The Growing Complexity of Tracking Marketing Effectiveness

With the enhanced sophistication of today’s multi-channel marketing and loyalty programs, there is corresponding pressure on established evaluation processes.

How does one apportion the credit for a retailer who sells something online? Is it the retail store where the customer could see and feel the product? Was it the direct mail effort that drove him to visit the store? Was it the telemarketing group that answered objections or product questions before the customer placed the order on the Internet?

This evaluation challenge has existed for some time, but never to the degree it has today with the emergence of the Internet age.

What about CRM or loyalty programs? The increase in customer loyalty translates into share-of-customer growth and additionally, supports acquisition efforts. But what would have happened in the absence of any loyalty program?

All that is left is the option to isolate customers from these activities and set up control groups. But I have yet to see results that do not create more questions than they answer.

In today's multi-channel environments, it is almost impossible to isolate customers totally from their peers and other indirect influences.

As direct marketers, we may have to eat our words about lecturing to branders that they need to quantify their results to justify their enormous budgets. There are some things that no one can quantify.

Now that the distinctions between branding, direct marketing, sales promotion and other strategies are transformed by intense multi-channel marketing, we must create new ways of evaluating marketing efforts.

This is a good time to be a strategically inclined analyst.

New methodologies and testing structures must come to the rescue. To maintain our critical marketing budgets, we must validate their effectiveness with the scientific method and other ways yet to be discovered.

Is there something out there that will replace the simple ROI formula to reflect lost opportunity or the ability to keep customer’s happy with better customer service?

There are just some things that rely on common sense that will defy quantification.

Posted on October 17, 2007 and filed under Direct Marketing Strategy.