Paying Off

Marketers are using more sophisticated metrics to determine the ROI of their cross-channel campaigns. But for many, keeping track of data across their organization is still a challenge.

These were among the findings of a recent survey by Epsilon, conducted with research firm GfK. Seventy-three percent of the 175 marketing decision makers and influencers (from companies with annual revenue above $250 million) said their firms ran multichannel campaigns. These businesses report an average 11% boost in sales from their cross-channel efforts.

The variety of metrics used by marketers to determine customer engagement, brand awareness and loyalty is increasing. In 2007, 41% of respondents looked for measurable “lift in return visits/loyalty” compared with 27% the previous year. In 2006, just 22% measured a customer's “likelihood to recommend.” Last year, the second time Epsilon conducted the survey, 35% said they'd measure this.

“Chief marketing officers continue to be under enormous ROI pressures and I think they're expanding the definition of what ROI is within their organizations,” says Epsilon CMO Michael Della Penna. “The marketplace today is complex. More and more marketers are looking beyond traditional sales increases to say thisis how program A or B has [performed].”

Della Penna was pleased to see the increase in categories such as “likelihood to recommend” and “return visits/loyalty.”

“This changing view in marketing ROI is expanding the role that marketers have within an organization to influence metrics and improve the customer experience and how companies interact with customers across multiple channels. [It also helps] them allocate budgets to those different channels.”

Many marketers still look only at the impact a campaign has within one channel. But the poll did show a 15% hike in companies that checked how a particular effort affected consumer relationships in various media. “It's not just a siloed view anymore,” according to Della Penna.

Of course, knowing who your customer is remains essential to achieving ROI goals. Fifty-seven percent of respondents said they didn't have a good understanding of what customer data was available, and 69% reported that they don't effectively collect customer data at all touch points. Some 53% said customer data wasn't easily available for marketing campaigns. And 41% needed help from their IT teams to use customer data, while 53% indicated they didn't have good data hygiene processes.

“The challenges around [gaining] access to data and being able to leverage that data across the organization continues to be a problem for many companies,” Della Penna says. “Marketers are going to focus more attention on solving that issue because of the value data can have in improving relationships with customers and acquisition efforts.”

Direct marketing in general seems to be front and center in respondents' minds given all the challenges CMOs face having to prove a campaign's results and impact.

“It's no surprise where the money is going,” Della Penna says. “You're seeing lifts in things that are measurable, like e-mail and online banners and search. Even direct mail spending is increasing, because it's a measurable channel.”

The study also showed 55% of integrated marketers devoting at least a portion of their budgets to social computing or word of mouth, and 67% keen on exploring the use of such methods in their campaigns. Blogs are used by 55%, podcasting by 54%, mobile marketing by 48%, RSS by 44%, interactive TV by 39% and instant messaging by 31%.

“I think marketers are looking at the ability to influence best customers and leverage that loyalty to expand the upsell potential,” Della Penna says. “This will be a big area of growth, especially when you consider how you can take that unstructured data and inform the relevance of your campaign.”

Data derived from social media can have an impact on search as well, Della Penna says.

“We'll start to see marketers using what customers are saying about their products to buy new keywords that maybe are not the most popular but are the way customers talk about their products,” he notes. “Capitalize on buzzwords and make your marketing much more relevant to the customer.”

Integrated Marketers Determine Success By…

	2007	2006	Year-Over-Year Popularity Boost
Lift in likelihood to recommend	35%	22%	+59%
Lift in return visits/loyalty	41	27	52
Lift in customer satisfaction	37	27	37
Lift in brand awareness	45	33	36
Overall lift across all channels	71	62	15
Lift in customer spending	34	31	10
Separate lift by channel	47	43	9
Source: Epsilon