For far too long the marketing function has danced and side-stepped around the issue of return on investment (ROI) on marketing spend.
A scenario played out countless times over the ages is one of CEOs asking what the ROI on their marketing spend will be and marketers arguing it isn’t an exact science.
“You need to trust us this is working,” is the oft repeated answer.
This needs to end. In fact, CEOs shouldn’t even have the chance to ask what the ROI will be. Marketers should be insisting from the very start they are measured on it and proactively communicate to the business exactly how they are delivering value.
Vast opportunity for the modern marketer
A study by The Fournaise Marketing Group found that of 1,200 global senior marketers surveyed, a terrifying 90% were not trained to calculate ROI. Which means the reputation much of the marketing sector has for not being fully transparent when it comes to results isn’t an undeserved one.
Almost worse, the research found that 67% of those questioned didn’t believe marketing ROI required a financial outcome, preferring to rely on ‘Likes’, ‘Tweets’ and ‘Clicks’ as the KPIs they used.
These findings should frustrate the modern marketer, it’s this kind of fuzziness that makes many executives suspicious about marketing. It’s also manna from heaven for sales departments – often fighting for limited budget funds with marketers.
Take a look at these numbers…no, really, we insist
At MPG we pride ourselves on setting stringent targets that we have to be measured against to show the value our services bring to a client. We frequently hear from our partners that this is something they not only love about us, but it’s something they have rarely, if ever, encountered before.
Because we take a very analytical, data-led approach to our work, we are able to evaluate the financial success of the many and varied moving parts that make up a modern campaign.
We make it part of our standard reporting to clients to feedback in as much detail as possible on every channel we use to drive a campaign. Whatever numbers we get back from our analytic tools, we make sure the client gets too – with an added layer of value of intepreting the data for them and making evidence-based recommendations for their decision-making.
If one tactic has brought us success, we can show them what their investment has done for the company. CEOs are then assured their money is being well spent.
If something hasn’t worked as well as we hoped, we show them that too. Because then we are displaying our willingness to learn from our experiences and our ability to refine a campaign. CEOs know that we are being straight with them and are constantly looking to optimise results.
In numbers CEO’s trust
CEOs understand numbers. Numbers help give them focus, clarity and something solid to plan with. When marketers are open about the results of their work, it not only shows financial acumen, it also helps build trust.
With so much of the marketing sector hiding from ROI, there’s a huge opportunity for those practitioners who understand the benefits of full transparency and what it can do for marketing’s reputation.
As a function we need to raise the expectations of what we can offer and command respect by clearly demonstrating the value we bring to an organisation
ROI is, rightly, an obsession for CEOs. It’s the language they speak. Which is why it’s essential marketers learn to speak it too.