Content published in:

Editors: Center for Enterprise Sciences (BWI), Department Management, Technology, and Economics (D-MTEC) of the Swiss Federal Institute of Technology Zurich (ETH) and Axel Springer Switzerland.

1 Measuring and managing marketing and sales impact Management

In times of uncer-tainty, the guiding

principle for marketing and sales is: «More impact and success with lower budgets». Using a standardized «currency» – the touchpoint value – 360° touch-point analysis brings transparen-cy to strategic options and to the various marketing and sales activities. The authors show how the impact of these activities can be measured and managed in an integrated manner, leading to maximised return-on-invest-ment.

CHRISTOPH SPENGLER

is the founder and Managing

Director of consulting and re-

search firm Accelerom AG in

Zurich, which specialises in brand

management and communication efficien-

cy. Accelerom works with the Institute of

Mass Communication and Media Research

at the University of Zurich (IPMZ) on

research projects in the field of touchpoint

management.

christoph.spengler[at]accelerom.com

PROF. DR. WERNER WIRT

is Head of Department at the

Institute of Mass Communication

and Media Research at the Uni-

versity of Zurich (IPMZ) where he

is Professor of Empirical Communication

and Media Research. His research focuses

on media impact and media reception,

online research and empirical methodolo-

gies.

w.wirth[at]ipmz.uzh.ch

he fusion of the on- and offline

worlds has led over the past

few years to an escalation in

the number of new instruments and

platforms available to marketing and

sales. At the same time, media use

has clearly changed. Communication

power increasingly lies with con-

sumers, who decide for themselves

when and where they will accept

what messages. In this situation,

companies tend to communicate

using as many channels as possible –

which leads to wastage and large

budgets – in many cases for several

years. While companies can afford

this scatter-gun approach in good

times, it is unlikely that the re-

sources to continue in this fashion

will be available in the years ahead.

In such an environment, com-

panies are forced to check the im-

pact of their brand- and marketing

communication on a regular basis,

and when necessary, to realign it.

And do this at a time when budgets

are shrinking. Before making any

decisions on new directions, compa-

nies need to know which channels

and media are most efficient at

reaching potential clients and trans-

forming them into purchasers. With

touchpoint analysis, almost 100% of

a company’s marketing investment

can be identified, mapped and ma-

naged. Thus ensuring the focused

implementation of scarce resources

and profit-increasing activities.

Touchpoints are nothing other

than the various contact points at

which brands appear in public and

are experienced by (potential)

clients. Today, even mid-sized com-

panies find themselves managing

over one hundred such touchpoints

in the B2C or B2B areas. It is a tru-

ism that only when a brand touch-

point is accepted by a (potential)

client, can it have an effect, alter

attitudes towards the brand, and

increase sales.

Touchpoints are different «contact

points» such as sales employees,

company websites, call centres,

exhibition stands, annual reports,

online service advertising, as well as

recommendations from acquain-

tances.

Each of these touchpoints has a

different impact on the client expe-

rience. The more this succeeds in

meeting client expectations and

needs, the higher its success, as

measured by new-client acquisition,

client satisfaction and client loyalty

(see fig. 1 on page 3). Typical touch-

point analyses have revealed that:

► Around half the client’s subjec-

tive brand experience comes

through the various brand

touchpoints during the sales

process or at the point of sale.

Personal advice is central.

► Around one third of the brand

experience is determined by

personal recommendations from

friends and acquaintances, or

product recommendations from

test reports or editorial texts.

Editorials in print media enjoy

above-average credibility in the

eyes of many consumers. Beyond

this, engagement in online com-

munities and the significance of

T

Maximising the impact of marketing and sales activities The trend towards shrinking budgets means that corporate management expects precise answers to the question of which brand- and marketing management investments are worthwhile. Touchpoint analysis holds the key. __ BY CHRISTOPH SPENGLER UND WERNER WIRTH

Summary

io new management Nr. 3 | 2009

2 Measuring and managing marketing and sales impact Management

Managers hope for igniting effects from marketing and sales measures. In order to turn hope into reality, the impact of each measure has to be estab-

lished and comparable. Illustration: Lorenz Meier

peer-to-peer communication is

growing strongly.

► Over 10% of consumers take

decisions on the basis of new in-

formation sources such as the in-

ternet, e-mail or mobile tele-

phones. Web 2.0 is involved as

never before – prominent social

networks include MySpace, Face-

book and Xing.

Very often, companies only analyse

what is sent to the target group. The

focus remains on the sender, which

leaves it unclear what the target

group actually perceives and uses,

and if their behaviour changes as a

result. This is how well-intentioned

activities go up in smoke. To remedy

this, touchpoint analysis measures

what is actually received, as well as

the impact of every activity under-

taken by the company.

The goal is to focus scarce re-

sources on those contact points –

both conventional and unconven-

tional – that most strengthen the

brand-typical client experience and

its competitiveness over the long

term. But what use is this knowledge

if it is impossible to measure the

communication performance of the

various contact points and activities

against each other? In order to solve

the problem of comparing «apples

and oranges», and to reduce the

complexity of the available options,

a standard «currency» is needed to

measure the impact of all possible

touchpoints between the brand and

(potential) clients: this is the touch-

point value. This touchpoint ap-

proach enables decisions on efficient

and effective brand- and marketing

communication to be empirically

measured and substantiated. Impor-

tant questions for practitioners can

be precisely answered: How can we

succeed in achieving the attention of

our clients despite the flood of in-

formation directed at them? Should

we increase or decrease the number

of our touchpoints? What is the

optimal multi-channel mix for dif-

ferent target groups? How can we

optimise the key contact points?

What additional and innovative

touchpoints can we use to grow our

market position in future?

Touchpoint analysis delivers a

comprehensive and consistent sys-

tem of key data that brings transpa-

rency to areas impacting the market,

competition and clients. Similar to a

navigation system, the analysis helps

pinpoint the right direction for

working processes in brand- and

marketing management. Decision-

makers and planners now have an

io new management Nr. 3 | 2009

Fig. 1: Customised 360° touchpoint analysis

3 Measuring and managing marketing and sales impact Management

Illustrative example: Comprehensive 360º touchpoint analysis allows the relevant contact points for the company to be evaluated and selected

across media and areas. Source: Accelerom

instrument that makes marketing

and sales activities both transparent

and manageable.

Managing for impact

This comprehensive client-centred

approach makes it possible to find

the optimal mix for multi-channel

communications, and to use these to

manage brand- and marketing

communications for maximum im-

pact. This makes it possible to find

improved, practical solutions to

manage or redesign the com-

munication process.

The touchpoint management pro-

cess follows five stages (see fig. 2 on

page 4):

1. Qualitative touchpoint audit

(internal view)

Based on the various target groups,

the touchpoints in the company and

in the market are identified and

divided into four touchpoint catego-

ries: sales, classical mass media,

indirect communication, one-to-one

communication.

2. Quantitative survey and analy-

sis (external view)

In order to evaluate the breadth and

depth of contact point impact, the

range and touchpoint value are

measured using market research. In

addition, comparisons are made

with direct competitors (bench-

marking) to assess brand perfor-

mance at the different contact

points.

3. Evaluation of strengths and

weaknesses

This step assesses both the indivi-

dual touchpoints as well as the

touchpoint mix for the market, com-

petition, and target groups. Fur-

thermore, a specific action plan is

developed in order to optimise

strategy and activities. In qualitative

terms, this means aligning contact

points with the strategy and posi-

tioning. In quantitative terms, it

means defining the touchpoint mix

and optimising the budget alloca-

tion.

4. Implementation

This stage sees the implementation

of the optimisation goals in the areas

of sales, mass media, indirect and

one-to-one communication.

5. Tracking

In order to evaluate strategic and

tactical performances, all the activi-

ties are measured again.

The analysis of the touchpoint un-

iverse – measured by the breadth

and depth of impact of each contact

point – leads to various activities

according to the touchpoint cluster.

Touchpoints that are of central

importance for the client experience

are highlighted as «priority contact

points». The most influential contact

points are identified as those in

which it is worthwhile investing as a

way to activate and retain potential

and existing clients. Comparisons

with the competition shed light on

io new management Nr. 3 | 2009

Example: Increased client business frequency at A.T.U

4 Measuring and managing marketing and sales impact Management

Fig. 2: The five steps of touchpoint management

Qualitative touchpoint

audit (internal view) Quantitative survey and

analysis (external view)

Evaluation of each

touchpoint and the

whole touchpoint-mix

Implementation of the

optimization targets Tracking

According to Dr. Dietmar Geppert, Head of Marketing and Direct Sales at A.T.U, «Touchpoint analysis was quickly able to provide the necessary cross-

sectional impact transparency to achieve targeted performance improvements in brand management and sales.» Source: Accelerom

More frequency through optimis-ing touchpoints and budgets in marketing and brand manage-ment A.T.U has over 630 branches throughout Europe, with four in Swit-zerland. The brand offers customers a unique combination of workshop and accessory market under one roof. The A.T.U brand is familiar to over 90% of all German car owners. Some 102 touchpoints and communication measures were analysed throughout all areas of the company. As a result, 34 measures were qualitatively and quantitatively optimised, 20 new touchpoints launched, and 48 meas-ures suspended. The cost-saving potential of this was 30% compared

to existing investments.

which contacts are possibly being

better used by the competition.

Another aspect is that new and

innovative touchpoints can be iden-

tified from the numerous options

available, and used to strategically

strengthen the dialogue with clients

and prospects. These «potential

contact points» offer a platform to

strengthen the intensity of the client

experience. Since these touchpoints

are less strongly occupied by other

brands, but are still highly relevant,

they help the brand to achieve an

enhanced and more differentiated

brand profile.

The priority and potential touch-

points combine to form the corner-

stones for brand- and marketing

management. In coordination with

the positioning, the need to make

qualitative and quantitative changes

can be established and potential

savings quantified. It is also simple

to extract suitable media mix rec-

ommendations from the touchpoint

analysis. In this way, the individual

contact points and the touchpoint

mix can be adjusted so as to streng-

then the brand. Activity Based Cost-

ing ensures that resources are opti-

mally applied.

Touchpoint management has multi-disciplinary aims

Touchpoint management should be

understood as a multi-disciplinary

strategic approach, which results in

optimised performance in all mar-

ket-oriented management areas. The

goals and benefits of impact-

oriented touchpoint management

are as follows:

► Comprehensive evaluation of the

impact of all marketing and sales

activities, in order to optimise

investments in brand- and mar-

keting communication

► Achievement of above-average

impact using the budget invested

► Increased contact quality with

potential clients, and the secur-

ing of long-term client relation-

ships

► Ongoing design of the brand-

typical client experience

► Optimisation and management

of the processes for brand- and

marketing communication, in

order to achieve higher returns

through time- and cost savings

Information about the relevant

brand touchpoints and target groups

allows the activity mix to be selec-

tively optimized. The extent to

which the revealed potential to

increase strategic- and activity per-

formance is exploited also depends

to a very great degree on how crea-

tively it is implemented.

The viewpoint from media- and communication research

Neither advertising and promotion

practice, nor research in this area,

have suddenly been confronted by

new challenges. Technological ad-

vances have led to unprecedented

levels of media convergence, and to

the individualisation of communica-

tion channels (e.g. Web 2.0, mobile

communication). So much so that

faced by these new media offerings,

io new management Nr. 3 | 2009

5 Measuring and managing marketing and sales impact

«In communication, impact and results measurement lags significantly behind.»

Management

the established media are becoming

less important for marketing com-

munication.

New media technologies permit

active participation by recipients,

and give them the ability to shape

what they receive in a way that

conventional technologies simply

cannot. Recipients can now select

the offerings they use in more indi-

vidualised manner, arrange them

themselves, and thus become their

own media producers. In addition,

the audience for classical media is

collapsing into fragmented sub-

audiences that can no longer be

reached across the board by adver-

tising messages. These are some of

the reasons why completely new

advertising forms have arisen,

through which messages can be

directed in a more focused way to

reach homogeneous niche groups

(for example ad words, placements

in computer games). Beyond this,

technical developments permit a

multiplicity of interaction options

between communicators and media

users. Brand- and product expe-

riences can now be shared with far

more impact that they can via clas-

sical media. This shows how the

communication branch has reacted

to the growing fragmentation and

individualisation of new media use.

«Integrated communication» is one

of many shiny new expressions that

companies using advertising are

employing, as they try to label their

communication efforts to reach a

fragmented audience and combine

these under one umbrella. At the

same time, however, companies are

having to deal with an almost unma-

nageable potpourri of communica-

tion and marketing activities.

Optimising the communication with target groups

But even those who use as many

niches as possible alongside mass

media cannot be guaranteed success.

The calibration of advertising mes-

sages to different and heterogeneous

target groups involves high costs in

terms of time and money, which

have to be managed efficiently. The

greatest challenge is to evaluate and

control whether communication

activities for each target group will

be able to achieve their intended

effects. While the advertising indus-

try has adjusted more or less well to

the changing usage habits of reci-

pients, impact and results measure-

ment lags significantly behind.

There are numerous problems,

with the most central being: where

does the impact of communication

activities actually lie? And how can

communication impacts be com-

pared between different channels?

Regarding the first problem: the

established currencies used in ad-

vertising impact measurement have

long been outdated. They are only

retained because there are hardly

any established alternatives.

Academic and practical advertis-

ing research follow more or less

separate paths here. Academic re-

search shows that advertising im-

pact should be collected in a multi-

dimensional manner. For example, if

communication activities fail to

achieve recall, this does not mean

that the advertising was ineffective.

At the same time, brand recall is not

the same as achieving image gain,

since brands and products can also

leave a negative recall. In the final

analysis, neither high recall nor

positive evaluation is sufficient to

achieve behavioural impacts for

messages. This means that a multi-

dimensional array of advertising

activities is needed, to influence

recipients in a cognitive, (memory,

information-gain), affective (image,

emotions) and conative (behaviour)

manner.

Comparing the impact of communi-cation

It is possible to approach the second

problem in this way also, when

trying to compare the impact of

communication across different

channels. Although up to now, the

comparison of classical media with

online media was almost impossible,

the comparative evaluation of com-

munication via niche media is at the

frontier of what advertising research

can achieve. For example, instead of

measuring the advertising impact of

contacts, it is conceivable to collate

the subjective perceptions of con-

tacts, and to do this multi-

dimensionally, i.e. cove ring affec-

tive, cognitive and conative aspects.

As described above, touchpoint

analysis allows the comparison of

different perceptions across totally

different communication channels.

Since it is the subjective perceptions

of recipients that are collected, this

also permits better forecasting of

further effects, such as actual con-

sumer behaviour.

Example: International destina-

tion and location marketing Laax

Finding the best way to reach and motivate winter sports fans in Zurich, London, Berlin and Moscow through marketing and brand management

Holiday destination Laax attracts families, young people, and the best snowboarders in the world, with its unique tourist offering. Having the right off- and online touchpoint mix is pivotal for the development of its local and international target markets. International 360° touchpoint ana-lysis supplied the knowledge needed for strategic and oper-ational marketing to respond optimally to the communication behaviour of the target segment. The aims of the analysis were to achieve: • An efficient and effective response to (potential) clients in the target markets

• Successful acquisition and retention of clients

• Innovative strengthening of the brand experience across all relevant channels and media

«From the analysis of the touchpoints it is possible to identify the quantitative and qualitative potential of various strategies and concrete marketing and distribution measures,» said senior manager Andreas Bärtsch. «This also affects the offering and com-munication mix during the visit.»

io new management Nr. 3 | 2009