December 27, 2018 - By Wayne St. Amand, CMO, Visual IQ
A version of this article originally appeared in MarTech Series.
The landscape in which CMOs operate today differs significantly from ten or even five years ago. Marketing leaders now face a fragmented marketplace, a growing number of channels, and empowered consumers who expect seamless, relevant experiences across every touchpoint. The digital age has ushered in a new era of accountability, forcing CMOs to prove the value of their team and their contributions to the business.
The demand for increased accountability has raised the need for effective marketing performance measurement to critical levels. Yet according to a new Nielsen report, only 25% of marketers have a high level of confidence in their ability to measure the ROI of their media or trade spend.
So, what steps are marketers taking to overcome the challenges of an increasingly complex marketing and advertising environment? Let’s explore:
Everything and everyone moves quickly today, and marketers need to keep up with that pace. The ability to respond to changing consumer behaviors and market conditions and quickly capitalize on optimization opportunities are all keys to better performance, better consumer experiences and better business results.
To move faster, CMOs know they need to remove the constraints of their old processes and invest in the data, technologies, resources, and vendors that support faster, more agile measurement and optimization.
Takeaway: Marketers must identify the technology and processes that promote a well-oiled marketing machine.
In terms of measurement, Nielsen found 79% of marketers expect to increase their investment in marketing analytics and attribution in the next 12 months. Multi-touch attribution provides visibility into the omnichannel consumer journey and helps marketers understand and react more quickly to changes in campaign performance.
By investing in attribution, CMOs can arm their team with granular insights about what’s working (and what’s not) for each audience, so they can quickly shift gears and drive continuous improvements in marketing performance.
Takeaway: Sophisticated marketers use multi-touch attribution to optimize their marketing tactics at granular levels in order to better target their audiences and drive better business results.
The study found that 79% of marketers rank search as “very” or “extremely” important, and 73% felt the same way about social media. However, understanding the true impact of these channels and how they perform in combination with other media investments has become more difficult thanks to third-party tracking limitations and new privacy regulations that impose stricter requirements on the safe handling of data.
Maximizing the effectiveness and ROI of marketing spend requires the ability to track consumer exposure to marketing and advertising and apply multi-touch attribution to the complete consumer journey.
Takeaway: Look for attribution vendors with robust data-collection processes and an extensive network of partners that can help fuel the attribution process.
When forecasting the next 12 months, 82% of marketers expect to increase their digital media spend as a percentage of their total advertising budget. By comparison, only 30% plan to invest more in traditional media channels in the near term. While digitalization has created a number of opportunities for marketers, it’s also created a number of challenges.
To truly understand the value of each consumer interaction, it’s not enough to count impressions, eyeballs or measure the effectiveness of digital marketing using siloed, last-touch measurement approaches. Marketers need to know the effectiveness of each marketing touchpoint in every consumer journey, regardless of where those touchpoints occur, so they can make smarter investment decisions.
Takeaway: Keeping up with the pace of change is mission critical if marketers are to realize the benefits of digital marketing.
The most common concern shared by marketers was improving media efficiency by minimizing ad waste. Reach and frequency measurement is an important capability to make this happen. While the contextual differences across media are important levers for identifying what’s comparatively effective, understanding bottom-line costs means first looking at the number of impressions served.
Since reach and frequency can only grow so far before experiencing a point of diminishing returns, it’s imperative to have firm controls and frequency caps in place to minimize the risk of waste.
Takeaway: Reach and frequency analysis can help identify sources of wasted ad spend and save valuable marketing dollars.
The impact of media fragmentation is enough to make any CMO’s head spin. While marketers are doing their best to adapt to the increasing complexity of the marketing landscape, many are not quite there yet.
Embracing the practices above are just a few of the ways sophisticated marketers are responding to the new omni-channel reality. Like with Darwinian evolution, it’s a matter of adaptation. Companies and teams that focus on the right ways to evolve within their rapidly changing ecosystem will find themselves thriving.
To learn how to connect your best-performing marketing with the people who matter most, download our ebrief: Reaching the Consumers Who Matter Most: A Q&A with Forrester’s Susan Bidel