Is your measurement program growth orientated?

Or does it trap you in the past?

Econometrics and attribution are necessary but insufficient elements of a successful effectiveness measurement program. But they're often where measurement programs begin and end.

These methods leverage your historic first party data to distribute credit across different marketing efforts. The results can be used to optimise the mix, shifting budget from low to high performing channels, aiming to increase overall ROI.

But they don't know what they don't know.

If a certain marketing or advertising lever hasn’t been pulled before, it can’t predict it’s effect.

Used alone, they can lure brands into an efficiency trap. Marketers’ time is precious, and when too much of it is spent optimising last year's plan, the bigger effectiveness picture can be missed.

In an era of channel expansion and fragmenting media consumption, a focus on the past hamstrings growth. TV’s share of the media plan has halved since 2011 (AA/WARC data incl. BVoD), and the channels that have emerged in it’s place are greater in number, more complex in their offerings, and far faster to evolve.

Last year’s media plan has never been a worse guide for next year’s. Marketers need to look outward to keep up.

RUN GROWTH EXPERIMENTS NOT MEASUREMENT EXPERIMENTS

Experiments are a key part of the solution, but they have to be used with intention.

Measurement practitioners use experiments primarily for calibration and validation of econometrics and attribution results. This is useful, but the priority should be on identifying new growth levers for the business, not improving measurement quality. Experiments require prioritisation and sacrifice, they shouldn't be wasted on intermediate objectives like measurement accuracy.

Experiments create the most value when used to assess the profitability of new channels, tactics or to test scalability and synergy beyond previous bounds. Successful experiments surface new growth levers for a business, increasing effectiveness rather than simply optimising ROI through efficient allocation.

USE COMPARATIVE ANALYSIS TO GROW THE BASE

The base. “The level of sales you would get if you didn’t run any marketing activities next year.”

Econometrics often assumes the base remains unchanged over a three year model, while attribution ignores it entirely. Both assumptions are dangerous and constrain growth potential.

The base is sticky, but it’s not permanent.

It grows and decays in line with strategic shifts and exogenous shocks. Movement is slow, often imperceptible for a single brand over a three year period; but just because the process is slow doesn’t mean that it can’t be influenced.

The base is composed of brand attributes like mental availability, physical availability, pricing power and competitive density. These factors represent the effectiveness fundamentals, haloing onto in-year advertising performance and operating margins.

Each factor can be grown, and each is fragile. But sizing that growth potential using brand level data is usually pointless. Growing the base means going into unknown territory so there is rarely a useful reference point within your own data. A brand with low mental and physical availability today likely had low mental and physical availability 5 years ago too.

So to unlock these levers, brands have to look outward and compare their current position to the market at large.

What is our relative brand equity position? How does distribution or availability compare both on and offline? Do we have pricing power or are we reliant on under-cutting competitors for market share?

In other words, how would Byron Sharp or Warren Buffet assess my brand?

Collectively, the answers to these questions explain the in-year performance of a brand’s advertising; and most importantly how that performance can be step-changed over-time.

Analysis at the market level identifies headroom for growth and focuses collective efforts on the best bets.

ORGANISE MEASUREMENT AROUND A LEARNING AGENDA TO ENSURE GROWTH ORIENTATION

A Learning Agenda is a key attribute of a growth orientated measurement program.

Its a plan that captures the strengths, weaknesses, opportunities and threats seen by all stakeholders in a brand’s marketing effectiveness - from finance to general management to creative and media agency partners.

This is no political exercise to make all parties feel heard. The full spectrum of specialisms and viewpoints is necessary to see the full effectiveness picture, to prioritise initiatives and deliver against new levers for growth.

Critically, a good Learning Agenda is agnostic of any one measurement approach.

Measurement questions can often be dictated by the technique of choice, with the program then constrained by the limitations of that method. The measurement tail wagging the effectiveness dog.

A Learning Agenda identifies the business problem first, and shapes measurement solutions around that, ensuring an orientation towards marketing’s ultimate purpose - growth.

LOOK OUTWARD

Fragmentation requires a collective mindset shift for brands, agencies and measurement practitioners. The optimal media plan is a moving target and measurement programs can’t afford to stand still.

To succeed in this context, you need to spend as much time looking at what you're not doing as what you are doing. Optimising your existing plan can only add value a finite number of times.

Econometrics may not fully capture how brands grow, but that doesn't mean marketers can't take a scientific approach. It just means different tools and frameworks are required.

This means increasing the breadth rather than depth of analysis. It doesn’t require an increase in complexity, but an increase in creativity and ambition. An orientation to growth.