LONDON/AUSTIN, TX: Benchmarking – the use of an external best practice reference point – is essential to a culture of continuous improvement and can be applied to seven marketing capabilities, according to an industry figure.
Writing in the current issue of Admap, Laura Patterson, president and founder of VisionEdge Marketing, lists these as product development, pricing, channel management, marketing communications, market information management, marketing planning and marketing implementation.
Companies who excel at these marketing capabilities, she explains, “significantly outperform those who are below the benchmark in terms of customer satisfaction, return on assets, profitability, and market effectiveness”.
Her article, Achieve marketing excellence through benchmarking, goes on to outline how benchmarks can come from within or outside the industry in which a business is operating, but in all cases the process entails five stages, starting with measuring one’s own performance – the basic requirement on which everything else is built
At the planning stage, the issues or critical success factors that have the greatest potential for improvement and impact are defined. “It is important during this stage that it is very clear how improving one of the marketing capabilities will add value to the company,” Patterson advises.
The next step is study deployment, where decisions are made on which particular aspect of the marketing capability should be studied and how the data will be collected, organised, and analysed.
“Whatever process(es) you decide to benchmark, you want to benchmark the process, the performance drivers, and the cost and time associated with each,” says Paterson.
Thus, “for channel management, it may be worthwhile to benchmark the strength of the relationship with distributors, or the benchmark company’s ability to attract and retain the best distributor(s)”.
A gap analysis then focuses on locating, understanding and interpreting the gaps that emerge from the data compared to existing performance for that process or capability.
Finally, “once you understand the gap, what performance could be, and the underlying drivers of how the benchmark is achieved, create a plan of action that will help your organisation toward decreasing the gap and achieving the results”.
Sourced from Admap