ROI ranks high on the list of great marketers’ obsessions. Marketers want to know what the money they are putting into executing their marketing strategy is getting them, and they also need to have solid and tangible data that they can pass on to their bosses. The company’s top management has little patience for the efforts of its marketers (as evidenced by the fact that CMOs have a very low tenure in their positions of power) and wants to see clearly where budgets are being spent and why.
The room for maneuver is therefore limited, but all this also makes measuring success become an obsession for marketers (and marking what they do and where they spend the money). Marketers want to be able to measure the ROI of their investment in a way that appears reliable and they move all their tabs to those indicators that show data of success.
But are they really betting on the most accurate Last Database measurement systems and obtaining the most accurate data to understand what their investment brings? Or are they just getting carried away by pressure and focusing on things that aren’t that important?
The charge that marketers are too short-sighted in what they do is not new. Analysts have been pointing out for some time that they are focusing too much on immediate results (partly because of that pressure from management to show clear results in a short time) and neglecting what happens in the medium and long term (and what it is, not we must forget, which will guarantee the survival of the company beyond the immediate moment).
But, in addition, this tendency to focus on the immediate is weighing down their measurement systems. They are, in short, mismeasuring ROI for it. In fact, that’s what a LinkedIn study on marketing and ROI just concluded .
Marketers are focusing so much on the short term that they are not accurately measuring what happens to their campaigns and what the real return is. The study has addressed what is happening in several countries, but has come to the clear conclusion that, in all of them, marketers are under such pressure to show immediate results that they are not doing well at measuring ROI.
58% of digital marketers recognize that they need to prove the ROI of what they have been doing to justify the expense and to get them approved for the future budget. Therefore, they have to be getting numbers all the time, although the relationship between marketers, their bosses and those numbers ends up becoming the whiting that bites their tail. Digital marketers who measure ROI in a month or less are twice as likely to face budget meetings at least once a month. That is, they are being more controlled and pressured than others.
Few are, in fact, marketers who make a long-term measurement of what they achieve with their digital campaigns. 77% of digital marketers surveyed measure ROI in the first month of the campaign and 52% do so in the first month, even though their sales cycle lasts three months or more. The number of digital marketers measuring the long-term ROI (six months or more) of their campaigns is minimal: they are only 4%.
Marketers are not fooled. Despite this situation, it is not that they believe that their measurement systems are the best. 40% of digital marketers do not actively share their ROI metrics. 63% of digital marketers admit that they do not feel very confident with the measurement systems they use.
Focusing on the wrong thing
To this we should add that marketers fail not only because they give little time to marketing, but also because they use the wrong meters. They are not measuring ROI, really, but using Key Performance Indicators (KPIs) and disguising them as ROI.
Since they focus on the short term, they use the leads generated or the cost per click of their campaigns as elements to measure the return on investment. 42% even recognize that they are their key metrics in ROI in digital marketing. However, as they recall in the study, those data are KPIs and not ROI meters.