Why the board isn't impressed with marketing
Nearly half (49%) of companies are not yet using customer metrics or marketing metrics to help inform board-level decision making, leading to a general sense of C-level disappointment with the marketing function, according to research from The Chartered Institute of Marketing (CIM) and Deloitte.
The report, entitled 'Improving marketing effectiveness: Leading practices in marketing accountability', investigates how companies measure the performance of marketing and act upon the results, based on a quantitative assessment of over 200 senior marketers and board level executives.
The survey found that most companies are in fact measuring basic customer and marketing metrics. For example, more than 90% measure customer satisfaction, rate of acquisition and retention, and many say they are doing so effectively (66%, 60% and 51% respectively). However, only half believed that their executives drive change as a result of marketing or customer metrics, suggesting that marketing metrics are not a core part of the decision making process for corporate investment.
Nick Turner, head of marketing effectiveness for Deloitte, and one of the report's authors, explained: "This research really begs the question: what's the point of measuring marketing if companies are not going to take decisions based on that insight? With half the organisations surveyed not using customer and marketing measures, board level executives should ask themselves what really drives their decision making process before pointing the finger of accountability at the marketing department".
"Measuring the impact of marketing investment is an investment in itself; it takes time, expertise and budget - all of which are in short supply," added Thomas Brown, head of insights for the CIM. "If half of businesses aren't using what their metrics tell them to drive change, their leaders should be asking 'do we have the wrong metrics, or do we have an education imperative within the business?'. In many cases, it may be the latter - an area often overlooked."
This study followed previous research into marketing effectiveness by both Deloitte and the CIM that identified measurement as a common theme prevalent in companies struggling to articulate the role of marketing and its value in their organisation. In that research, 81% of respondents agreed that their organisation's marketing strategy was aligned with their organisation's overall corporate strategy, while only 37% thought that their business strategy was clearly translated into marketing objectives.
The report therefore points to the alignment of marketing and corporate strategy, the definition of marketing accountability, and having the 'right' marketing measures (as opposed to the easiest) as the key areas on which companies should focus to achieve real marketing effectiveness and true customer focus.