Winning means keeping score, and keeping score requires a scorecard. Yet in our experience, few marketing organizations are able to quantify and communicate their contributions to such critical corporate goals as raising revenue and increasing brand recognition and advocacy. It’s not for lack of actual success. Today’s paradox is that with an unprecedented amount of data, tools, and analytics at their disposal, marketers are finding it more and more difficult to demonstrate the value that they create.
Measuring the value of marketing has never been easy. And the digital revolution has compounded the complexity, drastically increasing the number of touch points between companies and consumers while raising the expectations of senior management, among others, that everything is measurable. New tools and techniques are invented daily—the number of marketing technology vendors, each with its own way of improving reach, engaging consumers, and measuring effectiveness, has exploded from 150 in 2011 to almost 4,000 today. With marketing budgets running into the billions, it is more important than ever to know—and be able to show—what’s working.
Marketing leaders who want to demonstrate marketing’s value should take a step back, look objectively at the tools and metrics in place, and ask a few simple questions:
- Do the metrics and tools capture the short- and longer-term value of marketing?
- Do they produce answers and insights that can be acted on?
- Are they readily understood by and credible to the CEO, the CFO, and the broader organization?
If the answer to any of these questions is no, a reassessment is in order, but as they proceed, marketing leadership should avoid the temptation to aim for perfection rather than confidence. That is, instead of striving for the ideal, it is far more effective and practical to apply the necessary resources to develop and build consensus around a simple set of metrics and tools that do the job well and that will consistently demonstrate value and improvement. Here are five rules, based on our experience with hundreds of marketing organizations in many different industries worldwide, that help link measurement to real business outcomes.