You can successfully measure CRM Marketing ROI, yet it isn't always a straightforward or rapid process. This overview provides insights into key areas and pitfalls to avoid when assessing CRM Marketing effectiveness.
It is common to see businesses measuring CRM Marketing efficacy at a campaign level. While tracking campaign engagement rates and revenue is important, it does not reveal customer-level impacts over time. Each customer's interaction with and response to campaigns can vary significantly.
Tracking customer performance over time, typically over a span of 12 months, is essential. Quarterly evaluations provide insights, but the cumulative impact is more accurately assessed over the entire year.
Creating a master control group involves holding out a statistically viable random sample of customers from all CRM communications. While these customers are excluded from revenue growth opportunities via CRM Marketing, a control group is crucial for accurate measurement.
Identify the specific metrics you seek to measure. Consider how each area such as customer value, customer retention, and engagement rates influences overall CRM effectiveness.
Don’t Forget The Softer Measures
In addition to transactional measures, you should also lookto track at a customer level things like brand perception, NPS (Net PromoterScore) or intention to purchase. If your company already tracks these you mightwant to see if you can piggyback onto existing research.
Be Wary Of Attribution Models
Generally speaking, attribution models do not measure CRMvery well. They tend to measure at a campaign level and not a customer leveland they struggle if your CRM Marketing activity is always on. Attribution models needspeaks and troughs in activity to be able to measure effectiveness.
Remember All Customers Are Not The Same
Just to add some extra complexity you may want to look atcustomer types in addition to tracking the CRM Marketing performance of all customers,For example how well did CRM Marketing perform for your most valuable customers or howwell did your CRM Marketing perform by different customer segments or key demographics.
Create A CRM Marketing Performance Dashboard
It is important that your longer term customer level CRM Marketing measurements are understood and embedded into the organisation. Most of the other departments in the marketing department may be just reporting at a campaign level and so it is vital that CRM Marketing communicates its metrics loudly and proudly.
Utilizing customer data & insight allows for informed adjustments to strategy, ultimately helping to improve marketing ROI. Through attentive analysis and strategic planning, you can maximize engagement rates and reduce customer churn, cultivating sustainable success.
Further Reading
A recent article explores the challenges of measuring customer lifetime value and why even though we feel it is important, so many of us are failing to get it right.