Where to start? Begin by establishing and gaining agreement on performance targets and metrics, and putting in place the mechanisms to track and report on progress against goals.
Marketing performance measurement and management (MPM) is the process of analysis and improvement of the efficiency, effectiveness and accountability of marketing investments and activities. This is accomplished through alignment of marketing activities, strategies, and metrics with business objectives.
A marketing performance measurement framework can be a useful tool for developing those measures and metrics most relevant to an organization’s strategic growth goals. Three categories of measures are often considered:
- Enterprise growth: measurement of overall performance against business outcomes, growth goals and competitive sustainability; e.g., revenue growth, profitability, market position, brand leverage, etc.
- Marketing strategy: measurement of return on marketing investment (ROMI) from core marketing strategies and processes; e.g., high-impact segmentation strategies, service line development, market expansion, portfolio diversification, retail innovations, clinical partnerships, etc.
- Marketing activities: comparative measurement of effectiveness, efficiency and outcomes of specific marketing and sales tactics or programs; e.g., direct mail campaigns, web traffic, risk screening events, physician sales,
So what are the critical success factors for marketing performance management?
- Making marketing performance measures, monitoring and reporting systems a priority
- Targets and metrics aligned to strategic planning, business development and operations priorities
- Decision support systems with timely access to performance data
- Cross functional collaboration to set and agree on targets and metrics
- Cross functional accountability for outcomes
- Regular reporting intervals to review progress against goals
- Timely adjustments to strategy and/or course corrections
What have been your successes and challenges in marketing performance measurement?
2 comments:
Karen, thanks once again for a thoughtful and timeley post. Our experience shows that marketers and C Suite execs too often rely on historical metrics such as awareness and preference, etc. Clearly the more dynamic market we are in requires more insightful metrics and higher accountablility. But often times this requires a cultural change that is difficult to achieve certainly short term. The successes we have seen usually originate with marketers who take the lead by educating management and other leaders on options that are available to them, what's worked in other industries that can be applied to hospitals and a focus on meaningful metrics. As Jim Collins wrote in "Good to Great", "Face the brutal facts." Hospitals have no choice on that issue and marketing leaders can be the ones to point their organization in the right direction and become the focal point of revenue growth. If marketing wants to continue to have a vital place in hospitals, it clearly must embrace the concepts you have outlined. And more.
This is a key challenge for many marketing execs and has struck a chord. I've had two marketing execs mention this post to me. I agree with Art, if marketing is going to be viewed as leaders of growth, then we have to have the right measures in place, and an effective method for reporting them. Reporting ROI on campaigns without the more focused growth measures, just reinforces the perception of marketing as all about MarComm.
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