How marketers approach forecasting and budgeting, marketing spend and performance, including return on investment (ROI), benchmarking, and specific Key Performance Indicators (KPIs) and metrics.
In order to win, marketers need to own the forecast and budget, and set a variety of benchmarks, continually analysing, adjusting, improving and investing.
Despite the efficiency and flexibility offered by forecasting marketing spend – and, increasingly, ‘zero-based budgeting’ – there is still a large gap between those that forecast properly and those that are just being handed budget to spend.
Reaching the right audience and customer acquisition is getting harder, burning cash on media isn’t the answer.
Customer acquisition and reaching the right audience to increase conversion or engagement is getting harder and it seems many of us (and especially start-ups) are burning cash just to drive traffic and report vanity metrics. Your customer growth should grow but your burn rate should fall, not outpace your customer growth.
We recently undertook research into marketing forecasts and budgets (soon to be published).
What we’re seeing is almost a third of respondents revisit spend just once a year or less and more than 50% no more than twice a year.
How do you create an agile organisation to get things done?
Organisations we have worked with are more and more frustrated with the inability to gets projects completed. It seems as if there is a need to plan and discuss projects and by the time this has happened the opportunity for test and learn has passed.
Here at Crank we are able to identify what needs to be focused on first to achieve the maximum return.
We take your data and look at areas which are under performing and then provide you with a to do list.
However there is no point in us giving businesses a to do list if they are unable to action the recommendations.
So what is the ideal team structure?
I thought I would start with the customer. I love the idea of the customer director and being a big fan of Geoffrey Moore’s Crossing the Chasm I thought his concept of creating a competitive advantage by understanding your customers is essential. One of the initiatives looks at
Ok this is a viewpoint not a manifesto, is it just me or when businesses use a ‘strategic canvas’ do they really consider data and the importance of being data centric? This is one of a couple of posts which will focus on the importance of data centricity. You may be customer centric but you should also be data centric.
So let’s start by looking at a canvas since that’s a good workable visual aid.
It seems there’s a canvas for most things these days, but like most things they tend to be stand alone. If you’ve ever used any of these in anger they usually solve just one part of the puzzle of your business or they are very high level, you then need to stitch some together or use another tool to move to action a team.
Like most consultancy’s or businesses running innovation workshops or strategy projects, we’d used Alexander Osterwald’s Business Model Canvas and Ash Maurya’s Lean Canvas which are truly awesome – fast, concise, and very portable, but we found ourselves modifying them for the needs of the client we were working with, especially when we started asking questions about data and what to do next.
Over the last few years data has become the hot topic in any strategy or directive, no matter the size of the business, start-up or blue chip, data is critical.
I know, data’s boring, but you only have to look at those businesses that are outpacing their competitors to understand that not only does data ensure you’re aligned to continually changing customer needs and expectations (customer centricity) but also that you place your money and resources in the right places and add competitive advantage in terms of potentially becoming the disruptor rather than the disrupted.
Data gives you the edge, it’s the river that runs through your business, multiple feeds from multiple sources creating insights on which to base critical decisions.
The issues are the same no matter what business we worked with, being able to move down in terms of detail from any model or framework is essential. When talking to senior people you need simplicity, but instances where you want to move quickly to action a team you need the considered detail which all of the team have been a party too.
Just tell me, what does good measurement look like?
So what does good measurement look like, how do we define it and how do we know we are putting our effort into the right things?
We have been wrestling with the issue of good to determine what it is and certainly what it isn’t. In the image above what good looks like varies from one individual to another. Beauty is certainly in the eye of the beholder.
We all seem to be obsessed with funnels talking about them and using them to make big decisions within our business. But when should we use a funnel? They have a role to understand where a business is trending; however they are useless at understanding what needs to be fixed.
At Crank we create funnels to build out a profile of business health, but we don’t just rely on the funnel to provide the answers.
As a for instance let’s take time, we like to look at ‘like for like’ time periods.
We have more data than ever and you would think defining what good engagement looks like would be easy to understand.
Just because we can get the data easily it doesn’t mean the answer immediately jumps out at us.
There was a time when we had to think about our questions rather than just extracting the data and saying “there you go, see the data shows . . .”
In this post we look at “what is engagement?” and “how do we measure it?”
I recently met up with a marketing agency where we discussed the customer experience.
We both agreed this was the vision and the thing we needed to achieve however when we then went into more detail it became apparent we had a different idea of what the customer experience was.
I wanted to know what we would be creating. A new process, a newly design online experience or new messaging?
The answer that came back was, we are going to create the “best customer experience”.
It became apparent to me there was an expectation that the technology was going to magically deliver the best customer experience without really defining what the customer experience was.
I come across this a lot and often find it amusing that the customer experience is seen as this magic “thing” which can be switched on. From here it is assumed the experience is now officially on, without trying to understand the customer problem we are trying to solve.
As marketers we are striving to select the best audience, timing, channel to allow us to get the best results. Sometimes we can focus too much on getting everything perfect. So why should I bother with the extra work?
Instead, why wouldn’t we just do things which are nearly there and learn by doing rather than over-analysing?
This is not about doing less or being slapdash, but more about thinking about when you need to go the extra step to make the campaign profitable.
We all are aware of the 80/20 rule whereby we try to get 80% of the value from 20% of our audience. However with more and more data, and ways of accessing and analysing this data, it seems as if paralysis by analysis has set in and we are unable to act quickly.
In fact why wouldn’t we apply the 80/20 again and get 80% of the way there in 20% of the time? This way it might not be the most perfect analytical model for selecting an audience but at least we would have created a campaign, which is still targeted, and it would have gone out quickly to our customers. We can then learn from what worked and didn’t work.
Percolate posted a great infographic which looked at what they called ‘Working’ vs ‘Non-working’ spend in marketing. Working spend is the amount spent on distribution of messaging/content across different channels, the more we spend here the more people we reach. Yeah obvious I know. Non-working spend though, is all the other costs associated with producing the messaging/content and how you measure effectiveness, and is more likely rarely measured or considered.
Reduce non-working marketing spend
So a clear objective should be to increase Working spend and reduce Non-working spend, but I wonder really how many marketers even look at this, procurement will for sure, but their role is often in at the front of hiring an agency or technology and then move on to other departments and how many mid market companies have a procurement person?
Non working expenses make up 40% of the average advertising budget and 20% of the average marketing budget. That’s some gap. And Non working spend is on the increase…which affects Working which results in less effective messaging right? Do you know what your Non working marketing/advertising budget is?