1) The marketing industry was hit hard by the economic crisis as marketing budgets were cut by over 50% in some countries. However, marketing has emerged stronger from the crisis by proving its value as an investment rather than just an expense. 2) Marketers realized they needed to show the financial return on marketing investments in order to keep marketing divisions relevant. This led to the rise of ROI (return on investment) marketing, which focuses on quantifying the impact of marketing on business financial performance. 3) More companies have now adopted ROI marketing practices and evaluate marketing's financial returns. As a result, the marketing industry overall is stronger after the crisis than expected, as marketing is now seen as a more important investment.

1. Pablo Turletti
CEO, ROI Marketing Institute
Lucerne, Switzerland.
December, 2014
Marketing, an industry that is
coming out stronger from the crisis.
How a whole industry is reshaping the way it delivers thanks to
the tough times.
When the crisis hit the fan, it spread all over... Very few sectors did not get hit by it and on
the way to pass through during the last six years, many industries failed to reshape and
disappeared, several struggled and still struggle to survive, few were untouched, and very few
came out, or are coming out stronger. Marketing is one of these last ones. It may seem obvious
that if companies stop advertising their products and brands they will sooner or later start losing
sales. Yet, one of the first things companies did during the crisis was to cut down on marketing
budgets. In some countries marketing spending went down more than 50% as it was considered
that cutting down on marketing expenses had limited if any, social costs for the advertising
companies and would have a fast a easy-to-see impact on the bottom line of the business. It may
have been so, but only for the short run. While delaying the string of firing that came as a
consequence of the lack of cash flows, reducing marketing expenditures, did transfer the
immediate social cost done to the marketing agencies that we're providing those services.
Agencies disappeared by the hundreds and the big multinational firms started very early in the
crisis to reduce their labor forces. There was a need to act urgently if marketing was to play a role
in the economics of businesses in particular, and in the recovery from the crisis in general. The
only and fastest way to do this was to prove that marketing was, and still is, an investment rather
than an expense or a cost. Marketing needed to show its contribution (rather than short term
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2. influence) to the bottom line of the business in addition to is usual impact on the brains of
consumers. This is a rather steep climb for an industry that was used to measure its performance
with indicators that are marketing tactics related. All players (service providers and advertising
companies) were accustomed to, and accepted without questioning, results measured in terms of
brand awareness, gross rating points, opportunity to see, click through ratios, attendance,
affiliation, impressions, etc. All these indicators meant nothing to the General Manager or CEO
struggling to keep up with a shrinking balance sheet and down-sliding profit and loss statements.
Very soon, marketers discovered that there was the need to show the financial return of
marketing investments in order to keep marketing divisions afloat, and above all, relevant. And
this was the beginning of a still going process of retransforming the whole industry. It marked the
beginning of a new performance indicator and of a new way of doing marketing: ROI
Marketing. ROI Marketing means that marketing should not only focus on communicating
messages in search of calls to action, but also delivering and measuring its impact on the bottom
line of the business. This way, marketing shall be able to quantify not only its "impressions" but
also its cash inflows, real cash inflows (as opposed to "valuation" so typical of public relations
projects). The industry soon discovered that by embracing ROI Marketing, they could not only
show marketing's contribution to the three dimension sustainability (economic, social, and
environmental), but also acquired a strong tool to negotiate budgets. If marketers can proved the
money their projects and campaigns generate, General Managers could no longer cut down on
marketing investments so easily. Now there is an opportunity cost that is quantifiable and
quantified. By treating marketing as an investment portfolio, companies can evaluate projects and
campaigns in a different way, a financially accountable way. Training, certification, and system
implementation are at the base of becoming "ROI Marketers" and the industry soon started, and
still works on, using ways to discover the financial return of their marketing activities. This is how
marketing, within the most developed businesses, became a stronger voice and a relevant and
accountable division.
The marketing efforts of today are far away from the techniques and scope of the
marketing used only five to ten years ago. Technology and social habits transformation played a
clear role in this evolution, but this is not the only thing that has changed. The biggest and most
relevant players in most industries and sectors have already systems, practices, and procedures to
determine the financial returns of their marketing investments. As a result, the marketing
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3. industry as a whole is coming out much stronger from the crisis than anybody could have
forecasted during the bad, tough times of budgets cuts. The marketing of today is much more
relevant than the past one. Marketing is reshaping and will still reshape not only responding to
new technology and social habits and skills, but also by changing the nature of its relationship
within its own environment, the companies that are using it and considering it as an investment
rather than as a cost. In which side of the "line" (this time a different line) is your company now?
Is your business practicing and evaluating marketing with the same performance marketing
metrics than before, or is your business or company practicing ROI Marketing? In the answer to
this question may lay a big part of the future of your business or of your career...
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