Whatever goods or services your company is trying to promote, marketing has a big part to play in turning this proposition into revenue. Unless potential customers are made aware of the new offering and what it can potentially do for them, there will be no sales. Hence this remains a vital business function, fundamental to everything private sector organisations are trying to achieve.
However, marketers have something of a difficulty when it comes to proving their worth to the business they work for. It is not always easy to establish a direct link between specific marketing activity and end results. Indeed, a study conducted by Fournaise Marketing Group in 2011 found that almost three-quarters (73 per cent) of chief executives think marketers lack business credibility.
The question is, what can the marketing department do to demonstrate its worth, using cold, hard figures? Metrics undoubtedly have a role to play - those which offer insight into all elements of campaign effectiveness and performance. Tools such as predictive analysis can help establish a clearer link between marketing and revenue, ensuring businesses are able to make the most of the advertising budgets, and recognise promotional activity that is working in practice.
Predictive analysis offers insight into customers
According to Steve Offsey, chief executive of MarketBuildr, measurement is "a key discipline" for any modern marketer. He commented that metrics which measure inbound, outbound, brand and other performance "are all critical". And thanks to a new generation of analytics tools, chief marketing officers are able to measure the impact of programs, and demonstrate "a clear and compelling marketing return on investment". This can help build respect in the boardroom, and ensure marketers are fully recognised for the contribution they make, he stated.
"While most marketing metrics tend to be backward looking, predictive models can be used to identify patterns in historical data," Mr Offsey stated. This enables marketers to anticipate what customers and prospects are likely to do next, he noted. Mr Offsey said predictive analytics can be used to answer such questions as which prospects are most likely to buy, what they are likely to buy, and which customers are likely to leave.
"Common goals, strategies, and success metrics for lead generation, qualification and prioritisation are key to improving sales and marketing alignment," Mr Offsey added. He suggested that lead scoring can help in this regard, but predictive analytics offers the biggest gains. "Unlike traditional rules-based scoring approaches, predictive analytics can be used not only to prioritise sales leads, but also to use available information to predict the highest likelihood of success with that lead," he claimed.
Mr Offsey said lead scoring can help eliminate the frequent finger-pointing that exists between sales and marketing. "By providing an unbiased measure that enables the impact of people and processes to be objectively evaluated, lead scoring can help chief marketing officers show marketing's impact on revenue, improve sales and marketing alignment," he stated. This can help them enhance their own credibility in the C-suite, Mr Offsey noted.
Marketers 'must speak CEOs' language'
According to Fournaise Marketing Group's study, marketers spend too long talking about brand, brand values, brand equity and other similar parameters which they struggle to link back to the results that matter. Some 72 per cent of chief executives surveyed said marketers are always asking for more money, but can rarely explain how much business this money will generate.
Jerome Fontaine, chief executive and chief tracker at Fournaise, said that until marketers start speaking the profit and loss language of their CEOs and stakeholders, and until they start tracking the business effectiveness of all their strategies and campaigns to prove they generate incremental customer demand, they will continue to lack credibility in the eyes of their bosses. In many cases they will continue to be seen more as a cost centre than an asset, he stated. This is where metrics, and the pursuit of business intelligence, can potentially make a big difference to the function.
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Posted by Dan Smith