Marketing Performance Measurement Toolkit
There are many definitions of marketing, in fact, too many. Along with the progression of the Internet and consequently the development of new marketing techniques, technologies, and gimmicks, new definitions of marketing are appearing in large numbers. However plural and diverse the definitions of marketing may be, their essence remains intact. Marketing is certainly still the unique function of the business enterprise and no thriving business is possible today without effective marketing.
Most companies believe that marketing effectiveness is expressed solely in numbers. Apparently, there are aspects (metrics) of marketing effectiveness that can be quantified and measured. The first and foremost goal of marketing is to create customers. Consequently, the effectiveness of this aspect of marketing can be gauged by the number of new customers, new potential customers for a company, or, in the case of telemarketing, the number of calls completed. Another important metric of effectiveness is the number of new products purchased by existing customers, since the goal of any company that intends to stay competitive in the market is not only to create new customers, but also to value and retain existing ones.
Measuring response is another simple and compelling way to evaluate marketing activities. By taking the total cost of a marketing activity (for example, an advertisement) and dividing it by the total number of responses, you determine the cost-per-response ratio. This cost-per-response ratio can help you decide if this activity was a success by comparing it to alternative marketing activities. A standard measure of the effectiveness of various marketing activities is the marketing ROI (return on investment).
Apart from the above, there are aspects of marketing effectiveness that cannot be quantified. Many marketing analysts say that the job of marketing is to establish an environment in which the customer appreciates the benefits of doing business with your company, to set the stage for making the sale, to create the circumstances that make the sale the next logical sale. and appropriate. passed. The uniqueness of a company that sets it apart from the competition, its strong dominance in the market, i.e., a company’s status as a recognized leader in the field, the ability to stay at the forefront of the customer’s mind, can all be considered the benchmarks for testing a company’s marketing success.
Marketing effectiveness that results in companies achieving their sales goals, better profits, and higher bottom line performance is determined by quantified and unquantified metrics. The concept of highlighting certain metrics when analyzing marketing policy efficiency and performance has been embraced by many and continues to evolve. Making marketing more responsible is an opportunity to test the effectiveness of your marketing performance. The development of modus operandi to measure marketing performance has become a hot topic in today’s marketing discussions. There are two stakeholders who are more interested than others in solving the problem. The first party represented by CEOs, CFOs and board directors want to know that marketing investment generates profit. Sellers that make the second part want to try the same.
The solution to the problem took the shape and form of a scorecard, no surprise. Thus, marketing is becoming the latest in the list of business functions to accept scorecards, a concise report presenting a set of measures that relate to a company’s performance, as a means of gauging activities. marketing in order to provide a global vision. of the performance of the aforementioned business department.
The next question that arises here is how many metrics and which ones in particular will make a scorecard complete and complete? Some economists claim that there are more than 50 marketing metrics; however, it is clear that not all are equally important. A scorecard that is capable of accurately diagnosing and predicting the future of marketing performance will include the fundamental metrics that assess only what is truly important.
Fundamental metrics should include not only quantified metrics that are easy to measure (for example, number of new customers, ROI) but also non-quantified (brand awareness, brand equity) as it is the latter that are mostly capable of measuring. to determine the long-term vitality of a company. Therefore, building a perfect scorecard that measures marketing performance needs some training. Surveys show that those that already exist may still need some refinement and updating.