In Fall 2007 Marketing Operations Partners published the benchmarking study, “Journey to Marketing Operations Maturity.” At the time, the study found that the biggest challenge marketers faced was demonstrating measurable return on marketing. In addition, marketing accountability was identified as the key area where the greatest improvement was expected between current performance and near-term (one year) performance. The results from VisionEdge Marketing’s just-released Marketing Performance Management; Measurement Survey reminds us that a focus on accountability and measurement alone is not enough to realize our own self-expectations of improvement, let alone pacify our C-team.
VisionEdge Marketing announced the results of its eighth annual Marketing Performance Management and Measurement (MPM) Survey. Two hundred and thirty business and marketing executives and professionals responded to the online study conducted mid-February through mid-March. This year’s survey results reveal three findings:
1. Marketing still has a long way to go in ensuring it is aligned to the business and measuring its performance.
2. Marketing still lacks the skills and capabilities to run like a business.
3. When it comes to customer-centricity, Marketing is not always looking at the right metrics.
The findings from the study indicate that marketing still remains challenged with the basics of a marketing performance management practice and is losing ground in its ability to represent its value to the company. The results show that while Marketing is still focused on MPM as a priority, Marketing and marketing professionals continue to be challenged with actually following through in practice. Despite continued emphasis on MPM, Marketing is losing ground in its ability to represent its value to the company.
“Without improving marketing’s ability to measure performance, marketing will continue to see a gap in alignment with business objectives and will lack the ability to improve effectiveness and efficiency,” said Laura Patterson, president of VisionEdge Marketing.
Last year’s survey results indicated four key disconnects. Unfortunately, this year’s findings indicate that gaps for two of these disconnects, alignment and metrics, still exist and that for two others, skills and best practices, the gap is increasing. Marketing leadership may believe they are aligned with the business, but in fact that is not the case as they are unable to show how marketing activities are linked to business goals, demonstrate how marketing impacts the business and measures its financial contribution. Six key takeaways from the study include:
Marketing is still not making the grade. Marketing Leadership (CMOs/VPs) assume CEOs give them high marks when in reality only a small portion would actually give Marketing an ‘A’. The real story is the disconnect between Marketing Leadership and CEOs. Only 17% of CEOs would give marketing an ‘A’ where as 48% of Marketing Leadership thinks this is the grade they would receive.
The Marketing Operations function is under utilized. While the majority of marketing organizations (80%) have a marketing operations department to institute an MPM practice, it is under utilized, lacking the necessary analytic skills, process, tools, and access to data to be effective. The majority of marketing operations organizations (60% or more) do not support performance measurement capabilities.
Satisfaction with data analytics, measurement and process skills still remains low. Despite the lack of satisfaction, training budgets to offset this gap remain minimal.
Marketers don’t leverage best practices when it comes to marketing performance management. Benchmarking and audits, considered a best practice, are typically not conducted on a regular basis or conducted at all. However, this contradicts the fact that marketers find following best practices important.
The link between marketing and the business remains weak. There is a high expectation for executive and operational metrics that link to business goals to be reported on. But in practice, this is not happening and for many marketing organization there are no plans to track these metrics.
Customer-centric metrics are too low on the metrics list. Economic conditions are forcing businesses to be more customer-centric and focus on customer retention. Only a third of the study participants track metrics such as length of customer tenure, purchase frequency and recency, and the value of the overall customer base. Even fewer track customer lifetime value and share of wallet.
For a performance-driven marketing culture to thrive, marketing organizations are going to need to invest in the process, skills, tools, and data. The findings suggest Marketing professionals and leaders need to reskill, retool and put better marketing performance management processes to improve marketing measurement and accountability. To go beyond activity reporting, marketers need training to enhance their analytics, process, measurement, and reporting skills.
The 2009 Report, “Closing the Gap between Marketing and the Business,” provides the complete findings and can be purchased for $200 for a limited time, a 20% savings.
In light of findings, VisionEdge Marketing’s book, Metrics in Action: Creating a Performance-Driven Marketing Organization continues to be highly relevant. Marketing Metrics in Action provides a roadmap to address the gaps identified in the study. The book covers topics such as how to create outcome-based metrics for your organization, develop a dashboard, and align marketing closer to the business. The book can be ordered directly from the publisher.