Improve Marketing Efficiency and Increase Profit

A recent study (covered in eMarketer) shows that the effectiveness of marketing has reached an all-time low - 65% of the marketing spend of those surveyed had no discernible effect on consumers in 2007. The report suggests the main cause of the waste can be largely attributed to lack of measurement, as well as "media clutter, sophisticated consumers and intense competition". Of the 55% of marketers who track their spending, 80% do so manually, spending hours gathering and analyzing data. Only one in 10 marketers surveyed had automated systems in place to track the effectiveness of their spend.

So what can a marketer do about the problem? Chief Marketer provides a few ideas on how to improve marketing effectiveness and demonstrate its capability to influence business results. After going through a detailed discussion of how to use (and not to use) marketing budgets, corporate profit, etc. to measure marketing efficiency, the writer has three suggestions:

  • Focus on groups of low responders and establish more refined selection filters, thereby eliminating the least responsive customers.

  • Refine customer segmentation in order to improve targeting and raise response rates.

  • Test new promotions to boost the accuracy of marketing's perception of the customer.

Finally, the right metrics can also help marketers determine which of their activities are high-return vs low-return. By increasing funding for their high ROI efforts, it may become easier to allocate the existing budget more effectively in order to generate additional marketing dollars.



Posted by Universal Ad

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