Ignorance is not bliss
As a marketing manager (we do most of our stuff online) I have a budget to look after and my main goal is to maximise the return from my marketing investments. I have lots of tactical choices available – banner ads, search, print, emails, newsletter sponsorship, social media and so forth. To decide where to allocate my hard-earned budget, I generally look to the history of my various campaigns and spend more where I know I will get a better return.
The hidden problem for marketers is that many of the measurement tools being used to determine campaign outcomes are totally bogus and so the results being used to determine future marketing investments are false. Truly, you could be operating in a vacuum of blissful ignorance and not even know it!
Most of todays online web analytics tools, including Google Analytics, Omniture, Webtrends and Yahoo Analytics default to what is known as last click attribution – that is, they count the value of the conversion (sale, booking event etc) towards the last marketing activity that happened. Last Click attribution is good for measuring conversion events but will not tell you which campaign brought the customer to you in the first place – for that you would measure the First Click. And what about the other campaigns along the way that influenced the conversion? How do you measure these and make sure they get some credit as well?
The key takeaway is that depending on the attribution model you are using, your return on investment (ROI) and return on ad spend (ROAS) may vary dramatically, and may lead you to make different (and possibly very wrong) decisions about how to best optimise your marketing efforts.
Whilst there are some very advanced attribution techniques being deployed by some companies, the general consensus today is that an approach looking at First, Last and Average Click, side by side, is a sensible and achievable approach – and it can be done with minimal effort (and possibly a spreadsheet, if you must). Such an approach will show you which campaigns are working better for acquisition, influence and conversion – you can then weight the results to drive the campaign mix you are looking for.
A recommended action plan:
- Find out which attribution model you are currently using,
- Re-assess your current marketing program now that you know what your are really measuring,
- Implement a First, Last and Average Click attribution model for your business,
- Reconsider your mix strategy for acquisition, influence and conversion,
- Make more informed and effective investment decisions,
- Bask in the glory of knowing you have improved your marketing effectiveness, and
- Spend your ‘Management By Objective’ bonus!
This is my personal blog. The views expressed here are my own and do not represent those of my employer, Coremetrics.