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Measuring Business

Marketing Consultant Report: “Measuring Marketing”

Executive Summary

Today’s business environment is categorised by increasing competition, rising costs of manufacture, continued corporate pressures to reduce costs, and even other external influences such as governmental restrictions or trade complications. These internal and external pressures create an operating environment which is riddled with chaos and often quite difficult to predict. Because of these factors, businesses which market a final product must create some sort of competent system by which to measure whether current marketing strategies are meeting with expectations and fall within budgetary constraints. This process is referred to as measuring marketing, or the process of assessing all factors which drive sales volumes and working to correct or complement these issues through various products positioning strategies, consumer-oriented research data collection and assessment as well as creating a positive public image for the firm. This project examines the professional viewpoint of various marketing theorists and professionals in order to provide a proposed best practice template by which today’s marketers can assess their operating environment and create appropriate, revenue-building marketing strategies. Research uncovered a four step model for marketing measurement and offers the rationale behind the proposed model.

1.0 Introduction

The purpose of a business is to attract and retain customers without sacrificing total company profitability and without eroding short- and long-term company performance. However, in order to accomplish this, a company must be equipped to produce a product that people actually want and under conditions which are deemed attractive by the buying consumers (Mariotti, 2002: 65). In many respects, these are the fundamental premises of modern marketing efforts as a company utilises creative advertising and promotion to build a positive perception of product and company quality in the minds of consumers. Measuring whether current marketing strategies are completely in-line with consumer preferences, lifestyle and values is a primary business function and should receive considerable scrutiny in an organisation which desires to be both flexible and adaptive to changing consumer preferences in various marketplaces.

It was important to this study to identify the nature of modern marketing efforts as they are related to the consumer as it is often the end buyer who manages to exert the largest pressures in relation to how a company markets its products. If the product is perceived as being of no significant value to consumers, they will likely pass up this particular offering in favour of competitor products. With the recognition in mind that today’s consumers fluctuate rather inconsistently, it is a likely assessment that current marketing strategies in a business will require either minor or massive changes to strategy in the event that a product has failed to satisfy or delight the end consumer. Thus, in relation to consumer influences on total company sales volumes, it becomes imperative to measure the impact of marketing efforts on capturing the positive attention of a company’s desired consumer audiences.

Medium- and large-scale business organisations which maintain expense budgets for intensive marketing efforts eventually reach a stage in which appropriate measurement in relation to marketing effectiveness must be considered. For instance, the marketing organisation must ask itself whether consumer-generated revenues are meeting expected strategic targets or whether supply chain necessities are creating significant cost issues in relation to the distribution of product. Essentially, a company befitting the medium to large business profile must ensure that all efforts designed to promote its end product are completely congruent with senior leadership expectations and budgetary review. A recent survey targeted at over 1,000 Chief Marketing Officers (CMOs) in technology firms maintaining revenues of over £400 billion indicated that though nearly 70 percent of respondents indicated that marketing measurement was a paramount priority, fewer than 20 percent had any form of meaningful metrics by which to perform these actions (Wreden, 2005).

Companies which maintain a formalised marketing measurement system are cited as experiencing greater performance than competitors (or other business entities) which do not sustain adequate measurement systems (Wreden; Juniper, 2001). This would tend to suggest that a contemporary business seeking information as to whether the return on marketing investment is worth the expenditure and labour invested in the activities must determine which specific elements of marketing are meeting with the most success and which should either be abandoned or redesigned to bring maximum marketing value. Theoretically, such measurement tools can include a strategic assessment of company cash flow and revenues, internal/external analysis of consumer and competitor activities and even the utilisation of appropriate consumer or employee questionnaires/surveys by which to gauge human attributes affecting marketing efforts.

Though there are a wide variety of measurement tools available for today’s marketing organisations (which will be discussed in detail in the subsequent chapter), it is becoming a rather common trend to assess whether current marketing efforts are actually in-line with strategic objectives or long-term revenue expectations related to product consumption. From most practical perspectives, marketing efforts are designed to improve the market performance of the final company product, thus increasing overall company profitability. Hence, when profits are the primary driver for forward business strategy, it is paramount to ensure that no efforts associated with marketing are returning insufficient gains or a series of financial losses.

Additionally, the process of measuring marketing does not appear to involve only assessments of internal capabilities, but should also be focused on the external environment as well. Today’s businesses are affected by a wide variety of external influences from the threat of competitor activities, current regional economic stability, and even international and domestic legalities which either complicate or enhance the process of performing business. From a marketer’s perspective, a rush of similar competitor products in the same industry might require a more aggressive research and development focus so as to outperform competitor products; as one relevant example. Further, economic disruption causing short-term consumer financial dilemmas can greatly erode profitability in regions where financial strength is limited. With this in mind, it may become crucial in the process of measuring marketing effectiveness to assess and deduce whether external forces (either controllable or uncontrollable) are impacting long-term expectations for continued sales growth and overall company profitability.

Further, in today’s challenging economic climates across the globe, there is considerable risk involved in creating a costly marketing campaign when conditions are unsure and competition is on the rise. The generic function of marketing is to provide an appropriate promotional stage for a company’s products and ensure that the final product can be produced and distributed efficiently and cost-effectively. The goal of marketing is to capture consumer attention by creating a positive connection with their unique lifestyle preferences and linking these perceptions positively to the product. This involves not only assessing what drives consumers to buy products but also measuring the steps that competition is making in the pursuit of outperforming other products on the market. However, in order to fully understand all of the elements which impact whether a product meets with high sales volumes or dismal failures, it becomes paramount to assess the entire operating environment as a marketing measurement tactic.

There may be additional rationales for why today’s marketing organisations must begin rather in-depth assessments of marketing effectiveness, however there are substantial tools and resources available to accomplish a full-scale measurement of marketing effectiveness. This report will highlight the theoretical approaches to marketing measurement in modern business as well as addressing concerns associated with the measurement process in order to determine which measurement tools are most appropriate for a medium- to large-scale organisation.

2.0 Aims and objectives

This report seeks, through secondary research, to uncover a series of best practice steps for measuring marketing effectiveness and relevance. There is a wide body of literature available on contemporary marketing efforts and how best to utilise internal and external corporate resources to ensure that elements of the marketing mix are addressed or redesigned when appropriate and how to measure their subsequent results. This project intends to add a significant contribution to the existing literature on marketing measurement whilst also providing today’s firms with a new template by which to evaluate marketing and overall company performance related to the end product.

Additionally, this research project maintains two specific objectives:

What are the most appropriate methods available for today’s mid- to large-scale

business organisations to measure marketing effectiveness?

What steps should a marketing organisation take when measurement of marketing reveals results which are incongruent to strategic or budgetary expectations?

Any business names or individual identifications have been obscured so as to fulfill

any issues of ethics or liability on behalf of the researcher in the event of any proposed, subjective assessments regarding individual or company performance. This research endeavour consulted with various academic resources, including marketing journals, business publications and academic textbooks related to the function of contemporary marketing.

Though each organisation marketing a final product will likely maintain different

strategic or budgetary guidelines, this research report maintains the ability to assist today’s marketing professionals in creating a marketing plan which is both flexible and cost-effective whilst still maintaining the ability to meet short- and long-term strategic objectives related to product sales volumes.

3.0 Literature review

Measuring marketing, it would appear, can best be described as a series of activities designed to assess the viability and appropriateness of existing marketing strategy (in terms of advertising, promotion, etc). The measurement process is undertaking an assessment of internal capabilities, compiled with external trends and influences, in order to determine which course of marketing strategy should be undertaken to provide the most superior benefit to the firm.

This chapter identifies various professional assessments regarding the process of measuring marketing whilst also providing several obstacles which can potentially hinder the measurement process. Drawing off secondary literature pertaining to marketing, this section of the report will offer tips for more effective measurement by addressing internal and external influences which either support or complicate marketing measurement.

3.1 The revenues and budgetary assessments

The introductory section of this research project briefly identified the elements involved in measuring marketing to include revenues and consumer assessments. From a profitability objective, McDonald & Keegan (1997) suggest that the first step in measuring marketing should be to fully understand the expenses associated with marketing efforts and compare them to earnings expected to be received during the specific planning timeline. For instance, in a corporate climate in which expansion or the creation of international relationships is a paramount strategy, the business and its leadership must ask whether the costs associated with marketing the product could serve to outweigh expected sales volumes, as international marketing efforts are often quite detailed and costly to the business.

The aforementioned may appear to be a rather common sense viewpoint from the marketer’s perspective, however in most businesses today total corporate budgetary restrictions will serve to greatly impact whether a planned marketing campaign is feasible from a cost perspective. Under the first step model of measuring marketing proposed by McDonald & Keegan, revenues assessment must be the primary element of the measurement process. Perhaps this can be best illustrated in the following hypothetical scenario: A medium-sized company producing technological components experiences a sudden drop in sales revenues which is completely unrelated to the regional economy or consumer behaviour changes. This hypothetical firm assesses that its current budget is ill-equipped to sustain its historical mass marketing campaigns to include television and magazine advertising. It is at this point that the business must consider whether its current marketing strategies are impacting whether or not the firm is receiving adequate product sales revenues so as to determine which specific method of promotion would be most feasible to boost sales and not strain budgets.

Essentially, using the hypothetical scenario proposed as the relevant example, the current mass marketing efforts at the technological firm are too costly and are not bringing in the expected revenues linked with short-term business strategy. Thus, a change in the scope and method by which the product is advertised becomes a necessity, thus in order to determine whether new marketing campaigns would be successful, it all begins, theoretically, with a revenues assessment. Says one marketing professional, “the real question is what marketing efforts are driving the profit growth and which are costing more than they are worth?” (Ehrlich, 2004: 2).

Another expert in marketing somewhat supports the notion of revenues assessment as the primary task of marketing measurement by suggesting that most companies actually view marketing not as a contributor to sales revenues but merely as an expense (Ehrlich, 2004: 2). Companies which operate under this marketing mentality will, during periods where profitability is low, slash marketing budgets to include labour reductions, cutting advertisement and partnerships, or eliminate sponsorships solely to reduce cost, but without the performance of an in-depth assessment which links marketing efforts to sales volumes (Ehrlich). The author suggests that such activities are, in many respects, irresponsible and inaccurate business philosophy. It is offered that firms should, instead of slashing budgets, simply redesign existing marketing strategy to best fit the consumer demographic they are attempting to reach.

Brand Strategy (2007) offers a difficulty to revenues analysis as an appropriate marketing measurement activity by suggesting that in some companies, revenues analysis is less scientific and more closely associated with astrology, a predictive and subjective domain of study. By this the author suggests that many senior managers are ill-equipped to understand the quantitative statistics represented by charts which illustrate spikes or declines in sales revenues. Thus, under this theoretical position, it would become the responsibility of the organisation to ensure that those individuals performing revenues assessment maintain the skills and specialisation to understand complex financial reports. For instance, a subordinate staff member in the marketing department would likely not be able to fulfil the requirements of an in-depth revenues analysis thus the potential to create in improper marketing strategy exists which might fall outside of budgetary guidelines.

Walker, Slater, Callaghan, Smyrnios & Johnson (2004) support the complicated necessities of revenues analysis by suggesting that corporate leaders must evaluate complex criteria such as asset availability, service-profit chain relationships, financial return on investment and shareholder equity as part of marketing measurement activities. Hence, the largest implication is that the individual performing the revenues assessment must be well-versed in how to interpret economic data or charts highlighting revenues during specific periods.

3.2 Understanding the consumers

One of the difficulties in measuring marketing involves the absolute influence of consumers, in terms of their unique preferences or shifting purchasing behaviours. Sedgwick (1999) offers that today’s marketing efforts are no longer driven by consumer socio-economic status but should appeal to personal lifestyle attributes or perceptions of consumer self identity. Through this statement, the author is suggesting that when determining new methods by which to advertise a product that consumer mentalities must be considered as a primary aspect of marketing measurement, not only from a socio-economic status.

The socio-economic status involves the level to which consumers have reached in terms of finance or even career and their tangible ability and willingness to purchase products at a particular price point (Martin, 2000). If consumers are, today, shifting away from making purchases based on socio-economic status, this would suggest that marketers must fully understand what is driving consumer behaviours prior to launching a new marketing campaign. In many respects, this comes down to product positioning, which according to Boone & Kurtz (2006) involves placing the product at a certain point within a market environment solely in the minds of the prospective buyers. For instance, positioning a product according to attributes of the product user, such as advertising that a product is completely congruent to consumer lifestyle, will appeal to their personal desire to buy the product more so than simply on price (an element of the marketing mix) alone.

Evaluating the current positioning strategy of the product is a significant element toward measuring total marketing effectiveness (Boone & Kurtz, 2007; Varey, 2002). If consumers do not feel a lifestyle connection with a particular brand, despite costly marketing efforts in terms of promotion and advertisement, the likely result will be a loss in sales volumes. To accurately assess whether a product is positioned correctly, the creation of a positioning map is often required, which is essentially a charted template showing where a particular firm fits with competitors in the same industry in terms of consumer-perceived quality, value, price, or generic product attributes (Hartford, Cross & Alaira, 2001). An example of an appropriate positioning map is illustrated in Appendices A. If initial assessments of marketing effectiveness discover drops in sales revenues at the same period where repositioning a product has occurred, this may be an indication that a new positioning strategy is required, especially if competitors have experienced far-superior sales growth with their own unique positioning strategy. The positioning map will indicate whether the company is positioned where it needs to be in relation to competition and allow a new marketing strategy to be formulated to better appeal to consumer perceptions.

Measuring the viability of current product positioning is very closely linked to segmentation strategies in terms of identifying the desired consumer markets necessary to build sales revenues. Woodburn (2006) offers that many companies fail to recognise that consumers have different needs and will respond in widely-different ways toward a particular offering. Thus, when these businesses create positioning strategies, they often are catering to only one market segment (rather than the broader consumer population necessary to achieve high sales volumes). It is suggested that companies should, instead, consider multiple positioning strategies in order to reach their full consumer market potential. For instance, television advertising can work toward positioning a product in terms of quality whilst print advertisements can catch a different consumer audience with a positioning strategy in terms of consumer lifestyle. Likely, such activities will be more costly to the firm from a budgetary perspective, however when measuring marketing efforts, it is important to recognise whether multiple positioning strategies are required in order to meet corporate sales expectations.

Additionally related to the consumer is the necessity to conduct continuous marketing research. Marketing research is a “function which links the consumer and public to the marketer through information – information used to identify and define marketing opportunities and problems” (Birn & Forsyth, 2002: 109). What the author is suggesting, in terms of measuring marketing, is that research is vital to understanding consumers and must be conducted continuously in order to give the company a firmer picture of what is driving consumer behaviours in the current time period. Questions that the company must ask itself are: Do we have a database in existence which tracks consumers online? Are we performing both quantitative or qualitative research questionnaires, interviews or focus groups to give us an accurate picture of consumer mentalities in the current market environment?

McGovern (2001) offers that many companies fail to conduct adequate consumer research and become concerned when multiple marketing efforts meet with dismal sales volumes. Companies may be trying to sell a product in a marketplace which, without warning, no longer value the importance of the product related to their lifestyle or individual preferences. Hence, without establishing some form of consumer research, it is unlikely that the company truly understands its target market behaviours and preferences and will be ill-equipped to establish new marketing ventures due to outdated or incorrect consumer information. Under this professional assessment, as a portion of marketing measurement, the consumer is the most influential external force affecting whether the product is meeting with adequate sales volumes thus there must be, through internal or external research efforts, some form of quantitative or qualitative studies conducted before launching changes to existing marketing strategy.

Siegel (2006) offers that consumers, today, are largely influenced by incentive programmes when determining a final product purchase. The author indicates that as companies try to outperform their competition many are relying on incentives, such as the buy one, get one free promotion or other similar programmes. Boone & Kurtz (2006) support this notion by offering that nearly 75 percent of consumers surveyed in a recent study targeting 2,600 random buyers indicated that they made product purchase decisions based on incentives. Hence, as an additional element of marketing measurement worthy of consideration, the company must assess whether it maintains an adequate incentive for consumers, in relation to competitor efforts, to build consumer loyalty and thus potential sales volumes. If an incentive-minded competitor is experiencing explosive gains in sales revenues when utilising similar positioning or differentiation strategies for a similar product, it may be simply a product of appealing to consumer desire for bonus or incentive programmes.

There are likely additional methodologies for understanding consumer behaviour other than the aforementioned questionnaires, interviews or focus groups, however clearly there is a need to assess what is driving current consumer attitudes prior to launching new marketing campaigns. Failure to acknowledge the consumer and create a product, promotion or advertisement designed to facilitate buyer interest and create a connection with the consumer will likely lead to costly marketing that brings inadequate return on the investment.

3.3 Product life cycle and differentiation

Wheeler & Hirsh (1999) offer that rapid changes in the technological environment, coupled with difficult-to-predict consumer behaviours and competitor efforts, have greatly served to shorten the life cycle of many products in today’s marketplace. For instance, the authors indicate that products are being more quickly matched with similar product offerings, copied, or just simply outperformed by competitor products, which have drastically shortened the expected timeframe by which a company can expect to sell its own product. Thus, when measuring marketing, it is crucial to understand the expectations of sales volumes as the product passes from initial launch to eventual maturity (or obsolescence) prior to making changes or implementing an appropriate marketing campaign associated with this product. An example of the stages of the product life cycle is available in Appendices B.

Product life cycle is not always an element considered when measuring marketing, thus creative marketing strategies designed to extend the product’s life cycle are not formulated by many businesses (McGovern). For instance, consider a firm which sells mobile telephone technology. This company may expect one to two years from launch to maturity due to changes in consumer demand for the product or new innovations created by competitor products which make mobile telephone, eventually, obsolete.

It is a likely assessment that many companies invest a considerable portion of their internal business activities toward new product development to combat competitor products, however by utilising a differentiation strategy, the product life cycle can be extended. Differentiation, by its broadest definition, involves creating the consumer perception, through creative marketing efforts, that the product maintains qualities which are quite unique from that of competitor products. Differentiation is closely linked to positioning strategy, however by illustrating the unique attributes of the product, it essentially creates consumer demand where none existed, thus extending the period by which the product achieves higher sales volumes.

Hence, it would be practical assessment that firms must measure the current expected life cycle of their product (or product lines) in order to determine whether expected sales volumes can be achieved in the time period before the product reaches eventual obsolescence on the consumer market. If assessments of product life cycle indicate that intensive product-specific marketing would not be worth the return on investment, it is not always necessary to abandon the product in favour of another new offering if a proper differentiation strategy, based on consumer knowledge, can be established.

3.4 Assessment of internal company capabilities

Another paramount concern in measuring marketing is an assessment of what is actually feasible within the company environment, in terms of maintaining an adequate staff to devote to marketing efforts and marketing measurement. Hepplewhite (2006) places significant emphasis on internal creativity and labour talent necessary to accurately measure marketing and create new strategies in the event of marketing failures. If a business is facing a stand-still in regards to creating new marketing campaigns, the author suggests creating an idea-friendly environment in which all members of staff maintain the ability to offer suggestions on how best to improve product performance on the consumer market. Within an organisation where budgets are strained in relation to payroll, hiring additional staff members to focus on intensive marketing is unrealistic, however there is a significant need for creativity in order to remain competitive as a marketing organisation. Thus, when measuring marketing effectiveness determines insufficient company resources to create marketing innovation, creating a culture where ideas-generation, from all staff members, is rewarded and embraced creates a much larger pool of ideas without sacrificing payroll budgets. If new ideas and innovation are key elements to a successful series of marketing campaigns, this is an element of measuring marketing which cannot be ignored or otherwise dismissed.

3.5 Understanding the external environment

The SWOT analysis, an acronym for strengths, weaknesses, opportunities and threats, is an important element of measuring marketing as a business must come to understand not only its internal capabilities but the external forces which exert pressure on whether marketing efforts meet with success. Grimmer, Hourston, Haigh & Gale (2007) offer that a wide majority of British brands, today, have experienced significant success in comparison to the rest of the developed world. The authors actually indicate that British brands are so successful that foreign firms desire to buy them up (Grimmer et al, 2007: 24).

It is paramount to recognise that the marketplace in the United Kingdom is characterised by high brand successes and appeals to foreign investors because of their successes, which is an aspect of measuring marketing involving benchmarking. O’Sullivan (2007) offers that many firms do not actively employ a comparative analysis of competitor activities, thus they are not aware of certain benchmarks which a business can apply to its own marketing strategies. For instance, of one particular competitor in the similar industry has experienced unprecedented consumer loyalty due simply to print promotional literature, it would be appropriate for today’s companies to assess why these print ads are so successful in comparison to their own firm. Such an analysis may uncover that the competitor recognised specific consumer behaviours previously unidentified by other competitors or it may illustrate that celebrities (as another example) should be utilised to capture consumer attention. In any event, when measuring marketing, it is crucial to identify the strengths and weaknesses of competitor marketing efforts and, when successes are identified, use these as benchmarks to guide forward marketing strategies.

Elements of supply chain are often dismissed in marketing measurement simply because they are so closely associated with the firm’s budget for operations. Raw materials procurement costs, as one example, will impact the firm’s ability to capitalise on high profitability (from a cost of goods sold perspective) thus these aspects must be considered in marketing budgets and as a tool for marketing measurement. The delivery and receipt of goods, along with the labour associated to perform all aspects of product creation and internal handling, must all be considered as costs which may potentially outweigh marketing effectiveness.

Consider the following scenario: A marketing professional within a company creates a new and innovative marketing strategy that is within budget guidelines. The original assessment considered the costs of raw materials, labour, research and development as well as the costs of print and television advertisements. However, without assessing aspects such as logistics for product delivery or the operating costs of storing finished products in any variety of warehousing environments, is there a guarantee that this new marketing effort will actually fall within budget guidelines? Hence, all internal and external costs associated with the product must be considered as part of a strategic assessment of operating costs prior to launching a full-scale marketing campaign.

It was important to this study to highlight the aforementioned hypothetical scenario as it clearly illustrates that there are a wide variety of operating costs, not necessarily considered from the marketer’s perspective, that must be measured in order to create a fully balanced budget-friendly marketing initiative.

3.6 The online environment

Each year, with the advancement of web-based technologies, more and more consumers in both developed and less-developed nations are gaining access to the web, which is providing increased marketing visibility to today’s companies (Siegel). Not only does the online environment create new sales opportunities, but also for establishing marketing research which can be maintained at a low cost by incorporating such research right into an interactive website (Cerasale & Stone, 2004). Further, according to one reputable agency, the “key to marketing effectiveness is knowing who is responding to marketing transactions and how they are using the services/products that are promoted” (The Advisory Board Company, 2003: 6). As such, the online environment provides significant opportunities for gaining consumer information and reaching a broader target market; perhaps internationally.

Despite the importance of the online sales environment, many companies measure the effectiveness of their online marketing presence incorrectly in relation to creating a web presence. Sweeney (2005) offers that having a website and using the web to market are two distinctly different methodologies. The author characterises a website as merely a compilation of various images, files and documents made public to Internet users, which is often the extent to which a company considers itself fully online marketable. However, a fully developed website designed to facilitate more effective marketing should be designed to meet strategic aims and be developed with the target consumer audience in mind (Sweeney).

Website marketing, it would appear, is crucial in the process of measuring marketing as a company must beg the question as to whether it is attracting enough consumers to boost revenue without using the web as a viable marketing alternative. If current, traditional marketing efforts (in terms of advertising and promotion) are failing to meet sales expectations, website presence and intensive online marketing should be considered as low-cost methods of expanding the business.

Despite the assessment of whether to proceed aggressively online, Bashford (2006) offers a significant drawback to marketing in this fashion in terms of costs associated with converting browsers to customers. For instance, the costs of maintaining a consumer-oriented database, along with web developers to routinely adapt or improve the website, as well as elements of online distribution must be considered as costs associated with type of web-based marketing venture.

Essentially, in terms of measuring marketing, companies may turn toward the Internet as a means of drawing additional customers, but fail to recognise that maintaining such an online presence can be much more complicated than originally expected in terms of overall site maintenance and using the appropriate terminology or eye-catching graphics to draw customers. Thus, measuring marketing online must track what consumers actually do when they are browsing through company web pages and what is drawing them to make purchases. In many respects, this appears to be a time-consuming process that can take months (Bashford) of assessment and exploration through a variety of database-generated reports in the pursuit of locating a specific trend in consumer behaviours. However, when a company is seeking expansion or sales growth, as part of measuring marketing, the online environment creates an ideal opportunity for firms which understand how to develop an appropriate website and build it with the consumer in mind. Failure to meet consumer expectations will likely create a costly online presence which costs far outweigh the gains of increased sales revenues.

3.7 When it is determined a failure

In the event of failure to satisfy complex consumer attributes or otherwise create a successful marketing campaign, there are several theoretical steps which can be accomplished to measure which elements of strategy have failed. Boone & Kurtz (2007) offer a relatively unique methodology of satisfying consumers by referring to psychographic segmentation, rather than demographic, as a means to create a connection with consumer lifestyles. Under the VALS2 Network, a model which divides a consumer population into groups with similar psychological characteristics and values, there are eight specific consumer profiles. Some of these include strivers, who are image-conscious and carry high credit balances as well as the believers who are more traditional, family-oriented, and watch television more than the average person (Boone & Kurtz). The VALS2 model was designed to offer a snapshot, based on years of consumer research, of what specific consumers value which specific lifestyle elements. Measuring marketing effectiveness in terms of identifying the most appropriate target market involves assessing whether the firm can capitalise on human personality. For instance, it would make little rational sense to establish a marketing campaign based on print literature for the VALS2 believer group who are large television viewers.

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Though the aforementioned scenario is closely linked with understanding consumer behaviours and lifestyle preferences, it is important to recognise that total marketing failures might actually be attributable to failing to identify with consumer needs and requires simply a shift from demographic segmentation to psychographic segmentation. In many respects, it would appear that the VALS2 Network should be considered a viable marketing measurement tool in the event of failure to reach an appropriate target audience or delight their targeted consumer.

3.8 Chapter summary

It would be relatively impossible to highlight all of the potential tools and initiatives available for today’s marketers to measure marketing effectiveness, however this chapter has illustrated a variety of internal and external influences which must be considered prior to launching a new marketing campaign or radical changes to existing marketing strategy. This chapter identified the necessity of budgetary review in terms of identifying all of the potential operating costs (or specialised marketing costs) which will impact whether the marketing campaign is a success in terms of revenue volumes and overall profitability.

Additionally, this chapter identified the influence of consumer preferences and modern buying behaviours as elements which must be considered when measuring marketing effectiveness as well as external influences, the modern online environment, assessing internal capabilities and understanding methodologies to extend the product life cycle. All of these factors, according to professionals in the study of marketing, are closely associated with whether a marketing strategy will meet with success or failure. The following chapter will analyse these viewpoints drawn from secondary literature in order to interpret their overall effectiveness and appropriateness in contemporary companies which market products.

4.0 Discussion and analysis

This project, in its exploratory approach to research, sought to uncover which methods are most appropriate for mid- to large-scale business organisations to measure marketing effectiveness. Additionally, the project sought to pursue potential steps which can be taken in the event of poor marketing results. The review of literature uncovered several practical viewpoints as well as several unexpected, professional determinations related to measuring marketing.

Primarily, it appears that understanding the current and future financial position of the firm is crucial as a foundational step in the proposed measuring marketing model. Chapter Three identified several theorist perspectives in support of in-depth revenues and budgetary guidelines by identifying how closely inter-linked expectations for profitability actually are in comparison to marketing objectives and their expected outcomes. The main question, it would appear, that a firm and its leadership must propose is whether current marketing strategy is congruent with budgetary expectations prior to making changes or launching a new marketing campaign.

Interestingly, Ehrlich proposed, in Chapter Three, that many companies view marketing primarily as an expense rather than as a tool for building or sustaining revenues, thus firms will often slash marketing budgets in the event of periods of diminished sales volumes. From any practical perspective, marketing is the primary driver for increased sales revenues as it tends to increase product and company visibility and reach a broader target audience. Slashing marketing budgets for the sake of very short-term cost reduction does not appear to be a viable strategy as an outcome of measuring revenues and cash position. Such efforts limit a firm in relation to expanding their brand presence in the consumer marketplace and will likely only serve to diminish sales volumes further.

Ehrlich further proposed that eliminating partnerships and sponsorships are common elements of marketing which are slashed when concerns over cost are raised at the executive level. However, there is a wide body of literature in existence which identifies the large-scale importance of relationship marketing and public relations for building a positive brand identity or generic corporate image (Boone & Kurtz, 2006; Nickels, McHugh & McHugh, 2005). Under the public relations model, there is significant pressure being exerted on companies by external forces (such as shareholders and stakeholders) to comply with social demand for corporate social responsibility (CSR). Thus, many companies issue press releases during periods of strategic importance or establish co-branding activities designed to utilise two powerful brand names on a single product to lure consumers and provide consumers with perceptions of trust. From a marketing measurement perspective, sacrificing potential positive public relations by slashing temporary marketing sponsorships and partnerships would appear to be undermining positive public relations. Hence, though budgetary guidelines may dictate the necessity to make changes to existing marketing strategy, the most appropriate assessment is that areas outside of public relations-building should be considered first when slashing marketing budgets.

Additionally, Walker et al proposed the internal difficulty faced by today’s firms when measuring marketing, especially in terms of revenues assessment, in relation to staff aptitudes related to assessing financial documentation. Executive leaders face significant pressure from shareholders or other governing bodies to make strategic decisions which best benefit the company, thus in terms of workload, executives are likely inundated with complex decision-making. It would be a reasonable assumption that executive leaders do, indeed, maintain the skills necessary to assess financial reports as they must rely on these figures to create a workable strategic position for the firm. However, when lower-tier marketing representatives begin assessing areas of new marketing strategy which might erode profitability, they are likely ill-equipped to handle this aspect of marketing measurement unless they maintain specialised skill in finance or accounting. This creates a potential scenario in which an effective marketing campaign should not be formulated with executive-level scrutiny, which may be unrealistic in a real-life business environment due to the many demands on senior leaders.

Outside of revenues assessment, Chapter Three further identified the absolute importance of connecting with and understanding the characteristics of a firm’s desired target audiences. Most interesting to this study was Sedgwick’s acknowledgement that consumers are driven less by socio-economic factors but more by personal lifestyle and individual value systems. Most marketing literature incorporates the socio-economic as a viable element of adapting to consumer behaviours, however it would seem that with the advance of tools such as the VALS2 Network (the psychographic segmentation template) the socio-economic may be an element of consumer attributes which is being phased out of the marketing environment. The VALS2 theory of psychographic segmentation would appear to support that notion that some consumers will actually step outside of their socio-economic constraints and make costly purchases if the consumer feels that the product is being marketed in a method that is congruent to personal lifestyle. This would tend to suggest that when measuring total marketing effectiveness, the socio-economic status of consumers does not necessarily have to be the paramount aspect of consumer behaviour in modern marketing. Rather, utilising marketing research data, online database tracking tools or other instruments can be utilised to fully understand consumers and position the product according to their unique lifestyle preferences.

The consumer and the positioning strategy must be assessed for congruency as they appear to be very closely linked together. Chapter Three determined that product positioning may be the most paramount aspect of marketing measurement which must be assessed prior to moving forward with changes to existing marketing strategy. If consumers are not buying into marketing attempts to emphasise price or quality differences between competitor products, it is crucial to understand what specifically drives the target markets and change positioning strategies to best befit their needs. The marketing measurement tools available for this process appear to include marketing research instruments or an appropriate series of focus groups; when applicable.

It would appear that product positioning and differentiation are quite crucial to the success of a marketing campaign, regardless of whether a product maintains a limited life cycle or an extended period of sales growth prior to reaching obsolescence. There is little doubt that failure to understand consumers will lead to inaccurate positioning strategies, thus driving down total marketing effectiveness and will likely require reassessment short-term.

Internal company capabilities, also, must be assessed when determining how best to market a product. Labour issues, the ability to procure necessary raw materials for production and any other variety of internal activities appear to greatly impact marketing successes. Specifically from a labour perspective, one need only review today’s media to witness how organisations cut staff expenditures to ride out periods of decreased profitability. This is a tangible reality of modern business. Thus, when measuring marketing and it is determined that a more intensive, costly marketing effort might be required to turn around slumping product sales, is it really a quality philosophy to cut labour as a short-term cost-savings plan? The literature would tend to suggest that such activities can be appropriate so long as the organisation maintains an open environment in which differing staff suggestions can be taken into consideration for existing or future marketing efforts. Because this creates a larger pool of ideas from a more diverse subordinate culture, the ability to utilise staff reductions rather than slashing marketing budgets in the event of poor marketing performance appears viable. As it was already determined that eliminating marketing budgets in the event of poor sales performance is a poor strategy, at least it would appear that modern businesses can still create an effective marketing campaign even in the event of labour reductions.

Quite outside of internal capabilities, the external environment is a significant influence on whether marketing efforts meet with success or failure. Grimmer et al described the United Kingdom marketplace as being both stable and attractive to foreign investors looking to swallow up British brands. It was important to this study, in relation to the concept of measuring marketing, to recognise that it appears a business must understand the economic conditions of the environment in which it operates prior to making changes to existing marketing strategy. For instance, in a real-world environment, a domestic business which has experienced significant successes in the UK may automatically expect similar results in another European nation. Hence, this firm might use the same positioning strategies within another social culture that turn out to be completely incongruent with their unique lifestyle needs and values, ultimately leading to total marketing failure in this new business region. This illustrates the stern importance of understanding the economic and social conditions of potential marketplaces prior to launching a full-scale international marketing campaign. As a portion of measuring marketing, regional economic strengths and weaknesses must be identified through research or assessment of competitor successes in similar market environments.

Of considerable interest to this study was Chapter Three’s recognition of the supply chain as being an often under-researched element of creating marketing strategy. As many aspects of the supply chain, from purchasing to final product distribution, are written into expense budgets as operating expenses rather than marketing expenses. This represents somewhat of an incongruence between corporate expectations for maintaining a low cost operating budget whilst still maintaining an appropriate marketing strategy designed to best-suit consumer needs. If the company does not provide to the marketing staff/group adequate financial reporting related to operating expenses, it would appear that a viable marketing strategy cannot be created as it will not incorporate all of the operating costs associated with the end product. This would suggest somewhat of a cooperative attitude between leadership which controls access to financial reporting data as well as marketing staff members who will require this economic data to make an appropriate marketing strategy. In any event, operating budgets and revenues assessment appear to be closely linked in marketing measurement as a successful strategy starts with understanding costs.

Because of the high volume of consumers maintaining access to web-based technologies, this study identified the importance of utilising technology and the Internet as means to successfully measure whether marketing efforts have succeeded or met with dismal failures. Chapter Three proposed the creation of (or assessment of pre-existing) databases used to measure consumer behaviours when browsing online or other demographic trend information related to consumers. This touches on understanding consumers again, as a broad external influence to marketing strategy, however utilising technological advances to gain information which was previously only attainable through field research studies and focus groups. Clearly, if a company maintains no such database and does not perform routine assessments of current consumer attributes and behaviours, marketing measurement has uncovered a significant divide between internal knowledge and appropriate marketing strategy formulation.

Additionally, Sweeney offered the importance of developing a fully functional web presence consisting of more than just images and publicised documents, but creating a site that is developed specifically with their desired consumer preferences in mind. It would likely not be difficult to locate a significant volume of company successes for those businesses which utilise the Internet or other web-based technologies as viable marketing tools, which is supported by the notion of annual increases in global consumer usage of the Internet. Thus, as a portion of marketing measurement, it appears that a company must determine whether its traditional marketing efforts maintain the appropriate balance to improve consumer-generated revenues or whether it has become time to take the company into the Internet environment.

However, despite the many laurels of assessing the Internet as a viable marketing tool, Chapter Three further suggested that there are significant costs associated with developing and transforming a web presence. These costs were identified as the costs of converting web browsers to customers and maintaining an appropriate database which can generate reports on consumer behaviours online. It is a likely assessment that such web-based development would also require the assistance of skilled professionals in web development and software applications, thus imposing further budgetary costs on a firm which cannot sustain such an electronic database due to limited expertise in technical support matters. Thus, when measuring marketing, it would appear that the company must consider the expected sales revenues from maintaining a product sales website and determine whether the risks of capturing a different target audience might potentially outweigh the costs of website development and maintenance.

When marketing efforts are assessed fully and it has been determined that current strategies have failed, Chapter Three again supports the importance of psychographic segmentation over demographic segmentation. The VALS2 model appears to be a quality option for measuring marketing as it categorises not only specific consumer attributes by lifestyle preference, but post-study research uncovered that it also represents various international cultures which are most likely to fit in these categories (Boone & Kurtz, 2006). Thus, the VALS2 template not only theoretically serves domestic needs in relation to understanding consumers, but can also act as a viable tool for reaching international markets. It might then be determined that when measuring marketing, psychographic segmentation as categorised by the VALS2 Network should be utilised as a template to determine whether the company fully understands its desired consumer audiences or whether different VALS2 lifestyle trends afford the potential opportunity to reposition the product to reach an entirely different target audience. Essentially, it might be said that psychographic profiling is a strategic tool for measuring marketing as it lays the foundation for the most appropriate differentiation strategy or positioning strategy to receive the most consumer loyalty or increased sales volumes. As such, the VALS2 template can be utilised as an instrument of comparison to assess whether current positioning tactics truly befit the needs of a firm’s customers from a lifestyle perspective.

All of the aforementioned elements of measuring marketing appear to be largely inter-linked, as recognising budget guidelines and internal capabilities create a snapshot of what the company is actually able to accomplish realistically. From a practical perspective, this initial assessment will likely refute a variety of marketing options initially as they might be completely incompatible with production capability or overall operating costs. This suggests that all divisions of a company must work cooperatively to fully understand the strengths and limitations of the firm in terms of launching a successful marketing campaign. Without this cooperation, the implication exists that elements related to budget or internal capacity will be over-looked in the marketing budget plan and may erode strategic objectives related to profitability over either the short- or long-term. Many business professionals will likely herald the importance of teamworking in modern companies as a tool for creating more quality business outputs and measuring marketing appears to be really no different as there are a wide variety of elements which must be considered which are not necessarily within the jurisdiction of the marketing department.

Benchmarking and assessing the strengths and weaknesses of competitor products, also, appears to be a highly important element to measuring marketing. As there does not appear to be any definitive marketing model which can be universally integrated into firms and achieve similar industry successes, it is important to periodically address whether current competitor activities have met with sizeable triumphs. Businesses today remain focused on maintaining methodologies designed to outperform competition and sustain a competitive edge, which are notable aspects of modern business philosophy. However, benchmarking as a tool for measuring marketing effectiveness appears to be under-utilised as a strategic research template. Benchmarking may theoretically discover that a competitor achieved high sales volumes because of a new focus on trade show establishment rather than continuing traditional marketing efforts in the form of print and television advertisements. If the firm conducting this competitor research realises they, too, have utilised similar traditional marketing efforts and met with similar failures, benchmarking has created the opportunity to develop similar trade shows in order to sustain competitive edge and reach their desired consumer audiences. Hence, it is somewhat surprising that today’s companies do not utilise benchmarking as a common tool for measuring marketing effectiveness.

All of the activities and proposals highlighted in Chapter Three were designed fulfil the objectives outlined in the introductory portions of this research project. Many of the activities appear to be relatively common-place, supported by multiple theorist and professional assessments, thus making them appear quite viable for marketing measurement and subsequent changes to marketing efforts within modern firms. The following chapter highlights a series of recommendations inspired by the results of this research project and will be outlined as a proposed best practice model for marketing measurement.

5.0 Recommendations

Several recommendations for modern marketers have been developed based on the review of secondary literature supporting this research study. Primarily, revenues and cash flow assessments (as well as reviewing other corporate economic data) must be assessed by competent and skilled individuals who are educated in scrutinising and making determinations based on past, current and future financial performance. In an organisation where senior leadership is largely unavailable due to a variety of executive obligations, there must be an individual or training programme available to provide the support needed to fully engage a competent financial analysis. Marketing professionals may not be privy to certain strategic decisions made over a particular time period, thus a marketing subordinate staff member may not recognise that revenues dropped due to, as one potential example, tariff restrictions imposed. An unskilled financial analyst may simply recognise a drop in sales, make a false determination as to what caused the drop in profitability, and then create an insufficient marketing campaign based on misinterpreted economic data.

The aforementioned scenario may appear to be a rather outlandish example, however because so many elements of marketing involve financial cost to the business, it appears that training or counselling from a trained financial professional is required to ensure an adequate and appropriate position for the company. Hence, it is recommended that all firms perform a strategic assessment of internal staff capabilities related to financial analysis and provide whatever support is logical based on budget guidelines or training capabilities. A company that is driven by expectations for profitability will rely on consumer sales revenues to remain competitive, thus the establishment of inaccurate marketing strategies based on ill-conceived financial assessment will only erode the stability and longevity of the firm. Thus, based on professional consensus and adequate support, revenues assessment can be deemed the first step of the proposed best practice model for marketing measurement.

Clearly, there are a wide variety of instruments available for firms desiring to measure marketing effectiveness in relation to understanding consumer behaviours and lifestyle preferences. The pre-established VALS2 template as well as qualitative and quantitative research instruments appear to be quality research opportunities so as to fully relate with consumers in the modern marketplace. It would appear that the days of making business assumptions about consumers socio-economic status is being phased out in exchange for marketing products with a focus on creating lifestyle connections. Thus, a television manufacturer, as one relevant example, should not automatically assume that a working class individual would not be capable or willing to buy a £4,000 television set, hence they are not considered viable target markets. However, with clever positioning and the ability to create a consumer connection with, as one example, the strivers who value television viewing and are willing to carry large credit balances, this hypothetical technology manufacturer may have captured a completely different market opportunity. With this in mind, it is highly recommended that a company assess which types of consumers (from both a demographic and psychographic perspective) make up their current customer base and, if necessary, begin a niche marketing approach to capture the attention of different markets based on lifestyle connection. This recommendation could, of course, be adjusted to fit any of the eight existing psychographic profiles and tailoured to meet the needs of individual marketing organisations. Under this recommendation, the process of measuring marketing must be continuous to determine whether a new psychographic segmentation strategy is required or whether the product has simply reached the end of its life cycle on the consumer marketplace.

Additionally, it is recommended that today’s marketing organisations carefully scrutinise the importance of conducting appropriate marketing research. There appears to be a rather universal consensus from theorists and marketing professionals which highlight the absolute importance of ongoing consumer-oriented research and assessment. Post-study research uncovered a recent scenario with a well-known clothing brand (for the sake of this study the name will remain anonymous) and its company leadership who was chastised for making marketing decisions based on virtually zero research data (Kleiner, 2004). Using only the CEOs personal instinct about consumer preferences as a guide to strategy formation rather than solid marketing research, the company experienced tremendous sales losses during this period. In short order, this CEO was removed from his position and replaced with a more research-oriented chief executive officer who understood the importance of fully understanding consumer behaviours. Eventually, the firm recovered from its losses and integrated a complicated system of marketing research to include surveys, focus groups and other observational activities.

The aforementioned scenario illustrates the stern importance of utilising marketing data and establishing the resources necessary to track data and generate reports which are relevant for marketing measurement. Though Chapter Three discussed the many costs of establishing and maintaining such an electronic database, using the scenario regarding the instinctive clothing CEO as the appropriate example, clearly any changes based on marketing strategy without consulting or gathering research data is a tremendous risk to the business both short- and long-term. Hence, it is recommended that thorough marketing research, within budgetary guidelines, is necessary prior to launching any marketing activity designed to connect with consumers. The potential negative impact to businesses who under-emphasise the importance of marketing research will likely fail to establish a competent marketing measurement initiative and will thus make improper marketing decisions and strategies.

This project’s final recommendation to modern marketing organisations is to recognise the changing consumer preferences in relation to incentive creation as a means to generate continued sales volumes and create a loyal customer base. Chapter Three identified the buy one, get one free promotion as one relevant example of incentive programmes and also indicated that a very large majority (nearly 75 percent) of surveyed consumers made product purchases based only on various incentive influences. These are substantial, quantitative statistics which, from a practical viewpoint, should not be overlooked by today’s marketing organisations when measuring whether existing marketing could require adjustment. If the firm maintains no incentive programme or direct mailing marketing effort designed to offer loyal consumers discounted merchandise (or other similar incentives) it would appear that a company might be essentially handing customers over to their competitors which do maintain incentive marketing elements. In a scenario in which a company has witnessed large-scale competitor successes for those businesses which maintain incentive programmes but maintains little success using similar marketing strategy, it is strongly recommended that the incorporation of incentive-based marketing efforts be considered as a portion of marketing measurement. This recommendation is essentially viewing the internal capacity of the company, comparing it to competitor activities and then making appropriate marketing strategy adjustments to appeal to changing market preferences related to incentives as the motivation to purchase products.

6.0 Conclusion

All of the professional viewpoints and research-based recommendations proposed by this research project indicated a series of steps required of contemporary marketers in order to fully measure total marketing effectiveness. From the internal capabilities assessment to the external marketplace analysis, there are substantial tools available for today’s firms to accurately determine the most appropriate methodology of marketing which will be most congruent to corporate expectations.

Step One of this project’s proposed best practice model involves the revenues and financial assessments of the firm. Step Two is understanding consumer preferences and utilising both field and online research instruments to fully gauge what is driving the majority of consumer buying behaviours. Step Three is determining whether demographic positioning strategies are most viable or whether the company should take a psychographic segmentation and advertising approach to gather the largest consumer audience. This, of course, entails understanding customer motivations achieved through the research in Step Two. If the business notices opportunities to potentially target a previously unconsidered market, new positioning or differentiation strategies can be formulated as a replacement for existing strategies or as a supplement to increase market share in their unique industry. Finally, Step Four in the proposed best practice model is to determine whether the company would gather increased consumer interest by creating various incentive programmes designed to appeal to the rather modern consumer trends toward bargain-hunting. Figure 1 illustrates the new proposed best practice model for marketing measurement.

Figure 1: Best Practice Model for Marketing Measurement

The new proposed model may be fully adaptable for companies which maintain widely different product offerings and operate in diverse marketplaces, such as the potential insertion of additional steps which would best fulfil expectations for measuring total marketing effectiveness. Future researchers maintain the ability to build on this proposed model by coordinating a primary research study targeting both consumer populations and various business leaders to either refute the viability of this model or improve its design. However, the research literature has indicated that the proposed four steps in measuring marketing, if performed competently and with an intensive knowledge of marketing theory and principles, will theoretically lead to total marketing effectiveness.

This project has fulfilled its intended research objectives by identifying a series of opportunities for modern marketing organisations to better develop a system for measuring whether existing marketing efforts are meeting with expected success ratios. Clearly, despite the research literature which indicates that many aspects of internal and external business influences can be planned for through research and assessment, it is a likely implication that complex and highly-competitive business environments will maintain elements which are unforeseen and will challenge long-term marketing strategies. However, if marketers understand the basic premises behind what drives consumer behaviours, internal business capabilities, how best to position a product as well as methods to expand the life cycle of the product, this proposed four step model is designed to work as a foundation by which to measure marketing effectiveness and make changes should they be required.

In today’s marketing environments, consumer preferences may be focused around incentive programmes as a determinant of purchasing behaviour, however tomorrow these preferences may involve previously-unheard-of lifestyle demands. It is largely due to changing consumer behaviours and lifestyle preferences that marketing efforts change in relation to differentiation and positioning strategies. Additionally, since yesterday’s consumer preferences were largely based on demographic segmentation based on socio-economic status, but now customers demand incentives, this only reinforces how difficult customers are to predict. Thus, all efforts at measuring marketing in the pursuit of making the appropriate adjustments to strategy must be an ongoing process for modern businesses.

Many businesses would likely maintain a wide variety of ideas on how best to market a particular product utilising the most aggressive and publicised methods possible to accomplish sales goals and build consumer loyalty. However, the tangible reality of modern business is dictated by corporate budgetary guidelines, thus the four step process in measuring marketing provides a firm, initially, with the ability to assess finances as a preliminary measure to adjusting current marketing tactics. The evidence suggests that a marketing plan does not maintain the ability to meet with success until budget issues, from every conceivable angle, have been considered and approved.

Marketing is more than merely promotion, pricing and advertisement, it is largely associated with distribution efforts related to the supply chain, as well as many other business factors. This project did not intend to dismiss other potential opportunities, but as a limitation to this study, the ability to measure a large volume of marketing activities would have served to over-extend the intended scope of this research project. This project proposed no specific hypothesis regarding the effectiveness or failure ratios of any particular marketing activity, thus it took an exploratory approach to research to uncover commonalities in professional viewpoint regarding the measurement of marketing. Thus, as a future research opportunity, researchers can further build on this proposed four stage model through the establishment of specific research objectives designed to measure issues of distribution, third-party relationship building or any other aspect of business and marketing which was not identified in this project.

Despite any limitations to this study, clearly this proposed four stage model of marketing measurement is well-supported by professional consensus and, under the most ideal conditions, should theoretically provide today’s marketing organisations with a foundation by which to measure whether current strategies are congruent with strategic expectations or whether they should be abandoned altogether. Whatever the individual business outcome, clearly it is paramount to a competent marketing measurement initiative to understand budget, consumer motivations, positioning strategies and differentiation tactics and whether or not current or future incentive programmes will lure a broader consumer market and increase total marketing effectiveness.

The proposed four stage model would need to be incorporated into one or many real-life organisations in order to determine its viability as a proven and trusted marketing measurement model. A significant strength of the proposed model is in its flexibility as it merely, at this point in research, maintains the ability to provide a four step template by which to mould assessments of marketing effectiveness. Should this model be incorporated into a research scenario within an organisation, perhaps during a case study approach to research, and it is discovered that other crucial elements are required as a portion of marketing measurement, the model can be adapted to suit the specific needs of the business, such as inserting a well-supported Step Five or Step Six (as well as the removal of one of the proposed elements in the model) to enhance the model’s usefulness and functionality in a real-life business and marketing environment.

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Appendices A: Product Positioning Map

Source: Marketingteacher.com. (2007).

The positioning map above utilises the example of an automotive marketplace, highlighting where each individual carmaker fits within the positioning map in terms of price and fuel economy. In a retail environment, this positioning map can be adjusted to represent issues of quality and consumer perceptions of price or value in exchange for fuel economy which was only appropriate for this particular example. This illustrates how a positioning map can be adjustable and adaptable for the specific positioning needs and assessment criteria of a marketing organisation.

Appendices B:

Product Life Cycle Chart

Source: Tyner Blaine. (2007). ‘Product Life Cycle and the ROI of Agile Development’.

Retrieved 4 Mar 2008 from http://tynerblain.com/blog/2007/02/27/agile-development-roi-1/

The product life cycle diagram illustrated above shows the various stages by which a product is expected to move until it eventually reaches obsolescence or the inevitable decline in product sales. The chart illustrates the development period, followed by initial introduction where sales volumes begin to steadily grow. During Growth and Maturity stages, the product has usually been on the market for a significant period of time and the appropriate brand awareness and consumer loyalties have been created (or are attempting to be created by marketers). The decline stage is where the product is perceived as having minimal usage for the consumers’ lifestyles or has simply outlived its expected lifespan. After decline, most companies either scrap the product in favour of a new offering or, in an ideal situation, use creative marketing to continue to stretch the life potential of the new product.

Appendices C:

The VALS2 Network Template for Psychographic Profiling

Source: Bournmouth University. (2006). http://media3.bournemouth.ac.uk/marketing/07segmentation/04strategies.html

The VALS2 Diagram illustrates the various psychographic profiles befitting most consumers. The advantages of this diagram are that it provides a broader picture of consumer lifestyles and cultural preferences by nationality and can be utilised to create a more accurate customer profile based on where the consumers fit within the categories proposed by the diagram.

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