Download Budget allocation in the world of multichannel marketing

Adobe Digital Marketing Suite Solution Brief
Budget allocation in the world of
multichannel marketing
How to optimize ROI
The attribution challenge
Should marketers allocate more budget toward social and mobile channels, or less? Are mobile store
locators or email marketing campaigns ultimately propelling customers toward conversions on the
e-commerce website or in stores? All marketers, regardless of industry, are asking themselves these
questions, and often coming up short.
Today, marketers are striving to move beyond the ’last click‘ attribution model that potentially short
changes a variety of channel interactions in stores, social, email marketing, and other avenues, and gives
faulty conversion credit to the very last click on an e-commerce website. Few marketers know how to
advance beyond click-based attribution and therefore are not finding actionable answers that help them
advance their multichannel marketing efforts.
Marketing
Attribution is
a model for
evaluating the
performance
of all channels
(convertors
and nonconvertors)
Marketers need accurate channel valuation to focus spend on channels that perform best throughout the
entire path to conversion
The need for accountability despite increasing complexity
With higher expectations for digital marketing returns, marketing leaders are struggling to capture and
communicate campaign ROI. Although every business function must explicitly demonstrate worth and
accountability, the proliferation of online and offline channels has left marketers wondering where to
allocate budgets to optimize returns. At issue: the lack of visibility into the mix of events leading up to
conversion.
Marketers today need—and demand—better solutions for marketing attribution. In the November 2011
Forrester Research report What Does the Web Analytics Industry Want to Be When It Grows Up? a full
46% of respondents answered ‘Marketing Attribution’ to the question: ‘Which topics represent the three
greatest challenges that you seek to resolve with your web analytics solution?’
This finding is backed up by Adobe research. In early 2012, CMO.com readers, who include marketing
executives and managers in businesses across industries worldwide, were surveyed about measuring and
tracking the ROI on their digital marketing campaigns. The results were telling, and highlighted what
marketers feel is their inability to measure the overall efficiency and effectiveness of their digital
marketing efforts.
Through the CMO.com survey, Adobe discovered that fewer than 20% of marketing respondents have
full confidence in what should be fundamental abilities, including measuring overall campaign
effectiveness, how to allocate budget with ROI in mind, and communicating performance up
to C-Level executives. In large part, it appears the lack of confidence results from a perception that
there is simply too much data and too many channels, making it difficult to capture, measure, and
attribute conversions appropriately.
At the same time, it is clear the need to communicate the value of digital marketing campaigns is
greater than ever. Survey responses from CMO.com readers showed that more than 70% of them
communicate with executives about performance metrics associated with their marketing and
advertising campaigns at least once a month. Managers typically rely on dashboards to address
executive demand for frequent reporting. In summing up the experience of many marketing
managers today, one marketing director at a large technology company explained in his survey
response that he meets weekly with the company’s sales director to evaluate how his marketing
initiatives impact leads and discuss where those leads are in the sales cycle. Still, many marketers are
looking for more granular methods of analyzing what is occurring in the marketing and sales funnel.
Credit where credit is due
Today, more advanced online and offline attribution solutions are available that can help marketers
accurately credit the contribution of various marketing and communications channels to conversions
and sales, regardless of the customer’s journey toward a purchase or other conversion event. These
solutions are helping marketers allocate online and offline budgets wisely to maximize ROI.
Attribution seeks to provide answers to which marketing efforts had what share of influence on
the conversion. Adobe® Insight, a cornerstone of Adobe Digital Marketing Suite, can integrate
event-level log data from practically any data source. Because of this, Adobe Insight is frequently
used to combine not only web clickstream data (from Adobe SiteCatalyst® or other commercial
or proprietary web analytics technologies), but also event-level data from store sales (POS)
systems and data from marketing vendors like ad servers or email marketing service providers.
Conversions do not have to be e-commerce cart checkouts. Attribution can be made to multiple
conversion points, both online and offline: retail store counter purchases, hotel check-ins, airport
kiosk events, rental car check-outs, B2B lead form submissions, and webinar attendance. If it is an
event, then attribution can be configured and included in the mix for analysis. This is important
because conversion for most types of businesses—retail and otherwise—occurs in both online
and offline channels.
Multidimensional analysis for more precise attribution
With Adobe Insight, it is possible to correlate precise events within a single view of each customer
and understand how each display ad view, email send, and direct mail piece—in short, every
addressable marketing touch point—influences conversions. Individual events can be associated
and grouped by customer, then organized by experience, such as web visits, store purchases, call
center sessions, and more. All events are ordered by time, presenting fast, multi-dimensional
analysis on any level of the data. Armed with this information, marketers can begin to build more
advanced attribution models and tailor them specifically to the needs of the business, whether the
company is in travel, retail, financial services, or other areas.
Many marketers start by experimenting with a few pre-configured models and then tailor
them based on the specific business requirements. Examples include:
• First and Last Touch—The first marketing touch receives the full credit for the conversion in
one model; the last marketing touch garners the full credit in the other model.
• Even (Linear)—Every marketing touch within a defined period of time receives an equal
share of credit for the conversion.
• Starter/Player/Closer—The Starter (initiating) touch receives a set percent of credit for the
conversion, the Closer (last) touch receives a set percent of credit for the conversion, and the
remaining Player touches each receive an equal share of the remaining credit for the conversion.
Adobe Digital Marketing Suite Solution Brief
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• Latency Score—Every marketing touch is scored with a numeric value reflecting how many
days it fell prior to the next conversion.
• Pathing—Advanced visualizations in Adobe Insight help the marketer understand both the
direct and indirect paths among customers’ experiences with various touch points.
• Stacking—Pinpoints how many interactions and channels precede a purchase.
These examples clearly show how marketers can easily go from ‘click only’ attribution to
impression-level ‘touches’ such as email sends, email opens, lead submission forms, social
channel interactions, and more. The results include rich intelligence into how customers are
interacting with a brand, both online and offline, and a better understanding of where to
spend marketing dollars to maximize effectiveness and ROI.
Attribution modeling: a process versus an event
One major retailer is using Adobe Insight to test several attribution models. The company is
measuring in-store sales and tracking interactions down to the individual user through its loyalty
program. After testing several attribution models, the retailer can gauge success and better
allocate budgets using a combination of Last Click, Linear, and Stacking attribution models.
The company has learned how to successfully create and follow an analytics roadmap. Marketers
at the company have found that defining the questions to ask cannot be accomplished in a day
or a week. Instead, it is an ongoing process that requires input from experts and analysts and
a keen understanding of the data inputs. The company’s advice? Start analyzing data as soon
as possible. Continuously validate the data and reference back to the analytics roadmap and
selected attribution models for constant refinements.
Recommendations
Whether the aim is to attract new customers, retain customers, maximize mobile conversions,
increase social engagement, boost average order value, or all of the above, marketers today can no
longer rely on guesstimates. According to Adobe’s recent survey on CMO.com, the complexity
of channels and the huge volume of data created and captured are the primary culprits hindering
data acquisition and reporting. Using new multichannel attribution and analysis tools, marketers
can gain invaluable insights based on hard data that can assist them in more intelligently allocating
funds toward both online and offline channels, and communicating the resulting strategies and
results across their organizations. Here are some simple steps you can follow to improve your
attribution analyses and achieve better returns on your marketing investments.
For more information
www.adobe.com/products/
insight.html
1. Start collecting data and have a realistic, phased strategy
2. Start measuring and explore for insights without knowing the answer
3. Be prepared to make mistakes, but learn from them—keep iterating
4. Continue to evolve by adding new channels and models
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