The role of marketing has undoubtedly evolved, as has the customer experience. Signing on the dotted line is now just the beginning. Businesses that understand that tomorrow's customers care more about the journey will come out on top.
As a result, chief marketing officers (CMOs) are forced to have an entirely new set of skills in their toolkit—namely, the ability to wear many hats at once.
It's about acting as a chief financial officer (CFO) to be strategic about when and where to invest marketing dollars for optimum ROI, acting as a product developer to ensure the solution matches the customers' evolving technical needs, and integrating sales expertise to ensure marketing is driving leads through the funnel.
So let's break down this evolution...
CMOs of companies of all sizes are now, more than ever, directly responsible not only for revenue but also for their contribution to profitability.
At the beginning of any planning period, every dollar requested by the CMO for Marketing's budget needs to be justified to the CFO/CEO, and every dollar spent needs to be accounted for. But once the budget is approved, the CMO and Marketing's performance will ultimately be assessed on a hard ROI metric by the end of the stated time period, usually 3, 6, or 12 months.
Until recently, that assessment was based on a series of volume metrics, such as number of event attendees or number of website visitors, and a choice of cost metrics, such as cost per lead (CPL) and cost per acquisition (CPA). But with increasing adoption of deep analytics and data visualization technologies, the most progressive businesses assess marketing's performance on the revenue-based metric of customer lifetime value (LTV) divided by the customer acquisition costs (CAC), or LTV:CAC.
To calculate the total cost of acquiring a customer (CAC), all expenses need to be considered, including digital marketing, content marketing and SEO, content creation, event management, media relations, influencer marketing, creative services, website development and maintenance, personnel, and other vendor costs.
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