and Finance Director and you have a major task on your hands.
Quoting Albert Einstein is one option; I mean who can argue with the most influential physicist of the 20th century? If anyone can an FD can, so back to the stats we go.
“Not everything that can be counted counts, and not everything that counts can be counted”
The way forward
The biggest debate is to include or exclude salaries and indirect costs such as agency fees and application costs e.g. Hubspot all of which will lower the ROI? Now the answer to this will depend upon many factors including the market, your competition and your chosen business model, the Finance Director will largely drive the latter. So how does this impact those of us in marketing?
Let’s demonstrate true value and lose terms such as “halo effect”. Let’s stop hoping that our narrative is powerful enough in itself to win the buy in from both our CEO and FD. Let’s be meaningful and focus more on the numbers so we able to secure the budget required to beat the competition. This doesn’t mean rolling over and accepting a reduced budget when we know the impact will harm the business. It does mean revising the way in which we report marketing performance back to the business. I leave you with the wise words of Sir Francis Galton.
“Whenever you can, count”
Sir Francis Galton
The punch line
In my previous blog Marketing – Friend or Foe? I talked about how today’s Marketer has to be both creative and analytical. The challenge for us all is to find that balance. Let’s not lose the creative for the sake of the numbers but instead use the numbers to give us and our team a platform from which to create.