So what’s marketing good for, anyway?
April 12th, 2008 by Hugh Kennedy
In recessionary times (see under GE, Earnings Statement, 4.11.08), companies nearly always become more conservative about the value of marketing. That’s no surprise, though I’m still taken aback, working through my third economic downturn in this industry, at how quickly the winds shift. Just yesterday I heard about a client whose $10 million marketing budget had, in the course of five months, been whittled down to just north of $900,000 at the lower edge of the range.
So is marketing an investment or a line item expense, and what business problems can it solve? Local academic marketing programs often ask someone from PJA to come in and present the BtoB perspective on these eternal questions (see under John Wanamaker, advertising budget, which half is wasted), and though these are basic tenets of marketing, it never hurts to be reminded during an economic period when business common sense is often the first thing to suffer.
Here’s the list our head of interactive plans to present at an upcoming marketing class in a lecture hall near you:
Ten Business Problems Marketing Can Solve
1. It can change perceptions of your company. Is the market still playing an old tape about a business you were in five years ago? Old brand perceptions die hard. Marketing is a great way to move the needle.
2. It can help you launch a new business model. The Web opens up countless opportunities to help prospects and customers experience what your new business is about, especially in the virtual watering holes where people now trade advice and practice social shopping.
3. It can build your credibility in a new market. It’s a core part of the corporate executive’s role to set up the stock of the business, especially when you extend from, say, core business intelligence to corporate performance management, or even from coffee to breakfast sandwiches (okay, so that didn’t work so well). But executives can’t be everywhere at once. Marketing is your mouthpiece to be heard above the din.
4. It can help you stay relevant to target audiences. In the age of continuous partial attention spans, people need to be reminded that you’re keeping your edge sharp and innovating in ways that help them reach their goals. Good marketing programs are an essential part of maintaining market relevance. What’s your Purple Cow?
5. It can help you respond to a crisis. Jet Blue and Mattel learned this lesson well. American and Merck? Maybe not so much.
6. It can build awareness with limited budgets. One of the leading vignerons in Bordeaux was quoted this week saying that if the lousy 2007 weather there had happened in, say, 1957, there wouldn’t have been a harvest at all. Technology has come a long way in making what was impossible practical. The same is true in marketing. Video for the small screen is everywhere, and it costs nothing but time for an executive to blog.
7. It can generate sales leads. This sounds almost insultingly basic (I can read the pings and comments already, so bring ‘em on), but the chasm between marketing and sales persists in a lot of companies where sales forces and CFOs seem to think marketing can deliver a signed contract within a week of an ad in The Wall Street Journal. Unlikely, since the purpose of marketing is to engage, educate and then sell. And let’s face it, engaged and educated customers are more likely to stay loyal if you deliver the goods.
8. It can drive the sales process. The above point being made, marketing with an incredibly focused agenda can shorten the pipeline with astonishing speed. One technology company we know of posted a visually innovative video on YouTube and got 6,500 leads in two days.
9. It can motivate employees. Wouldn’t you walk with more spring in your step if your company was running the Mac vs. PC ads?
10. It can build your community reputation. I was looking at some European corporate social responsibility research this week that showed that 70 percent of consumers believe that a company’s commitment to social responsibility is important when buying a product or service, and two in five bought a product or service because of its links with good causes. That’s a lot of customers. Our clients are often amazed when they add up all the contributions of time and money their employees make. Why not tell the world?
Of course, all this being said, there are always problems marketing can’t solve. It can’t change the truth about your company (see under Clayton, Michael). It can’t make good on a flawed product. If the truth stinks, marketing can only cover it up for so long. The Paris city government found that when they sprayed the Metro tunnels with cologne rather than cleaning them.
Still, marketing programs can do a world of good to keep your company afloat. And when so many companies will pull in their horns and retract during recessions, what better chance to stand out if you don’t?
