Tying Marketing to Revenues: Top 5 Challenges
Soren | 26 May, 2010
eMarketer reports that Marketers are still having trouble tying marketing to Revenue. Because this is our job, we run directly into many of the reasons why this continues to be a challenge for Marketers and companies engaged in Online Marketing. Here are the Top Five Challenges we often have to overcome in making full-life cycle marketing optimization work:
1. Incomplete Tracking Systems: The good news is most companies are now tracking something related to their marketing. The bad news is that they are still very often tracking the wrong things or in the wrong way. Tracking systems need to show aggregate site performance and individual user behavior. Hint: most systems are not good at both. You can use more than one.
2. Tracking Ends on the Web Site: You need systems that let you feed sales/and revenue data back into the marketing program. The good news is that most existing systems can be tied together. You don’t necessarily need to invest in new systems, or expensive ones.
3. The “Bucket” Assumption: Banish the assumption that every sale should be credited to a single marketing source. People who believe that SEO, PPC, Display, Remarketing, Offline, PR, and nurturing programs work in isolation will make bad decisions. Marketers working on multiple pieces of the marketing pie need a holistic view, and some forms of marketing (*cough Display!*) demand it for proper evaluation.
4. One-Way Data Flow: Most installed systems that tie marketing to revenues have been purchased so that the C-Suite can generate marketing reports. They are missing the value of these systems. Data is *not* for reporting. Data is for *action*. You have to create feedback loops so that marketing campaigns can be optimized to improve results. Take baseball. Measuring a hitter’s swing let’s you evaluate good and bad hitters. Capitalizing on that data in the training process makes for a whole team that can swing for the fences.
5. Online is Different: Another challenge is to overcome internal assumptions about how marketing works. In the old days you “dropped” marketing pieces, typically infrequently, that largely had a fixed cost. You measured, if you could at all, on lift, and if not, on reach. If you liked the numbers, wash, rinse, repeat. Of course, the world has changed. Online Marketing does not have fixed costs, it is dynamic, and it requires constant optimization. Campaigns can be driven by ROI, not evaluated by ROI. Break the assumptions of old marketing and opportunities are everywhere.
Tying marketing to revenues does require work, but the payoff in reduced risk and increased profitability makes it well worth the effort.
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