What the board and executive management should know about marketing
it is important that both executive management and a company’s board possess a degree of basic knowledge about marketing.
Marketing is fundamentally about making a company’s goods and services visible and attractive to a defined target group in a defined market. We have been doing this since the dawn of time. in the previous century, marketing was largely based on branding and advertising. The objective was to build a solid brand name and use traditional media and methods to communicate the message in such a way that the products attracted relevant buyers. It was generally agreed that marketing could be both necessary and sensible, although it was often difficult to see a clear and measurable connection between investments and the actual impact on the company’s bottom line.
The old statement about how 50% of marketing worked – although it was unclear which 50% – was not far off the mark. These days it is an entirely different story…
Marketing has changed radically
Even though marketing continues to be based on the same principles, the way in which marketing is practised has changed radically. Over the last 10–15 years in particular, we have noted an extreme development largely associated with the use of data, technology and new communications platforms. Companies that have acknowledged this and grasped the opportunities that have arisen have seen a clear connection between marketing and increased turnover and customer loyalty.
The board and executive management should possess basic knowledge about marketing
As marketing can be a growth accelerator for a company, I would assert that both executive management and the board of a company should possess basic knowledge of marketing. They should be able to put marketing on the company’s agenda, put the right people in place and dare to allocate sufficient funds to implement what – following closer analyses and evaluation – is shown to be the right initiatives for the business.
Executive management and the board should harbour no ambitions to become marketing experts as there are many complex sub-disciplines. It would be more expedient to engage with expertise and reliable associates, and be able to ask the right questions.
Here are a few topics that executive management and the board need to be familiar with and be capable of addressing:
- That the company has a good, relevant product with a clear value message directed at a clearly defined target group in a market that Is actually willing to pay. This takes priority over everything else and represents the first stumbling block for many people.
- How does your marketing strategy suit your business model? B2B? B2C? Direct sales? Web-based sales? Low end? High end? Price strategy?
- These days, a lot of marketing can be measured in pounds and pennies, although it requires both tools and skills to set up and implement. How is this practised in your company?
- How visible are the company and products/services online? It is easy to perform some basic tests yourself by conducting Google searches on the products sold and other relevant keywords. Remember to also check the most important competitors as a reference!
- Does the company have a clear marketing strategy and marketing plan with specific, measurable, budgeted and concrete activities?
- What type of technology and tools are used for marketing? How does this tie up with the rest of the business, for example, in a CRM system that provides control of customer data across business areas?
- Is the company covered in the key areas necessary to conduct up-to-date marketing? Management? Digital media? Analysis? Content?
- Does the company test and optimise activities, messages and channels?
- Sales, marketing, support and product must work together in the company in order to create an optimal customer experience. How does this work today? Do you measure customer satisfaction, and if so, where and how?
With a basic level of understanding, interest and the ability to ask the right questions, you can go a long way. Then you can help discover opportunities as well as ensure that investment is made at the appropriate level for the company.
Marketing does not necessarily have to be very expensive, but it can certainly become expensive if you are not discerning about what you invest in. If you are confident that you have a skilful marketing director at the helm, you can safely leave it to this person to ensure that the operational work is conducted using both internal and external resources. It is the marketing director’s task to create a good team as well as navigate through a world of opportunities, pitfalls and fancy words and Expressions.
Grounding and involvement from the CEO and CFO are essential
Companies that invest in and succeed in marketing generally have a CEO and one or more parties in management and the board who recognise the value of marketing. These parties are also often willing to contribute to the work that involves everything from PR, lectures and blogging to content sharing on social media. In turn, the most important factor of all is a basic understanding, backup and investment. The marketing director should be invited to present to the board at least once a year in order to inform them about what is happening and being prioritised, as well as the results achieved by the team.
The CFO should also be mentioned. Without a CFO who believes in and supports the marketing plan, it will be difficult to achieve sufficient wiggle room. Having said that, I would say it is as much the marketing director’s responsibility to clarify the effect of marketing and keep the decision-makers informed and updated about marketing activities and results. A good marketing director is able to connect marketing and growth and establish good relationships with other parties in the organisation and in the management team in particular.
Good marketing leads to more new customers, a higher price per customer, increased upsales, less customer loss and better customer experience overall. Perhaps you need more marketers or new skills within marketing in order to achieve the sales targets for the upcoming period?