This article was originally written for, and published at, Digital Doughnut.
Read the original article, “The Secret You Don’t Want To Tell Your CFO When Your Marketing Budget Gets Cut”, here.
Marketing professionals are using new and sophisticated tools to prove the business value of their ideas. While everybody realizes that marketing investments are necessary, it is harder to prove the direct benefit for such investments. And, if anything, the recent trends towards Zero-Based Budgeting are making it even more difficult to keep budgets and initiatives moving forward, intact, year over year. If you’re responsible for your organization’s marketing budget, the chances are you’re well practiced in the art of uncomfortable conversations.
With media channels ever more fragmented and an increasingly uncertain economic climate, marketing budgets remain a popular target for heavy boardroom scrutiny. It’s a difficult job to justify the ‘science and art’ decisions taken by marketing in any given quarter to in organizations where numbers and ratios are compared with creativity, customer engagement, and long-term brand consideration. This creates significant pressure for justification and guaranteed ROI from marketing.
Zero-based budgeting assumes that the budget for each year is built from Zero; and each marketing investment must be justified with ROI metrics, by the CMO and their team. It forces department heads and budget owners to rethink their assumptions about what will drive value which in some ways is probably a good thing. However, every line on an empty spreadsheet that you hope to fill with a marketing activity requires you to provide hard evidence for the ROI it promises to drive. Such evidence has traditionally been difficult to come by. Now, though, there are ways to build an irrefutable case for each element of your vision.
In fact, you can, not only mitigate but even secretly thrive against a backdrop of cuts in your organization. Tools to help you measure and optimize your effectiveness are getting more and more sophisticated. So much so that some of the best marketing professionals out there are becoming experts at ‘doing more with less’, reaping the personal recognition and rewards by doing so. Such tools are capable of scientifically proving the relationship between marketing activities and channels as an input and sales as the output.
To learn more about these tools, read the full article on Digital Doughnut.