Marketing
Issue No. 19 - October/November 2004
Measuring marketing effectiveness
Marketing metrics
by Dr David Corkindale
Marketing Metrics
Measuring the effectiveness of marketing has been growing in prominence over the last half-dozen years and the term for data that might help you do it is marketing metrics. Even at this year’s Marketing Week in Adelaide, there was a session devoted to it. The Australian Marketing Institute has promised to produce a report about it, but unfortunately it has been delayed. So, let’s have a look at what is a long-standing concern of many who manage companies and businesses: what do we get for the money we spend on marketing?
You can measure effects
The first thing to emphasise is that, contrary to what some marketing people tell you, you can usually measure the effects of the overall marketing budget and/or a specific marketing activity. The RoI on marketing is quite possible – if you are prepared to collect the necessary information.
I know a petrol station owner who undertook a new marketing initiative. Over the next few weeks he systematically asked his customers and particularly the "new faces", why they were there and he also monitored changes in volume. He got a pretty good idea of the effect of his initiative and why it worked.
Some people worry that he may have been lucky in that something else in the world influenced response or that his initiative could have been somewhat negated by a competitor. True, these things might happen but if the effect of your initiative, in this sort of operation, is not detectable by some simple method then this probably means it did not work and was not worthwhile. If you don’t seek to find the effect you will never know.
Some advertising agencies now claim they are "paid by results". This is a response to their clients wanting to feel that they are able to report the return on advertising expenditure. Generally what happens is that the client and the agency agree on some objectives that the advertising is capable of achieving and some targets ...
