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 question is, 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.