MRM Webinar Part 1

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Part 1 of a case study on marketing resource management software which covers key metrics in marketing.

Part 1 of a case study on marketing resource management software which covers key metrics in marketing.

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  • One Marketing director carefully tracked three Marketing outcomes: conversion rates, acquisition costs, and satisfaction. After the launch of a new product, she carefully tracked lead and conversion activity and used this information to help better focus the Marketing efforts. From Marketing project to Marketing project, she was able to track performance with real quantitative evidence of how well each effort performed and produced. A second Marketing director didn't bother with Metrics. He wasn't willing to allocate the resources and effort into metric collection. She believed she was doing her job because her focus was on completing the projects her manager requested on time. She did attempt to gauge "lead" activity and web site effectiveness with a web-analysis tool that provided some general web traffic data. Today, both companies are going through budget cuts. What do you think happened to each person's budget? You're probably right. The first Marketing director was able to salvage a larger percentage of her budget and allocate it for those activities that are producing results. Our friend at the second company lost most of her budget and all of her people. As time goes on, the historical data that ongoing metric collection provides speaks for itself

Transcript

  • 1. Laura Patterson President & Author [email_address] 3 Perspectives on Marketing Management Excellence Key Metrics for Measuring Marketing’s Value
  • 2. About VisionEdge Marketing
    • Founded in 1999 and headquartered in Austin, TX, VisionEdge Marketing, Inc. serves more than 100 customers, and counting.
    • VisionEdge Marketing, Inc. is a data-driven and metrics-focused marketing firm that specializes in improving marketing performance and creating competitive advantage designed to attract, secure and retain profitable customers.
    • Services include…
      • Marketing performance management
      • Marketing and sales alignment
      • Product and strategic marketing
      • Pipeline re-engineering
      • Professional development
  • 3. Today’s Objectives
    • The Role of Marketing
    • Why Key Metrics Matter
    • Defining MPM and Performance-Driven Marketing Organizations
    • Challenges/Journey to Get There
    • Key Marketing Metrics
    • Success Factors: Processes, Culture, and Proficiency
    • Ten Steps You Can Take Now
  • 4. Where Do We Start?
    • Marketing’s purpose is the purpose of Business
    AMA Definition of Marketing Create, communicate, and deliver value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. “ The purpose of a business is to create a customer .” - Peter Drucker
  • 5. 3 Ways to Achieve our Job
    • Find Profitable Opportunities
      • The process of acquiring/ securing customers
    • Keep Profitable Opportunities
      • The process of retaining customers
    • Grow Profitable Opportunities
      • The process of increasing the value of your customer franchise and brand
    Find/Secure Profitable Customers Acquisition Keep Customers Penetration Grow Customer Value Monetization Market Share Lifetime Value Brand/ Customer Equity
  • 6. A Tale of 2 Marketers
    • Tracked Trial Rates
    • Measured Adoptions Rates
    • Focused on Category Growth rate
    • Tracked Pipeline Contribution
    • Tracked everything Web
    • Press Hits
    • Measured Awareness
    • Focused on Lead ROI
  • 7. Performance Management
    • … the process of measuring progress toward achieving key outcomes and objectives in order to optimize individual, group or organizational performance.
    CMO Council's 2008 Marketing Outlook
    • “ The top challenge for marketers remains to better quantify and measure the value of marketing programs," in spite of improvements in accountability over previous years.
  • 8. 5 Characteristics of a Performance-Driven Marketing Organization
    • Clear standards
    • Aligned resources, policies, and practices
    • Results tracked and reported
    • Data is used to drive continuous improvement and to hold the entire system accountable for performance.
    • Fact-based decision making
    A performance-driven organization has a set of measurable performance standards, a pointed focus on outcomes, and clear lines of accountability - all of which are important if a marketing organization wants to prove its value.
  • 9. The Value of Measurement and Metrics
    • Communicate impact
    • Be seen as accountable
    • Demonstrate financial contribution
    • Enable us work smarter
    • Provide a current picture (market share, product margins, close rate)
    • Indicate future performance (projected revenue, share of wallet, net advocacy)
    • Empower Marketing
      • Influence decisions
      • Recommend action
      • Play a strategic role
  • 10. Four Hurdles Marketers Must Overcome Measuring and Documenting Marketing’s Value Measurement Competence Metrics too Tactical Data, Analytics and Measurement Skills
  • 11. 3 Changes We Must Make
    • Transform
      • Into a performance-driven, outcome-centered organization
    • Shift
      • From Tactical to More Strategic - broaden focus from sales support to a marketing framework linked to business outcomes
      • To metrics that impact the organization’s economic performance & strengths both financial & NON-FINANCIAL goals
    • Balance
      • The ROI of current programs while still driving strategic issues that impact long-term viability
  • 12. If We Change, Will it Matter?
    • Companies with “formal & comprehensive” Marketing Performance Management System:
      • Outperform companies entering consideration phase
      • Performance ratings of 29%, 32% & 37% better in sales growth, market share & profitability
        • CMO Council/Business Week MPM Survey
  • 13. Will It Make a Difference?
    • Best-in-class marketers measure specific metrics that link marketing efforts and overall business goals. These marketers and their companies consistently demonstrate higher performance in four areas:
    • rate of customer acquisition
    • rate of customer retention
    • annual increase in gross revenues
    • return on marketing investment
    - Aberdeen Group
  • 14. Five Best Practices for Creating a Performance Measurement Systems
    • Data and Analytics – the foundation of Metrics
    • Metrics and Measurement – the route to ROI
    • Defined and Documented Processes
    • Systems and Tools
    • Reporting Results
    • Two gating factors
    • Culture
    • Skills and Capabilities
  • 15. Key Metrics and Performance Indicators Certain Facets of Performance Move Needles for Each Gauge
    • 5 Customer/Brand Equity Indicators
      • Price Premium
      • Net Advocate Score
      • Customer Franchise Value
      • New Product Acceptance/ Adoption Rates
      • Product Margins
    • 4 Lifetime Value
    • Indicators
      • Purchase Frequency
      • Share of Wallet
      • Advocacy/Loyalty
      • Tenure
    • 5 Market Share
    • Indicators
      • Share of Preference
      • Share of Voice
      • Share of Distribution
      • Rate of Customer Acquisition
      • Rate of Growth:Market
  • 16. Characteristics of Effective Metrics
    • Accurate and Precise
    • Reliable
    • Relevant
    • Aligned
    • Owned
    • Predictive
    • Actionable
    • Easy to understand
    • Transformative
    • Standardized
  • 17.
    • Three layers to the marketing dashboard:
    • Executive level Strategic level – monitors and measures performance against business outcomes and marketing objectives
    • Operational level Marketing management – tracks performance of core marketing strategies and processes
    • Tactical level Functions and individuals – analyzes performance at project or activity level as they relate to the first two
    Marketing Dashboard Construction
  • 18. Success Hinges on Three Factors Processes, Systems, Tools Skills & Training Culture
  • 19. Processes
    • Establish a process that enables the organization to make adjustments in real time – rather than looking in the rear-view mirror
    • Leverage Industry Best Practices and Company Insights for continuous improvement opportunities
    • Deploy processes that allow you to modify metrics and the dashboard design as needed
    • Do you have these processes documented?
      • Data collection and analysis process
      • Program performance target setting process
      • Metrics and Measurement process
      • Reporting and dashboard process
  • 20. Ten Steps You Can Take Tomorrow
    • Conduct a metrics audit to take stock the state of your marketing organization's performance, identify gaps, and begin to fill those gaps in order to make marketing more effective and accountable.
    • Identify 3-5 business outcomes. Use a mapping process to ensure that business outcomes, marketing objectives, key performance indicators, and marketing metrics are linked.
    • Understand the continuum of marketing metrics, from activity-based to leading-indicator and predictive measures.
    • Engage the CEO involved in improving marketing performance
    • Make an ally of Finance
  • 21. Ten Steps You Can Take Tomorrow
    • Align marketing with sales
    • Develop a marketing dashboard and specification tailored to your organization's strategic and tactical measurement, tracking, and reporting needs.
    • Identify systems and tools that can automate many marketing processes and improve the performance and reporting capabilities of your organization.
    • Determine the crucial skills marketers need in order to implement the changes in culture, activity, and communication that businesses demand from a performance-driven marketing organization.
    • Focus on developing a culture of accountability that will be able to implement performance-driven marketing and demonstrate its value to the business.
  • 22. Thank You and Questions
    • Metrics in Action: Creating a Performance Driven Marketing Organization
    • Workbook: Metrics Conditioning For Your Best Performance Yet
    • Both are available at www.visionedgemarketing.com