Marketers are moving away from vanity metrics such as web traffic or page impressions as a measure of success. Instead with C-suite executives more demanding of real ROI proof points, the shift is on to use data and analytics to chart performance.
A Boston Consulting Group (BCG) study showed that the most mature brands reported significant benefits from data-driven marketing, with an average incremental 15 per cent revenue impact and 12 per cent in cost efficiencies.
Surveying more than 40 brands in Australia and New Zealand across nine industries, BCG found only two per cent have developed digitally mature brands — those that exceed consumer expectations by consistently delivering coordinated, relevant and sequenced experiences across a range of online and offline channels.
A different report this time from Forrester — “Insights-Driven Businesses Set The Pace For Global Growth” — claims that insights-driven businesses will earn $US1.8 trillion a year by 2021.
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These businesses will also grow at least eight times faster than global GDP, or an average of 27 per cent annually, as “they harness and implement digital insights to act smarter and faster than their competition. Their relentless, exponential growth trajectories will exert enormous pressure on the global economy over the next five years,” say the authors.
Focusing on teamwork
Richard Ng, Marketing Director APAC for Tableau, says before looking at the data, a key element for success in driving a company’s growth is teamwork.
“The whole leadership team needs to agree on economic outcomes that can be generated and where marketing can contribute from a strategic, investment and tactical point of view.
“This is where the buy-in from business leaders is also important. At Tableau, we do this by developing a common set of goals and understanding the sales funnel.
“Having this shared responsibility creates a common language for us to speak and has us working towards a common goal, with management buy-in.”
Ng notes the certainty of any marketing spends begins with the availability and accuracy of data.
He says, “When data is brought into an analytics platform, it is important to ensure these are clean for analysis. Data preparation is one of the biggest challenges facing customers today.
“A recent Harvard Business Review article reports that people spend 80 per cent of their time cleaning and shaping data, and only 20 per cent of their time analysing it.”
When it comes to using data to demonstrate that marketing spending is delivering ROI, Cat Prestipino, CMO at Employment Hero, says the primary marker she uses is sales revenue.
“Inside a business like ours, revenue comes from our direct sales team in the form of what inbound leads we are directing to them. Also, we are assisting them with the leads they found themselves, to be able to make that sale. So we look at that type of revenue.
“We also look at upsells and cross sells, but how have we done with increasing the spend of our current customer base — in particular, looking to move people who are currently on the free account to a paid account service.”
Nicole Papoutis, Head of Marketing at Genea, says there are various points throughout the funnel that her company uses to capture data as it doesn’t operate in a “click to buy” scenario.
“The ultimate measure is treatment cycles through marketing channels. However, metrics across the team also include new enquiries segmented by intention, web site uniques/returning and conversion, specialist wait times, on-boarding appointments, lead nurture conversion, new patients, lead value, referrer retention/acquisition and NPS, social engagement, pro-active editorial outcomes, search rankings, brand salience, market share and, of course, campaign-specific metrics depending on the brief.
“The agility and passion for what we do as a company in my team means we are in a great position to try new things, learn and move on. For this reason we have a very healthy ROMI.”
Attributing market spend
When reporting back to executives, Prestipino says not all of the marketing spend can be accounted for. Certain human traits are unable to be tracked.
“At the end of the day, while marketing does have a lot of data and science behind, it you are still looking at what makes somebody make a decision — and you will never 100 per cent know.”
Papoutis believes every marketer longs for the day they can attribute every single dollar of their marketing spend.
“The fact is that for a while now we no longer control all of our brand messages in market. But in saying that there’s no doubt company-driven messages still play a part — in some industries more than others.”
The view from the board room is also nuanced. Caitlin Green, CEO at Kinship Digital, says her company struggles to demonstrate the ROI of its marketing spend, “We are moving to a life-time customer value continuum as a measurement that aligns the organisation across marketing, sales and support.”
The pressure of ROI
As the market continues to evolve rapidly, the pressure to quantify ROI is increasing, according to Ng.
“Where the pace of change in today’s business climate increases, the frequency to which results need to be analysed and strategies modified has also increased.
“This is not a unique demand of the business, but the natural evolution of the business landscape. Agility is required now, more so than ever before.”
Papoutis agrees, noting “As a marketing team we have always been very accountable to our deliverables and where we can use metrics to guide our activity. But over the last couple of years it’s become an expectation from the Board to see the same.
“This has been partly due to increased competition and a changing industry landscape, but also I see it as a sign of buy-in and acknowledgement of the work.
“Commercial acumen in marketing is an expectation now, and so it should be — we’ve always been drivers of revenue and now the spotlight is really on marketers to deliver what they say they can.”
Marketing now and then
KINSHIP’s Green says what has clearly changed in three years is the dominance of the customer to consume marketing when and how they want.
“This has been a complex and costly change for organisations to accept, and even more costly to manage, as customers shift between being a prospect, customer, and requiring support in a just-in-time here-and-now world.
“Marketing has done a better job in understanding this complexity. However, it requires collaboration across marketing, sales, and support. Understanding where the customer is in that continuum, and how to best serve their needs at a point in time, is key to organisational success.”
About the author
Athina Mallis is the editor of the Digital Intelligence Unit of which Tableau is a member. Members provide their insights and expertise for the benefits of our readers. Membership fees apply.