The challenges facing enterprise marketing are: the effect of mass advertising is decreasing, the number of media and sales channels is generally increasing, people's trust in advertising is declining, consumers are multi-tasking, and digital technology makes people more capable of controlling their media time. . These trends also make marketing audiences and marketing channels more fragmented. For marketers, the danger is that this dispersion will at least reduce the traditional practice of communicating information to consumers through TV commercials, and the worse result is a waste of time and money. As a result, frustration spread among marketers, and it is difficult to agree on what to do next. Some people turn to the marketing mix model and use sophisticated econometric methods to differentiate the different impacts of marketing mix on performance. However, future returns forecasts made using historical data used by these methods are not necessarily reliable.
In a scatter-oriented marketing environment, marketers need more rigorous marketing programs, abandoning the way of thinking and behavior that followed the golden age of advertising, no longer regard marketing as “expenditureâ€, but marketing as a real investment. In other words, the return on investment (ROI) of marketing must be increased. Using the same principles as other functional departments, the CMO can better align marketing objectives with financial goals, take advantage of the brand's more distinctive elements to achieve greater success, and more accurately target consumers and Media channels generate greater and faster returns, control risk more carefully, and track sales returns more closely. In short, the chief marketing officer can meet the complex challenges faced by applying the basic principles of investment in marketing in a prudent and systematic manner.
The return on investment problem stems from the golden age of mass advertising in the 1960s and 1970s. The various rules established by marketers at the time have deeply influenced many marketing investments or marketing expenditures. When television dominates the world, marketers and advertising companies naturally focus on a large audience of popular shows. But other media marketing programs other than TV have received little attention. Marketers in the golden age often rely on next-day memory surveys to track advertising and compare the results with internal standards to assess the effectiveness of advertising. Later, people discovered that memory is not a better measure of creative effectiveness. Therefore, some leading companies have developed more cumbersome and complex testing systems, such as the Audience Response System (ARS), which is a new information to determine compared with competitors. Persuasive method. At the same time, more accurate coverage and frequency assessment methods enable media spending decisions to be made with more information.
In a world where the audience is basically passive, information can be effectively communicated, there is enough room for growth, consumer behavior is consistent, and the competition is fully understood, this well-established marketing model in the golden age of advertising has been very effective: Prioritize, control risk, and then measure the impact of marketing spending on consumer perceptions.
Marketers should now reach consensus on how to apply investment principles, such as clarifying investment objectives, finding and leveraging economic leverage, controlling risk, and tracking returns. These investment principles have long been widely used in other parts of the enterprise. Applying these investment management principles to the marketing function in a situation where the audience and the media are scattered, you can have a clear and coherent overall idea of ​​the total marketing expenditure of the company. Following these principles can also help marketers to make specific interventions in economic leverage with higher return on investment, thus reducing the dilution of the dispersed environment. Smart marketers don't blindly copy these principles, but cleverly apply these principles to the needs of marketing efforts. Marketing investments should start with the same questions. Answering these questions helps to align the marketer's goals with the company's overall goals, which is especially important when marketing needs to re-establish relationships with broader business objectives. If companies need to achieve their overall goals through the growth of joint business, marketing must motivate more people to embrace corporate brands and extend this business relevance to a broader range of products.
In order to solve the increasingly acute problem of optimizing certain investments in different brands, different media channels, different time spans, and different success criteria, it is necessary to distinguish between “maintenance†and “growth†for different market segments and different media channels. aims.
“Maintenance†marketing investment refers to the lower marketing expenses that enterprises need to maintain their competitive position in the market. When determining the appropriate level of “maintenance†marketing spending, consider the level of spending by competitors, the S-curve analysis, and the procurement cycle. “Growth†marketing investment refers to the marketing expenses that enterprises need to increase the market share of a certain brand, drive incremental consumption or attract new customers to use certain products. While it may be difficult to distinguish between these two types of investments, the principles involved in adopting such practices often promote valuable internal dialogue and ultimately help the chief marketing officer implement economic rules.
Over time, savvy marketers are better able to categorize investments, determine appropriate “maintenance†marketing investments for different categories, and allocate “growth†marketing investments to products that generate higher returns. . The key to economic leverage is to allocate funds to businesses that generate higher returns. For marketers, the economic lever is to determine marketing information and marketing spending based on the more attractive elements of the brand. As a result, marketers can more accurately target information to consumers and carriers that offer larger and faster returns, which is especially important when media channels and segments are proliferating. Finding and leveraging economic leverage can help marketers realize how significant it is to increase brand awareness and increase brand loyalty, which segments generate greater profits for the business, and are more responsive to marketing programs, and Which stage of the consumer decision funnel is in these segments.
Identifying the brand drivers, which are key factors influencing brand image and consumer loyalty, can improve revenue and profit if improved. While most marketers know which drivers are their brands, few of them really use these drivers to manage their multimedia marketing programs, and few have evaluated specific drivers at specific stages of the consumer decision funnel. The impact of consumer groups. Fortunately, sophisticated analysis techniques such as structural equations or path modeling can help marketers analyze the historical results of marketing plans and gradually increase brand drivers. In fact, brand drivers can be used as a comprehensive indicator of whether a brand's marketing media and information are valid and consistent with corporate strategy.