Most financial institutions use a combination of metrics to measure return on marketing investment. However, these measurements aren’t standardized across campaigns or marketing groups, so it’s hard to compare performance. It’s time for a new approach to calculate what’s working. Chief marketing officers need to be able to clearly link marketing spend to business results, and our approach can help CMOs make that connection.
The US financial services spends enormous sums of money on marketing. According to one projection, the industry spent $8.77 billion in 2016 on digital ads alone. Are these budgets being wasted? Hard to say, but we do know that financial institutions have a tough time measuring the success of their marketing investments.
As it stands, CMOs can usually get a read on an individual campaign in isolation, but they struggle when it’s time to compare the results of marketing campaigns across products. And, the current metrics that marketing groups use to measure success aren’t linked to financial results. Without clear metrics and common goals across the organization, there’s ample opportunity for waste.
Financial institutions must rethink the way they assess the marketing function. They need a systematic approach to calculating the real return on marketing investments. We recommend the following steps to get started:
Measuring the true value of the marketing function can be a complex undertaking. However, following these steps, CMOs can begin to address stakeholders’ concerns about ROI of marketing investments.
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Principal, FS Digital and Customer-Driven Transformations, PwC US