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When it comes to marketing return on investment, I always recall what Lord Kelvin, the British mathematical physicist, said a century ago:
“When you can measure what you are speaking about, and express it in numbers, you know something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind.”
Is your knowledge of your marketing return on investment of a meager and unsatisfactory kind?
“Why do CFOs want to slap marketers in their face?” asks international marketing expert Pablo Turletti. “Is it because they cannot prove marketing investment returns?”
Turletti’s metaphor conjures up ancient codes of conduct where you might get slapped as a challenge to your honor. Now, I don’t condone duels or C-suite face slapping, but Turletti has a point.
For those who want to attract high-paying clients, measurable results are essential. Marketing leaders who claim that marketing cannot really be measured are frustrating to other business leaders. For marketing to become impactful to companies’ bottom lines, Turletti advocates that marketing leaders need to start speaking the language of business. That language talks about return on investment.
Turletti has worked in more than 30 countries for more than 50 multinational corporations, has written three books, teaches in two business schools, and hosts around 40 conferences on marketing ROI per year.
What can marketers do to avoid the slap?
Turletti offers several recommendations:
Include business objectives as part of marketing projects. “Measuring CTR, clicks, reputation, and awareness is not enough,” says Turletti. “It is imperative to incorporate real economic credible indicators such as revenue and return.”
Create your own attribution model. “There is not an off-the-shelf one,” says Turletti. “You must create it using quantitative research, for your product or service, in your market. Forget about time decay, first or last click! These are arbitrary nonrobust attribution models that can only prove that there are no criteria to isolate the economic impact of a project or campaign.”
Go beyond profits internally. “Communication is at the core of all marketing activities,” says Turletti. “Using this set of skills can transform the organization from the inside incorporating social and environmental impact as part of the overall business plan. It is not about corporate social responsibility, but about corporate social business. The companies that will thrive in the future to come are the ones that will go beyond profits. It is essential that doing good to society and the environment becomes profitable, hence sustainable, and impactful—rather than rhetoric or esthetic.”
Go beyond profits externally. “Marketing must deliver messages that reflect not only the functional or emotional characteristics of a product or service but its impact on a given purpose society can align with that is part of the business core,” says Turletti. “At the same time, campaigns shall educate consumers around the idea that doing good and making money is not incompatible. Profitability and sustainability must go hand in hand.”
Measure, measure, measure. “As Peter Drucker would say: you can only improve what you measure,” says Turletti. “Measuring the actual return on marketing investments is key to show marketing’s contribution to the bottom line of companies, to prove that sustainability can be profitable (and that there is nothing bad in it), making marketing and the company accountable not only to shareholders but to all stakeholders.
Bottom line. To avoid the potential slap from CFOs, marketers must make sure they plan and work as a profit center and drive the business beyond those profits they measure.
