Performance management best practices

It used to be that marketing was approached introspectively, focusing solely on what the organization produced or delivered. Today successful organizations focus on understanding markets, consumers, and other external factors that shed a whole new light into the organization.

With the advancement of technology and communication mediums in marketing, with the large amounts of data we are now able to collect, and the evolving science of evaluating marketing performance, marketing has transformed into the most valuable tool for many fast growing businesses.

With tightening budgets, and the need for fiscal accountability on funds dedicated to projects and services, marketing measurement has yielded considerable revenue gains for those organizations that have taken advantage of this powerful practice.

According to a recent survey of over 400 organizations, those who have embraced and implemented performance management marketing techniques into their decision-making process not only have experienced greater impact on revenue, but also tend to be leaders in their respective markets. Despite this parallel, most companies fail to take advantage of this practice.

So why is it important to measure marketing performance? Because it enables your organization to measure, understand, and continuously improve your marketing efforts. And over time, with continuous marketing performance improvements, your organization will become a leader in your market, translating performance data in ways your competitors haven't begun to think about. Here are five best practices for implementing a marketing performance management system that drives high growth and simplifies decision making.

1. Gain Senior Level Buy-In

It is critical that senior level management and executives buy into a marketing strategy for performance. Studies have shown that senior level management that places value in leveraging marketing performance data into overall strategy increase their organization's chances for success. Compound this with strong marketing leadership that is able to translate the marketing strategy into action and these organizations are often able to quantify extraordinary results through marketing performance management. In a recent survey by CMG Partners, 71% of companies that are successful in marketing performance management also reported having strong senior level buy-in. Despite these convincing numbers, most did not have marketing performance management processes in place.

2. Align Performance to Business Objectives and Strategic Goals

Just as it is important for organizations to align their information technology systems to their overall strategy, it is equally important to align your marketing into your

strategy. With strategic alignment, organizations can identify which marketing strategies are successful and better understand the impact in which these strategies play into organizational objectives. Companies that excel at implementing marketing performance management strategies align their marketing strategies and measures with organizational objectives and goals.

3. Target Investments Based on Marketing Analysis

Making targeted investments in people, technology and data systems is essential to implementing a marketing performance management system that drives growth and improves decision making. Like measuring performance in other areas of the organization, the science in effectively applying marketing performance management is being able to filter out which measures are key to organizational growth among the many metrics that are out there. But in order to get the key data that drives these decisions we must first have systems in place that are capable of gathering and analyzing the data. For the many organizations that do not have these systems in place, a starting point may be to train or hire staff with the skill sets to implement an effective performance management system and develop a plan for sharing this knowledge throughout the organization.

4. Develop a Processes For Analyzing Marketing Performance and Taking Action

Just as processes and process improvement is essential to a growing organization in a rapidly changing market, implementing and managing a process for gathering, reporting and analyzing marketing performance data is essential for driving organizational growth and leveraging marketing data. When developing the processes it helps to ask the following questions "are we gathering the right information?", "are we analyzing the information completely?", "what strategies are working and why?", "how can we leverage these strategies that are working?" The most important thing is making sure that your organization is taking action on the information it currently is able to provide. I know of many organizations that have very few systems implemented, that are using marketing performance information to increase sales and sustain growth.

5. Leverage Marketing Performance Enterprise-wide

As your organization applies marketing performance management best practices and processes and begins to excel at collecting and analyzing marketing data and applying action you can extend these efforts to other areas within the organization so that you can be strong at marketing in all aspects of your organization. The majority of companies that excel with their marketing performance practices are leveraging the insights and implications beyond the marketing function. This includes improving cross-functional alignment and results in improved decision making, budgeting, and planning. In addition, many organizations are using their measures to improve the customer experience across numerous functional areas.

Since many small businesses start online, they may begin focusing on online marketing, where you maximize profits in areas that provide strong returns, measuring such things as brand perception, downloads, content preference, promotion

interest, etc. Then, as that business grows they may want to extend marketing performance management to macro level metrics, such as campaign effectiveness, customer satisfaction, market share, etc. As the organization becomes savvier at analyzing marketing performance data they may extend their focus to micro level, or action-level metrics such as task completion, marketing efficiency, process performance, decision accuracy, etc. Look for future articles describing in detail the metrics associated with marketing performance.

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