Marketing controlling accompanies marketing and individual marketing activities by making the marketing goals measurable with the help of key figures, performing target/actual comparisons and reporting results. This enables improvements in marketing and in the marketing process.
Marketing controlling as the basis of marketing planning and evaluation of marketing campaigns
Many companies and their responsible marketing managers plan their marketing activities from the gut. Once the marketing budget has been negotiated with the management, it is distributed across different actions and measures. There are often no objective rules or standards for this distribution. Tradition often plays an important role; it’s just done the same thing as last year. After all, veteran marketing managers have built up a wealth of experience, based on which they roughly know which marketing campaign is working and which is not.
But you shouldn’t just rely on your experience to assess the effectiveness of marketing campaigns. You should take a closer look in marketing: Check and measure whether a single marketing campaign really helps to achieve the marketing and company goals. To do this, you need to integrate marketing controlling into marketing planning and the marketing process.
Set marketing goals and campaign goals for each marketing campaign
For each marketing campaign, it must be clarified which marketing goals are associated with it and what exactly the campaign is intended to achieve. These are the respective action goals. Examples of marketing and campaign goals are:
Marketing goal: increase customer value
Action goal: With the dispatch of a product catalog, the order frequency of existing customers should increase.
Marketing goal: strengthening the brand
Action goal: poster advertising is intended to increase brand awareness.
Marketing goal: Increase market share Action goal: With a discount campaign at the point of sale, customers should be lured away from the competitor and buy their own product permanently.
If appropriate action goals are named, the following must be checked:
- What are the expectations regarding the individual action goal?
- Which target specification for target achievement should be set for the individual action target?
During and after the marketing campaign, check whether these goals are achieved. To do this, compare how individual key figures change and whether the actual values correspond to the target specifications. If there are deviations, the causes are researched.
Develop target specifications to measure target achievement
It is difficult to name expectations with regard to individual action goals and to translate them into target specifications. What target achievement can be expected? What are realistic and at the same time demanding requirements? These requirements can be derived from company goals themselves, from overarching marketing goals and from experience with comparable marketing campaigns. You have the following options:
- Determine target specifications in relation to competitors; for example, in the form: “We want to be better than our competitor A!”
- You can make industry comparisons or use particularly good pioneering examples as a benchmark.
- Finally, you can also use past experience (update) to determine a plan value and make target specifications.
In addition, you always have to compare the achievement of goals and the benefits associated with them with the effort for the respective marketing campaign. Key figures must therefore evaluate and prove the profitability of a marketing campaign. This can be done using break-even analysis, for example. You determine what effect a marketing campaign must have in the sense of “more sales” or “more profit”. These must at least record the costs of the marketing activity.
In practice, it is very difficult to meet this requirement. It is dangerous if marketing campaigns are canceled because the economic viability cannot be precisely determined; it is also harmful if expensive marketing campaigns are carried out again and again and nobody knows what they bring.
Define Key Figures and Collect and Measure Data
If the objectives of the action are named and expectations are clear, then it must be clarified:
- Which key figures are suitable to measure the success in relation to the action goal?
- To what extent do the indicators show whether and to what extent the respective goal has been achieved and the target has been achieved?
The data for the key figures that are to be used to measure the achievement of objectives must be collected and measured with reasonable effort. Appropriate methods and procedures must be defined for this. Some data can be determined via accounting (sales, sales, orders), others are recorded in product controlling or sales (contribution margin, number of offers, sales per customer) or the data can be filtered out from other systems (sales receipt, inventory, website visits).
For some key figures, special measurement or survey methods have to be set up. For example, customer observations at the point of sale, customer surveys with a questionnaire or interview guide, counts of trade fair visitors or workshop participants.
The following is important for the measurement:
- If possible, carry out a zero measurement; determine the actual value before you carry out the marketing campaign, because this is the starting value with which you can compare the effect.
- Some marketing campaigns only take effect after a certain time or have after-effects; consider such delays and measure the key figure for a while after the end of the marketing campaign.
With these measurements you record the actual values for your evaluation.
Document target-actual comparison and results of marketing Campaigns
When a marketing campaign is carried out, the target specifications are then compared with the actual values achieved. Deviations are analyzed and reasons for them are determined. The results of the analysis are shown and flow into the further planning of individual campaigns or into the overall marketing plan. For clear documentation, it is advisable to create short reports on the success of a marketing campaign (reporting) and to discuss findings and conclusions for the future in the marketing team (lessons learned).
Marketing campaigns are not only checked in the context of marketing controlling from a strategic and operational point of view. The course of the action can also be checked. The question is: have the process objectives been achieved? You should find answers to the following questions:
- How was the action rated by the customers?
- How was the cooperation with the partners?
- What mistakes have been made?
- What was really done well?
- What insights are there for future marketing campaigns?
- How is the marketing campaign to be assessed overall?
Example: Placing an advertisement in the regional daily newspaper
A handicraft company wants to become better known in its region and introduce potential customers to a new, special service. For this purpose, an advertising campaign is to be launched in the regional daily newspaper; An advertisement should be placed twice a week for a period of three months. The newspaper publisher offers to conduct a reader survey during and after the campaign.
The corporate and marketing goals are:
- Gain new clients
- Generate sales with the new service
Action goals are:
- Increase awareness of the company
- Awaken interest in the new service
These action goals can be differentiated with regard to the chosen form of advertising:
- Address as many people as possible in the target group
- To catch attention
- Readers should remember the ad
- They should understand what is meant by the service
- The company should appear credible and positive
- Customers should become active and express their interest via a website (landing page) or by calling
Key figures are defined for these individual action goals. They are determined as follows:
- Number of people reached from the publisher’s media data (newspaper edition) and from the known data on characteristics of the readers (e.g. age).
- Attention, memory, comprehensibility and credibility are determined by the publisher with the help of a customer survey (telephone interview).
- The company records the number of website visits and completed inquiry forms as well as the number of calls.
Goals and targets are set for the individual action goals. Goals and targets are, for example:
- 10 percent of the target group in the region remember the company positively.
- 500 people download the information brochure on the new service from the website.
- There are 50 requests for an offer.
Three months after the end of the campaign, it can be seen that these goals were only partially achieved (target-actual comparison). The telephone customer survey shows (examples):
- The display was not optimal
- Part of the advertising campaign ran during the holiday season
- The form on the website was not user-friendly
The success of the advertising can be compared to the costs of the entire campaign. The company can now draw conclusions from this: Has the marketing budget been used well? Do you want to run the campaign again? Should direct mailing take place instead?
Derive marketing goals from the corporate goals and the corporate strategy
The corporate goals and the corporate strategy are the basis for the marketing goals. The marketing goals describe what is to be achieved with marketing as a whole.
- Describe the marketing goals and link them to the company goals and strategies.
- Also show to what extent the marketing goals are aligned with the developments that you have observed in the context of strategic marketing controlling and the developments in the company’s environment.
Plan Marketing Campaigns and Set Campaign Goals
In order to achieve the marketing goals, individual marketing campaigns are planned as part of marketing planning and linked to the marketing goals. The success of the marketing campaigns is then checked again as part of operational marketing controlling.
- Which marketing actions are planned in your marketing planning?
- Which marketing goals should be achieved with it?
- What action goals can be set for this?
- What exactly do you expect in relation to these marketing and campaign goals?
- Which target specifications can you derive from this?
Check how you can tell whether the goal has been achieved. These can be possible key figures with which the achievement of goals is measured.
Monitor Marketing Campaigns with Key Figures
You have to monitor each marketing campaign based on key figures and measure the target contribution of the campaign.
- Define the key figures and explain how they are defined.
- Clarify how and when you want to measure the key figures.
- To do this, collect the actual values for the defined key figures at suitable intervals.
- Determine the actual values before, during and after the marketing campaign.
- Compare the actual values with the target specifications for the marketing campaign.
- Make developments and target contributions visible through the marketing campaign.
- Identify possible cause-effect relationships for the marketing campaigns.
- Make recommendations for marketing: What should be retained, improved, deleted, expanded?