How to measure the results of your marketing

Measuring and tracking results effectively requires a multi-level approach


In dismay, the business owner said, “We do a lot of marketing, but we don't know if it works. I just know that we spend a lot of money."

His comment got a lot of reaction from the other business owners – most in agreement.

This is not a new challenge. In fact, it’s one reason why marketing is sometimes seen as less of a contributor to a business’ growth and development than it should be. Very few people know how to measure or understand its effectiveness.

So what can you do to more effectively track and measure your marketing? Here’s a slightly expanded version of my answer to the business owner….

Realistic expectations come first

The absolute first key to determining whether or not your marketing is working is to develop good, clear expectations for it – based on what marketing can actually accomplish.

For instance, marketing done well can build awareness about companies, products, and services. Marketing can separate one company or product from another through branding, positioning, and differentiation. Marketing can make you more competitive, more visible, and more present in the marketplace. Marketing can simplify and explain complicated things so people can understand them. Marketing can also activate people to do something – inquire, respond, go somewhere, try something, and even buy. And it can initiate, encourage, build, and maintain relationships – with customers, shareholders, and many other people you depend on. And that’s just to start.

The point is that Marketing can do a lot, but most business people have a deep-seated hope that it should really do just one thing – make the phone ring again and again with well-to-do, anxious-to-spend consumers.

You may laugh at that, but deep down, when I can get people to come clean, that’s what they want.

In fact, there are situations where Marketing can do that. But more often, it is the last of many steps along a carefully orchestrated marketing path.

Unfortunately, the two most-often tracked pieces of information (if any) we see are: how much did we sell, and how many new customers did we get?

Gather information on several levels

Effectively measuring and tracking Marketing requires approaching it from several different viewpoints – and on several different levels.

The first step is to identify the major tiers within the business – and exactly what each tier wants or needs to know. Let’s begin with these questions:

What is it that top management wants to know? In most cases, top leaders want to know about progress toward top line revenue growth, performance against goals and budgets, and profitability. While they are sometimes interested in particular elements of Marketing, more often their concerns are (or should be) big picture issues. The savviest leaders will often be concerned about awareness, preference, competitiveness, and trends.

Department or mid-level management may have other information they want to see. Some of the information will often overlap with what top management wanted, but other parts may be unique.

For instance, managers are likely to be interested in traffic (responses of various types), transaction size, and timing. How many have responded? How much are they spending? Are they buying what we anticipated or other things? Are these numbers moving up or down and how do they compare to last year? Are there common characteristics to these buyers we should know about and track? How long does it take from the time of mailing is dropped at the post office until the phone starts to ring or people began to walk in the door?

Some of the metrics that mid-level managers will be most interested in are quantitative and easy to capture. Other information may be more qualitative, subjective, and more of a challenge to obtain. For instance, marketing managers may want customer feedback and comments about new products. They may also be looking for complaints and other information that might point to problems in one of their processes.

Having this level of information can directly trigger another level of response to a first-time purchase. Suppose I buy a blazer out of your general clothing catalog. Will I be added to the database and not hear from you until the next time you send a schedule mailing – or will you send me a special catalog of men’s clothing with an incentive to buy something more soon? Will I be treated as a valuable new customer with potential or as just another customer? I call this response-activated marketing – where something is done in response to some earlier activity. This is the kind of Marketing thinking that separates great marketers from ho-hum marketers.

The third area where marketing metrics are important is often at ground level – meaning the level at which your people must actually deliver the service. Let's use the case of the catalog marketer again. The folks taking the calls need to know the likely timeframe from the day the catalog arrives at the post office until the catalog arrives in people's homes – because the arrival date is when the phones will start to ring – not before.

Once the phone starts to ring, they also need to know how long and at what level of intensity it will continue and eventually stop. They'll want to know whether responses come in a steady incline upwards or in a more bell-shaped curve where demand for call takers increases dramatically and drops off gradually days later. This information is essential if you're going to be adequately staffed to capture every call and opportunity that comes in.

This marketing preparedness thinking applies to any company which hopes to get a response from people. One company we reviewed sends huge mailings to people at their homes, to be opened when people get home from work. Amazingly, we checked and learned their switchboards are closed at 5:00 sharp with not even a special voicemail message for people who respond.

Bottom line for leaders

The key to better measuring your Marketing is to start by asking and investigating what kind of information people at different levels of your company want and need to know. Expect that it will vary by tier and job responsibility.

It’s important to know that some information is much easier to accumulate than other parts. Separate out what you can’t easily measure – brand awareness and so on. There are other ways to address them. Don’t give up because you can’t track everything.

Then set up a system – with someone accountable – that tracks and gatherers that information which you can obtain. When possible, automate it. It is important that the information is checked for accuracy, disseminated immediately, and is actually reviewed and used by the right people.

Only by using a multi-tiered system can you assure that you will have access to usable information about the effectiveness of your marketing.

From our archive, first posted in July 2008

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