Equipped with these tools, marketers in service industries can start to base strategic decisions on hard numbers rather than soft estimates. One bank, for instance, discovered that the vehicles it uses to acquire and retain customers yielded wildly different levels of effectiveness. It also found that results it had previously attributed to marketing were actually more closely related to its number of branches per capita. Another company drew on its ROI findings to slash its annual broadcast television budget from $70 million to $10 million, and to shift spending into cable television, online media, and sponsorship channels.
That level of understanding can enable chief marketing officers to engage more productively with the board and management in a common language so all can understand. And senior executives can use what they learn to better assess the performance of their marketing teams. The organizational and cultural legacies within most large financial-services companies, as well as those in many other service industries, ensure that building these capabilities will not be a simple undertaking. But the potential reward — an improvement of as much as 25 percent in marketing effectiveness — is more than worth the effort.
Joni Bessler ([email protected]) is a vice president with Booz Allen Hamilton in San Francisco. She specializes in strategy and operational effectiveness for financial-services companies.
Steven Treppo ([email protected]) is a principal with Booz Allen Hamilton in Cleveland. He works primarily in the area of growth strategy development with consumer packaged-goods companies, with a focus on analytical marketing.
Ashok Notaney ([email protected]) is a senior associate with Booz Allen Hamilton in San Francisco. He focuses on operations strategy for retail consumer and retail financial-services companies.