Marketing ROI is essential for evaluating the effectiveness of campaigns, yet its complexity often lies in the multidimensional impact marketing has on a company’s overall success. While traditional measurements focus on revenue generation, marketing goes deeper, influencing brand perception and long-term customer loyalty, intangibles that are difficult to measure in hard numbers.
Marketing might drive future sales by building trust and credibility, but the link between a campaign and revenue growth may not be immediately visible.
Customer journeys are increasingly non-linear, making attribution difficult. A customer might interact with various touchpoints, both digital and physical, before making a purchase. This layered approach dilutes the clarity of direct marketing-to-sales tracking.
A 2023 Nielsen report found that only 34% of marketing executives felt confident in their ability to measure ROI accurately, highlighting the ongoing struggle across industries.
Marketing’s true long-term value
Effective marketing must have the ability to create compelling brand stories that resonate with customers on a deeper level. Unlike campaigns that aim for short-term gains, these stories cultivate brand loyalty and turn one-time buyers into advocates.
A powerful brand narrative can differentiate a company in crowded markets, helping it to attract and retain customers despite competitive pricing or product offerings.
Research from Harvard Business Review reveals that 64% of consumers cite shared values as the primary reason for building a relationship with a brand. Strong brands like Apple and Nike excel by consistently telling stories that align with their customers’ identities and aspirations.
Long-term growth trumps short-lived sales surges
While short-term sales spikes can provide an immediate sense of accomplishment, they often don’t result in sustainable business growth. The real value of marketing is measured over time through the strength of customer relationships and the quality of the experiences delivered.
Building brand loyalty and improving customer lifetime value (CLV) are key indicators of long-term success.
A Bain & Company study showed that increasing customer retention rates by just 5% can boost profits by 25% to 95%. Marketing efforts should, therefore, aim to attract customers and keep them engaged and returning, increasing the overall profitability of the business.
Balancing brand awareness and quick wins in marketing strategy
Within marketing teams themselves, there’s often a balancing act between long-term brand-building efforts and the pressure to deliver quick, measurable results. On the one hand, brand awareness campaigns are key for positioning a company in the marketplace, creating recognition, and laying the foundation for future sales.
Marketing departments are frequently tasked with driving immediate conversions, often leading to strategies that favor short-term promotions or campaigns.
Effective marketing requires a strategic blend of both. When investing in brand equity while leveraging data-driven tactics for short-term wins, companies can make sure they are building a sustainable customer base while still achieving immediate business goals.
How different departments see marketing’s role in business growth
Marketing plays a distinct role in every department, but its perceived value often varies depending on priorities and outcomes. For Finance, the focus is almost exclusively on revenue growth. Marketing initiatives are evaluated based on their contribution to the company’s top and bottom lines, with finance teams emphasizing ROI and cost-efficiency metrics.
For the Sales team, marketing’s value lies in its ability to generate qualified leads that directly convert into business. Sales departments depend on marketing to create awareness, stimulate interest, and deliver prospects that are ready for conversion.
IT departments, on the other hand, see marketing as the critical interface that translates technical product features into benefits that are easily digestible for end-users. As Warren Street of U.S. Bank noted, IT develops the product, while marketing ensures its value is communicated effectively to the market.
The varied lenses through which marketing’s impact is viewed shows the need for a multi-faceted measurement approach that can satisfy each department’s expectations.
Driving business-wide impact with smart marketing initiatives
A strong brand attracts customers and builds loyalty and advocacy, which are key in maintaining a competitive edge. Frank Mesa of Microsoft highlights the importance of compelling narratives and creating unforgettable experiences that resonate with consumers.
Companies that craft unique brand identities set themselves apart from competitors, allowing them to command premium prices and build lasting relationships.
Strong brands inspire action, influence buying decisions, and create loyal advocates. According to a study by Edelman, 81% of consumers say they need to trust a brand to buy from it, showing the clear financial benefits of brand trust and loyalty.
When investing in the right brand-building strategies, companies make sure that their products and services remain top-of-mind for consumers in a crowded marketplace.
Telling stories that build trust and spark customer action
After generating leads or driving sales, marketing adds value by creating stories that build trust and inspire action. In industries where customer trust can be hard to earn, marketing’s ability to communicate credibility is invaluable.
Brands that successfully establish a narrative of trust see improved customer retention and improved brand equity.
Delivering memorable customer experiences further strengthens these stories, as positive experiences turn consumers into lifelong customers. Studies show that 86% of buyers are willing to pay more for a great customer experience, reinforcing the idea that marketing must do more than advertise, it must deliver value in every interaction.
Using marketing to multiply business success and build resilience
Marketing is a long-term investment that pays dividends well beyond the initial expenditure. Unlike many operational expenses, marketing has a compounding effect, building over time to create brand loyalty, customer retention, and continued sales.
Michelle DeFeo, President of Champagne Laurent-Perrier US points out that marketing proves its worth during tough times.
Companies that have invested in marketing are better equipped to handle unforeseen challenges and maintain customer loyalty when faced with external pressures, such as economic downturns or supply chain disruptions.
Investing in consistent marketing efforts helps companies mitigate the impact of rising costs or competitor actions. Customers are more likely to stay loyal to a brand they trust, even when prices increase, creating a buffer against market volatility.
Marketing shields your brand in times of crisis
Marketing also acts as a buffer during crises. In times of unexpected challenges, such as supply chain disruptions or economic shifts, brands that have built strong connections with their customers through marketing are better positioned to maintain loyalty and protect market share. These companies are less vulnerable to competitors’ discounts or sudden changes in pricing.
During the COVID-19 pandemic, businesses with strong marketing foundations were more resilient. A Kantar report found that companies that continued to invest in marketing during the pandemic experienced faster recovery and growth compared to those that slashed their marketing budgets.
Marketing protects brand equity and helps brands emerge stronger from crises.
