By Dan Nevile
The latest Bellwether report delivered great news for the marketing sector, as well as the economy as whole, with the survey indicating the biggest net increase in marketing spend, since before the financial crisis struck.
Leading the charge was ‘digital’ with the intended net increase in spending being projected to be more than double the average for the marketing sector as a whole. This is perhaps not unexpected for two key reasons.
Firstly, the majority of our media interactions are now predominantly screen based, with recent Google research indicating screen based interactions now account for 90 per cent of the total, with smartphone, PC/laptop and tablets accounting for 38 per cent, 24 per cent and 9 per cent respectively. It goes without saying, but you need to fish where the fish are!
Secondly, brands understand that digital offers incredible opportunities to deliver consumer engagement, loyalty and advocacy through engaging, value added brand experiences. Economic conditions may have dictated that investment in value added, consumer engagement be somewhat curtailed in favour of the tried and trusted basics, but with confidence returning brands are once again striving to reinforce their emotional connections with consumers. With an estimated 10 per cent of marketing budgets in 2013 allocated to social media activity, there is clear evidence that engagement is high on brand agendas.
All good news then? Marketing spend projected to increase, digital spend leading the charge with social media and mobile being shining lights. Perhaps not quite, because a paradox exists. Whilst brands and agencies clearly believe that digital (and mobile and social in particular) is increasingly integral to the success of their communications strategies, and are increasing investment accordingly, their perceived ability to measure its return on investment (ROI) is diminishing.
This trend is clearly evidenced by a recent 2013 survey that reported only 50 per cent of brands asviewing their ability to demonstrate ROI to be ‘good’ or ‘very good’, astonishingly this is a 17 per cent reduction since 2010. A further survey, looking at mobile in particular, reported that just under 70 per cent of brands were struggling to identify and demonstrate the ROI for mobile marketing.
What does this mean? Well, in a nutshell, it would appear that there is currently a shared understanding of where further investment should be directed. However, it is also clear that for many this understanding is actually based on generic industry stats and gut feel, not factual evidence related specifically to the activity they have undertaken and the results it has returned. So, there is clearly a desperate need for brands and agencies to focus on developing meaningful ROI models to prove why they are and should continue to invest.
If confidence in the ability to measure ROI continues to diminish, gut feel and industry metrics alone will not be enough to prevent an eventual slow down in the investments being made. It is fair to say that many already understand this point and have made their own leap forward in developing their own, contextual ROI models, but many, many more have not.
So, with marketing spend projected to rise and confidence growing according to the latest Bellwether findings, perhaps the first and most important investment that needs to be made is in developing and agreeing the methodologies. This is vital to ensure accurate and adequate ROI to guarantee brand activity is relevant, timely and engaging for consumers.
This may well be at the short term expense of funding the acquisition of new fans, followers or app downloads, but investment, by it’s very nature, is about the long term, not the short term. The Bellwhether findings bode well for businesses across the country as they look to continue to drive the economy forward with digital at the forefront. Agencies will play a pivotal role in guiding brands through the ever evolving digital landscape.
About the author
Dan Neville works across WAA’s integrated communication teams, including PR, marketing and design, to maximise opportunities for digital marketing and drive forward mobile, social and web communication strategies. Dan has heading up digital teams for a range of high profile brands including Jaguar Landrover, Lucozade, JCB and Domino’s Pizza, 3M, City & Guilds, Vaillant and Westfield shopping centres.
WAA has been credited by the Sunday Times as being one of the UK’s top-100 Best Small Companies to Work For, for the last three years. The company employs 50 people and provides marketing and creative services to organisations including Westfield shopping centres, 3M and City & Guilds.