Marketing is measuring
Dr. Andree K. Bates outlines five steps to becoming a more valued pharma marketer.By Sep 6, 2010 on
Dr. Andree K. Bates outlines five steps to becoming a more valued pharma marketer.
Sales and marketing teams are often among the first to be downsized when businesses face financial difficulty, and we have seen this time and time again in pharmaceuticals.
This fits with articles I keep seeing about sales and marketing being undervalued and unappreciated in pharmaceutical companies, even though they are the departments that bring in the business and the engine that supports the whole organization.
What is going wrong?
Given how many factors are involved when evaluating marketers performance, it can sometimes be difficult to calculate the incremental value a marketer brings to the brand and, in turn, to the business.
However, there are ways to measure the impact of the sales force on the market share of a brand and the overall company market share.
The same can be done with communications activities.
On top of that, if these are not strong, there are also ways to know exactly how to improve them for stronger results to the brand, the company, and the value of the sales and marketing teams.
So, what do the sales and marketing teams need to do to prove their value to the organization and ensure that they are not the focus of budget cutsand job cutsin a downturn economy?
1: Concentrate on assisting your CFO meet the need for predictable cash flow, steady growth, and shareholder value
By focusing on doing whatever it takes to ensure these three things are covered, sales and marketing teams will become the best friends of the CFO and the value will be inherently clear.
Focusing on how to grow your brand steadily, without increasing your cost base significantly, is the key to success here.
2. Ensure the CFO understands and can track how marketing is generating cash flow
Marketing teams need to ensure that the CFO has a means to track how they are making the company money and generating cash flow.
To do this, they need to have reliable metrics that tie the activities they are undertaking to the financial performance of the brand they are managing and the company.
3. Ensure regular contact between marketing and finance teams
If marketers are not communicating the value of what they are doing to the finance teams and CFO, then the latter teams are not likely to fully understand it.
They are not trained in how marketing grows companies; they are trained in finance.
Marketers need to ensure that the CFO has access to the key metrics that tie their activities to results on an ongoing basis.
4. Strengthen the analytical thinking and tools available to marketers
Analytical tools that tie sales and marketing decisions to actions and results are critical in todays pharmaceutical environment.
Companies need to investigate what tools are available to assist them in guiding sales and marketing decision-making, accurately identifying actionable decisions, implementing them effectively, and tying them to financial results.
Investigate the options available to you and find what suits your specific needs best.
5. Implement a marketing measurement system that is accessible to finance teams
Several years ago, when I did an analytics results presentation for a large brand, the company CFO came in.
I was surprised, and asked what his interest was.
He said, We spend so much money on sales force and advertising, I want to see what impact this is having. Makes sense!
Since then, more and more results presentations designed for marketing directors have attracted the attention of the CFO and CEO, and it is becoming a more regular event to see these two joining our results presentations.
This is good. This is what marketers needsystems of measurement designed for them to know what to do and the impact of what they are doing, systems that CFOs and their teams can also follow and understand.
We need systems that allow both finance teams and marketing teams to both understand what is happening and be able to discuss it in the same language.
Measure business results
Marketers must measure their effectiveness.
The inability of marketers to prove their value leads to skepticism, under-appreciation, and, potentially, the downsizing of the department in tough financial environments.
However, marketers can decrease this challenge by following the steps outlined above.
They need to focus on the key needs of the organization, use means to measure activities and prove value, and ensure ongoing communication with finance teams.
Many classic marketing metrics (e.g., intent to prescribe, share of voice, brand awareness, etc) can be used internally if you like, but these are not metrics to discuss with finance teams if you want to be valued and respected.
You must tie whatever metrics you are using to sales and profits.
Marketers need to focus on understanding where money is being spent and how these spends are affecting sales and profits if they really want to be valued and appreciated.
Sometimes, that requires new processes to be implemented.
However, these can be painless and will lead to being able to ensure (and prove) that your marketing investments are leading to real meaningful business results.
Dr. Andree K. Bates is CEO of Eularis which applies analytics to determine the sales impact of marketing programs.
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