Peter Drucker, known as the father of modern management, once said, “Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs.” Although today’s business owners are often inclined to see marketing as an expense, Drucker’s view of marketing as an investment that is needed to drive results and find new customers is more accurate.
When organizations treat marketing as a cost, they focus on short-term sales and ignore the long term. Most of their marketing dollars go toward tangible, paid media purchases, for example, an ad or a click on Google. These expenditures might provide short-term returns, but they have minimal ability to continue to drive value after the money has been spent. A print ad placed in a trade magazine may result in a sale, but it is unlikely to help to retain that customer or to continue to draw customers after the ad has gone out of print.
If you want your company to continue growing, your goal should be to build as much of a moat around your business as you can. This is achieved by continuous investment of marketing dollars into your company’s owned assets. Such investments may include: updating your message and website every year, producing customer video testimonials for use as sales tools, developing a series of educational webinars, and investing in the development of relevant content that can be used for thought leadership and for SEO [search engine optimization]. Although these efforts may not produce short-term returns, they will certainly aid in strengthening your business over time. The problem is that if you only look for marketing initiatives that guarantee an immediate ROI [return on investment] – consistent with a view of marketing as an expense – you will never plant any of these long-term marketing seeds needed to build the moat that is necessary for a sustainable competitive advantage.
Examining my own life as a business owner, I have “walked the walk” while growing TribalVision. The reason TribalVision has achieved such success is that, from day one, I’ve understood the importance of marketing in order to unlock dramatic growth. Before even opening the doors for business, and with little money to spare, I wrote a book, spent months crafting TribalVision’s message, built a website that made TribalVision look like an established company, developed an animated video to explain the “why” behind TribalVision, wrote multiple white papers, developed numerous marketing presentations and crafted a 30-page marketing plan to identify and capture new business. If I had viewed marketing as an expense rather than an investment, I never would have done any of these activities. I simply would have started TribalVision with a business card, an average 10-page website and not much else, which is what most startups with little money do.
Looking back seven years later, although I cannot attribute a specific ROI to each of those assets, I know that those investments taken as a whole have provided a much larger payoff than I would have earned by only focusing on short-term, ROI-only initiatives.
If we are to build something great, we must take a leap of faith – a calculated leap of faith but a leap of faith nonetheless. If Howard Schultz, Steve Jobs, Richard Branson or Elon Musk invested only in efforts backed by guaranteed results, they never would have built the empires that they have. Hopefully, you too will view marketing as an investment. Of all the marketing tips out there, this very simple message and mindset can make the difference between gradual and dramatic growth.
Chris Ciunci is founder and managing partner of TribalVision, which has offices in Warwick, Boston and New York.
