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Best-in-Class Marketers Widen the Performance Gap
Only 1 in 5 marketers earns top marks from the C-Suite for their ability to prove their value and contribution. 2015 MPM Study identifies 5 key differences among Best-in-Class marketers that enable them to excel at performance measurement.
By: VisionEdge Marketing
1. The pressure on the marketing team to prove their contribution to the business has not abated; the way marketing organizations respond to this pressure differs significantly and are defining. Nearly twice as many BIC marketing organizations have a performance management plan compared to their Laggard colleagues.
2. The BIC group is 5 times more likely to operate as a center of excellence compared to the Laggards.
3. The BIC group is 2 times more likely to have knowledge of the core business.
4. The BIC group is 5 times more likely to use data in an effort to understand and market to customers. For example, only 10% of the Laggards claim to effectively understand the customer experience based on data compared to nearly 50% of the BIC group.
5. Compared to the Laggards, the BIC Group is nearly 2 times more likely to use data and analytics to make strategic decisions and recommendations.
As a result of their approach and performance management competencies, at least 55% of the BIC marketers improved their ability to impact four business performance indicators: win rate, pipeline value, customer retention, and net new customer acquisition. The percentage for the Laggards who can connect their activities and investments to these competencies remains far lower.
“The differences between the Best-in-Class and the rest comes down to a few simple things, focus and commitment to excellence,”
A key component of the annual study is the grade the C-Suite gives marketing for their ability to prove their value. This year the allocation of grades are:
· Just over 20% marketers earned an A, the highest grade,
· 30% earned a B, and
· Approximately half of the marketers earned a C or lower.
The study establishes that a marketing organization’
1. The priority or importance attached to measuring marketing’s value and contribution.
2. Having a well-defined and documented plan for improving performance management and business impact.
3. Ensuring alignment of marketing with metrics and business outcomes that matter to the C-suite.
4. Addressing the way marketing operates, ideally as a Center-of-Excellence.
Over the years the research has helped characterize the differences between these groups. Those earning an A (Value Creators) operate as business people first and focus on creating value for customers and shareholders. The B’s (Sales Enablers) see themselves in service to the sales team and are primarily focused on demand generation, and the Cs and Ds (Campaign Producers) operate more like internal agencies or on-demand service providers. Only a third of the Campaign Producers have well-defined and documented plan for improving performance management and business impact compared to almost three-fourths of the Value Creators.
How marketing works matters
One of the key differences between the Best-in-Class and the rest is how marketing organizations operate. Almost half of Best-in-Class marketing organizations exemplify or function as Centers-of-Excellence (CoE); whereas less than 20% of the Sales Enablers and less than 10% of the Campaign Producers function as a CoE. The study reveals a strong link between marketing’s designation as a CoE and the presence of a marketing operations function. Over two-thirds of Best-in-Class marketing organizations have a marketing operations function, but only half of the Sales Enablers and only about 40% of the Campaign Producers have a marketing operations function.
The marketing operations function is potentially tasked with a wide range of responsibilities, but there are two worth noting that account for substantial gaps between the Best-in-Class and Laggard organizations.
1. Marketing data management: considers collection storage, hygiene, access and effective use of data.
2. Marketing strategic planning: measures the extent to which marketing is intentional about determining a direction aligned with corporate objectives, and then pursuing it.
Value creators widen the lead in four strategic areas
“Despite the steady pressure on all marketing organizations to measure and prove their contribution, the gap between Best-in-Class marketing organizations and all others is widening,” said Jerry Rackley, chief analyst with Demand Metric. “One of the reasons is simply what these organizations understand about the businesses they serve. It’s impossible to understate the importance of business acumen. When marketers understand how a business works, they are able to participate in and contribute to all aspects of how that business creates value.”
The BIC are almost twice as likely as Laggards to use marketing metrics to show the connection between marketing’s results and corporate business objectives.
This year’s study found that Best-in-Class marketing organizations are not only maintaining their lead over the rest of the marketing field, but widening it by focusing on four strategic areas:
1. Business acumen.
2. Customer knowledge
3. Data and analytics-based strategy
A free copy of the report summary is available on either the Demand Metric or VEM websites. The results will be presented on Wednesday, April 29th, 9 am eastern US, at the Tales from the Marketing Performance Pack Leaders: How They’re Widening the Gap (http://bit.ly/