Marketing activities are not just creative projects launched individually to drive client engagement and increases in revenue. Marketing initiatives offer measurable and trackable opportunities for startups and small companies to gauge client perception of a brand and interest in an offering. Gaining valuable insight into the purchasing decisions, demands and expectations of target audiences will strengthen future marketing efforts, as well as client relationship management, business strategies and IT adoption. Invaluable client data is driving innovative, proactive and consumer-driven industry advancements that allow burgeoning businesses to compete with larger counterparts.
It is the responsibility of entrepreneurs, therefore, to take full advantage of available marketing data derived from past campaigns and apply the insights into all aspects of business management. Leaders must understand the importance of collecting, monitoring and analyzing client data streams to support advantageous marketing schemes, and invest in data-driven IT investments to enable these activities.
Companies must realize how marketing efforts are part of an integrated strategy to enhance client engagement and loyalty in the long-term through consistent focus on service and market demands. To ensure departments are optimizing use of big data streams for more insight on client behaviors, entrepreneurs should consider implementing marketing performance management metrics and methodologies. When a business allows marketing data to support decision making in all aspects of operations, the focus will always remain on the client’s needs and help maintain strong relationships.
How do you measure and monitor marketing department performance?
Data-Driven Marketing Metrics
With the rise of big data streams invading company computing systems, stemming from a variety of sources, entrepreneurs have access to more specific information to guide targeted campaigns. As more businesses enter the marketplace and offer consumers a larger variety of providers to choose from, standing out from the rest with a strong use of data analytics can help small businesses overcome budgetary discrepancies. While a large company may have the means to launch widespread campaigns, a smaller business with actionable insight gathered from data streams can send more personalized messages to key demographics and enjoy a higher return on investment.
When social media and mobile devices started to play a greater role in economic activity and client interactions, new breeds of data sources arose and increased demand for more sophisticated data analytics and marketing performance metrics. Now companies cannot afford to ignore social business data and mobile information streams when designing marketing campaigns, and entrepreneurs must ensure a diverse array of reports are presented on client behaviors through these various channels to fully support decisions. The most important metrics include:
- Client acquisition cost: total sales and marketing expenditure
- Marketing percentage of client acquisition cost: illustrates where overspending may be happening or when important quotas are missed
- Ratio of customer lifetime value to client acquisition cost: collect revenue from a customer in a set period of time, subtract the gross margin and divide by the estimated cancelation rate to determine the value of a long-term relationship
- Time to payback client acquisition cost: how long it will take a company to earn what was spent on acquiring a client
- Marketing originated client percentage: shows how many clients were gained or how much revenue was generated from individual campaigns
- Marketing influenced client percentage: similar to marketing originated client percentage, but adds in new transactions nurtured by marketing efforts over time
Within a company’s marketing metric funnel, business leaders should score and categorize potential and existing client profiles based on data feedback and make the information accessible to decision makers across the company. Understanding how unique audiences respond to messaging and offerings will guide selections on campaigns, platforms and investments moving forward, while avoiding making costly mistakes that could hinder growth potential. Marketing metrics can provide insight into how campaigns and research are paying off for the company’s bottom line and profit margins.
Do you know if your marketing efforts are a success?
Performance Management Basics
Marketing performance management strategies require department heads and business builders alike to measure gains from initiatives and compare those to expenditures and growth strategies. Performance management must be implemented start to finish, from when a potential lead is first contacted to the follow-up communication after a transaction is completed.
Leaders must start by developing standards for lead development and sustainability. Teams can collect marketing data and analyze the findings to pinpoint patterns and trends that demonstrate successes or failures. By using benchmarks created during goal strategizing sessions, entrepreneurs can measure the metrics against desired endpoints to see how effective the marketing team is at achieving specific results. Marketing performance management strategies should also be used to define the expectations of marketing leadership such as:
1. Providing high return on investment
Entrepreneurs are always feeling the squeeze of resources and manpower, and are looking to department heads for sources of innovation and advancement without increased spending.
2. Enabling long-term innovation
Entrepreneurs should also expect marketing teams to leverage detailed data streams as sources of insight to fuel creative campaigns and other differentiating activities. Because budgetary restrictions prevent small companies from outspending competitors, clever use of data must provide alternative options for advancement.
3. Improving client relationship management
Marketing data will provide benefits not only to marketing teams directly, but also boost insight into client demands and expectations needed by client relationship management departments. Sharing data on client behaviors and preferences will impact service departments as well as marketing campaigns, improving the client experience from start to finish.
4. Enhancing business strategies
Entrepreneurs must always be on the lookout for new sources of information and strategic planning. Marketing departments equipped with targeted data analysis can help guide decision making when considering to branch out into new markets or improve a public image.
Make sure marketing data is not only relatable to marketing teams, but can be translated into comprehensive benefits for other departments as well. Entrepreneurs must access marketing data regularly to guide decision making and support internal projects, as well as communications with targeted audiences.