by Tim Bourgeois of ChiefDigitalOfficer.net
It’s the second week of January and excitement about the new year seems to have waned. And for good reason, at least for marketing and sales executives, because that means it’s time to figure out how to meet aggressive new targets.
As you charge into 2015, here are few reasons to consider working a digital marketing audit into your plans.
1. Your CEO Is Going To Start Asking Questions About Digital Marketing
In November, blue-chip consultancy McKinsey & Company published Five Ways To Get More From Digital Advertising. In it, the author wrote: “In our experience, companies may be leaving as much as 20% to 30% of potential [digital advertising] returns on the table.” This is noteworthy for CMOs for two reasons:
a) While undeniably smart and powerful, McKinsey isn’t known for marketing innovation. So if the firm is talking about digital marketing inefficiencies publicly, the cat is out of the bag. And as a category leader, that means other consulting firms are going to quickly follow suit.
b) When other leading management consulting firms begin promoting the topic, too, the message will eventually make its way to most CEOs. Or worse: members of the board. And this is a daunting thought for any CMO at a Global 5000 company – the stomping ground of management consultancies.
With digital activities accounting for about 25% of overall marketing budgets these days, the possibility of a 20%-30% boost – equal to about $5 million for a $500 million business – is going to get the CEO’s attention.
2. You Don’t Want To Be Playing Catch-Up on This Issue
The last thing you need is someone like me getting called in by the board or CEO to do a digital audit.
While you might find the idea of an audit to be distasteful or an unnecessary distraction – after all, no one ever enjoys an ‘audit’ – it’s preferable to the alternative. When I’m engaged by non-marketing entities (CEO, President, CFO, Procurement) to do an audit, the initiative becomes increasingly complex before it even begins. Getting out ahead of this issue is the only real option for marketing executives.
3. Objectivity Is In Short Supply
It isn’t easy to find a resource that can assess a digital marketing operation in its entirety, with a credible level of objectivity.
- The big ad agencies have expertise in all of the established digital marketing categories, but they’re not in the consulting business, and only really cater to the Global 1000 with huge budgets.
- Smaller digital companies number in the thousands, but sell targeted point solutions – think marketing automation tools or programmatic media buying solutions — with sophisticated and compelling pitches, because they are typically well-funded by venture capital and need to grow fast.
- Even the most capable senior marketing staff member probably only has expertise in 4 or 5 digital categories, while the entire digital ecosystem consists of about 30 components.
4. If You’re Not Confused, You’re Not Paying Attention
Google makes 500–600 changes in its search algorithm each year, most of which go unannounced. The marketing technology landscape continues to mushroom, and now has 1,876 vendors in 43 categories. Microsoft’s Bing has been slowly but steadily increasing its presence and now accounts for about 30% of all U.S. search engine activity. And internet advertising in the U.S. grew 17% during Q3 2014, registering the “highest quarter on record,” according to the IAB.
On the talent side of the equation, Wired recently reported that 90% of corporations lack digital skills, and Korn-Ferry research found that senior digital professionals will be in the highest demand in the C-suite this year.
5. (Practically) Every Other Group Is Already Doing It
A digital marketing audit might seem like an odd concept at first pass, but the reality is that audits are commonplace in many areas of a corporation.
The most obvious audit is of course of the financial variety, but this is legally required for most large organizations. However, a quick look at Wikipedia shows the many flavors of audits: performance, quality, IT, risk, energy, compensation, etc. The concept is far from new or innovative, though for some reason it isn’t pervasive yet in marketing.
6. Your CFO Will Love You For It
The CMO Survey conducted each year by The Fuqua School of Business at Duke University tells us that all marketing expenditures (online + offline) will account for between 7.7% and 17.0% of corporate operating budgets in 2015. And that digital marketing spending will grow at about 10%, while offline advertising will remain flat or shrink.
This makes the digital marketing line item – already sizable at ~25% of the overall marketing budget, and growing quickly – a natural target for CFOs, who loathesizable and growing budget line items. So it shouldn’t take much effort to convince him or her to authorize funds for an audit, and it might even help you curry favor in the process.