About DDMC

Use Data to Drive Your Marketing Communications

If ever there was a time for DataDriven MarCom—marketing communications driven by data—it's now. Pressure increases from the C-suite to show marketing ROI. The old joke, "I know half my advertising works, I just don't know which half," isn't funny anymore. The marketer's standby—measuring increased brand awareness—is expensive and produces metrics that don't always seem relevant.

Yet, if you're doing your best to get the greatest impact from your marketing dollar, you're no doubt integrating your marketing communications. And that presents you with a conundrum: What part of your marketing mix is working best, and what isn't? What is bringing you the greatest return for your investment? When you know that, your marketing communications process looks like this:

Integrated Marketing Communications (IMC)
Driven by Data

With DataDriven MarCom, you can quantify how your investments are working real-time and make necessary adjustments on an ongoing basis. And that will help you grow your Return on Marketing Investment (ROMI).

How DDMC Works

See Our Process. The process begins while you're in the strategic development stage. If your objective is to contribute to short-term cash flows, then you'll want to design lead-generating communications. We'll ensure that each of your communication tactics has a response mechanism built into it. Whether it's a business reply postcard, a specially created 800 number or URL, or a print-out of leads from a trade show or magazine, your prospects' responses will be coded.

Tried and True Methods for Building Response Mechanisms into Your Communications

Coded responses enable us to track the leads to sales and then back to the communication. A database allows us to capture and maintain the information in the process. See how DDMC works.

When leads come in, we qualify them according to criteria you've established, or by using our worksheets: Establishing Lead Status Criteria and Lead Qualification Form. This is a critical step in the process, as supplying salespeople and distributors with good leads saves them time and makes their jobs easier. Ultimately, it provides them with better and better leads as the program progresses.

Close the Loop between Marketing and Sales. Once the leads are qualified, we post them to the appropriate salesperson's Lead Dashboard. Salespeople and distributors access their own separate accounts online, where they view MarCom generated leads. The Lead Dashboard is easy-to-use and completely intuitive. Users may organize information any way they like and make notations as they would in any lead-tracking program.

If your salespeople or distributors already have such a program, and would not be entering data again in DDMC, contact us to see how our technical people can integrate DDMC with your existing program. If you believe sales force or distributor participation could be a problem for you, we can help. For starters, see our suggestions about how to overcome sales force resistance.

Measure ROI. As a subscriber to DDMC, you'll have your own home page-the Lead Summary Page-where your data are summarized for you. At a glance, you'll see which campaigns and tactics are pulling in the most leads, and more importantly, which are generating the most sales. You can drill down further to see which publications bring in the best leads, which salespeople are turning leads into sale, which investment brought the largest return, and much, much more. Because of the organic nature of the database, you have continual access to your information. Data is always live and real-time.

You'll receive the following customized reports at regular intervals:

• Lead status by tactic. This report shows which tactics-advertising, PR, direct mail, trade shows, the Internet-are pulling the greatest number of leads and sales.
• Lead status by company. This gives you a list of corporations that have responded to your communications, and indicates resulting sales.
• Lead status by salesperson or distributor. This shows you how many leads each salesperson or distributor has received, and of those, how many turned into sales.
• Campaign comparison: ROI. This allows you to compare your program's budget to the actual costs, and shows the resulting estimated revenue to date-metrics you need to calculate ROI.
• Tactic comparison: ROI. This compares the total cost of each tactic to the estimated revenue of each to date-more metrics that help you determine ROI.
• Publication comparison: advertising to date. This allows you to compare the number of qualified leads and sales generated by each publication and Website on your media schedule, the total insertion fees for each, and the estimated revenue to date for each.
• Publication comparison: editorial coverage to date. This shows you-by publication and/or Website-what editorial coverage you received that generated leads and sales. It indicates costs to date and estimated revenue to date for all lead-generating PR.

Get Powerful Reports. The information in these reports is powerful. It provides you with a solid rationale for upcoming budgets. It compares your actual budget to costs to date in real-time. It helps you show the ROI of each component of your marketing communications. It allows you to adjust your existing program to get the greatest impact for your investment. And, over time, it helps you increase the return on your marketing investment-ROMI.

ROI Fundamentals

ROI Defined. Marketers concerned with accountability must first ensure the integrity of the methods they use to measure. If you want to show ROI-a financial term in the strictest sense-you must express it as a percentage of your initial investment. To calculate ROI at its most basic level, determine gross margin-the total contribution made to your company's profits-and subtract that from the total communications investment. Here's the formula:

Remember that your "return" is a financial gain, not an increase in awareness, market share, leads, click-throughs or even the revenue generated from marketing communications. It is the profits generated over and above the initial investment and expressed as a percent of the investment. While marketers rightfully measure everything from internal processes to brand preference, these measures do not demonstrate ROI.

A word about brand equity: If your goal is to help create long-term shareholder value by building your brand, it's important to measure that. But DataDriven MarCom is designed to help you measure communications created to generate leads and build business in the short-term. We will help you sort business-building from brand-building communications to ensure you apply DataDriven MarCom appropriately.

Establish Standards. The formula above is basic, and just the beginning of what you need to take into consideration to measure ROI. You should find out what the standards are for calculating ROI at your company, and then maintain those standards rigorously. You'll need to apply consistent definitions of the following terms:

• Gross margin. This is gross income divided by net sales, expressed as a percentage. Your company's gross margin shows how much it earns, taking into account the costs it incurs for producing the products or services you sell. What costs are included in this definition at your company?
• Communications investment. What comprises your investment? Do you include the salaries of the people in your communications department? Your overhead? Even things like the cost of measuring your campaign may be included.
• Lifetime value of the customer. Suppose your campaign brings in a new customer and that customer reorders and reorders through the years. You will want to make sure you include that revenue in your calculation. If you don't want to wait for years to capture that data, you may estimate the lifetime value of the customer, according to your company's standards.
• Sales cycle. How long do you wait after a campaign is complete before you declare that all the data is in your database, and you can calculate ROI? If you have a long sales cycle, it may take years, because you'll want to make sure you get every response attributed to your campaign. This may also require vigilance in following up with salespeople and distributors.

More ROI Info. If you are interested in reading more about marketing ROI, two excellent books are:

Marketing ROI, the Path to Campaign, Customer, and Corporate Profitability
By James Lenskold

Measuring Brand Communications ROI
By Don E. Schultz and Jeffrey S. Walters

Links and Information on Measurement:

www.aaaa.org
www.ana.net/blog
www.arfsite.org
www.iabc.com/cw/public/mresourcelist.htm
www.instituteforpr.com
www.marketing.org
www.smeal.psu.edu/isbm