Great marketing has a direct payoff for investors. 

New research shows that companies with leading marketing teams deliver 79% higher returns to shareholders than their peers. 

Turns out top marketers aren’t a cost centre at all.

They’re driving significantly greater value for the business and its owners.

Marketing Excellence Drives Shareholder Value

Over the past five years, an index of companies excelling in marketing delivered about 23% annual shareholder return, far above the roughly 14% average of the S&P 500. 

In real terms, firms that are great at marketing beat the broader stock market. 

This highlights that marketing is a strategic investment that can pay substantial dividends to investors.

Why do top marketers drive such outsized results? 

A big part of the answer lies in what’s known as the ‘marketing value creation flywheel’.

This is a cycle of execution, brand building, and profit generation that reinforces itself. 

When marketing teams excel in all three areas together, the compounding effect leads to far greater growth than focusing on any single aspect alone. 

For example, companies that hit on all cylinders across execution, brand and profit outpaced others by that 79% margin in total shareholder value.

Here’s how each element of this flywheel contributes to success:

Execution Excellence

High-quality, high-impact campaigns delivered with precision and consistency. 

Reaching the right audience with the right message at the right time builds momentum for the business. 

Great execution, done repeatedly, starts the flywheel turning.

Strong Brand

Over time, consistent marketing execution fuels brand strength.

This is a valuable long-term asset. 

A stronger brand increases awareness and customer preference, boosts loyalty and trust, and even allows a company to command premium pricing. 

These benefits translate to real financial gains (not just vanity metrics) by driving sales and improving profit margins.

Profit Multiplier

When a brand, or brand marketing, is strong and campaigns are effective, each marketing pound delivers more back to the company. 

This marketing profit multiplier means higher gross profit for each pound spent on marketing. 

Those enhanced profits show up in the company’s financial results and, ultimately, in superior shareholder returns. 

Importantly, those higher earnings can be reinvested to further strengthen execution and brand.

AI as a Growth Catalyst

The advent of artificial intelligence is raising the stakes for marketing. 

Used narrowly, AI can certainly make marketing less expensive by automating content production, trimming budgets and enabling leaner teams. 

But used strategically, it can make marketing indispensable by unlocking new growth, higher profitability, and greater enterprise value.

Companies that leveraged AI as more than just a cost-cutting tool achieved over two times higher marketing-driven profitability than those using it purely for efficiency gains. 

This shows AI’s real power is in amplifying creativity, personalisation and precision. 

It helps marketers do more of what grows the business, rather than simply doing the same work with fewer resources.

For all its promise, AI isn’t a magic fix. 

The technology will amplify whatever foundation is already in place be it good or bad. 

Companies still need sound marketing strategy and execution.

AI just helps scale those strengths faster (or expose weaknesses sooner). 

The takeaway: treat AI as a tool to boost effective marketing, not a substitute for it.

From Cost Centre to Growth Engine: The CMO’s Long Game

Despite the clear link between marketing and shareholder value, many organisations still fall into the trap of short-term thinking. 

Marketing budgets are often among the first to face cuts when economic pressure mounts, as some CFOs see marketing as an expense to trim rather than an investment to nurture. 

To change this mindset, marketing leaders must actively reposition their function from a cost centre to a growth engine for the company.

Experts recommend that Chief Marketing Officers (CMOs) and their teams focus on a few key priorities to deliver higher returns:

Prove Marketing’s Value

Use data and evidence to clearly demonstrate how marketing activities drive revenue, profit and overall value creation for the business. 

Tying campaigns to sales uplifts or showing how brand equity contributes to pricing power helps build credibility.

Partner with the C-Suite

Build strong alliances with the CEO, CFO and other executives by showing how marketing supports the company’s growth strategy. 

Regular communication in the boardroom (using the evidence above) can build trust and alignment, so marketing is seen as central to achieving business goals rather than a discretionary spend.

Play the Long Game

Resist the temptation to slash marketing spend for a quick boost to quarterly margins. 

Instead, reinvest efficiency gains into long-term brand building, customer experience and innovation, ensuring you don’t miss marketing opportunities.

This ensures short-term cuts don’t undermine future growth.

Companies that consistently invest in marketing through economic cycles tend to emerge stronger and more profitable in the long run.

Key Takeaways

Marketing done right is a generator of growth. 

Businesses that empower their marketers to focus on creativity, brand strength and smart innovation will likely continue to deliver outsized returns for their shareholders. 

It creates a virtuous cycle: effective marketing boosts profits and shareholder value, which then funds further marketing innovation (like new AI capabilities), driving even greater growth. 

In this way, marketing becomes a self-reinforcing engine of enterprise value creation.

This benefits customers, companies and investors alike.

For more information, or help with your marketing needs, get in contact with Neon Atlas today.