Five Tips From a Personal Care Industry CEO for Setting (and Getting Approval for) Your Marketing Budget
When we ask marketers about their biggest challenges, budget issues are usually at or near the top. Ecommerce marketers say size of marketing budget is the biggest challenge to their companies’ ecommerce operations. B2B marketers say lack of resources in staffing, budgeting or time are the biggest barrier to overcoming their top challenges.
Everybody is challenged by the budget in some way.
So to give you a business leader’s perspective on key budget questions: What should you prioritize in your budget? How should you work with the rest of the organization? How do you get your key priorities approved?
I looked outside of the marketing-sphere and interviewed Stuart Benton, President and CEO, Bradford Soap.
Stuart has a unique perspective on budgeting, as he was formerly Bradford Soap’s CFO, and has a perspective on selling products as well from a previous stint as Director of Sales and Financial Operational Planning at Veryfine Products, a $250 million juice company (at the time).
To give you some context, Bradford Soaps is a 140-year-old, $100 million organization with 700 employees that develops and manufactures soap for Dove, Johnson & Johnson, L’Oreal, Tom’s of Maine, Dr. Bronner’s, and other brands.
“We make the majority of all the specialty bar soaps in America,” Stuart said.
Here are some tips from our conversation to keep in mind as you set your next budget…
Tip #1: Marketing should have a seat at the table for new product development
To be an effective marketer is to know the customer. And to be the internal advocate for customers’ needs. So it makes sense for Marketing to have a seat at the table when it comes to products.
In the case of Bradford Soap, New Product Development lives within the Marketing Organization (which, along with Sales and Research and Development, ultimately rolls up to Business Development).
“It’s kind of a hand-in-glove relationship where numerous ideas are generated and we can very quickly in the R&D lab figure out do they work? Do they make sense? Is this scalable? Is this something that can be done? So from an R&D perspective, we’re trying to deliver stuff that will sell,” Stuart said.
Key Question #1: Have you given your marketing team the time and resources to effectively inform product development? After all, you can throw money all day long at TV ads and SEO if you want. But, at the end of the day, if you don’t have a product that truly serves the customer, your success will be limited, no matter how much you spend on driving traffic to it.
Tip #2: Understand the CEO’s expectations of the marketing organization
In speaking with Stuart, his view of Marketing’s responsibilities fall in line with many other organizations. Ensuring the Bradford messaging is consistent. Responsibility for the website, newsletters, internal and external communications. And, of course, supporting the sales group and getting in front of new customers.
However, there are also certain elements that are likely unique to Bradford. For example, a supplier awards reception and a customer/supplier relations program.
“We’re partnered with a group called Design Rhode Island… so designers can understand what’s important, how to design or present ideas for designs on a soap box, on a soap wrapper. How do you get the information on such a small space? What are the technical requirements, such as ingredient list? And how that interacts with companies that have established designs and logos,” Stuart said.
Key Question #2: How does your CEO view Marketing’s responsibilities in your organization? Depending on the company, some organizations expect marketing to be responsible for sales presentations, customer service, social media monitoring, internal corporate communications, and even human resources recruiting. Are you on the same page with your business leaders? How will ensure your team has the resources and expertise to excel at these elements while still have time and budget to focus on core marketing functions?
Tip #3: Provide options
When setting and seeking approval for your budget, understand your business leaders’ objectives. What are their goals for the organization? And how can marketing tie into them?
To set your team up for success, instead of just presenting one rigid budget, it might make sense to give different options on how you can hit those goals – or which goals you can hit – based on the resources you are able to secure.
“Provide some options,” Stuart suggested. “In order to achieve these objectives in the prestige accounts, we’re going to need to do X, Y, and Z,’ and ‘For this amount of spend, this is what we can expect. And for this amount of spend, this is what we can expect.”
Key Question #3: How can you work flexibility into your budget? Can you present it in a way that incorporates business leaders into the decision-making process instead of providing a simple, binary yes/no decision? After all, there is more than one way to skin a cat. Or a website.
Tip #4: Tie into your company’s core values
Understanding the CEO’s business objectives is important, but understanding her (and the company’s) values is crucial, as well.
Stuart gave the example of deciding whether the company really needed to buy market research data.
“But if you look at our positioning statement, one of our core values and cultural behaviors is innovation, and we define innovation as new, better, or amazing. We also have a cultural behavior called passion and caring about it,” Stuart explained. “So we really need to be able to deliver on those and we need that data to do it.”
Key Question #4: Does your marketing budget seek to support and uphold your company’s positioning statement and value proposition? Understanding what your business leaders value (beyond the straight monetary goals) will help you plan for success. Plus, if your organization is spending time, money and energy to put a certain position out into the world, if the budget undermines it, you will lose customers (and employees) with that hypocrisy.
Tip #5: Drive innovation
In any marketing organization, there is a certain amount of “keeping the ship afloat” that is necessary. However, don’t overlook the need to continually drive innovation, or all of those maintenance activities will be for naught.
You need to drive innovation within the marketing organization, but also within the business (as an advocate for the customer) as well. For example, Bradford created the first natural soap at the request of Tom’s of Maine.
To stay ahead of the market, it also innovates before it has a customer to buy the product. For example, it was the first U.S. bar soap manufacturer to receive organic certification.
“We saw the market going in that direction and we saw some opportunities out there,” Stuart said.
Marketing is one of the organizations within the company that plays an important role in this innovation.
“We try to identify trends, and that can come through the marketing group, through their research. That can come through us walking trade shows and meeting with suppliers. It could come from people coming to us because they know that we’re innovative and we’re always looking for new ideas,” he said. “We don’t restrict the marketing group in what they need to research or what they can stumble upon.”
To systematize the process of innovation, a quarter of the supply chain organization, marketing organization, and research and development group get together for at least half a day, focus on a target topic, and bring in a couple of vendors to discuss something innovative or new.
“Breaking down the wall so that people don’t think that they have to be pinpoint focused. And that, per se, doesn’t take lots of budgeted dollars. What it takes is, I guess, creating a budget that allows people to do a varied amount of activities within their day-to-day responsibilities,” he said.
Using this process, Bradford is currently experimenting with making more environmentally friendly soap by using sea algae oil, as well as a soap that provides an SPF of 15 even after you wash it off (which came from a failed project years earlier).
Being innovative by begin first-to-market with organic soap manufacturing capabilities ultimately led to new clients for Bradford Soap. “It enabled us to bring in Dr. Bronner’s, which is one of the most recognized organic soaps in the nation,” Stuart said.
Key Question #5: Do you account for innovation in your budget, or only maintenance? Innovation may be as simple as making sure you have staffed sufficiently so your team has some time dedicated to explore. Or it could include budget necessary to attend industry events, conduct marketing experimentation, or get necessary market research.
Bonus Tip: Create a relationship of trust with the CFO
As I said in the beginning of this blog post, Stuart has a unique perspective on budgeting as a current CEO, and also a former CFO.
So, as a final question, I asked if he had any advice for marketers on budgeting from a CFO’s perspective.
“Be honest, be truthful, deliver on what you say you’re going to deliver with the money that you’re asking for and probably most importantly, create a relationship of trust,” Stuart concluded.
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Categories: Marketing B2B marketing, b2c marketing, marketing budget, marketing leadership, resources
