Here’s part 7 of my series on the Marketing Performance IndexTM, an objective assessment of relative marketing performance measuring Market Presence, Brand Strength and Pipeline Health, and providing an overall score based on industry best practices. In this blog, I cover key considerations in measuring marketing performance, including:
🔍 How to get the CEO to measure marketing performance objectively
📅 Success in the First 90 Days, and every quarter thereafter
📈The McKinsey perspective: how a strong CEO and CMO relationship can drive higher growth
🎯 Getting into alignment (with the C-suite) and maintaining equilibrium
📋 How to take the free marketing performance index diagnostic in about 30 minutes
Getting agreement on your performance parameters, from the CEO and other stakeholders, is essential for every marketing leader. When you first join a company, the expectations for what “marketing will deliver,” i.e., the key priorities to focus on, the key programs to execute, the key outcomes to achieve, are generally understood. The problem is that after the first 90 days and getting an initial agreement on your charter, things are bound to change, e.g., you encounter economic headwinds, company executional challenges, market and competitive shifts, new investors or board members reset requirements, etc. So how do you get back into alignment with those who most influence your success and job satisfaction?
One of the best ways to get agreement on the metrics that matter most is to establish a baseline of the current situation you’re inheriting (the hand you’ve been dealt!). If you can’t get agreement on the objective targets you must meet, it’s going to be a lot harder to ensure that you are viewed as a strong performer (by the CEO, peers, investors and/or the board). Just like Sales, you have to “make” every quarter to maximize your tenure and overall contribution to the business.
Over the past few months, I’ve published several blogs on the Marketing Performance Index. And a number of CMO peers have taken my free diagnostic during this time. We’ve discussed the criticality of getting agreement not only on how you will be measured, but also what good looks like, and what are the KPI or metrics you must attain. In each case, we’ve found there are executional gaps at every company, so the more you can communicate and socialize what you’re doing, where marketing is achieving, falling short, improving, etc., the better.
As I’ve shared throughout this blog series, taking ownership over how you will be measured is the best way to ensure a fair assessment of how you and your team are performing. I created the Marketing Performance IndexTM based on my experience leading marketing organizations for nearly 20 years. And I selected the three primary measurement components, Market Presence, Brand Strength and Pipeline Health, and the six performance indicators, Reach, Share, Engagement, Loyalty, Pipeline, and Progression, because I truly believe these measures most influence marketing success or failure. Nevertheless, every CMO needs to determine what metrics matter most at their company, with their C-suite peers, and with all key stakeholders. I have picked 24 key metrics, but you may have only 5, or perhaps even 50. Getting agreement on what to measure, drive, report on, ignore, improve, etc. is critical to your overall and long-term success.
I recently revisited this insightful article by McKinsey on how a strong CEO and CMO relationship can drive higher growth. The authors, including Robert Tas, pointed out that “In the modern marketing era, CMOs can report endless key performance indicators (KPIs): cost per click, click-through rate, brand awareness, and so on. But metrics have different purposes, and CEOs are often not given the right measurement tools to evaluate marketing’s performance and business impact. The world has changed … and Marketers are speaking a complex language and (can) drown CEOs and CFOs in data. Sometimes CEOs feel they are missing the link between marketing measurement and business impact… CEOs cannot properly manage their growth strategy without understanding a direct link between marketing measurement and business impact.”
This is exactly why I created the Marketing Performance Index. To help CMO’s and CEO’s get on the same page, to speak in the language of numbers that everyone can understand. Marketing is a complex function, it’s a non-linear equation, it’s both art and science, but if you don’t get agreement on objective, measurable outcomes, the job will be much more difficult, and your tenures will be more tenuous. In the article, McKinsey went on to say: “This new engagement model also demands a better measurement framework for growth: CEOs must work with their CFOs and CMOs to outline a marketing measurement framework that shows impact—and is one that everyone understands… “CEOs should first ask themselves: what outcomes—not activities—do I want from marketing? Then they should ask their CMOs: what are the best levers to achieve the outcomes? Why do you believe in these? What are the returns? Evaluate marketing in a way that’s productive to the business and be open to the idea that marketing can generate value.”
Thank you McKinsey! I could not have said it better. The Marketing Performance Index does just that: it helps you and your stakeholders evaluate marketing in an objective, productive manner (vs. a subjective, random approach), and enables marketing leaders to not only demonstrate their material contributions to company growth and success, but also prove the value of marketing.
Over the past couple of months since first publishing the Marketing Performance Index, I’ve conducted a number of marketing assessments with my peers. In each case, the diagnostic has helped them uncover key performance gaps and sharpen their focus on where to invest people and financial resources to drive improvements and better outcomes.
If you’d like to take the Marketing Performance IndexTM assessment while I’m developing the online, self-service version, send me a note and I’d be happy to arrange it.
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CMO Mentor 