Question

Topic: Research/Metrics

How To Measure Marketing Activities

Posted by Anonymous on 2/18/2009 at 9:39 AM ET 50 Points

I need some input on what KPI should we use to measure Marketing Activites.

Is it based on profit or expenses?

Thanks

Paulus
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RESPONSES

  • Posted on 2/18/2009 at 9:42 AM Member
    Hi Paulus

    It depends on what do you want to measure, if you want to measure the impact you can measure on calls coming in asking about the product or service, or by sales value but this will tae time as it can be the impact on the merchants and still there is no off take, also it might be an awareness campaign and all you need to measure is the brand awareness level

    Please give more details
  • Posted by wnelson on 2/18/2009 at 9:48 AM Accepted
    Paulus,

    Marketing should be treated as an investment - like buying a new piece of equipment for manufacturing or developing a new product. As such, it is appropriate to measure marketing activities in terms of return on investment (ROI). ROI takes into account the profit you make as a result of the activity and the amout invested. Specifically, ROI is the ratio - the resulting profit divided by the investment in that activity. With this measure, your marketing investments may be compared to all the other investment opportunities for the firm.

    I hope this helps.

    Wayde

  • Posted on 2/18/2009 at 9:53 AM Author

    Wayde,

    You are right. Just to confirm myself.

    Thanks

    paulus
  • Posted on 2/18/2009 at 9:57 AM Author
    Wayde,

    What about measuring ROI for branding investment.

    Branding is a bit hard to measure in our strategy map that gives % of change to our increased revenue....

    Paulus
  • Posted by wnelson on 2/18/2009 at 10:07 AM Accepted
    Paulus,

    If I understand you correctly, you have a goal that is to increase revenue by a percentage - correct? Let's say your goal is 10%. If you change your revenue from the 2008 figure of $1,000,000, you'd be increasing revenue by $100,000 to meet that goal - correct? The product line has a 2008 profit figure - for this example, let's say it's 20%. So the profit on a $100,000 increase in revenue would be $25,000. If you invest $10,000 in branding, your goal ROI is 2.5. Does this make sense?

    Wayde
  • Posted on 2/18/2009 at 11:02 AM Author
    Thanks very much. very useful input.

    Regards

    paulus
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