Hardly a day goes by when I don’t hear some marketing consultant claim that marketing is strategic and too important to measure.


Every marketing team can be (and should be) measured and compensated based on the following two metrics:

  1. Their ability to generate qualified sales leads as defined by the sales team.
  2. Their ability to reduce the cost of sales by decreasing sales cycle time.

These are simple, tactical measurements that actually have something to do with making money.  They correctly position marketing as a service to the sales function, rather than something that’s of value in and of itself.

Measuring and compensating marketing on the ability to generate qualified leads (as assessed by the sales team) not only keeps marketing focused on something useful, but it also ends the fingerpointing between sales and marketing. 

Marketing can no longer send the sales team a pack of business cards from a trade show and then grouse when the sales team throws the cards in the trash. Marketing is forced to find out what kind of leads the sales team can actually close, and then go forth and find similar ones.

Even better, once the sales team has accepted a lead from marketing (i.e. agreed that it’s a qualified lead), the SALES TEAM is held responsible for closing it.  No arguments.  No excuses.  Sales can’t fingerpoint, either.

Measuring and compensating Marketing on the ability to reduce cost of sales has a two-fold benefit:

  • Cost of sales is visible to top management, which can take action (like fire people) if Marketing fails to deliver.
  • Focusing on sales costs prevents Marketing from funding folderol that neither generates qualified leads nor helps the sales team to close those leads.

Needless to say, many companies don’t measure marketing using either of these metrics.  So what you get are a set of "sales tools" (like fancy-shmancy brochures) that have no relevance whatsoever to the sales process.  You also get statements like this:

“Ergo, a brand custodian's role is to help define expectations & encourage ever deeper engagement. This is where branding's power lies – for it gives the opportunity to clarify the exchange & engage stakeholders in ways that yields bountiful rewards all round. Those rewards might be sales, sure. But they could equally be kudos, share value, influence, reputation, or whatever else it is the two parties value.”

That’s a verbatim quote from an actual comment to my recent column: “Why The Power of Branding is a Myth.”  Read it carefully, because it’s a manifesto for a profoundly silly notion: that marketing has value beyond its ability to impact sales. 

Maybe I’m clueless, but I think that any marketing activity that’s not DIRECTLY tied to generating sales or reducing sales costs ought to be terminated. Like immediately.  Because it’s just wasting money.

I have no doubt that plenty of marketing folk will react with eye-rolling alarm at the very idea they should compensated based upon something that’s actually measurable with real live numbers. 

After all, who wants to be held accountable for revenue and cost-savings when it's so much easier (and more fun, too) simply to conduct focus groups, produce cool videos, and bloviate about “engaging stakeholders”?