Every marketer knows that measuring the results of their marketing efforts is key to success. If you don’t examine and analyze the performance of your email or ad campaign, industry event, website relaunch or other marketing effort, it’s impossible to know how to focus your resources moving forward. The question is HOW do you measure performance?
Turns out the metrics marketers use to gauge the impact of their marketing outreach have changed dramatically over the past couple decades. This is due in part to the introduction of new marketing methods and channels, but it’s also because we’ve gotten much better at measuring. Today’s marketing tech tools enable us to examine the performance of our campaigns at a highly granular level – and even proactively predict whether or not they’ll be successful, and attribute conversions to specific activities and content.
Let’s go back in time to learn how marketing metrics have evolved, and which metrics we should be focusing on now.
Learning to Reach Consumers
Since the 1400s when the printing press was introduced, merchants and business owners have advertised their goods and services. The first print advertisement was created in the 1450s, and the first magazine ad was published in Benjamin Franklin’s General Magazine in 1742. Shortly thereafter, people began to acknowledge the power of print advertising, and direct mail was introduced in 1862. Next came radio and television ads, broadening the reach for advertisers. The approach to marketing during this time was mostly “spray and pray” – put out a general message and cross your fingers someone will respond.
Soon enough, marketers realized they could improve the ROI of their marketing outreach if they targeted audiences with tailored ads and messaging, and they set out to understand the customer. Surveys and focus groups helped them hone their efforts, learn what resonated with their target audiences and fine-tune their outreach.
Decades later, digital marketing emerged and completely changed the game. Outreach is now much more cost-effective, targeted and immediate, and can be altered rapidly to improve performance, which is a big reason why measurement is so critical today.
Adding Ingredients to the Marketing Mix
In 1964, Neil Borden coined the term “marketing mix” which identified four key ingredients to understanding the impact of a product or service on customers and market that product or service effectively: product, promotion, place and price. This concept evolved into the Marketing Mix Model, and marketers were able to develop some insight into how to put the right message in front of the right consumer at the right time – what evolved into what’s now called segmentation. The model helped brands understand how much each marketing activity contributed to a sale, so they could optimize spend.
With the invention of smartphones and the Internet, marketing changed forever. Whereas the MMM approach relied on measuring performance over time and only delivered broad, somewhat ambiguous insights into the performance of marketing activities, digital technologies provided granular insight into how consumers were engaging with ads, websites and email campaigns. These behaviors could be tracked, providing tangible data that could be quickly analyzed. As such, the practice of marketing analytics emerged.
The first digital channels – websites and emails – were just the tip of the iceberg. Digital ads are now pushed to innumerable channels – text, social channels, digital displays and others. When a consumer clicks on an ad, it’s easy to determine where the click came from. Being able to identify where a lead originated gave marketers insight into what ads worked best, what channels worked best, and who should get credit for the lead. As a result, attribution models emerged to help marketers prioritize and allocate funds to activities that will deliver the most bang for their buck.
So, What Metrics Matter Now?
In the past, the only way to measure the performance of a sign, ad or piece of direct mail was to wait until the leads came in. You’d launch a campaign and see how many responses it generated. Once your leads converted to sales, you could calculate the percentage of closed deals versus flyers mailed or ads published. This was a rudimentary way to gauge performance, and didn’t really tell you anything about what worked or what didn’t – or how to fine-tune your messaging and creative to improve conversions.
Over the past 10-15 years, marketing automation platforms such as Marketo and Eloqua have evolved to enable extremely granular details about marketing campaign performance, and the modern marketer can now leverage a variety of performance metrics to ensure their efforts are effective. Advanced analytics provide insight into a variety of engagement, performance and customer KPIs for all marketing channels, including:
- Cost per lead
- Cost per acquisition
- Customer lifetime value
- MQL to SQL conversion
- Open rate
- Click-through rate
- Page views
- Downloads
- Bounce rate
What’s more, behavioral data can now be collected from smartphones (with consent) to provide insight into the customer journey. This information helps marketers be proactive about how to best reach the customer with ads and messaging that resonates with them, closer to the point of purchase.
Use Marketing Metrics to Demonstrate Your Impact
Whatever marketing metrics you’re most interested in tracking, BDO Digital can ensure you have the right tools and resources to maximize your insights. Our Reporting & Analytics services can be customized to your business needs, to help you demonstrate the measurable impact of your marketing campaigns to your organization’s bottom line. Contact us today for a consultation.
The post Now versus Then: The Evolution of Marketing Metrics appeared first on DemandGen.
