Back when variety shows were a staple on television, sometimes they’d feature a guy who could keep a dozen or so plates spinning on the end of sticks without any crashing to the floor. This is an apt metaphor for what it’s like to work in marketing these days. While variety show audiences were fairly certain the guy wouldn’t drop any plates, CEOs aren’t so sure. Four out of five of them report feeling a lack of confidence in their CMOs.
The marketing function may be impeded by antiquated organizational design, poorly defined role descriptions, a corporate culture that devalues marketing’s contributions, and inadequate skill sets. It doesn’t have to be this way. Changing these dynamics requires building a culture of growth and performance.
That’s simple in theory, but judging by the high rates of CMO turnover, the concept is anything but simple in practice.
Performance Marketing Defined
The first thing to get out of the way is the notion that performance marketing can only mean user acquisition. Though that may be true in some companies, customer acquisition is only one type of performance.
Here’s a better way to think about it: performance marketing means delivering a measurable impact on moving customers from one stage of the funnel to another.
Take branding, for example. Branding is so much more than “getting your name out there.” Building a strong brand enables marketers to stay top-of-mind with their target audience, including those who may not be in the market to buy when they see an ad but who will buy at some point. When they do, having a strong brand can create a mental shortcut that makes it easier for them to buy.
Working in brand marketing has evolved beyond buying cheap impressions. Impressions are an important input, but performance marketers care about both inputs and outputs. The right output for brand marketers? Driving more customers over time at lower CPVs (cost-per-site-visit) or CPIs (cost-per-app-installs). Brand marketers can still measure increases in aided and unaided awareness, as they have for decades. But, if you use linear TV, now you can measure your impact with the mother of all metrics: sales.
Performance Marketing Means Adapting to Change
Here are some of the most notable changes brand marketers should consider as they become performance-minded:
1. Redefining their role: In organizations that equate performance with user acquisition, the notion that brand marketing teams can contribute to sales might cause tension. CMOs should be prepared to give their brand marketing teams the permission they need to treat TV as contributing to the company’s growth engine. In other words, when done correctly, it should be treated as an investment to maximize, not a cost to minimize. Absent that air cover, many brand marketers may continue to just buy the cheapest-possible impressions above all other considerations.
2. Client-agency goal alignment: In a world in which TV advertising is unaccountable for producing business results, the only thing that a client and agency can impact is cost. The moment a marketer figures out how to use advertising to increase sales, though, she will care about one thing: maximizing that sales metric. If her agency still prioritizes costs, misalignment will get in the way.
3. Tap into customer data through partnership with the CIO: It’s possible to build TV target audiences based on website and app users. In many organizations, the CIO or CTO might control that data. Maximizing ROAS (return on ad spend) requires data- and privacy-secure access to this data, and that may require a marketing partnership with the CIO or CTO that does not currently exist.
4. Modeling attribution: How much should a marketer spend on TV, digital, paid social, or retail marketing? Building the right attribution models for these channels, including TV, will be essential to prove business results and spend at the right levels in these channels.
While making these changes requires effort, the payoff can be enormous. That’s especially true when it comes to TV advertising. For too long, TV has been one of the largest line items in a brand marketer’s budget, yet it has been the last to be optimized for performance.
Addressing this isn’t easy, but once they do, marketers can truly change the way they approach their work, build reputations based on proven performance, and ultimately grow their careers and their brand.
Curious to learn how you can cater campaign optimization to drive the business metrics that matter most to your brand? Click this link to learn more about Simulmedia’s performance optimization strategies.
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