Brands’ usual approach to modelling marketing effectiveness is through multi-touch attribution, but data issues with walled gardens and GDPR restrictions make it unreliable. There’s a better way.
“The cost of doing measurement is a fraction of the percent of what we spend on media. You have to find […] measurement that will answer the effectiveness questions for you,” said Chris Graham, global head of media accountability at McDonald’s, speaking recently to CMO.com.au about optimising the brand’s marketing and media spend.
Graham is in charge of getting best-in-class measurement in place, building values around transparency, and creating good agency management practices.
Although many companies have measurement programs in place, many fail or do not manage to optimise results. What can we learn from McDonald’s and how can brands ensure that not even that fraction of marketing spend is wasted?
Invest in long-term success
Focusing on short-term sales uplifts alone can potentially lead to a long-term problem. Strong short-term investments such as performance marketing and promotions will tend to win out with this blinkered view, potentially limiting growth in penetration and brand engagement.
Incorporating longer-term KPIs (brand health, penetration, frequency of purchase, etc) into your measurement strategy can help shift the focus and ensure your optimisation is for a balanced short- and long-term growth model.
Embrace the change
Implementing this potentially new, long-term thinking needs strong internal support. Of course, this is not a black-and-white approach as each company will face different internal challenges, but three steps can help you get closer to success:
Step 1: Secure executive sponsorship.
Step 2: Earn trust and build knowledge across stakeholders.
Step 3: Operationalise.
“It isn’t so much what’s worked for you in one instance, the most important thing is the ability to have the data to answer the questions yourselves,” said Graham.
Involve all your stakeholders – they might be in for a surprise
Once internal boundaries have been overcome, you need to turn to the external stakeholders to get their buy-in. Insights from marketing analytics are only as valuable as the actions and incremental profit they generate but this can only happen if everyone is on board. Agencies implementing the recommendations should be part of the process as well and incentivised based on subsequent outcomes.
As Graham said: “We now have our media agencies aligned on being more focused on business outcomes, and less about the inputs driving it. […] The creative agencies are on-board as well – for me, this was the bigger exercise. Their usual reaction is it’s all about efficiencies… But suddenly they realised creative plays a big role in that calculation.”
Create a unified framework
Many companies turn to multi-touch attribution (MTA) to track campaign effectiveness. However, the vision of a connected customer journey, tracking activity across all touch points, devices and media channels, has not materialised and, in fact, it is becoming less possible than ever. Walled gardens and GDPR mean than cookie-based MTA models are becoming less representative.
With Google and Facebook predicted to command 65% of all UK online spend by 2021, this problem is only going to increase. Add cross device tracking, viewability, ad fraud and cookie blocking to this and even in a digital-only world your MTA data is flawed as a single source of truth.
Outside of the online world MTA, in isolation, is blind to offline advertising, the interaction between offline and online advertising and wider macro factors such as weather and competition. MTA can definitely identify the online activities that result in conversions with greater probability. However, marketers looking for the silver bullet have allowed themselves to believe that it is a one-stop shop for all their marketing effectiveness needs.
As Graham pointed out: “Digital works in combination with all other media channels. It’s reinforced if we put more money into digital; it will help drive our revenues. But we have to have the other building blocks of TV, radio, outdoor to deliver the best outcome.”
Adapt and evolve your approach
At Analytic Partners, we believe that analysis built at a geography, store, channel, segment and persona level is more reliable, actionable and sustainable – piece by piece. That’s why we developed‘commercial mix modelling’. By addressing the whole business at a deeper, more granular level, commercial mix modelling acts as a foundation for a more unified picture of what’s working and what isn’t.
With a commercial mix lens at the centre, brands gain a holistic picture of their business through customised models addressing specific market, brand and business challenges. Such models provide campaign understanding rather than just by channel, and enable depth of insight by location, context and customer groups.
In a rapidly changing world, Brands can’t stand still. Nor should their marketing measurement approach. Is it time to re-evaluate your approach, put all the pieces in order and truly transform your business?
Source: Marketing Week