How marketing can deliver more business value
A version of this article was published by the Holmes Report on Sept.16, 2014.
Earlier in my career, I led a global practice in a global tech agency owned by Donovan Neale-May. Donovan had a phrase that he uttered often, and that was the idea of “high torque marketing.”
What Donovan meant was simple. Marketing and communications not only must create new business value, they must also accelerate it.
The bulk of the focus on marketing and communications’ business value has been focused on awareness and lead generation. Much of marketing automation is focused on the top of the funnel. But if you speak with CEOs, they expect something far more significant, and that is proof of impact all along the customer buying journey. And let’s be clear: this means substantiated impact on actual revenue, margin and cash flow – the building blocks of shareholder value. In the minds of the C-suite, correlating our efforts to early indicators like lead generation, impression count and sentiment are not enough.
There was a time years ago when what passed for measurement in marketing and communications was grudgingly accepted. Today, however, it’s clearly no longer sufficient. CEO frustration concerning proof of impact is very near the boiling point. In many instances, their businesses are being disrupted at every level and every turn — tactically, operationally and strategically. Our profession, however, continues to “fight the last war” with a few shiny new weapons, an approach which very often does not meet the challenges our companies face.
When it comes to being disruptive — and being disrupted — the tech industry has no peer. They can teach us a lot about how to respond. Here are a few key learnings:
- Start with what matters. The right metrics and analytics are critically important to the success of any venture or profession. But they must align with and support business value creation. As a profession, we have been so enmeshed in conversations about functional metrics and analytics that we’ve failed to address the real issue. How do we create business value for our companies, our clients, our investors? As important as they are, stuff like awareness, reputation and even lead generation cannot be ends unto themselves.
- Map to business value. The only standards of business value creation that matter are business standards. Regardless of whether you work for a public, private, for-profit or philanthropic organization, the Laws of Revenue, Margin and Cash Flow are immutable and definitive. Given that, it’s time to get real about who we are, what we do, and most importantly, how the business can monetize their investment in marketing and communications. Right now, in too many companies and agencies, the answer to that last question is insufficient. That’s horribly ironic given how much value creation we actually drive for businesses the world over.
- Enlarge the circle. Frankly, marketing and communications need to inject some hybrid vigor into our thinking about measurement, analytics and proof of business value creation. With a few exceptions, we have failed to create metrics and KPIs that mean anything to the C-suite. Why? We typically have not asked for input from CEO, CFOs and sales leaders – the very people who decide whether we’re creating value or not. And the dominant role of the agencies in these discussions typically has translated into a focus on tactical metrics because those account for most of what agencies do.
- Be ready and willing to change. For years, tech companies had a blinkered view of what the customer wanted. The result was a manic belief in “features and functions” and an “if we build it, they will come” idea of marketing. Then customers began to look past those considerations to a focus on business value creation, and everyone – vendors and IT organizations alike – had to make some difficult transitions. The same dynamic is happening today in marketing and communications. The old “time and materials,” activity-based model is dying, and the speed of its demise will continue to accelerate. In its place, a new value-based model will rise for agencies and client-side professionals alike.
- Understand what success is. It is nothing more or less than being able to show the C-suite how you are helping to drive business growth, profitability and health – using real data organized into high-integrity correlations. Anything less than that may be interesting and relevant, but it is not what the C-suite is expecting from us.
Bottom line, we need to re-tool the marketing and communications professions to be full partner in business, not just functional players in the business. Social, Mobile, Cloud and Big Data have combined with a range of demographic shifts to destabilize the status quo in virtually every industry and profession. Add new CEO expectations concerning proof of business value creation, and we’ve got a wave of disruption that will rearrange the landscape of marketing and communications well before 2020.