Making the Business Case for Your Marketing Budget

 

  • CMO's face pressure from non-marketing leaders i.e. CFOs who tend to focus on short-run effect of marketing spending and are not patient for the long-run results
  • Need to build the business case based on alignment with business priorities and strategies - what are the marketing dollars actually going to do for the business 
  • Build a business partnership with CFO and do planning together 
  • Explain marketing hypotheses - how marketing spend will impact various business activities and outcomes 
  • Measure impact on brand and customer metrics - show KPIs associated with brand and customer relationships 
  • Create a full funnel view - top vs bottom
  • Build collaborative relationship with C-suite peers - marketing is an investment, not just a cost 
  • Run experiments - using a control group that does not get marketing spending. Goal is to understand the counterfactual - what if marketing had not occurred 
  •  Don't ignore impact marketing on costs - satisfied customers are more responsive to brand marketing and sales efforts, and share positive word of mouth
  • Appreciate metrics to budget connection - budgets need to be reviewed regularly together with metrics (not just annually)
  • Move to an investment mentality - educate other leaders about the long-term value of marketing spending
https://hbr.org/2021/11/making-the-business-case-for-your-marketing-budget

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