A paper by marketing scholars from Aalto University appears in Journal of Marketing

The study, titled “What Counts Versus What Can Be Counted: The Complex Interplay of Market Orientation and Marketing Performance Measurement,” examines how firms use marketing performance measurement systems, and how those systems impact company performance.

According to the study, large firms appear to benefit from comprehensive marketing performance measurement. Companies should avoid being single-mindedly focused on improving short-term financial performance. Instead, firms should measure different dimensions of marketing performance, such as customer satisfaction, brand perceptions and position with respect to rivals.

- Not all marketing investments pay off in the short term. In order to avoid the perils of short-term thinking, companies can use non-financial marketing metrics which help evaluate investments and actions that are linked to top- and bottom-line performance in the long run, explains Jukka Luoma, Assistant Professor at Aalto University School of Business.

On the other hand, small companies “may benefit from measuring marketing performance only selectively or by focusing on particular dimensions of marketing performance,” the study reports. Coordination is easier in a small company, so there is less need for formal performance measurement. Furthermore, excessive focus on performance measurement may divert resources away from actually serving customers, the authors say.

The team behind the study is Johanna Frösén (St. Peterburg University), Jukka Luoma (Aalto University), Matti Jaakkola (University of Southampton), Henrikki Tikkanen (Aalto University and Stockholm University) and Jaakko Aspara (Hanken School of Economics).

The study can be found here: http://dx.doi.org/10.1509/jm.15.0153

More information:

Jukka Luoma

Assistant Professor

Aalto University School of Business

[email protected]

Henrikki Tikkanen

Professor

Aalto University School of Business

[email protected]