A New Approach to Annual Planning is Needed
6 min read.
This article was originally published in the Agency issue of IMJ in October 2019.
I feel I should begin by offering season’s greetings to the marketing community. We often seem to operate on a different time scale; planning Christmas in summer and summer campaigns in January.
But Christmas isn’t the season I’m referring to. The seasonal greetings I wish to offer are for planning season; annual planning to be precise. Something we’ve learned many Marketing professionals approach with a sense of customary apprehension. So it seemed an apt time to offer an approach which may help alleviate some of the pain.
Long-Term Planning Cycles
One of the toughest challenges is often simply where to start. And that’s understandable. In-fact one of the barriers is the construct itself; annual planning. It implies something quite dangerous. That we should start again each year with new objectives and new ambitions. In a marketing landscape dominated by talk of effectiveness and long-term thinking, annual planning done in isolation can often contribute to the opposite. It promotes a short-term mindset with competing objectives as we try to achieve too many things in too short a time frame.
So what is long-term? It’s multi-year and means adopting multi-year planning cycles. These must start with the business plan; where does the business need to be in three to five years’ time. To succeed the right segments and objectives must be set. From there, annual plans become stages in that journey.
So the first step must be a backwards one. Step back and look at the bigger picture; the consumer, the trends, the culture and the future. Easily said perhaps but there are plenty of barriers to doing this, not least time and space. The day to day is more complex than ever, and seems to be growing more so, often faster than our resources.
That’s where a good strategic planning team can help. We act as an extension of our clients marketing team, relieving pressure by running and resourcing the process.
Marketing Strategy Business Case
The solution we offer is to build the marketing strategy as a multi-year investment case; demonstrating profit.
Increasingly we have been working with marketing teams to develop these cases. They are contributed to by and shared with Finance teams. They demonstrate sustainable growth and de-risk marketing investment for the business.
They focus on how targets can be achieved in the long-term through staged acquisition (and sometimes challenge if targets are realistic in the first instance). They demonstrate definitively how customers acquired in year one payback over subsequent years, and put a monetary value on brand equity.
Marketing initiatives are rarely profitable within a year. But they are over time. This is quantifiable and provable. Not in abstract cases, but in every business and brand in Ireland.
The brand strategy is vital to this. If growth is required, which segments will it come from? And how must the brand be positioned in order to appeal to that group? How long will it take to win them over? These must be addressed, but in the context of hard evidence, and hard numbers.
Marketing still has annual targets, and quarterly targets. But these are realistic steps in longer journey, and true Key Performance Indicators allowing for regular assessment and adjustments.
A New Beginning
Following Cannes International Festival of Creativity 2019, Peter Field released an update on his often-quoted stat; that creatively awarded campaigns were twelve times more effective than others. In 2016 that dropped to six. In his most recent study it’s down to four. The reason is a constantly increasing focus on the short-term. We are all aware of this trap, but we seem to be slipping further into it.
Field has persistently argued that creativity is a vital piece of a greater whole; long-term effectiveness. He stresses though that long-term means six months at a minimum, and that the strongest profit results are returned in years two and three. As Marketing professionals we must champion that long-term view. To do so we need to show the business specifically how it will deliver profit; how much and when.
I would once again like to wish you all best wishes for the season. Annual Planning, like Christmas is a time of reflection, but it can also be an opportunity to take a fresh approach. Time and resource can be a challenge, but one we can help overcome.
If these are challenges you find yourself facing, or something which might benefit you, please get in touch.