What should I measure?

I’ve been asked the question in a few different ways by clients both big and small, public and private, for profit and non-profit:

“What should I measure?”

“How do I know if my marketing is working?”

“How do we prove marketing results?”

The simple answer is sales, right?  Did your sales go up or down?  If they went up, marketing is working.  If they went down, marketing is not working.  That’s the easiest way to measure the success of your marketing efforts.  But I wouldn’t stop there.

Before anyone jumps in and starts a fight with me, I know that only measuring sales doesn’t specifically show that marketing is working.  Of course there are tons of variables at work, and that’s exactly the problem with any measurement when it comes to marketing.  There are forces out of your control that affect sales growth or decline, and there are certainly numerous other forces that you can control.

I focus on sales because that’s what matters.  Marketing exists to increase sales.  If you’re of the mindset that you want to know more, then you need to find clever ways to connect each sale to your marketing efforts without spending more time and money on the measurement than you’re making in profit.

Coupons, discount codes or promo codes are used to make this connection between a sale and marketing.  Social marketing, mobile marketing, experiential marketing and eCommerce activities are all ripe for using this approach. Loyalty programs are a similar tool.  The world of direct marketing has made this into a semi-science–call this 800#, send in this reply card, send an email to this address, visit this special website–all tools to determine what’s working and what isn’t working in terms of marketing efforts.

Never fall for the contrived marketing measurements like top-of-mind awareness and whatnot.  Just because a consumer can name your specific brand when asked to name a brand of X (chewing gum, toothpaste, toilet paper, luxury car, mattress, whatever it may be) doesn’t equate to a sale.  Building awareness is only part of the solution.

I once worked with a client whose former agency was trumpeting the fact that consumers remembered their advertising more now than 1 year prior.  How many times do you remember an ad, but completely forget what product the ad was for?  Was it Coke or Pepsi?  Was it for beer or car insurance?  The agency in this case was a former agency because sales plummeted over that 12 month period.  Oops.  So much for “ad awareness.”

But, that brings up another quirk of marketing measurement.  When sales are increasing, marketing is the hero.  Oh, but when sales are declining, marketing is the problem.  Unfortunately, it’s never that easy.

The biggest question to ask yourself is: “What results are important to you?”

For example, are you trying to increase membership?  Then measure membership count, and find a way to connect a new member to your marketing efforts.  Determining why a member cancels membership is also important.

Sure, increases in in-bound links, web traffic, store visits, phone inquiries, emails, search engine ranking, and so on are great, but do they matter to you or to your business goals?

Figure out what’s most important and measure exactly that.  And then make a connection between that result and your marketing.

Finally, don’t worry about all the so-called experts and their metrics and measurement tools.  None of them have figured it out yet.  There’s no “magic bullet” or “holy grail” of marketing measurement, especially when it comes to social marketing.

Go with what works best for you.  Just make sure you learn something to improve your marketing efforts moving forward.