Event: Measuring your Marketing and Business Development ROI
Location: Center for Architecture, 02.09.12
Speakers: Sally Handley, FSMPS, President, Sally Handley, Inc.
Organizer: AIA NY Marketing & PR Committee
In her book, Marketing Metrics De-mystified: Methods for Measuring ROI and Evaluating Your Marketing Effort, expert consultant Sally Handley, FSMPS, opines: “Marketers in professional service industries lag behind our corporate counterparts in the ability to definitively measure the return on our marketing investment…(and) need to demonstrate the link between revenue generated and the marketing dollars spent in order to justify their budgets and demonstrate that they are integral to the firm’s success.” Furthermore, partners and principals need to invest their marketing dollars in marketing initiatives that yield results.
Turns out, most AEC practices are not heeding Sally’s advice. In a survey she conducted of 180 firms, only 38% of those polled were using metrics to calculate the return on investment of their marketing efforts. Of those that were measuring, the most popular metrics used included tracking competitive proposal hit rates (a ratio of successful proposals versus the total number generated) and all jobs won. Firms that are not measuring their efforts pointed to lack of time, inability to acquire the necessary information from unmotivated staff, and a belief that business development outcomes could not be directly attributed to marketing efforts. The egregious culprit, however, may be the fact that 93% of firms surveyed did not have a line item in their budgets for ROI measurement.
Handley’s approach to measuring and evaluating marketing efforts includes quantitative metrics as well as assessing qualitative results. Her “marketing dashboard” includes leads and prospects, communications and public relations, firm identity, proposal and presentation efforts, jobs won, and client satisfaction. As a marketing professional, understanding your firm’s financial goals is crucial. Calculating a marketing recovery factor, which compares the contract value of a project to the marketing revenue spent during the pursuit of that project, is one way to measure efforts by company division, market sector, and client. Handley also advises firms to establish separate marketing budgets for distinct market sectors. By using this method, firms that are trying into break into new market sectors can assess their efforts fairly, as new sectors may not have a strong ROI initially.
Qualitative assessment includes strategically identifying the most appropriate clients as well as projects to pursue. Focusing on retaining key clients and garnering repeat work from them will yield a more effective marketing program. Handley warns against the “more is more” approach to proposals and instead recommends funneling strategic and robust efforts toward fewer goals to produce higher quality work and increase chances of success.
Handley’s key to marketing metrics is goal setting—for example, the number of new client meetings sought or hits to a firm’s website—to assess effectiveness. “The numbers don’t lie,” says Handley, and by starting small and simple in your measurement, even the most daunted marketing professionals can begin to churn out ROI metrics that are bound to get attention.
Jacqueline Pezzillo, Assoc. AIA, LEED AP, is a regular contributor to e-Oculus and Oculus as well as a marketing and public relations professional. You can find her at the non-profit, Room to Read.