According to new research, many marketing departments are still unable to convincingly represent their true value to the company and are, in fact actually losing ground.
The results of VisionEdge Marketing's eighth annual Marketing Performance Management and Measurement (MPM) Survey reveal three main findings: marketing still has a long way to go in ensuring it is aligned to the business and measuring its performance; marketing still lacks the skills and capabilities to run like a business; and when it comes to customer-centricity, marketing is not always looking at the right metrics.
The report reveals that while marketing is still focused on MPM as a priority, marketing departments and professionals continue to be challenged with actually following through in practice. Despite continued emphasis on MPM, Marketing is losing ground in its ability to represent its value to the company.
Last year's survey results indicated four key disconnects. Unfortunately, this year's findings indicate that gaps for two of these disconnects, alignment and metrics, still exist and that for two others, skills and best practices, the gap is actually increasing. Marketing leadership may believe they are aligned with the business, but in fact that is not the case as they are unable to show how marketing activities are linked to business goals, or demonstrate how marketing impacts the business and measures its financial contributions.
Among the survey's highlights:
- There is a disconnect between marketing leadership and CEOs. Only 17% of CEOs would give marketing an 'A' whereas 48% of Marketing Leadership thinks this is the grade they would receive.
- While most marketing organisations (80%) have a marketing operations department to institute an MPM practice, it is underused, lacking the necessary analytic skills, process, tools, and access to data to be effective. Most marketing operations organisations (60% or more) do not support performance measurement capabilities.
- Satisfaction with data analytics, measurement and process skills still remains low. Despite this lack of satisfaction, training budgets to offset this gap remain minimal.
- Marketers don't leverage best practices when it comes to MPM. Benchmarking and audits, considered a best practice, are typically not conducted on a regular basis or not conducted at all. However, this contradicts the fact that marketers find following best practices important.
- The link between marketing and the business remains weak. There is a high expectation for executive and operational metrics that link to business goals to be reported on. But in practice, this is not happening and for many marketing organisations there are no plans to track these metrics.
- Customer-centric metrics are too low on the metrics list. Economic conditions are forcing businesses to be more customer-centric and focus on customer retention. Only a third of the study participants track metrics such as length of customer tenure, purchase frequency and recency, and the value of the overall customer base. Even fewer track customer lifetime value and share of wallet.
For a performance-driven marketing culture to thrive, marketing organisations are going to need to invest in the process, skills, tools, and data. The findings suggest marketing professionals and leaders need to re-skill, re-tool and put better MPM processes in place to improve marketing measurement and accountability. To go beyond activity reporting, marketers need training to enhance their analytics, process, measurement, and reporting skills.
The report, entitled 'Closing the Gap between Marketing and the Business', provides the complete findings and can be purchased for US$200 for a limited time - click here.