Intentional Growth #332: Tying Your Marketing KPIs and Spend to the Equity Growth of Your Company with Jeff Campbell
Ep.#4 [THEME SIX]
Do you know what your return on marketing spend is and if it is growing the equity value of your company?
A lot of business owners see marketing as an expense because they cannot clearly connect the marketing spend to a return on investment (also known as return on ad spend or ROAS).
Today we have Jeff Campbell, co-founder of aiCommerce, on the show to walk us through what it takes to turn marketing into an investment. Jeff is the perfect person to speak on this topic because he has been an agency owner, sold his business, and now invests in–and manages–companies and brands.
Jeff is one of the only people I have been able to have a dynamic conversation with about marketing strategies AND financials all at the same time ;-) He truly “gets it” and breaks it down in a way that should give anyone hope that marketing doesn’t have to be a money pit and can, in fact, be an engine for equity growth, if done properly.
The three main takeaways of today’s interview are: 1) identifying the right KPIs, 2) how to calculate your contribution margin so you know how much it costs you to deliver your product or service, and 3) how to test different advertising channels while maintaining your desired ROAS. In addition, Jeff breaks down the very few levers he pays attention to when market testing a new product or service.
Marketing shouldn’t be a guessing game. If you can understand how much it costs you to deliver your product and the lifetime value of a customer, you can market with a clear outline of what works and what doesn’t.
If you want to answer the question: “How much money should I spend on advertising, with which products, while maintaining x margins, while maintaining and growing cash flow?” then you will want to tune in to this episode as well as the next one ;-)
// WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast
What You Will Learn
- How to think about marketing as an investment and not an expense.
- What costs go into marketing and why the ROAS calculation is flawed with many brands.
- The different types of marketing that brands (companies) should be doing and why revenue should not be top priority.
- Jeff’s metrics (KPIs) that matter when scaling a company’s valuation.
- What contribution margin is, how to calculate it, why it matters, and how to use it.
- How to intentionally invest in marketing when you know the lifetime value of your customer.
- When and why breaking even on marketing can be a good strategy.
- How to integrate your marketing roadmap into your financial roadmap.
- How to think about your ROAS and the cash flow implications on different products and services.
- Jeff’s recommendations on how you test different channels and platforms.
- The levers that Jeff pays attention to with online advertising to improve the overall conversion rate.
// USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment
Bio:
A proven marketing executive with an entrepreneurial approach, Jeff is responsible for strategic vision, client services, P&L management, revenue growth, talent development, and the overall success of business operations at aiCommerce.
Jeff’s background includes strategy development, media integration, and attribution for brands such as Mercedes, Lowes, Apple, Disney, and FedEx, activating across search, social, SEO, and programmatic media platforms. Prior to aiCommerce, Jeff co-founded Resolution Media, Omnicom’s performance marketing arm and a top three global partner of Google and Facebook. His teams’ marketing innovations have been well recognized with industry accolades that include Cannes Lions, Digiday Sammies, Effies, Clios, Shorty Awards and more.
Interview Quotes:
14:28 - “The more you spend in [Amazon] ad-spend. The more you take advantage of their advertising opportunities, the organic visibility goes up.” - Jeff Campbell
16:29 - “Not every sale is a profitable sale.” - Jeff Campbell
17:04 - “Revenue is vanity and profit is sanity.” - Jeff Campbell
25:10 - “This is definitely specific to the world of Amazon where there is a relationship between ad-spend and organic visibility.” - Jeff Campbell
35:30 - “One of my favorite quotes is, ‘At the root of all anger is violated expectations.’” - Jeff Campbell
36:00 - “Have a road map. Understand what a crawl, walk, run looks like.” - Jeff Campbell
37:58 - “Is the overall marketing pie getting bigger? Usually the answer is not…then the slices have to change.” - Jeff Campbell
49:22 - “Time is my biggest limited resource.” - Jeff Campbell
50:33 - “I’ve actually seen the smaller and the mid-sized companies doing this well. It’s the big brands that aren’t.” - Jeff Campbell
Links and Resources:
Jeff on LinkedIn
The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision)
Intentional Growth™ Financial Assessment
You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.