While marketing is often viewed as a cost center, ROI helps reframe it as a revenue driver, showing how it can be a catalyst for strategic growth and long-term sustainability and success.
Financial services marketers must often justify their budgets and initiatives to a leadership group focused on the bottom line.
Marketing spend is one of the most significant line items on the P&L, often accounting for up to 10-15% of revenues. Yet, if you’re unable to demonstrate a clear financial return on your marketing investments, securing senior-level buy-in for campaigns, technology, or resources can be challenging.
For Chief Marketing Officers, maintaining a strong, trusting relationship with other members of the C-suite (including the President/CEO and CFO) is a key to unlocking marketing dollars and accelerating growth for the entire organization. In fact, research by BCG and Facebook in 2019 found that strong CMO-CFO relationships can result in financial improvements of 20% to 40% .
In this article, we help marketing leaders define, measure, and explain marketing return on investment (ROI) in ways that resonate with executive stakeholders.
- What is Marketing ROI?
- Why the C-Suite Cares About ROI
- How to Explain Marketing ROI to Key Stakeholders
- Making the Case for Marketing ROI
What is Marketing ROI?
Marketing ROI measures the relationship between the revenue generated from marketing efforts and their cost. Here is a simple formula:
(Revenue Attributed to Marketing – Marketing Costs) ÷ Marketing Costs = Marketing ROI
ROI is one of the most powerful measures of impact because it quantifies a marketing campaign’s value in terms of hard dollars and cents and clearly demonstrates whether it is profitable.
Community banks and credit unions can track a variety of metrics to determine the ROI of their marketing campaigns. These may include new deposit account openings, loan application growth, and member/customer growth. Cross-sell/up-sell success is another measurement that can be tracked in several ways—in terms of new products or services added as a percentage of new relationships, existing customers/members, or volume growth quarter over quarter.
When calculating marketing ROI, don’t simply focus on short-term lifts in revenue. Also make sure you’re tracking the development of meaningful client relationships and brand equity over time.
Why the C-Suite Cares About ROI
Senior banking leaders—including Presidents, CEOs, CFOs, Board members and others—prioritize three metrics of success above all others: profitability, efficiency, and strategic growth.
Growth on its own can be defined in multiple ways—in terms of increased market share, net new members or customers, and geographic or product category expansion.
When it comes to marketing spend, C-suite leaders want to see that the organization’s investments are driving quantifiable, measurable business outcomes, not just impressions, clicks or social media engagements. While marketing is often viewed as a cost center, ROI helps reframe it as a revenue driver, showing how it can be a catalyst for strategic growth and long-term sustainability and success.
How to Explain Marketing ROI to Key Stakeholders
As a marketer, you are a skilled and adept communicator. Now is the time to put your powers of delivering clear, concise messaging to the test! Here are 5 keys to explaining the financial impact of marketing strategy to your organization’s top leaders:
1. Speak their language: CEOs and CFOs use financial lingo on a daily basis. Use terms like profit, revenue, cost per acquisition, and marginal return to help move perceptions of marketing from that of a “soft” discipline to one that delivers real, hardline value. Focus on tying marketing outcomes to organizational goals like loan growth, deposits, member/customer growth, share of market, and retention.
2. Share clear, concise data: In your conversations with senior management, focus on providing high-level, impactful analysis that demonstrates the real-world impact of your marketing campaigns and returns against budget.
For example, say “Our mortgage campaign brought in $5 million in new loan applications with just a $20,000 spend.”
Easy-to-read visual reports, such as interactive dashboards, graphs, and charts, can support your case in a powerful, persuasive way.
3. Show the “so what?” When presenting to the C-suite, it’s important to go beyond simply reporting on activities. Make sure to also explain the impact.
For example, instead of stating that an online deposit campaign delivered 5,000 unique visits to your website, say, “This campaign didn’t simply drive traffic to our website—it resulted in 300 new checking accounts, which supports our annual growth goal.”
4. Provide context: People have difficulty understanding marketing impact in a vacuum. To gain buy-in and support from your colleagues, come armed with benchmark results that compare the performance of your current campaign with those of past initiatives and industry standards.
It’s also helpful to share anecdotal evidence and qualitative outcomes like increased brand awareness and positive community engagement alongside quantitative figures to add color to the conversation.
5. Anticipate questions: Before your next meeting with the C-suite, come prepared with a list of potential objections and your responses. Here are some common questions you might receive:
• What was the total cost of this campaign?
• What’s the projected lifetime value of new members/customers added?
• How does this initiative support our strategic plan?
• Is there a more efficient way to generate growth?
• If you had budget for only one marketing campaign this year, what would provide the greatest impact?
Making the Case for Marketing ROI
Making the case for marketing ROI is a journey, not a destination. To build a positive, productive relationship with your CEO and CFO, you must talk up ROI regularly and consistently throughout the year, not just at year-end.
Seek out opportunities to present results directly to the C-suite, and (if appropriate) to your Board. Report on ROI in a consistent, visual format that is easy for busy executives to digest. Involve leadership early—ask what metrics matter to them and be sure to align your marketing proposals with the organization’s strategic business priorities.
Above all, focus on getting your colleagues excited about marketing and the positive impact it is having on your financial institution. Celebrate the wins and demonstrate how your campaigns are showing continuous improvement.
Remember that showing clear, relevant marketing ROI builds trust and support. When the C-suite sees marketing as a strategic investment that generates consistent, measurable returns, it will open the door to bigger budgets and bolder support of your department’s critical role in the organization.