This paper examines a foundational study by Mintz and Currim on the drivers of managerial use of marketing and financial metrics in marketing decisions. The research proposes a conceptual model linking firm strategy, metric orientation, manager characteristics, and environmental factors to metric adoption, and tests whether increased metric use correlates with better performance of marketing-mix activities. Based on responses from 439 managers reporting on 1,287 marketing decisions, the study found that contextual and organizational variables—rather than individual manager characteristics—better explain metric use, and that metric adoption significantly improves perceived marketing-mix performance.
The article "What Drives Managerial Use of Marketing and Financial Metrics and Does Metric Use Affect Performance of Marketing-Mix Activities?" published by Mintz and Imran S. Currim in the Journal of Marketing in March 2013 addresses a critical gap in marketing research: increasing marketing's accountability. While advocates have long promoted the development of marketing metrics and linking marketing-mix activities with financial metrics, little attention has been paid to what actually drives managerial use of these metrics.
The authors propose a conceptual model that links firm strategy, metric orientation, type of marketing-mix activity, and managerial, firm, and environmental characteristics to marketing and financial metric use, which in turn are linked to performance of marketing-mix activities (Mintz and Currim 2013, p. 17). The primary goal and key theoretical contribution of the study is to propose and test a conceptual model of how factors drive use of marketing and financial metrics in managerial marketing decisions. The secondary objective is to link use of marketing and financial metrics to perceived performance of the marketing-mix activity (Mintz and Currim 2013, p. 18). To achieve these goals, the researchers analyzed 1,287 marketing-mix activities. The outcome of this study was intended to help identify conditions under which managers use fewer metrics and how metric use can be increased to improve marketing-mix performance (Mintz and Currim 2013, p. 17).
The article examines thirteen different hypotheses designed to increase understanding of what drives the use of marketing or financial metrics and whether metric use is associated with the performance of marketing-mix decisions. These hypotheses span multiple theoretical frameworks and organizational contexts.
H1: The greater the market orientation of the firm, the more the use of marketing metrics and the less the use of financial metrics in marketing decisions (Mintz and Currim 2013, p. 21).
This hypothesis is based on prior findings that top managers emphasize marketing over financial metrics. Top management in market-oriented firms maintains greater interest in assessing customer satisfaction and needs, the relationship between satisfaction and brand assets, and how marketing efforts influence satisfaction than in how marketing efforts influence profits (Mintz and Currim 2013, p. 20–21).
H2: Managers in analyzer, low-cost defender, and differentiated defender organizations employ more marketing and financial metrics than managers in prospector organizations (Mintz and Currim 2013, p. 21).
Prospector firms are driven toward innovative new product-markets, which carry greater uncertainty about customers. Thus, it may be premature for managers in prospector firms to measure general marketing metrics such as satisfaction, preferences, loyalty, consideration sets, and market share. Conversely, analyzers and defenders do not have pioneering or first-mover advantages, so it becomes more important for such companies to ensure market success, which requires more reliance on metrics (Mintz and Currim 2013, p. 21).
H3: The greater the organizational involvement in marketing decisions, the more the use of marketing and financial metrics in managerial marketing decisions (Mintz and Currim 2013, p. 21).
This hypothesis states that the level of organizational involvement in marketing-mix decisions can be important because selection of metrics depends on whether constituencies other than marketing are included in the decision (Mintz and Currim 2013, p. 21).
H4: The greater the extent of metric-based compensation and the greater the level of metric-based training, the more the use of marketing and financial metrics in marketing decisions (Mintz and Currim 2013, p. 21).
This hypothesis suggests that incentive pay aligns the interests of principals and agents. If principals are interested in managers employing metrics in their managerial decisions, they can develop metric-based compensation incentives to encourage adoption (Mintz and Currim 2013, p. 21).
H5: Managers with marketing (versus nonmarketing) titles, lower-level titles (lower than VP), more managerial experience, and more quantitative background employ more marketing metrics in their marketing decisions.
H6: Managers with nonmarketing (versus marketing) titles, higher-level titles (VP and above), more managerial experience, and more quantitative background employ more financial metrics in their marketing decisions (Mintz and Currim 2013, p. 23).
These two hypotheses focus on how a manager's characteristics can influence priorities, abilities, information use, and metric use. More experienced managers view more kinds of information as useful and make more financially conservative decisions (Mintz and Currim 2013, p. 22–23).
H7: Managers in larger firms, firms with (versus without) CMO presence, firms with better recent performance, and B2C and goods-oriented firms employ more marketing metrics in marketing decisions.
H8: Managers in larger firms, public (versus private) firms, firms with (versus without) CMO presence, firms with better recent performance, and B2C and goods-oriented firms employ more financial metrics in marketing decisions (Mintz and Currim 2013, p. 23).
These hypotheses reflect the resource-based view of the firm, which suggests that firm characteristics influence resources available to managers, which in turn influence a manager's priorities, abilities, decisions, and information use (Mintz and Currim 2013, p. 23).
H9: Managers in introductory/growth (versus maturity/decline) product life cycle stages, in more (versus less) concentrated industries, facing lower market growth, and experiencing more market turbulence employ more marketing metrics in marketing decisions (Mintz and Currim 2013, p. 24).
H10: Managers in maturity/decline (versus introductory/growth) product life cycle stages, in more (versus less) concentrated industries, facing lower market growth, and experiencing more market turbulence employ more financial metrics in marketing decisions (Mintz and Currim 2013, p. 24).
Contingency theory suggests that managers make decisions to match environmental and industry conditions because environmental conditions affect the manager's priorities, abilities, and need for information. Managers are expected to use more marketing and financial metrics in turbulent markets than in stable markets (Mintz and Currim 2013, p. 23).
H11: Managers employ more marketing metrics when making traditional advertising, Internet advertising, direct-to-consumer, social media, and new product development decisions than when making PR/sponsorship decisions (Mintz and Currim 2013, p. 25).
H12: Managers employ more financial metrics when making traditional advertising, Internet advertising, direct-to-consumer, price promotion, pricing, new product development, sales force, and distribution decisions than when making PR/sponsorship decisions (Mintz and Currim 2013, p. 25).
Hypotheses 11 and 12 introduce a value chain for metrics and identify the ten marketing-mix activities as a critical driver of marketing and financial metric use (Mintz and Currim 2013, p. 24).
H13: Increasing use of marketing and financial metrics in marketing-mix decisions is associated with better perceived performance of the marketing-mix activities (Mintz and Currim 2013, p. 25).
This hypothesis proposes that when managers use more metrics as decision aids, they perform more comprehensive evaluations of marketing-mix decisions, which increases the quality of decisions (Mintz and Currim 2013, p. 25).
Mintz and Currim employed a multi-stage approach to recruit participants and validate their research instrument. Initially, 500 members of the American Marketing Association and 560 MBA alumni of a West Coast university were contacted with the study purpose, participation instructions, and a questionnaire hyperlink. Additionally, marketing professional organizations with membership ranging from 1,800 to 30,000 were approached to post announcements requesting participants. In total, 439 managers responded with data on 1,287 marketing decisions (Mintz and Currim 2013, p. 26). The sample included a balanced mix of top-level and lower-level managers.
Prior to administering the full questionnaire, five academic experts pretested the instrument to ensure validity. Based on pretest feedback, the length was reduced and wording was refined. The researchers then conducted three tests to further ensure validity and reliability. Coefficient alphas were computed, exploratory factor analyses were performed, and common method bias was tested using Harman's one-factor test (Mintz and Currim 2013, p. 27).
Operational measures were constructed from a variety of sources. Measurements of firm strategy, firm and environmental characteristics, and marketing-mix activity were derived from literature on market orientation (Mintz and Currim 2013, p. 25). A two-part questionnaire was constructed from the eight operational measures. In the first section, managers indicated the level of organizational involvement for each activity. In the second section, managers provided information on firm strategy, metric orientation, and managerial, firm, and environmental characteristics (Mintz and Currim 2013, p. 26).
The results validate that the type of marketing-mix activity, firm strategy, metric orientation, and firm and environmental characteristics are more useful than managerial characteristics in explaining metric use (Mintz and Currim 2013, p. 32). Among the 439 managers reporting on 1,287 marketing-mix decisions, more than 100 managers reported on 8 of 10 marketing-mix decisions, while only 70 and 46 managers reported on price promotion and distribution decisions, respectively (Mintz and Currim 2013, p. 27).
The primary finding demonstrates that a manager's use of metrics is not based on who the manager is but rather on the cluster of other variables describing the setting in which the manager operates (Mintz and Currim 2013, p. 32). A secondary and equally important result is that use of metrics is positively associated with marketing-mix performance, and marketing metrics are as important as financial metrics in driving performance outcomes (Mintz and Currim 2013, p. 32).
"Strategies to increase metric adoption in organizations"
You’re 93% through this paper. Sign up to read the remaining 1 section.
Sign Up Now — Instant Access Already a member? Log inAlways verify citation format against your institution’s current style guide requirements.