We are approaching the half-way mark of another year living and working in a global economy that was just starting to recover from the pandemic, as the war in Ukraine introduced a renewed wave of fear and uncertainly. Collectively, these events have given vigor to the tired phrase “expect the unexpected”, have challenged our way of doing things and have thrust us into an ongoing learning process. Already inundated with trying to figure out how to leverage the latest and greatest new tool in our war chest, planning for the unexpected, adds another level of complexity to an already demanding job. So how can we deliver effective marketing and brand experience that resonates with our customer base amidst all this uncertainty, that is only going to continue to accelerate? It starts with a Strategic Marketing Plan, but that alone is not enough. The plan must be driven by digital transformation and tied to measurable operational goals.
As the saying goes, “The best-laid plans of mice and men often go awry.”
We are all familiar with the cyclical annual planning of corporate objectives – as we near the close of a calendar year, planning for the next year begins. Time is allocated to generating a marketing plan that studies our previous efforts – our wins and shortfalls – with an eye towards future goals and a return on investment. Once deemed complete, it is vetted by stakeholders, presented to management, and championed as the guiding light for the upcoming year and filed away.
More often than not, as the new year arrives, team members who have returned from the holidays, are off and running, independently fielding impromptu requests and picking up where they left off last year. Defaulting to what is familiar, they may dust off the Strategic Marketing Plan once in a while, implement portions of it in a piecemeal fashion to show value, but are rarely giving it the attention it deserves and therefore, are not executing it properly. As the normal frenzy ensues, the chasm/ disconnect between the Strategic Marketing Plan and the Marketing Execution begins to form/grow, unable to be realigned.
So, why the disconnect? The problem usually starts at the onset of planning. Do any of these scenarios sound familiar?
“We have to hurry up and do the Marketing plan”: planning is done in a frenzy – given no more attention than any other item on the to-do list
“Just send me an email with what you’re going to work on next year”: the plan is crafted from input solicited from different ‘silos’ within the department and is not a cohesive effort
“We’ll just use the one from last year and leave a block open for new technology opportunities.”: you may have heard about an emerging opportunity but are unsure how to leverage it, how it integrates with other efforts or what the benefits would be.
“Is our marketing content working? I have no idea.”
Does the CEO or CFO ask you to produce ROI on the campaigns you run? Do you struggle to collaborate with your team to execute thematic campaigns? Is your budget management inaccurate due to an ever-changing campaign plan?
Business decisions are based at best on past consumer behavior and at worst on gut feel. Poor planning results in a bottom-up approach that leads to the strategy-focused CMO and Marketing team missing the mark for results-oriented CEOs. This is why marketing teams are often times viewed as tactical support for sales and non-strategic to the business and just another business expense on the books. It’s something they invest in heavily, but don’t really see a bottom-line impact from. However, the adoption of advanced tools and analytics, when used correctly, has helped us to substantiate the value of marketing.
There is no room for marketing lingo around the board table
Many of the tools available today provide us with insight and performance indicators so we can prove and improve upon our marketing campaigns in near real-time. However their specificity forces us to attempt to measure results at the channel or tactic level – reach, likes, registrants, views, visits, downloads, logins, positive press coverage. When you can see how articles, pages, videos, etc., are performing, you can refine your strategy, and determine where to invest more or what to sunset. Now, this is an important calculation that certainly has its place, but when it comes to validating the business value of marketing within the entire organization, it’s not enough. It’s very common to see marketers communicating their results in terms of leads, as they struggle more than their counterparts to calculate results in terms of ROI.
Business value is not marketing metrics.
Marketing teams must be empowered for strategically-led, data-driven decision-making and experimentation – and there is no tool for this. Determining the dollar value of the work we’re doing is imperative because money is THE universal metric across all disciplines in a business. It’s the most transparent way to tell everyone whether a campaign will have a meaningful impact on the company. Calculating the dollar value is the key to validating the value of marketing within the entire organization, that is already overwhelmed with making decisions on target consumer markets, pricing, promotion, distribution channels, and product features and benefits.
In order to calculate your marketing’s business value, you need to:
- Choose and standardize how you will express the value.
- Make sure you are measuring at the right level -by campaign, not by tactic.
- Examine your business’ conversion funnel and determine the conversion rates at each phase.
- Map milestones of each campaign to the appropriate phase.
- Calculate the average lifetime value of a purchase or effort.
Letting the numbers speak for themselves
There is clarity to be gained in defining a framework that introduces marketing-measurement levels. The tools and outputs of each level are different, and they add value at different stages in the marketing funnel. Said another way, they answer different questions. It is important to match your question to the appropriate level of measurement or you will get incomplete, or even misleading, results back. The levels of measurement are:
Level 1: Plan measurement
Level 2: Campaign measurement
Level 3: Channel measurement
Level 4: Tactic measurement
It’s important to adopt a consistent approach to ROI measurement, both for campaigns and for an entire marketing plan. Once you have achieved that, you can create a reliable benchmark for your marketing organization’s performance, both to assess relative performance changes over time, and to compare your performance to similar organizations.
Key Principle #1: All marketing campaigns have an ultimate, quantifiable, financial target
Many marketers carry out their campaigns and then try to figure out retrospectively what the ROI was. This is backwards. It is more effective to identify your target financial outcome (your return), and use that to inform how much you will spend on marketing to reach your target (your investment). Of course, you can only do that if you identify your desired financial outcome.
Key Principle #2: ROI is not tied to the fiscal year
Leads, prospects and opportunities exist at various stages in the funnel. Deals are being actively negotiated by sales. Marketing campaigns are underway from the previous fiscal year. This means that some proportion of your marketing results for the fiscal year are already in the bag. From the perspective of this year’s budget, they feel free. But they were obviously funded from last year’s budget. It would be unrealistic to make a plan that did not fully take into account these carried over benefits from extant campaigns.
It’s important that your marketing organization, and your company’s executive team, embrace the notion that different campaigns have different value horizons and treat campaign investments as just that -investments with a return in the future.
Key Principle #3: Every phase of the funnel is worth the same as the financial target
It goes without saying, that we need prospects to create qualified opportunities (which are some percentage of prospects). Those leads contain 100% of the value of the sources of the financial target, plus a lot of leads that need to be filtered out through the marketing funnel and put into some nurturing campaign or lost. Every phase of the funnel – if its targets are achieved – is worth exactly the same as the final revenue outcome. This is a useful thing to bear in mind when you’re asked to identify the value of top-of-the-funnel marketing activities. If you understand your funnel and conversion metrics, you should be able to quantify it. It is critical to measure ROI consistently, and to be able to properly value marketing outcomes in the earlier stages of the marketing funnel.
The MaaS Marketing team has built a sophisticated and holistic view of HRO Today audience behaviors, preferences and needs. Our data is the foundation of actionable insights that can be implemented with speed and agility to power your next Marketing campaign. In order to distinguish your brand, you must be able to address customers’ constantly shifting needs, motivations, expectations, preferences and behaviors. We can help. If you’d like to near more about MaaS, you can reach us at firstname.lastname@example.org.