OCT 2007 - World Authority on Marketing Metrics Seminar
The University of Auckland - Departmental Seminar
Impact of Marketing on Organic Growth and Business Risk: Metrics for Managing the Future
When: Thursday 25 October, 1.00pm - 2.00pm
Where: Commerce C, Room 501, City Campus
Marketers have long been under pressure to justify marketing expenditures and resource requests. This has led to some exciting work focusing on the impact of marketing-mix variables on sales and profitability as reflected in marketing dashboards and ROMI (Return on Marketing Investments).
Yet market-based off-balance sheet assets such as brands that drive cash flow continue to be a “blind spot” in decisions ranging from resource allocation to M&A valuations. All too often companies focus on identifying marketing actions that can deliver acceptable short term metrics rather developing strategies to out-distance competitors. In the words of the CMO of a Fortune 50 company, much of this work focuses on (at best) 25 percent of value that can be attributed to tactical marketing actions. The impact of strategic marketing “investments” (competitive positioning resources, customer acquisition costs, channel development, and brand-launch expenditures) that contribute the other 75 percent of value by enabling organic growth and sustainable advantages (lower risk) is less well documented. These marketing investments have multi-period payoffs. But, all too often, their usefulness in evaluated based on quarterly or annual performance.
This presentation will review five reasons why short-term metrics can undervalue marketing efforts. It will also discuss how marketers can better manage organic growth and business risk – thereby suggesting metrics for managing the future.
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