Chasing the Wrong Ad Goal: Why CEOs Should Care and How They Can Eliminate the Problem

Ad efficiency is defined as the “ratio of the cost of advertising to the number of people reached.” The problem lies in the fact that, by definition, “ad efficiency” represents quantity, not quality.

Moving your company’s marketing efforts along the scale toward quality requires a top-down approach to reprioritization that only CEOs can command. We suggest four areas of focus.

Demand sales, not eyeballs. Ensure that your advertising efforts are aligned with the their purpose—to sell more stuff—and request metrics that only report how the marketing cycle is directly affecting sales. If the right tools are not in place at your company to make that connection,approve your CMO’s request to acquire them and for the staff to receive any necessary training.

Focus on the best customers. Being able to prove the worth of all the paths that lead to sales ultimately requires a single view of the customer across the entire company. This way, your marketing team can clearly and accurately evaluate customer value, and ensure that the company is growing relationships with its most loyal, profitable customers—not the easiest new customers for a digital network to acquire (again, eyeballs).

Force a reality check on media. Are you investing in media (which is most companies’ biggest investment after people and plant) the way customers actually use it? People are drawn to content. That’s a power owned by branded networks with reliably targetable viewers. Yet, there are ad technologies that offer up aggregations of audiences as if the content doesn’t matter. Ensure that your marketing efforts are tapping into the media that your customers are loyal to. Don’t assume your CMO understands your customers better than you. Ask questions about who, what, when, where and why.

Once and for all, eliminate silos. Marketing, sales, operations, finance and technology must all work in lockstep to fully understand, reach and retain key customers. When you meet with your CMO, bring all departments together to participate in the discussion and ensure that everyone is working toward a holistic customer strategy, one that’s based on quality, not quantity.

Ensuring your advertising is effective and efficient is the job of the CMO. Ensuring your marketing is achieving the vision of the company can be improved with the input of the CEO.