Importance of Metrics in Marketing Strategies Case Study

Importance of metricals in Marketing St evaluategies Case StudyTeresa A. CochranMarketing is a essential responsibility for every last(predicate) activities related to advertising and sales st prisegies that are life-sustaining to the success of any organization. The tycoon of an organization to efficiently market its results and go is directly related to the success or failure of the phoner. As historied by Arikan (2011), metrics form the base of any utile merchandise strategy. However, many firms fail to utilize metrics to calculate success or failure of their strategies. Most companies tension on the late put ups generated overlooking early(a) serious formulas that analyze the actual success of any type of market strategy. As the business environment evolves, virgin market strategies and options are invented which requires marketers to verification a step ahead by understanding key metrics and what they mean for a attach tos market strategies.Ide solel yy, these metrics are measurable set substance ab function to demonstrate the level of in force(p)ness of trade campaigns on all selling channels. Since marketers operate across many channels, their marketing strategy will involve a variety of activities, which bring ups it important to track progress and functioning of their actions with the right performance indicators. This merchant ship military service a business to exceed its marketing objective lenss and make improvements when facing challenges. Before choosing the right metrics, it is important to carry channels being utilize and who in the business will use the resultant information to make decisions (Arikan, 2011). For variation dictatorial, following are v important metrics that the hoyden along should use to evaluate performance of their marketing strategies. For this assignment, 5 marketing metrics will be reviewed to pageant the pass judgment success of the Pleasantly Plus, plus size retail boutique and perpetration shop. Each factor is a subcategory of the marketing metrics main categories sales metrics, customer cockiness to buy metrics, customer metrics, distribution metrics and discourse metrics. The assignment will review in detail equations used to think the following sales harvest-feast, cognisantness, retention rate, get of outlets and result rate.Sales inflectionStrategic marketing plans are created to facilitate an elevated consumer sentience to agitate and attract customers to leverage your product. Data related to sales volumes measure the rate at which sales of your product and is imperative for decision making for the boilers suit fiscal sustainability and financial success This metric is also valuable for strategical planning and will make up future growth projects for the company. athletics sovereign must also monitor sales selective information including total sales and types of products sold. Sales data must then be evaluated by the company to determine the authority of the marketing strategy or to determine barriers to sales. The sales metric being utilized to determine the efficacy of the advertising methods used must be monitored with respect to creating sales through increased product cognizance. In addition, this evaluation would also determine the tactics that relieve oneself a negative impact on sales goals (Farris, 2010). These key indicators will be monitored by the marketing department over multiple sales catamenias. sportswoman despotic erect utilize sales data to monitor growth and of the new product telephone line Sales figures for the sports apparel product line will be monitored shadowerly beginning with the date of the initial cede of the products. This metric will be monitored for one year with the goal of establishing sales trend lines relative to seasonal sales. Sales growth represents the variance in comparing sales from differing time periods. This data can be reflected mathematically as(Cur rent time period net sales- Previous time period net sales)_________________________________________ x cytosine(Previous period net sales)OrAs applied to Athletic peremptory ($50,000 net sales qtr 2- $35,000 net sales qtr 1_________________________________________________________________ x100$50,000summercater Supreme trys a growth rate from Qtr 1 to Qtr 2 of 30% guest readiness to buy metrics guest awareness is a method utilized to determine the good turn of consumers who have been made aware of the products offered, in this case by Athletics Supreme. From a marketing viewpoint, a strong awareness of your product increases capability consumer purchase. Marketers use customer readiness such as awareness, preference, purchase intention, trial rate, and repurchase rate as performance indicators of product branding therefore these indicators have a striking deal of influence over strategic planning of a company (Hanssens, Pauwels, Srinivasan, Vanhuele, Yildirim, 2014).Consumer pu rchases are influenced by multiple stages of product awareness before purchasing. considerateness to the consumers thought process related to decision to purchase before determine an appropriate marketing plan. Athletics Supreme enters the sports apparel market with an exhibit over the competition due to having a presence in the labor. The company has a reputation for quality therefore, consumers have an established recognition of the flesh brand.Athletic Supreme should collect behavioral purchasing data establish on preferences gathered from sales databases. By evaluating consumer purchases, Athletics Supreme can gain valuable data on consumers product preferences (Kotler Keller, 2012). stageic surveys of customers that purchase the apparel would further assist in evaluation the most effective marketing tactics. Akrin (2011), notes that the quality advertising message will make customers more(prenominal) inclined to purchase sportswear. Athletics Supreme objective would be t o achieve optable response rates beyond 90 percent, and adjust marketing strategies accordingly.Videos are another mediocre that would be used in the height of awareness regarding the new line of sportswear products. The number of viewers of a video is an effective way of determining whether the products receive the attention of the tush customers. The target customers are expected to be impacted by the viewership of the videos to pursue in the purchase of the products being marketed (Arikan, 2008).Based on the viewership metrics, Athletics Supreme should determine the most efficient marketing channel that facilitates the creation of awareness regarding the product to consumers. The Greater attention of the marketing medium that is most effective should be done to ensure that there is maximum exploitation of the medium to create awareness and influence consumers to make purchase decisions in favor of the sportswear products (Farris, 2010). As applied to Athletics Supreme, an a pproach to quantifying product awareness is based on terms per 1,000 suffers and then calculate the spend per contact for each advertisement.Marketing Originated Customer % is a ratio that debunks the percentage of the new business that is a result of Marketing efforts. It is computed by getting the number of customers that started with a lead generated by Marketing and then dividing it with the total number of new customers that signed up in a period the survey is then multiplied by 100 (Zikmund Babin, 2013).This metric will show the portion of customers acquisition that originated from Athletics Supreme Marketing efforts in a certain period. This metric is best analyzed using a closed-loop marketing analytics system as manual computation is tiring and takes time (Kotler Keller, 2012).Customer metricsCustomer metrics is collection of data that can be used to determine what matters most to the customers past, present and future. For Athletics Supreme a key subcategory in custo mer metrics to analyze would be the exist of customer acquisition. Per Arikan (2011), customer acquisition cost, is the cost incurred convincing a potential customer to buy a product or service. This metric is important to a company as well as its investors. Investors use it to determine a companys profitability by analyzing the amount of money that can be extracted from potential customers and cost incurred extracting it. Marketing specialists on the other hand use the metric to optimize returns on their advertising investment. It luxuriouslylights whether be of extracting money from customers can be reduced which would help improve the companys profit margin.Mathematically, it includes all cost incurred in acquiring customers over a given period shared out by the total number of customers acquired in that period. Ideally, this includes all sales and marketing cost including advertising cost, salaries, commissions, bonuses and germane(predicate) overheads in each period (calen dar month, quarter or a year) (Zikmund Babin, 2013). For example, for Athletics Supreme, the Customer Acquisition cost in the first year will beTotal Marketing cost for the whole year/number of customers acquired within the yearTherefore, if the company played out $50,000 on sales and marketing in a certain month and added 50 customersCAC = $50,000/50=$1,000CAC will be important to Athletics Supreme, as it will indicate the effectiveness of the money invested in acquisition of new customers. A high metric will indicate the company is consumption too much on sales and marketing while a low metric would indicate that the company is using low costs to gain customers (Arikan, 2011).Customer Retention browseCustomer Retention Rate is used to calculate the loyalty of customers. Acquisition of new customers usually costs more than it costs retaining current ones ( theme Lyberger, 2014). Arikan (2011) argues that evaluating the dedication of a customer towards a company enables marketer s to improve their strategies. Encouraging customers to stick with ones business for long helps increase revenues. It is calculated by subtracting the number of new customers from the total number of customers in a certain period divided by the number of customers at the start of the period and then multiplied by 100 to make it a percentage, i.e.CRR= Customers End Period (CE)-New Customers for the Period (CN)/Customers at Start of the Period (CS) x 100.For example, if Athletics Supreme starts a month with 50 customers and gains 20 new ones but lose 15 customers in that month, the CRR would be(55-20)/50*100= 70%This metric will help Athletics Supreme to assess the loyalty of customers for each of its brands. It will also snap off the companys ability to nurture existing customers.Customer lifetime honor (CLV)This metric is used to assess the economic value brought by a customer to a business for the entire duration the person remains a customer. It evaluates everything commenceme nt with the customers first interaction with the company to the final purchase. It is a comparison of revenues generated by a customer and the costs of acquiring and maintaining the customer. Calculating this metric helps to reveal whether there is value in maintaining long-run marketing channels. If the CLV value is high, a company needs to invest more in retaining customers for the long-term (Arikan, 2011).For example, if Athletics Supreme fills 300 orders with revenue of $20,000, the companys Average Order repute (AOV) would be $66.67. To determine Purchase Frequency (PF), the number of orders is divided by the number of whimsical customers. Assuming Athletics Supreme had 200 unique customers, PF would then be 1.5.Customer pass judgment (CV) would then be AOVxPF, which is 66.671.5 =$100Once CV is determined, Customer Lifetime Value (CLV) is determined by multiplying the CV by the duration the customers have been in the company. Assuming the orders have a 4-year contract, CVL would beCVL = Customer Value (CV) x Customer distance with the Business=1004=$400This means, Athletics Supreme Customer Lifetime Value over 4-year duration is $400.Athletics Supreme will use this metric to analyze the potential value customers will bring into the company. According to Shank Lyberger (2014), a high value of the metric means customers are manner of speaking high value which the company should aim at. A very high value would however mean the company is under spending and so restraining growth.Distribution metricsSimon (2012) considers percentage of ledge space, or the space inevitable to sell an item as an essential marketing data point. Athletics Supreme would ideally like to occupy as much of the peril space as possible. By occupying a large amount of shelf space, Athletics Supreme has effectively monopolized the stores All Commodity Volume (ACV), or the rate of everything sold in the store. Despite its retail prominence, Athletics Supreme must remain effective by maintaining a successful summate chain logistics. As Simon, (2012) argues that even if Athletics Supreme obtains maximum display areas for the new product line, including overstock for internet sales, it will lose customers if the lend is not adequate. Overall, most retailers with make decisions on inventory based on the potential of selling the item quickly.Communication metrics is the gathering of data that can be utilized to determine the effectiveness of the varying forms of communication channels used. In this case, Athletics Supremes a key subcategory is effective reach. rough-and-ready reach is the subset of the target segment of the population that can be effectuate by an advertisement during a specified time frame. Additionally, the response rate data measures the rate of response that customers respond to information sent to the target market.Communication Metric) Per Arikan (2011), marketing influenced customer percentage is similar to Market Originated Customer % . However, it factors in all new customers where marketing efforts touched and/or nurtured the lead at any point in the sales process as opposed to only originating the lead. For example, if the sales person of Athletics Supreme rear a lead who later attended a marketing yield and closed, the new customer is assumed to having been influenced by Marketing. This percentage is usually high than that of the Marketing Originated Customer % as it is more inclusive. It usually ranges from 50-99%.The retail industry is very competitive, therefore, Athletics Supreme must monitor the effectiveness of all forms of customer communication. For example, emails, coupons, and discounts offered on the next customer purchase. Increased sales figures afterward an email campaign would be a key indicator of the effectiveness of communication. The company can also measure its response rate via atonement surveys, Facebook and Twitter followers, and click through rates online. Per Kotler and Keller (2 012), Athletics Supreme should focus communications based on frequency of purchase, which can manipulate response rates to double-digits.ConclusionUsing metrics effectively will help Athletics Supreme understand the success of its marketing strategies. It will reveal areas where the companys marketing team excels at and where the team needs to improve. Therefore, metrics play an important role in marketing efforts and the company should use the preceding(prenominal) metrics as well as add others that are relevant to its business.ReferencesArikan, A. (2011). Multichannel marketing metrics and methods for on and offline success. John Wiley Sons.Farris, P. W. (2010). Marketing Metrics The classical Guide to Measuring Marketing Performance. Upper Saddle River, NJ FT Press.Hanssens, D. M., Pauwels, K. H., Srinivasan, S., Vanhuele, M., Yildirim, G. (2014). Consumer Attitude Metrics for Guiding Marketing Mix Decisions. Marketing Science, 33(4), 534-550. inside10.1287/mksc.2013.0841Jeff ery, M. (2010). Data-Driven Marketing The 15 Metrics Everyone in Marketing Should Know (1). Hoboken, US John Wiley Sons, Incorporated. Retrieved from http//www.ebrary.comKotler, P., Keller, K. L. (2012). Marketing managementShank, M. D., Lyberger, M. R. (2014). Sports marketing A strategic perspective. Routledge.Zikmund, W. G., Babin, B. J. (2013). Essentials of marketing research. Australia South-Western Cengage Learning.