HEY NOW: Budgets are being scrutinized more and more, and too many people see marketing as an unnecessary expense forcing marketers to spend more and more time justifying marketing dollars. You can get lost in metrics and spend way too much time if you don’t understand your audience’s importance.
Steve Jobs use to spend more on marketing when the economy was down because he felt his brand’s voice needed to be heard. A lot of brands are hurting today because the pandemic has hurt consumers in their wallets but should you cut marketing?
Let me start off by saying that every brand and market is unique. What works for soft drinks won’t work for clothing. In order to ensure you’re allocating your marketing budget wisely, you need to really understand your customers beyond demographics. You need to know:
1ne: Where are they online?
2wo: Why are they our customers or why do they chose competitors over our brand?
3hree: What’s important to them in this product category?
4our: Is private label eating share and why?
5ive: Are we responsive to our customers needs?
Marketing metrics should always start with a top-down approach. Start with sales and look for spikes. Why did sales spike and did you spend more on a marketing program at that time like FSI or POP display?
The second metric to look at is spend by bucket. For example, can you justify continuing to spend money on TV if you’ve exceeded reach and frequency? Can we do a test of running spots in one market vs. a blackout market and correlate results?
TV is great for awareness but once that awareness level is reached you need marketing that will pull customers into the brand.
Digital marketing dollars are wasted by ads that don’t do anything and paid search when consumers prefer organic search. Way too many brands spend big bucks on website design without ever looking at how consumers use their website.
Another expense I often look at for clients is agency fees. Too many agencies are designed to get you to spend money without having the responsibility of ensuring results. This is why agencies are losing people and clients.
The other piece of the puzzle is your management team. If they believe that marketing is an expense, you’re going to need a lot of time to convince them of the value of marketing. If you have a frustrated Spielberg wannabe as a marketing VP, you can bet people are going to stroke his ego to keep him happy.
If we spent as much time thinking like a consumer as we do justify what we spend on marketing, brands might be better positioned. Today, it might be better to think about profit in relation to sales than market share increases. Think about what you’re really trying to do.
