One of the instances that I fondly recollect from my days at Siemens is when we received an inquiry for a training programme from the HR director of a very prominent CPG player in India. Interestingly, he referred this enquiry to an activation programme we did almost two years back.
Irrespective of the order value of this enquiry, two years is a pretty long time to report ROAS. So the natural tendency is to attribute this enquiry to "other campaigns". Now, many of us in marketing and communications might encounter such incidents. But in the era of short-term tactical campaigns aimed at lead generation — how many of us plan for such incidents?
"Marketing is not an efficiency optimisation game. It is an opportunity maximisation game."
Rory Sutherland, Alchemy
Why Efficiency and Effectiveness Are Not the Same
Efficiency asks: "How well are we doing something?" Effectiveness asks: "Are we doing the right thing in the first place?"
Organisations can become extremely efficient at activities that contribute very little strategic value. This is one of the most common risks in modern marketing and revenue operations. Teams often optimise activity, reporting, workflows, and campaign mechanics — without fully questioning whether those systems are aligned with long-term business outcomes.
The danger is not inefficiency alone. The greater danger is becoming highly optimised around the wrong objectives.
The belief shared across many corporations is that marketing should effectively be a cost reduction and efficiency optimisation game — especially when profitability is in question. With multiple cost elements straining profitability, marketing spends end up focusing only on short-term, reactive, tactical, lead generation initiatives.
RoAS to a large extent depends on the profit margins of the offered product or service. If the profit margin is big enough, a lower return on ad spend is acceptable. But a small margin means advertising costs have to be low to achieve a higher return on ad spend.
A lesson from Factfulness
Hans Rosling reflects on an ethical dilemma in a hospital clinic in Mozambique in the early 1980s. He concludes: "Paying too much attention to the individual visible victim rather than to the numbers can lead us to spend all our resources on a fraction of the problem and therefore save many fewer lives."
The same principle applies to marketing resource allocation. In reality, when we are faced with the question of optimising resources, we focus on targeted and reactive activities. But as this approach suggests, we need to improve our chances of attracting a wider audience when given fewer resources.
Marketing Effectiveness Is a Long-Term Game
Many of us find short-term tactical campaigns re-assuring because that is where the data lies. Through a mythical linear marketing funnel, we can tap our customers to open their wallets. This myth could even prove true for those customers who are actively looking to buy. But how about new opportunities? New buyers? Should we not stoke their curiosity with a relevant story to remember our brand?
This is where Rory Sutherland's message starts resonating — and connects directly to Category Entry Points (CEP) and how successful brands are adept at making emotional and mental connections with consumers, uncovering new moments and moods to engage them, and thereby staying "mentally available" whenever they think of the category.
Make Your Brand Memorable
According to research from Professor John Dawes at the Ehrenberg-Bass Institute, 95% of B2B buyers are not in the market for your products at any given time. It debunks the myth that advertising creates immediate selling opportunities.
His argument: companies change their providers of services such as banking, legal advice, software or telecoms around every five years. This means only 20% are in the market for those services each year, and just 5% in each quarter. The other 95% are not in the market at all.
Dawes says advertising mainly works by building and refreshing memory links to a brand — rather than by directly driving sales. When customers are in the market, they remember brands that have advertised effectively in the past, usually over a long period. "If your advertising is better at building brand-relevant memories, your brand becomes more competitive."
Time the Consumer, Not Conversions
We cannot peddle our products to everyone — but neither can we wear blinders and focus only on niche target groups. This is where brand strategy (the hallowed Segmenting, Targeting & Positioning trio), the competitive framework, and customer research weigh in. There can never be great communication without a great strategy. And there can be no great strategy without knowing the consumer.
So while it is important that we micro-target the bottom end of the funnel to maximise conversions, this cannot be the only guiding light for marketing communications. Dawes urges marketers to target the category and reach all potential buyers, instead of hyper-targeting the 5%.
With the level of uncertainty in the market, short-term digital tactics seem like a haven to prove marketing effectiveness — especially if an organisation is focused on month-on-month growth. But this could prove fatal in the long term. Sooner or later, if these brands were to run a brand "fitness test", it will show that long-term brand values start depleting or appearing fuzzy. Competition starts appearing in areas of strength that were considered ours.
"Run your media at a leisurely pace, with budgets spaced over long periods, so that your brand is always fresh whenever buyers happen to enter the market."
The long and short of brand building
It somehow seems that we are drowning ourselves in so much theory, beta tests, conversion matrices, and efficiency — and forgetting that we are killing creativity, the instinct to create something new and give customers a new emotional experience. For that, we don't always need to micro-target or multiply marketing spending, but leave ourselves open to discovering new opportunities to engage our customers.
It's a long shot. But a sure one.
Sources
- Alchemy: The Surprising Power of Ideas That Don't Make Sense — Rory Sutherland
- Factfulness — Hans Rosling, Ola Rosling, Anna Rosling Rönnlund
- Advertising effectiveness and the 95-5 rule — John Dawes, Ehrenberg-Bass Institute