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“What’s the ROI on my marketing?”
You’ve either asked that or been asked that question, I’m sure.
The problem with that, as David Meerman Scott, explains wonderfully in his PDF, Lose Control of Your Marketing: Why marketing ROI leads to failure , is that when you ask for ROI before you do anything, you are stifling innovation.
If you’re looking for new ways to create raging infernos of customer word of mouth (or as he calls them “World Wide Raves”), you have to continually try new things.
You never know what is going to “go viral” or what isn’t, as I argued in Dandelion Marketing, so you are better off trying a lot of things to see what works.
But, if you keep asking for ROI before you try, since there’s no answer for something that has never been done before, you won’t get the novel approaches you need.
Now that I think about it, David’s argument pushes me even further into the realm that Dandelion Marketing is the paradigm for marketing orgs in the future.
If you spend $100k on something (or want to), you need to justify the cost…if you do 100 activities and they each cost $1000, you’ve spent the same amount of money, but you’ve diversified your risk and increased your odds. No one campaign requires the justification and you’ve put in place a mechanism to increase your odds of ‘going viral’ (aka a World Wide Rave.)
Now, we’ll leave aside the question of whether Marketing is supposed to drive ROI or objectives (as Augie Ray and I contend) for the moment.
That’s not to say that data and metrics have no part in marketing…as Jay Baer points out, they certainly do, but that’s different than ROI.
From a marketing perspective, you’re better off
- allocating a budget
- putting in an Agile Marketing Development process
- creating a culture that tolerates failure
- encouraging testing with a focus on business objectives
than demanding ROI on all of your spend upfront.
