A recent survey of 684 b-to-b marketers
revealed marketing budgets are cutting print dollars (45.3% are looking at print spending cuts) and boosting online dollars (48.5% are increasing online spending). Yes, in these difficult times, money is flowing to the online world. That's great! But it's not the whole story.
Upper management is tuning in to frugality. They are not longer looking for more wheelbarrows to bring in the stacks of cash piling up outside the front door. Instead, they are thinking about ROI.
When gasoline was 19 cents a gallon (yes, I am that old), it didn't matter whether you drove like a bat out of hell or a little old lady from Pasadena (cultural reference proving that I am that old). Now it does. People are watching -- like your boss. And her boss. They want to know that a dollar spent online will result in two dollars earned. How are they going to know? Metrics.
Your online budget is not getting cut, but it is getting scrutinized as never before. Well, not since the dot-bomb almost a decade ago. You may not hire more people. You have to choose your promotional indulgences carefully. You must prove the value of that viral, video-Twitter Flash animation expenditure.
How? With metrics.
Winning awards for creativity, humor and design no longer figure into whether you earn your bonus or deserve a raise. The number of people you can drive to your Web site is no longer the main criteria for promotional success. It's all about topline revenue.
So your marching orders are clear. First, figure out how to track advertising and marketing expenditures from click to sale (even if you are in a long-sales-cycle, considered-decision market). Second, figure out how to attribute revenue across your multiple touchpoints.
From the click to the persuasion process to the shopping cart (or lead capture system) to the sale, each individual customer's actions must be captured and tracked. We need to know if that banner ad, pay-per-click keyword, press release brought in good leads, not just more leads.
But the tough part is attribution. The person who clicked on that banner ad and entered her credit card number was not likely to have done so in a vacuum. It's much more plausible that she saw the newspaper ad, heard the spot on the radio, had previously visited your site based on a Google search, and had played with your silly widget on FaceBook. Your job is to allocate the sale against all of those expenditures. Otherwise, the only sure way to determine which of your marketing dollars is wasted is to stop one at a time and see which stoppage causes the biggest drop in sales. Great for data! Not great for that bonus.
Companies like Coremetrics and Omniture are incorporating multi-campaign attribution in their tools, so more of their clients are learning the ropes. Soon, there will be case studies and best practices. Until then, I turn to people like Jim Novo and his post on Marketing Attribution Models
Tough times call for tough measures. It's time to take measurement seriously.