Is Marketing a Luxury?

I’ve had some amazing conversations over the last few weeks, covering the whole range of the good, the bad, and the ugly. The one that sticks in my mind the most was with the CEO of a midsize software company, who told me “When times are tight, we can’t afford luxuries – and marketing is a luxury”. I was stunned. This CEO, who will go un-named to protect the guilty, went on to explain how he arrived at this conclusion. “I once worked for Oracle, and while there, Larry Ellison told me that there are only two kinds of people. Those who build products, and those who sell them”. As you might expect, I tried to present an opposing view – but I might as well have been talking to a statue. His mind was made up, and his marketing team was about to become a part of our country’s growing unemployment statistics.

I recognize that Larry Ellison is regarded in business circles as something of a deity, and as such people will take his words to be as meaningful as anything written in a religious text (pick your favorite). Like the deities of those texts, however, I tend to think that Mr. Ellison was to some degree speaking in parables. He didn’t say, “there are only two kinds of people – product developers and sales reps”. He said “people who build” and “people who sell”.

I’m pretty certain that if I go back and look at the annual reports of Oracle over the period of time that they’ve existed as a public company, I’ll never find a year in which the marketing expenses were zeroed out. Is that because Larry Ellison is accustomed to a life of luxury? Doubt it. More likely, he understands that selling doesn’t begin when the salesperson gets engaged – it begins when we start marketing. And the downstream job of the quota carrying salesperson becomes a lot harder without the “air cover” that marketing provides in establishing the reputation of the company and its products, enabling the sales teams with content, and engaging with buyers without pressure throughout the sales process.

So CEO’s beware – Eliminating, or drastically cutting marketing is effectively cutting off the wide end of your sales funnel, and making it harder for what’s left to flow through to revenue. Marketers are people who sell. Ignore that, and you’re likely to find yourself trying to feed thousands of people with 5 loaves and 2 fishes. Not even Larry Ellison can do that…

-Ted