Shouldn’t all Marketing Programs Generate a Return? From Cost to Profit Center Marketing

by Debra Andrews | August 6, 2020

Making the move from cost to profit center marketing is not an overnight switch, it’s a journey.

In this post I’ll define the various stages of a typical B2B marketing journey, and the elements that should be incorporated into a marketing program to move it from a cost center to a profit center.

The Marketing Department Operating as a Cost Center

Many businesses at the start of their marketing journey have no marketing, or are doing some traditional marketing activities but not seeing a return on investment.

In this scenario, marketing is simply a “make it pretty” department, producing materials like sales collateral, proposals, and presentations. The marketing department focuses on putting sales in the best position when they are in front of a prospective client, but does not place an emphasis on increasing the amount of leads coming in.

Moving into a Lead Generation Stage of the Marketing Journey

Where things start to get interesting is when marketing is charged with proactive outreach. Typically at this stage, there are emails, social posts, public relations, and virtual events but the marketing activities are still a bit scattershot. Marketing is bringing in some leads but there’s nothing strategic about the program.

We call this stage the “break even” phase as it involves outreach, which is a starting point for lead generation, but there’s no optimized system in place, no automation, and no real visibility into what’s working or what could be working.

The Demand Generation Stage of the Marketing Journey

When you get into the demand generation stage of the marketing journey, you’re entering the profit center stage. In this stage, the marketing team has dialed in on what’s working and there is consistent, effective outreach, resulting in a significant amount of lead capture.

The core pillars of any effective marketing program – strategy, technology, talent, and processes – are squarely in place. New leads come in through gated content and there are lead nurturing workflows in place to recognize what the prospective buyers are interested and feed them more content around that topic. This personalized, smart automation tactic not only builds trust and credibility in the eyes of the prospective buyers, but also provides valuable insight and clarity to both the marketing and sales departments.

Profit center marketing involves moving cold leads to a state where they have intent, what is known in the marketing world as sales qualified leads (SQLs). Those SQLs are passed to the sales team to turn into opportunities. This “closed loop” funnel with the sales team – where no leads ever leak out – results in a positive and significant marketing ROI. 

The Marketing Department Contributing to Enhanced Valuation

Enhanced valuation is where marketing begins to predictably generate revenue. The program has been “optimized” through careful testing and measurement.  There’s an understanding of how many new leads per month come in and how they move through the funnel. 

At this stage, marketing understands conversion rates and so the revenue pipeline becomes predictable. Having a “lead generation machine” enhances a company’s valuation. Marketri has worked with a number of companies that looking to sell, and their marketing program has become part of the valuation equation.

Ready to Build a Predictable Revenue Funnel?

Marketri’s proven team delivers results-driven consulting services that turn marketing departments into profit centers. Contact us or download our brochure below to learn how we can help transform your marketing function into a profit center that drives revenue and increases the value of your business.