Good marketing makes the company look smart. Great marketing makes the customer feel smart.– Joe Chernov
Good marketing is no accident, but a result of careful planning and execution. To compete and thrive in this world of business a good marketing strategy is required. But how to know, which one is working for organisation? For business competitiveness and sustainability, it is important to have appropriate metrics for measuring marketing effectiveness (Ambler, T, & Roberts, J 2008).
Managers uses range of metrics by which they can evaluate marketing strategies and its dynamics. A metric is a measuring system that quantifies a trend, dynamic or characteristics. In general metrics are set of disposals that help companies quantify, compare and at last interpret own performance. Different marketing metrics used are behavioural metrics, financial metrics, memory metrics etc. which are divided into financial and non-financial metrics. Let’s look into them in detail (Farris, 2010).
- Financial Metrics:
The ultimate aim of any marketing campaign is to generate profitable sales. Shareholders, executives and marketers expect company to maximise profits to have highest return on their investments. For this company uses financial metrics to measure sales revenues, minimise overhead expenses, maximising gross margins and managing investments to appropriate risk and expected returns (Lenskold, 2003).
Apple which is widely known for its innovative marketing strategy has increased its net income to $53.39 billion U.S. dollars in last ten years.
Apple reported $233.7 billion dollar’s revenue in 2015 which is increased from last years with spending of $1.8 billion on marketing. Increase in net income proves that marketing campaign giving return on investment for all stakeholders.
- Behavioural and Memory Metrics:
The behavioural metrics comprise of how much market share does company holds? what is market penetration in particular period? sales quantity? how often the customers purchase a product? Etc. Whereas memory metrics mostly related to brand and customer services. What is brand image and its awareness in customers, are they satisfied with quality of services offered? etc.
For this will look into an energy drink Austria based company RedBull. RedBull has created market for energy drinks and they have the highest market share throughout the world. Even though tough competition in sports drinks market RedBull enjoys 43% of market share (Mitchell, 2015). RedBull’s marketing strategy mostly based on associating with different sporting events and not only by sponsoring but owning teams and events.
Rich media and continuous fresh content in TV and digital world gave them edge over competitors ultimately resulting in continuous increased market share over the years and ramping up brand image (2016, UCI MTB World Cup 2016 and 2016, 2016). RedBull sold 5.96billion cans across 169 countries in 2015. Top markets included India (+18%), South Africa (+19%), Poland (+18%), Turkey (+25%) from 2014. Also, strong growth in sales and expansion can be seen in upcoming years’ in USA, western Europe and far East. Most of the customers love RedBull taste and its variants (Forbes.com, 2016). That shows their product quality made an impression over customer ultimately resulting into increased purchase frequency and cult following.
- Physical Availability Metrics
Availability of products for consumers results in more sales and market share. It is very important for company to find out where their customers are and how to reach out to them. Marketing physical availability metrics gives insight about this. The supermarket giant Woolworth is spreading its stores availability in Australia to reach out to customers in even remote regions of big cities. The online presence and Woolworth Metro (small version of supermarket) gaining popularity in high competitive market. Currently it operates 980 stores Australia wide and increasing which allows customers ease of grocery shopping.
- Marketing Activity and consumer profile metrics
To drive more sales, it is very important from a business perspective to know customers well and understand different patterns associated with them like age, gender etc. Amazon.com is carrying out thorough customer analysis and providing them related products helping them in attracting more customers in their online store. Amazon.com uses in depth analysis of who are the customers visiting which products, their geographical presence and using search engine optimisation techniques they are providing great online shopping experience for consumers.
2016, G., UCI MTB World Cup 2016, G. and 2016, U. (2016). Red Bull Gives You Wings – RedBull.com. [online] Red Bull. Available at: http://www.redbull.com/au/en [Accessed 20 May 2016].
Ambler, T, & Roberts, J 2008, ‘Assessing marketing performance: don’t settle for a silver metric’, Journal Of Marketing Management, 24, 7/8, pp. 733-750, Business Source Complete, EBSCOhost, viewed 21 May 2016.
Farris, P. (2010). Marketing metrics. Upper Saddle River, N.J.: FT Press.
Forbes.com. (2016). Forbes Welcome. [online] Available at: http://www.forbes.com/companies/red-bull/ [Accessed 21 May 2016].
Lazzaroni, D. (2014). 75 Quotes to Inspire Marketing Greatness. [online] Business.linkedin.com. Available at: https://business.linkedin.com/marketing-solutions/blog/7/75-quotes-to-inspire-marketing-greatness [Accessed 21 May 2016].
Lenskold, J. (2003). Marketing ROI. New York: McGraw-Hill.
Markets.ft.com. (2016). Apple Inc, AAPL:NSQ financials – FT.com. [online] Available at: http://markets.ft.com/research/Markets/Tearsheets/Financials?s=AAPL:NSQ [Accessed 21 May 2016].
Mitchell, D. (2015). These Are the Top 5 Energy Drinks. [online] TIME.com. Available at: http://time.com/3854658/these-are-the-top-5-energy-drinks/ [Accessed 15 May 2016].
Sanket Landge (215022149)