Data-Driven Marketing: The 15 Metrics Everyone in Marketing Should Know / Edition 1

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How organizations can deliver significant performance gains through strategic investment in marketing

In the new era of tight marketing budgets, no organization can continue to spend on marketing without knowing what's working and what's wasted. Data-driven marketing improves efficiency and effectiveness of marketing expenditures across the spectrum of marketing activities from branding and awareness, trail and loyalty, to new product launch and Internet marketing. Based on new research from the Kellogg School of Management, this book is a clear and convincing guide to using a more rigorous, data-driven strategic approach to deliver significant performance gains from your marketing.

  • Explains how to use data-driven marketing to deliver return on marketing investment (ROMI) in any organization
  • In-depth discussion of the fifteen key metrics every marketer should know
  • Based on original research from America's leading marketing business school, complemented by experience teaching ROMI to executives at Microsoft, DuPont, Nisan, Philips, Sony and many other firms
  • Uses data from a rigorous survey on strategic marketing performance management of 252 Fortune 1000 firms, capturing $53 billion of annual marketing spending
  • In-depth examples of how to apply the principles in small and large organizations
  • Free downloadable ROMI templates for all examples given in the book

With every department under the microscope looking for results, those who properly use data to optimize their marketing are going to come out on top every time.

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Product Details

  • ISBN-13: 9780470504543
  • Publisher: Wiley
  • Publication date: 2/8/2010
  • Edition number: 1
  • Pages: 298
  • Sales rank: 119,846
  • Product dimensions: 6.10 (w) x 9.00 (h) x 1.20 (d)

Meet the Author

Mark Jeffery is the Director of Technology Initiatives and Senior Lecturer in the Center for Research in Technology and Innovation at the Kellogg School of Management. He has more than thirty publications in management, scientific, and technology journals, and has published twenty-four original case studies with Harvard Business School Publishing. At Kellogg, he directs multiple executive programs including Strategic Data-Driven Marketing and Driving Strategic Value from IT, and teaches in custom executive programs for many organizations including Microsoft and DuPont. He is also the Managing Partner of Agile Insights LLC, a marketing and technology consultancy (

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Table of Contents




PART I Essentials 1

CHAPTER 1 The Marketing Divide: Why 80 Percent of Companies Don't Make Data-Driven Marketing Decisions—And Those Who Do Are the Leaders 3

The 15 Essential Marketing Metrics 7

Case Examples 9

Marketing Budgets: Key Differences between the Leaders and the Laggards 17

Using Marketing Metrics to Weather Difficult Economic Times 20

The First Step: Defining the Data-Driven Marketing Strategy 22

Chapter Insights 25

Case Examples: Best Buy, Porsche Turbo Cabriolet Launch, DuPont Tyvek NASCAR

CHAPTER 2 Where Do You Start? Overcoming the Five Obstacles to Data-Driven Marketing 26

Overcome Obstacle 1: Getting Started—Focus on Collecting the Right Data and Create Momentum by Scoring an Easy Win 28

Overcome Obstacle 2: Causality—Conduct Small Experiments 33

Overcome Obstacle 3: Lack of Data—Strategies for Obtaining Customer Data 35

Overcome Obstacle 4: Resources and Tools—Build the Infrastructure for Data-Driven Marketing 39

Overcome Obstacle 5: People and Change—Create a Data-Driven Marketing Culture 44

A Road Map for Implementing Data-Driven Marketing 49

Chapter Insights 51

Case Examples: Royal Bank of Canada, Walgreens, Continental Airlines, Harrah’s Entertainment

CHAPTER 3 The 10 Classical Marketing Metrics 52

Linking Marketing Activities to Metrics 53

A Balanced Scorecard for Marketing 62

Facing the B2B Measurement Challenge 67

Chapter Insights 71

Case Examples: MasterCard FIFA Sponsorship, Microsoft OEM Comarketing


CHAPTER 4 The Five Essential Nonfinancial Metrics: #1—Brand Awareness, #2—Test-Drive, #3—Churn, #4—Customer Satisfaction (CSAT), and #5—Take Rate 75

Shaping Perception: Metric #1—Brand Awareness 75

Comparative Marketing: Metric #2—Test-Drive 87

Loyalty Marketing: Metric #3—Churn 91

Customer Satisfaction: Metric #4—CSAT 96

Campaign Effectiveness: Metric #5—Take Rate 99

Chapter Insights 103

Case Examples: Philips Consumer Lifestyles, Navistar America's Greenest School, Porsche First Mile, Intel, Ray-Ban, Lexus, Dental Care Partners, DSW Shoe Warehouse Downloadable Excel Templates: Churn, Take Rate

CHAPTER 5 Show Me the ROI! The Four Essential Financial Metrics: #6—Profit, #7—Net Present Value (NPV), #8—Internal Rate of Return (IRR), and #9—Payback 104

Metric #6: Profit 105

Finance for Marketing Managers: Metrics #7—NPV, #8—IRR, and #9—Payback Defined 106

Return on Marketing Investment (ROMI) Framework for Management Decisions 115

ROMI for Sports Sponsorship 119

ROMI for a New Product Launch 122

Stress-Test the Numbers: Sensitivity Analysis 129

Chapter Insights 133

Case Examples: Sports Sponsorship and Web New Product Launch ROMI (Disguised) Downloadable Excel Templates: NPV, IRR, Payback, Campaign ROI, Sports Sponsorship ROI, New Product Launch ROI, Table Function Sensitivity Analysis, Monte Carlo Analysis

CHAPTER 6 All Customers Are Not Equal: Metric #10—Customer Lifetime Value (CLTV) 134

Metric #10—Customer Value Defined 135

The New Marketing Strategy: Value-Based Marketing 138

Balancing Short- and Long-Term Customer Profitability 146

Customer Life Cycle Management 151

Chapter Insights 154

Case Examples: Sainsbury’s, 3M, Continental Airlines, Royal Bank of Canada, Carnival Cruise Lines

Downloadable Excel Template: Customer Lifetime Value

CHAPTER 7 From Clicks to Value with Internet Marketing Metrics: #11—Cost per Click (CPC), #12—Transaction Conversion Rate (TCR), #13—Return on Ad Dollars Spent (ROA), #14—Bounce Rate, and #15—Word of Mouth (WOM) 156

CPC versus CPM: Optimizing Metric #11—CPC Is the Google Innovation 157

Optimizing Sponsored Search: Metrics #12—TCR and #13—ROA 159

How Good Is Your Web Site? Metric #14—Bounce Rate 168

Changing the Internet Search Marketing Game with Attribution Modeling 172

Beyond SEM: Internet Display Advertising Impact 176

Hypertargeting Display Advertising in Social Media 178

Metric #15—Word of Mouth (WOM) Social Media Marketing Engagement 181

Chapter Insights 186

Case Examples: Google, Air France, Opinmind, Meteor Solutions, Palm Centro, Capcom Resident Evil 5 Downloadable Excel Templates: Search Engine Marketing Metrics (CPC, CTR, TCR, Take Rate, ROA), Air France Click Data, Google ROA Impact, Bounce Rate, Word of Mouth (WOM)


CHAPTER 8 Agile Marketing: Using Near-Time Data to Improve Performance by a Factor of Five or More 189

If You Are Going to Fail, Fail Fast 190

Design for Measurement 196

Chapter Insights 200

Case Examples: Microsoft Security Guidance, DuPont Performance Alliance

CHAPTER 9 Wow, That Product Is Exactly What I Need! The Three Essential Approaches to Analytic Marketing 201

The First Essential Approach to Analytic Marketing: Propensity Modeling 202

The Second Essential Approach to Analytic Marketing: Market Basket Analysis 206

The Third Essential Approach to Analytic Marketing: Decision Trees 207

Timing Is Everything: Event-Driven Marketing Case Examples 214

The Business Case for Analytic Marketing 218

Chapter Insights 220

Case Examples: Meredith, EarthLink, DIRECTV, National Australia Bank, Ping Golf Downloadable Excel Template: Analytic Marketing ROI Downloadable SAS File: EarthLink Retention Marketing

CHAPTER 10 What's It Going to Take? Infrastructure for Data-Driven Marketing 222

Which Data Do You Really Need? 223

Do You Need to Build a Ranch House or Empire State Building Infrastructure? 225

Requirement Complexity 229

Should You Forklift or Rearchitect Data in the Enterprise Data Warehouse? 233

What We Know Can and Will Go Wrong (If You Don’t Watch Out!) 234

Harrah's Entertainment: Creating the Data-Driven Marketing Infrastructure Portfolio 237

Chapter Insights 246

Case Example: Harrah’s Entertainment

CHAPTER 11 Marketing Budgets, Technology, and Core Processes: Key Differences between the Leaders and the Laggards 247

Marketing Campaign Management: The State of the Industry 249

Research: Marketing Processes, Technology, and the Link to Firm Performance 252

B2B versus B2C Investment Portfolio Mixes: Leaders versus Laggards 256

Overcoming the Four Barriers to Professionalizing Marketing Processes 260

Upgrading Marketing Campaign Management Processes: A Three-Phased Approach 262

Lessons Learned from the Research: Complexity Requires Governance 266

The Creative X-Factor 268

Tying It All Together 271

Chapter Insights 272

Case Examples: Blendtec Viral Marketing, Nissan Qashqai New Product Launch

APPENDIX FOR INSTRUCTORS How to Use This Book to Teach Data-Driven Marketing 275



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Sort by: Showing all of 8 Customer Reviews
  • Posted February 18, 2011

    more from this reviewer

    Punchy guide to marketing metrics

    Many marketing insiders are not fans of quantitative business analysis. They prefer the creative side of the business. But in today's cost-cutting, profit-focused environment, marketers should understand the data metrics that define their results. This important book explains these utilitarian, beneficial metrics. Technology and innovation expert Mark Jeffery, writing in a disarming, first-person style, presents the case for using data. He cites companies that have applied data to drive sales and to deploy their marketing budgets more effectively. getAbstract suggests that this book could elevate the perceptions, performance and results of many non-data-oriented marketing departments, and could advance an individual marketer's career.

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  • Posted July 19, 2010

    A Must Have Book for Marketer

    As a marketing analytics professional, I find this book is more than useful for me to deepen my understanding on data-driven marketing area. Mark, as a renowned Kellogg professor, adopt a very practical way but with a very professional and insightful perspective to pin point the necessacity and importance of data-driven marketing. This book helps me to comprehend how marketers in the coporations could leverage marketing analytics to deliver more effecitive and profitable marketing result, the perspective different from what I holds as a marketing analytics advisor. What I specially like this book is because it not only addresses the issue from an high-level industry trend with fruitful business cases, but also demomstrate specific metric calculation for readers to understand analytics in a pragmatic manner. As a must-have book for marketers to understand data-driven marketing, it is also a good resource book for MBA students and professionals who want to build their expertise on marketing since the future of the marketing will be built on an analytics platform.

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  • Posted June 16, 2010

    A must have for MBA students to Experienced Professional Marketers

    This book must be purchased, read and kept on your shelf as a reference. It is very well written, very easy to follow, and very organized. The many examples "in practice" really hit home the theories and concepts. This book will not only give you the tools to measure marketing campaign results but will also give you the tools to sell your company on the fact that marketing campaign results need to be measured. There are also a few excellent chapters on measuring results of internet marketing. This book covers it all. MBA students to experienced professional marketers should have this book on their reference shelf.

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  • Posted February 15, 2010

    Jeffery is a Data Rock Star!

    Anyone that can prove data drives profits is a Data Rock Star!

    As a Marketing executive, I can understand the challenges of fusing science and art when making daily marketing decisions. Mark has done an exceptional job at articulating simple, yet thoroughly explainable, solutions for achieving successful marketing metrics. He provides an exceptional foundation of mathematical methods in driving ROI, ROAS, profitability and retention.

    Data-Driven Marketing accomplishes the one thing that is most critical when running a marketing organization: using data to drive profits. He stresses the critical relationships between business and IT and how, in concert, these two forces can truly revolutionize business results. Using enterprise customer, operational and transactional data in the 15 metrics are key. His book also points out the power of Voice of the Customer data and how its continued mining is important to driving marketing strategy. Another advantage of his metrics are their versatility: simply put...they are industry agnostic.

    Mark also does more than just lay out case after case of why these metrics make sense for any marketer. He also interjects fun and humor during the process. This is an aspect any reader can enjoy.

    Data-Driven Marketing is an absolute must-have for any marketer interested in good, solid, directional marketing analytics.

    Was this review helpful? Yes  No   Report this review
  • Posted January 31, 2010

    Easy to follow and connects the dots between planning and implementation

    I found the book very useful and enjoyed reading it.

    An easy to read and extremely useful book for marketers who want to tackle the complex questions of 'how do marketers demonstrate the measurable value of their marketing dollars' and 'how do they make it happen by taking control of their technology investment and implementation'.

    Defining metrics that lead to a measurable ROI for marketing investments is a challenge because of all the soft processes and intangibles involved in the marketing process. Executives and professionals alike do not disagree on the value of metrics but struggle about how to do it.

    This easy to follow book addresses the 3 key aspects of metrics development 1.) Why do you need metrics, which is becoming an obvious question in the current economic environment 2.) What to measure, the book does an excellent job in defining the metrics for both tangible and intangible value parameters and 3.) How to do it, this section explains the technology and infrastructure needs in a easy to follow way for non-IT marketing professionals.

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  • Anonymous

    Posted January 29, 2010

    Data is the new oil

    Understanding how to interpret and analyze data to optimize media, marketing, & advertising is a critical component of success. In tough economic times history has proven that the most successful brands are the ones that don't pull back, but instead step up their game. However, marketers still need to provide a tangible link between expenditures and revenue. Mark's book will serve as an excellent easy-to-follow guide to advanced analytical techniques and models that will enable marketers to outsmart the competition. A must read.

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  • Anonymous

    Posted January 19, 2010

    Critical reading for Marketing and IT executives alike

    If there is a common knock on Marketing executives and Marketing departments, it is that they are not adequately metrics-driven. The best executives and departments are changing this. For best in class Marketers and those who hope to climb the rungs toward that level of performance, Mark Jeffery's Data-Driven Marketing is a much needed tool to expedite the process. Jeffery operates at the nexus between Marketing and Information Technology, offering examples from companies who have achieved excellent results through data driven practices. This book is both highly readable and highly practical. The 15 metrics described in this book are applicable to small and large companies alike. Jeffery's data driven approach is essential for the Marketing departments of tomorrow.

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  • Anonymous

    Posted July 5, 2011

    No text was provided for this review.

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