“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today's column is written by Julie Van Ullen, General Manager, US Growth, at Rakuten Marketing
It’s hard to find something new to say about digital marketing measurement. Today’s headlines about measurement seem no different in tone from those published five plus years ago.
For example, this Forbes article from 2013 notes the disconnect between what marketers think is the right way to measure online marketing and what they actually do (last-click attribution). Several years later, it’s hard to know what has changed.
We’re still having the same conversations. We’ve been envisioning this road trip for years, but the car is still in the garage. We know the destination – and have countless technologies claiming to help get us there.
What is holding us back from just sticking the key in the transmission and pushing the gas?
There is a notable disconnect between the way we measure online marketing and the actual business objectives that drive a company’s bottom line. And fixing that is not as simple as adapting the right analytics or attribution technology, despite popular assertions.
No, we need to take a serious look at the engine that powers the car before we can move forward. Right now, it’s dangerously segmented. There are parts that run the steering and others that make the wheels turn, but the car is going nowhere until those pieces learn to talk to each other.
It’s been said time and again, but it’s a serious problem that marketing is broken into channels. These channels do not talk to each other, and they’re competing to get credit for each sale. And as long as marketing budgets are broken down by channel, marketing measurement will never change. Those channel managers will always be on the hook to prove their channel is worth the investment, and they’ll always compete for a greater share of budget.
There’s no doubt that last-click attribution is an efficient way to see which channels drive the most sales – and it’s here to stay, as long as we’re measuring channel performance.
That’s why, years later, we’re still stuck in the garage.
So, what’s the solution?
Well, there are two ways marketers make money: acquiring new customers and repeat purchases from existing customers. I’m not suggesting that marketers simply start measuring performance based on these goals, but I am suggesting that they invest their marketing dollars based on these goals.
This will require that channels work together to deliver results. In an ideal world, a marketer should be able to request a percent lift in new shoppers and a set return-on-ad-spend goal for their budget. Then the budget should be optimized to deliver that performance, across the channels and strategies that will deliver their goals.
This is the first critical step in getting that marketing engine running. Not only does it enable marketing channels to speak to each other, but it has them working toward clear and common goals. Once the engine is working, attribution and analytics tools become much more valuable. When marketers know how their investments are working, they will have greater insight into where to invest more to increase their returns and make those marketing dollars work harder.
The challenge is that this is a big step to make. It’s not just a minor tweak, it’s a total overhaul of the engine we’ve been relying on for years. But the market is moving in the right direction to make this a reality.
The question is, who will be the first to put rubber to the road?