Marketing has long been considered more art than science, but the demands of a more dynamic, globalized business world has led to the development of sophisticated methods for quantifying marketing success. Organized into eleven focused sections, this reliable resource offers an effective approach to making a complex topic understandable. Written for both marketing managers accountable for growth-driven activities that must yield measurable results as well as senior executives who need a firm understanding of marketing's impact on a business or product line, this informative guide puts more than 110 key metrics in perspective. Along the way, you'll be introduced to a variety of important analytical tools, from brand, customer, and sales metrics to advertising, price, and distributions metrics. And with the addition of new examples and metrics-including significant updates to the online/digital/social area- Measuring Marketing, Third Edition will put you in a better position to excel at this difficult endeavor.
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John A. Davis is Regional Managing Director and Executive Director, Asia - Duke CE. His career spans the academic and business worlds, as a senior executive and leader in both. He is the author of several acclaimed marketing books. John is a visiting professor at the International Olympic Academy in Olympia, Greece, and has also taught at University of Washington, UC Davis and Stanford University, and in partner programs with faculty from University of Chicago, INSEAD, Emory, Munich Business School, and the European Business School. John has also taught in dozens of executive education programs for leading companies, including: IBM, DOW Chemical, and Allianz. His research interests are in global brand leadership, marketing strategy, sports marketing, and marketing accountability. He received his M.B.A. from Columbia University and his B.A. from Stanford University.
Part 1: Corporate Financial Metrics 1 Chapter 1: Revenue 3 Chapter 2: Gross Profit 7 Chapter 3: Value-to-Volume Ratio 9 Chapter 4: Net Profit 13 Chapter 5: Earnings-Based Value 17 Chapter 6: Return on Sales 23 Chapter 7: Return on Assets 25 Chapter 8: Return on Equity 27 Part 2: Marketing Planning Measures 31 Chapter 9: Market Share 33 Chapter 10: Relative Market Share 35 Chapter 11: Market Growth 37 Chapter 12: Market Demand 39 Chapter 13: Market Penetration 41 Chapter 14: Program/Nonprogram Ratio 47 Chapter 15: Program/Payroll Ratio 49 Chapter 16: Causal Forecast 51 Chapter 17: Time Series Analysis 57 Part 3: Brand Metrics 63 Chapter 18: Brand Equity 65 Chapter 19: Brand Scorecards 71 Chapter 20: Brand Premium 75 Chapter 21: Brand Contribution and Review Analysis 81 Part 4: Customers Metrics 85 Chapter 22: Net Sales Contribution 91 Chapter 23: Time-Driven Activity-Based Costing 93 Chapter 24: Segment Profitability 95 Chapter 25: Customer Profitability 99 Chapter 26: Share of Customer 101 Chapter 27: Return on CustomerSM 105 Chapter 28: New Customer Gains 109 Chapter 29: Customer Acquisition Costs 113 Chapter 30: Cost Per Lead 117 Chapter 31: Retention Rate 121 Chapter 32: Churn Rate 125 Chapter 33: Consumer Franchise 129 Chapter 34: Customer Equity and Customer Lifetime Value 133 Chapter 35: Customer Brand Value 137 Chapter 36: Customer Losses 139 Part 5: Product/Offering Metrics 143 Chapter 37: Usage 145 Chapter 38: New Product Purchase Rate 147 Chapter 39: Marketing Cost Per Unit 151 Part 6: Price Matrics 153 Chapter 40: Price 155 Chapter 41: Mark-Up Pricing 159 Chapter 42: Target Return Pricing 163 Chapter 43: Sales Price Variance 165 Chapter 44: Markdown Goods Percentage 169 Chapter 45: Profit Impact 171 Part 7: Advertising/Promotion Metrics 175 Chapter 46: Share of Voice 177 Chapter 47: Recall 179 Chapter 48: Recognition 183 Chapter 49: Reach 185 Chapter 50: Frequency 187 Chapter 51: Gross Rating Points 189 Chapter 52: Cost Per Gross Rating Point 193 Chapter 53: Response Rate 195 Chapter 54: Conversion Rate 199 Chapter 55: Advertising-To-Sales Ratio 201 Chapter 56: Promotion Profit 203 Part 8: Direct Marketing Metrics 207 Chapter 57: Direct Marketing Revenue Goals 209 Chapter 58: Direct Marketing Profit Goals 213 Chapter 59: Direct Marketing Gross Profit 215 Chapter 60: Direct Marketing Net Profit 217 Chapter 61: Direct Marketing Return On Investment 219 Part 9: Digital/Social Metrics 221 Chapter 62: Gross Page Impressions (Or Gross Page Requests) 223 Chapter 63: Word of Mouth 225 Chapter 64: Total Clicks 1 Chapter 65: Click Through Rate 229 Chapter 66: Cost Per Click 231 Chapter 67: Cost Per Action 235 Chapter 68: Pay Per Lead 237 Chapter 69: Activity Ratio for Social Media 239 Chapter 70: Deductive Social Media Return on Investment 241 Chapter 71: Resolution Time 243 Chapter 72: Social Media Profitability 245 Chapter 73: Bounce Rate 247 Chapter 74: Return On Advertising Spend 249 Part 10: Place/Distribution Metrics 251 Chapter 75: Cost Per Sales Dollar 253 Chapter 76: Transactions Per Customer 255 Chapter 77: Transactions Per Hour 257 Chapter 78: Average Transaction Size 259 Chapter 79: Avergage Items Per Transaction 261 Chapter 80: Hourly Customer Traffic 265 Chapter 81: Returns to Net Sales 267 Chapter 82: Inventory Turnover 269 Chapter 83: Percent Inventory Carrying Costs 271 Chapter 84: Gross Margin Return on Inventory Investment 273 Chapter 85: Sales Per Square Foot 277 Chapter 86: Sales/Profits Per Employee 279 Chapter 87: Retail Close Ratio 281 Chapter 88: Retail Margin Percentage 285 Chapter 89: Percent Utilization of Discounts 287 Chapter 90: Shrinkage to Net Sales 289 Part 11: Sales Metrics Chapter 91: Net Sales Contribution 297 Chapter 92: Absolute Index 299 Chapter 93: Relative Index 303 Chapter 94: Percent of Sales 305 Chapter 95: Independent Sales Representative Analysis 309 Chapter 96: Turnover Rate 311 Chapter 97: Recruiting 315 Chapter 98: Breakdown Approach 317 Chapter 99: Workload Approach 321 Chapter 100: Sales Performance Quotas 327 Chapter 101: Average Sales Per Call 335 Chapter 102: Close Process and Close Ratio 337 Chapter 103: Cost Per Call 341 Chapter 104: Break-Even Sales Volume 343 Chapter 105: Sales Productivity 347 Chapter 106: Four Factor Model 351 Chapter 107: Sales Variance Analysis 355 Chapter 108: Sales Volume Variance 361 Chapter 109: Sales Enablement 365 Chapter 110: Net Promoter ScoreR 367 Index
This book is a go-to resource for marketers looking to better measure the effectiveness of their efforts. The depth of information and approaches it provides helps professionals go beyond the 'usual suspects' we use for metrics, and challenges us to explore new methods for determining how well we're performing. Even better, many of the techniques shift our view of measurement from being a passive reporting tool to using it to be a more forward-looking tool for change.
--Lisa Bodell, CEO, futurethink; Author, Why Simple Wins
There is a quote, attributed to Albert Einstein: "Not everything that can be counted counts, and not everything that counts can be counted." In this book of marketing metrics, John Davis provides a brilliant insight into the metrics that do count in marketing. Each metric is explained succinctly so that marketing managers can understand and apply them to their business in a practical way. In a world of disruptive technology and fast changing consumer preferences, knowing what should be measured and how it should be measured is critical. This book should be compulsory reading for all marketing managers who want to stay ahead of the competition.
--Professor Mark Farrell, Head, Graduate School of Business and Law, RMIT University, Australia
Creating sustainable value is crucial for today's companies, and marketing plays a central role in this effort. With so many tools available, from traditional to digital and social media, as well as sophisticated sales organizations and new distribution channels, measuring performance can get quite complicated. John Davis's book, Measuring Marketing, is the perfect solution, offering clear descriptions and examples of how to measure the value contributed by the various marketing investments. Measuring Marketing is an excellent resource that every marketer and CMO should use.
--Hari Nair, Group Chief Strategy & Innovation Officer, Sime Darby, Kuala Lumpur Malaysia
John has delivered a comprehensive, end-to-end view of how to measure and create value. His expertise and approach are increasingly critical for any business to remain competitive.
--Thomas McCabe, Chief Country Officer, USA, DBS Bank
John Davis is a recognized expert in the field of marketing science. Measuring Marketing combines advances in the academic analysis of quantifying marketing impact together with deep industry insights to ensure...application to today's marketing organisations and companies.
--Steve Leonard, CEO, SGInnovate, Singapore
One variation of a managerial maxim goes that you can't manage what you can't count. John Davis has provided a cartograph of just how to do this. This book sits as comfortably on the aisle of financial analysis books as it does on the aisle of marketing books.
--Pakpoom Vallisuta, Chairman of The Quant Group; Board member of The Board of Visitors, Fuqua School of Business, Duke University
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