Defending Your Budget, One Metric at a Time
“If you don’t have any trouble getting the budget you need, this is not the program for you,” says Wharton marketing professor David Reibstein. The faculty director of Wharton Marketing Metrics™: Linking Marketing to Financial Consequences explains that marketing executives who do have to sell and defend their budgets will learn to improve those skills.
“Marketing Metrics helps executives determine how much to spend on what and how build a rationale for their budget. Understanding how to measure your efforts — and there are many ways to do that — and then communicate the economic value you bring to the organization are key strengths many marketing executives need to improve.”
Reibstein, who co-wrote Marketing Metrics: The Definitive Guide to Measuring Marketing Performance, says the program has evolved to include new metrics that utilize big data and leverage technological advances. “Wharton marketing professor Peter Fader teaches a session on how to measure the value of your customers, and how to allocate resources based on who is providing the greatest value. Kartik Hosengar, an expert on the digital economy and internet marketing, explains web metrics. These are relatively new analytics, and their value needs to be clearly understood by the rest of the firm.”
Fader, author of Customer Centricity: Focus on the Right Customers for Strategic Advantage, says confusion about customer centricity can put up a wall between marketing and the rest of the organization. “When you talk about retention, attrition, churn, satisfaction, and loyalty, you need others to understand what you are talking about. You need to be very clear about what these concepts mean and how they work together.”
But vocabulary alone won’t help you get your budget. Fader explains that it is the technical content — the analytics — that the rest of the organization needs to have an awareness of, and marketing executives are in a great position to show them. “2015 is seeing serious movement in analytics. It is a rapid transformation in business today, and we at Wharton have an obligation to help marketing executives learn how to better understand how analytics works and what they can do with it.”
Reibstein’s work on brand value also comes into play. “We spend a lot of time talking about brand because building it is one of your core goals. No matter what kind of marketing efforts you’re making, you need to know how you are affecting them; measure your efforts in terms of the value they add to your brand. We will show you how to make a strong case for your budget with a quantitative view of the value you are creating.”