Seven Steps for Identifying the Right Marketing Metrics
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FI Marketers Need Proven Metrics to Justify Budgets & Value
WHITE PAPER | Seven Steps for Identifying the Right Marketing Metrics
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Gone are the days when marketing gauged its worth by the volume of ads,
marketing materials and promotional content it pumped into the sales
stream. These days, if you want a reasonable marketing budget, you’ll have
to prove you deserve it.
CFOs and CEOs expect quantifiable evidence that your efforts support the
KPIs of the institution, and that they yield a respectable ROI. If marketers
cannot make this case, the marketing function will forever be considered an
overhead expense, rather than a powerful cylinder in the revenue engine.
The problem is, most marketers don’t believe they have the information
they need to build a business case that conveys their value and justifies
their budget.
In a 2013 study by The Financial Brand, only 15 percent of bank and credit
union marketers said they have a good idea how much value they get for
their marketing investment. A mere six percent considered themselves very
sophisticated with their marketing measurements. The bulk of marketers
struggled or relied on guesswork.
The Financial Brand Marketing Survey. 2013
FINANCIAL BRAND MARKETING SURVEY
15% WE HAVE A GOOD IDEA HOW MUCH WE GET FOR OUR MARKETING INVESTMENTS
10% WE HAVE EXHAUSTIVE MARKETING METRICS AND TRACK EVERYTHING WE CAN
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The Good NewsMarketing Measurement has come a long way… and is now easier
than ever.
Because of advances in technology, data-management, analytics, and
marketing providers who build measurement into every campaign, it is no
longer a burden to track marketing effectiveness against the institution’s
KPIs. Nor is it difficult to establish ROI.
Want to do a better job measuring metrics at your financial institution?
Here’s a best-practices approach to getting started.
“ I want to be able to make a business case for my budget so I am the one to set the number. Right now my marketing budget is dictated by the CEO and CFO.”
– Bank CMO
“ We have to show the CFO that there is scientific evidence and solid strategy behind our marketing decisions. That’s how we earn more C-suite credibility.”
– Deluxe MarketingServices Strategist
0.1%THE FINANCIAL BRAND RECOMMENDS A MARKETING INVESTMENT THAT IS APPROXIMATELY EQUIVALENT TO 0.1 PERCENT OF A RETAIL FINANCIAL INSTITUTION’S ASSETS.
5THE MOST MANAGEABLE NUMBER OF METRICS, ACCORDING TO BUSINESS EXPERTS.
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Step One: Embrace AccountabilityJustifying marketing’s value and budget is, at its core, an exercise in
accepting personal accountability. For most marketers, accepting
accountability for their performance means that they will:
• Establish performance metrics that directly support business KPIs
• Measure marketing strategies and tactics quantitatively
• Use relevant performance data to strive for continuous improvement
• Ensure the company’s money is spent on the right strategies and tactics
The Definitive Guide to Marketing Metrics and Analytics by Marketo, a
strategic marketing firm, suggests that denial, fear, and confusion get in the
way of accepting accountability.
THE 5 STAGES OF MARKETING
ACCOUNTABILITY
1 DENIAL “MARKETING IS AN ART, NOT A SCIENCE. IT CAN’T BE MEASURED. THE RESULTS WILL COME; TRUST ME!”
2 FEAR “WHAT IF MY MARKETING ACTIVITIES DON’T IMPACT THE BOTTOM LINE? WILL I LOSE MY JOB?”
3 CONFUSION“I KNOW I SHOULD MEASURE MARKETING RESULTS, BUT I JUST DON’T KNOW HOW.”
4 SELF-PROMOTION“HEY, COME LOOK AT ALL THESE CHARTS AND GRAPHS!”
5 ACCOUNTABILITY “REVENUE STARTS WITH MARKETING.”
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Step Two: Know What to MeasureThere are two categories of metrics that you will be expected to measure:
• Revenue metrics – These are measures that show how your marketing
efforts contribute to acquiring new accounts, selling more products and
services, and anchoring or retaining existing accounts.
• Marketing program metrics – These are measures that demonstrate the
effectiveness of your specific campaigns and tactics so you know what is
working, and what is not.
TOP FIVE MARKETING METRICS
COMMONLY USED BY FINANCIAL MARKETERS
Average balance per product
Average total margin% per
product.
Number of (active) products
per customer
Number of customers per front line FTE.
Cost per front line FTE.
$2,568 3.15% 3.6 1,578 $31,200
SourceAccounts Opened
Acquisition Cost
% of Acquisitions
Days to Close
SEM 26 $325 13.9% 7
Web Ad 9 $420 4.0% 12
Direct Mail 96 $126 51.6% 14
Radio 15 $350 8.0% 13
YouTube 7 $210 3.7% 21
Pandora 22 $98 11.8% 24
TV 11 $742 5.9% 16
1. Deposit/loan volume
2. Customer/member growth
3. Depth of relationship, share of wallet
4. Market share
5. Retention
The Financial Brand Marketing Survey. 2013
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Step Three: Gain Leadership Agreement on Revenue MetricsIt’s crucial that the CFO and CEO see that marketing is strategically
focused on the revenue goals of the institution. Once you understand your
institution’s revenue priorities and targets, you should discuss and agree
upon metrics that will measure your contribution to these growth goals. For
financial institutions, these are the most tried-and-true revenue metrics.
Number of Leads
• Inquiries or new leads –
The start of the
qualification process.
Marketing reviews
consumer data to see
whether the consumer is a
legitimate prospect.
• Qualified leads – These are
consumers who already
fit with your targeting
strategy and possibly your
propensity-to-buy model.
Number of Conversions
• Conversions – This is when
consumers move to another
phase in the customer
lifecycle and thus fall into a
new campaign category.
Conversion Time
• Velocity – Here’s where
you measure the time it
takes for qualified leads to
become account holders, or
for account holders to move
to an onboarding, cross-sell,
or loyalty phase. Typically,
the higher the velocity,
the higher the ROI of your
campaign.
Nurturing
• Not ready to buy – These
are people who aren’t
ready to buy right now,
but who would be a good
prospect later.
• Re-engagement – People
who, for whatever reason,
fell out of your sales
pipeline and need to be
included as a prospect
again.
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Step Four: Set Your NumbersWhen you know what metrics you will measure, the next step is to set goals
for each metric. This process typically involves benchmarking. To set the
right goals, it’s best to know how you are currently performing, as well as
how you have performed in the past. If you do not have access to this type
of history, your goals may have to be educated guesses based on best
practices the first time around.
— Marketing Metrics & Analytics, The Definitive GuideMarketo.com
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Step Five: Map Your Revenue MetricsMany marketing plans are represented in a spreadsheet or pages of text.
An emerging best practice is to include a flow chart or diagram of how
the strategies and tactics in the marketing plan map their way back to the
institution’s revenue goals.
Your visual aid can also help manage expectations regarding timing and
expected results. In many ways, marketing is a long-term investment. Some
campaigns will not pay dividends right away. Explain how frequently you
will measure each metric, and how you will show ongoing progress toward
goals.
DELUXE BEST PRACTICEMARKETING IS A LONG-TERM INVESTMENT, SO TRACK YOUR MARKETING REVENUE METRICS AS YOU WOULD
TRACK STOCK PERFORMANCE – AS A TREND LINE.
600
500
400
300
200
100
Q1
¢¢ 2013 ¢¢ 2014 • • • 2014 Projected
Q2
New Accounts
Q3 Q4
Step Six: Prepare the Marketing Organization to SucceedTo be able to achieve the revenue metrics established for your team, you
will need to tune up your marketing engine for optimal performance. For
example, Deluxe Marketing Services recommends that you review your
access to high quality:
• Customer demographic and behavioral data
• Analytics and predictive modeling
• Measurement and tracking technologies
• Performance reporting
• Campaign execution, including content, design and distribution
Most financial institutions outsource one or more of these capabilities. As a
best practice, outsource to a company that specialize in financial institution
marketing. These companies have a deep understanding of the relationships
consumers have with their banks and credit unions.
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CUSTOMER DEMOGRAPHIC AND BEHAVIORAL DATA
ANALYTICS AND PREDICTIVE MODELING
MEASUREMENT AND TRACKING TECHNOLOGIES
PERFORMANCE REPORTING
CAMPAIGN EXECUTION, INCLUDING CONTENT, DESIGN AND DISTRIBUTION
DATA NEEDED TOSUCCEED
Step Seven: Establish Marketing Program MetricsYes, you need another set of metrics. However, these behind-the-scenes
measurements will help your marketing organization understand what is
working – and what is not. These metrics are tools to guide your decision-
making about future campaigns and approaches.
While there are dozens of possible metrics from which to choose, the
following categories tend to surface to the top, primarily because they are
helpful in calculating campaign ROI.
Leads – Technology and automation can help you track metrics such as the
number of prospects a campaign has generated, which campaign channels
are most effective, and whether a lead was recruited or came in on its own.
Benchmarks – Comparing your work to industry averages provides insight
into how well your programs and campaigns are performing. In general, you
are trying to achieve “lift over last,” which means that your campaigns are
showing continuous improvement.
In tracking lift, most institutions try to track response rates in terms of:
• Offers accepted/coupons redeemed
• Calls to designated phone number
• Email opens & click-throughs
• Visits to web pages (URLs, PURLs, campaign landing pages)
• Time spent on web pages
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• Content downloads
• Form completions (and abandonment)
• Outbound “more information” requests from website
Social Media – Many financial institutions track social media activity
because it is easy. However, the jury is out on how the number of “Likes” on
Facebook or followers on Twitter directly supports the quest for revenue.
When it comes to social media, it may be wise to consult a specialized
marketing provider about ways to integrate trackable social media elements
into your lead-generation and product-marketing campaigns. If you go this
route, you may be able to establish truly meaningful metrics.
Data Integrity – To achieve continuous improvement in your marketing
campaigns, your data has to be fresh and accurate. Metrics that relate to
the performance of your lists can illuminate serious issues.
According to Deluxe Marketing Services, many banks choose to outsource
the data and database-management capability because of economies
of scale. Rather than purchase and maintain these immense systems on
their own, it is more cost effective to use a specialized provider who can
integrate the institution’s CRM data with their own massive data warehouse.
Specialized providers also tend to have the industry’s top experts on
analytics and modeling. They can sort through all the data elements, giving
them the proper context, and then weighting them for segmentation and
targeting. After all, if you have accurate lists, but your targeting is off, you
won’t achieve expected response rates.
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“LIKE” TO IMPRESS?STAY AWAY FROM METRICS SUCH AS NUMBER OF
LIKES, CLICKS AND DOWNLOADS. THEY MAY BE EASY TO MEASURE, BUT THEY DON’T SHOW THE CEO AND CFO
HOW YOU ARE SUPPORTING REVENUE GROWTH.
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How You Can Make the Seven Steps Even EasierEach marketing department has its own unique set of resources and
resource gaps. You may have a powerful database, but lack talented
statisticians. You may have a brilliant in-house design department, but lack
campaign management technology.
To achieve your established metrics, you will need to begin filling your gaps
right away – whether it means hiring, buying, or outsourcing.
If you would like to talk about what is right for your financial institution,
please feel free to call Deluxe Marketing Services. As full-service marketing
experts, they can help you come up with the best way to justify your value
and budget through proven metrics.
WANT MORE INFORMATION ABOUT DELUXE MARKETING SERVICES?
Contact us today.
SEARCH fi.deluxe.com/acquire/acquisition-programs/
CALL877.214.2513
Listen. Solve. Deliver.
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About DeluxeSince 1915, Deluxe has been working hard as a partner for financial institutions to
drive deeper customer engagement and more profitable revenue. As the financial
services industry has evolved, Deluxe has been an active participant in shaping it—
with the calm assurance of a company that has done it before.
Today, thanks to collaboration, innovation, and acquisition, Deluxe has an ever-
growing portfolio of retail and commercial banking FinTech solutions focused on
helping our clients manage the customer lifecycle—acquire, onboard, engage, and
operate. Our growing array of inventive, client-inspired solutions are designed to
help our clients grow in a changing, competitive landscape:
• Data and Analytics
• Digital Channels
• Marketing Services
• Performance Management
• Rewards and Loyalty
• Fraud and Risk Solutions
• Check Programs
Learn more at fi.deluxe.com Follow us on our Forward Banker blog