What are marketing metrics?
There is a classic saying, “you can’t manage what you can’t measure”, so when it comes to marketing how do we measure our success or failure of various marketing campaigns. The best way to measure marketing performance is with the use of marketing metrics. But what exactly are marketing metrics? Marketing metrics are specific set of measures that are used by marketing professionals to compare, quantify and interpret marketing performance. One of the main reasons marketers need to use these types of measures is to prove their worth to various stakeholders as marketing is seen as an expense rather than an investment … but as another classic saying states “you’ve got to spend money to make money.” An article by Tim Ambler and John Roberts states that companies should avoid only using one financial measure the “silver metric” and should use multiple measure to assess marketing performance.
So what are the different types of marketing metrics that we can use to assess marketing performance?
- Memory metrics – looks at brand awareness, brand image associations, mental availability, attitude, customer satisfaction, intention to buy and recommendation
- Behavioural metrics – looks at sales, market share, market penetration, purchase frequency and share of category requirements
- Financial metrics – looks at various measures such as profit contribution, profit margin, return on investment and customer value.
- Customer profile metrics – looks at various things such as age, gender, income this kind of information is useful for marketers to understand more about customers
- Physical availability metrics – looks at how easy and readily available products are to buy and consume. This particular metric can be measured in many ways such are distribution, opening hours, number of displays in a store and geographical coverage
These various metrics help marketers accurately assess their marketing performance and can be used to help future marketing strategies.
Loyalty programs have been used for years and years, the benefits of providing loyalty programs are, to attract new customers, to increase the amount of money that customers are spending and to retain customer.
One of Australia’s most popular programs is Flybuys. With many participating partners such as Coles, Kmart, Target and Liquor land. Customers can swipe their Flybuys card at various retailers around Australia earning points and rewards with the money spent and goods purchased at these various stores. Customers are able to earn points with other Coles products such as insurance and credit cards. But other than being a great incentive for customers what good is a loyalty program such as Flybuys for everyone else?
For starters these kinds of loyalty programs collect huge amounts of customer data that can be used by marketers. By swiping your loyalty card with every transaction at various participating stores marketers are able to track everything that customers are purchasing and therefore they are able to market particular offers and products to the right people … for instance their would be no point in marketing baby care products to elderly customers with no young children, this would just be a waste of marketing money and resources. By being able to use and collect this data marketers are also able to assess consumer behaviour and customer profiles. Marketers can also use these loyalty programs to request feedback from customers about their experience in particular store and feedback on particular products.
Loyalty programs like Flybuys are a great asset to companies, research has shown that food retailers have found that 65 per cent to 95 per cent of their sales go to members of these various loyalty programs, and that the greatest value of these programs is being able to identify individual customers and also identify their individual behaviour. This benefit of a loyalty will no doubt out way the cost of providing such a service, especially as consumer behaviour can be so mind boggling to many marketers out there.
It is fair to say that loyalty programs can provide marketers with plenty of information about their marketing performance, these particular data bases can tell marketers so much about how the company is performing and provide vast amounts of insight to consumer behaviour.
Eleanor Wilson #210669831
Ambler, T, Roberts, JH, 2008 Assessing marketing performance: Don’t settle for a silver metric Journal of Marketing Management, vol.24, 733-750
Coles, 2016, Collect Points, Coles, 26th September 2016, <https://www.flybuys.com.au/collect/#/>
CRM Trends, 2016, Loyalty Programs, CRM Trends, 26th September 2016, <http://www.crmtrends.com/loyalty.html>