Thought Leadership Interview 2: Measuring Return on Marketing Investment

Last week, we spoke with Aberdeen Group analyst & author Jeff Zabin about his Recessionary Marketing Report: How Best in Class Companies are Weathering the Storm.  He provided us with insight on how they’re changing their marketing initiatives to survive and prosper during an economic downturn.  This week, Zabin speaks to the importance of implementing the necessary technology to effectively measure the success of marketing programs and quality of inbound leads.

 

CD: How do you see the situation for smaller companies? Could the recommended actions regarding precision marketing and ROMI be adopted by companies under $1 billion and with limited resources?

 

JZ: We certainly see that larger companies have an advantage in terms of their marketing. Historically, they’ve been able to harness the power of analytics to drive precision marketing effectiveness. They’ve built databases and used technology to create a unified view of the customer across geographies, touch points and so forth. In the past, that level of marketing analysis required a fairly large capital investment on the front end. But for smaller companies, the good news is the advent of software as a service. SaaS now gives them the opportunity to leverage new analytic technologies. They can realize the benefits of sophisticated, precision marketing programs at a much lower cost.

 

CD: Can you speak to the importance of integrating sales and marketing efforts?

 

JZ: Capital spending constraints have a way of breaking down the traditional silos that exist in an organization. I think we’re seeing more alignment not only between sales and marketing but all parts of the organization. Sales and marketing are finding themselves working more together. Any significant degree of marketing waste is no longer an option, and the sales cycle is often much longer. This means that lead nurturing is more important, so marketing plays an even bigger role in the sales process.

 

CD: Looking ahead, do you feel that companies adopting the recommendations in the report will be better positioned when the economy improves?

 

JZ: Yes. I think that’s the case. A greater emphasis on precision marketing and ROMI, will help companies achieve their goals. I think we should also mention new areas like social media marketing that is becoming more important. Social media might require a leap of faith for some companies. It’s still early stage, experimental and somewhat nascent. But I think that companies are moving away from a marketing approach centered on what they have to say to one that’s focused more on what the customers have to say. So I’m seeing a greater emphasis on social media marketing and the tools that enable it. All kinds of interactive marketing, mobile marketing and customer-generated content will become more important.

 

CD: Any final comment, a takeaway from our discussion?

 

JZ: I think it all goes back to what Peter Drucker has been saying all along – that you can’t change what you can’t measure. Marketers are moving away from an intuitive approach to one that’s based more on quantification that shows you the linear process of sales. It was a trend that was happening anyway, and I think the recession is helping to accelerate the process.

 

As Jeff emphasizes in this interview, measuring marketing campaign effectiveness and ROI is key to being successful, especially in a recession.  A big question for marketers:  What metrics should be used to determine a successful program?  While the metrics may depend of the type of program/campaign and aspects specific to your product or industry, Craig Rosenberg’s post Memo to the CFO: 3 Lead Generation Metrics That Matter provides great recommendations for measuring b-to-b lead generation success.  It’s definitely worth checking out.

 

 

Comments

[Christopher Doran]

It's critical that you're working with a marketing agency that is looking beyond design into campaign development. Historically agencies have been good at top of funnel activities, but fail on the follow-through. This is a HUGE opportunity for differentiation. Agencies that can directly tie themselves to the sales pipeline will become inexorably tied to an account.

[siva123]

Its sounds good, the information is very productive and informative. Marketing firms are now offering few of the services like creative design, consumer data, printing, fulfillment, analytics and website solutions. Good to see these kinds of services.