Download Chapter 6: Developing Product and Brand Strategy

Chapter 10:
Planning Metrics and
Implementation Control
The Marketing Plan Handbook
Fourth Edition
Marian Burk Wood
10-1
Measuring What Matters
Measurement
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Metrics to gauge progress toward achieving
objectives.
Forecasts of future sales and costs.
Budgets allocating financial resources.
Schedules identifying the timing of marketing tasks.
Control



Identify.
Analyze.
Correct.
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Metrics

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Focus employees on activities that make a
difference.
Set up performance expectations that can
be objectively measured.
Lay a foundation for internal accountability
and pride in accomplishments.
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Main Categories of Metrics
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Marketing Dashboard

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Computerized, graphical presentation.
Helps managers see the situation at a
glance, based upon a limited number of data
inputs.
Varying levels of dashboards: Corporate,
divisional, or functional.
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Identifying Metrics

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Working backward from mission, goals,
and objectives.
Looking for key components or activities
related to customer buying behavior.
This would include metrics for each of the
three key areas:



Marketing objectives.
Financial objectives.
Societal objectives.
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Sample Marketing Metrics
Objective
Metric
To acquire new customers.
Measure number or percentage
of new customers acquired by
month, quarter, year.
To retain current customers.
Measure number or percentage
of customers who continue
purchasing during a set period.
To increase market share.
Measure dollar or unit sales
divided by total industry sales
during a set period.
To accelerate product
development
Measure the time needed to
bring a new product to market.
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Sample Financial Metrics
Objective
Metric
To increase sales revenue by
product.
Measure product sales in
dollars per week, month,
quarter, or year.
To improve profitability.
Measure gross or net margin for
a set period by product, line,
channel, marketing program, or
customer.
To reach break-even.
Measure the number of weeks
or months until a product’s
revenue equals and begins to
exceed costs.
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Sample Societal Metrics
Objective
Metric
To make products more
environmentally friendly.
Measure the proportion of each
product’s parts that are
recyclable or have been
recycled during a set period.
To build awareness of a social
issue.
Measure awareness among the
target audience after the
program or a set period.
To conserve electricity or fuel.
Measure amount used by
month, quarter, year.
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Examples of Behavioral Metrics
Behavior
Metric
Customer Awareness
Customer awareness per
telephone survey.
Customer Learning
Number of information packets
requested, number of hits to a
website.
Customer Attitudes
Customer attitudes per
telephone study, feedback on
blogs, customer letters.
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Using Metrics
Metrics are most valuable to the marketer
when viewed in the context of:

Expected outcomes.

Historical results.

Competitive or industry outcomes.

Environmental influences.
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Forecasts

Future projections of what sales and costs are
likely to be.

Can never be more than good estimates.

Need to be reviewed often.

Must account for the impact of marketing
programs.
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Forecasts of Sales and Costs

External factors to consider:
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Demand.
Threats.
Opportunities.
Internal factors to consider:

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Goals.
Capabilities.
Constraints.
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Types of Forecasts

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Market and segment sales.
Company product sales.
Cost of sales.
Sales and costs by channel.
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Judgmental Tools for Forecasting
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Sales force estimates.
Executive opinion.
Delphi method.
Online prediction market.
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Budgets
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Budgets are time-defined allocations of
financial outlays for specific functions,
programs, customer segments, or
geographic regions.
Enable marketing managers to:


Allocate expenses.
Compare estimates with actual expenses.
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Examples of Budgeting Policies

Follow internal financial calendars.
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Specify profit hurdles.
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Specify particular assumptions.

Mandate particular formats or supporting
documentation.

Best-case, worst-case, and most-likely scenarios.

Adjusting budgets monthly instead of annually.
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Budgeting Methods
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Affordability budgeting.
Percentage-of-sales budgeting.
Competitive-parity budgeting.
Objective-and-task budgeting.
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Affordability Budgeting

Budgeting what you believe you can afford.
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Advantages:

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May work for start-ups.
Disadvantages:


Does not allow for the kinds of significant ongoing
investments often needed to launch major new
products or enter intensely competitive markets.
Ignores profit payback calculation.
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Percentage-of-Sales Budgeting

Budgeting against a set percentage of sales.

Advantage:

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Simple to implement.
Disadvantages:
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Sales are seen as the source of marketing funding,
rather than as the result of budget investments.
Difficult to justify the % set aside for marketing.
Self-defeating: lower sales may lead to a lower
marketing budget.
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Competitive-Parity Budgeting

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Budget allocation for advertising based on
the expenditures of competitors.
Advantage:


Simple to implement.
Disadvantages:

Ignores differences between companies.

Does not allow for adjustments to meet specific
marketing objectives.
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Objective-and-Task Budgeting


Adding up the cost of completing all of the
marketing tasks needed to achieve
marketing plan objectives.
Advantage:


A reasonable build-up method.
Disadvantage:

May add up to more than the firm can afford.
Priorities may have to be established.
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Schedules

Schedules are time-defined plans for
completing a series of tasks or activities
related to a specific program or objective.

Help avoid conflicts.

Help measure progress toward completion.
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The Scheduling Process
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List the main tasks and activities.
Assign each a projected start and end date.
Determine who is responsible for each task.
Develop an overall summary schedule.
Develop detailed schedules for each subprogram.
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Controlling Marketing Plan
Implementation
Four types of marketing control help
marketers gauge the effectiveness of the
plan implementation:

Annual Plan.

Profitability.

Productivity.

Strategic Control.
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Applying Control
1.
2.
3.
4.
5.
Set objectives.
Determine metrics.
Determine measurement intervals.
Measure.
Take corrective action, if necessary.
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Contingency Plans

Plans that organizations have ready to
implement if their original strategies are
disrupted by significant, unexpected
changes, such as:



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Computer system outages
Power outages
Natural disasters
Etc.
Should be creative in terms of considering
options, priorities, and resources.
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mechanical, photocopying, recording, or otherwise, without the prior written
permission of the publisher. Printed in the United States of America.
Copyright © 2011 Pearson Education, Inc.
Publishing as Prentice Hall
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10-28