In the manufacturing industry, where each step in production has a clear and specific purpose, marketing leaders face a significant challenge: proving the impact of their efforts to executive leadership. To be fair, this is not a problem faced solely by marketers in manufacturing, but really B2B marketers across industries.
This tension isn’t always due to poor outcomes (even though that’s sometimes the case). Most often, it stems from a communication gap. Marketers craft creative and engaging strategies but often fall short in translating these strategies into the data-driven language that resonates with executives. This disconnect prevents their strategies from being fully appreciated at the higher levels of the company, making it more difficult for marketers to garner the support they need to be successful.
In this blog post, we'll outline practical steps marketing leaders can take to bridge the gap, demonstrating their value and aligning more closely with the executive team's vision.
The Language of The Executive Team: ROI
Let’s face it, the executive suite’s skepticism towards marketing is not unwarranted. Many have tried to implement big marketing initiatives in the past with little to nothing to show for it. They know that they should be marketing and that it can be effective, but they haven’t seen the results themselves.
Many marketers talk about increasing website traffic, brand awareness, and social media followers, but these are vanity metrics. Increasing these key performance indicators (KPIs) may look nice, but they don’t necessarily impact the bottom line. And nowadays, the secret is out; executives know this too.
Here’s the thing, company leadership wants every dollar they spend to come back with more dollars. They care about return on investment (ROI) over everything else. As a marketer, it’s your job to make that happen. This means it’s also your job to show in clear and simple terms how your marketing operation is, or is going to, drive sales for your organization.
What You Need To Calculate Your Return on Investment
There are various ways that you can go about calculating your marketing ROI, but here at G8P, we’ve boiled it down to a few key metrics:
- New Customers per Year from Marketing Efforts - How many new customers are you gaining each year thanks to your marketing campaigns
- Customer Lifetime Value (CLV) - CLV is the average amount of revenue a single customer generates for your company throughout the lifetime of your relationship
- Your Full Marketing Budget - How much your company spends on marketing each year, from employee salaries to software subscriptions to events
To calculate your ROI, you multiply the number of new customers per year by customer lifetime value, then compare that figure to your total marketing budget. You should look to at least double the amount of revenue you’re bringing in compared to your marketing budget. (NOTE: ROI is actually a slightly more complex calculation, but this still gets to what’s important, which is this: how much revenue does your organization generate from marketing, compared to how much you spend on marketing.)
The key takeaway? It's crucial to show how your marketing initiatives impact at least one of these three metrics. Demonstrating this connection to the executive team can help you not just justify your marketing spend, but also highlight the value of your marketing efforts. It’s all about proving the worth of your marketing endeavors in terms the C-suite understands and values.
But how do you actually go about impacting those numbers?
How You Actually Drive Marketing Returns
A big mistake that many marketers make is what we call whack-a-mole marketing. This is the disjointed implementation of various marketing tactics, without thinking about the marketing infrastructure required to reliably and efficiently drive sales. At G8P, we created the Great 8 Pillars Framework to provide the foundation for the “ROI-Driven Marketing Operation,” which is a marketing operation that drives huge, trackable returns on marketing spend.
To build an ROI-Driven Marketing Operation, you need to think beyond just marketing tactics. Instead, you need to focus on getting the right people, strategies, systems, and software in place.
Let’s start with software.
Software
You need to have the right software in place, ensuring these tools can communicate with each other to track each step in the customer’s journey and reliably measure the effectiveness of your marketing efforts. You cannot reliably calculate return on investment if you don’t know if they came from your marketing efforts, and you’ll have a much harder time increasing those returns if you don’t know what they did prior to becoming your customer.
Some of the most important software to have in place include your content management system (CMS), your marketing automation system, and your customer relationship management (CRM) system. It’s important that all three of these are set up and integrated with each other to maximize efficiency and ensure accurate reporting.
Strategy
At the very least, you need to have a written marketing strategy that outlines how you will bring in and convert customers. You should have tactics and strategies for each stage of the funnel:
- Top of the Funnel (Awareness) - How will you make prospects aware of your organization and your offering?
- Middle of the Funnel (Consideration) - As the prospect is going through the decision process of whether or not to work with your company, how are you nurturing those leads to increase the likelihood of conversion?
- Bottom of the Funnel (Conversion) - What marketing tactics are you implementing to seal the deal? Often, this involves working with the sales team to provide them with the materials and automations they need to convert the prospect into a customer.
People
One person can only do so much. The best software and strategies can only take you so far without the right people to implement them. Whether it's in-house talent, contractors, or agencies, having skilled professionals who can execute your strategy is vital. You must consider the expertise you need to implement your strategy effectively.
Systems
Lastly, none of this works without solid systems (think “processes”) to tie everything together. Systems ensure that your software, strategy, and people aren't operating in silos and are working in harmony toward a common goal. They provide the structure needed for your marketing efforts to be sustainable, scalable, and successful in the long term.
The Great 8 Pillars Framework goes into much more detail on each of these components, but the basics remain the same: your marketing infrastructure is the bedrock of your success. It's what enables you to not just dream about high ROI but actually achieve it. By focusing on these fundamental elements, you're not playing whack-a-mole; you're building a system designed to generate substantial, measurable returns. You’re building an ROI-Driven Marketing Operation.
Getting The Executive Team On Board
Once you've mapped out your plan for building a robust marketing infrastructure that's designed to drive returns, the next step is getting the executive team on board. This isn't just about presenting a wishlist of tools or initiatives; it's about demonstrating a strategic plan that connects directly to the bottom line.
For example, let's say your current setup lacks marketing automation software and you want to propose an investment in it. When you present this to your executive team, the key is to link this investment directly to at least one of the three critical metrics that define marketing ROI: the number of new customers acquired through marketing efforts, the customer lifetime value (CLV), and the overall marketing budget. There are a bunch of ways that you can do this:
- Marketing automation software could be used to nurture leads more effectively and increase conversion rates, leading to more customers.
- Marketing automation software could be used to nurture current customers to buy more, increasing customer lifetime value for the company, while having a minimal impact on the marketing budget.
- Marketing automation software can save time for marketing employees, so they can work on other important tasks that will bring in more customers.
The more specific you can get, and the more you can connect it with other areas of your marketing strategy, the more that the executive team will see the connection between marketing spend and return on investment.
This approach is likely to make the executive team more receptive to your marketing plans. It's one thing to claim that a new piece of software or a particular strategy will improve your marketing efforts; it's another to show how these improvements directly contribute to the company's financial goals. By demonstrating that your proposed marketing plan is designed with ROI in mind, you're not just advocating for more investment in marketing—you're showing how this investment is a critical part of the company's overall success.
When they can clearly see how your plans lead to a strong return on investment, their support for your marketing efforts becomes not just likely, but enthusiastic.
Discover More at G8P's Exclusive Webinar
Curious about how you can showcase your value and secure the trust of your executive team? Join us at G8P's upcoming webinar on March 19th, where we'll dive deep into the strategies and insights you need to bridge the gap between marketing efforts and executive expectations. And because we love to add a little extra value, we're offering exclusive goodies to those who register!
Register now to secure your spot.
