The Art of the Marketing Scorecard - Beckon, Inc. · THE ART OF THE MARKETING SCORECARD “How’s...

USING DATA TO TELL THE STORY OF OMNICHANNEL MARKETING PERFORMANCE

THE ART OF THE MARKETING SCORECARD

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CONTENTS

THE ART OF THE MARKETING SCORECARD 1

WHAT IS A MARKETING SCORECARD? 2

THE BENEFITS OF MARKETING SCORECARDS 3

DESIGNING A MARKETING SCORECARD 7

KEY SCORECARD COMPONENTS 15

BEST PRACTICES FOR MARKETING SCORECARDS 17

WHERE TO START? DEEP OR WIDE? 19

1


THE ART OF THE MARKETING SCORECARD

“How’s marketing performing?” It’s a question marketing leaders get asked all

the time. But it’s not always easy to answer. Marketing has so many channels,

so many vendors and tools in the mix, so many executions and campaigns

going at once, how can we possibly summarize all that’s happening, why we’re

doing it, and what it all means?

And yet we can’t get away with saying, “Well, it’s complex.” That doesn’t satisfy

CEOs and CFOs. Management wants quick-hitting summaries. But more, it

wants context. How are we performing compared to where we thought we’d

be? How about compared to last week? Last year? Compared to a similar

campaign?

Enter the marketing scorecard—a powerful tool for delivering visibility into

overall marketing performance with context.

In this paper we’ll cover:

• What is a marketing scorecard?

• The benefits of marketing scorecards.

• Scorecard design options—how to choose the right framework(s) for your

marketing team.

• Choosing and organizing scorecard components—objectives, metrics, KPIs

and how they all fit together.

• What’s the best way to get started?

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WHAT IS A MARKETING SCORECARD?

A marketing scorecard is a strategic planning and management tool that takes

its cues from the balanced scorecard system. Developed by Robert Kaplan

and David Norton more than 20 years ago (and used in organizations around

the world ever since), the balanced scorecard is a data-driven performance

measurement system that aligns business activities to business strategy and

allows teams to monitor and improve the business over time.

A marketing scorecard, then, is a data-driven marketing performance

measurement system that aligns marketing activities to business strategy and

allows teams to monitor and improve their marketing over time.

Marketing scorecards also have roots in Six Sigma—a process-improvement

methodology developed by Motorola in 1986 and famously adopted by Jack

Welch of General Electric a decade later. How does Six Sigma dovetail with

marketing? Well, to start, Six Sigma is a disciplined, data-driven approach for

eliminating defects and achieving stable, predictable results in manufacturing.

For marketers, the “defects” we’d like to reduce are suboptimal marketing

outcomes like low conversion rates, poor paid-to-earned media ratios, flagging

customer loyalty and expensive customer acquisition tactics.

Further, Six Sigma holds that all processes have cause-and-effect relationships

that can be measured, analyzed, controlled and improved in order to drive

higher output quality—or higher ROI, in the case of marketing.

Lastly, the Six Sigma philosophy, brought to the marketing arena, says that

great marketing and great brands are not built by virtue of a single decision (a

one-time annual budget allocation across channels, say), but by the millions of

ongoing small decisions the extended marketing team makes. When we track,

measure and optimize our marketing efforts using a tool like a scorecard, we’re

learning and improving systematically.

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THE BENEFITS OF MARKETING SCORECARDS

Like balanced scorecards and Six Sigma, marketing scorecards:

• Bind tactical metrics to a strategic framework.

• Report performance against pre-specified criteria.

• Provide context.

• Are actionable, making next steps and decisions clear.

• Align the team.

• Tell the story of success to the wider business.

Each offers transformative benefits for marketing.

SCORECARDS BIND TACTICAL METRICS TO A STRATEGIC FRAMEWORK

Marketing is incredibly fragmented these days. We market online and offline.

We do direct marketing, brand advertising and loyalty marketing. There’s an

ever-growing number of channels to market in and we have specialized teams

and tools for each. If even we marketers are sometimes overwhelmed by the

complexity and diversity of all that we do, imagine how the CEO and CFO must

feel when they’re blasted with the fire hose of marketing metrics: “We had 10

likes and three retweets and got 10 TRPs and 20,000 visits and ….” Huh?

We marketers know that what we do isn’t random—our efforts support key

business objectives and drive customers along a journey from awareness to

purchase and beyond. Marketing scorecards visually map the results of our

efforts onto a strategic framework. They show with simplicity and precision

how all the tactical stuff works together to move the needle on key business

objectives.

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SCORECARDS REPORT PERFORMANCE AGAINST PRE-SPECIFIED CRITERIA

Too often, marketing begins execution with no specific goals, KPIs or criteria by

which things should be judged. Then, long after the campaign or effort is over,

the team that executed (whether an agency or a team within the marketing

org) sifts through a pile of results and cherry-picks metrics to show off. All

kinds of crazy things get reported when it’s at the discretion of the executor—

perhaps it was an engagement campaign, but the reported metrics tout the

campaign’s powerful reach.

This erratic, after-the-fact approach creates big problems. We can’t trend. We

can’t compare. We can’t see if one thing outperformed another or was more

cost-effective. The lack of consistent reporting means we have no real basis

for future decision-making. And, the marketing department and its leadership

(that’s you!) come across as all over the map.

If, on the other hand, we build a template for a marketing scorecard and use it

for every omnichannel campaign—deciding up front the criteria by which we’ll

judge our efforts—reporting will be consistent, comparisons become possible

and best practices can be gleaned.

SCORECARDS PROVIDE CONTEXT

Management wants more than an information-dense summary of activity

metrics. It wants to see how well we’re performing now compared to where

we thought we’d be (planned vs. actual reporting). And compared to last

year (year-over-year reporting). And compared to the previous week (trend

reporting). And compared to a similar campaign (internal benchmarking or

performance vs. comparable reporting). Marketing scorecards can deliver

exactly this kind of perspective along with the data.

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SCORECARDS MAKE MARKETING DATA ACTIONABLE AND DECISIONS CLEAR

Well-designed marketing scorecards make marketing data actionable. Every

day or every week, we can look at our scorecards to see: Did the various

vehicles in our marketing mix deliver what we expected? Are we on track to

hit plan? If not, we can drill down to see what underperformed and reallocate

budget accordingly.

What’s more, the mere act of putting forth targets and tracking how well

we’re hitting them is a powerful mobilizer. Marketing for the sake of doing

marketing goes away completely. The sales function offers a great parallel.

Sales departments don’t say, “We do a bunch of activities so that we can

hopefully sell stuff.” Not at all. First, sales establishes a target for the quarter.

Then, the sales team meticulously tracks to goal using a shared reporting

mechanism, which can be anything from software like Salesforce to a hand-

drawn thermometer on the whiteboard slowly filling up with red ink. Either

way, progress to date dictates the team’s activity level—the sales team is either

scrambling or coasting based on that planned vs. actual report.

Same with the finance department. If finance is trying to control costs but

sets no expense targets, the CFO has no basis for actual decision-making.

So finance sets expense targets and continuously tracks the relevant data.

Say finance committed to keeping costs at $400k this quarter and $390k

has already been spent. When a $200k purchase order comes through for

signature in the final week of the quarter, the CFO knows precisely what action

to take (or not take in this case).

Having 1) goals and targets set up front, and 2) a monitoring system for

tracking performance makes data incredibly actionable and decisions clear.

Marketing scorecards provide both.

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SCORECARDS ALIGN THE TEAM

For most of us, marketing performance measurement is shrouded in confusion

and mystery. What metrics should we be paying attention to? How can we

tell if we’re succeeding? Are we even moving in the right direction? Marketing

scorecards create a lighthouse of certainty in a murky sea of data. They put

teams and agencies on the same page—literally—and then tell us where we are

and where we need to go.

SCORECARDS TELL THE STORY OF SUCCESS TO THE WIDER BUSINESS

Marketing scorecards are a powerful way to communicate with groups outside

marketing. Think of scorecards as marketing infographics—they reveal at a

glance how all the parts of marketing fit together into a single whole. Done

right, marketing scorecards will make people in other areas of the business say,

“Oh, that’s what marketing does! I thought you just made TV ads!”

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DESIGNING A MARKETING SCORECARD

We said above that marketing scorecards bind our tactical metrics to a

strategic framework. Specifically, the categories in the strategic framework

serve as column headers atop our scorecard and the metrics that matter slot

underneath. But what strategic frameworks should we consider?

The traditional balanced scorecard focuses on four pillars of business: finance,

the customer, business processes, and learning and growth. But marketing

scorecards are more flexible. Let’s walk through four examples of strategic

frameworks for marketing scorecards. But remember, we don’t have to pick

just one. Best practice is to develop a number of scorecards so that we can

measure and communicate our marketing effectiveness through any of these

lenses (and others) as appropriate.

FRAMEWORK 1: THE BUYER’S JOURNEY SCORECARD

Whether we’re B2B marketers or B2C marketers, whether we sell services

or soda, marketing’s job is to find new customers, get them interested in us,

encourage them to buy from us, and keep them buying more from us. That’s

pretty much the definition of marketing according to Philip Kotler, the father of

modern marketing, who said:

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Marketing’s key processes are: (1) opportunity identification, (2) new product development, (3) customer attraction and (4) customer retention and loyalty building … a company that handles all of these processes well will normally enjoy success. But when a company fails at any one of these processes, it will not survive.

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So naturally, when it comes to strategic frameworks, the buyer’s journey

(funnel) is an absolute no-brainer and a great place to start. Notice how a

buyer’s journey scorecard forces marketing teams to NOT think in terms of

execution silos (email, social, media, search, etc.) but through the lens of the

customer instead. Metrics from all the various execution channels must come

together to show how well we’re moving customers from one marketing stage

to the next.

BUYER’S JOURNEY SCORECARD

By instrumenting each stage in the journey, marketers have powerful visibility

into the mechanics and inner workings of marketing effectiveness, rather than

just tracking the traditional starting point (spend) and end point (sales). If sales

drop one quarter, how can we diagnose the problem if we don’t have granular

diagnostics all along the buyer’s journey? That’s what a buyer’s journey

scorecard delivers. Think of it as an early warning system for sales changes.

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While the concept of moving customers through a journey is commonplace in

marketing, we should spend time thinking about OUR version of the journey:

• We might choose the classic funnel stages: TOFU (top of the funnel),

MOFU (middle of the funnel) and BOFU (bottom of the funnel).

• It might be Awareness, Engagement, Sales, Upsell and Loyalty.

• A B2B marketer may look to the four R’s: Reach, Relationships, Revenue

and Reputation.

• We may want to use Forrester’s concept of marketing RaDaRs: Reach and

Depth and Relationships.

Whatever you choose, revenue needs to be in there, too. No matter whether

marketing at your organization directly drives attributable revenue or defines

itself purely as awareness and branding, always embed revenue/sales in a

buyer’s journey scorecard.

FRAMEWORK 2: THE BUSINESS OBJECTIVES SCORECARD

This scorecard tells the story of marketing’s contribution to the big business

objectives. And it does so using hard numbers CFOs and CEOs care about,

like cost per acquisition, sales growth and share of wallet. Unlike the buyer’s

journey scorecard, the headers atop a business objectives scorecard needn’t

be connected. They just need to represent the business objectives so that we

can showcase marketing’s contribution.

For example, assume the CEO set forth these objectives:

• Grow market share versus the competition.

• Build products and a business worth talking about.

• Increase sales to existing customers.

• Do more with less in order to grow more profitably.

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None of these are marketing-specific, but marketing has been explicitly or

implicitly supporting these goals all along (one would hope). So in our business

objectives scorecard, we nest under each goal the relevant marketing trend

metrics, showing exactly how marketing supports the overall business goals.

BUSINESS OBJECTIVES SCORECARD

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FRAMEWORK 3: THE MARKETING AND BRAND OBJECTIVES SCORECARD

Chances are, you or the CMO have clear goals for marketing and the brand for

the year. So why not create a scorecard around those marketing objectives?

Here’s what one might look like:

MARKETING AND BRAND OBJECTIVES SCORECARD

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FRAMEWORK 4: THE KEY CAMPAIGNS AND INITIATIVES SCORECARD

Many brands plan their marketing year around several key events or campaigns.

In B2B, it might be two big product releases per year plus the annual customer

event. In retail, it might be seasonal pushes: Back to School, Holiday and

Spring. For consumer brands it might be big sponsorships, campaigns or other

investments: the FIFA World Cup, the Doing Good campaign and the Women

in Business initiative. Scorecards allow us to easily track how well we’ve

executed on each campaign or initiative and compare how they’ve performed

against each other.

KEY CAMPAIGNS AND INITIATIVES SCORECARD

These four strategic frameworks for marketing scorecards—buyer’s journey,

business objectives, marketing and brand objectives, and key campaigns and

initiatives—are just the beginning. How about a buyer’s journey scorecard

focused only on digital channels? A social-only scorecard for key campaigns

and initiatives? The possibilities abound.

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WHAT’S MISSING FROM THE LIST?

Notice what’s NOT on the list of recommended frameworks: marketing

scorecards organized by CHANNEL!

Such a scorecard might seem logical at first. After all, if we want omnichannel

visibility, we can just make each marketing channel a column header and then

pop in the key channel-specific metrics. Right? Wrong.

MARKETING CHANNEL SCORECARD

Listing our social metrics next to our email metrics, next to our TV metrics,

next to our display metrics misses the crucial point. What’s important about

omnichannel marketing is not that we’re marketing in multiple channels, but

how all those channels work together to influence a customer. By organizing

according to the buyer’s journey, business objectives or marketing objectives

and weaving in data from all our marketing channels, we’ll paint a picture of

how all these things work together to move the needle on something much

bigger than the marketing function. This isn’t marketing for marketing’s sake.

It’s marketing to impact the business.

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Pro tip: Avoid creating a totally new marketing scorecard for each country,

campaign, brand and so on. Instead, create one template for each of these—

consistent, up-front criteria by which that particular sphere of marketing

should be judged. Then, simply toggle between instances to compare

performance apples-to-apples. For example, we can create a generic master

scorecard for campaigns, use it for each successive campaign, and then toggle

between campaigns to compare how they performed relative to each other.

Likewise, if we build scorecards for our key regions off a single, standard

template, we can cycle through those scorecards market by market, confident

that the benchmarking and trends are internally consistent.

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KEY SCORECARD COMPONENTS

Notice that while the various types of marketing scorecards tell different

stories of success, they share the same structure. Each comprises the following

components: objectives, KPIs, and volume, efficiency and effectiveness metrics.

EFFECTIVENESS

METRICS

EFFICIENCY

METRICS

VOLUME

METRICS

KPIS

OBJECTIVES

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Let’s walk through each component:

• Objectives. All marketing scorecards start with the key goals we want to

monitor and evaluate (these are our column headers). Remember to make

them SMART—Specific, Measureable, Attainable, Realistic and Timely. In

addition, consider rephrasing any dully worded objectives as questions

to enliven the business imperative. For instance, if our objective is to

“Engage” we can bring more focus by restating that as, “How effectively

and efficiently are we driving engagement?”

• Key performance indicators (KPIs). Below each objective, list the KPI—the

measure that’s the best indicator of successfully delivering against that

objective. A KPI rises above the level of a regular old metric when we

select it as the best proxy for success. Yes, we can choose two, but the

idea is to be selective. Keep the other measures as metrics.

• Metrics. These are the more complete set of performance measures by

which we’ll monitor and evaluate how well we’re meeting our objectives.

Good metrics candidates include:

• Volume metrics like impression and engagement volume, total sales

and other outcomes.

• Effectiveness metrics like awareness, engagement, engagement rates,

outcomes and conversion rates.

• Efficiency metrics like cost per impression, cost per engagement and

cost per outcome.

Reporting on marketing performance is always a tussle between “top down”

and “bottom up” approaches. Scorecards embody the top-down approach.

Having decided upon a strategy, we define objectives, then select the KPIs

and metrics that best show how well we’re delivering against those objectives.

When we start at the bottom, we tend to just arrange and rearrange the

metrics that are readily available to us, not knowing if they have any point. That

said, looking at metrics from the bottom up can also have value—namely, to

inventory all the data sources we have access to and identify what we’ve got

to work with.

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BEST PRACTICES FOR MARKETING SCORECARDS

Make them fit on one page. Marketing scorecards are for telling stories with

data, and such stories are best told clearly and concisely. A scorecard should fit

on a single screen and print on one sheet of paper.

Always provide perspective. Don’t let KPIs and metrics sit on the page with

no context. Note trends since the last period. Show performance over the

last year. Compare this campaign or effort to past campaigns and efforts that

were similar. This puts marketing reporting closer to the format of business

reporting, and will be very familiar to CEOs and CFOs.

Track planned vs. actual when possible. Not every metric we track will have

a goal. In fact, we might need to establish good baselines first before we feel

comfortable setting targets. But when we do have targets, our scorecards

should show planned versus actual. Tracking variances not only puts current

performance in context, it doubles as an early warning system—if something

isn’t tracking to target, we can jump in and take action to fix it.

Keep them continuously updated. Don’t produce marketing scorecards

with stale information. A beautiful scorecard printed once a year is useless.

Scorecards that refresh daily are best if we actually want to be optimizing our

marketing—and it’s absolutely doable with automated data intake, analysis and

visualizations. Updating scorecards weekly is the next best choice. Monthly

updates are as infrequent as we’d want to go.

Use standard templates. Don’t let each campaign report success in a unique

way. Don’t let each market have its own lens on performance. Develop a single,

consistent template for each type of marketing scorecard, and enforce its use.

This simple act makes internal benchmarking possible.

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Share them widely. Send marketing scorecards to agency partners, the

extended marketing team, company leadership and so on (in some cases

we may need to mask certain sensitive data, like revenue). One of the

breakthrough benefits of scorecards is how they get everyone on the same

page—literally.

Make them look good. Sure, we could do our marketing scorecards as funky

Excel workbooks or PowerPoint slides with the old speedometer-looking

clipart. But our scorecard is a reflection of marketing, and we’d be wise to

make them look as good as possible. After all, our scorecards will offer such

amazing, unprecedented insight into marketing’s strategy and performance

that anybody who receives one will likely forward it on to colleagues and

bosses. We have no idea how far this one page might go.

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WHERE TO START? DEEP OR WIDE?

Many marketers developing scorecards realize there’s a big question right out of

the box: Should we start by going deep or wide? Here’s how to think about it.

A deep scorecard takes a single area—one region, one brand or one part

of the funnel, for example—and slots in all the relevant metrics (spend,

marketing performance in all channels, business results, and brand and

equity outcomes). The more comprehensive our dataset, the more robust

the analyses we can perform.

Starting out with a deep marketing scorecard nets us a robust, marquee

example that will likely inspire other regions or brands to jump on board. The

downside to the deep approach is that by tackling, say, one region at a time,

we have to tackle standardization one region at a time. In other words, we

build our scorecard with data from Region No. 1. But when we roll in data

from Region No. 2 there will certainly be inconsistencies to work through. And

incorporating data from Region No. 3 will require further modifications, and so

on, until standardization generally solidifies.

The other approach is to start wide but shallow. We begin with all regions or all

brands, but ask for only a few standard metrics from each—spend, impressions

and sales, say. Some time later, when sharing data and reviewing integrated

scorecards become routine, we can start incorporating additional metrics,

thereby increasing our depth of metrics over time.

So, deep or wide? The answer depends on our organizational structure. The

wisest choice may be to follow the path of least resistance—do what’s easiest

first. If we have global responsibilities and find it easy to get a few metrics

from each country, start there. Conversely, if we have excellent access to one

brand’s data but aren’t sure how we’re going to get other brands to buy in,

then enlist that first brand as the pioneer. Make the scorecard as impressive

and comprehensive as possible so that it inspires more brands to sign on.

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The main thing is to install some form of real-time, omnichannel marketing

scorecard as soon as possible. Because once we start highlighting the data

and showcasing marketing’s impact on the business, we begin to change the

culture. It’s amazing how groups that have always withheld their data will

suddenly start sharing it. They, too, want to shine—or maybe they just don’t

want to be the last dark and dusty corner in a sunny marketing house with the

windows flung open.

ABOUT BECKON

To grow your brand, you need integrated, unbiased data and insights you

can trust. You need Beckon, The Source of Truth for Marketing™. Beckon’s

rock-solid data management and real-time marketing intelligence power

better, faster decisions that let you do more with every marketing dollar.

LET’S TALK

Want to learn more? Get in touch at [email protected]—we’d love

to connect.

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The Art of the Marketing Scorecard - Beckon, Inc. · THE ART OF THE MARKETING SCORECARD “How’s...

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