Marketing is the lifeblood of any brand. It drives awareness, builds familiarity, encourages interest, stimulates trial, and motivates re-purchase. Yet, measuring the effectiveness of your marketing efforts is challenging. Many companies rely solely on surface-level metrics like ad exposure, content engagement rates, or website traffic to gauge success. But these metrics only tell some of the story and don’t necessarily capture delivery against the real business objectives.
In this article, we delve into the intricacies of marketing effectiveness, offering insights into how understanding and proving its impact can substantially enhance your marketing ROI.
What is Marketing Effectiveness?
Assessing marketing effectiveness involves understanding and proving how marketing campaigns impact influential business metrics such as brand perception, sales, and overall growth. Marketing is a significant investment for most businesses, so capturing this information is crucial not only for effective planning and decision-making but also for justifying to the board the overall contribution of marketing to the business.
According to a report by Marketing Week, over 60% of marketers say that measuring marketing effectiveness has increasingly become important in the past three years. However, despite this focus, marketers struggle to demonstrate the impact of marketing on financial outcomes. The latest CMO survey by Duke University revealed that 61% of senior marketers struggle to prove the ROI of their marketing efforts. You can’t prove impact if you don’t measure what you are doing, so let’s take a look at how to measure effectiveness.
61% of senior marketers find it challenging to demonstrate the impact of marketing actions on financial outcomes.
Why Does Measuring Marketing Effectiveness Matter?
Businesses have limited resources, and marketing is sometimes seen as an unnecessary expense. However, the cost of effective marketing programs is increasing due to rising input costs such as production, technology, and media costs. In this environment, marketing teams have to work even harder to justify current budgets, let alone increase them. This makes it even more important to measure the impact of marketing efforts.
Measuring the effectiveness of marketing activity allows marketers to present a reasoned and reasonable argument to secure sensible budgets in the boardroom and face up to CFOs. What’s more, measurement provides direction. By leveraging data-led insights, marketers can be empowered to chart a course for sustainable growth.
It’s worth noting that the impact of all marketing activity is not easily measurable. The attribution debate continues and is arguably increasing in intensity, particularly as digital marketing’s measurement mainstay, the cookie, starts to crumble.
However, just because it is difficult doesn’t mean you shouldn’t attempt it. In today’s budget-constrained business environment, measurement empowers management. Evaluating efforts across every stage of the marketing campaign lifecycle is critical to ensure that you are reducing risk, improving effectiveness, and optimizing resources.
How to measure marketing effectiveness
To effectively measure marketing effectiveness, you must define success, collect data, analyze insights to determine ROI and optimize your marketing strategy based on the insights gathered.
1. Define success
To assess your marketing effectiveness, start by defining success metrics aligned with your business and marketing goals. This applies regardless of whether you subscribe to the distinctiveness or differentiation approach, as both models require clear objectives to begin with. While there is no universal method for measuring success from here, it is essential to track various metrics before, during, and after campaign stages to gain valuable insights into what’s driving success or failure.
Some of the standard metrics that are used to guide investment and measure success at a high level include:
Reach
Measure the total exposure of your marketing message to your target audience within a specific period. Reach indicates the campaign’s potential impact since it represents the broadest group of people your activity may have influenced. It’s really a hygiene factor to ensure your activity has sufficient scale to influence as many buyers in your category as possible.
Engagement
Assess the level of audience interaction and involvement with your marketing efforts. There are many different ways to do this, but they should reflect what suits the tactics employed and their role. For example, if your campaign is heavily video-driven, you’ll want to consider viewer numbers and click-through rates, but also time spent viewing or completion rates, as measures of depth of engagement. Engagement with a brand-building activity will have different measures versus a sales promotion. The key is to ensure the metrics used are fit for purpose.
Conversion
Evaluate the percentage of leads taking desired actions. These might be website visitors buying a product, booking a meeting, or signing up for your email communications. The percentage will need to be set and benchmarked against your customer buyer journey and the relevant stages in that process. Conversion volume is a fundamental metric to help justify the value of marketing because conversion rate signifies efficiency.
Return On Ad Spend (ROAS)
Calculate the revenue generated from your marketing activity against the amount spent, and in simple terms, you have the ROAS. When done properly, this is a key measure of marketing effectiveness and a powerful signifier for conversations with the CFO.
Cost Per Acquisition (CPA)
Measure the average cost associated with acquiring a new customer through marketing channels. CPA is calculated by dividing the total advertising cost by the number of conversions generated.
Brand Metrics
Brand health is a critical measure of long-term business viability. It is essential to measure any marketing campaign activity because the effects of advertising build slowly over time. Advertising builds (to use the ‘distinctiveness’ terminology) mental availability that helps ensure your brand is on the list and considered favorably when people are shopping your category. Measuring that mental impact versus the immediate sales effect requires measuring brand health. Ideally, brand health is measured through continuous brand tracking by looking at measures such as:
- Brand Awareness: Assess the level of recognition and recall of your brand among target audiences.
- Brand Consideration and Purchase Intent: Measure consumers’ likelihood of considering your brand and intending to choose you over others.
- Brand Loyalty: Evaluate customers’ commitment and loyalty to your brand, including repeat purchases and advocacy.
- Brand Associations: Identify attributes consumers associate with your brand, providing insights into brand perceptions, positioning, differentiation, and distinctiveness.
- Brand Sentiment: Analyze overall sentiment surrounding your brand based on consumer feedback, gauging positivity or negativity towards your brand.
2. Collect data
Once you’ve decided what you want to measure, you need to capture the data. Utilizing a variety of data sources will ensure a more holistic and accurate understanding of your marketing efforts’ overall impact.
Below are just some of the methods you can use to collect useful data:
Primary research
Directly gather data from target audiences through interviews, ethnographic research, or survey-based approaches. Interviews and ethnographic research provide rich, emotive depth to inform strategy or creatives. On the other hand, surveys are used to pre-test creative or measure in-market impact in a robust, scaled, and representative manner.
Glow’s online research platform facilitates rapid primary consumer research collection, providing businesses with valuable insights from their target audience quickly and efficiently.
Third-Party Data Providers
Access datasets from media networks, social media, ad tech, and syndicated research businesses to inform segmentation and profiling through demographic, psychographic, and behavioral insights.
For example, Tracksuit offers always-on brand tracking data that gives marketers insights into their and their competitors’ brand health.
Website and Social Media Analytics
Analyze metrics from platforms like Google Analytics, Meta, or LinkedIn to inform targeting and assess audience engagement, content performance, and conversion rates.
Customer Relationship Management (CRM) Systems
Integrate CRM data to understand customer behavior, preferences, and lifetime value. This can help inform targeting of the most valuable customers and prove ROI because not all conversions are equal!
Popular CRMs like Salesforce and HubSpot offer powerful features for gathering and analyzing valuable customer data.
Social Media Listening Tools
Monitoring online conversations and sentiment can be a useful scaled qualitative input into product, service, and marketing effectiveness by offering real-time insights into consumer opinions, trends, and brand perception.
Brandwatch and Hootsuite are examples of social media listening tools you could consider utilizing.
What sources are suitable to use depends on your product, your customers, and your marketing mix, but using a variety will help ensure you get a well-rounded set of signals that help direct and improve marketing effectiveness.
Once data is collected, the next step is to analyze insights to determine your marketing efforts’ return on investment (ROI). Some areas to analyze include:
- Tactics – Identifying which marketing activities and tactics drive the highest ROI and contribute most to business objectives.
- Channels – evaluating the contribution of different media channels in reaching target audiences and driving conversions.
- Audiences – assessing whether there are variations in response from different target audiences or segments.
- Messages – determining whether specific ads or messages resonate more with different audiences to inform optimization.
- Campaigns – evaluating performance across campaigns and time to provide benchmarks for future activity.
Businesses can maximize campaign effectiveness and ROI with optimization strategies informed by analysis. Examples include:
- Allocating budget and resources to the most effective channels and tactics.
- Refining messaging and creatives based on audience feedback and performance data.
- Test and iterate on the campaign mix to identify the most impactful variations.
Some general principles help to improve the effectiveness of marketing, these should be planned into action upfront:
Balance the long and the short
Combine brand campaigns with short-term promotional activity in the right ratio for long-term business success. The seminal work of Binet & Field using IPA campaign data provides clear direction for B2B and B2C businesses specific to your particular category.
Pre-test before you invest
Advertising and media costs constitute the largest chunk of most marketing budgets, so getting them right is a priority. Ad pre-testing provides confidence that your investment will have the desired impact on your target audience. The cost of advertising pre-testing research will typically be less than 5% of any major marketing campaign’s budget. Would you pay 5% to ensure the remaining 95% is invested effectively?
Personalize where possible
The more personalized communications, product recommendations, and experiences can be, the better. Seven in ten consumers expect it, and a lack of it frustrates them. As we get bombarded by more and more AI-driven ads and messages, it is becoming even more critical to use data to tailor messages and offerings to individual customers’ specific preferences and behaviors.
Prioritize customer experience
Invest in delivering exceptional customer experiences that complement your marketing efforts. It’s the easiest way to keep customers and should be a priority given the cost of acquiring a new customer can be up to five times more than retaining an existing customer.
Optimize continuously
The digitization of media, the shift to e-commerce, and the utilization of cloud-based data storage have activated an ability to capture marketing exposure and response data in a timely manner. This provides the insights needed for marketers to assess and optimize campaign activity quickly and iteratively to continuously improve ROI.
How to use agile research to optimize marketing ROI
Agile quantitative research enhances both the effectiveness and efficiency of marketing activity. In the following section, we will break down some of the critical use cases where survey research can help improve the ROI of your marketing efforts throughout your campaign lifecycle.
Market research can be a powerful support tool from the start of the campaign planning process. It can help ensure the campaign’s fundamental aspects, such as the strategy and target audience, are on point. At this stage, considerable investment is also made in creative development, especially for multi-channel marketing and TV campaigns. Research can assist in ensuring that creative content is appropriately tailored to resonate with the intended audience and achieve its desired impact.
Defining your audience
Before you consider messaging or channels, you must be clear on who you are trying to reach and what you want them to do. This requires defining your target audience for the campaign, including any sub-segments you plan to target.
The key here is to use first-party data to define high-value audiences, but surveys can also play an important role, especially when targeting new segments. For example, survey research can validate a segment’s value by identifying category behavior, product usage, and purchase habits. Surveys can also be used to understand a new audience’s media behavior or preferences to inform campaign media selection, particularly if your audience is not demographically defined.
Sense-checking your strategy
When starting a new strategic direction or focusing on a new segment, it’s important to ensure that the strategy resonates before investing a lot of time and money in implementation. This can be achieved through quick quantitative surveys using broad campaign ideas or early-stage creative expressions to refine the approach. A 5% improvement in strategic direction can significantly impact ROI when spending millions on a marketing program.
Learn how a global food brand was able to conduct multi-market research in days to inform the choice of a new global brand ambassador.
Pre-testing creative assets
Before you launch, test your messaging or creative with a sample of your target audience to select the one that resonates most so that you can refine it further before investing money in asset production. Pre-testing can improve ad effectiveness by upwards of 20% compared to untested ads. Given that pre-testing costs are a fraction of the money spent on ad production or media costs, this is usually a sensible investment for any major campaign.
Learn how multi-national consumer goods company Reckitt used multi-market research to optimize messaging for its
Enfa infant formula brand.
Assessing brand health
Suppose brand tracking isn’t already in place. In that case, this is the time to do a quick brand health dip or to establish an ongoing brand health tracker so that the impact of campaign activity on critical metrics like awareness, consideration, preference, and brand attributes can be assessed. Brand tracking will help measure the medium to long-term effects of marketing activity. It can provide valuable data inputs for performance modeling like Market Mix Modelling (MMM) that help justify marketing’s contribution to the business.
Once your campaign is live, the work is far from done. Here, optimizing activity is critical to ensure it drives as high an ROI as possible. That may require creative assets and/or media channel tweaks based on advertising performance data or feedback from ongoing brand tracking.
Monitor brand health metrics
For brands operating in dynamic industries or running long-term campaigns, it is vital to continuously monitor your brand’s health while the campaigns are active. This will help you evaluate the effectiveness of your marketing efforts and track the impact of any competitor activity.
Lastly, the post-campaign analysis uncovers the chance to integrate a host of data to form a holistic view of campaign performance and build insights that inform future campaigns. Campaign data from survey research is blended with advertising exposure data, website analytics, sales, and customer engagement records to form a holistic viewpoint of the drivers of success (or failure).
Evaluate performance
Surveys to assess the impact of exposure to campaign activity are a powerful way to prove the ROI of your efforts. These are usually conducted using pre/post-campaign exposure models, digital identity tools to measure exposure, or claimed exposure methods for smaller campaigns. These studies focus on exposure and message recall linkages with changes in awareness, brand understanding, consideration, and purchase intent. They often incorporate channel assessments to help understand which media channels deliver the most significant impact on the audience. The key is to design an approach that reflects the specific objectives of the campaign, and the target audience’s behavior.
Brand health
If you don’t have continuous brand tracking in place, a second brand health dip can be used to isolate the impacts of campaign exposure on awareness, positioning, consideration, and intent and capture feedback on channels or messaging.
Award-winning media agency Atomic212 used a hybrid brand tracker & campaign effectiveness study to help its client assess the impact of a major new campaign.
Start your marketing effectiveness research with Glow
Before launching any marketing campaign, it is crucial to outline how you intend to measure its success, including what role you want market research to play. Successful brands often use a structured research approach before, during, and after marketing campaign activity to help establish success and optimize efforts when in-market.
With Glow’s quick-turn survey capabilities, campaign effectiveness solutions, and a range of other market research services, we can ensure your campaigns are backed by reliable data and deliver the desired results. Take a closer look at what makes our services unique, and start planning your next successful campaign today.
