Carolyn Hansen |
on January 23, 2009 |
category: direct marketing |
Vice President/Marketing
What's worth measuring.
Yet another survey of marketers has shown that they are unable or unwilling to measure marketing return on investment. This time the information comes from The Conference Board in a report called Managing and Measuring Return on Marketing Investment.
I don’t doubt that technical and other issues seriously inhibit measurement. But it doesn’t mean you can’t make a start. Here’s the kicker from this report:
Leadership commitment (63 percent) is the most important driver of marketing ROI. An additional 37 percent said that executive sponsorship in particular is an important driver, supporting findings that identify senior leadership as the most important component of the business environment for the advancement of an ROI-driven marketing effort.
If I’m understanding what this says and my math skills are up to par -- 63 plus 37 . . . carry the 1 -- 100% of the marketers surveyed who aren’t able to measure ROI think it’s because their boss won’t let them. I must be misreading this.
The real issue looks like something else. Another quote:
Although the inputs and expenses associated with marketing can easily be measured on a monthly or quarterly basis, the results of a successful marketing effort — enhanced brand recognition and reputation, customer loyalty, improved market penetration, expanded networks and cross-selling opportunities — may not be realized in the form of increased revenue within a specific timeframe and may be difficult to forecast,
Some of these things are either nearly impossible to measure or else really not important.
Brand recognition is not necessarily worth measuring. You should have an idea if your brand isn’t well known. If it isn’t well known generally, you may also have a pretty good idea if it’s known within your target market. When you talk to potential customers, have they heard of your company or product? If not, brand recognition may be an issue for you. Measuring it isn’t as important as fixing it -- because (as noted) it can’t really be attributed to a single effort anyway.
Reputation is rarely impacted by advertising. Perhaps this metric can be foisted on the PR people.
Customer loyalty can be measured, and relatively easily, if you have a customer database. If you don’t have one, you need to figure out whether it makes sense strategically to build one. If it doesn’t make sense, maybe all you need to measure is revenue growth.
Market penetration is something like brand recognition. It may not be an important metric. And wouldn’t revenue growth (again) be an easy substitute, until the time comes when you’re able to determine market penetration? If it’s that big a deal, can you hire a research firm? Outsourcing is a possibility for measuring many of these things.
Expanded networks. Umm . . . what does that mean in this context?
Cross-selling opportunities? If you have customers and you know who they are, e.g., have a database so you know what they bought or have a retail store so they’re standing in front of you when they’re buying, you have cross-selling opportunities. Since these are both one-to-one examples, you should probably be able to get some measurement in place. If your boss lets you.
So much depends on what you’re selling and how you sell it that my generalizations sound as fatuous as the results of this 73-person survey. So, seriously, before you rant and rave about how hard it is to measure results, remember that it’s okay to decide that some results aren’t worth measuring.
Comments:
2/3/2009 at 12:35 a.m.Thanks!Thanks for the suggestions, Dave.
We're having a meeting about how we can improve this blog on Monday . . . and I'm forwarding your comments to the rest of the team. (I make no promises about when you'll see changes, however!)
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2/2/2009 at 7:20 p.m.MeasurementsI like your blog, your team is obviously focused on creating great content. I have a couple of recommendations.
1.) Use Blog software that will allow a commenter a link back to his website. That will create more comments, which inturn creates better ranking and thereby more sales.
2.) Supply a trackback link so that if someone wants to talk up your great post on measurement they can give you credit. That will create more links, which creates better ranking, and you guessed it more sales.
Blogging is marketing and you guys have infrastructure and talent depth to rock at it.
Positively,
Dave Pavlu
Measurement Freak
http://www.AdsUpNow.com
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