With today’s world of instant access to infinite information, consumers—not brands—are in charge of how, when, where and if they want to engage with a brand. While there are more channels than ever to engage consumers, it also has never been harder to reach them. The average marketer struggles to keep up, or at least tries not to fall too far behind, now that consumers have assumed a leadership role in defining or influencing a brand’s success.
Combine this with the notion that 37 percent of all ad spend in the U.S. is wasted, and brands are seeking greater accountability such as that found in targeted media (e.g., direct mail). The dynamic, elusive nature of the consumer has made it harder for marketers to reach their audiences and measure the effectiveness of their marketing/advertising spend.
What’s New Is Really Not So New
This “new” world of online and offline media requires new skills, technology and processes in order to understand how consumers learn, discover and evaluate options when deciding to buy. Those new capabilities are also necessary to measure how media and channels work together to drive consumer purchases. Marketers are tasked with understanding consumers in multiple dimensions such as preferences, geodemographics, economics and multiple end-user devices, while facing a never-ending race to keep up with the latest advances by empowered consumers.
In the “old” world, direct mail got credit for a sale if a consumer made a purchase within 60 days to 90 days of a direct marketing event. It’s not so easy now, because no single medium gets sole credit for a sale today. All media have to share the contribution for creating a sale. And measuring this is what enables the precision of consumer marketing in this new world that connects with the principles of direct marketing. Making sense of how all these channels and different consumer touchpoints logically work together is the big challenge where media attribution is the art and science of measuring the statistical contribution that each layer of media/channel activity has on creating the final output: a sale.
One “new” approach to increasing engagement and measuring ROI is to borrow the same principles that direct marketers have long understood in the world of direct mail and email:
- Identify your most valuable audience and direct spend toward those segments most likely to buy, while
- Improving the relevance of messaging, offers and the overall customer experience.
Direct marketers have been doing this for decades; specific target audience identification and measurement of individual level stimulus and response. Modern marketers face a more complex multichannel marketing environment where the consumer is boss. To delight consumers while optimizing marketing ROI, she must be able to identify, measure and evaluate consumer engagement and drive continuous improvements through closed-loop learning and promotional effectiveness that increases understanding at a granular level.
What One Marketer Can Do, Another Marketer Can Do
Getting the formula right to optimize your marketing spend across media/channels and products requires improving the juxtaposition of TV/cable, radio, display, search and direct marketing. To improve results and reduce wasteful spend requires a couple of things first.
- Leaders must be able to access and use the various customer data in their respective silos.
- Invest in the analytical tools and advisory services necessary to identify your high-value customers. Once you have your target audience and their requisite insights identified, then it’s time to go to work.
For example, a large financial services company has multiple products and lines of business related to wealth management, banking, credit cards and more. It has separate silos for brands, products and channels. A customer would receive various offers from multiple divisions, while none of those groups knew what the other was doing.
The marketing leader incentivized marketing teams to talk with each other to see how they could cross-pollinate, increase collaboration and coordination across product and media. The resulting product bundles increased efficiency and revenue while gradually decreasing internal bickering. Creating a customer-focused organization can be difficult, but this effort changed the company. Now they are hitting their stride in understanding how product portfolio performance is impacted by marketing promotions for individual products within that portfolio of products, as compared to multiple, individualized products. All campaigns must now include an optimized media plan.
Walk, Crawl, Run and Then Run Faster
Creating this vision to optimize media and marketing will be a recurring, real-time and integrated component of all advertising. The objective is to develop capabilities that enable brands to reach and engage high-value customers and prospects and develop rich analytic models and insights to serve them relevant, engaging and personalized experiences.
To accomplish this, marketers need to connect their marketing systems across the range of products and customer engagement channels so that when it matters most, when you have to optimize the next customer experience, you’ve made the right media investment decision. Simultaneously, marketers must optimize their marketing return on investment to fulfill this vision of high performance marketing and advertising in our digitally connected world.
This must be done while balancing customer demands and organization goals. Throughout the journey, you’ll identify ways to reallocate budget from less profitable audiences and media channels to other, more profitable ones as you measure and refine your tactics.