MX - ARTICLE- Embrace the Data CIO.com

FROM CIO.com March 16,2005 web edition
http://www.cmomagazine.com/read/030105/be_counted.html

Count—and Be Counted

Embrace the data. But not just any data. In the quest for ROI, CMOs actually have to know why they're doing what they do.

By Anonymous
ADVERTISER

Think for a minute if you will about the business you're in. It could be in manufacturing or in a service industry. Now ask yourself this: Is any part of your business still being conducted the same way it was 50 years ago? Is any process involving millions of dollars of expenditure still being scrutinized the same way as it was in 1955? I doubt it. So why are you still using research tools that are at least a half a century old to measure marketing performance?

Marketing continues to be the only black hole in this world of business accountability. The CEO, CFO and CIO have to measure everything they do to keep the stockholders at bay. In contrast, those of us in marketing (if we're lucky enough even to recognize our lack of accountability) excuse it by calling our work more art than science. If you're like me, the standard four media outlets (television, radio, newspapers and magazines) consume more than 70 percent of your total marketing budget. In many cases, that budget runs into the hundreds of millions of dollars. How is it that we accept such poor measurement and accountability for that level of investment? Is it a wonder that so many CMOs are treated differently from their C-level peers?

Well, the old business adage that "you can manage only what you can measure" has finally taken center stage in marketing. Every marketing conference I've attended in the past two years has featured a discussion on ROI. Every meeting with my CFO has centered on ROI. My most unpleasant meetings with the CEO have been about ROI (or the lack thereof). CEOs are reaching out to financial consultants to come up with a superior way of tracking marketing ROI. And I have to warn you: This latest trend is not contributing to an improvement in job security for CMOs. If we don't truly embrace the need for superior measurement of ROI, marketing will never get the respect it seeks. And we may find ourselves out of a job.

Unfortunately, the tools we have in place are the foundation of advertising's pricing structure. Advertisers fund content, whether for a sitcom or a Super Bowl, in the hope that the audience will also be exposed to the company's product. I'm sure you remember the furor created by the dramatic drop in young men watching television in 2004. In my circle of marketers, the drop-off rate among this group made sense given the tremendous growth of video games. The television media was, not surprisingly, apoplectic about such findings and seriously challenged the data. (Naturally, nobody has ever challenged the data when it has shown or supported an increase.)

All that begs still another question: Just how much do we really know about the consumer's media consumption and comprehension? Our data is often flawed or, in many cases, simply irrelevant. But mostly, it's just plain unavailable. Marketers and media are the masters of measurement when it comes to ad inventory, but we are still in the dark ages in terms of accurately measuring consumption. All the people meters and click-through rates aren't getting us where we need to go.

To be fair, companies such as Procter & Gamble are trying to bring about real marketing change when it comes to the accountability issue, and some innovative marketers are climbing on board. Unfortunately, far too many CMOs are not engaged in the quest for better data. They seem to have an expectation that the industry will fix itself. For it to be fixed, however, everyone will need to stand up and be counted.