Marketers that understand the key drivers of digital marketing effectiveness are already one step ahead. From culture and resources to investing in data and skills, this chapter explores how to create environments that are conducive to effectiveness, and how this supports measurement.
- Developing an Effectiveness Framework
- Secure senior level support and nurture a culture of effectiveness
- Make the case for measurement resources
- Invest in data skills and internal teams
- Adopt a test and learn approach
- Build a solid data foundation supported with the right technology
- Invest in first-party data and providing a value exchange
- Deliver a strong digital experience
Developing an Effectiveness Framework
Selecting the right measurement approach will come down to a company’s strategy being aligned with its measurement approach. Regardless of the approach selected, there are some key drivers that will support its success. This includes senior level support and sufficient resources, with teams working together across the business towards clear KPIs and goals. Companies should develop an effectiveness framework to support their measurement approach, one that is grounded on solid data foundations and a culture of test and learn.
Secure senior level support and nurture a culture of effectiveness
To move beyond a tactical view of performance, it is important for companies to have senior level support in order to build an effectiveness culture that combines techniques for short-term tactical optimisation with longer-term strategic goals.
Building an effectiveness culture requires silos to be broken down and for there to be alignment between marketing and other parts of the business on how marketing effectiveness is assessed. In particular, trust needs to be built with finance teams through accurate forecasting of longer-term outcomes, supported with more frequent reporting of short-term metrics that align with these.
Direct Line Group has won two IPA Effectiveness Gold Awards. Describing the key drivers to the company’s success, Ann Constantine, former Head of Insight, Marketing Effectiveness and Customer Experience at Direct Line Group, highlights how this has required long-term commitment across the organisation, a focus on finding the right talent, working with agency partners and getting the wider business on board. “The idea at Direct Line is for these effectiveness conversations to be shared with peers across the organisation, who can then feed back.”[1]
Diageo is another organisation that has made its commitment to marketing effectiveness clear, driving a full culture shift within the business. One article describes how the company has created a marketing effectiveness ‘muscle’ and driven through culture change.[2] The business aims to ensure every single one of its marketers understands and uses the tools they have in place. “It’s not a marketing efficiency programme,” says their Vice President of customer value creation and end-to-end commercial planning. “We are not optimising for ROI, we are investing to deliver against our growth opportunity.”
Effectively communicating the success of marketing also plays an important role in gathering support across an organisation, to demonstrate the value of marketing and the role it plays in driving a business forward. However, a concerning finding from Marketing Week and Kantar’s Language of Effectiveness survey showed that 15% of brands say the results of their marketing campaigns are not communicated to the wider company.[3] Yet, in not doing so, over half of respondents (50%) said they feel demotivated when the success of campaigns is not actively communicated with the wider business. There is a clear improvement opportunity to be gained by responding to this. This is particularly the case in the charity sector where it is important to show how marketing is contributing to increased fundraising.
Warren Fiveash, Head of Marketing at the Teenage Cancer Trust, describes how they work hard on the storytelling behind the numbers to demonstrate the impact that campaigns have had both in the short- and long-term.
“There’s a joined-up process in terms of how we plan and then how we make sure we’re communicating our insights across teams, so not just from a marketing point of view, but across all the other teams. We understand what the need is across the organisation, from the frontline and fundraising point of view, and what we need to do to improve our services. Then, how can we help from a marketing point of view to achieve those things?”
Fiveash highlights how it works both ways, as other departments must be clear ahead of time about their needs to ensure they receive the metrics which matter most. Another key point raised by Fiveash is the importance of being open when work has not necessarily gone to plan, in the spirit of learning and creating a culture of transparency. “It’s not about failure, it’s about learning,” he said.
Marketing Week | Why Sharing Marketing Effectiveness is Key[4]
Overall, internal messaging can be crucial in getting the wider business engaged with the effectiveness agenda and approach. Teams should all be working together to understand the impact that marketing has and the role that they play in supporting this, including what they need to do.
Make the case for measurement resources
Often when companies are looking to make efficiencies in challenging times there is a danger of making cuts or changes to what marketing activities should take place, without the right analysis to guide their decisions. Inadequate funding can mean there is not enough resource to support the effective measurement of performance.
“Under spending on measurement is a false economy, as more money will be wasted through incorrect revenue, margin and ROI attribution than it costs to measure and correct the marketing mix.
“We find brands that spend around 3–5% of their marketing budget on measurement generally achieve savings and ROI gains far in excess of that in return. Companies should take into consideration that it takes time to get a measurement capability set up and develop a proper test and learn process which leverages that capability. But it has to be set up ahead of major risky marketing investments, and not as an afterthought.”
Gabriel Hughes, CEO and Founder, Metageni
To support the case for tools such as incrementality measurement platforms (as opposed to attribution) or cookieless solutions, Kumar Amrendra, Head of Digital Marketing at Sky UK Ltd, suggests companies can assume an incremental efficiency of at least 10%. “If a company puts that back into the context of the bottom-line impact and investment that they have made in marketing, the tools pay for themselves within the year or multiple times within the year, and the benefit outweighs the cost.”
While some solutions such as econometric modelling are more expensive than other techniques, it also comes down to a company assessing the balance between the budget being allocated to marketing activities and what proportion of this is being spent on measuring success.
Invest in data skills and internal teams
As the technical and regulatory environment in which digital marketing exists continues to change, it is important for marketers to be in a position to respond to these by investing in the right skillsets internally and to be equipped for changes moving forward.
Marketing Week’s 2023 Career and Salary Survey revealed that data and analytics is the most significant skills gap in marketing departments (Figure 1).[5] Bridging this skills gap should be a priority for both individuals and teams.
Figure 1: Has the business identified any skills gaps in the marketing department?
Source: Marketing Week 2023 Career and Salary Survey[6]
Data skills can no longer sit in isolation in research or insight teams. Marketers must train and recruit to ensure that both specialist and generalist data capabilities are represented throughout the marketing function. See Econsultancy’s analytics and data training hub for relevant courses, and the report on Winning the Race for Digital Skills for further guidance.
Adopt a test and learn approach
It is important for marketing teams to be testing frequently to optimise outcomes. This requires marketers to define what success looks like for the campaign and set clear objectives and KPIs. The importance of doing this was reinforced by the interviewees for this report.
“Find the North Star objective which focuses everyone around what you’re trying to achieve within that campaign. Secondly, determine what is your hypothesis for a campaign and how can you really learn from it. Even if a company doesn’t have the campaign spend for a brand lift study, you can run A/B tests to understand if people are achieving those high-value actions or not based on your landing pages, or based on the content that you have. Finally, being able to build your first-party data stores is key to understanding effectiveness in the long term.”
James Sharman, Northern Europe Digital Acceleration Lead, Haleon
“Set specific objectives. Build an understanding of what types of marketing impact on specific types of objectives. Act on that understanding, then measure the specific objectives you set. You want to have a view of whether a campaign cut through and was engaged with or remembered, whether it drove a shift in brand health, and whether that laddered up to an increase in sales. Econometric or marketing mix modelling studies can then help attribute incremental sales to specific activities.”
James Hurman, Founding Partner, Previously Unavailable
Teams should adopt a test and learn mindset and develop habits that help them quickly turn assumptions into validated learning. Beginning with a hypothesis supports this approach. A hypothesis is a statement that aims to explain an occurrence or observation of some kind, but it should be one that is both informed and testable. Having a clear process for testing a hypothesis can help a company deliver a more effective campaign at the outset.
“We have a framework which involves setting out a clear objective and hypothesis, selecting KPIs, optimising creative, and then a test and learn phase to identify what is the experience when a consumer lands on our website and select the measurement factor. This is to determine what are we trying to learn and measure, rather than just looking at the data. One thing we try not to do is change the measurement factor once we’re live with the experiment. We almost lock the campaign charter away and then run the experiment and refer back to our original KPIs to measure whether it has been successful.”
James Sharman, Northern Europe Digital Acceleration Lead, Haleon
Barry O’Reilly’s model for the structure of a hypothesis encompasses three key elements that every hypothesis should have: the idea or theory, the outcome, and the measure by which a team will identify success or failure. For example:
- We believe <this capability>
- Will result in <this outcome>
- We will have confidence to proceed when <we see a measurable signal>
While this hypothesis structure is commonly used in product strategy and development, it is a useful way of framing marketing-related hypotheses. A simple example of a marketing hypothesis set out in this way is:
- We believe that changing the image on the landing page
- Will result in a higher number of onwards customer journeys
- We will have confidence to proceed when we see a measurable uplift in clickthrough rate
Econsultancy | Product Strategy and Marketing Best Practice Guide
ASOS is a brand that has adopted an always-on testing programme, and they triangulate a number of measurement techniques to support this. They have a programme using a variety of attribution models to measure attributed revenue and they use an always-on incrementality testing approach. This is based on either a geographic basis, where they’re holding out parts of their programme in certain areas, or where they are using Google’s full-funnel lift measurement.
One example is the ASOS video action campaign in Canada. On the back of this the brand saw a 45% increase in incremental conversion, however as ASOS was measuring the full-funnel impact using search and brand lift, it saw that it had a 200% brand lift in Canada, and a 300% incremental search lift.
Overall, while ASOS ran a performance campaign, because of the thoroughness of their measurement approach, it was able to measure the upper-funnel and mid-funnel impact of that programme. This provided the brand with an integrated marketing perspective where brand and performance merge.
Google | How ASOS is Driving Growth[7]
Build a solid data foundation supported with the right technology
With any measurement approach, the quality of the data that is used for the analysis, or to train a model, will impact the outputs and the clarity of the picture on what is driving effectiveness. Steven Silvers, EVP of Global Creative and Media Solutions at Kantar, worries marketers do not think enough about the difference the data makes. Silvers notes the importance of data quality as well as data governance: “The ethical collection of data and how it is used needs to be a consideration. That also relates to how vendors have collected the data.”
A solid data foundation enables companies to have confidence in the data that is used for measurement and analysis, and for true value to be realised.
Econsultancy’s Data-Driven Marketing Best Practice Guide describes how a solid data foundation can be built up around three critical elements: collection and storage, governance and cleansing.
The guide further outlines the stages of maturity involved in adopting a data-driven approach across an organisation. A summary is provided below of what is needed in terms of the people and expertise required, the processes that need to put in place, how technology supports this and how it is driven by the right strategy.
Table 1: A maturity model in data-driven marketing
| Basic | Enabled | Advanced | |
| People |
|
|
|
| Process |
|
|
|
| Technology |
|
|
|
| Strategy |
|
|
|
A key attribute of an advanced organisation, in terms of technology, is the ability to integrate data across the organisation. When it comes to collecting and bringing together data, customer data platforms (CDPs) are becoming increasingly popular tools.
A CDP can help organisations bring different data sources across the organisation together in one place, as illustrated in Figure 2. This enables companies to combine their first-party data, behavioural data, along with data from other partners, where consent has been given, in order to build customer profiles with a single unified view across the organisation. The data can then be shared for a number of different business objectives from measurement through to targeting and delivering personalised marketing.
Figure 2: Role of a CDP
Source: Econsultancy
CDPs also keep a ‘trail’ of where data has come from, providing a record of data sources and a record of where data is passed to. Data known about an individual can also be continually updated. This can help a company ensure compliance against various regulations. CDPs support:
- Data governance: The ability to set rules and policies around data collection, storage and processing, ensuring that data is collected and used in compliance with privacy regulations.
- Data management: Data collected can be managed and controlled, including the ability to comply with any request to delete or anonymise data.
- Consent management: Customer consent for data collection and processing can be managed and tracked, ensuring compliance with privacy regulations.
Companies should focus on building up their own CRM data and bringing all data sources together to create a single view of the customer. To learn more about how a CDP can help support this, see Econsultancy’s Customer Data Platforms Best Practice Guide.
Invest in first-party data and providing a value exchange
As discussed in Section 4, the technical and regulatory changes in the industry have driven a renewed focus on first-party data and the need for companies to build up their own data sources where customers have proactively shared information. Having access to their own data sources will help a company to establish a solid data foundation, as discussed above. First-party data can then be used to help measure the effectiveness of a company’s digital marketing and drive more effective campaigns through better targeting, personalisation and more relevant experiences.
The value that first-party data provides to companies is evident in the findings from a study conducted by Google and the Boston Consulting Group.[8] The study was designed to look at how companies achieve success using first-party data strategies. It found that companies using first-party data for key marketing initiatives saw an uplift in revenue of up to 2.9 times, compared to those that did not, and saved up to 1.5 times in costs.
To build up sources of customer data, companies should focus on encouraging customers to share their data by providing a strong value exchange. Econsultancy’s Future of Marketing report shows that marketers are still struggling to demonstrate clear value to the customer, with just under half (49%) of marketers agreeing with the statement, ‘My organisation offers a clear value exchange in return for customers sharing their data’. Customers are often willing to share their data if they are provided with something in return for this.
Some brands will have access to more first-party data than others, in particular those in financial services or travel, where data is collected as part of the purchase process or account set up. However, there are still ways for businesses in other sectors, where they may not have a direct relationship with a customer, to collect first-party data through competitions, polls, quizzes, product selectors, etc., and demonstrate a value exchange.
For James Sharman, Northern Europe Digital Acceleration Lead at the consumer health company Haleon, it is about trying to understand the value exchange to give consumers in order to get that first-party data so as then to be in a position to use it elsewhere and drive effectiveness.
“Being a healthcare business, most of what we what we do is around product recommendations, or providing help with different health conditions. A good example of a value exchange to the consumer for their data is our Voltarol Movement Coach, which launched this year. It helps people in pain recover from injuries, offering 70 pieces of content including videos and exercise plans.[100]
Figure 2: Voltarol’s Movement Coach offers a clear value exchange to consumers
Source: Haleon
“People can complete a quiz and input details about their pain in order to receive a personalised movement plan. It’s a great piece of content, which is totally free for the consumer, but we get to understand demographic data as well as behavioural and lifestyle data in terms of severity and where someone has got that pain. Before we would have had to make inferences based on clickthrough rates, but now we can start to see in our first-party data those different touchpoints and understand there are over 40% of our consumers suffering with back pain and only 2% with wrist pain. We can then start to adjust our campaign activity based on these insights and our communications with our customers.
“We saw a 99% completion of the experience and at an overall level, the campaign cut through and drove unaided and aided brand awareness of Voltarol. We very successfully landed the message association, strengthened all brand attributes and significantly strengthened lower-funnel metrics of brand consideration and purchase intent.”
James Sharman, Northern Europe Digital Acceleration Lead, Haleon
The growing importance of first-party data has created a need for marketers to consider the different ways in which they can proactively acquire it in a privacy-compliant manner. This requires a good knowledge of privacy requirements, but also good judgement and creative thinking around understanding the value exchange that will encourage more customers to submit first-party data. Some useful best practice techniques are highlighted in Econsultancy’s Data-Driven Marketing Best Practice Guide, as outlined below.
- Ensure clarity of ownership and responsibility for privacy and regulatory compliance in the collection and use of first-party data to avoid confusion.
- Integrate privacy awareness into everything that the team is doing around customer data, including technology and processes.
- Utilise a broad range of activity and touchpoints to drive collection of first-party data. For example, paid-for activity and campaigns are good opportunities for data collection if the value exchange is right and it is made simple for users.
- Recognise that the objective is not always to collect as much first-party data as possible. Although quantity is important, so is quality, which means that the team should be focused on collecting the first-party data that is most useful for the business and enhancing customer experience.
- Understand that value exchange is a nuanced concept – the more engaged users are, and the more benefits that users see, the more likely they are to submit data. Data can also be collected and enhanced over time. For example, a retail or subscription service may only require basic user data at sign-up stage but can collect much deeper behavioural and interaction data over time as the customer uses the service.
Econsultancy | Data-Driven Marketing Best Practice Guide
Speaking to a panel hosted by Meta, Nic Travis, Head of Digital Marketing at Lloyds Banking Group, highlighted the importance of understanding when it is the right time to ask a consumer for their data, as well as explaining why it is necessary and the value exchange behind it.[9] The bank changed its approach recently, he said, because it wanted to avoid the appearance that it was a ‘box-ticking’ exercise for the brand.
“When a customer is out of the product application journey and downloading our app, we deemed that’s the right context for permission. It’s then a relationship journey rather than a purchase journey. It becomes: ‘How can I get the most out of this product that I bought? How can I get the most out of this service?’ And therefore, asking for consent to deliver personalised advertising in that context is the appropriate place. We’ve seen very high opt-in rates from that approach.”
Nic Travis, Head of Digital Marketing, Lloyds Banking Group | Marketing Week[10]
Marketers can use a range of different techniques to collect first-party data and it is important to continually refine approaches. As well as providing a clear value exchange to customers, using progressive profiling strategies and asking for just the minimum information at the outset can also help to improve the chances customers will be willing to share their data. Marketers can then use additional campaigns to collect additional data from users.
Deliver a strong digital experience
The effectiveness of a company’s marketing campaign is influenced by the experience a user receives when they reach a company’s website, and their level of engagement with a product or service. A company may run an effective advertisement or campaign which drives a user to visit their website, but this then needs to deliver on the expectations of the user.
According to Econsultancy’s Digital Trends research, conducted in partnership with Adobe, close to half (42%) of practitioners believe their customer experience sometimes falls short of customer needs, with only 7% of practitioners considering their organisation’s digital CX to be exceptional and able to surprise and delight customers.
“Companies need to focus on the experience and delivering on the basics. With reduced capacity for granular targeting, brands can refocus on creating quality content and superior user experiences to organically attract and retain audiences. Brands are putting more emphasis on channels they can control, like email marketing and mobile app analytics. By enhancing the user experience on owned channels and incentivising actions (e.g. newsletter sign-ups), companies can gather more data directly.
“The evolving landscape necessitates innovation, a deeper connection with audiences and a renewed emphasis on privacy, content quality and user experience.”
Amy Blasco, Partner, Enterprise Data, Experience and Marketing Lead, IBM
Focusing on the experience the customer receives when they arrive at a brand’s website can help to drive more effective campaigns, which is a point made by James Sharman, Northern Europe Digital Acceleration Lead at Haleon. “An example is our Corsodyl product for gum disease, where rather than taking people direct to a product information page, we take them to a gum health tool. The consumer can look at pictures and indicate their symptoms and it will tell them about the health of their gums, whether to speak to a health professional, or to try a mouthwash if it is not too severe. Having those high-value actions and those experiences on our website is really helping our brand managers look at the website differently, which in turn will help build out our first-party data strategies.”
- Successfully driving digital marketing effectiveness depends on marketers’ ability to build the right foundations and align the measurement approach with the business strategy.
- Secure support from the leadership team to create a culture of effectiveness, whereby the whole business understands the importance of combining short- and long-term goals.
- Identify skills gaps in the marketing team and fill them, whether that involves upskilling internally or recruiting externally.
- Ensure the right people, processes, technology and strategies are in place to enable a data-driven approach across the organisation – use Econsultancy’s maturity model to determine how advanced the business is.
- Storytelling is an effective way to bring the data to life in an easy to understand way, thus engaging the wider business with effectiveness.
This guide is based on primary research which involved exploring findings from two reports:
- Econsultancy’s 2023 Future of Marketing report, which was based on a survey of 835 client, vendor and agency-side marketers. The survey was fielded to Econsultancy and Marketing Week’s audiences between 9 June and 3 July 2023.
- The Language of Effectiveness 2023 report has been produced using responses to an online survey of 1,369 qualifying marketers conducted by Econsultancy’s sister brand Marketing Week between 27 March and 28 April 2023.
In-depth interviews were carried out with industry experts. Econsultancy would like to thank the following interviewees for their invaluable contribution of time and expertise to this guide:
- Kumar Amrendra, Head of Digital Marketing, Sky UK Ltd
- Amy Blasco, Partner, Enterprise Data, Experience and Marketing Lead, IBM
- Laura Chaibi, Director, International Ad Marketing and Insights, Roku Inc
- Sebastian Cruz, Regional Digital Marketing and Media Director, Shiseido, Asia Pacific
- Gary Danks, General Manager, AIM, Kochava
- Mauricio Ferreira, Marketing Effectiveness Lead, Confused.com
- James Hurman, Founding Partner, Previously Unavailable
- Gabriel Hughes, CEO and Founder, Metageni
- Dr Grace Kite, Economist and Founder, Magic Numbers
- Chloe Nicholls, Head of Ad Tech, IAB UK
- Roxane Panopoulos, Group Manager, Regional Measurement & Insights – Netherlands and Nordics, Snap Inc
- Marina Peluffo, Head of Business Intelligence, Prima (speaking as industry expert)
- James Sharman, Northern Europe Digital Acceleration Lead, Haleon
- Steven Silvers, EVP, Global Creative and Media Solutions, Kantar
Lynette Saunders is a Senior Analyst at Econsultancy, where
she works on delivering industry-leading research, briefings and
reports for the digital marketing industry and speaks at a number
of external conferences.
Lynette’s previous experience includes delivering web analytics, measurements and insights, as well as leading usability and
customer experience programmes focusing on improving the
overall online customer experience for Cancer Research UK
and the Royal Mail Group.
