I’m starting with a premise: Marketing is an investment. We’re all in agreement, right? Great … let’s carry on.
The vocabulary of investing includes terms like appreciation and depreciation, assets and liabilities. In reality, marketing, just like exceptional customer service, is a potentially appreciating economic asset upon which investment is often not immediately measurable. Do it right, and its value—along with the value of your company—appreciates over time. Do it wrong, and its value depreciates, just like that of your company. For example, can you truly put a hard numerical value on the re-branding of your company or the refinement of a strategic mission? Probably not. However, each of these marketing-dependent actions produces a long-term return, and when done right, can make the difference between a company’s growth and obsolescence. Put another way, What’s the cost of going out of business? If your re-branding allowed you to be on the right side of the success in a changing marketplace, then you picked a winner.
Do smart investors waste their money? Of course not, and none of the above is to give marketing a license to be wasteful … far from it. To the contrary, we can and should be mindful of costs, productivity and efficiency, especially when today’s technology allows marketers to be smarter than ever about avoiding wasteful spending. But in all the hype about automation, data, analytics and tracking, it’s easy to forget numbers sometimes don’t mean anything, to paraphrase data scientist Cathy O’Neil of Mathbabe.
If math can be meaningless, today’s data-happy marketer asks, “What do we turn to if the numbers aren’t helping us?” For starters: Creativity, vision, experimentation, old-fashioned “horse sense,” and traditional principles that have stood the test of time (e.g., rules of human-computer interaction, consumer psychology, persuasive language, good storytelling, the creation of emotional connections with customers). I’d argue that the skillful application of the previous by outstanding people is the true factor of marketing investment performance, more than any typical KPI (key performance indicator) like cost-per-click, conversion rate, lead volume, traffic or rankings.
On a related note, organizations that optimize the emotional connection with their customers outperform competitors by 26% in gross margin and 85% in sales growth (via The Gallup Organization). You like numbers? Show those numbers to your corporate accountants. And if nothing else, keep a level head about the potential and context of marketing’s role in the world … and don’t get lost in the numbers.
If you still need data to support investments in marketing, read one of the most popular posts in this blog’s history: Digital Marketing ROI (How Much Does Digital Marketing Cost?).
Photo courtesy of psyberartist via Flickr.