The Science of Marketing Measurement
01.14.2010 / Posted in Articles, Measurement, Strategy
The scientific method—or a business variation of it—should be applied to the marketing process. These steps must be followed to ultimately gain meaningful insight into marketing’s effectiveness.
Step One: Define the Question
Defining the question is the first step scientists take when they want to test a theory. Business people must begin a step earlier by determining what the company needs to accomplish. The question then becomes, “What strategic mix of marketing tactics will best achieve our business goals?”
Step Two: Form a Hypothesis
Next, scientists perform research aimed at gathering information on which to base a hypothesis. For companies putting together marketing plans, competitors, audiences, and marketing and media trends must be analyzed, as well as the relative success or failure of past marketing efforts. As they use the information gathered to develop strategies and tactics, marketers must figure out how they will determine if their chosen courses of action achieve stated goals.
Step Three: Test and Measure Results
Compared to scientists or purely academic researchers, companies performing marketing activities face a distinct disadvantage in this phase of the process. Although some companies may be able to test new products or campaigns in selected test markets, few have the resources or luxury to try out their theories in controlled environments. In the business world, tactics must often be implemented with little testing and must get results. This necessary focus on action is likely one reason that measurement falls by the wayside for many organizations. Companies are in business to make money, not prove scientific theories, so executives are left to fall back on faith.
Meanwhile, for marketing directors, measurement can be a double-edged sword. Thorough and valid assessments may prove the success and value of a marketing program, but they can also reveal weaknesses. Marketing directors who view such information as a threat instead of an opportunity for improvement may defensively cloak themselves in estimates and unproven assumptions.
Step 4: Repeat
The scientific method is, in a way, a never-ending cycle that does not stop once data from experiments has been collected, analyzed, and interpreted. A theory does not gain widespread acceptance until the results are replicated through retesting, and a disproven hypothesis sends scientists back to the drawing board to develop another idea. In the business world, by contrast, the lack of robust marketing measurement data often leaves companies with little to build on in subsequent cycles and at risk of stagnating at a level of less-than-optimal results. Therefore, using a variation of the scientific method to analyze the effectiveness of marketing activity is critical.