Marketing Metrics

The Marketing department applies metrics,  measures, and determines how successful a business can become.  Metrics is a marketing tool which is utilized to measure advertising and direct mail responses, customer relationship management (CRM), market share and Return on Investment (ROI).  In order to provide the results of these metrical evaluations, marketing will come up with a suitable marketing plan, show how this marketing plan is applied, provide recommendations for improvement, and name the most important metrics.

Metrics is the measuring of results and a part of marketing efforts.  Metrics is  necessary in order to focus on justifying the efforts of marketing and to prove to management that marketing is of value to the agency.  (Hamilton, L., .  Metrics provides a scorecard which includes focusing on priority areas or what is important at a glance.  It is an instrument  to watch,  manage, improve, and reward performance, and it helps to improve every process and procedure.  Metrics  determines what is important and what needs immediate attention.  (Cognos).  It can also allow marketing to see more than one result at a time when all key performers get together for one review.

Metrics also allows seeing below the data and the reason for the results.  Finally it allows one to take immediate corrective action to identify problems before they happen so that changes are made before something negative happens.  (Cognos).  All of this helps marketing to align a certain team strategy within the marketing mix, communicate goals, and watch how well advertising performs.  It provides a picture of  how goals are reached.  (Cognos).

When a scorecard is implemented, marketing will be able to help ensure ownership and prove accountability for performance.  Scorecards are  created along with diagrams, and when they needed this information is used again and again to help provide consistency and  definition of targets.  Status indicators will also show the progress against each target which marketing is trying to improve.  (Cognos).  Certain areas or locations  need  improve and marketing will work from there.

Metrics  it helps  to focus on profitability and not just revenue, because it gives a common sense approach.   A bank-based financial service company may track loan performance and not just the dollar value. A company gathers previous loan history information and after reviewing this data,  improves  credit and product policies.  A company will find out how fast loans in the past have matured, how they are paid,  and/or how they became delinquent.  All of this helps to cut financial loss.  Business intelligence aids their efforts.  Any significant changes could be monitored and improved and this helps a company see its general weaknesses.  (Cognos, p6).

E-mail is an important avenue for employing metrics in marketing because it delivers what is measurable.  E-mail statistical metrics includes terms such as Open Rate, Click-Through Rate (CTR), Bounce Bank rate and so forth.  Open Rate is the total number of emails opened in HTML format divided by total of emails delivered or distributed.  Click-Thru Rate (CTR) is the number of clicks on links in the email divided by the number of emails opened and indicates how many people interact with your e-mail.  Bounce rate is the total number of e-mails not delivered and bounced back to the sender which means the e-mail is blocked.

The three metrics involve measures the success of e-mails.   It is up to the company to measure all or one or two of these.  Making the subject line attractive will often get the reader to open the e-mail, but this is not overdone because it can look like spam.  Stay clear of using words like 30 day free offer which appears as spam-like material. (Giardi,I).   Log analysis tools will also provide important feedback and is used to measure the results of an e-mail campaign.  They include number of emails broadcasted and opened, number of clicks which include embedded links, and the number of e-mail addresses that bounch back and why.  (Hamilton, L.)

A new web presence can develop a new presence in the market place.  A website can help define the project and programs,  and show target audiences.  It also can define important goals and decide future projects.  Websites are studied  for presentation of ideas including, logos, layout, and photos.  Types of viewers of the website will also be measured.  The more one knows about our customers the more success a business will have.  (Hamilton, L).

A business may emphasize branding metrics to help make its brand known in the market place, and its campaigns will be base on brand awareness metrics. The brand marketer wants to help create an experience about brand on the website.  Metrics differentiate between the clicks and which ones are important.  Marco Derksen has developed a type of branding metrics called BEI (pronounced “buy”) or Branding Effectiveness Matrix and is useful in comparing campaign results.  In this instance a company will  use and measure  its new brand and the brand’s impact.  This is part of the behavioral  mapping strategy.

A visitor interacts with a brand on a web site and what the viewer’s positive or negative impression is measured.  These results are subject to change as the viewer visits the website.  Improvements are made  until the site can offer the user a positive experience.  So how does this work?  The site does the branding and replaces a  measurement of brand effectiveness.  This is done by using BEI methods such as page views, information request, and newsletter subscriptions which is used quite frequently today.  One company that uses BEI is Chevrolet which has a brochure request, a dealer locator, or a “Contact Us” form.  McDonalds uses a restaurant locator site, and a visit to the “Treasure Planet Happy Meal Site”.  (Derksen, M.) To put it quite simply websites impact brands.

To find a return on its investments, metrics justifies its marketing budget and can determine which marketing activities are better suited over others.  It is good to know how a business’ spends its marketing budget.   What is the cost for coupons, direct mail or media options?  To increase profit at lower risk the following is employed and includes agent base modeling taken from the Professional Marketing Development Workshop on Measuring and Improving Marketing Effectiveness:

  • Agent-Based Modeling – A bottoms up model of the consumer including choice, segmentation, equity and competitive differentiation
  • Marketing Mix Modeling – A statistical approach deriving ROMI coefficients between marketing drivers and consumer/customer response
  • System Dynamics – A top down approach to determine relationships along the purchase funnel
  • Conjoint Analysis/Discrete Choice Modeling – A consumer oriented approach based on how consumers make choices between product features, brands and price

It is important to track Return on Investment data because this is a way to gain qualitative facts and discuss improvements.

A  metrics system will be established, and use the findings to open new stores, after making sure the stores are stocked with the right merchandise to   synchronize with the right marketing plan.  A business will set up sales goals and establish  locations with new customers.  This in turn provides a chance for  greater revenue, and leads to greater success.    Sales volume is tracked to decide what opportunities are available for more sales.  Looking at its past performances,  a business will find out what consumers need or if these needs have not been met.

Looking at industry standards is also helpful  as well as past performances because it needs to improve in branding.   Matt Plaskoff of Plaskoff Construction states that he uses the following to improve on his sales:  “We set up our scorecard to show our plan and forecast based on how many days we are into our month and how many leads or prospects we have generated. We track our ratio of bids (or prospects) so we can make sure the tool we are using for figuring our metrics is meeting or exceeding our plan.” He also believes in raising a sales goal if the goal for the previous month was not made to make up for any loss in sales.  (Plaskoff, M. (2003).

It is important for businesses to measure everything that needs  measuring including the overall response rate to the media, percentage of cards filled out and returned, hits on web-sites, cost to market, number of product/design registrations (which indicates future purchases of a product), net sales,  and return on investment.  (Hamilton).  Pleasing the customer is also an important avenue in regards to customer relationship management which helps to focus on running to the customer to fulfill their needs.  It is important to know what the customer needs.

Metrics will also include compiling geographical locations, social customs, and different types of customers who buy different types of furniture.  What will the customers buy and where are these customers located?  Marketing seeks to only forecast success and will use metrics to make that possible.


Cognos, Smart Companies Get Ready, Retrieved on 12 February 2007 from the World Wide Web:

Cognos, The Next Level of Performance, Metrics Track Your Performance, Retrieved on 12 February 2007 from the World Wide Web:

Derksen, M., (2002), Branding Metrics for Search Engine Marketing? Marketing Facts, Retrieved on 12 February 2007 from the World Wide Web:

Giardi, I., The Importance of Email Marketing Metrics, OPT Influence Permission Email Marketing & Advertising, Retrieved on 12 February 2007 from the World Wide Web:

Hamilton, L, et. al., Marketing Metrics:  Where to get them:, Advertising & Marketing Review, Retrieved on 12 February 2007 from the Colorado Technical University Website:

PMD Professional Marketing Development Series, Measuring and Improving Marketing Effectiveness, Marketing ROI and Metrics Workshop, Retrieved on 12 February 2007 from the World Wide Web:

Plaskoff, M., (2003)., Sales and Marketing Metrics, Professional Builder, Retrieved on 12 February 2007 from the World Wide Web:

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