Marketing Measurement for Enhanced Success and Value Creation

What is Marketing Measurement?

Marketing measurement encompasses the methods, tools, and processes used to evaluate the effectiveness of marketing activities. It's about quantifying the impact of your marketing efforts. Often, the focus is on the impact of various marketing channels and campaigns due to data availability. However, marketing measurement also includes quantifying impact at a granular level, such as evaluating the effectiveness of individual ad placements, as seen in many attribution models.

Why is Marketing Measurement Important?

Anyone investing in marketing should know the return on their investment. Only by understanding the impact of your marketing activities in detail can you optimize effectively and get the most out of your campaigns. Marketing measurement is a crucial task that every company should take seriously – the higher the advertising spend, the more critical this task becomes.

The primary goal of marketing measurement is clear: increase the efficiency of advertising spending and get the maximum return from every euro invested.

Key Components of Marketing Measurement

Modern and effective marketing measurement in 2024 relies on the combination of three methods that complement each other:

Marketing Mix Modeling (MMM): Quantifies the relationships between marketing activities and key business KPIs (such as sales, revenue, web visits, etc.), even beyond marketing activities. This provides an ideal basis for optimizing marketing activities and valuable support for internal communication with stakeholders beyond marketing.

Experimentation: Allows you to examine cause-and-effect relationships that cannot be clarified by marketing mix modeling due to the data situation. For example, when newly emerging marketing channels have never been used in the past or only at a very low level.

Always-on Measurement and Attribution: With very granular data, the statements from marketing mix modeling can also be questioned and additional questions answered that marketing mix modeling cannot answer, such as, "Which display creative has a better click-through rate?" "With which SEA creative do we generate more revenue?".

If you want to focus on one method first, you should start with marketing mix modeling, as it is the connecting element between the three methods and offers the best potential to make your marketing activities more efficient directly through the use of a method. Depending on the business model and needs, you can then use the other two methods in addition to leverage further potential.

Challenges in Marketing Measurement

The basis for value-creating marketing measurement is data that arises around marketing activities. Data that comes from different sources, must be merged from different systems and must be continuously updated. The ever more diverse mix of marketing activities means that the number of sources continues to increase. Nevertheless, stricter data protection regulations must be observed and alternatives found to understand the surfing behavior of users in the future despite cookie regulation.

It is important to ensure that the resources spent on marketing measurement are in a healthy relationship to the total marketing investment. Every euro you invest in measuring and analyzing marketing activities must also pay off in the form of increased marketing efficiency.

The Future of Marketing Measurement

Modern and particularly value-creating marketing measurement will be heavily influenced by technical innovation in order to be able to use it more cost-effectively and effectively. The market of software-as-a-service providers will consolidate. At the same time, new players will keep emerging who will try to stand out with hype topics and set themselves apart from the competition. As an advertiser, I can best prepare for this and benefit from market developments if I collect and store the data surrounding my own marketing activities as granularly as possible and over longer periods of time.

Conclusion

Marketing measurement is an important task within marketing to ensure high efficiency of advertising expenditure. The higher the annual advertising expenditure, the more important it is to establish marketing measurement processes in the company. In general, it is important to ensure that the use of resources for marketing measurement is in a healthy relationship to advertising expenditure. The best starting point for value-creating and effective marketing measurement is the marketing mix modeling method.