According to Marketing ROI in the Era of Big Data released by Colombia Business School’s Center on Global Brand Leadership, marketers are adopting new digital tools but struggle to measure marketing ROI due to channel-specific metrics. Columbia Business School and the New York American Marketing Association (NYAMA) together surveyed 253 corporate decision makers from large companies with global annual revenues in excess of $50 million; 42 percent of companies were B2B, 28 percent were B2C, and 30 percent were a combination of the two.
The study aimed to gather information and insight about the changing practices of corporate marketers, including marketing measurement and ROI as well as the integration of digital and traditional marketing. Data shows new digital media are experiencing a rapid adoption rate—78 percent of B2B companies, for instance, report using social network marketing—but that marketing measurement is not keeping with the same pace. “In particular,” the study claims, “measurement of digital marketing with financial metrics (such as market share, revenue, profit, or lifetime customer value) is lagging. Only 14 percent of those companies using social network marketing are tying it to financial metrics.”
One reason for this, according to the study, has to do with “channel-specific metrics” (i.e., “retweets” measuring customer engagement on Twitter and “likes” and “shares” measuring the same on Facebook) which ultimately make it difficult to measure one digital marketing effort against another. Such channel-specific metrics, by extension, prove challenging when it comes to integrating digital and traditional marketing into a single measurement model, as reported by 77 percent of companies surveyed.
In order to effectively link digital marketing efforts to measurements of marketing ROI, the survey recommends “setting clear business objectives for any digital marketing effort” and “developing models that link channel-specific digital metrics to universal metrics, including KPIs.” By effectively harnessing the capabilities of new digital tools, corporations may better position themselves to stay one step ahead of the evolving technology.