Marketing budget increases: Tips for wielding a double-edged sword for 2017
Many CMOs this year will find themselves with an increased budget -- and with it, increased accountability for driving revenues. Columnist Joshua Reynolds shares five important things to do now to help ensure success by year-end.
January 2017 is a pivotal moment in time for the marketing discipline. According to a recent Gartner study, 2017 marks the third consecutive year of increased budgets for CMOs for the majority of those surveyed, with digital advertising, marketing technology and analytics among the areas most likely to see an increase in spending. In fact, Gartner has long predicted that by the end of this year, CMOs will spend more on technology than CIOs.
This is a huge tipping point. It’s also a huge double-edged sword, as CIOs can well attest, because with increased budgets come increased expectations. And for marketers, the expectations are already high.
Increasingly, CMOs are being asked to take responsibility for driving revenues. Some are leaning into this and proactively seeking more financial accountability. Others are waiting for that accountability to be imposed upon them. Either way, 2017 is the year that marketing finds itself in the spotlight as either a money-maker or a cost center, with precious little gray area in between.
When it comes to marketing technology specifically, here are five important things to do, now, to make sure marketers have a firm grip on the handle of that double-edged sword come December.
1. Establish your benchmark
What visibility do you and do you not have into how you’re driving business results now? Where are your blind spots? Where are your quantifiable success stories? And what data do you need to document your impact?
Establish a clear baseline of results, and if you don’t have enough data to do that, establish a clear path to measuring your impact in terms your CEO, CFO and CRO will understand. Assign somebody on your team, this week, to come up with the best possible articulation of your business impact. Have them present to your marketing leadership team as if they were the CEO to reveal where your benchmark needs the most work.
2. Design your alliances
Who else is being held accountable for driving revenue results? Who oversees the data, talent and business protocols you’ll need to succeed? Chances are the CIO, chief digital officer and/or CFO are on your list. When was the last time you got coffee or drinks with them? Reach out and invite them — today.
Design an alliance rooted in the common goals your CEO is holding you both to, and agree how you’ll share information and resources for mutual benefit. Be as specific as you can about when, how frequently and through whom you’ll collaborate. Set regularly recurring check-ins — and keep them.
3. Illuminate your unknown unknowns
Data isn’t truth — it’s an imperfect digital reflection of truth. Before you commit budget and resources to a strategy, have an open dialogue with your team and your colleagues in adjacent departments about what you do and don’t know. Then decide what you’re going to do about it. Will you conduct data analyses to illuminate your blind spot? If you don’t, you’re essentially deciding to guess and verify after the fact.
Whatever route you choose, choose it intentionally. Be explicit about the assumptions you’re making, and share those assumptions with your team. So ask somebody on your team, now, to review what you do and don’t measure currently when it comes to business impact, and even more importantly, have them create a list of assumptions you’re making so you can do so mindfully. When it comes to analyzing business impact, a kilobyte of prevention is worth terabytes of cure.
4. Outsource strategically
Once you’ve got your benchmark, your internal partnerships and your assumptions and blind spots mapped out, you’re ready to think intelligently about where and how to pull in outside vendors to help you meet those increased expectations.
When it comes to marketing technology, the good news is you’ve got plenty of options to choose from. As of March 2016, Scott Brinker released his annual marketing technology landscape report with more than 3,500 different companies represented — an 87 percent increase from 2015.
The bad news is, many outsourcing engagements fail due to poorly identified goals and even more poorly identified blind spots. The only reason to pull in an outside consultant is to give you something you don’t already have. For example, one such company, Quantifind (a client of mine), is particularly effective at determining what impact competitors are having on revenues — a universally common blind spot — and how to fight back.
Regardless, choose a company that focuses you on what drives revenues. Ask an enterprising member of your team to create a shortlist of outside vendors that fill in gaps around what you need and ties directly to business results. Whittle that list of 3,500 companies down to a more manageable subset.
5. Let data fuel your curiosity — and your courage
As the British economist Ronald Coase once said, “If you torture the data long enough, it will confess to anything.” All too often, data analytics becomes an exercise in bolstering politically convenient conclusions.
Make a commitment right now to pursue the most balanced, unbiased view of your business impact. Recognize that the era of presenting vanity metrics is over. Have an open dialogue with colleagues outside your department about what evidence they would consider to be most significant.
Most importantly, let your curiosity guide you as to what data points and analyses to explore. If you can present to your senior executive team, with conviction, a data-driven view of where marketing is winning and where it needs to alter course, you’ll find yourself on the right course. Conviction convinces — even more than data does. Make sure you believe in the numbers you’re presenting, and don’t stop until you’ve found them.