Moving Marketing from Outputs to Outcomes

Mayur Gupta speaks to the idea that regardless of inputs and outputs, the outcome is what matters. He’s not just paying lip-service to a personal belief either. He’s used and evolved this approach to build and grow brands including Kimberly-Clark, Spotify, and most recently as the CMO for Freshly.

“Every moment is a brand moment and every moment is a growth & revenue opportunity. Brand is performance and performance is brand.”

The conversation that follows explores his experience and belief in a fundamental repositioning of the role and objective of marketing. Executives and early-stage founders will want to take notice of how they can shift their own structures and truly align objectives to reduce fragmentation and create actual long-term business impact.

TBD: In a recent post, you stated, “consumers don’t differentiate or understand brand vs. performance. They understand value and relevance.” How does this reflect your approach to marketing in both how it should be valued and measured?

MG: That’s the great dilemma that we are all in. At a macro level, every single brand, every single marketer or product, are all consumer-focused. But in reality, when we walk into the office every single day trying to build products and ideas and experiences, more often than not, we’re always inside out. We think we know what the consumers want, but we aren’t necessarily listening.

We all tend to think in the way traditional models are structured. In those functions between marketing and products and within marketing, between brand and performance. While the entire industry and the ecosystem would love to believe that the consumer is at the center, more often than not, it’s the channels that are usually at the center. If you think about how you allocate budgets, how you execute, it’s all pretty much around channels. It’s very much around the segments and silos that we put within an organization. And when you do that, you are creating a fundamental problem.

The fraction that exists as a result, which is creating friction within the consumer experience, has to be solved first in the company mindset. In order for us to deliver those frictionless experiences for the consumer, which is what they are looking for, you have to break down those silos in your operating model. I strongly believe that the experiences you deliver to the customers are fundamentally a reflection of how you organize and how you operate. Bring people together to deliver a certain type of experience or a part of that experience. It doesn’t matter if you’re an engineer versus a product person or a media team versus a brand team. In the end, you’re connected toward a customer experience to inspire a certain behavior. And you measure that. You rinse and repeat and optimize it. The rest is mechanical.

TBD: How would you describe the fragmentation in marketing as a function that you’ve seen through an engineer’s perspective?

MG: It took me many years to realize that engineering isn’t academia. It’s a mindset. One where you take a complex problem, break it into pieces, and stick it all together again. I strongly believe this idea is relevant in the world of marketing now because marketing has become far too complex. We, as marketers, tend to make it more complicated for two simple reasons. The first, consumer expectations, demands, and behaviors continue to rise every single day. This is because consumers have so much choice – meaning power and control – thanks to the tech we have at our fingertips. The disruption today is the consumer and we are all in response to that disruption.

The second is the marketing ecosystem and how quickly it’s evolved into multiple touchpoints. The proliferation of those touchpoints, channels, and content has made marketing very interesting, but also hard, or harder than it used to be. The way I think about the world of marketing from that standpoint is breaking it apart into three macro eras of marketing.

Very quickly, the first is referred to as the era of the madmen or sometimes the Dark Age of Marketing – from the 1970s to 2000. The tone of marketing wasn’t very promising because back then there weren’t many media tools to measure the incrementality of marketing. What worked in marketing was a bunch of media spends and great creative ideas. The consumer saw it. They had no options or “choice” other than buying your product. But, it was very hard to measure and attribute the impact, and marketing became a cost center.

Then came a new era between 2000 to 2010. I call this the Age of Digital Confusion. Marketing and ad tech made data table stakes. Now you could measure, but for a lot of us, tech almost became a hammer and everything looked like a nail. It took me many years to realize that this wasn’t digital marketing. Rather, it was marketing in the digital world to a consumer that was now inherently living a digital life. Around 2007, along with Facebook and the iPhone, came too much VC money. Innovation became very cheap, fast, and good for the world. But it also brought the growth-at-all-costs mindset creating hysteria around growth online. This made marketing absolutely binary. It didn’t matter what it told you. All that mattered was you clicked on the damn thing and you came into the buying ecosystem. A soul-less, fear-based, direct-response marketing ecosystem. Over the years, in parallel, the social platforms that gave us access to consumers in this way also continued to evolve to incentivize this kind of behavior.

And that’s where we are now. Marketing is in this confusing state where it’s all about the short-term impact. Validating a $100 ad spend in the morning by what was tracked at the end of the day. It is less about why the product or brand exists. It’s less about the purpose.

That’s where the unfortunate global crisis is actually a great shock for the function of marketing. This is all marketers’ chance to take us back to the equilibrium between purpose and growth where it’s no longer an either-or. Today’s consumer is extremely aware, extremely conscientious, and cares more about why you exist, and why you create the product and relatively less about how and what they’re buying.

TBD: How have you transformed internal structures to achieve this new focus on measurable marketing outcomes and how does the reality compare/contrast to your ideal construct?

MG: This isn’t just about marketing. It’s also for products. We used to call it a product’s valley of death where all you cared about is the next feature. That brings some excitement and then it dies down. And what do you do to address it? You launch another feature.

I think that marketing for many years has been also focused too much on the concept of campaigns, which I call the outputs. More often than not, I see people and brands celebrate the launch of a campaign, but very rarely see people celebrate the impact of campaigns. Why did you come up with that idea? What did it do? How did you beat the idea or expectations or outcomes you intended?

I think we are now at a point where the function of marketing has so much responsibility and accountability, that the focus on output is no longer sustainable. As a marketer or CMO, if that’s where the focus is, it’s going to be very, very hard to own the right to be at the table. Every CEO, every board, every management team is holding marketing staff accountable for impact. That impact is not just social impact or getting you closer to the purpose and the consumer. It’s that and at the same time impact to the business. Because with no purpose it’s a short-lived business, no question. With no business model, it’s even shorter. Fundamentally, it’s not either-or, and just focusing on the shiny object is no longer enough for marketing. It has to become a measurable and tangible growth engine.

When I’m talking to peers, colleagues, and thought leaders we all struggle with the question of how to balance that on the brand. With the pressure of VC money and shareholders, everyone wants to move the needle. So how do you bring the purpose? How do you ensure that when you’re running behind your quarterly goals and the monkey is on your back before your earnings call, that the hundred dollar ad spend balances somehow to what you truly believe in?

First of all, there is no single answer. Secondly, the one way that you can try to do it is to make 75% to 80% of your marketing absolutely efficient and attributable. Then do everything you can to use that 80% spend to get to 100% of your business goals. When that happens, you now have that 20% left that can be invested in that serendipitous, irrational marketing that builds a cultural and emotional connection. Because if you only spend and focus on the functional values with your consumer, you are continuing to be the most dispensable product. You’re just waiting for somebody else with new VC money to come in and either give more value for the same price or the same value for a lower price and you’ll be out of business.

TBD: Shifting from output to outcome is much more than semantics. As you’ve adjusted the physical scope of marketing functions to serve measurable outcomes, what are some of the biggest struggles/failures you’ve experienced with both internal and external team structure, communication, and output?

MG: Marketing has long had this mindset that because we are creative people we don’t like to be measured. We don’t like to test because we believe in our gut, not data. Which is absolutely right, but at the same time, the world’s changed.

You have to be able to quantify belief and measure the impact of what you do. That’s not only for the direct response, immediately addressable market, but it is also equally important for the less addressable, top-of-funnel brand marketing. The more mid- to longer-term. There are ways now that you can measure and attribute that. For me, this simply means knowing the answer to what amount of growth your business wouldn’t have had in the absence of marketing. There are so many different ways to bring attributability to measure and prove the true incrementality of marketing.

I think at a tactical level it’s applying that mindset to what you do every day. As a marketer, you now start operating like a GM or product person, which means you don’t run marketing as a cost center or shared service. Run it like a business where at the end of each month or even each week, you and your team pretty much know what’s been invested across brand, purpose, acquisition, growth, and retention. You know what you got back. Then at the end of the month, you don’t need a finance function to come and tell you this is what your team did and how much you spent.

TBD: What are the most relevant macro metrics of success and what are some tactical examples of how a business can implement ways to measure them?

MG: The fundamental thing that you still have to solve is how do you encapsulate this complex role of marketing into a set of KPIs that matters. The way I think about it is to break this into three always-on flywheels of growth of the brand, growth of the user base, and growth of the user value, which are constantly running and helping each other. It’s not an either-or if you’ve reached the scale state of product-market fit. You need all three of those flywheels to run together. The KPIs and outcomes are a double click underneath that. How are you growing the brand? How do you measure the value of your brand? How do you measure the incrementality of the brand? As an example, I would want to invest in the so-called brand ideas or content that really creates an emotional connection. I would measure that in the context of my acquisition and retention.

Think of it like this: If I’m investing in the top-of-funnel, then somewhere downstream I should be able to prove I’ve built a stronger brand by standing up for its purpose and that emotional connection with the user base is adding efficiency in my performance marketing. This means my CAC should come down, which means I should now have a lower dependency on discount. That’s a very tangible way of proving the impact and incrementality of the growth of the brand.

If your audience understands your true value proposition and the why behind what you do, you have a higher likelihood of having higher rates of retention and engagement, higher LTV. Your users are going to be more forgiving because they know what you do. They know who you are, and they know that you are being honest, transparent, and brave. When you say that you are obsessed with the value that they get as consumers, you mean it. That’s just one example, but don’t measure the impact of that investment in isolation. The context of the business acquisition, retention, top-line growth, and so on matter as much as the movement on the brand.

You can do the same thing with the growth of the user base, which is acquisition. Not only thinking about the volume of people and customers you acquired, but the quality of that acquisition, and how long it’s taking. What is your corresponding retention? How many of the users are actually becoming advocates for the brand? And so on.

So that’s the framework that I like to use because it helps me make sure that I’m not becoming too bottom-up. Oftentimes, marketers tend to measure proxy KPIs. How many people came to the site or what is my CAC? I think those are vanity KPIs and not foundational because it doesn’t matter how many people came to the site if they didn’t do anything, right? It doesn’t matter what my CAC is if my retention rate is terrible.

TBD: With so many designed to deliver on the traditional model of channel-specific outputs, where and how do external partners fit in and provide value? What do you turn to them for – ideation, production, or merely an objective point-of-view?

MG: Well, it definitely depends. No question about that. It is contextual with the biggest variable being your business model. What is core to you and what is nice to have? Where do you want to have full control versus where do you need scale? Where is repeatability? Or, what kind of resources do you want to have internally to leverage 50 hours a week, 52 weeks a year?

Regardless of which part stays in and which part stays out, the mindset fundamentally has to evolve to hold your partner accountable for impact, period. This impact or outcome is the same thing that you want to hold your internal teams accountable for. I think the shift that needs to happen – and I’m starting to see it – is the business model for partnerships. I feel the entire agency model is extremely broken and is actually in the process of being shaken up. The current model is constructed around doing stuff and not around creating impact or measuring impact and sharing the benefits. I think as somebody sitting on the other side of the fence, that is what excites me.

If I have a partner who’s saying, “Look, I’m going to take a share of the pie, but hold me accountable for the impact or the outcome. I understand where you want to take the business and I understand the consumer needs.” It doesn’t matter how we get there. Of course, it’s important that you are being authentic in what you do, but the definition of success needs to be consistent.

Think of it like this: Success for me internally cannot be moving the needle and delivering a great customer experience when success for my partner is buying the right piece of media. That’s disconnected because the media is only a means to a broader end. I want both of us to align on and be held accountable for a shared core objective and outcome.

TBD: What are the steps you believe a company can take to create true top-down alignment of the paramount internal functions of growing a business? For example, the CEO responsible for shareholder returns, the CFO responsible for margins, the CMO responsible for demand growth, and so on.

MG: I think the way you get them aligned is to not break down those objectives by function. Rather, you create a shared set of objectives and outcomes.

Let’s look at that exact example with you as the CFO responsible for gross margins and me as the CMO responsible for top-line growth. This is where the disconnect happens. Those are polar opposites. Not because of anybody’s fault, but because the definition of success for you is so different from the definition of success for me. This is true of finance versus marketing versus product.

So, one way to solve that, and it’s hard, starts with the definition of success objectives becoming consistent even if they still take different paths to get there. That, to me, is fundamental. It starts from the top and goes all the way to the bottom. Otherwise, even something as simple as a funnel from the first impression to your purchase and post-purchase can fragment. Where different teams are trying to drive different outcomes. It all stems from what you determined as an organization within the C-suite. How you define those commonly aligned and agreed upon success criteria and definitions and outcomes.

TBD: How can early-stage companies build structures and processes designed for an outcome-based approach at the beginning? Furthermore, how could they scale them as the organization grows in both size and complexity?

MG: Yeah, that’s a fun one. Everything I said now gets tailored based on the stage of where you are. And so the challenge then is there is no silver bullet or single blueprint upgrade. It all depends. The few things that I’ve realized working in the early stages begins with focusing on the three flywheels I mentioned earlier. At the same time, you make choices.

Day one, your brand is not necessarily the content you’re putting out there, but rather your product. The users that you’re acquiring are your brand. Your employees are your brand. Pretty much from your zero-to-one stage, you just focus on that because your goal is to know your niche audience or user base. With your limited budget and resources, you focus on what you have to do to bring them in and continue to iterate and optimize the product experience and prove that users return X number of times. Once you can identify that you have a great product in a great market, you find that you have product/market fit.

But when you reach the time to scale as a startup, that’s the point where you now have to shift gears. You may have already captured all the demand that was sitting on the table because that was easy. Now, you’ve got a million users and in order for you to get to 100 million users, you now have to leverage the power of your brand. You have to create scale, awareness, and reach to manufacture new demand.

This is where the growth levers have to be put in context to where exactly you are in your growth curve. The same thing applies in terms of process and speed. In your early stage, if you become too structured and too process-focused, you’re going to slow yourself down. You just need to know there are pivotal points that come in your growth. Where you have to evolve from being absolutely unstructured, focused on speed and autonomy, to reaching a point of scale that requires creating some cadence around the chaos.

It’s that tug of war, between speed and structure. Between growth and purpose. You just have to keep evolving, shifting, and balancing as you grow from the early stage to product/market fit to scale.

TBD: Building in size means building in complexity. How would you maintain what makes the company great when it’s small as it scales? What is the structure that keeps those teams focused on the same things?

MG: It’s hard to pinpoint any one thing, but something that stands out ultimately is your values or belief system as an organization. It leads to the kind of culture that you establish. Which should constantly be evolving by the way because as you bring in diverse people and backgrounds, your culture is meant to evolve. It’s not meant to be static. However, your values stay with you.

This is so important for any organization in the early stage to not overlook. Don’t think about it as the fluff part. I recently shared that all those things over the last 15 years we’ve been calling “the fluff part of leadership” have now come around and proven itself to be the substance.

I think that single-handedly is going to be the one thing that stands out for me regardless of what stage you’re in because I feel your culture and your values can eat your strategy for breakfast, lunch, and dinner. It doesn’t matter how great you are or how brilliant the product is if your culture and values are broken. If they don’t end up creating a safe and trusted environment, you won’t excel.

TBD: Admittedly, you didn’t begin your career as a marketer and have since had to grow into one. A lot of mid-size companies are similarly guided by something-turned-marketers – individuals that came up in sales, business development, or project managers growing into the position as the company grew. For those interested in shifting to this outcome-based approach, what would you suggest they do first?

MG: What I would say is that the modern executive or employee, unrestricted to marketing, now has to become multifaceted. They no longer can be a T-shaped executive or person. While you will always have your roots in something very specific because that’s how academia is structured, you now have to have an appreciation, understanding, and reasonable depth in multiple and different facets. That’s the nature of the experiences you drive, right?

As a marketer, you need to understand finance. You’ve got to understand data and tech. Of course, you have to understand storytelling because that’s a key component. As a product person, you have to understand marketing. You have to understand what drives consumer behavior. You have to understand the science.

I think, fundamentally, the world no longer needs isolated functions or isolated thinking. Don’t get me wrong, that doesn’t mean that everyone’s a generalist. Absolutely not. It’s still a combination of specialists who go really deep, but then also the orchestrators of the symphony. You can’t create great music with 100 people brilliantly playing their instruments, but with nothing connecting them.

What comes first is really contextual. It’s the same way in marketing, especially. More often than not, great marketers have had some experience on both the agency side and the brand side. They appreciate and understand the complexities on either side because of it. They learn differently. They build different muscles and a unique model of thinking.

Wrapping up our time with him, we asked what was planned for life after Freshly. Although he’s taking some time off, he said one thing’s for certain, what’s next “will have purpose and a mission.”

Mayur has published numerous articles and is often invited to speak on the topic of marketing. For those interested in diving deeper, we’d suggest starting here and following his daily insights shared on LinkedIn.

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