There is no shortage of marketing metrics. The problem starts one level up: leadership does not need as many numbers as possible, it needs the few that a decision about money hangs on. Anyone who turns up there with reach and click rates is talking about detail while the table is deciding on investment and priority.
- Marketing metrics only work at the top when they are tied to a decision.
- Four numbers are usually enough: contribution margin by channel, full-price sell-through, acquisition cost and mental availability.
- Channel figures belong in the appendix, not on page one.
- A number without a reference value is not a metric, it is a number.
- Brand quality becomes measurable through category entry points, not through aided awareness.
Table of contents
Why marketing metrics are read differently at the top
A management board does not read reports, it looks for grounds for a decision. The question behind every slide is: should more money go here, less, or does it stay as it is? Marketing metrics that do not answer this question are not wrong, they are simply in the wrong place. An open rate is valuable for steering a newsletter and meaningless for allocating money across a company.
On top of that comes a translation problem. Sales and finance speak in contribution margins, stock levels and cash reach. Marketing speaks in impressions, frequency and awareness. How strongly this difference in language feeds through to growth has been examined by McKinsey in its work on the CEO and CMO relationship.
Four marketing metrics that hold up in the boardroom
Contribution margin by channel
Not revenue by channel, but what is left after goods, returns and media cost. This figure changes discussions immediately because it exposes channels that produce a lot of turnover and very little result. Of all marketing metrics it is the one that leads to a reallocation fastest.
Full-price sell-through
How much revenue comes in at full price and how much only after markdown? This figure punishes weak product and weak brand work in equal measure and cannot be talked up from one side. It is one of the few marketing metrics both sides accept without a long argument. Why it works so well as a shared number I described in the piece on brand and sales.
Acquisition cost against contribution margin
Absolute acquisition cost says little. The ratio is what matters: how long does a newly won customer take to earn back what it cost to win them? Marketing metrics become usable for finance at this point, because the answer is a period of time and not a percentage.
Mental availability in the relevant buying occasions
The only one of the four that does not come out of your own systems, and therefore the most uncomfortable. Aided awareness is often taken as proof here, but it only answers whether someone recognises the name. That is a low bar, in established markets it is almost always high, and it still does not explain why the brand fails to show up at the moment of purchase.
Mental availability says more: in how many of the situations in which someone buys in the category does the brand come to mind at all? These situations can be named, in the research of the Ehrenberg-Bass Institute they are called category entry points. For a clothing brand these are the first cold day, a new job, a trip to a different climate, or replacing an item that is worn out. Two things are then measured: how many of these occasions the brand is linked to, and how strongly compared with the competition.
For leadership this figure is usable because it points in a direction instead of describing a state. If the brand is attached to three out of twelve buying occasions, the question is no longer whether brand work has an effect, but which occasion should be taken next and with what means. That is a decision about investment and not a matter of taste.
In my experience this is also the point at which brand work becomes defensible internally. As long as only reach and frequency are reported, marketing stays the cost block that has to justify itself. Once it becomes visible that the brand is missing from a buying occasion where a competitor is present, it turns into a gap somebody wants to close. Leave this figure out and you are measuring the harvest and never the sowing.
What marketing metrics cannot do
None of these numbers explains on its own why something worked. They show that something has changed and give the discussion common ground. The explanation stays work, and it belongs in the presentation, not in the table. Anyone using marketing metrics as a substitute for judgement soon gets decisions that are cleanly argued and still wrong.
The reference value matters just as much. A number without last year, without plan and without competitive context can be told in any direction. Every figure in the report therefore needs a second one to stand against.
What a report that holds up looks like
One page with the four figures, each with its reference value. A second page with the three decisions that follow from them, including the recommendation. Everything else goes in the appendix. The structure looks dry, but it forces priority and stops the discussion getting stuck on the first interesting side number.
I report at this level regularly and have found that fewer numbers lead to more backing. Marketing metrics do not convince through completeness, but through someone being willing to derive a recommendation from them and stand behind it. More pieces on this in the Brand Leadership & CMO section.