increasing marketing’s relevance to the business
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Note: This Abbreviated Summary highlights some of the significant findings from 2013 ITSMA/VEM/Forrester Marketing Performance Management Survey:
Increasing Marketing’s Relevance to the Business A more in-depth analysis can be found in the full report available for purchase at:
http://www.itsma.com/2013-marketing-performance-management-survey-summary/
Abbreviated Summary | June 2013
Increasing Marketing’s Relevance to the Business
2013 ITSMA/VEM/Forrester Marketing Performance Management Survey
Matt Kerwick, PhD, Senior Analyst, VisionEdge Marketing
Dianne Kim, Research Associate, ITSMA
Laura Patterson, President, VisionEdge Marketing
Laura Ramos, Vice President, Principal Analyst Serving CMOs, Forrester
Julie Schwartz, Senior Vice President, Research and Thought Leadership, ITSMA
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Key Takeaways The Situation Only a handful of senior executives are relying
on marketing data to make decisions.
Furthermore, more than half of marketers are
not confident that they know which metrics and
outcomes its key stakeholders care about.
What’s going on?
Marketers are reporting:
1. Marketing activity, not business outcomes
2. Operational efficiency, not effectiveness
3. Past performance, not predictive insight
The Solution
To capture the C-suite’s attention, marketers
need to create a clear line of sight between
marketing activities with business outcomes.
The best-in-class marketers:
• Speak the language of the business
• Understand how the business leaders
evaluate marketing effectiveness
• Connect marketing activities to
business results
• Produce actionable marketing dashboards
• Present marketing’s dashboard to the
executive team
• Use data and analytics to report past
history and as a predictive tool
• Employ analytics talent
• Invest in analytical tools
• Build analytical models
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Remarkably, just 40% of marketers today believe that measuring marketing’s value and contribution to the business is very important or critical
In your organization or
company, how
important is it that
marketing is able to
measure its value and
contribution to the
business? Mean Rating (N~396)
.
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
Very
Important
or Critical
40%
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
And only a handful of senior executives are relying on marketing data to make decisions
To what extent are
your key stakeholders
using the data,
metrics, and/or
analyses
developed by
marketing? % of Respondents
(N~383)
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
Relies on
marketing data to
make decisions
BU or Division Leaders
CEO
16
13
9
Sales
CFO/Finance 6
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
9
12
24
18
12
10
6
5
2
2
Extremely Confident = 10
9
8
7
6
5
4
3
2
Not at all Confident = 1
55%
Most marketers don’t know which metrics and outcomes its key stakeholders care about How confident are you that you know which metrics/business outcomes your
key stakeholders (e.g., CEO/CFO/BU leaders) care about? Mean Rating (N=394)
Note: Mean Rating based on a 10-point scale where 1=Not at all confident and 10=Extremely confident.
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
Mean Rating=6.8
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Marketers are reporting on marketing activity and associated costs, rather than reporting on metrics executives use to set direction Which performance metric categories are included on marketing’s dashboard? % of Respondents (N=163)
Note: Multiple responses allowed.
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
77
62
53
44
33
31
24
21
19
18
6
Sales pipeline (leads, conversion rates, win rates)
Marketing spend
ROI (e.g., campaign ROI, event ROI, lead ROI)
Brand awareness/equity
Customer satisfaction/loyalty
On-time delivery of marketing programs
Marketing contribution to customer retention/loyalty
Marketing contribution to market share
Marketing contribution to category ownership
Other
Marketing
Activity
and
Efficiency
Business
Outcomes
Marketing contribution to customer
penetration/expansion/share of wallet
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Most marketers use data and analytics to report on past performance rather than provide predictive insight
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
Are data and analytics being used as a predictive tool
or to report past performance? % of Respondents (N=342)
To report past
performance
As a predictive
tool
Not applicable,
we don’t use
analytics
11%
25%
64%
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
A few exceptional marketers are able to demonstrate value and contribution to the business
90–100:
Marketing was able to measure
and report the contribution of its
programs to the business
80–89:
Marketing programs made a
difference but the contribution to
the business goals were not
measured and reported
70–79:
Marketing appears to have made
some impact on the business, but
it is not clear if the impact was
material, nor is it measured
69 or
lower:
Marketing programs didn’t make a
difference—there is no clarity as
to how marketing is contributing
to the business
For 2012, using a 100 point scale, please select what grade the CEO (or you, if
you are the CEO) would give your marketing organization for its ability to
demonstrate its value and contribution to the business. % of Respondents (N=424)
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
27%
38%
29%
6%
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
The “A” marketers align their marketing activities to business metrics that executives care about
Speak the
language of the
business
Understand how
the business
leaders evaluate
marketing
effectiveness
Connect
marketing
activities to
business results Output-
Based
Operational
Outcome-
Based
Leading
Indicators
Predictive
Media Mentions
Trade Show Leads
Click Through Rates
Lead/Rep
Lead Aging
Campaign ROI
Market Share
Category Ownership
Lifetime Value
Share of Wallet
Rate of Growth: Market
Share of Preference
Campaign Lift Modeling
Predisposition to Purchase
Likelihood to Defect
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Produce actionable
marketing dashboards
Present marketing’s
dashboard to the
executive team
“A” marketers establish clear data chains between marketing activities, objectives, and business outcomes to produce actionable dashboards
Business
Outcomes
Marketing
Objectives
Marketing
Programs
Marketing
Tactics
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
“A” marketers use analytics to inform future decisions
Use data and
analytics to report
past history
and as a
predictive tool
Employ analytics
talent
Invest in
analytical tools
Build analytical
models
How well does your marketing organization use
data and analytics to enable the following?
Mean Rating
7.5ab
7.0ab
6.0ab
6.3a
5.7a
4.7a
5.7b
5.0b
4.2b
Make tactical
marketing
recommendations
Make strategic
business
recommendations
Predict customer/
market behavior
The “A’s” (N=76)
Middle ofthe Pack(N=105)
Laggards(N=101)
Note: Mean Rating based on a 10-point scale where 1=Poorly and 10=Extremely well. ab indicate a statistically significant difference.
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
Web-based Survey
Survey invitations were
emailed during March
and April 2013 to the
ITSMA, VEM, and
Forrester communities.
In addition, survey
invitations were
extended via social
media outlets such as
Twitter and LinkedIn.
424 people completed
the survey
The Data Was
Analyzed by:
•A’s: Marketing
demonstrates contribution
to the business (Grade: A)
• Middle of the Pack:
Marketing makes a
difference, but
contribution not measured
(Grade: B)
• Laggards: Marketing may
have an impact, but not
known if impact is
material
(Grade: C/D)
Marketing
Performance
Grade
Study Methodology
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Type of Company % of Respondents (N=424)
43%
36%
21%
Primarily sell
services
Sell both
products and
services
Size of Company % of Respondents (N=424)
Industry Subsector % of Respondents (N=424)
Primarily sell
products
Manager
Director
Member of the
functional or LOB
leadership team
Individual contributor
34
6 7
4
16
8
25
Lessthan
$50M
$50Mup to$99M
$100Mup to
$499M
$500Mup to
$999M
$1Bup to$4.9B
$5Bup to$9.9B
$10Bor
more
Software solutions
IT professional services/consulting
Telecommunications and network systems and solutions
Computer systems and solutions
Marketing services/ advertising agency
Management consulting
Other services
Other product manufacturing
Other technology hardware systems and solutions
Outsourcing
Architecture/engineering/ construction
Other
20
17
12
9
6
5
5
4
3
3
3
13
34%
29%
28%
9%
Source: ITSMA/VEM/Forrester Marketing Performance Management Survey, May 2013
Study Methodology Respondent Titles % of
Respondents
(N=294)
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
Table of Contents for 2013 MPM Survey
For More Information Julie Schwartz
Senior Vice President
Research and Thought Leadership
ITSMA
jschwartz@itsma.com | +1-407-788-8220
www.itsma.com
Increasing Marketing’s
Study Buy the Member: $295
Non-member: $495
Laura Patterson
President
VisionEdge Marketing
laurap@visionedgemarketing.com
+1-512-681-8800, Ext. 12
www.visionedgemarketing.com
Laura Ramos
Vice President
Principal Analyst Serving CMOs
Forrester
lramos@forrester.com | +1-650-581-3812
Slide
Executive Summary 3
Methodology and Respondent Demographics 30
Detailed Findings 43
Marketing Performance Management 43
Data and Analytics 64
Dashboards and Models 90
Business Outcome and Sales Metrics
Performance 110
Appendix: Study Definitions 117
Relevance to the Business
©ITSMA/VEM/Forrester 2013 Marketing Performance Management Survey. All rights reserved. Not for reproduction or redistribution without permission.
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