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The 5 key elements of a financially measurable marketing plan

Over the last 15 years as a Marketing Director I have managed B2B marketing budgets varying in size form £1.5m to almost nothing. Recently when working with smaller organisations with tighter budgets I've realised that I achieved far more per £ from smaller budgets than larger ones. When you don't have much budget you tend to focus hard on those activities that will make the most difference, whereas, with a large budget you can unknowingly be drawn into activities that actually make no measurable difference at all. 

So how can you assess how much to spend?

There is an overused quote about consumer marketing coined by Lord Lever which says "Half of my marketing is wasted; I just don't know which half".

In business to business marketing this shouldn't be the case. With the adoption of digital marketing, CRM and other tools marketers should now be able to attribute a financial returns figure on just about everything they do.

With this in mind here are my top 5 elements for creating an effective and measurable marketing plan.

1. First and foremost marketing plans need to be built on and aligned to business goals.

Whether it's revenue growth in new business or existing customers, reducing the cost of recruitment, launching a new product or selling the business; the marketing plan needs to be aligned to these goals.

2. Revisit marketing plans every year from the ground up.

Avoid taking last year's budget and making adjustments up or down. Start afresh with those activities that will make the most difference to achieving the goals and work in tandem with sales to ensure it's aligned.

3. Try to assign a financial value or return to every element of marketing activity.

Every effort should be made to assign a financial benefit to each activity. This isn't always straightforward, and sometimes requires some assumptions, but going through the exercise will at least demonstrate that you understand the basis on which an investment is being made. If there really is no identifiable financial return on an activity then at least you can make a decision knowing that this is the case. (see example plan layout)

4. Full budget assessment

Once a plan is constructed based on business objectives from the ground up using financial measures you and the board can make an informed choice on priorities when finally setting the budget. Also when the inevitable "exciting sponsorship" or "must do entertainment event" crops later in the year, an intelligent decision based on cost/benefit can be taken in the context of the whole plan.

5. Build KPI's and quarterly reviews

Monitor every month using key performance measures such as number of leads, no of appointments created and value of sales generated as a result. Every quarter you should review what has been spent, the realised and projected returns as well as the forecast for the rest of the year. It can be a painful process but it is essential to avoid overspend  

All of this sounds like a statement of the obvious, you are right it is; but I rarely see the above in practise. Frequently plans are created where activity that is not aligned to sales or business objectives, huge sums are spent on "PR opportunities" with little or no idea of a return, or alternatively the marketing budget is hijacked as the "entertainment budget" for sales.

Often a list of activities is produced without any financial measure against them with the excuse that "it's not possible to do". Whilst assigning financial measures to marketing can be challenging it is an essential exercise without which marketing will be seen to add little or no value. On the other hand when completed and assessed after 12 months you will know some really key statistical measures such as, how much marketing spend you need on average per £ generated in sales; a really useful figure.

Example plan layout

By Steve Birch


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