The fight marketers can’t afford to lose 

Opinion

Jonathan Knowles is right that capitalising marketing isn’t a silver bullet. But that doesn’t mean marketers should stop making the argument, writes Rob Beevers.

One of the very first things you learn in marketing is that how you describe something can matter just as much as what you’re selling.

Nespresso pods are expensive compared with a bag of ground coffee. They’re remarkably cheap compared with the flat white you buy every morning.

In 2025, AXA won the Cannes Grand Prix by adding three words to an insurance policy. Those three words, ‘and domestic violence’, extended an emergency relocation clause previously reserved for events such as fire and flood. The policy barely changed. What changed was what people believed it could do – it stopped being a financial product and became a way to help someone escape domestic abuse.

In 1958, David Ogilvy didn’t try to describe every aspect of the Rolls-Royce. He chose one observation that changed the way people understood the entire car: “At 60 miles an hour the loudest noise in this new Rolls-Royce comes from the electric clock.” One sentence told you almost everything you needed to know.

None of those products became objectively better overnight. They were simply understood differently. Marketing has spent the best part of a century showing that framing shapes perception, and perception shapes decisions, and decisions shape markets.

Which is why I find it so maddening that, when we start talking about marketing itself, we suddenly behave as though words no longer matter.

Good systems are rarely replaced because they stop working

Jonathan Knowles recently argued in Marketing Week that marketers should stop fighting to have marketing recognised as an investment because capitalising marketing expenditure isn’t the answer.

It is a thoughtful article, and in many respects I think he’s right. Under today’s accounting standards, blanket capitalisation might not be a simple fix. Financial accounting exists for good reasons, and forcing marketing onto the balance sheet simply because we wish it were there creates almost as many questions as it answers.

Where I disagree is the conclusion.

Good systems are rarely replaced because they stop working. They’re replaced because the world around them changes. Take the two-pin plug. The reason Britain went through the enormous effort of replacing it with the three-pin plug wasn’t that the old one had suddenly become useless. It was because someone had designed something better for the world we were living in. The transition was expensive, inconvenient and controversial, but looking back, it was obviously the right decision.

I don’t know whether marketing should ever be capitalised. I do know that dismissing the debate because today’s rules make it difficult feels like exactly the wrong instinct. The economy has changed dramatically over the past century. Many commentators argue that intangible assets now account for a significant proportion of the value created by modern businesses. It would be extraordinary if we never questioned whether the systems we use to describe businesses still encourage the decisions we want businesses to make. Even if the standards never change, marketers still have a responsibility to challenge the assumptions they create.

More importantly, I don’t believe the current language is neutral.

Month after month, every board pack, every set of management accounts and every budget review presents marketing in broadly the same way. It is classified alongside travel, utilities, and office supplies as an operating expense. That’s exactly what today’s accounting standards require, and for the purposes of financial reporting that may be entirely appropriate.

The problem starts when a reporting convention becomes a management philosophy. Accounting standards are primarily designed to record and report on economic activity consistently. They are not, on their own, intended to determine future investment priorities. Yet, over time, we’ve allowed one to become the other.

Marketers, of all people, should recognise the consequences. We’ve spent decades proving that the way something is described changes the decisions people make about it. It seems extraordinary that we stop believing that lesson the moment the subject becomes marketing itself.

Knowles rightly argues that cost is a poor proxy for value. On that point, I completely agree.

But I’m not convinced that’s the question capitalisation is trying to answer.

Nobody expects the carrying value of a factory, a warehouse or a software platform to equal its economic value. Accounting records cost. Markets value future cash flows. Those have always been different things.

Knowles’ argument demonstrates that cost isn’t the same as value. I am in complete agreement. I’m simply not convinced that proves marketing should always be treated as though its economic benefit lasts only a single accounting period.

Financial and media analyst Ian Whittaker argues that this debate matters because boards shouldn’t think of marketing simply as a growth driver. They should recognise it as something that reduces risk, improves the quality of future earnings and ultimately lowers the cost of capital. I think that’s an important step forward.

Where I’d push the argument further

One of the biggest mistakes marketers make is assuming CFOs think like accountants. The CFOs I’ve worked with are rarely buried in ledgers. They’re deciding where capital should be allocated, which risks are worth taking and what kind of business the organisation is trying to become. They think about strategy, resilience, talent, competitive advantage and the future shape of the business. They’re typically among the most strategic people in the organisation.

Which makes marketing’s behaviour all the more surprising.

We invest extraordinary amounts of time understanding consumers. We build segmentation models, map customer journeys and immerse ourselves in behavioural science. Yet when we walk into the boardroom, we often treat one of our most important audiences as though all they care about is this quarter’s ROI.

That’s a short-sighted view. 

The question is far more likely to be about where demand will be in five years’ time. Whether customers will continue paying a premium. Whether earnings become more resilient. Whether the business deserves a higher valuation than its competitors due to more predictable future cash flows.

Marketing can influence every one of those things. We simply spend far more time explaining marketing to marketers than we do to the people allocating capital.

I respect Knowles’ argument enormously. Articles like his make the discipline better because they force the rest of us to think more carefully. I just happen to think this is one fight marketers can’t afford to walk away from.

Marketing has spent the last hundred years teaching us that the way something is described changes the way people value it. Walking away from this debate would mean accepting that lesson applies to everything except marketing itself. 

Perhaps the answer isn’t capitalisation. Perhaps it’s better management accounting. Perhaps it’s a reporting framework that hasn’t been invented yet. I genuinely don’t know. What I do know is that marketers have never been in the business of accepting that the current description is the best one simply because it’s the current one.

After all, if I say:

• Should’ve gone to…
• I’m lovin’…
• Every little…
• Have a break…

…most people can finish the sentence without thinking. Better still, they can tell you the brand behind it.

Those words are commercial assets every bit as real as a factory or a patent, even if today’s accounting standards choose to describe them differently.

If marketers won’t market marketing, we can’t be surprised when nobody else does.

Rob Beevers is the chief marketing intelligence and transformation officer, MG OMD