Chief marketing officers have 99 problems, but too much budget isn’t one of them.
The myriad of potential digital channels and touchpoints available to present your brand’s message to your audience has never been more dizzying for marketing and sales leaders.
Many sectors have seen marketing budgets cut as a percentage of overall company revenue during the pandemic. The long-promised recovery has yet to materialize, and this has put more stress on marketing leaders to correctly calculate which activities to invest in to maximize the return on what little marketing budget they have left.
Then there’s the challenge of maximizing resource. The talent shortage is predicted to continue, adding to the need to maximize every second your brand is in front of your target audience.
It’s hard to find a marketing manager, sales director, or chief marketing officer who has run out of channels to optimize, content to create, or internal projects to complete because they have too many pairs of hands at their disposal and budget they can’t find a way to spend. There are perhaps only a handful of giant brands being the exception that prove the rule.
If It Were Easy, Everyone Would Do It
The good news is that customers are giving us a clue to the way forward in their behavior—and remember, they’re always right.
Response rates, conversion rates, and average order values increase when a customer is offered a personalized, customized, tailored experience. This is why a strong customer experience is now accepted as the number one priority for marketers.
As organizations react to the growing demand for a personalized experience in business-to-consumer and business-to-business selling, we are seeing a growth in the transformation programs that migrate a brand toward a digital-first relationship with their customer or client.
Some examples include implementing self-service insight platforms to view a customer's progress through a sales and marketing funnel and making your expertise available via live chat to decrease cost per acquisition of a new customer.
These technologies can be sizeable investments and take 18 months or longer to implement but will result in reshaping an organization to focus on providing exactly what the customer needs at each point of their journey with your brand.
How can marketers implement similar thinking in their strategy?
Personalize everything. And where you can’t personalize a resource/asset/content piece for any reason (either due to the point in the customer journey, the level of the tool used to control it, or any other blocker), you need to ask yourself “Are we committing too much budget/resource to this?” The answer will almost always be “yes.”
The non-personalized, unprompted, badly timed outbound email is 2022’s equivalent of a flier for this Saturday’s singles night, jammed through the mail slot of a married couple who just flew to Mexico for two weeks—utterly pointless. They just make the doormat/inbox look untidy. They create resentment against the stuffer and sender.
% Media Spend ≈ Personalization Potential
The proportion of your total resource and media spending available should roughly equate to the level of personalization you can apply.
To help identify how much of your digital sales and marketing efforts are going to the activities most likely to yield revenue, Credera’s Modern Marketing Transformation team have created this simple model:
Plot your marketing and digital sales channels and activities around it based on:
From left to right:
What percentage of your monthly average media spending is allocated to each activity? You could consider the amount of hours/effort required by your team too.
From top to bottom:
To what extent can you personalize the content your customer sees via this channel/activity? The more unique to their preferences, purchase history, and any data-led next best actions they are, the higher they should sit on the ‘Unique to Individual’ axis.
Here’s an example of a populated chart:
Note that we’ve categorized the activity types above (color coded in the key). You can also use this chart to establish how much of your media spending (and/or effort) is being invested in each stage of your customer buying journey by adding your own stages as a key.
This example is purely for illustration and is by no means a perfect scatter of each channel. What you will hopefully see on your chart is a top right quadrant full of the activity that drives the most ROI.
Anything you see in that top right quadrant that doesn’t deliver a high proportion of revenue in the shape of new or renewing customers should make you question how much of your percentage of spending is being pushed in that direction and why.
Compare the positions of your chart to the amount of revenue typically driven by each activity. Is it roughly proportionate to the spending on each? If not, you know to act. If you don’t have the data to understand how much revenue is driven by each activity, that’s a critical situation to resolve.
In either case, engaging in this exercise will give you a clear set of next actions on how to make better decisions in deploying those precious marketing dollars.
How Can Credera Help?
Our Modern Marketing Transformation Practice at Credera is comprised of industry experts with decades of combined experience across all facets of marketing and technology.
If you’re investigating how to utilize the latest tech to invest your marketing budget more strategically, our team can help you assess your current infrastructure and identify opportunities to evolve, with commercially stunning results. To learn more, please reach out at email@example.com.
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