How to tell if your digital marketing campaigns are performing well

Decision-makers often divert funds from successful digital marketing campaigns due to a focus on the wrong metrics. Similarly, creatives that are delivering outstanding results are replaced prematurely by those who are very likely overwhelmed by data in reports or they are looking at incorrectly compiled reports.

Data-driven decision-making is rarely relied upon as well, with marketers and advertisers turning to subjective decisions that are counter-productive to their marketing ambitions and goals.

All digital marketing campaigns aim to deliver ads to the advertiser's current and future customers, and they provide a full-funnel benefit when the targeting strategy is sound.

Why then are marketing efforts routinely judged solely on misleading metrics like ROI and ROAS?

Those with an in-depth understanding of today's advertising technology will know that the limitations of tracking scripts alone makes measuring marketing effectiveness, and accurately attributing sales to the channel that actually influenced the sale, pointless and unwise.

Consumers also no longer follow the path of a traditional sales or marketing funnel. Studies have highlighted that consumers often bypass the consideration stage and purchase from brands that they've only just become aware of.

"We found that no two journeys are exactly alike, and in fact, most journeys don’t resemble a funnel at all," Google’s President of the Americas, Allan Thygesen, explained.

"They look like pyramids, diamonds, hourglasses, and more. Digital technology and mobile devices have put people in control. We all now expect an immediate answer in the moments we want to know, go, do, and buy. And all of these intent-rich moments are creating journey shapes as unique as each of us. In many ways, intent is redefining the marketing funnel."

Attempting to measure the effectiveness of digital marketing campaigns based solely on lower-funnel outcomes (Leads, Conversions, etc.) can lead to incorrect assumptions and rash decisions too.

Think about this scenario: a customer who has been served several ads from a clothing retailer on social media may never click on those social media ads, but could still be interested in the product after being exposed to those ads, and then they search for the product using a search engine and finally make a purchase directly from the advertiser's website at a later time.

In that example, the search engine would be credited for an organic sale, while the social media ads that influenced the sale gets no credit when using common methods to track and measure lower-funnel events (Sales, Leads, Conversions, etc.).

"Despite what the ‘growth marketers’ and ROI junkies might tell you on TikTok, the reason we build brand with half our budget is because it makes us more money." — Mark Ritson

The hyper-focus on 'growth' and 'performance' marketing these days fail to take into account the benefits of upper-funnel and full-funnel campaigns.

As Brand Consultant and Marketing Professor Mark Ritson points out in this excellent piece, "the reason we build brand with half our budget is because it makes us more money."

"If you split your marketing across upper-funnel [...] and shorter-term, rational, product activation, you will make more money. Not in year one. But across years one to five," Ritson adds.

When budgets are rebalanced to favour search engine marketing over social media marketing because analytics software attribute sales to search engines, a large segment of future customers on social media who could be influenced towards purchasing will be missed.

With internet browsers focusing on complying with rapidly-evolving privacy regulations, even attributing referral traffic to the correct source will become less reliable, which is another good reason why the way we measure the effectiveness of digital marketing campaigns requires an urgent rethink.

To accurately measure the effectiveness of digital marketing efforts, key performance indicators must be real-world business metrics, like bi-annual or annual sales revenue, and not metrics on analytics reports or data from any individual demand-side platform.

Attempts to calculate ROI for individual channels inevitably results in advertisers and marketers diverting funds from channels that are actually influencing sales. And being data-illiterate and unable to comprehend what metrics in reporting actually mean can also be detrimental to the success of a brand's overall marketing efforts.

The ability to analyze data and make sense of data is crucial, and it's just as important as logical measurement practices and realistic expectations, when it comes to determining the effectiveness of digital marketing campaigns.

No single metric should ever be relied upon to evaluate the performance of an entire campaign, it must be reminded.

By utilizing data from a combination of metrics, such as Impressions, Clicks, CTR, CPM, CPC, and others, campaigns can be optimized to deliver better outcomes. These metrics, however, should never be used to abandon one's marketing efforts entirely yet those of us employed in AdOps see it happen far too often.

Educating advertisers and client-facing teams in agencies of these facts and realities will help set the correct expectations amongst stakeholders, which will help avoid the impending pitfalls that those tasked with performance marketing will face, as the industry navigates through a privacy-first digital marketing ecosystem of the future.