Marketing Tools, September 1997, p. 64-67
In recent years, companies have found that traditional evaluation research, such as tracking studies, sales and share reports, and customer satisfaction studies, no longer provide sufficient input for their marketing plans. The solution is to look at the upfront processes and develop methods that improve the alignment between the front end of the marketing planning process and the desired output.
With today's marketplace conditions, emphasis must now be placed on retaining and growing the value of existing customers, as much as on acquiring new ones. Consequently, companies are setting up cross-functional processes and making other structural changes to better manage brand relationships. This means there is an increaisng need to audit these internal processes tomake sure that they are, in fact, integrated, and operating efficiently and effectively.
There are two basic ways to evaluate to how a company is managing its business. One is output controls such as tracking studies, copytesting, sales figures, and basic marketing research studies. The other is process controls. Although process controls such as financial audits have been used for years, few companies have a system for auditing the processes they use for managing brand relationships. The importance of process management has also been stimulated by TQM and ISO 9000 standards. Both require companies to continuously monitor all their processes and procedures in an ongoing effort to improve them.
Recognizing this, we designed the Integrated
Marketing (IM) Audit and made it a key component of the integrated
marketing communication's (IMC) graduate program at the University
of Colorado . (Because our audit evaluates more than just the
production of marketing communication messages, we call it an
integrated marketing [IM] audit rather than an IMC Audit.)
An Objective Opinion
IM Audit findings should be used in conjunction with customer satisfaction and other types of output controls. In other words, an audit should not be used in place of, but in addition to, traditional output controls.
An IM audit should be done by an outside, objective team and should be a census (not just a sample) of the managers of all departments impacting on brand relationships. At the audit orientation meeting with top management, the audit instruments are reviewed and customized to fit the organization's structure and needs.
The objectives and benefits of the IM Audit are self-evident in the following explanation of the audit tools. These include three basic interviewing instruments, as well as a variety of optional tools depending on the type of business and how in-depth the organization wants the audit to be.
1. Knowledge, Attitude, and Practices Questionnaire This questionnaire determines the respondents' knowledge of the marketing and marketing communication plans and targeted audiences. Answers to these questions are then compared to what employees are actually working to accomplish. Specifically, this instrument evaluates the following areas and conditions:
Objectives. What are the target/stakeholder priorities? Which stakeholders are most important? Is there agreement on communication objectives and the brand's positioning among the various marketing groups/departments/ functions? Does the objective-setting process include everyone who contributes to creating messages? What are the key messages for each of the target audiences?
Organization. How much agreement exists among and within the groups on the responsibilities of the various marketing communication departments/functions? How is coordination managed? Who is responsible for coordinating communication efforts? To what extent is managing brand relationships a cross-functional process?
Customer Databases. To what extent do customer databases exist within the organization? How accessible are they, and how often are they used? What are the procedures for caputring customer dialogue and other interactions? Is there sharing of databases, market research findings, and other types of planning information?
Contact Points. Are these identified? What messages are being sent? Are they consistent? Do they amount to a strategy? Are these experiences measured and analyzed? Who controls them?
Integration. What's the brand's current level of integration? What are the advantages and disadvantages of integraton? What are the major barriers to being more integrated?
Outside Agencies. To what extent are marketing communication agencies involved in strategic planning? How much communication/sharing of ideas is there among clients' agencies?
Interactivity. How far has the company moved into interactive, two-way communication with customers?
Planning. Does the organization use zero-based planning, especially for annual and short-term programs? To what extent are objectives based on some kind of prioritized SWOT (Strengths, Weaknesses, Opportunitites, Threats) analysis? To whom are testing results distributed, and to what extent are they used in planning?
2. Communication Network Survey This is a matrix of closed-ended questions to pinpoint the following information: Who talks to whom, how often, and about what? Who drives planning and decisions? Who influences them? How often are respondents involved in MC planning (formal/informal)? What information sources do they read? How much and what kind of information sharing is there (research, other information)? What are the patterns of internal communication among departments? Is one department doing more talking than listening?
3. Content Analysis All marketing communication or planned messages used by the company over at least a 12-month period are contentlly analyzed to determine whether they are consistent with marketing communication objectives; whether key messages are appropriate for key audiences; and whether there is consistent portrayal of company/brand positioning and image; and the amount of creative strategy and execution consistency. Specifically, the analysis looks at the following elements: the objective of the piece, the audience, key themes, the tone, brand/corporate image/position cues, use of response devices (active and passive), and mission/vision cues. Content analysis findings are then compared with interview findings to determine the organization's actual level of integration. The content analysis also helps identify gaps in performance.
What Can Be Learned From an IM Audit?
The benefits of auditing the organization, and the processes that are responsible for acquiring, retaining, and growing customer relationships, can uncover major inefficiencies and integration gaps. These may include:
Confusion about objectives. In one company, managers gave nine different responses when asked what the corporate marketing communication objectives were and ten different responses for the brand marketing communication objectives. When people are working against different message objectives, it is impossible to have message consistency; a facts subsequently proven by a content analyses undertaken as part of the Audit.
Lack of agreement on message themes. A retail chain had begun advertising "Low Prices Every Day." However, there was no agreement among managers on what this meant in the context of the chain's pricing strategy. Interviewees offered a total of seven different explanations of what this new strategy involved. None was given by more than 15 percent of those interviewed.
Another example: In a national consumer goods company, one message theme was used in 100 percent of television advertising, but only 22 percent of other advertising; another theme was used in 80 percent of television advertising, but only 20 percent of sales promotion materials and collateral materials (of which there were more than 100).
Messages not targeted to primary stakeholder groups. In one company it was found that 24 percent of all printed messages were not targeted to any of the high priority stakeholder groups identified by management, and only 1 percent were specifically directed to the target audience rated most important.
Not enough information available. In all the audits we have conducted, the majority of marketing managers say that half the time they do not receive enough information from other departments to do their jobs effectively. The types of information frequently mentioned as difficult to get were sales results, research results, and promotional and other special marketing plans for specific events and programs.
Limited use of research results. One packaged-goods company was spending approximately $150 million on marketing communication. Yet 37 percent of the managers said they did not know of any market analysis being done by the company, 33 percent said some was being done but didn't know if it was being used, and 15 percent said very little was used.
Little knowledge of annual planning. In one company, 60 percent of the managers did not know how the budget was allocated among departments, and half of the managers did not know to what extent each year's communication plan compared to the previous one.
Lack of agreement on which stakeholders are most important. In a health care facility, patients/families received the third highest rating when all responses were averaged, but were ranked eighth by top management responses. Political leaders were ranked ninth, but third by public affairs/public relations. This was in response to the question: "What is the overall importance to the whole organization of the organization's stakeholders?"
Little understanding of evaluation. In a high-tech company selling computer components to other manufacturers, 35 percent of the managers did not know if or how the company evaluated its marketing communication programs. Of those who said the company did evaluate these programs, half did not know what was evaluated and over a third did not know how the results of those evaluations were used in marketing communication planning.
Limited use of computers for networking and consumer databases. One company had a relatively small number of industrial customer; yet it did not capture customer buying behavior information, although there were many opportunities for doing so.
Unexamined Assumptions An audit can identify problems a company doesn't even know it has. For example, while auditing a high-tech manufacturer (annual sales over $300 million), we were told that the company was working hard to apply for the Baldridge Award and also was getting ready for its ISO 9000 evaluation. Consequently, the manager of marketing services was confident the company had maximized the integrationy of its processes and was doing everything it could to integrate its marketing communication. The audit discovered, however, that the marketing communication department had little knowledge of, and made little use of, the company's databases even though the company had fewer than 200 customers. (Most of the mcompany's marketing communication messages were in the form of ads in industry trade magazines.)
If the process used for building brand
relationships is not properly managed, it can produce confusion
rather than value-addedcommunication. But unlike the car industry,
which simply has a recall when defects are discovered, it is virtually
impossible to recall 1,000,000 relationships to replace a broken
promise or align inconsistent messages after they have already
been communicated. Although the IM Audit was designed to be an
evaluation tool, it also provides a road map for showing how a
company can become more integrated. The audit provides an objective,
well-documented list of what must be changed in order to strengthen