typically spend less than 10% of their time focusing on where 90% of their
success comes from. Little time is spent on discussing where the revenues
come from, and how they could be improved, before the conversation quickly
progresses to operational performanceand cost management.
Marketing performance should be included and ideally lead the agendas of :
- Board meetings
- Quarterly business reviews, for managers and staff
- Investor relations briefings for analysts ad media.
- Annual reports available to all shareholders.
Imagine the CEO standing up at the next board meeting and marketing being
the focus of commentary, their current performance, and the investments
that are currently being made to secure and enhance future results.
This might seem as an obvious place to start in reviewing a business, yet
the vast majority will start with costs, processes and supply chains.
Why are business leaders so reluctant to focus on marketing, or at least
the customers it focusses on, and the revenue it drives? While supply
chains can be measured in all sorts of units, and the costs of them are
real and influenceable, understanding the dynamics of brands and
innovation, communication or distribution is much harder without numbers.
Marketing performance, short and long term, should be a key part of all
business reporting and, while conventional accounting may not do it
justice, there are increasingly more opportunities for directors to
articulate non-financial, forward-looking information for stakeholders to
help them make more informed judgement about the future prospects of the
business.
Marketing should ensure that the internal and external value contribution
of the following is fully articulated :
- Return on marketing investment, both short- and long-term.
- Key differentiating initiatives, e.g. Time-to-market, store interior.
- Strategic initiatives, e.g. New market entry, new innovations.
- Intangible assets such as brands and customer relations.
Marketing reporting should therefore be both quantified data and
qualitative statements. Ideally a balanced scorecard of metrics could be
used to drive marketing decision-making and performance measurement. In
this way activities that have most impact on business performance can be
focused on and reported.
As the source of future cashflow - marketing - struggles to articulate
itself to non-marketing audiences caused by the language it wraps itself
into, thereby creating resistance from financial and operational people.
Marketing needs to articulate its performance in a simpler language and go
back to where we started : boardroom directors spend less than 10% of their
time talking about customers and the revenue that comes from them.
Quoted from : "Marketing Genius" by Peter Fisk
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