WE ASKED:
“How is your business attempting to measure the return on marketing communications?”
YOU ANSWERED:
Respondents completed a survey covering their companies’ current and future use of ROI measurement, and contributed additional comments and insights. A summary of survey responses to the individual questions follows, with our commentary.
First...what did you say?
When offered the chance to share their general opinions and success stories about the subject, respondents contributed these comments:
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“We conduct rich response analysis for EVERY direct marketing campaign we manage.” |
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“For one client, we did an in-booth survey and lead card to discover what products were of most interest to customers. We then changed sales tactics due to information gathered and increased business with products preferred.” |
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“ROI information helped me justify to our publisher the value of telemarketing. Based on the data, I was able to convince him to increase the telemarketing budget as well as move it up in the renewal series.” |
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“We have coded e-mail promotions and saw a distinct response in the 48-72 hours following the e-mail.” |
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“ROI remains elusive in my opinion.” |
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“The easiest way to measure is to look at sales with accompanying direct mail coupon.” |
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“I’m just trying to get ROI instituted, and it’s a real challenge!” |
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“Clients always want ROI but are not always willing to pay for the tracking measures.” |
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“We demand ROI for any new initiatives, especially any digital (Web-based) marketing programs. Fortunately, by tying back to other data, we can create very accurate ROI data on every on-line program we create.” |
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“This is an arena that our company is definitely lacking. I’d like to know how I can become educated on successfully tracking ROI of marcom efforts.” |
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“The client needs to be a co-participant in this. The agency cannot do it alone.” |
Hey Don, only 28% of us measure most of our communications?
IMC guru Don Schultz has made ROI measurement one of his latest and greatest crusades...and might be surprised that he has more measurement devotees than he guessed. More than nine of ten respondents say they are already measuring ROI (at least as they define it, not Schultz) in some or most of their communications. And eight of ten are expecting to do more measuring in the future. Which is all fine and good. But a closer look shows that only 28% of us even come close to measuring the ROI effects of fully integrated programs by measuring “most of their communications.”
Respondents report measuring ROI in...
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Most of their communications: 28% |
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Some of their communications: 64% |
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None of their communications: 8% |
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Less than half of us measure to justify budget increases.
Though we’re seeing high interest and use of measurement in marketing communications, we believe the effort has real value only when the metrics are tied back to actual economic returns. Only then can you prove that your marketing communications is a profit driver instead of a cost center. On the surface, it looks like about half of us or less are actually tying measurement to financial results to justify or sell a marketing investment.
Of the respondents,
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51% have directly linked specific marketing communications tactics to specific dollar results. |
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40% have justified a larger budget by proving actual dollar return on investment. |
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40% have justified a program by pointing to measures of attitude change or inquiry generation. |
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And most all of us still don’t believe everything is worth measuring.
A tactic-by-tactic view shows expected skews between the traditional marketing disciplines: response-oriented media like DM and email lead in propensity to measure, while softer “advertising” and public relations lag. We could’ve guessed the low measurement potential of broadcast, but were surprised to see 39% of the sample deigned direct marketing measurement optional.
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Print |
Internet |
TV |
Radio |
Direct
Marketing |
Public
Relations |
Events |
| Measurement/ROI analysis here is vital. We don’t spend a nickel in this area without a specific plan on how it will pay dividends. |
27% |
31% |
7% |
3% |
49% |
9% |
22% |
| Measurement/ROI analysis here is somewhat important. It’s certainly an area of increasing interest. |
48% |
47% |
13% |
19% |
35% |
42% |
46% |
| Measurement/ROI analysis here is unimportant. In some cases, the results of marketing are impossible to measure, but that does not deter us from making investments that seem reasonable. |
11% |
11% |
5% |
9% |
4% |
32% |
14% |
| Not applicable to us |
6% |
6% |
60% |
50% |
5% |
7% |
7% |
So over 50% of us just measure the weak and easy. Sometimes?
The best kind of measurement unambiguously links marketing communications to the hard sales numbers. To make these links, we encourage business marketers to go beyond just measuring attitudes and start looking at how their customers/prospects act on those perceptions.
So at one level it’s encouraging to see that 60% of respondents track pre-buying behaviors such as Web visits and requests for info tied to specific promotions.
However, those seem like pretty soft measures.
But wait, more than half of the sample tracks inquiries all the way to purchase and then links back purchase to the initial communication vehicle. Now that’s a stronger measure but to us still seems to focus on individual tactics rather the cumulative effect that the whole integrated program, made up of several tactical but hopefully interrelated media, has on transactions.
Only a measly 39% of us are even measuring the basics
Even worse, although 51% of the total sample claim they measure attitudinal changes such as awareness, familiarity, preference, etc., only 39% of the client-side marketers said they do. Which may indicate that despite the hopes and sales pitches of the special interests among us there’s not much attitudinal measurement going on to form the communications and brand base for understanding stronger behavioral measures.
A mere 35% of us measure our brand’s power.
What’s even more disappointing is that in an era when more and more business marketers are discovering the power of branding, only 35% measure brand associations (what the brand means or represents to people). If used correctly, brand association measurement can provide an important missing link between awareness, familiarity, intent to buy and actual purchase behavior, not to mention a firm measure of exactly where the brand’s equity resides relative to customer/prospect purchase criteria.
And only 37% of us link communications-influenced behavior to financial transactions.
What’s downright disconcerting to see is that only 43% of us are making the vital link between behavior and financial transactions. And when we break out client-side marketers (where transactions actually get measured) from the rest of sample it gets even worse. Only 37% measure behavior linked to financial transactions. One could make the point that true ROI is all about making these links across all media. That is, measuring the interrelated effect of integrated media on attitudes linked to brand associations linked to behavior linked to financial transactions.
The measurements conducted are detailed below:
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60% measure pre-buying behaviors (such as responses to Website, requests for information) generated by specific promotions |
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51% track inquiries all the way through purchase and then linking back purchase to initial communication vehicle |
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51% measure attitudinal changes in target market resulting from specific promotions, such as awareness, knowledge, interest |
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47% query buyers after the fact about how they became aware/interested/convinced |
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46% measure public relations sightings and placements |
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43% measure behavior linked to transactions |
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36% measure propensity-to-purchase attitudes tied to specific promotions |
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35% measure shifts in brand associations (what the brand means or represents to people) |
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4% cite “other” tactics |
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What’s really happening out there?
When we took an up-close look at the numbers and separated client-side marketers responses from agency and media responses, we found a few differences. We think they’re worth noting because we believe that client numbers probably better represent what’s actually happening in the marketplace as opposed to what could be or should be happening, or what some special interests might be trying to sell as ROI measures.
A mind-boggling variety of tools/methods.
Business marketers report several different measurement techniques, with Web visits/email responses, survey research, lead-tracking databases and versioned communications leading the way. A surprising 44% reported their measurement included anecdote-gathering from the sales force—valuable indeed, but realistically not much use when you’re called before the board to justify your budget.
Here’s the percentage of the sample who use various tactical measurement tools/methods:
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68% Web logs, email response logs |
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54% Survey research |
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51% Lead-tracking databases |
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46% Response codes versioned for specific ads, Web promotions, direct response vehicles |
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44% Internal anecdote-gathering among salesforce |
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26% CRM or third-party analytics package |
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25% Magazine sponsored readership studies |
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6% Other |
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In addition to the tools/methods ranked above, respondents reported using these kinds of tools/methods:
The bothersome bottom line from Mobium.
At first glance it appears most business marketers understand the value of measuring, and regularly track the easy stuff such as direct response and Web visits or whatever else special interests might be peddling this month as ROI. Although we don’t mean to slight these metrics, let’s recognize them for what they are. They are mere metrics. In and of themselves they are not ROI measurement.
So let’s stop kidding ourselves. ROI is not a bunch of unconnected, unrelated metrics. True ROI is one thing and one thing only. It is the ability to go to the boardroom where all the people who speak the language of money reside and say, “You gave us X marketing communications dollars and because of our efforts it has earned Y in incremental, immediate income flows back to the company and Z in accrued brand assets.”
As much as the traditionalists and special interests among us want to believe otherwise, tracking click-through rates, response averages and awareness blips are about as close to doing true ROI measurement as taking a spin on the bumpity-bump, mechanical pony ride in front of the Super Kmart is to jumping on the back of Seabiscuit in his heyday. The real thing’s an entirely different animal. And until we realize what true ROI is, and focus on measures of full integrated marketing programs related to dollar returns, we’re only joshing ourselves down the road to budget oblivion and doing a great disservice to our profession along the way.
For details on this radical point of view, check out this recap of Don Schultz’s recent presentation at Mobium covering a surprisingly empirical method of ROI measurement. And be sure to let us know what you think.
A measurable thumbs-up from us.
Congratulations to the three lucky winners of the book Measuring Brand Communication ROI by Don Schultz and Jeffery Walters. We also hope you enjoyed our online booklet, “Maximizing Creative Impact in the Face of Business Communications Change.” Also, special congratulations to the winners of the special ROI thumb-wrestling ring!
Thanks to all our ROI-focused survey takers. And watch for the next Marketing Out Loud Survey from Mobium, arriving soon here at mobium.com.
