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As a marketing person, one can’t escape the reality that the reason we study the details is so that our products and services reach their full potential.

This is essentially the answer to our question of “Why?”

If, in all our analytical glory, we miss the fact that our numbers mean nothing and they haven’t been used to improve the bottom line – then we’ve failed.

What’s the use of collecting all the data if we forget why we do it? Just to be showy? Prove how talented we are at gathering figures and information?

I recently read an interesting article about FBI Director Bob Mueller in TIME Magazine. He has made over an agency that’d gotten sloppy and lazy in how it was thinking and acting – “Mueller remade the bureau in his image, pushed out the old guard and hired more than half its present cohort. Mueller inherited 56 field offices, each a distant fiefdom run by a special agent in charge. Old-school Special Agents measured progress by arrests.”

So what does this have to do with marketing?

The FBI used to measure success by how many arrests it had made. To a non-law enforcement expert, such as me, this seems logical. But Director Mueller didn’t read the numbers the same way, he dug deeper challenging those agents who were arresting petty thief’s to stop padding their numbers and to do work that made a real difference to the community as a whole. Arresting car-jackers wasn’t nearly as important as thwarting terrorist attacks for instance.

“How are you measuring positive community impact?” Mueller would ask.

What a great question. Getting bad guys off the streets is good, but for the amount of time and resources it was taking to fight crime and then to see little return on this investment frustrated Mueller. He was basically asking what was the ROI on those arrests for the community? That’s what mattered most.

If you forget why you are collecting the data, I encourage you to get back to asking the question – “Why?” and figure out what matters most. In the long run this will help you and your company succeed.

Can You Trust Your Gut?

So if you are like the typical small business, most likely you are looking for some easy ways to track the success of your advertising?

One of my favorite ways, and easiest as well, is to track conversion rates.

Conversion Rate:

This is the percentage of people, customers, and clients who do something you want them to do.

So for instance if you run an ad in the newspaper, how many new orders/customers did you gain? And how much better/worse did you perform based on the previous month/year during this same period?

Advertisement ran for 1-week.
Generated an additional 100 calls.
Closed 33 deals.

Conversion rate = 33%

It really is that simple. Yes you really should keep track of this kind of data, once it is included with some other metrics you will be armed and ready to dominate that market.

I will say it again:

Barely half of all businesses measure their marketing efforts in any way.

And

Marketers who understand and use these tools will outperform those operating in the dark.

Winning is the name of the game, and you will win faster by measuring even at a basic level.

We all tend to have a love hate relationship with our advertising.

We know we need it. We hate spending money on it. And we love it when it works.

The money you invest in your marketing is precious. In order for you to maximize your advertising spending you need to know what worked and what didn’t. Marketing Metrics and formulas are tools that allow marketers to make better decisions about their advertising.

If you are unable to tell what leads and sales were generated with specific marketing efforts then you have no way of knowing what is working and what isn’t when it comes to your advertising.

You are not alone if you do nothing currently. A recent poll conducted by the Silicon Valley American Marketing Association among 3,500 of its members found that barely half measure their marketing efforts. Marketers who understand and use these tools will outperform those operating in the dark.

Let me say that again… Marketers who understand and use these tools will outperform those operating in the dark.

A negative economy can be a crisis situation for many businesses, but it was President Kennedy who reminded the nation

“When written in Chinese the word crisis is composed of two characters. One represents danger while the other represents opportunity.” It means opportunity for those who are prepared to take advantage and danger for those who aren’t.

The more visible you are, the more confidant your customers and prospects become. The more they are reminded of your legitimacy and staying power, the more they’ll be inclined to believe you’ll be there for them tomorrow.

Remember too that during any period of economic downturn your best customers become someone else’s best prospects. When you stop inviting them to do business with you, a more aggressive competitor may become much more attractive.

In a bad economy, there are many opportunities to expose your business to new customers that aren’t always possible in a good economy.

For instance, during down economic times you can get better deals on advertising. I was responsible for purchasing some billboards in Kansas City for a project in 2009. What I discovered was that for half the price of the previous year I got double the boards!

Don’t be afraid to address the bad economy in your advertising either. Travelocity aired a simple commercial to announce its Silver Lining Sale. In the first three seconds, you see the words, “We know times are tight.”

Wal-Mart is running an effective ad campaign. The commercials don’t say, “Hey, come on out. We’ve got electronics, clothes, sporting goods, prescriptions and more at a low cost.” Instead, the ads focus on very specific items and how much you’ll save over a year by purchasing these items directly from Wal-Mart.

The world’s largest retailer, according to Advertising.com, posted its best sales performance in nine months, with a 5.1-percent sales gain in February 2009 as a result.

Which character will your company be? Danger or Opportunity?

Insulting our intelligence

“I am well educated, smart and sophisticated. Much smarter than you.” – at east that what it seems like advertisers these days are trying to tell me with their ads.

Advertisers need to remember that in America today many schools teach critical thinking skills. We learn to question everything, to be skeptical because it develops our cognitive skills. So knowing this, advertisers need to realize – if you are talking down to customers they won’t react well.

Here’s one example of a TV commercial that just comes out and insults our intelligence from start to finish, even with a catchy jingle and humorous lyrics: the Free Credit Report.com spot. They say they’re “free” – it’s in their name, sing about being “free” and yet at the very end they quickly state, “offer applies with enrollment…” and in order to enroll you must use your debit/credit card. So I guess it’s not free.

FreeCreditReport.com you treat me like I am an idiot, so I choose to ignore you, forever.

Another example is Honda’s Cog TV spot, thought to be to complicated for the US market, it was never released here. Judge for yourself if this concept seems far too difficult to grasp?

We are all experts about the products we market and sell (or should be), but let’s be careful about assuming to little about our customers.

Yo, you paying attention?

Are you aware of the things you need to be focused on day to day? Or do you find yourself pulled from one project to another with barely a minute for reflection? Taking your eye off the ball?

Well you can’t lose sight of the goals, and I do hope you have some (personal and professional). In the fast pace world of advertising where customers are fickle and the rules of success change daily we need to remain locked in on the goal – always. If the goal is sell/promote X then we can’t allow our selves to get pulled into meetings for Y, and caught up in discussion around Z, it’s the quickest way to fail.  The list is long of companies who got distracted: Sony Walkman, GM, Lehaman Brothers, ENRON and even Tiger Woods.

How tuned in are you? watch this brief video, you may be surprised at the results.

If you’re like me, then one of the constant challenges you face everyday is knowing how to show the value of your marketing efforts. And this is not any easy task because many CEO’s see marketing as a financial black hole.

While the CEO and the CFO debate and discuss the productivity of the company or the return on investment of certain initiatives, the marketing department rarely gets held to such high standards. This may seem like a blessing in disguise, but the reality is, until marketers can show value and measurement of their efforts they will not be allowed to sit at the big boy table in the boardroom.

Over 80% of companies surveyed expressed dissatisfaction with their ability to measure impact and marketing performance, 80%!

Certainly marketing has always been known as “the unexplainable art”. I maintain that marketers need to be asked to justify and account for performance. Companies who have been able to develop these metrics show superior financial returns and have higher CEO confidence in their marketing divisions. Higher confidence in turn will bring more money, and that’s something any marketing department could use more of these days.

We must consistently develop and demonstrate success in measuring our marketing efforts. Continuously measuring marketing performance will help satisfy the management need of CEO’s and Accountants, while enabling marketers to demonstrate the contribution of the marketing to the business.  Ok if that seems a bit wordy, how about this, marketing teams need to show they are winning or they will eventually discover that the business is going to lose.

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