Marketing performance measurement and firm performance

Abstract

Purpose The research aims to test whether the ability to measure marketing performance affects the actual performance of firms, in the context of the European high‐tech sector. It also aims to test whether performance‐reporting frequency and size of marketing budget mediate the relationship between measurement ability and performance. Design/methodology/approach Survey responses collected from 157 marketers were supplemented with firm performance data. Findings Results show that marketing performance measurement ability positively impacts firm performance and that reporting frequency mediates this relationship. Research limitations/implications More attention should be given to the activities that are measured rather than the metrics in use – which receive much attention in the literature. Current interest in marketing dashboards may be overstated. Practical implications Enhanced ability to account for marketing leads not only to improved firm performance, but also to greater regard for marketing at the senior management level. Originality/value This is the first study to demonstrate a link between marketing performance measurement ability or frequency and firm performance in the European market. It also provides an insight into the chain of effects linking marketing performance measurement ability to firm performance.