BrainTrust Query: Beating the Fallacy of ‘Cheap’ Marketing
Through a special arrangement, presented here for discussion is a summary of a current article from Cultivating Your Customers, the M Squared Group blog.
Your CEO just rejected another proposal that could increase revenue on the grounds that the marketing investment was too great. What are you to do?
I was speaking with a prospective client the other day and he shared stories of how marketing spending was reduced annually for the past five years. As a result, the brand was in decline and the products more like commodities than before. Each time he brought a recommendation to drive revenue by increasing marketing investment — social media, content-based marketing, long-term lead nurturing, improved web analytics — he was told to estimate the absolute minimum amount to get started. Then management delayed for several months, and eventually agreed to even less spending, so that the marketer couldn’t even get a good read from a test, much less roll out a new initiative. When asked, his CEO bragged about the fact that the company never spent money frivolously, that they were always "cheap."
And this behavior is not uncommon. I’ve seen other companies steadfastly refuse to make investments that can have a direct payoff because those investments would be greater than in the past.
Can you wonder why marketers feel more stress and burnout on the job now than ever before?
To be fair, since 2008 the "new economy" has brought challenges to businesses. The market is tougher than ever and consumers more price conscious. But those are the exact reasons that companies must invest or find themselves in a "race to the bottom," trying to outdo each other in spending cuts until there is nothing left to cut.
To break through and successfully engage your senior management, you have to play on three leverage points:
- Peer Group (other executives): There is no better way to move a CEO to action than to show him that his friends and peers are moving ahead without him.
- The Competition: Executives tend to have an obsession with the actions of their immediate competitive group. Pull up examples of work that the competition is doing, listen to their analyst calls and read articles about them to demonstrate the advantage that they are gaining by taking up your strategies.
- The Board: Identify the companies board members are affiliated with and show how they have taken the lead in these key strategies. The risk of being caught unprepared at a board meeting or by a board member offline is enough to motivate a CEO to action.
You can trim mass media and get away from it, but you cannot trim customer contact and relationship building without seeing both immediate and longer-term effects.
What are some strategies marketing professionals can use to get the green light from senior management on marketing investments?