Many CEOs view their marketing department as a cost center when, instead, they should be looking at it as an asset.
“If you’re thinking your marketing is only about generating brochures, designing ads and building Web sites, then you are sorely underestimating the business opportunities that a savvy marketer can bring you,” says Jonathan Fisher, CEO of BrandExtract. “If you’re not being challenged, if new and existing business models aren’t being discussed as part of your strategic plan, if your key executive decisions and board strategies are not being enhanced by the marketing department, you’re creating a gap and you’re losing a major opportunity.”
Smart Business spoke with Fisher about how to stop viewing your marketing department as a cost and move it to the asset side of your balance sheet.
How can a CEO turn the marketing department into an asset?
Marketing becomes an asset on the balance sheet when it supports your key business goals, raises the valuation of your business, attracts investors or buyers, or shifts your culture to align in a new executive direction. Businesses want to identify new opportunities in the marketplace and new ways to create barriers to entry for the competition — and marketing can offer insight and analysis. If marketers keep their eyes open and understand how to take an opportunity and convert it into something that can generate a revenue stream, marketing can play a bigger role than most CEOs realize. Marketing should have an impact on aligning strategic business goals and differentiating the company in the marketplace. If you’re not demanding this from your group, you should.
How can thinking strategically increase the value of marketing?
Most marketing departments think far too tactically. That’s when they’re looked at as an expense. It’s only when they start thinking strategically and aligning themselves with revenue streams, measuring executive directions or shift, and dealing with business valuation and investment capital that they truly become an asset.
As a CEO, you need to ask, ‘How is marketing going to make this company more desirable in the marketplace so that someone will want to buy it, or invest in it, or merge with it?’ When you get to that level as a marketer, you’re having a powerful conversation with the CEO and the board of directors.
Moving from tactics to marketing strategies can be a challenge. It’s easy to rush out and build a trade show booth, collect business cards and push them over to the sales force. You have to keep challenging the classic scenarios. We presented one client with a 100 year evergreen marketing program that cost virtually nothing to start. The program was viral and allowed them to ‘own’ a solution in their market. If you’re sending out postcards every month for $10,000, you have to ask why. If you’re trying to achieve top-of-mind awareness, again, ask yourself why. Would it be better to focus on incremental revenue strategies? You should be asking, ‘Is there a more effective way of achieving market awareness or growth, and one that could achieve more?’