In July 2012, The Fournaise Marketing Group released an interesting, if admittedly sad, statement on business unit alignment. For their 2012 Global Marketing Effectiveness Program Report, they interviewed more than 1,200 CEOs from across the globe and found that a staggering 80% “… admit they do not really trust and are not very impressed by the work done by marketers.”
Billions of dollars are spent on marketing and advertising each year. Yet CEOs willingly admit that they don’t trust the teams responsible for deploying those resources. Why? Because “…they have lost trust in marketer’s business abilities and have given up on holding [them] accountable.”
Which begs the question: where did the relationship between marketers and C-level decision-makers go wrong? If you ask me, it happened right about the time that marketers couldn’t clearly articulate the return they are providing to their company in realistic and measurable terms.
Let’s put it this way: our goal as an agency boils down to being able to deliver a multiple of return for a company’s investment in advertising and marketing. For some of our clients they want a 3:1 or 4:1 return. Others want a 8:1 or 10:1 return. Regardless of the exact multiple, the function is the same. You give us $1 of investment and we will build creative, strategic and tactical processes that allow us to return to you $3, $5 or $10. Are there guarantees? Of course not. But within this framework is a clear set of goals that provide focus to all marketing and advertising activities.
Now, whether you’re at an agency or work within an internal marketing department, I believe the days of throwing money and ideas at the wall to see what will stick are over (regardless of how much fun those days were to live through). Today, to be a successful marketer, you now need to be part artist and part scientist. You need to not only believe in accountability, but be hungry for it. If you do you’ll be rewarded with more trust, and therefore more budget, by your CEOs.
So how exactly do you accomplish this? A few starting points for you:
Define Success in Measurable Terms
Or to put it another way, start with the end in mind. No marketing investments should be made without having a clear definition of success. Meaning, “increase revenues by the end of the year” isn’t good enough. Rather, “increase revenues by 30% before December 31st” is specific and measurable… and makes everyone on the marketing team accountable.
Articulate What It’ll Take to Get There
The only thing worse than failing is not knowing that it’s happening. To protect yourself from that fate, and to give yourself the opportunity to pivot before it’s too late, create metrics that you can measure campaign performance against as you move along. These can be as simple as a certain amount of website traffic or a specific number of sales leads. But regardless of what they are they should be specific enough that if you’re off track you’ll see the red flags in time to make adjustments.
Align Your Marketing Analytics
There’s a great phrase that’s commonly used by computer scientists: “garbage in, garbage out.” Through the lens marketing analytics that can be applied to mean that if you don’t have your analytics platforms set up correctly – meaning that you don’t have good data being collected – then you’ll be in a position to make poor decisions as a result.
In modern marketing departments alignment between your varied analytics platforms – such as web analytics, marketing automation analytics, sales CRM analytics, etc. – is mission critical. You have no hope of running a data-driven marketing department and impressing your CEO without it. So don’t slack on getting this set up correctly.
Know Your CPL, CPA and LTV
Learn to love, and how to measure, these three acronyms:
- Cost Per Lead (CPL) = the average cost, typically by channel, to secure a sales leads.
- Cost Per Acquisition (CPA) = the average cost, by channel, to secure a customer.
- Lifetime Value of a Customer (LTV) = the average value, often by type, of a customer over their lifetime in doing business wiht your company.
If you understand CPL, CPA and LTV and know how to measure them then you can build a reliable model of your sales funnel. And if you can do that then you have the knowledge required to establish a repeatable process for revenue growth… which CEOs always love.
Learn How to Properly Manage Expectations
This might seem obvious, but as marketers it’s important we don’t go off into a corner and whittle away without involvement from the the core company decision-makers. Getting buy-in early and often from C-level folks is a critical aspect of campaign success.
There’s nothing wrong in being forced to justify your positions. In fact, as a data-driven marketer it’s a worthy challenge as it forces you to make better decisions. Take a page from your Finance department brethren and get comfortable in justifying decisions with data and models. It’ll make expectations management much easier in the long-run.