Modern Digital Advertising! Imagine a scene; where you’re gathered in a boardroom listening to an agency representative confidently present your quarterly marketing performance. They’ve crunched the numbers, analyzed the data, and pointed out positive trends. The jubilant presentation, however, seems to be at odds with your latest financial reports, which reflect an all-time quarterly low in earnings. A sense of disconnect hangs heavy in the air.
Modern Digital Advertising: Does this image resonate with you?
This dilemma is no stranger to many marketers. Amid such conundrums, it’s helpful to gain insights from industry expert Chris Fraser, a digital advertising specialist from the Melbourne-based agency, Intentional?
Challenges and Insights from the Measuring Marketing Conundrum
Access to vital industry topics, like the role of the marketing efficiency ratio (MER) and the emergence of creatives in modern digital advertising, is crucial. Not conversant with MER? It’s computed by dividing your total revenue by your total ad spending. As per Fraser, a holistic view of performance is best gained from this metric.
Should you trust the ad platform data solely? Fraser advises, “Without a shared MER view, it can be burdensome to gauge overall progress.”
This perspective originates from Intentional’s method of customizing their dashboards that calculate MER using Funnel, synced with Shopify and ad account data. This distinctive strategy of adopting MER over marketing mix modeling (MMM) or attribution models showcases the constant quest to find the “magic bullet,” the uninterrupted source of truth. Fraser, however, believes that this so-called magic bullet lies within your raw data.
What Does the Future Hold for Marketers and Their Clients?
But, who benefits the most from MER? According to Fraser, it would be marketers who value their data and perceive it with cautious optimism.
With a resolute belief in transparency and honesty, Fraser values accountable conversations with clients. In Fraser’s experience, the ideal balance for investment is roughly 20% in brand and 80% in conversion initiatives. However, achieving this balance in digital marketing demands recognition of the long-term branding and short-term conversion growth objectives.
A New Frontier in Modern Digital Advertising
The modern landscape of modern digital advertising paints a picture of a “performance plateau.” With stricter privacy regulations altering marketing dynamics, marketers can no longer rely on the “spend more, earn more” model. Instead, they need to consider innovative online spending habits and incentives to appeal to increasingly discerning customers.
This reshaping of the marketing industry highlighted a snag in the adequacy of MER. The metric’s simplicity allows for easy short-term result depiction, but its struggle lies in conveying long-term outcomes.
A Creative Solution for an Ongoing Challenge
Innovative creative digital solutions emerge to bridge the gap left by unreliable measurement models. Unlike the past, where marketers relied on pixel tracking for niche targeting, creatives are now the keys to marketing success. Whether telling a specific brand story or appealing to a particular demographic, creative-led targeting demonstrates how marketers can still connect with their audiences in meaningful ways.
On the Horizon: A New Marketing Balance
However, that is not to say that marketers should abandon targeting altogether. Fraser’s overarching point emphasizes the necessity of striking a careful balance between hitting short-term goals and sustaining long-term growth. The ideal scenario, according to the “Messy Middle” study by Google, showcases a nonlinear buying process where customers can make purchasing decisions over time by using modern digital advertising methods.
The Client-Agency Relationship Conundrum
The push-pull dynamics between clients and agencies are not to be neglected too. Agencies are now expected to be increasingly proficient in comprehending the client’s business industry and to propose strategies that significantly contribute to the client’s margins. Adequate attention and focus should also be given to fostering healthy, transparent, and trusting relationships between agencies and clients.
An Ethical Stance
Open and honest communication, valid metrics, and ethical practices should be the pillars of any successful agency-client relationship. The perception that only continuous upward growth is feasible, is flawed. Times of struggle in marketing are inevitable, true maturity lies in facing these challenges head-on without veering from transparency and honesty.
So, the next time you’re seated in a boardroom, being shown seemingly too-good-to-be-true results, dare to question and scrutinize the processes behind them. After all, the road to marketing success is paved with trust, honesty, and a good dose of healthy skepticism.
No single solution fits all marketing challenges. Chris emphasizes that while adopting Intentional’s approach or relying on tools like North Beam and Triple Whale doesn’t guarantee success, it provides different models, each with its advantages and warning lights.
Additionally, while many businesses would ideally prefer to leverage advanced techniques like MMM to optimize their marketing investments, not all brands can achieve this. Often, smaller brands’ investment in modern digital advertising might be considerably tilted towards maximizing MER. As a result, they may overlook the potential for long-term brand-building opportunities, thus falling victim to the “performance plateau.”
Chris suggests that MER is best used as a guidepost rather than a definitive solution. Starting a discussion that focuses on guiding clients through the distinct levels of MER growth sparks a chance to evolve how clients invest in modern digital advertising. Although Intentional acknowledges that MER is not a flawless model, it believes it to be a more responsible and truthful model than blindly trusting attribution platforms.
