United States
Marketing Week
February 10, 2010
by David Reed
If you wanted to sum up marketing during 2009, it would only require three words - return on investment. Forget soft benefits, intangible results and even brand building, what financial directors demanded from the marketing budget was a demonstrable impact on sales in the same quarter.
Perhaps this is only to be expected in a year when many companies simply needed to get in the cash in order to survive. It has also benefited data-driven marketing with its ability to show outcomes in an accountable way. Yet even as marketing has enjoyed a strategic renaissance of its scientific aspects, this same development may in itself only deliver a short-term benefit.
Francois Laxalt, head of marketing intelligence at Neolane, warns that this may reveal unwelcome outcomes: "What we see when we talk to clients is that too often the campaigns which are delivering in the short term are destroying some customer value and are not focused on customer lifetime value. The short term approach is not as effective as it could be." The downside risk of a new customer-oriented metric is no greater than with a ROI-driven perspective, since individual campaigns already often fail to deliver the expected results. It is unlikely that every marketing activity would generate a negative ROC. Instead, the upside for marketing is to be able to prove that not only is it helping the business in its short-term trading goals but is also laying down strong foundations for future revenue.
