The current economic environment makes marketing professionals' ability to produce desired results—as efficiently as possible—top-of-mind. Knowing what to improve and by how much is vital to establishing realistic performance targets and metrics.
This two-part article discusses how to use benchmarking to assess your organization's performance and to understand what changes to make. Part 1 defined benchmarking and explored its value.
This second and final part identifies marketing capabilities and process that can be benchmarked and outlines the five phases associated with a successful benchmarking initiative.
Marketing Processes and Capabilities to Be Benchmarked
Which marketing processes and capabilities should your company benchmark? Research by Doug Vorhies, Neil Morgan, and others has revealed eight marketing capabilities that can be benchmarked:
- Product development (the processes by which a company develops and manages product and service offerings)
- Pricing (the ability to extract optimal revenue from your customers)
- Channel management (the organization's ability to establish and maintain channels of distribution that effectively and efficiently deliver value to the end-customer)
- Marketing communications (the organization's ability to manage customer value perceptions)
- Market information management (the processes that organizations use to learn about their markets and use market information)
- Marketing planning (the organization's ability to create optimal marketing strategies)
- Marketing implementation (the processes which strategies are deployed)
Various studies have shown that companies that excel at these marketing capabilities significantly outperform those that are below the benchmark in terms of customer satisfaction, return on assets, profitability, and market effectiveness.
Therefore, companies and organizations wishing to improve in these areas should consider benchmarking their marketing capabilities by searching among competitors and peers in other industries to identify the drivers of superior performance.