Nothing Measured, Nothing Gained


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Take the measure of your marketing programs. Photograph by aussiegall.

How hard is it to give something away for free?

Recently, Wal-Mart announced that it’s laying off the 10,000 people it employs in the United States to give away free samples in its Sam’s Club grocery stores. Instead, product demonstrations will be outsourced to Shopper Events, a marketing company with more experience in this area.

  • Surprise #1: Wal-Mart had so many people devoted to free-product giveaways?
  • Surprise #2: According to unnamed experts quoted by the Times, “the quality of Sam’s Club store demonstrations has been inconsistent across stores, sometimes even amateurish.”

In other words, what Wal-Mart most failed to sell was itself as an effective marketing channel. That’s because most product demonstrations are trade promotions—manufacturers paying a store to highlight their wares. They want to see a return on their investment (ROI) or else they’ll take their lucrative trade promotions elsewhere.

Enter Marketing Management

Understanding which marketing campaigns work well, or don’t—in other words, to know whether your marketing dollars are better spent at Sam’s Club or its rival Costco—requires practicing the art of marketing measurement. And it’s a discipline in which many consumer product manufacturers excel.

For example, at the turn of the (20th) century, Innoveer worked on a CRM project with Reynolds Metals (now part of by Alcoa), maker of the eponymous aluminum foil. The project goal: To measure marketing resources, as well as returns, to ensure the company spent its marketing dollars wisely.

Many of those marketing dollars went to grocery stores just like Sam’s Club, because Reynolds Metals didn’t sell directly to consumers. Rather, salespeople worked with grocery stores to set up trade promotions, such as offering coupons, creating an end-of aisle display or commissioning in-store demonstrations of its products.

Thanks to that marketing measurement project, Reynolds gained the ability to measure marketing costs versus net margins. For example, say Reynolds sold $3,000 worth of products at a specific grocery store in February. After running a coupon, at a cost of $500 for printing and distribution, it saw sales rise by $5,000 for that store in March. That would be a good ROI, and a campaign that Reynolds would likely care to repeat and apply elsewhere.

Best Practices: Marketing Measurement

Based on Innoveer’s extensive marketing experience, we’ve found that to gauge marketing campaign effectiveness, you need to pursue these four marketing measurement best practices:

  • Resource Management: The process of defining, monitoring and forecasting the use of financial, capital and human resources required by marketing programs.
  • Program ROI: The measurement process of defining and monitoring program metrics—especially from the perspective of program cost versus business benefits.
  • Research & Feedback: Formal process for capturing information regarding customer awareness, behavior and attitude—including reaction to commercial programs.
  • Marketing Reporting: Analyze marketing program data and present intelligence in a format that enables both rapid and in-depth review of trends and measurements.

How Advanced Are You?

Innoveer benchmarks organizations’ marketing strategies to determine any given organization’s relative process maturity in that area—namely, whether it’s advanced, lagging, or somewhere in between. Here’s how that spectrum looks for the best practice of resource management:

  • Initiating: Generating some cost estimates for programs, when required.
  • Competitive: Defining and approving programs in advance, and estimating cost and resource requirements.
  • World Class: Planning and automatically monitoring resource allocation and utilization, tied to campaign activity volume.

Fix Faults First

Want to know which marketing capabilities to improve? Benchmark your current marketing program. Benchmarking will show the areas in where you’re relatively ahead or behind. To get the biggest project ROI, first focus on making your weak capabilities stronger. This will lead to the biggest improvement in the overall effectiveness of your marketing program.

Learn More

Learn the five requirements for creating more effective marketing programs: event management, marketing strategy, lead management, campaign management as well as marketing measurement.

Beyond mastering marketing and sales, organizations like Sam’s Club also succeed or fail based on the quality of their membership experience. For more on member-centric best practices, read Innoveer’s Q&A with The Lawn Tennis Association.

Republished with author's permission from original post.

Adam Honig
Adam is the Co-Founder and CEO of Spiro Technologies. He is a recognized thought-leader in sales process and effectiveness, and has previously co-founded three successful technology companies: Innoveer Solutions, C-Bridge, and Open Environment. He is best known for speaking at various conferences including Dreamforce, for pioneering the 'No Jerks' hiring model, and for flying his drone while traveling the world.


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