The stakes are high for marketers in proving their ROI. More data, approaches and vendors exist than ever, but it’s difficult for even people working full time in marketing tech to keep up with the changing landscape. Furthermore, many of these companies use the same words to describe themselves making the marketer’s job to parse the differences even more challenging. Alas, there is no one magic word or endorsement that connotes “This model is the perfect fit for my company and they can actually deliver on their promises.”
The best model fit for your company will depend on your business type (B2B vs. B2C), the types of media you buy, the owned marketing you employ, the reach of your plans, your market penetration and customer visit frequency. For example, if you run a small chain of furniture stores and employ mostly email marketing to customers that on average shop in your store every three years, that will lead you to focus on companies with great email measurement. Alternatively, a large convenience store chain buying outdoor media will have different measurement needs.
Regardless of your marketing budget and goals, when considering ROI measurement options, drill deep on these six success factors:.
1. Accuracy
Don’t take this for granted. There are several factors to consider here:
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a. Is the raw data an accurate reflection of your sales impact?
b. Is the raw data free from errors, bots and fraud?
c. Can the approach measure your incremental impact?
d. Can the approach separate noise in the data from true impact (statistical significance)?
e. What is the implicit or explicit comparison being made to judge whether marketing drove a positive impact? Does that make sense for your customer base? Is it an apples-to-apples comparison?
f. Does the approach measure the short-term impact of marketing or the long term, and does that match your campaign objectives?
g. Does it account for all your sales channels (online, offline, in-app, pickup or delivery)?
2. Scale
a. Is the raw data source big enough to derive meaningful sample sizes for your total campaign and the drill-downs that you require?
b. What percentage of the raw data “panel” is trackable continuously?
c. Is the raw data representative of your total business?
d. For people-based models, what match rates does the vendor typically deliver? This will impact the sample size of your measurement studies.
3. Speed
Time is money. The sooner you know what’s working, the sooner you can impact your business results.
a. How close to real time can you get results?
b. Can you measure results while campaigns are in flight?
c. How are results delivered (PPT, online, API)?
d. How quickly can follow-up questions be answered?
4. Actionable
a. Are results granular enough that you can impact your results?
b. Can you see results by audience, by creative, by ad exchange?
c. Are results timely enough to impact the current campaign? The next campaign?
5. Privacy
a. Do you or your partners have the right to collect the data?
b. To use the data?
c. To share the data?
6. Defensible
a. Does the approach measure sales impact or a proxy for it?
b. Is the methodology easy to explain to other execs?
c. How will the results reflect on your ability to defend your decisions and budget?
d. How does the estimated financial impact of the solution compare to cost?
I’d argue that most marketers try to answer some subset of these questions from the top down. While not illogical, beginning with the end in mind can help you narrow in from the 112 marketing analytics companies listed in Scott Brinker’s 2019 Marketing Technology Landscape, to some manageable subset for consideration and research. After all, if you can’t get the CEO and CFO of your company to trust your ROI measurement — and really believe it in their gut — then it’s probably not the right approach for you.
Nick Mangiapane is Chief Marketing Officer of Commerce Signals, a data insights platform that helps marketers make better decisions in near-real time. Mangiapane is a pragmatic consumer marketer with leadership experience from Procter & Gamble, Newell Rubbermaid, and Ingersoll Rand in addition to Commerce Signals. Mangiapane is an alum of Boston College and Cornell’s business school.
