Teradata’s Enterprise Priorities in Digital Marketing report shows a couple of interesting learnings, as aggregated and summarized by Econsultancy. Read further about the three key learnings and the one that caught my attention the most.
The three key learnings according to Econsultancy on Teradata’s report are:
- An unprecedented demand for technology
- Experience plays a larger role than data when it comes to budget decisions
- The upward trend for marketing and advertising will continue into 2015
I’d like to point out to the second finding, the elaboration on it by Econsultancy is:
Although a data-driven model is being pursued by enterprise companies, past experience plays a huge factor in influencing budgets.
As we have discussed already, decisions on budget allocation should be driven by data. However as budgets are handed down from year to year, from manager to manager, it’s difficult to make radical ‘overnight’ changes. Instead budgets adapt and change incrementally.
Unfortunately as marketing conditions continue to change rapidly, the non-dynamic businesses with unsupportive budgets will not succeed. A transformative approach to budgeting is key.
The last sentence is interesting, from a transformative approach. If a new way at looking at budgeting is needed, driven by data, then budgeting –as we know it now- does not have its place in a new business world.
Why not have a budget as a baseline only or maybe just for the less-performance-based approaches, but as long as performance and results are being met (holistically) there should(/could) be no (need for) marketing budget, you should have a constant flow of spend.
Look at it this way, retailers also make sure their products are not sold out, constant stock is being provided when products are nearly sold out. Why can’t we apply the same principle to marketing budget. Marketing channels are like the retailer, a distribution channel. Keep the supply up by keeping the marketing “budget” flow open.
Take into consideration of course business growth objectives, stakeholder objectives and what more, the only thing I am saying is that “budget” should not be a constraint, which in too many cases now, it is. I’ve worked with this approach now a few times with success, some others (from a supply side perspective) are offering marketing-performance-based engagements, based on the same foundations.
Be aware that such an approach needs the right operating model in place, the right type of people, systems and processes to enable and support a performance-driven business.
Context is key to take into account, and for big companies this might be harder to achieve due to the many flows of money, but if you want a transformative approach to budgeting, it’s not data, it’s getting rid of budget itself.
How do you cope with the limitations of marketing budgeting? |
