Although today’s business owners are inclined to see marketing as an expense, the view of marketing as an investment needed to drive results is more accurate.
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Peter Drucker, the father of modern management, 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 inclined to see marketing as an expense, Drucker’s view of marketing as an investment needed to drive results is more accurate.
Build a moat around your business
When organizations treat marketing as an expense, 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 quick sales wins, but they have minimal ability 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 retain that customer or draw customers after the ad has gone of print.
If you want your company to grow, 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 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 used for thought leadership.
Although these efforts may not produce short-term returns, they will certainly aid in strengthening your business over time. The problem is if you only look for marketing initiatives guaranteeing an immediate ROI, you will never plant any of these long-term marketing seeds needed to build the moat necessary for a sustainable competitive advantage.
Walking the walk
Examining my own life as a business owner, I have walked the walk while growing TribalVision. The reason TribalVision has achieved success is, 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, crafted TribalVision’s message, built a website making TribalVision look like an established company, developed an animated video to explain the why behind TribalVision, wrote white papers, developed numerous presentations, and crafted a 30-page marketing plan.
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 little else.
Looking back eight years later, although I can’t attribute a specific ROI to each of those assets, I know those investments have provided a much larger payoff than short-term guaranteed ROI initiatives.
Key takeaway
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 their empires.
Hopefully, you will view marketing as an investment. This very simple mindset can make the difference between gradual and dramatic growth.
