This article is Part Four in a five-part series where I discuss the Five Steps to Data-Driven Marketing.
CMOs, how do you demonstrate that your marketing efforts contribute value to the business? Here’s the best way: Use metrics to measure your progress. No, I’m not talking about how many “liked” your Facebook page or the number of clicks on your website. I’m talking about tracking results, such as the returns from your latest media buy or the increase in marketing-qualified leads. I’m talking about showing precisely how marketing’s effectiveness and efficiency is improving. The proof you need is in the metrics, and that’s why I’m always telling my team, “Marketers, you need to make metrics your mantra.”
Here’s the problem, though: Many marketers are anxious about implementing metrics; they’re just not accustomed to this level of scrutiny. In my upcoming book, I tell the story of the CMO of a large well-established financial services institution who confessed to me that measurement made her team “nervous.” They had endured several organizational realignments and –no surprise –saw metrics as a negative tool senior management could use to “manage” marketers right out of their jobs.
Others marketers seem convinced that embracing metrics isn’t even possible; they’re tangled in the data hairball and feel certain that modern marketing practices have grown too complicated and unwieldy to accurately measure. That’s understandable, too.
But as marketing leaders, we can no longer succumb to fears or confusion. And we can no longer settle for “making do” with antiquated approaches to marketing operations.
Start by determining exactly what and how to measure. For instance, is your leadership team on the same page regarding Return on Investment (ROI) versus Return on Marketing Investment (ROMI) versus Return on Marginal Marketing Investment (ROMMI)? Which of these metrics is most relevant to your company and its business objectives?
I can guarantee one thing: The C-suite will not be impressed with the number of website clicks, Twitter followers or Facebook “likes.” Executives want results. They don’t want to look at metrics for metrics’ sake. So use metrics that clearly demonstrate marketing’s contribution to the company’s objectives, such as ROMI or the number of marketing-qualified leads. In other words, give them want they want.
And please . . . Don’t get lost in data. Instead, stay focused on results and make sure everything ties back to your strategy. Work with your peers, your CEO and your team to understand what metrics matter and which outcomes will drive true value to revenue and customer retention. Then, work to measure broadly and deeply. Most importantly, take action on the insights gained from the metrics to optimize your marketing.
Today’s CMOs have to develop a holistic view of marketing. We have to work to understand the best way to measure marketing initiatives and activities, and we have to ensure the entire organization understands and see values in the metrics we bring back.
Just like the other elements of data-driven marketing I discussed in Step One: Get Smart, Get Strategic, Step Two: Tear Down the Silos and Step Three: Untangle the Data Hairball, establishing metrics can be a daunting task—but it’s one that’s well worth the effort. Aligned metrics will provide you with more confidence in decisions, improve granularity about what to focus on, enhance your accountability and strengthen buy-in and alignment across the enterprise.
Next is the final post in my five-step series about how to implement data-driven marketing –Step Five: Process Is the New Black.
Photo credit: http://www.flickr.com/photos/networkosaka/8512416918