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Measurement calls for more resources

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While marketing performance measurement is a high priority for marketers, many companies are still not investing heavily in the people, technology and processes necessary to handle the increasing amounts of data and analysis for MPM.

Several recent studies indicate the high priority that marketers are placing on marketing measurement and analytics.

Last week, the Association of National Advertisers released a study that found accountability is the No. 1 priority for senior marketing executives.

In December, the Chief Marketing Officer Council issued a report that found the most urgent development priority of CMOs is to improve their marketing analytics capability.

And in March, consulting firm VisionEdge Marketing released a survey that found while 54% of companies said measuring marketing performance is one of their top three priorities, a whopping 86% said they are dissatisfied with their current state of marketing performance tracking.

One of the problems is staffing for marketing measurement. According to a survey by WebTrends, only 9.7% of companies have multiple full-time employees dedicated to Web marketing analysis. The rest have a single employee dedicated to analysis, spread it out as a part-time function or outsource it.

Sybase, a database software company, does not have a dedicated staff for measuring marketing performance. Therefore, it has had to come up with creative, cost-effective ways to handle the task.

"I have two things I am required to measure programs on—awareness and lead conversion," said Holly Rollo, director of corporate marketing at Sybase.

"In lieu of having a dedicated person for measuring programs and conducting research, we build in research activities around our campaigns."

Rollo said Sybase works with publishing partners that can bring research and tracking resources to bear in measuring awareness for specific campaigns.

For example, last year Sybase partnered with CIO magazine on a campaign to drive awareness and consideration of Sybase as an enterprise mobility leader.

As part of the partnership, CIO provided creative online execution, guaranteed leads, custom content, event support, reporting and optimization.

Be clear on goals

Rollo said one of the important things in working with a publishing partner on research is to be clear on goals and metrics before the campaign is launched.

"If you're trusting the publisher to structure research in a certain way, such as how are we moving the needle on consideration, you have to customize that set of questions and push them to ask the right questions," she said.

To track lead conversion, Sybase recently installed Salesforce.com software. It is also in the early process of developing marketing dashboards across the organization. "These things are hard to do and they take time," Rollo said.

Michael Gerard, research director of IDC's CMO Advisory Research practice, said technology companies are beginning to invest more in resources for MPM, including people, processes and technology.

"The rise of the marketing operations function is indicative that companies are investing in marketing performance measurement," he said.

According to IDC's "CMO Tech Marketing Benchmark" study released in August, 72% of technology companies have a marketing operations role responsible for measuring marketing performance in place at their organizations.

The study also found that in the next 12 months, 38% of companies plan to deploy marketing measurement processes, 19% plan to deploy MPM systems and 12% plan to expand the marketing operations role or team.

One company that has invested in MPM people, processes and systems is Postini Inc., which provides electronic messaging management for corporations.

"For a company the size of Postini, which is relatively small, it is kind of unusual to have a dedicated marketing measurement function," said Drew Paik, director of marketing operations for the company. His department has four people who are dedicated to measuring marketing performance.

"In a small company, marketing measurement is even more important," Paik said. "You are not generating 30,000 leads a month, you are generating a few thousand; and each lead is very valuable."

Postini uses Salesforce.com software for CRM, Eloqua Corp. for demand generation and RingLead Inc. to clean and update its marketing data.

However, Paik said, "We have certain limitations with the tools at hand. Our CRM systems can only do so much, and sometimes we have to combine data from the different systems and make it all make sense."

To handle the data crunch, one group is dedicated to lead generation, another is dedicated to sales and a third makes sure leads get to the right people.

"It's not enough to just have the best technology. Often it is much more important to execute well," Paik said.

Laura Patterson, president-CEO of VisionEdge Marketing, said, "One of the biggest problems [with measurement] is that companies don't have good processes for tracking metrics."

Priority/process gap

According to the VisionEdge survey of 126 marketing executives, there is a gap between what companies identify as marketing priorities and the actual processes in place to track those goals.

For example, 71% of companies said a priority this year is increasing share in existing markets, but only 50% have a process in place to track this.

Also, 47% of companies said increasing brand value is a priority, but only 19% have a process to track this; and 39% said increasing share of business with existing customers is a priority, but only 9% have a process to track this goal.

The VisionEdge survey also asked marketers which metrics they are expected to measure and if they have processes in place to track them.

It found that 48% are expected to measure ROI on individual campaigns but don't have a process for doing this, compared with only 9% of companies that are expected to measure ROI on individual campaigns and have a process to do this. The remaining 43% are not expected to measure ROI on campaigns.

Also, 24% of companies are expected to measure awareness and have a process in place to do so, and 24% are expected to measure awareness but don't have a process in place; the remaining 52% are not expected to track awareness.

The survey also found that 72% of companies are not expected to measure the value of the overall customer base, and 76% are not expected to track share of customers' wallet.

"We believe share of wallet is a critical metric for customer lifetime value," Patterson said. "It's surprising how few companies are looking at this."

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