Marketing Strategy: What It Is, Why It’s Important, and How to Create One

For CMOs, the challenge is not just to “do more with less” but rather “do the right less” due to unpredictable macro forces and pressure from new, wide-ranging and ambitious enterprise objectives. CMOs must focus on resilient methods for strategy development that help them define and communicate marketing’s contributions to organizational objectives.

Four themes are essential for marketing leaders to implement in their marketing strategies this year and beyond:

1. Customer journey orchestration

2. Marketing’s shifting role in the enterprise

3. Strategic brand management

4. Change and volatility management

Developing a succinct and compelling strategy also requires a balance between a high-level vision that captures stakeholders’ attention and tactical guidance for the marketing team. CMOs must articulate their marketing strategy by sharing highlights without overwhelming business stakeholders with too much information.

A common marketing strategy structure is to nest business objectives, marketing objectives, marketing initiatives and related marketing measurements. But this approach has gaps in each area and leads to wasted resources and a misalignment of business objectives. It may look tidy and organized, but it’s masking underlying problems. A successful marketing strategy is cognizant of potential gaps and addresses them by:

1. Probing for the drivers behind business goals and identifying issues both inside and outside of marketing that must be solved for you to achieve your goals

2. Selecting the right marketing initiative to support business objectives

3. Selecting KPIs that accurately show the impact of marketing initiatives and connect back to the business goals they are designed to support

For more on marketing strategy, download: One-Page Marketing Strategic Planning Template

CMOs must prepare for the tough decisions required to address the economic headwinds that lie ahead. Even the most optimistic CMOs should be ready to make some tough cost decisions, especially in a volatile and changeable environment. To survive and thrive in the face of budgetary challenges, CMOs need marketing spend strategies that optimize costs, strengthen their ability to meet evolving business goals and deliver maximum business value. 

By cost optimization, we mean a continuous business-focused activity to drive structured spend optimization while maximizing business value. When done effectively, it seeks to improve efficiency and productivity, shifting spend from lower yield programs to those that can deliver greater return.

For marketing, that means assessing your spend in key areas such as agencies, media, martech, operations, digital commerce, campaigns, marketing analytics and projects — explore how each one supports (or hinders) the customer journey and influences business revenue. Consider what programs actively create marketing value versus those that merely support it. 

Take action now, even if your CFO has yet to start talking about reducing costs. The marketing spend playbook that you must adopt has to reflect the specific challenges that lie ahead. These essential steps should be part of your playbook to navigate economic headwinds:

• Step 1: Benchmark your budgets to identify how your current budget and spending stacks-up against peers and competitors.

• Step 2: Build your understanding on the changing behaviors of your customers, rapidly changing consumer attitudes and behaviors. Build your Build your voice of the customer (VoC) capabilities to track how economic uncertainty is impacting your customers.

• Step 3: Shore-up your scenario planning capabilities to build agile, adaptive marketing strategies.

• Step 4: Make an assertive case for the value marketing investments. Invest in marketing because it is essential to delivering results today and keeping your brands top of mind as buying cycles elongate and spending power is challenged. It also maximizes the chances of accelerating out of the economic headwinds tomorrow. Rather than accept that cuts are inevitable, make a confident and assertive case for strong and continued investment.

• Step 5: Cut marginal marketing costs. Build a cost management plan that balances potential fiscal benefits with risks.

• Step 6: Refocus your investments in media, agencies and technology. Identify the investments across marketing’s operating model that enable you to deliver efficiency today and growth tomorrow.

For more on marketing spend, download Marketing Cost Optimization Framework.

Marketing has traditionally been seen as a cost center rather than a revenue-generating function, which has led to CMOs having to justify investments and keep costs in check. Now even more so, as CMOs seek to restore their postpandemic marketing budgets.

To position marketing as a value-creator, strategies need to be informed by data and the use of consistent measurement frameworks. This prevents “cherry-picking” results, helps connect activities to the business and therefore helps articulate value to others.

However, calculating how marketing creates value can be elusive when trying to make a direct connection between a marketing activity (such as a digital campaign) and a business outcome (such as a sale). To show value, it’s imperative to deliver marketing metrics based on the roles and decisions supported — from the CEO, who needs to know about business outcomes, to campaign managers and analysts, who leverage granular metrics to optimize marketing tactics. Establishing a clear hierarchy of marketing metrics ensures the right people see the right measures at the right time — and are using those metrics for the right purpose.

If ROI cannot be easily measured, CMOs must frame marketing activities by the value they will deliver to business objectives. The key performance metrics for a demand generation program, for example, are more leads, higher quality leads and an increase in funnel velocity. The value of these metrics collectively can be measured as return on objectives (ROO). ROO is an alternative way of measuring value when marketers are unable to show the ROI either directly or indirectly. 

Using the right KPIs with the right people also helps drive more confident decision making, making it easier to evaluate activities, understand when and where to shift direction, and respond to new changes and challenges.

CMOs naturally assess the readiness of their teams to quickly adapt to waves of change. But too often, they turn to the extremes of full-scale reorganization or isolated, role-based hiring tactics to alleviate short-term pressures. Rather than focus on jobs or reporting structure, CMOs should focus on sourcing the mix of capabilities they will require to adapt and execute their strategic initiatives in the mid- to long term.

Accurately assessing capabilities and capacity requirements is a key component of strategic planning and is critical for proper execution. To develop adaptive marketing capabilities to deliver on your strategic objectives, implement these four major steps:

1. Identify capability gaps

2. Source capabilities

3. Align capabilities to structure

4. Evaluate impact and emerging needs

Identify capability gaps

Develop your own capability assessment to think about what capabilities your team will need to execute against your strategic plan. Collaborate with your leadership team and identify larger functional groupings of related job roles and specific skills or expertise, that will support the deliverables you require, create scenario plans for changes you anticipate and address how to resource or align those capabilities. 

Source capabilities

Determine how you will resource missing capabilities or capacity. You may invest in upskilling current employees, acquire the capability by hiring or merger/acquisition or partner to access the capability through agencies, freelancers, services or vendors.

Align capabilities to structure

Decide how to fit the desired capabilities for internal staff into your current organizational structure. Adding capabilities or redeploying talent doesn’t require a full-scale redesign. Instead, think about ways to incorporate them with the least impact to the existing organization. This will reduce disruption and the likelihood of change fatigue.

Evaluate impact and emerging needs

No matter how carefully you craft your organization design, it will need to adapt as your strategy changes. Rather than seeing organization design as a single project, you need to view it as an ongoing process that’s necessary to ensure that the capabilities of your team continue to adapt to support the requirements of your strategy.