Marketing Accountability Becoming a Business Norm, Reports ANA

07 September 2007

NEW YORK: Formal marketing accountability programs are becoming an accepted business practice among marketers, reports the US Association of National Advertisers in a report to be presented at its Marketing Accountability Forum in Palm Beach, Florida next week.

Almost all the companies surveyed (92%) have set-up a marketing accountability process of some kind. But, warns the report, dissatisfaction about marketing measurement and internal marketing accountability processes is "rampant".

The survey, conducted among 200 senior-level marketers by Marketing Management Analytics, reveals a lack of consistency as to how accountability processes are managed and which departments are responsible:

  • Informal / grass roots efforts (24%)

  • Marketing department exclusively (31%)

  • Cross functional management - marketing, IT, finance (20%)

  • Marketing and finance only (17%).
Moreover, over half of all respondents expressed unhappiness with the methodology employed to establish accountability:
  • Dissatisfaction with marketing ROI measurements (42% - up 7 percentage points)

  • Lack of marketing ROI definitions (45% - up 20 percentage points).

  • Poor organizational response to marketing ROI data (48% - up 16 percentage points).
The study found that the relationship between marketing and finance still lacks strength and consistency - particularly when attempting to establish metrics and methodologies for measuring marketing return on investment (ROI).

Most marketers (61%) indicated "some" cooperation between marketing and finance, while only 22% indicated full cooperation. In about one-half of the companies, respondents said that the marketing and finance departments don't speak with one voice or share common metrics.

Only 55% said their marketing ROI goals were closely aligned with their company's overall corporate goals while half (51%) said there were no written goals for marketing ROI in their organizations.

The most commonly used metrics to measure marketing effectiveness are …
  • Changes in brand awareness (81%)

  • Changes in market share (79%)

  • Changes in consumer attitude toward the brand (73%)

  • Changes in purchase intent (59%)

  • Return on objective (36%)

  • Lifetime customer value (23%)

  • Changes in the financial value of brand equity (20%).
There is also evidence a a chasm between what companies are measuring and what they feel is most important to measure.

For example, 70% of respondents said "return on objective" was an important measure, although only 36% were using that as a measurement tool.

Comments ANA president/ceo Bob Liodice: "A company's ability to make effective marketing decisions requires relevant and targeted metrics and measurements.

"It is incumbent upon marketing to work cohesively with all cross-functional teams to establish common goals and processes to determine if those goals have been reached.

"It is clear from this study that although progress has been made, there is a substantial gap that still needs to be bridged."

Data sourced from ANA (USA); additional content by WARC staff