The problem is that old cliché, about only half of advertising being effective but no one knowing which half. The difference today is that companies now demand an answer to that question.
Precisely because so much more data is available, it is taken for granted by executives that return on investment is more measurable. But the industry is still playing catch-up.
“We are seeing a big shift in marketers saying they really need to understand return on marketing investment,” says Richard Mullins, CEO of marketing strategists Acceleration. “What is the value I’m generating and how am I going to measure its impact on the business?
“If you speak to serious strategists and key people in marketing, most accept that it has lost some of its credibility in the boardroom, and is being seen as a cost centre because it is struggling to prove value. It’s a challenge, because marketers are focused on branding and content skills. They don’t have significant skills around measuring and showing that value back into the business.”
This invisible skills gap has massive implications. In the past, if a product didn’t sell, and price and quality were not an issue, it was often hard to prove whether the product itself or its marketing was at fault. That luxury no longer exists.
“Now, you have to work hand in hand with product development,” says Mullins. “You have to develop a framework that allows you to understand all channels, including sales and distribution, and apply a rigorous methodology to measure each of those engagements with customers. If I can identify you as a unique individual, I can track your customer journey and map it back from the purchase to the original engagement.
“Journey mapping is being talked about a lot, as it starts to prove each channel where the customer is engaged. It’s easy when it’s just digital, but a lot more difficult with offline channels. If you can do that, you can get propensity modelling – seeing what the likelihood is of purchase at different stages, and determine where to spend based on expected outcomes.”
The problem is, such frameworks and tools either don’t exist, or are unproven. However, a South African start- up called Platinum Seed believes it has part of the answer. It has developed a platform called Continuon, which offers a system both for identifying brand influencers in social media and measuring consumer engagement, with that elusive goal: to maximise return on investment.
“We can measure all this so you know that you are spending money in the right place,” says MD Bradley Elliott. “Most marketers look at historic data, but we’re looking at live behavioural data. People’s interests change over time.
“You can’t tell where someone is on the journey by looking only at the historic journey. You have to follow the customer lifetime journey of a brand. People change and you need to be able to track that.”
This is just one element of the platform, which also separates influence, brand engagement and purchasing behaviour – three metrics that marketers love to conflate. But, it seems, not for much longer.