Is your marketing effectiveness strategy set up to succeed in 2024? This is an important question – whatever sector you work in and wherever in the world you operate – as marketers gear up for a year that is set to be dominated by some major events. A Presidential election in the US, the Summer Olympic and Paralympic Games in France, and the end of third-party cookies in Google Chrome – to name just a few that spring to mind – will all happen amid continued geopolitical and economic uncertainty.
Against this backdrop, marketers must ensure the investments they make – whether that’s a new media campaign, product launch, or loyalty program – contribute to business growth as effectively as possible. To help you do this, WARC and Gain Theory have created a new framework that guides you towards developing advanced marketing effectiveness capabilities.
The framework, which consists of four building blocks and two growth accelerators, is the basis of Accelerating growth with marketing effectiveness: A playbook – a new white paper from WARC and Gain Theory. We illustrate it as follows:
Below is an overview of the framework, which is based on a survey of 367 marketers, in-depth interviews with five senior marketers, and expert analysis from WARC and Gain Theory, as well as some practical recommendations to get you started. Click here to download the full report.
Building block 1: Defining success
First and foremost, take a step back from the budget spreadsheet or latest creative pitch and ask yourself the following:
- Are your marketing goals aligned with the business goals?
- Is the role that marketing plays in reaching those goals agreed upon with other key stakeholders?
- Are there clear KPIs against which you can measure progress towards these goals?
Answering yes to all three of these questions is key to marketing effectiveness success. But 40% of the marketing practitioners we surveyed did not agree that their company had clear directives to evaluate and optimize marketing investments.
“40% of marketing practitioners did not agree that their company had clear directives to evaluate and optimize marketing investments”
If you are one of this significant minority then you need to take action. As Justin Bell, Head of Marketing Measurement at UK-based bank NatWest Group, explains: “[Best-in-class marketing measurement] is a pyramid that flows from what the business objectives are. Business objectives need to be very clear for marketing to align and support them. Marketing objectives then naturally flow from the business objectives. All your metrics should ladder up to these objectives. There has to be a red thread that clearly connects a metric to a business objective.”
Building block 2: Data excellence
Having the best possible data is critical to good decision-making, but there are well-known challenges to getting hold of it: walled gardens, ongoing global regulation, internal siloes, and increased costs. As a result, perhaps it’s no surprise that only half of marketing practitioners we surveyed are satisfied with the raw data at their disposal.
Nevertheless, our survey found that there are more deep-rooted issues. It is concerning, for example, that 40% disagreed that the majority of their companies’ marketing investment decisions is supported by data or insights. It’s not just a question of a lack of data access: a further 41% did not agree they were personally incentivized or evaluated to use data in decision-making.
“40% disagreed that the majority of their companies’ marketing investment decisions is supported by data or insights”
These findings suggest some companies have fundamental questions to answer about the role that data plays in their overall decision-making processes. As Raj Kumar, CMO at HSBC Innovation Banking, says: “The [biggest data] challenge is being able to articulate the kind of data strategy that would be needed to enable the growth you want to achieve. Everything else is secondary.”
Building block 3: Advanced measurement
Measurement is what transforms the raw material of data into usable insights that demonstrate the effectiveness of marketing activities. When it’s done well, it can be transformative. Analysis of the survey revealed that companies that rated their analytic performance as ‘good’ have almost 50% probability of achieving revenue growth in excess of 5%. In contrast, those who rated their analytic performance as ‘poor’ have just a 5% probability of achieving revenue growth in excess of 5%.
“Companies that rated their analytic performance as ‘good’ have almost 50% probability of achieving revenue growth in excess of 5%”
How do you achieve ‘good’ analytics? We have identified five key drivers: quality data, granular data, timely insights, detailed tactical measurement, and the ability to measure the effectiveness of creative ideas and their execution.
But the survey also revealed that best-in-class measurement requires marketing departments to overcome a disconnect internally between C-level marketers and marketing practitioners: while more than nine in 10 C-level marketers say they see the value generated by marketing measurement programs, fewer than six in 10 marketing practitioners agree.
Building block 4: The power of foresight
Foresight – the ability to plan proactively for multiple future scenarios by converting uncertainty into measurable risk – is the hallmark of the most advanced marketing effectiveness strategies. As Linda Bethea, Head of Marketing at Danone North America, says: “We’re trying hard to move from data to insights to foresight because we can’t wait for an annual marketing mix analysis to make decisions, particularly in new categories that are evolving extremely rapidly.”
Yet foresight is often not in the purview of marketing, or if it is, it is misunderstood. Only 41% of marketing practitioners agree that key foresight methodologies, such as scenario planning and war-gaming, form part of their company’s future planning process.
“Only 41% of marketing practitioners agreed that key foresight methodologies form part of their company’s future planning process”
In the current environment, it has never been more important to use these techniques. Foresight ensures you consider a range of credible outcomes and assign a probability to each one. Crucially, it means you avoid a reliance on single-point estimates of growth and build in clear signposts that indicate pivot points.
Baking foresight into your planning can help to mitigate the effects of uncertainty – whether that be macroeconomic, geopolitical, technological, or climate-related – that are impacting all businesses and the behavior of their customers by turning them into measurable risk. It also increases the likelihood of senior decision makers, such as CFOs, trusting the insights and recommendations they are presented with.
Read more: How mastering the power of foresight helps marketers to plan more effectively.
Growth accelerator 1: Strong foundations
Foundations refer to the strategies, capabilities, and processes that underpin each of the four building blocks. Along with the second growth accelerator, culture, focusing on these two areas enable companies to really excel in marketing effectiveness. Here are four recommendations from the white paper that will help you to create strong foundations:
- Develop a clear hierarchy of metrics that demonstrates how an individual marketing campaign links to a business KPI (e.g. incremental like-for-like sales).
- Identify data needs, gaps, and blockages by conducting an audit around five key areas: breadth, depth, quality, granularity, and accessibility. Then, focus on collecting the right data, not all the data.
- Base your measurement program on five principles: a clear framework, speed of insight, a unified view over the short and long term, factor in risk, and continuous optimization.
- Understand what foresight means and where the expertise sits within your organization.
Growth accelerator 2: Strong culture
Culture refers to the values, beliefs, and behaviors that are required from the business and its employees. Here are four recommendations that will help you to develop a strong culture in each of the building blocks:
- Focus on getting buy-in from senior stakeholders and securing support from marketers at all levels of your organization for improvements to your effectiveness strategy.
- Ensure data is democratized and can be used by relevant teams. Individuals should be incentivized to use data and evaluated on how they go about this.
- Address the disconnect between the c-suite and marketing practitioners around the value of measurement programs through improved communication.
- Think carefully about the best way to integrate foresight into the marketing organization through clear communication, workstreams, and upskilling where necessary.
Consistently assess to improve
This overview provides a glimpse of what it takes to accelerate growth with best-in-class marketing effectiveness. To get the full picture, I encourage you to download the white paper and read in full.
One of the areas I haven’t covered in this article is the need to consistently assess every aspect of your marketing effectiveness program to learn what’s working, what’s not, and why. To help you do this, the white paper includes some key criteria, questions, and actions. Ultimately, it is only by creating a closed-loop system of testing, learning, and adapting that you can ensure you make better marketing investment decisions in 2024 and beyond.
Contact Gain Theory to discuss how you can implement this framework to improve your marketing effectiveness program.