Make marketing matter to the board
Guest post by Rick Oppedisano
Your company’s Board of Directors should care about marketing.
But the truth is, they probably don’t. When focused on the right things, marketing can provide a real and tangible value to the Board. Here are 4 ways to drive revenue and create real shareholder value around the marketing function.
Differentiation is a business decision made at the highest levels, and is tied to sustainable competitive advantage — a way of adding value competitors cannot easily duplicate. Get involved in creating this vision and apply it consistently across the enterprise. Position yourself as the caretaker of your company’s differentiator- good companies constantly evaluate their positioning and make adjustments or refinements as appropriate. Compile a quarterly analysis on your differentiator that shows you’re firmly grounded in marketplace reality: everything from product mix, product selling advantages vs. competition, perceptions of channel partners, customers and the market at large.
It is the equity that marketing builds within the organization that often makes the difference between the Board appointing marketing to a seat at the strategy table on the one hand—and marginality on the other. Become a catalyst across multiple parts of the company with the intention of helping the business as a whole respond to a changing marketplace. Spend time with your development team, share the latest market data and help them pursue value and differentiation in their work. Meet with your operations team to make sure they understand your company’s external sales message and their vital role in following through with your brand’s promises. Always ask your managerial peers how you can help. If used correctly, the data and communication vehicles that marketing has at it’s fingertips can create a winning culture focused on an understandable, achievable vision.
Keep An Eye Upstream
A farmer whose livelihood depends on a river flowing through his land will be concerned with the upstream situation, especially if the river could be diverted to a neighbor’s property. Keep a pulse on competitors, mergers, acquisition and other market activity that could affect the Board’s investment. Map out your target market and messaging strategy, and update them quarterly as their pains and challenges change. Maintain a profile of potential acquisition targets- get to know their business and position yours as a logical value-add. If your Board wants to know what future cash flow will look like, they must know where it comes from- the market.
Build a Valuable Brand
Branding is a very effective catalyst for better leadership and it can help the boardroom drive a shared vision. A strong brand can increase cash flow by increasing market share, reducing promotional costs, and allowing premium pricing. I was reading a Harvard Business Review article recently that defined brand equity as “the commercial value of all associations and expectations (positive and negative) that people have of an organization and its products and services due to all experiences of, communications with, and perceptions of the brand over time.”
For me, brand equity is most evident when 5 key factors, working simultaneously at a high level, shift the demand curve to achieve a price premium or a market share gain.
Some Boards look at marketing as a necessary evil, just another cost to manage. Stand out and create value by adding higher-level strategy to the items measured in your organization. Think about focusing marketing metrics around business outcomes. Develop quality metrics that will help you provide insight into how marketing is making a contribution to the company. Then, demonstrate that contribution to the Board.
Originally posted on Rick Oppedisano’s blog, The Marketing Muse