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7 Mistakes You’ll Make in Marketing Performance

CMO bud­gets are decreas­ing, as mar­keters strug­gle with fis­cal matu­ri­ty, accord­ing to Gart­ner. With greater scruti­ny over their invest­ment than ever before, CMOs have to under­stand what is work­ing, what is not, and where to spend their next dol­lar to con­tin­ue to opti­mize their impact on the busi­ness. Enter Mar­ket­ing Per­for­mance Man­age­ment (MPM).

What is Marketing Performance Management?

MPM is a com­bi­na­tion of process­es, tech­nolo­gies, and actions used by mar­ket­ing orga­ni­za­tions to plan mar­ket­ing activ­i­ties, eval­u­ate results against estab­lished goals, and make more impact­ful deci­sions.

How­ev­er, today, only 21% of com­pa­nies have the capa­bil­i­ty to ful­ly under­stand Marketing’s con­tri­bu­tion to rev­enue, accord­ing to Allocadia’s 2017 Mar­ket­ing Per­for­mance Matu­ri­ty Bench­mark Study. This research dug deep into the prob­lem in qual­i­ta­tive con­ver­sa­tions with lead­ing CMOs as well as a broad quan­ti­ta­tive sur­vey.

Four Success Factors of High-Performing Marketers

Over­all, while the indus­try still has much work to do to improve the adop­tion and matu­ri­ty of MPM, there are lead­ing orga­ni­za­tions who are set­ting a stan­dard for their peers.

We found a num­ber of shared suc­cess fac­tors for these high-per­form­ing mar­keters:

  • A strong focus on core oper­a­tional data; invest­ments, returns, and strate­gic views of data such as ROI.
  • Con­sis­tent use of tech­nolo­gies glob­al­ly, and inte­gra­tion between all parts of their tech stack.
  • Metic­u­lous­ly clean data sources.
  • Mea­sure­ment that proves their val­ue to the busi­ness and its goals.

The study also uncov­ered sev­en key mis­takes orga­ni­za­tions are mak­ing as it relates to MPM:

  1. Severe­ly out­dat­ed tech­nol­o­gy – Sales teams rely on the inno­va­tion of mod­ern CRM sys­tems. Finance has been man­aged by ERP sys­tems for years. How­ev­er, the 80% of orga­ni­za­tions are still using Excel in some way to track Marketing’s impact on the busi­ness. Our study found that 47% of orga­ni­za­tions are not using any pur­pose-built tech­nol­o­gy at all when it comes to plan­ning or invest­ment man­age­ment (core activ­i­ties of Mar­ket­ing Per­for­mance Management).In con­trast, high-growth orga­ni­za­tions lever­age Mar­ket­ing Per­for­mance Man­age­ment soft­ware 3.5X more often than those with flat or neg­a­tive growth.
  2. Mar­ket­ing mea­sure­ments that are sim­ply not action­able – Our study found that only 6% of mar­keters feel that their mea­sure­ments help deter­mine the next best mar­ket­ing action. That leaves 94% of those in our study with­out pre­scrip­tive guid­ance on where to spend their lim­it­ed bud­get and resources.The attrib­ut­es of MPM sharply con­trast to those of mar­ket­ing mea­sure­ment. If B2B mar­ket­ing mea­sure­ment rep­re­sents what a dri­ver sees in a car’s rearview mir­ror, then MPM serves as the head­lights and the steer­ing wheel of the car itself that improve both vis­i­bil­i­ty and con­trol for the dri­ver. Alli­son Snow, Senior Research Ana­lyst, For­rester
  3. Mis­align­ment between Mar­ket­ing and the busi­ness – Com­pa­nies expect­ing more than 25% rev­enue growth are twice as like­ly to have CMO-lev­el reports show­ing Marketing’s con­tri­bu­tion to the busi­ness. These high-growth busi­ness­es are near­ly 2.5X more like­ly than under­per­form­ing orga­ni­za­tions to see both mar­ket­ing and sales data always or often aligned to the company’s over­all objec­tives. That means lead­ers in MPM have rev­enue func­tions of the busi­ness work­ing in lock-step with com­pa­ny objec­tives.
  4. CFO and CMO rela­tion­ship trou­bles – The best orga­ni­za­tions in our study were 3X more like­ly to align the func­tions of Mar­ket­ing and Finance. How­ev­er, only 14% of mar­ket­ing orga­ni­za­tions over­all saw Finance as a trust­ed strate­gic part­ner, and 28% either have no rela­tion­ship with finance or speak only when forced to. This is immense­ly dan­ger­ous as Mar­ket­ing works to secure appro­pri­ate bud­gets, and it lim­its the per­cep­tion of Mar­ket­ing as a strate­gic part of the busi­ness. The trust of a CFO is crit­i­cal to today’s CMOs.In con­trast to low-per­form­ers, our study found that high-growth orga­ni­za­tions work with Finance to track invest­ments and mea­sure­ments (57% com­pared to 20% of com­pa­nies with flat/negative growth). They are also more apt to align with Finance on the mea­sure­ments of bud­gets and returns (61% com­pared to only 27% of com­pa­nies expe­ri­enc­ing flat or neg­a­tive growth.)
  5. Poor invest­ment, bud­get­ing, and plan­ning data qual­i­ty – Data qual­i­ty (relat­ed to invest­ments, bud­gets, and plan­ning) is a com­mon chal­lenge among orga­ni­za­tions, which lim­its report­ing and the abil­i­ty to make bet­ter mar­ket­ing decisions.Only 8% of orga­ni­za­tions have mar­ket­ing, sales and finance data in one data ware­house that acts as a “sin­gle source of truth.” and only 28% feel marketing’s data is account­ed for and well for­mat­ted (this includes that ini­tial 8%).
  6. Lack of vis­i­bil­i­ty into base­line met­rics – Only 50% of orga­ni­za­tions report hav­ing full vis­i­bil­i­ty, or bet­ter, into base­line mar­ket­ing met­rics. 13% of those report­ed that they don’t even know where all their data lives and can’t run any reports. Ouch.
  7. Incon­sis­tent use of MarTech – Com­pa­nies who con­sis­tent­ly inte­grate tech­nol­o­gy across their entire mar­ket­ing orga­ni­za­tion are 5X as like­ly to see 25%+ rev­enue growth than those with flat or neg­a­tive growth (57% vs. 13%).What’s more, con­sis­tent use of mar­ket­ing tech­nol­o­gy (e.g. the same mar­ket­ing automa­tion plat­form rather than three dif­fer­ent ven­dors across the orga­ni­za­tion) makes a dif­fer­ence. About 60% of com­pa­nies who expect bud­get increas­es over 10% report their use of mar­ket­ing tech­nol­o­gy across the orga­ni­za­tions to be always or often con­sis­tent, com­pared to 36% of those with flat to neg­a­tive growth.Finally, 70% of com­pa­nies that expect rev­enue increas­es have good or excel­lent clar­i­ty of their mar­ket­ing tech­nol­o­gy roadmap, ver­sus 27% of those with flat to neg­a­tive growth expec­ta­tions.

MPM Matters To Every CMO

Mar­ket­ing must now look at their orga­ni­za­tion more like a busi­ness, not sim­ply a func­tion. They must make every dol­lar count to max­i­mize their team’s per­for­mance and prove their impact.

CEOs expect that CMOs can eas­i­ly ana­lyze exact­ly how mar­ket­ing is con­tribut­ing to the bot­tom line. When CMOs have access to data, every­thing changes. Look­er CMO Jen Grant, in a recent inter­view with CMO.com


By | 2017-12-27T07:06:31+00:00 December 31st, 2017|Industry News|Comments Off on 7 Mistakes You’ll Make in Marketing Performance