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This post was contributed and sponsored by Tableau.
Despite years of vetting and advances in media measurement, analytics, models and attribution, Forbes research—with over 800 CMOs and 50 subject matter experts—revealed that most CMOs still struggle to quantify and communicate the value marketing creates to their leadership, peers and partners.
According to the Forbes study, a universal consensus reported that the lack of common standards and practices for measuring how marketing investments contribute to enterprise value limits business leaders’ abilities to make critical strategic tradeoff, reallocation and risk investment decisions.
For CMOs wanting to remain competitive in a dynamic and rapidly changing marketplace, here are five things they should consider:
No. 1 There is a clear connection between marketing investment and enterprise value.
Evidence from financial markets as well as academic and commercial research has demonstrated there is a clear connection between marketing investment and activity and enterprise value, which can be quantified and optimized.
No. 2 Marketing strategy and investments can contribute over 50% of enterprise value.
The economic contribution of marketing investment and activity to enterprise value in an intangible and digitally driven economy is large—as high as 50% of enterprise value—and growing. This happens when brand, customer and digital assets are properly valued and the impact of marketing performance, collaboration, and perceptions of innovation on financial outcomes is measured.
No. 3 CMOs must play six roles to fully realize firm value and growth potential.
Expectations for CMO performance have expanded dramatically beyond the traditional CMO role and scope to accommodate changing customer behavior, new channels, the growing role of data and technology and the importance of organizational collaboration. While a CMO acting alone cannot maximize growth, a fully empowered CMO should have primary responsibility for six big value drivers including stewardship of the brand, voice of the customer, digital roadmap and effectiveness of marketing investment.
No. 4 Highly accountable marketing organizations are building 12 organizational competencies.
Marketers who pursue higher levels of marketing accountability are achieving 5% better returns on marketing investments and over 7% higher levels of growth performance. The Forbes research identified 12 common organizational capabilities that these high-performance marketers are developing to leverage the data, systems and marketing services partner relationships. These are critical to evolve their marketing performance measurement systems to a best-in-class model and improve marketing accountability.
No. 5 Every organization can create value by being more accountable.
Every organization can take immediate steps to maximize the contribution of marketing to enterprise value and generate profitable growth by improving marketing accountability. Specifically, this research identified five actions every organization should take to better understand, measure, steward and enhance firm value.
For more insight from this study, check out our detailed report with Forbes “Marketing Accountability: A CEO Blueprint for Driving Enterprise Value by Maximizing The Effectiveness of Sales and Marketing Investments, Strategies and Actions.”
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