Hey there, fellow marketing enthusiasts! Let's dive into the wild and wacky world of digital marketing measurement—a realm that's as misunderstood as the plot of a Quentin Tarantino movie.
This topic was sparked by a brilliant LinkedIn post from Dean Leyland of LeoVegas. Fun fact: Dean and I were colleagues at Tote Betting in Wigan back in the early 2000s. Working with him was an absolute blast, and I hold him in the highest regard.
The ROI Obsession: Chasing the Unicorn
In today's marketing landscape, digital spend is gobbling up more of our budgets than ever before. Naturally, our bosses and stakeholders are chanting the mantra of ROI—Return on Investment—for every campaign we launch. But here's the kicker: measuring ROI in digital marketing isn't as straightforward as counting likes or retweets. It's a complex beast, and here's why.
Key Metrics in Digital Marketing Measurement
Understanding digital marketing success comes down to several key performance indicators (KPIs). Here are some of the most commonly used acronyms and what they mean:
- ROI (Return on Investment): The classic metric that calculates the profitability of a campaign by comparing revenue generated to the costs involved.
- ROAS (Return on Ad Spend): A more specific measure of advertising effectiveness, calculated by dividing revenue generated from ads by the ad spend itself.
- CPA (Cost Per Acquisition): The cost associated with acquiring a new customer or conversion.
- LTV (Lifetime Value): The projected revenue a customer will generate over their lifetime with your brand.
At Digital Fuel, we strive to report as best we can, and most of the time, we're bang on the nail by building creative BI (Business Intelligence) reports. However, it's important for clients to sometimes take a step back and look at the bigger picture. Digital marketing measurement gets better over time, especially when campaigns remain consistent and aligned with a clear strategy.
Both agency and client need to be in the boat rowing together to cross the water, which at times will be choppy and at times still. Alignment and cooperation are the keys to navigating this dynamic landscape effectively.
The Digital Jungle: Fragmented Channels and Data Silos
Imagine trying to piece together a puzzle where each piece is from a different set. That's what it's like to measure digital marketing performance across various platforms. Each channel—be it affiliates, social media, email, or PPC—operates in its own universe, often hoarding data like it's the last slice of pizza at a party. This fragmentation makes it a Herculean task to get a unified view of performance.
According to the Interactive Advertising Bureau (IAB), data silos are a significant hurdle in marketing measurement. When data is stuck in silos, it fogs your vision for crucial insights, making it difficult to optimize your marketing campaigns.
Cookies Crumbling: Privacy Regulations Tighten the Reins
Remember the good old days when cookies were just delicious treats? In the digital realm, cookies have been the backbone of tracking user behavior. However, with evolving privacy regulations and cookie consent rules, our tracking capabilities are taking a hit. Google's recent decision to forego eliminating third-party cookies in Chrome, opting instead to prompt users to opt in or out, adds another layer of complexity.
The App vs. Web Showdown
As if things weren't complicated enough, there's the growing divide between app and web platforms. Users seamlessly switch between mobile apps and web browsers, but tracking their journey across these platforms is like trying to follow a cat on a midnight adventure—nearly impossible. This disjointed tracking further muddies our performance metrics.
Measuring Affiliate Marketing: The Power of Postbacks
Affiliate marketing adds another layer of measurement complexity, but it's also one of the most cost-effective ways to drive performance. Unlike traditional paid media, where you pay upfront, affiliates are typically paid on a cost-per-acquisition (CPA) basis, making accurate tracking essential.
Enter postbacks—one of the best tools for measuring affiliate marketing performance. A postback (server-to-server tracking) ensures accurate tracking by directly sending conversion data from the advertiser’s system to the affiliate platform. This eliminates reliance on cookies (which, as we mentioned, are on their last legs) and improves tracking accuracy across different devices.
Postback's aren't just for affiliate programs—they can be used across multiple marketing channels and platforms online. Many performance marketing campaigns, including paid search, social media, and influencer marketing, benefit from postback tracking as it provides a more reliable attribution model.
Why Postbacks Rock
- More Accurate Tracking: Unlike pixels that rely on browser cookies, postbacks track conversions even when users switch devices.
- Real-Time Data: Postbacks allow near-instant updates on conversions, giving affiliates and advertisers more control over optimisations.
- Better Fraud Prevention: With direct server-to-server tracking, fraudulent conversions are easier to detect and prevent.
For brands running affiliate marketing campaigns, implementing a strong postback setup can lead to better attribution and optimised partnerships.
Solutions for In-App Media Buying: Tracking Conversions
When it comes to in-app media buying, tracking solutions become even more critical. With apps operating in a "walled garden" environment, traditional web-based tracking methods don’t cut it. That’s where mobile measurement partners (MMPs) like AppsFlyer, Adjust, Branch, and Singular come into play.
How MMPs Help with In-App Conversion Tracking
- Attribution Across Channels: MMPs assign credit to the right traffic source, ensuring advertisers know which campaigns are working.
- Deep Linking: Helps drive users to the right in-app experience post-click, improving conversion rates.
- Fraud Prevention: Protects campaigns from mobile ad fraud, which is a huge issue in performance marketing.
- Cross-Device Measurement: Tracks users moving between mobile web and in-app environments, improving accuracy.
For brands investing heavily in mobile marketing, using an MMP is a no-brainer. Without one, you're essentially flying blind in a stormy digital landscape.
The Myth of the One-Size-Fits-All Solution
In this chaotic landscape, it's tempting to search for a magical tool or method that provides a universal performance number—a single ROI to rule them all. Spoiler alert: it doesn't exist. Each measurement method has its quirks and flaws. The key is to find an approach that aligns with your specific channels and objectives. Embrace the imperfections, and you'll maintain your sanity. Attempting to make every platform align perfectly will only lead to frustration for you and your team.
Final Thoughts: Keep It Fun and Keep Learning
Digital marketing measurement is a rollercoaster ride—filled with twists, turns, and the occasional scream. But it's also an exciting journey that keeps us on our toes. By embracing the imperfections, building flexible frameworks, and staying adaptable, we can navigate this complex landscape with a smile. Remember, in the words of a wise marketer: "Embrace the chaos, and let creativity be your compass."
So, fellow marketers, let's raise a glass to the beautifully messy world of digital marketing measurement. Here's to navigating the chaos with wit, wisdom, and a whole lot of fun!