Marketing: The undervalued or the engine room?

One of the areas in marketing I am immensely passionate about is demonstrating the strategic value-creation philosophy of marketing. By definition, this implies that marketing is more than just sales or advertising, and definitely more than just a P&L expense. Marketing's standing in a firm goes beyond being merely a  business function - it is the driver of the long term sustainable and profitable growth for companies.

Given that marketing must be responsible for long-term growth and profitability, its domain, by definition, can't be restricted to advertising or sales. On the contrary, I look at it as an all pervasive discipline spanning all functions in the company.  However, in reality, there is a high variance in how companies define and treat the marketing function. 

Through my personal observations, I have built up a typology of the different roles marketing plays in companies. Simply put, these can be classified as : the undervalued, the underdog and the engine room. 

The first category is the undervalued. Here, marketing is viewed merely as a communications tool. For these companies, marketing is little more than advertising and promotions, with its main purpose being to influence consumer decision making. I have also observed that it is in these companies that there is the highest pressure to justify marketing ROI and the highest risk of marketing budget cuts, demonstrating the lack of belief and support for the function by senior leadership. Naturally, these companies also tend to be less sophisticated in their marketing organisation and practices.


Then the second category is of the underdog. Here, the marketing function is viewed as a challenger, with increasing emphasis placed on contemporary marketing philosophies and practices. Marketing in these companies encompasses consumer insights, product innovations, strategy and pricing, and is often leveraged to drive long term business growth. The marketing organisation tends to exhibit a high degree of sophistication in these companies. However, inspite of this, marketing lacks a seat on the table in these companies. Finance usually pips marketers in winning top leadership roles in these companies.


And last but not least - I like to refer to the third and most influential role of marketing as the engine room.  Here, marketing is more than a business function - it is the single most important driver of market share, growth and profits; it is a mindset of winning in the marketplace through robust consumer-centric strategies. These companies define marketing broadly to include P&L delivery, and hence, marketers in these companies go on to key top management positions in the company. Given that marketing includes cross-functional business leadership, marketing in these companies tends to be the most sophisticated and analytically driven. These are the companies that acknowledge the value of brand building and consumer insights, and invest heavily in advertising and marketing research. It is the companies that treat marketing as the engine room that are the best training grounds for classical marketing fundamentals.


Ideally, you want to be pushing to the right-hand side of this continuum, if you are to truly drive long-term growth and value through marketing.