Marketing Effectiveness and Accountability: It Can’t Happen Without You

According to a February 2015 study by Duke University’s Fuqua School of Business, commissioned by the American Marketing Association and McKinsey & Company, the annual marketing spend as a percentage of company revenues ranges between 7.4%-9.3% of revenue, with employee-related costs accounting for around 40% of the budget. It’s completely reasonable that as the CEO you expect your marketers to demonstrate the value of the investment they are making on behalf of the company.

Our own 2015 marketing performance measurement study, found that typically it’s not the budget that holds marketing back from being able to prove its value.  The real difference is alignment. When marketing isn’t aligned to the leadership’s priorities, it isn’t able to directly contribute to the business. Our research of hundreds of companies of all sizes and in all industries around the world has consistently found that less than 20% of marketers earn high marks from the C-Suite (CXO) for their ability to prove Marketing’s contribution and impact.  While this small group of marketers (value creators) continues to make headway on alignment, the majority of marketers continue to struggle.


(Persona Definitions based on 14 years of research:  Campaign Producers view their primary  responsibility is to create and implement “programs”; Sales Enablers view their primary responsibility is to service the sales team and generate “leads”; Value Creators view their primary responsibility to strategically facilitate organic growth by developing and investing in measurable customer-centric initiatives aligned with the organization’s priorities.)

When your marketers are aligned they have the ability to contribute to the business goals, when they aren’t, well, they can’t.


What can you do to help your marketers improve their effectiveness and accountability?  Here are three things you need to do:

  1. Demand that all marketing activities and costs be synchronized with business outcomes. This is the first step in ensuring alignment.
  2. Require that this alignment process be incorporated into the marketing planning and budgeting process. Refrain from approving marketing budgets that are orphaned from the plan.
  3. Make sure your marketers have the right skills, infrastructure and performance management systems in place. Often this third step entails addressing training, infrastructure, and benchmarking.  Here’s how each of these will help your markets excel at marketing.

Invest in Your People

Lack of training is one of the biggest reason marketers struggle to move from measuring metrics to measuring performance.  Once again, this year’s study revealed that accessing analytical skills remains one of the top three challenges marketers face. An Omniture study indicated that many marketers lack the training and support they need to develop the analytical skills needed in today’s data-driven environment.

Invest in Your Infrastructure 

Let’s say you have the analytical talent.  The next potential hurdle is being able to quickly translate insights from analytical systems into marketing decisions and then use operational systems to execute on these decisions.  The challenge is that often these insights are derived from various disparate data sources that house various types of customer data – such as customer profile information and segment data, customer transaction history, and communication history along with lead scoring models.  Top that off with the need to append external data related to the market and competitors.

And all this data probably requires systems that can recognize the same customer/prospect across different channels and the ability to access and update information in real time. Real-time and near real-time updates alone require fundamental changes in how marketing databases are designed, managed and analyzed. Organizations often need to be able to revise business rules and execute analytics and update models as quickly as new data becomes available.  All of this explains why the entire marketing infrastructure is increasing in complexity at the same time that speed has become a dominant requirement. As a result, marketing systems and processes need capabilities an order of magnitude better than what most marketing organizations are using today.  Improving marketing effectiveness will take revisiting and investing in the marketing infrastructure.

Invest in Benchmarking

A benchmark is defined as the standard by which all items of similar nature can be compared or assessed. Benchmarking is a self-improvement tool. It allows you to compare yourself with others, to identify areas of comparative strengths and weaknesses and learn how to improve.  Robert Camp who published the first book on benchmarking suggests that by using benchmarking to identify and replicate “best practices,” a company can enhance its business performance. We need benchmarks to know what, and by how much, we need to improve. Yet, according to our annual MPM study, only about 60% of the value creators perform any benchmarking, and only 35%-44% of the rest of the pack employ benchmarking.

If improving your marketing performance is important to your organization, then it’s time to invest in benchmarking.

In a matter of months many marketing organizations will begin to work on their next fiscal year plan and budget.  Now is the time to take stock of your talent, infrastructure, and how you stack up against peers and best-in-class performers so that next year your marketers will have the ability to show the value of the investments they are making on behalf of the company. Learn more about benchmarking and performance management audits.