Know-How Exchange : Research/Metrics

Dear Michael

Unless you want this statistic in the way in which governments and economist academics working for governments it is a pretty meaningless figure.

That an average exists is beyond dispute. That an average exists within a given sector is also beyond dispute. Given the spread of these figures (It is huge – in the range 0.1% to over 45%) it is a pointless statistic.

Even two companies in the same sector, of a similar size and staff numbers may vary their marketing spend by over 1000% when compared to each other.

So unless you are a government economist, then the main reason for wanting an average is for justifying or defending your own spend – usually to win an increase. We have this debate on this forum on a regular basis and the consensus is that the only percentage which matters is the one you have decided is right to meet the aims and objectives of your own company. No one else’s figures matter a jot and they are literally statistical chaff when it comes to any serious use of statistics in marketing.

I know that this will not be the answer you were hoping for, but if around 100 Experts here and as many on the Chartered Institute of Marketing site can all arrive at the same conclusion, maybe you should revise the reasons why you want this figure?

Or then maybe you are a Government Economist and we all know how governments make up their statistics, “Hey, Fred, what’s the answer we need? OK, now come up with some figures to support it”

Best wishes


Steve Alker
Unimax Solutions

Steve is perfectly right.
It's totally up to the company to decide how much and on what spend their marketing money.
It depends on :
- the stage company is in
- the objetives it wants to achieve
- business model
- finally available resources
- what competitors are spending

Adam

Adam’s last point is telling – What competitors spend can affect you. What percentage that is of their turnover can’t!

Steve

That’s a fair comment and a fair award, Michael.

Any chance you could satisfy curiosity and let us know why you needed this data and what value it had for you.

This is an example of “The customer always being right” which I knew when I wrote my own post, but a few of us here are trying to develop some more in depth ideas about the demand for this type of statistic and why it is needed.

Just to make you feel good, I spent months in the late 80’s and early 90’s directly gathering this type of information from competitors, using, where necessary every subterfuge in the book. I now humbly beg their forgiveness!

Best wishes


Steve Alker

Mike,

If the company is happy with its growth and market share you do not have to worry excessively about marketing spending.
It could as well be an indication that your strategy is well-devised and properly implemented.
Of course, we see that the more companies spend on marketing and especially advertsing the more successful they are in revenue generation.

Adam