Too often brands track what is easy to measure instead of the numbers that actually indicate success. They view their KPIs in isolation and ignore brand-lift metrics like purchase intent and favorability, focusing instead on direct-response figures that lend themselves to efficiency.
Unfortunately, this analytics-obsessed, quarter-by-quarter mentality causes too many brands to obsess over performance-driven metrics instead of marketing effectiveness.
Take, for example, Adidas, whose global media director recently admitted that a focus on ROI led the company to overinvest in underperforming channels to the detriment of its overall brand-building efforts.
Or, as John Paul Getty summed up the problem: “It’s no use sharpening the bit if you’re drilling in the wrong place.”
Take a holistic approach
At its best, marketing should be about driving a company forward, promoting new products, projecting a new vision, reaching new consumers and telling a new story. It should be an active mission.
But it is important to note that marketing represents only one part of most companies’ profit-driven strategies. Truly holistic thinking requires each division to pull every potential growth lever and not just rely on marketing to do the job. Ideally, brands should isolate the incremental impact of individual marketing channels to make informed decisions about where to spend.
Put measurement in order
But not every marketer is there yet. Most make one of two strategic mistakes: They view effectiveness and efficiency as mutually exclusive rather than complementary objectives, or they focus on efficiency before figuring out their goals. They elect to optimize towards a KPI without first making sure it’s the right one. Simply put, they do things out of order.
What’s so wrong with these strategies?
For starters, marketing is not an either-or decision. There’s a misperception that the more a brand employs sophisticated modeling and attribution techniques, the less it needs brand measures. But this could not be further from reality.
If done correctly, predictive marketing analytics is completely customized for a brand’s unique needs, goals and data availability. It also incorporates performance and brand-lift data.
Don’t sacrifice effectiveness for efficiency
These strategies cover the big picture, but unfortunately, it’s in the on-the-ground tactics where effectiveness can end up being ignored in favor of efficiency.
For example, a common challenge among big brands is a lack of organizational alignment about which metrics matter most. This can occur when companies take a bottom-up approach to tracking efficiency versus a top-down one. In this scenario, each division defines success using its own channel-specific KPIs (the ecommerce team cares about sales, the email team cares about leads, etc.)
On the flipside, CMOs can lack an intimate understanding of how different ad vehicles work, resulting in ill-informed or biased decision-making.
The fact that there are conflicting points of view within a company about what success looks like can cause problems for brands. You can’t optimize towards efficiency if what you define as efficiency varies.
Using an advanced marketing analytics solution gives you a holistic look at the true influence of all customer touchpoints. Having this 360-degree view into marketing performance leads to better conversations between a company’s various divisions and more constructive decision-making.
But this solution only works if CMOs start by rethinking the internal silos that can lead to a disjointed and efficiency-above-all approach to marketing measurement. Once your teams are aligned on what success looks like, you can find out what’s working by adopting a marketing analytics strategy that gives you an accurate, complete—and holistic—picture of performance effectiveness across channels. Having the right tools and organizational alignment is essential to effective marketing, but it doesn’t have to come at the expense of efficiency.