Implementation of a marketing/brand strategy requires the activation of a string of initiatives that will result in the desired strategic outcome in the longer term. As quickly as possible, these initiatives should be measured to determine if they are going to achieve the outcome desired. But how can the implementation of strategy be set up in such a way as to measure outcomes and respond? This is a key to success – and is at odds with so many traditional approaches to marketing strategy.
Literally Brilliant can help you move your organisation from a marketing expense budget acquittal model to a zero-based outcome-orientated marketing investment model for budgeting and measuring strategy implementation success.
Marketing return on investment has always been an issue for companies regardless of size. Company Directors and Chief Financial Officers struggle to understand the return they get from marketing expenditure. They know they need to spend money on marketing but they don’t know how to keep the Chief Marketing Officer accountable for how the marketing budget is discharged.
This situation is further complicated by the fact that many organisations offering marketing services to these businesses benefit from the magnitude of the marketing spend. Quite simply, the more they spend on marketing, the more money these companies make due to production fees and service fees being charged as a percentage of cost. There is no incentive to demonstrate how marketing budgets can be reduced.
In smaller businesses, business owners know that they need to spend money on marketing but, when every dollar is vital for running the business, how much should they allocate to the marketing budget?
We believe that the answer to this question is zero.
The starting point should always be a marketing budget of zero.
Marketing budgets should address marketing issues that need to be addressed. If the issue is understood, either as a problem that needs to be solved or opportunity that needs to be leveraged, a desired outcome or set of outcomes can be articulated. This is known as an outcome focus. Companies can then clearly define the parameters of the marketing initiatives it seeks to implement. An issue is addressed by an initiative. An initiative delivers an outcome. The value of the outcome can be directly associated with the cost of the initiative.
Budgets can therefore be developed as a series of targeted initiatives. If the budget total exceeds cash flow capacity, then the programme of marketing initiatives can be prioritised over time to identify the initiatives that can be pushed out to all the marketing programme to fit within cash flow constraints.
Rather than trying to measure a consolidated return on investment for total marketing spend, marketing spend can be evaluated on an initiative-by-initiative basis. If a marketing investment was successful in achieving the desired outcome, then the investment in that initiative is considered successful. If it doesn’t achieve the desired outcome, then that investment is not considered successful.
Unsuccessful investments can be further analysed to determine if execution of the initiative played a role in underperformance. This analysis informs marketing initiatives of the future, helping to avoid repeating errors of the past.
Literally Brilliant can help you to identify key marketing issue that need to be addressed in your business, help propose and cost initiatives to address those issues and the outcome measures by which they should be judged.
We will help guide you through implementation through ongoing marketing mentoring and then help you to appraise performance of each initiative against stated desired outcome to give a holistic evaluation of your marketing investment.