Chris Moerdyk
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Chris Moerdyk
Marketing Tips

Marketing audits can improve return on investment and efficiency

With marketing costs having gone up substantially in the past few years, more and more boards of directors and non-marketing CEOs are demanding answers with regard to actual returns on investment and measurement.
Gone are the days when marketing directors or managers were simply allowed to take their annual budgets and use them in the way they saw fit with their non-marketing colleagues assuming the money would be efficiently spent and not really trying to understand what marketing and its often mystifying component called advertising were all about.

An example of this trend was when I was invited last year to deliver a breakfast presentation to members of the SA Institute of Chartered Accountants on what marketing was all about, I expected maybe a dozen or so accountants to turn up. But, such was their interest in the subject of marketing that 450 of them packed the hall.

And the reason for their interest is simple. Marketing budgets are far too big these days for anyone to ignore. On top of which, the collapse of the Marketing Federation of SA, continuing controversies in the media over advertising campaigns being banned for all sorts of seemingly mystifying reasons by the Advertising Standards Authorities and news such as that Budweiser campaign which won the biggest international advertising award and was then found to have actually lost sales and market share, has prompted a lot of non-marketers to wonder whether marketers actually know what they are doing.

All of which has given rise to the marketing audit, which sounds grand, complicated and expensive but which in fact is a relatively simple and fairly inexpensive process.

Interestingly, not all marketing audits are commissioned by non-marketers. Nowadays, marketers are using them to ensure that their boards and non-marketing counterparts are happy with the way things are going.

Marketing audits can consist of a full blown independent review of marketing structures within a company in terms of efficient use of manpower and resources, along with looking at what measurement tools are in force and how ROI is established. In addition full audits can look at relationships between the company and its marketing service suppliers, such as ad agencies, events and PR companies and so forth.

One of the biggest audits I have conducted so far was for KWV some years ago when it started moving from being exclusively an exporter of wines to looking at the domestic SA market. This involved a review of the company's marketing activities going back a decade, its current activities, marketing structures and relationships with marketing suppliers to an in depth assessment of its future marketing strategies.

While one would think this sort of audit would upset suppliers and marketing departments, it doesn't. Quite simply because more often than not they also need to have something to convince non-marketers that they are on the right track.

Marketing audits often arise out of corporate frustration between marketers and non marketers, both of whom are suspicious of the other and all of whom need something to bring things back into focus, logical perspective and generally defuse tensions. All in the interests of increasing efficiency.

Marketing audits can also involve quite simply having an independent sounding board for strategies, ideas, structures and measurement tools. Meeting frequently enough to be effective but not enough to be disruptive.

Apart from a number of clients who retain me to act as a regular sounding board, there is even a CEO who, not being a marketer, found himself continually confused by the marketingspeak used by his own marketing staff and even more confused by strategic and creative presentations from his advertising agency.

My "undercover" job is to translate what his marketers and ad agency are telling him into language he can understand and then suggest appropriate responses.

Other clients retain me to continually audit costs and recommend ways of containing these.

The secret of successful marketing audits, I have found is to keep them simple and focussed. There is always the temptation by some consultants to make the process as complicated as possible in order to make audits as lucrative as possible. They however, soon find out that while many corporate executives might well not know much about marketing, they certainly know when they are being milked and these relationships never last long.

The thing to remember is that marketing is nothing more than a checklist. It isn't magic, it isn't smoke and mirrors. Its actually something, I have found, that accountants often eventually understand more than marketers do. Because it is a very simple, clinical and logical process of ensuring that every element of marketing is working in synergy. Marketing audits ensure that nothing has been overlooked or left out and that everything is measurable.

The bottom line is that marketing is not just about big ideas but rather return on investment. As companies like Unilever and other big global brands will tell you - because that's precisely what they do.
7 Feb 2007 18:02


About Chris Moerdyk

Apart from being a corporate marketing analyst, advisor and media commentator, Chris Moerdyk is a former chairman of Bizcommunity. He was head of strategic planning and public affairs for BMW South Africa and spent 16 years in the creative and client service departments of ad agencies, ending up as resident director of Lindsay Smithers-FCB in KwaZulu-Natal. Email Chris on moc.liamg@ckydreom and follow him on Twitter at @chrismoerdyk.