How can marketing be turned into a profit center rather than a cost line? The short answer: stop treating it as a cost item and start managing it as an investment in P&L.
Marketing has long known how to count money, but does not always count it correctly. The digital environment has given marketers a huge volume of data and the temptation to believe that measurement transparency is now guaranteed. In practice, incorrect attribution, "fraud" metrics, and wrongly chosen conversion events create the illusion of growth in places where budget is simply wasted.
Below is how to genuinely tie marketing to P&L, and why this requires a different mindset from the entire team. This piece was originally published in Russian on Sostav.
How marketing came to be treated as a cost
In the offline economy, establishing a direct link between advertising and revenue was almost impossible. Measurement tools existed, but the margin of error was too high to treat marketing as a manageable investment. Individual companies achieved precise sales attribution — for instance, through local campaigns with trackable response — but overall, marketing operated as a supporting function: it influenced demand but was not tightly wired into financial performance. Its value was acknowledged at the level of common sense, not numbers.
That is exactly where the habit of perceiving marketing as a cost line item to be controlled, rather than an investment to be managed, came from. This distinction may seem formal, but it fundamentally changes the logic of decision-making.
With the rise of digital, tools appeared that made it possible to track user behaviour in real time: clicks, views, conversions, screen paths, drop-off points. Marketing began transforming from an intuitive practice into a measurable discipline. But with that came another trap.
More data, not more clarity
Many people concluded: if everything is digital, then everything is transparent. It is not. Quantity of data and quality of data are fundamentally different things.
Problems generally arise not from a lack of information, but from its quality. Attribution is set up incorrectly, the target conversion is wrongly defined, ad networks claim traffic that is not theirs, different teams define "new user" differently, organic and paid traffic get mixed together. If the data is collected superficially or not properly connected, any conclusions drawn from it will be wrong — no matter how many numbers appear in the report.
There is a lot of data — but the quality of the measurement system does not match its volume.¹
That is why the CMO–CDO (Chief Data Officer) partnership matters more than is commonly assumed. If marketing is becoming a mathematical discipline, the question is no longer "can we count?" but how the data collection and processing system is designed. The CDO provides marketing with what strong decisions cannot exist without: high-quality data and correct measurement logic. The CMO, in turn, cannot simply receive numbers at the output — they need to understand where the data comes from, how much it can be trusted, and how to interpret it correctly.
Bad measurement is more dangerous than none
A company can look exemplary: making fast decisions, leaning on numbers, optimising the funnel, driving CAC down. But if the data is collected and interpreted incorrectly, all of this only imitates effectiveness.
Often you see that reports show acquisition cost decreasing, but in fact the company has not found more effective sources of growth — it is simply paying for users who would have come anyway.² Budget goes into "buying its own organic". Formally the report looks great, and money is being wasted.
In other cases the team focuses on lowering cost per conversion and optimises campaigns for the cheapest results, without tracking retention. Ultimately, more and more users are acquired who leave immediately and do not return. These are called "one-day users".
In professional terms these are fraud metrics (pseudo-metrics): the metric is formally satisfied, but the real result is absent. Because of them, a company can spend a long time moving not toward growth but toward resource loss without realising it.
How to technically connect marketing to P&L
Any attempt to link marketing to financial results begins not simply with data, but with its architecture. This comes down to three concrete questions:
- How exactly is a new user counted, and does the team share a single definition?
- How is attribution configured, and does it re-attribute organic traffic?
- How are cohorts formed, and how is payback calculated?
An error in any of these can distort the whole picture.
The next level is modelling. It is not enough to analyse past results — you have to understand how changes in marketing will affect the future. Two metrics without which the CMO's dashboard is incomplete:
ROMI shows return on investment, not simply cost of acquisition. ROMI accounts for all costs — agency, production, technology — not just direct media spend. That is exactly why it gives a more honest picture of payback.
According to McKinsey's 2025 study of 500 marketing directors, measuring ROI entered the top-6 priorities, and 72% of CMOs plan to increase budgets provided they can convincingly explain their return.³
Incrementality — how much additional revenue marketing actually created, rather than re-attributed from organic.
An illustrative example is Uber. The team discovered that new-registration patterns matched seasonality exactly, regardless of the volume of ad spend. Paid advertising was not generating new demand — it was simply "capturing" users who would have come on their own. Ultimately the company reallocated $135 million from ineffective channels into real growth.⁴
What if marketing did not exist at all
The most honest way to check whether marketing brings in money is to imagine that it does not exist at all. Not cutting the budget — switching it off entirely. The answer depends on the size of the company.
A large brand will not feel anything for a while. Accumulated brand recognition works as inertia — but only until a competitor with active marketing takes over the top of mind: the first brand the consumer remembers in the category.
A small company has it harder. Without marketing, there is nowhere to get customers except word-of-mouth and those who were already searching for the product. That is a ceiling beyond which no growth exists.
Switching off marketing hits several fronts at once: top of mind is lost, loyalty dilutes, inquiries fall. The exception is companies with multiple verticals, where a loss in one direction can be compensated for by another for a time.
The Ehrenberg-Bass Institute tracked sales of 70 brands over 20 years and recorded 57 cases of complete advertising shutdowns lasting a year or more. On average, sales fell 16% in the first year, 25% in the second, and 36% in the third. Small brands lost sales immediately; large ones held on for one or two years thanks to accumulated reputation, and then also went into decline.⁵
A vivid example is the behaviour of two giants at the start of the 2020 pandemic, analysed by Mark Ritson. Procter & Gamble increased spending when the crisis hit; Coca-Cola sharply cut advertising. The results were markedly different: P&G's revenue grew, Coca-Cola's fell. Two comparable businesses in identical conditions produced opposite outcomes — and the difference was whether they continued to invest in marketing.
The takeaway from these cases: marketing brings in money not only at the moment of a click but over a longer horizon, which is exactly why it is so easy to underestimate. The damage from switching it off does not appear immediately — but it does appear.
The kind of CMO required now
The role of CMO varies significantly across companies. In some places it is still an executor who launches campaigns to a brief: "deliver reach", "increase awareness". In more mature companies the CMO is a business partner who participates in product development, influences pricing, and looks for new growth vectors.
The gap between these two models is gradually closing. According to the Gartner CMO Spend Survey 2025, 61% of companies now view marketing as a profit center rather than a cost center; in 2024 the share was 53%.⁶ Behind this increase is a shift in how businesses themselves relate to the marketing budget.
The new-formation CMO thinks like a portfolio manager: they do not fixate on how much has been spent on a given channel, but treat the budget as investments in revenue. That means they have to evaluate return, manage risk, and reallocate resources between instruments based on real payback.
At the same time, marketing should not turn into pure analytics. A reliable information environment, paradoxical as it sounds, gives freedom for bold decisions: when the team understands what and how is being measured, they are less afraid to take risks. Strong creative can significantly influence ROMI — and this is part of the managerial logic that is often forgotten. The entire team should clearly understand how marketing affects profit, see which actions lead to real business outcomes rather than merely improving metrics, and be able to calculate payback not for an individual channel but for the whole marketing mix.
Sources: ¹ Firework, State of Video Commerce Report (2025) · ² Harvard Business Review, "The Attribution Problem" (2024) · ³ McKinsey & Company, Global CMO Study (2025), 500 respondents · ⁴ Uber, "How to Waste $135 Million on Advertising", Kevin Frisch presentation · ⁵ Ehrenberg-Bass Institute for Marketing Science, "When Brands Go Dark" — 20 years of data on 70 brands · ⁶ Gartner CMO Spend Survey, 2025