Why is your company doing so well? Why is it experiencing some difficulties?
What are you doing right? And, more importantly, what are you doing wrong?
Effective marketing requires a plan, with objectives, strategies and tactics for reaching goals.
After these steps have been taken, a review of their effectiveness should be undertaken on a planned basis. This review is called “the marketing audit” and is one tool for determining your current level of success.
What is a marketing audit?
A marketing audit is a “comprehensive, systematic, independent and periodic examination of a company’s marketing environment, objectives, strategies and activities to determine problem areas and new opportunities for improvement.”
The marketing audit will also provide information for recommending a plan of action for improving performance, if one is necessary.
The marketing audit is comprehensive in that it covers all the major marketing activities of a business, not just a few weak spots.
It is systematic in that it involves an orderly sequence of diagnostic steps covering the company’s marketing environment, internal marketing system and specific marketing activities.
The diagnosis is then followed by a “corrective” action plan involving both short- and long-term proposals for improving a company’s overall effectiveness.
The marketing audit is independent and can be conducted in many ways. Self-audit, audit from across, audit from above, by a company task force, or ny an outside auditor.
Experienced outside marketing consultants give the most accurate audits because they have the necessary objectivity and broad experience, familiarity with the industry of the company being audited, ample time, and the ability to concentrate completely on the audit.
Periodic audits benefit good companies as well as those in trouble, since few organizations can remain successful over years by maintaining the status quo.
How do you start a marketing audit?
The marketing audit begins with a meeting between the company’s top marketing officer and the auditor. This meeting is to work out an agreement on goals, coverage, depth, sources for information, report format and time period for the audit.
A detailed plan as to who is to be interviewed, the questions that should be asked, and the time and place of contact is carefully prepared so that all costs can be kept to a minimum.
The cardinal rule of auditing is, “Don’t rely solely on the company’s executives and employees for necessary information and opinions. Customers, dealers and other outside groups should be interviewed and will usually provide the most useful viewpoints.”
After the gathering of data has been completed, the auditor will present the main findings and recommendations. Thus, the marketing audit is to determine the marketing problem areas as well as recommending ways to improve an organization’s overall performance.
Six areas to consider for an effective marketing audit
The effective marketing audit covers six major areas:
- The marketing environmental audit analyzes forces such as demographics, economics, ecological issues, technological considerations, political factors and cultural standards. It also is concerned with customers, competitors, dealers, distributors, suppliers and other similar factors.
- The marketing strategy audit, reviews the company’s marketing goals and strategies to determine how well these have been adapted to the current marketing environment.
- The marketing organization audit calls for evaluating the ability of the marketing organization to carry out the necessary strategies based on the environment.
- The marketing systems audit involves examining the quality of the company’s systems for analyzing, planning and controlling.
- The marketing productivity audit looks at the profitability of different entities within the company and the cost effectiveness of different marketing expenditures.
- The marketing function audit consists of an in-depth evaluation of marketing mix components such as price, distribution, sales force, advertising, promotion and social media.
Making the audit worthwhile
The most important element in the success or failure of a marketing audit is management’s willingness to listen closely to the auditor’s final recommendations, based on the analysis of the area’s discussed.
The audit is a very important tool for a company to use in gaining a thorough understanding of its markets, and it will help a company decide what customers want and how to deliver its products or services.
This understanding of the market and all its different elements gives a company the power to reach its customers in the most efficient and cost-effective way possible.