Improving marketing accountability…and then ROI

Improving marketing accountability…and then ROI
SHARE
THIS



A media agency point of view.

Return on investment (ROI) is a very simple formula designed by accountants to measure the bottom-line; the result of some action, relative to the effort put in.  If the output is greater than the input, then the ROI is positive and everyone is happy.

The trick with any formula is the variables you put into it.  If the action is something simple, like buying and selling shares, then the variables are simple – buy price and sell price.  Buy low, sell high and you get a positive ROI.  

But if the action is more intricate like marketing and media investment, determining both the correct output to measure against, and the inputs that impact on that output, can be much more difficult, and much more interesting.

There’s a lot of focus on ROI in our industry and many client agency relationships live and die by it.  However, the stages required to get to the bottom-line are so intricate that we prefer to use Marketing Accountability; a much clearer way to measure.  Whilst more complex than traditional ROI measurement, it provides a more realistic view of the impact of a campaign and should be applied across the industry to offer clients a better idea of how their campaigns are performing.

What is Marketing Accountability?

The first stage is to define and unpack the term Marketing Accountability –

Marketing challenges us to “identify, anticipate and satisfy customer requirements profitably”. The two key terms here, are –

1.       “identify” – what are our goals/objectives? We need to identify what Marketing is directly responsible for. This may not always be ‘the bottom line’.

2.       “profitably” – by definition, if we’ve identified the correct objectives, and we can deliver them more efficiently, then the flow on effect to ‘the bottom line’ must be positive.

“Accountability” puts the onus back on us, the practitioners, to be responsible and honourable, to deliver what we say we’re going to deliver and to do “the right thing”. The best way to be confident in what can be delivered is to have systems and processes that provide accurate forecasts under various scenarios.

What do we need to calculate Marketing Accountability?

The second step towards Marketing Accountability is to develop the systems and processes that can help to understand what causes the variability in our desired result.  To do this, we need three things.

1.       The right people. People that have a burning desire to use analytical and marketing strategy skills to truly understand what drives a result.

2.       The right tools & processes. Marketing Accountability is not a one-size fits-all. Multiple tools and processes are required to provide multiple solutions to the multiple objectives set by our clients.

3.       The right technology. Both the hardware and software technologies required to deliver true Marketing Accountability solutions are constantly evolving. Suppliers need to be in a continuous state of research and development.

How do we implement it?

We need to take pride in being able to say that we understand Marketing Accountability. We must spend significant amounts of time and effort with our clients ‘identifying’ the right objectives, and then setting up solutions that deliver ‘the right thing’. To achieve this, the following investments are critical:

1.       The right people. Data analysts, statisticians, marketing strategists

2.       An existing suite of tools that can be applied depending on the client’s requirements. Continued investment in new approaches to marketing accountability, constantly researching and developing new techniques.

3.       Powerful technologies to manage ‘big data’ with the ability to cut, filter and segment media data at many levels of detail to determine effectiveness.

Marketing Accountability is not easy and is an ongoing challenge in our industry. It takes a lot of effort, especially to get started.  But the effort rarely proves to be wasted. 

Simon Ryan, managing director, Carat Melbourne

Please login with linkedin to comment

Latest News

person using mobile application on smartphone, abstract close up of hands
  • Technology

Mobile Advertising Company Kargo Announces New Hires Following H1 Growth In APAC

Kargo has today announced several major growth milestones across the APAC region for the first half of 2021, more than doubling H1 revenue year-over-year with 115 per cent growth. Kargo also ran 41 per cent more campaigns in the region than in H1 2020 and the average campaign size increased by 32 per cent over […]

Hootsuite Acquires Conversational AI Platform Heyday
  • Technology

Hootsuite Acquires Conversational AI Platform Heyday

Hootsuite has today announced its acquisition of Heyday, a Montreal-based conversational AI platform that enables brands to deliver personalised customer experiences through 1:1 messaging conversations. Commerce is rapidly moving onto social and messaging platforms. Hootsuite, a pioneer in the social media management category, has the largest customer base in the industry and with this acquisition […]

Officeworks Partners With Canva
  • Campaigns

Officeworks Partners With Canva

B&T's a huge fan of the Officeworks shopping experience, but just throwing it out there about possible $1 hot dogs?

PRIA Announces National Conference
  • Marketing

PRIA Announces National Conference

Public Relations Institute announces national conference. Sadly, Roxy won't be speaking on unwanted doorstep excreta.

EATIVITY Founder Moira Geddes Becomes First-Ever Micro-Publisher To Take Part In IAB Mentorship Program
  • Technology

EATIVITY Founder Moira Geddes Becomes First-Ever Micro-Publisher To Take Part In IAB Mentorship Program

Moira Geddes, founder and director of independent food publication EATIVITY has been handpicked by IAB Australia to become the first ever micro-publisher to take part in its Mentorship Program, highlighting the important role that specialised custom digital sites play within the country’s media landscape. EATIVITY aims to keep consumers in the know and help small […]

Hivestack Appointments Ichiro Jinnai As President, Japan
  • Advertising

Hivestack Appointments Ichiro Jinnai As President, Japan

Hivestack, the global ad tech leader in programmatic digital out of home (DOOH) advertising, today announced the appointment of Ichiro Jinnai as president, Hivestack Japan. Jinnai will be responsible for driving the regional strategy, direction and expansion of the Hivestack platform in Japan. “I am beyond thrilled to welcome Ichiro Jinnai to the Hivestack family,” […]

LENS Technology & Analytics Appoints Nikhil Elayat As Business Director
  • Advertising

LENS Technology & Analytics Appoints Nikhil Elayat As Business Director

Audience measurement platform LENS Technology & Analytics has appointed Nikhil Elayat to Business Director to fast-track growth opportunities across Australia and New Zealand. Elayat (pictured) joins from New Zealand’s largest independent advertising agency, Stanley Street, where he was head of advertising technology. He played a pivotal role in building adtech functions within the performance team […]

Burnet Institute Launches How Science Matters Podcast
  • Media

Burnet Institute Launches How Science Matters Podcast

Australian medical research institute, The Burnet Institute has launched, How Science Matters podcast. The informative podcast will be co-hosted by former ABC Radio journalist Tracy Parish and Burnet institute director and CEO Professor Brendan Crabb AC. Crabb is also a microbiologist, malaria researcher and will share his knowledge on contagious diseases. How Science Matters was […]

D&AD & Google Launch Shift In Sydney
  • Advertising
  • Media

D&AD & Google Launch Shift In Sydney

This extols "turning your passion into your profession". Unless your passions are dancing dachshunds or roller limbo.