We’ve had it bashed in by repetition that online marketing is the way to go as it’s the best way to prove marketing return on investment. This ROI conversation is a great way to justify your online efforts to the higher ups.
Ad sales, publishers and marketers need to justify their digital marketing efforts. Time and again, marketers are asked to tie those efforts back to bottom-line results. It became clear that folks are struggling to quantify their return on investment.
Three questions about online marketing
Below are the top three questions CMOs wrestle with, according to a study by Vizu, when trying to explain their digital investments:
- Why should we move more brand advertising dollars into digital?
As consumers spend more of their time on computers, tablets and phones, more advertising money has moved online. This has led to the development of richer creative formats that allow marketers to create experiences that move beyond direct-response tactics and into immersive experiences — video and social, for example — that are better exploited by brand messages.
Moreover, consistent multi-platform metrics are emerging that allow marketers to compare the relative efficacy of different media and make more informed decisions based on real return on investment.
Nielsen consider effective advertising to be that which reaches your desired audience, influences their opinion and ultimately impacts their behavior at the cash register. We call this the three R’s — reach, resonance and reaction.
- How can we parse the effectiveness of brand advertising online when there is so much data to choose from?
Nielsen recently released the 2013 Online Advertising Performance Outlook, a survey of marketers, agencies and media sellers. They found that more than half of media buyers and one in three media sellers surveyed described themselves as “drowning in data.” One marketer described online metrics as a “Tower of Babel.”
The same study found that the No. 1 metric marketers were interested in understanding, as in any advertising investment, is sales lift. Sales equate to success, your digital dollars need to justify this.
- Does TV measurement get more like digital, or vice versa?
Marketers have been trained that television advertising is the greatest possible form of advertising but historically measurement has been tough. The research highlighted two factors generally at play — technology and simplicity. From a technological standpoint, digital media allows marketers to collect more granular data than traditional TV. But those differences are shrinking. As we move to a world of connected TV, everything becomes digital. While that might suggest that TV measurement should become more like digital measurement, we believe simplicity will reign. In fact, we’re already seeing digital metrics become more like TV with the industry adoption of an online GRP for a common, simple method of calculating reach and brand lift for calculating resonance.
The conclusion is simple: keep the results simple without bamboozling with data and explain why digital is a collaborative effort with different mediums and mechanisms which can also work hand in hand with big budget efforts such as TV.
The analytics available with online marketing makes a difference
Digital marketing efforts are aimed at lead generation, make sales online, getting and affiliate marketing income, getting more subscribers and building brands. So basically the same as with all other more traditional marketing efforts.
The difference with digital marketing: You can track it from start to finish.
For a lot of your tracking needs you wouldn’t need to look much further than Google Analytics (and read up especially on event tracking and goal conversions).
Let’s look at how you would handle lead generation through two digital and traditional marketing efforts:
1. Digital marketing efforts start with tracking the number of visitors you got to your website. You can see from the stats what the sources were of the traffic. If you have set up goal conversions it would give you a full picture from source through to completion. This makes it much easier to work out the ROI
2. Traditional marketing efforts including TV, radio and print. You put it out there and hope it generates leads or sales…
That is a bit of an over dramatization, but it is true. Brands in the US have started giving up their coveted spots in the Super Bowl half-time show which is watched by hundreds of millions of people in favor of bigger digital marketing budgets.
When your digital marketing is running, you can make adjustments based on real data in real time to direct spend in the right direction.