Dear Sir
In his article "Working with dinosaurs" (CB March 12), Paul Kitcatt has touched on a key area for all marketing professionals: how can we continue to justify significant marketing spend in a climate where every penny is scrutinised, and the only evidence for effectiveness is a collection of measures developed by marketing professionals, for marketing professionals?
Outside the advertising agency and the marketing department, these measures have little weight, and contribute to the impression that marketing is a "woolly" discipline that has little to do with the delivery of the ultimate financial goal - the creation of shareholder value. Many senior executives do not realise that marketing decisions are one of the primary drivers to shareholder value.
By focusing on value-based marketing strategies, marketers can drive superior returns in both the short- and long-term. Properly used, marketing levers (such as product and service innovation, advertising spend, PR and promotions) and assets (such as brands, relationships and channel partnerships) drive shareholder value through increased long-term cash flow, sustained growth, improved returns on equity invested and reduced uncertainty. Most companies could and should stop promoting value-destroying products and building value-destroying customer relationships.
PA's research and work with clients clearly demonstrates that it is crucial for both marketing directors and CEOs to understand that driving sustained shareholder value relies upon effective, value-driven marketing strategies.
Anit Roy-Choudhury, PA Consulting Group
