NEWS12 May 2023

Marketing effectiveness drops almost two-thirds in two years

News Trends UK

UK – Short-term performance marketing effectiveness has fallen 62% over the past two years, according to the Data & Marketing Association (DMA).

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The research, based on analysis of more than 1,200 DMA award entries from the last six years, comes as marketing budgets are increasingly under pressure due to the current economic situation, the DMA said.

The DMA and research firm Merkle have released a CMO Measurement Toolkit to help provide guidance to identify effective measurement and prove marketing effectiveness to senior teams.

Areas covered in the guidance include linking marketing spend to business outcomes such as return on investment, profit growth and long-term customer loyalty to help sell the organisational value of marketing, which the DMA said was only the case for 8% of marketing measurement key performance indicators in 2022.

Other recommendations in the guidance include assessing which metrics are linked to business outcomes, and contextualising marketing performance against benchmarks.

Stimulating future demand through brand building and rediscovering the “lost art of creativity” to drive campaign response are also recommended in the guidance.

Ian Gibbs, director of insight at the DMA UK, said: “The pace of change in marketing is hard to keep up with. New channels, platforms, metrics, and pieces of adtech kit flood the market on a weekly basis, each proclaiming that their relevance has superseded everything that has come before.

“Marketing effectiveness is below pre-pandemic levels for the second year running, so we must prioritise implementing effective measurement to combat the industry’s worsening measurement crisis.”

Azlan Raj, chief marketing officer at Merkle, added: “For today’s typical CMO, proving effectiveness is vital, even more so now that marketing budgets are tightly squeezed and pressure to compete with both traditional rivals and new market or category entrants is keener than ever.

“There is so much data that’s now at our fingertips that it can prove paralysing, as marketers struggle to keep their heads above the data flood and aren’t sure what to report upon.”