How to Measure Digital Marketing

Metrics for Assessing Impact and Designing Success

L. Flores

• Publisher: Palgrave Macmillan
• Year: 2013
• Print ISBN: 9781349464883, 9781137340689
• eBook ISBN: 9781137340696
• Topic: Business
• Subtopic: E-Commerce
• Index: Business

Measuring the Success of Digital Marketing explains how to determine the success of a digital marketing campaign by demonstrating what digital marketing metrics are as well as how to measure and use them. Including real life case studies and experts viewpoints that help marketers navigate the digital world.

part 1

Devising a measure of effectiveness applicable to digital marketing

Specific, interactive and “always on,” digital marketing imposes a new order on all market actors – advertisers, media agencies, advertising agencies, and research institutes. In this perspective, it is important to grasp its characteristics and potential, and to do so upstream and downstream of the marketing strategy, from the development of awareness and the image of a brand through to the acquisition of new customers and/or the retention of existing customers. Such are the marketing objectives that dictate the choice of metrics and key performance indicators (KPIs) needed to measure the effectiveness of digital marketing.

chapter 1

Definitions of and actors involved in digital marketing’s return on investment

Executive summary

• The emergence of the Internet – a wholly new medium – and its implications are probably the biggest change that marketing has faced since World War II. It is no longer just a fad, but a truly new order.
• The effectiveness and return on investment (ROI) of digital marketing are often difficult to assess, although in theory, they are highly quantifiable. Counting is not the same thing as measuring, and therein lies the great paradox of digital.
• All the stakeholders in the digital ecosystem must agree to establish a common language and a set of effectiveness metrics understood by everyone – the sustainability of digital marketing depends on this.

Defining digital marketing

The term “digital marketing” appeared only recently in the world of professional marketing and communication. It refers to the promotion of products and brands among consumers, through the use of all digital media and contact points.

Although digital marketing has many similarities with Internet marketing, it goes beyond it, since it frees itself from the Internet’s single point of contact and accesses all so-called “digital media,” including, for example, mobile telephony (SMS or applications) and interactive television, as the communication channel. The term “digital marketing” therefore seeks to bring together all the interactive digital tools at the service of marketers for promoting products and services, while seeking to develop more direct and personalized relationships with consumers.

An advanced form of marketing

Far from following a fashion, with marketing and advertising becoming increasingly interactive, digital marketing covers ever more techniques and methods generally derived from traditional marketing, for example direct marketing, since it can communicate individually with a target but in a digital way. At present, its role is also tending to expand and go beyond simply the “promotion” of marketing products to include customer marketing or consumer commitment, that is, making available various ways of serving customers so as to maintain and develop the relationship, loyalty, and commitment of certain customers in the co-creation or co-promotion of offerings.¹

In the coming years, marketing will be digital or nothing. Capable not only of selling but also creating loyalty and even “fanaticizing” customer relationships (in the Facebook sense), with digital marketing, the marketing of “the good” and “the link” are equally important, complementary, and essential for attracting and retaining increasingly “connected” consumers and for ever more fragmented media uses.

Toward a mix of push and pull

Marketing specialists are no doubt familiar with the expressions “push” and “pull.” They refer to communication actions implemented by brands which, in the case of push, will enable them to reach their targets. Whatever the goals set – to make known and develop the image, or to acquire and/or retain customers and prospects – brands are first and foremost senders of messages. Each brand has a number of ways – the media – to implement its own marketing communication policy.

Action levers

Until relatively recently, the “mainstream media” or mass media, such as television or the press, saw themselves as relays for the brand message.

With the Internet, it is now possible to advertise on websites and thus “push” a message to a relatively large and qualified audience, in accordance with affinity with the target, thanks to the audience of media plan sites, and also to send a message personalized to a greater or lesser extent, by email or via an SMS, for example, to a set of prospects or customers.

Digital media, therefore, like traditional media, allow push marketing actions to be implemented but also – and this is what gives them their great specificity – to authorize the implementation of pull marketing actions, where the brand invites rather than, as push can too often give the impression, “imposes” its presence.

Think interactive

Inviting the audience to participate, making one’s brand content always available, or getting Internet users to create or co-create their own brand experience are all opportunities that social media, such as Facebook, as well as brand sites, YouTube videos or blogs and forums make possible.

With the Internet and digital media, it is often said that communication, too often confined to a monologue, has finally acquired its full meaning. More than ever before, brands have a responsibility, even an obligation, to enter into dialog with their audiences. The most skilful brands at this level are, moreover, those that do best and are often some of the most respected and most popular, for example the Apple brand.

Better mixture means better communication

Instead of the policy of push that has long characterized marketing, digital marketing leaves room for a mix of push and pull. The brand must, of course, be widely disseminated, but must also (re)position itself at the level of its consumers, be open, available, ready to listen and share its content, and go beyond simply addressing people directly (through its policy of push). All this can be done by means of pull, for example through the word of mouth of its ambassadors and fans (on the Internet and beyond).² Digital marketing thus allows both push and pull to be fully used so that the brand can express itself and encourage feedback and dialog.

The idea of feedback is also central for measuring effectiveness, since it allows the concept of “response” to a marketing stimulus to be introduced. Indeed, we could represent the effectiveness of a marketing campaign simply by its capacity to achieve the goals that have been set. We develop this topic in more detail below.

The effectiveness of digital marketing

The issue of return on investment (ROI)

Effectiveness refers to the ability of a person, group or system to achieve its goals and objectives, or those that have been set for it. Being effective means producing the expected results and achieving the agreed objectives in a timely manner. Objectives can be defined in terms of quantity, quality, timeliness, costs, profitability, and so on. The concept of effectiveness is widely used in economics and management. Effectiveness should not be confused with efficiency, which characterizes the capacity to achieve objectives at the cost of an optimal consumption of resources – personnel, materials, finance. The term “effectiveness” is often associated with the concept of return on investment.

As marketing is an aspect of management science, it is not surprising to find the notion of effectiveness at the heart of the marketing process. “Marketing effectiveness” or ROMI (return on marketing investment) is one of the central concerns of marketing departments. The economic crisis of recent years has only amplified the phenomenon. The recent Ad Age CMO Strategy/Forrester CMO Group Survey, conducted among marketing departments of large US companies,³ showed that, in 2011, chief marketing officers (CMOs) prioritized the maximization of return on marketing investments and not just the efficiency of these investments (we return to this topic later). In addition, marketing activities that are too expensive or too difficult to measure are quite simply dropped. These same US marketing managers made social media and digital marketing their number two priority for 2011.

In France, and in Europe more generally, the same priorities apply. As of November 2008, the effectiveness of marketing actions was the leading priority for CMOs. Our recent conversations with major industry associations confirm this trend. The same is true at a European level, as evidenced by the digital initiatives of advertisers through the World Federation of Advertisers (WFA) and digital industry experts through the Interactive Advertising Bureau (IAB) Europe.

Structural needs: necessary structural changes

In the case of France, the UDA e-marketing barometer is instructive, since it shows that even if the level of expertise of French advertisers in terms of knowledge and use of digital media is progressing, only 45% of them (compared to 40% in 2010) believe they have a good or very good knowledge of the tools available.

While these advertisers applaud digital marketing for its low cost, its relative simplicity of implementation, and its greater efficiency, they consider that the absence of a dedicated team in their organization (55% in 2011, 25% in 2010) and the lack of expertise and information about its effectiveness (44% in 2011, 45% in 2010) are the main obstacles to its development. In the space of a year, while investments have continued to grow and the lack of specialists and dedicated teams has become increasingly noticeable, the expertise in terms of efficiency has not improved.

If things do not move forward on this last point, the whole profession and digital marketing will suffer as a result, and its development will be that much slower. However, according to the sector’s professionals (see the Ad Age CMO Strategy/Forrester survey cited above), one only has to measure the effectiveness of digital marketing to see that is inevitable and even central to the marketing processes. So what is it in reality?

How effective is digital marketing? Can its effectiveness be measured? Do brands and marketing departments feel they have sufficient expertise on the subject? We shall see below that it is in regard to these points that much progress still remains to be made.

What does it mean to measure effectiv...

Table of contents

• Cover
• Title
• Copyright
• Contents
• List of figures
• List of tables
• Preface
• Acknowledgments
• Part 1 Devising a measure of effectiveness applicable to digital marketing
• Part 2 From the design to the implementation of a digital marketing effectiveness measure
• Part 3 Digital marketing in the service of brand and business development
• Index