Transforming Marketing From a Cost Center Into a Profit Center
The Challenge
The client is a leading value-added supplier of wireless communications products — network infrastructure, site support, fixed and mobile broadband, and mobile accessories — with a heritage running back to the earliest US cellular networks. But marketing was running as a cost center, returning negative $2 for every dollar invested. The opportunity was to do what distributors can do and rarely execute: sell value-added services and make money in the process.
The Approach
We built a marketing agency model inside the business — a full range of marketing services sold to the distributor’s own customers, designed to deliver incremental revenue and hit lead generation goals at the same time. That gave customers more options, better service, and a reason to consolidate spend, while turning the marketing function itself into a revenue line.
The Results
Return on marketing spend moved from negative $2 to a positive $7.50 for every dollar invested. Total revenue rose 27% year over year, with a 9 point improvement in margin — marketing operating as a profit center rather than an expense to be defended.
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