Marketing. It's a word that can stir up a variety of emotions within a company's management.
For some, it's seen as a necessary evil, an expense that needs to be managed and minimised.
For others, it's an exciting opportunity for growth and engagement.
The key to unlocking its true potential lies in shifting our perspective from seeing marketing as an expense to viewing it as an investment.
Why Is Marketing Often Seen as an Expense?
Perhaps, it's because of the traditional mindset that places marketing under the category of operational costs.
The Harvard Business Review reported that many companies are quick to cut marketing budgets during financial crunches, treating it like a dispensable luxury.
Shifting Perceptions: Marketing as Investment
However, a mindset shift is needed.
Marketing Drives Revenue: A well-executed marketing plan does more than just spread the word about your brand—it generates sales. According to a study by McKinsey & Company, businesses that prioritise marketing have 20% higher revenue growth than those who don't.
It Builds Long-term Value: Good marketing isn't just about immediate results; it's about creating lasting relationships with customers. It nurtures brand loyalty, which leads to recurring revenue.
Marketing Supports Innovation: By keeping your finger on the pulse of consumer trends, marketing fuels product development and innovation. Case in point: Apple's continuous innovation is tightly interwoven with their marketing strategies.
Take for example the story of BrewDog, the UK craft beer company.
They viewed their marketing not as an expense but as an investment in building a community around their brand.
Their 'Equity for Punks' campaign, which allowed fans to invest in the company, was a marketing masterstroke that generated both revenue and brand loyalty.
Communicating the Value of Marketing to Stakeholders
Convincing stakeholders to view marketing as an investment rather than an expense requires clear communication of its tangible benefits:
Quantify marketing impact: Use metrics such as customer acquisition cost (CAC), customer lifetime value (CLV), and return on investment (ROI) to demonstrate marketing's contribution to the bottom line.
Showcase successful campaigns: Highlight past successes as evidence of marketing's potential. Not only does this demonstrate value, but it also instils confidence in future campaigns.
Align marketing with business goals: Make sure your marketing strategy aligns with overall business objectives. This helps stakeholders see marketing as integral to the company's success.
Making this shift isn't easy, but it's necessary for your company to fully leverage the power of marketing. It's time we stop viewing marketing as an expense and start seeing it for what it truly is - an investment into our businesses' future growth.