Marketers wasting company money

Global - Almost two-thirds (65%) of all marketing spend in 2007 had no effect on consumers, according to The Fournaise Marketing Group's 2007 Global Marketing Effectiveness Report.

The report, which aims to provide a timely insight for marketers to take a harder look at how their marketing dollars are performing, surveyed 3,000 marketers on a number of aspects of their role. According to the study, estimated wastage rates varied from 45% for business-to-business marketers through to 65% for business-to-consumer, with figures highest in low GDP growth markets such as the UK, US and Australia compared to high GDP growth markets like India, Greater China and Singapore.

"With the markets still jittery from the scares of a global recession, businesses will look at budgets with greater scrutiny to protect shareholders' value. The tendency is to cut back spending in areas where ROI can't be precisely quantified. Marketing budgets are typically viewed as an intangible investment, and therefore become one of the first to be axed. The problem is that while marketers are beginning to take heed and measure the effectiveness of their marketing spend in order to demonstrate the true value marketing brings to the bottom line, our report shows that 70% of Asian marketers are still not tracking the effectiveness of their spending at all," Jerome Fontaine, CEO and chief tracker for The Fournaise Marketing Group, said in a statement.

Fontaine said media clutter, sophisticated consumers and intense competition go some way to explain the wastage but tracking every marketing dollar spent would mitigate the effect and feed critical real time analysis back into marketing strategies, which in turn would have more positive impacts on businesses' bottom line.