Measurement
and calculation for the value of non-advertising communications
efforts have become increasingly important to many clients
in our industry today. Nevertheless, it is more difficult than
ever to filter through the excessive amounts of marketing measurement
options, fads, and arbitrary methodologies. PHPR believes that
there are a few principal guidelines to follow that may enable
us to eliminate distractions and perform legitimate measurement.
This ability, we trust, will ultimately prove beneficial to
our clients.
Postscript
Editor’s Note: The following article
appeared on July 18, 2008 on MediaPost’s Online Metrics
Insider. We wanted to quote this in its entirety here,
as it has relevance in a number of areas. It is reprinted
with permission.
FIVE
IMMUTABLE LAWS OF MARKETING MEASUREMENT
by Pat Lapointe
It’s
gratifying to see the increasing popularity of marketing measurement.
You can barely get through an article on marketing these days
without seeing "ROI" or "metrics" in the
copy. Google search on "Marketing ROI," and you'll
get 16.5 million hits.
Unfortunately, in a world where anyone
can publish anything electronically and everything looks good
at first glance, marketing measurement solutions are being
tossed about rather casually. "ROI" has become shorthand
to describe any ambiguous effort to associate spend with economic
value. "Metrics" are anything you can build a bar
or pie chart on. And don't even get me started on "dashboards."
Measurement
isn't a fad; it's a cornerstone of success for marketers. Along
with brand-building, customer value creation, and product/service
innovation, comprehensively and objectively measuring the payback
on marketing investments, regardless of channel, is price-of-entry
for a CMO to earn a "seat at the table" with other
functions.
How then do you cut through the clutter of "surveys," "benchmarks," and
other "best practices" being reported by software
vendors, data purveyors, and consultants?
Here are a few common-sense
guidelines to apply to anything you may read or hear.
1.
The purpose of marketing measurement is to enable the
firm to take smarter risks to achieve growth and attain
competitive advantage. It is motivated by a desire to
be more aggressive, efficient and effective with the
marketing budget, not to "cover your ass." Check
your motivation before you launch and make sure you're
being honest about the desired outcome.
2. Everything can be measured. The questions are: how much time or money is required
to achieve a level of confidence in the outcome, and what is the value of higher
confidence? Don't accept data gaps or inter-dependency as an excuse for inability
to measure marketing's contribution to business outcomes. Some creative and cross-functional
thinking can convert the challenge into an opportunity.
3. Make judgment explicit. When objective data is lacking, we all make decisions
based on judgment, experience, and intuition. Most of that judgment is informed
judgment. Making our assumptions and judgments explicit allows us to share them
with others and benefit from being challenged, which in turn builds credibility
in the inevitably judgment-based aspects of the measurement plan. Don't let waiting
for hard data inhibit better decision-making.
4. Marketing is not an island within the company. Consequently, its measurement
cannot be isolationist. Engaging finance, sales, and business units in the marketing
measurement process is critical to learning and to credibility.
5. Availability bias is blinding. Looking only at the data you have (or that
which is easiest to collect) inevitably reinforces the current view of the world.
Altruistic attempts to use available elements will almost always distract constrained
resources from the path of progress. Effective measurement defines knowledge
requirements beyond the information at hand and relentlessly pursues closing
the gaps. |
So
the next time someone trumpets their survey of what 1000 "marketers
like you" are doing "to increase ROI," challenge
it with the same vigor you would a business plan requesting
your funding. Resist the temptation to believe that
the median scores of companies having little in common
with yours are
meaningful. And when someone trumpets talk about "best
practices," ask if anyone has experienced success
doing it any differently.
In the end, all we know for sure
is that
effective marketing measurement takes courage, sweat, and
persistence to break down organizational, political, and
cultural obstacles.
The insights you derive from it cannot easily be bought,
only earned. |
