We’ve been talking a lot about purpose in marketing for the last few months, and while we’ve made it clear how purpose can help build marketing success, there’s a lingering issue that savvy marketers have probably noticed: how do you measure purpose? Today, we’ll discuss how analytics can be used to measure customer and employee value and impact, and wrap up the lessons we’ve learned in our February blog posts.
You know about your ROI, but how do you figure out your SROI? Figuring out your net social impact requires blending traditional qualitative measures with quantitative representation.
Measuring SROI is more difficult compared to figuring out traditional ROI because it requires bringing together social, financial, and environmental value. It attempts to measure value outside of the venture itself, and it’s challenging to choose which of the endless factors are the right ones to measure. Moreover, SROI depends on a business’s context: as Anshula Chowdhury, founder of SAM, points out, “Creating housing opportunities in Toronto versus in the slums of India would result in completely different social and environmental impact and need to be evaluated differently.”
So how do you do it? It depends on who you are. If you’re committed to a smarter planet, look at new patents, levels of publishing and dollars invested in R&D to start determining your purpose performance. That’s the easy way: the hard way is to try and quantify the impact of your purpose. That could mean answering questions like, “What do we define as our impact?” “How many impactful products do we sell, and who buys them?” “What do those products cost to develop?” “To what extent are we making money from products that make an impact today vs. those that will make an impact in the future?” and on and on until you have a series of metrics that will determine your impact.
Another way to measure your purpose is through your Net Promoter Score (NPS) which measures customer loyalty to a product. As we’ve already discussed, purpose is inextricably tied to customer loyalty since customers identify most strongly with brands whose purpose they can buy into. A higher NPS can correlate to a better communication of purpose to customers.
It’s easy to wave away business purpose as a marketing catchphrase or fluffy motivational buzzword that doesn’t actually amount to any business profit. But as we’ve learned on the blog this month, the exact opposite is true: today’s consumers are looking for purposeful companies to buy from and buy into, which makes purpose a leading driver of profit. Moreover, a strong purpose creates better employee satisfaction and a better world for all of us.
If you’re still unsure of how to implement your purpose into your operations and start measuring how it affects your bottom line, contact us for more on how to create a strong business purpose, calculate your Net Promoter Score, or create a purpose and data-driven marketing strategy!
Photo Credit: UNU-Wider via Flickr Creative Commons