Hear from Fortune 500 brands that have been forced to pivot as consumer preferences evolve, as well as entrepreneurs building brands from scratch to meet new consumer needs. This event peels apart the layers of brand building with a carefully crafted roster of top marketing, technology, and creative leaders.Learn more
A new study shows how marketers are changing their approach to measuring the customer experience. Now, the top metrics being used to measure experience are tied to real business outcomes -- not clicks or views -- according to a study being released today by the CMO Council.
The report, "Making Personalization Possible," was based on a study of 179 b-to-c and b-to-b marketers. It was conducted by the CMO Council and Microsoft.
In one of the key findings, the top metrics being used by marketers to measure customer experience successes are directly tied to business outcomes. The No. 1 metric is retention-rate improvement (cited by 69% of respondents), and No. 2 is acquisition-rate improvement (62%).
Clicks, views and open rates are being used by 59% of marketers to measure customer experience, while other metrics include customer lifetime value (53%), upsell and cross-sell engagements (53%), and revenue-per-transaction increases (49%).
"We are finally beginning to see a crack in 'campaign brain' for marketers," said Liz Miller, senior VP-marketing at the CMO Council.
"For such a long time, every time we asked marketers 'How are you measuring the impact and value of your marketing campaigns?" clicks and views were the No. 1 answer," she said. "This is the first time we are seeing real business metrics top the list of how marketers are defining value in personalization and campaigns that are being driven by that."
However, despite this shift to using more business-outcome metrics, only 10% of marketers said they are doing "extremely well" in measuring the customer experience and tying everything to the business outcome.
Nearly a quarter (24%) said they are doing "moderately well" at this; 40% said they are slowly evolving and are putting new metrics in place to measure the impact on business; 17% said they are doing "not well" and are still focused on campaign metrics to prove ROI; and 9% are "struggling to quantify results."
"We have kind of created our own nightmare," Ms. Miller said. "As marketers started these types of campaigns, they started by measuring impact and value in terms of clicks and likes. Now, they have had to go back and try to figure out how to measure all campaigns and data systems they have invested in to measure them in the language of the business."
Nearly half (49%) of marketers said they are "hopefully optimistic" that creating omni-channel, personalized experiences for customers will have a positive impact on business results. Just over one-quarter (26%) are "hopefully optimistic" about personalization; 17% are "waiting to see;" and 8% are "not expecting a miracle."
"Personalization is great when looking at marketing data, but we really need to be looking at service and support, finance and operations data," Ms. Miller said. "It's very hard for marketers to break the wall between marketing and finance data. There is still more conversation that needs to happen between the CMO and CFO."