Marketing moves quickly – and it continues to accelerate. Spending has to happen quickly to keep pace with the required execution. How can marketers (1) ensure they don’t miss their plans and (2) communicate results clearly and objectively?
Marketing is an ever-more complex discipline. It can sometimes feel overwhelming to deal with the chaos of high velocity, high-volume digital marketing while handling the long-term, high-cost, high-orchestration, must-get-it-right pressure of costly events. It’s easy to get lost in the details and easy to measure the wrong things, as many marketers do. This can all lead to failure in your marketing efforts.
Companies, and functions within companies, need to stay focused on high-level plans and objectives. As a discipline, marketing has fallen behind its counterparts. But there are only a few ways marketing plans can fail by missing their targets.
Here are the most common reasons marketing plans fail:
One common way marketing plans fail is by overspending. Spending more money than you were allocated will not win any popularity contests. Why is it that marketing so frequently overspends? One of the main reasons is that it doesn’t have visibility into a few key data points.
Add to this the fact that everyone spends on Marketing. Marketing is a unique function because, throughout the organization, staff at all levels is authorized to spend frequently significant amounts of money quickly, in ways that no other function can.
To execute the plan, the marketing organization typically has to spend and hope it is not over budget. As the velocity of marketing continues to accelerate due to the ongoing explosion of digital, this problem is getting worse, not better.
For all the reasons above, it is just as likely that marketing teams underspend. There might be certain – especially public – companies who think this is a good thing because it improves the P&L. But, in the normal course of events, it is A Bad Outcome.
Underspending means that marketing has failed to deliver on the plan and budget it committed to. If you don’t spend your entire budget, you can’t deliver your entire set of results. You cannot underspend and achieve your business metrics unless
Even if you land perfectly on your financial targets, marketing must demonstrate that it delivered what it committed to. We think a lot about the challenge of measuring the right things at Planful, and we’ve discussed elements related to the topic here. You can also check out our article on key marketing metrics to measure.
In every discipline, the importance of measurement is increasing. Marketing also needs to measure and report on KPI achievement. However, it’s a hugely fragmented domain, with fabulous reporting capabilities in certain silos (for example. Facebook or Google Ad campaigns) and relatively challenging objective reporting in others (for example, radio advertising). These silos tend to be channel, rather than campaign, oriented, leading to bad practices (as I’ve previously written about here, modeling attribution on a channel basis is the wrong approach).
The right approach is to group together activities across all channels and measure their collective contribution to the overall campaign objective, such as acquiring new customers or developing pipeline, which can be measured objectively using metrics that colleagues outside marketing understand and care about.
Hitting your KPIs is one thing, but hitting them at a target ROI is another. This is important as it calibrates the return on marketing investment to the overall company P&L. The Marketing ROI might be a headwind dragging, or a tailwind augmenting the corporate P&L. Either way, it needs to be known within the context of the overall financial plan.
I’ve discussed how to measure Marketing ROI. The ability to show ROI, measure marketing over time, and baseline and benchmark your marketing performance is critical for any marketing team trying to tie metrics to their ROI.
According to the Planful Marketing Graph, 74% of marketing organizations are not setting strategic goals with KPIs. Setting and measuring goals is critical to becoming a successful marketing organization and avoiding the failure of a marketing plan. First, it is required to establish a realistic ROI benchmark. Second, it enables teams to measure progress over time. Third, it is a prerequisite to maintaining credibility as a discipline and a function within corporations.
In our marketing goals eBook, we discuss the importance of goals-based marketing and teach marketers how to define a set of goals that align with their strategy and, most importantly, your company initiatives.
It is possible to manage your financial and business targets in alignment and to establish and report on objective results and ROI calculations with Planful’s marketing ROI software. We built the product to enable marketing teams to collaborate to deliver accurate budgets with objective ROI at the pace of modern marketing. If you’re at risk of one of the 4.5 errors above, give it a try.