Scale-up businesses need a new way of thinking about effectiveness
There are reams of case studies, meta-analysis, books and tedious PowerPoint presentations on best practice in advertising effectiveness. But there’s a yawning gap in practical and academic advice when it comes to effectiveness insights for scale-up companies.
I spent my formative years in mature businesses such as Unilever, Birds Eye and The AA, and learned my effectiveness trade from the masters, including Les Binet and Peter Field and the Ehrenberg-Bass Institute, with some hand-holding from industry bodies like the IPA and Warc. But as chief marketing officer and now chief executive of Eve Sleep, I’m leading the marketing efforts of a young brand where every penny’s impact is immediately felt and it just doesn’t seem so simple any more.
Eve is a scale-up that is rapidly growing up. Scale-ups are not start-ups, but businesses in their growth phase, seeking to grow quickly. Our challenge at Eve is navigating the path to sustainable growth. If you’re a company looking at growth at all costs, your choices are relatively simple and you can “growth hack” to chase the dollar. At Eve, we’re on a path to profitability in a highly competitive, mature market and sustainable profitability.
Naively, I assumed that when it comes to advertising effectiveness, there would be little difference between large established businesses and scale-ups. But a growing scale-up is typically on a one- to three-year journey towards profitability and there’s no forgiving baseline brand equity upon which to rely.
At Eve, a huge amount of sales variance is driven by our advertising and wider marketing. That means if we get it a bit wrong, it goes very wrong, very quickly. But when we get it right, it goes very right. Exciting? Yep. But can I find any decent research, case studies or analysis of the effectiveness journey I need to follow? Nope. I joined the UK council of Effie Worldwide to help find a solution and drive the understanding of marketing effectiveness for scale-ups and fast-growth brands like Eve.
Case studies are so hard to come by in this brave new world of fast-growth ecommerce, because sustainable profitability hasn’t yet been widely achieved. The effectiveness conversation to date has relied on large-scale meta-analysis of IPA banks and long-term data – neither of which is directly relevant for scale-ups. Added to which, most scale-ups aren’t working with the sort of agencies that invest in unpicking effectiveness.
However, some agencies are starting to get a handle on scale-up communication effectiveness. Jonathan Trimble, founder and chief executive of And Rising, told me: “We’ve seen real success using a balanced scorecard. Pressure on last-click performance based on a single channel view is relaxed in favour of a focus on an overall channel mix, incorporating broadcast channels and ‘brand’ much earlier in the growth cycle.”
At a scale-up, effectiveness must be achieved over the short term and it has to generate a multiplier effect rather than a steady cumulative impact on business performance. That means brand investment has to work hard from day one.