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Marketing ROI
Book

Marketing ROI

The Path to Campaign, Customer, and Corporate Profitability

James D. Lenskold
McGraw-Hill, 2003
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Editorial Rating

7

Qualities

  • Innovative
  • Applicable

Recommendation

In the past, marketing professors often taught that companies could not hold their marketing managers responsible for the success or failure of promotional programs. Numerous external variables that these managers could not control – including delivery problems, poor retail displays, sales slumps, competitors’ moves, buyer psychology, and so on – could undermine their outcomes. Marketing managers were off the hook when it came to results, particularly return on investment (ROI). Times have changed. Today, every corporate dollar matters and companies demand accountability from their marketing professionals. If a promotional program doesn’t work, its manager will quickly be out of a job. Strategic marketing consultant James D. Lenskold provides his tactics for calibrating marketing ROI, plus a basic “marketing ROI formula” you can use (with variations and, perhaps, some hands-on expert help) to quantify the returns you derive from your marketing efforts. Though his mathematical formulations can be daunting, his accessible work explains a logical methodology for measuring marketing programs’ results. Thus, getAbstract recommends this practical book to CEOs, CFOs and all marketing executives.

Summary

Real Returns: Always Important, Now Critical

Think of marketing not as an expense, but as an investment for which you expect a favorable return. Otherwise, why spend money on it? Some executives think that projecting a reliable return on investment (ROI) for marketing isn’t possible and believe that no one can quantify “marketing ROI” in hard financial terms. Yet businesses routinely demand precise ROIs for expenditures on plants and equipment, as well as complex technology initiatives. So why not marketing? Given that nowadays accountability is king, heed these basic marketing ROI principles:

  • “ROI is the ultimate measure for guiding marketing investments” – A sound, sensible, “strategic and tactical marketing decision” requires a reliable ROI metric.
  • “Marketing ROI is unique” – Unlike large capital investments, your overall marketing expenditure depends on numerous “small investment decisions.” ROI is a refreshingly straightforward measurement of financial return in relation to marketing expenses.
  • “Marketing ROI must be a primary [competitive] measure” – How you spend your marketing dollars...

About the Author

James D. Lenskold heads a strategic marketing firm. Previously, he worked at AT&T, where he helped develop innovative marketing.

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