Measuring marketing’s worth.
MAY 2012 • David Court, Jonathan Gordon, and Jesko Perrey
Source: Marketing & Sales Practice
I strongly recommend you read the full summary!!
You can’t spend wisely unless you understand marketing’s full impact. Here are five questions executives should ask to help maximize the bang for their bucks
1. What exactly influences our consumers today?
The digital revolution and the explosion of social media have profoundly changed what influences consumers as they undertake their purchasing decision journey.2 When considering products, they read online reviews and compare prices.
2. How well informed (really) is our marketing judgment?
Marketing has always combined facts and judgment: after all, there’s no analytic approach that can single-handedly tell you when you have a great piece of creative work. A decade ago, when traditional advertising was all that mattered, most senior marketers justifiably had great confidence in their judgment on spending and messaging. Today, many privately confess to being less certain
3. How are we managing financial risk in our marketing plans?
Successful communication requires hitting the right audience with the right message at the right time: a small, moving target. With traditional media, marketers have mitigated the risk of failure through years of trial and error about what makes great advertising. That’s not the case with today’s new media.
4. How are we coping with added complexity in the marketing organization?
As the external marketing environment becomes more complex, so must the internal environment. Marketers historically had only a handful of communication vehicles; now they have dozens of them, and the number is growing rapidly.
5. What metrics should we track given our (imperfect) options?
In an ideal world, the financial returns and the ability of all forms of communication to influence consumers would be precisely calculated, and deciding the marketing mix would be simple. In reality, there are multiple, and usually imperfect, ways to measure most established forms of marketing. Nothing approaches a definitive metric for social media and other emerging communication channels, and no single metric can evaluate the effectiveness of all spending.