Three steps to developing a marketing effectiveness framework that lands with the C-suite

In recent years the topic of effectiveness has scaled the marketing agenda, symptomatic of marketing budgets coming under increasing pressure and a need to deliver a greater bang for every buck invested. Kantar’s latest annual Media Reactions survey saw marketers rank ‘improving marketing effectiveness’ as their top priority alongside growing sales and understanding audiences.

But the world of marketing effectiveness is complex. Marketers must wade through a plethora of contradictory opinions and ‘rules’ to guide investment decisions, and galvanising internal stakeholders behind strategy is a constant challenge.

New research by Google and Kantar has identified three defining traits of organisations that are successfully navigating this complexity and forging ahead in the perpetual quest for marketing effectiveness excellence.

Charting the course to marketing effectiveness maturity

Google and Kantar have collaborated to design new research with a mission to progress the industry’s understanding of advertising effectiveness and provide practical inspiration to help organisations succeed. The two-part project consists of a quantitative survey of 450 European marketing leaders, with a smaller number of in-depth qualitative interviews.

We developed a framework to describe how advanced an organisation is in terms of marketing effectiveness, based on various criteria such as perceived organisational alignment around goals and success criteria, and the number of tools used to understand effectiveness. Ultimately, we identify three stages of marketing effectiveness maturity: Establishing, Developing and Advanced, and comparisons across these groups are instructive for organisations looking to chart their own course to marketing effectiveness maturity.

So, what are the defining characteristics of Advanced marketing effectiveness organisations?

1. From fragmentation to a blended effectiveness ecosystem

There has been a recent resurgence in the ‘golden trinity’ framework, typically referred to at Google as the ‘trifecta’, with organisations combining experimentation, econometrics and short-term digital attribution to assess marketing effectiveness. One of the ‘Three Grand Challenges’ laid down by Google in its 2019 report on measuring effectiveness was to successfully combine these complementary methods. The blended approach has been backed by adam&eveDDB group head of effectveness Les Binet, amongst others, as the optimal blend of marketing effectiveness evaluation approaches.

Our research confirms that there is no single silver-bullet solution for measuring marketing effectiveness. Advanced organisations embrace a blended approach to provide a holistic picture, using on average twice as many effectiveness evaluation methods as Establishing organisations. The research also confirms that marketing effectiveness maturity is fuelled by the golden trinity, with controlled experiments typically the last method to be adopted by Advanced organisations, alongside digital attribution and econometrics.

But they are not stopping there. Advanced organisations are plugging a perceived gap in the trinity by integrating brand measurement to evaluate lasting effectiveness. Advanced organisations are five times more likely to believe in the importance of long-term marketing impact compared with Establishing organisations. And this is reflected in their evaluation approach, with Advanced organisations two times more likely to integrate brand measurement within their effectiveness ecosystem.

Kantar is helping brands to connect the dots with its holistic econometrics approach, UMMO (Unified Marketing Measurement and Optimisation), designed to rapidly integrate short-term and long-term marketing effects, and quantify the impact of marketing on brand and its relationship to sales. This is a crucial source of competitive advantage. Kantar’s Media Reactions survey shows that less than a quarter of all marketers (across advertisers, agencies and media companies) are measuring short- and long-term effectiveness in an integrated way, presenting a major effectiveness roadblock for most organisations.

2. From ROI as king to ROI as one part of the effectiveness puzzle

ROI also emerged as a key point of contention in the research. ROI continues to be widely used by the industry, with 69% of marketers interviewed identifying it as one of the most important effectiveness metrics, and 54% citing that the macroeconomic environment had increased the focus on ROI in the last 12 months.

But ROI has its critics. Jellyfish VP of brand strategy Tom Roach, for example, has highlighted how ROI can obscure the scale of effectiveness, favour fragmented spends, and perhaps most damagingly of all, encourage reduced marketing spend. The easiest way to boost ROI is to shrink the advertising budget, which ultimately restricts incremental growth and only serves to keep a brand small.

Focusing solely on ROI can be dangerous because, counter-intuitively, it’s likely to inversely correlate with growth.

Tom Roach, Jellyfish

Our research demonstrates that ROI has a constructive role to play, but only when used in combination with other meaningful metrics. ROI is the primary metric used by Establishing marketers, but as organisations mature they become less reliant on ROI and use it alongside other metrics to provide a more holistic picture of effectiveness. As businesses advance, ROI is blended alongside KPIs such as media-driven commercial impact (eg revenue, profit, etc), media delivery (eg reach, frequency, etc), digital performance (eg CPA, CTR, etc) and brand metrics (eg awareness, consideration, etc).

Effectiveness (incremental absolute outcomes) and efficiency (the cost required to achieve those outcomes) can coexist. But ideally brands should employ an ‘effectiveness first, efficiency second’ mindset, optimising primarily against net commercial returns whilst using blended scorecards that reflect short-term and long-term objectives.

3. From silos and misalignment to an organisational culture of effectiveness

The research indicates a disconnect between marketing and the C-suite – a gulf that is growing in the context of macroeconomic conditions and short-term pressures. Many marketers feel that they personally lack credibility with senior business leadership, and in Establishing and Developing organisations only 21% strongly agree that their organisation sees them as an expert in marketing effectiveness. 

Advanced organisations are transforming their people, tools, structure and processes to bridge internal divides and move towards a common vision. For example, Advanced organisations are five times more likely to agree that there is alignment between marketing and other parts of the business on how to assess marketing effectiveness.

Speaking in a panel at Kantar’s Ignite event earlier this year, Ruth Pignal-Jacquard (head of planning, insights and effectiveness at VMO2) and Owain Jevons (marketing performance and planning manager at TSB), described building an effectiveness culture as an ongoing process that takes time, investment and patience to implement. They advocated for a range of strategies such as investing in continuous stakeholder education, embedding tools that democratise access to marketing effectiveness data, and building trust with finance teams through accurate forecasting of longer-term outcomes alongside frequent reporting of short-term metrics that are indicative of a lasting effect.

Effectiveness means different things to different teams. For the finance team, effectiveness can mean efficiency and a focus on ROI, for example. With the easiest way to improve ROI being to cut media spend, marketing must look to build confidence in longer-term measures.

Ruth Pignal-Jacquard, VMO2

Three key actions to develop marketing effectiveness excellence

Our engagement with Europe’s senior marketing community has demonstrated that marketing effectiveness should not be thought of as a zero-sum game of winners and losers. It can be regarded as what game theorists describe as an ‘infinite game’ – one where the goal is continuous improvement to accelerate marketing effectiveness maturity. There is no silver-bullet solution, but together Google and Kantar are committed to helping the industry progress in its pursuit of marketing effectiveness excellence.

1. Build a marketing effectiveness ecosystem that integrates brand measurement alongside the golden trinity to ensure lasting brand value creation.
2. Use ROI responsibly and in combination with other KPIs to get the balance right between effectiveness and efficiency.
3. Commit to the ongoing process of breaking down internal silos through education, democratising access to effectiveness data and using more meaningful short-term metrics to build faith in the longer-term vision.

Richard McLeod is head of marketing effectiveness at Kantar Insights UK.

Jonas Bruus Christensen is Northern European marketing effectiveness lead at Google.