CLOSING THE EFFECTIVENESS GAP

Advertising measurement is in a state of unprecedented flux. For marketers, this will mean taking a less myopic view of campaign performance, and being more proactive in the measurement of long-term effectiveness.


Brands will find it harder to access and analyse user-level data as a result of increased privacy regulation, the deprecation of third-party cookies by Google (now scheduled for 2023) and the decision by Apple to require users to opt-in to ad tracking by mobile apps. Initiatives like Google’s Federated Learning of Cohorts (FLoC) encourage the analysis of audience groups, rather than individuals. Day-to-day online campaign measurement will involve lower levels of granularity.

TV measurement also finds itself at a crossroads, after Nielsen’s long-standing accreditation to measure national and local television in the US was suspended by the Media Rating Council. The rapid growth in connected TV viewing means the industry must find a way to reconcile traditional panel-based ratings with digital-style impression data.

For some marketers – particularly those with direct customer relationships – the solution to the impending third-party data crunch will be to double-down on first-party data collection. Nearly four-in-ten (39%) of respondents to the Marketer’s Toolkit 2022 survey believe that developing first- or zero-party data assets is their best response to the demise of the third-party cookie.

Not all brands will find it possible to build large first-party data pools, however: 85% of those surveyed by WARC expect their business to be impacted by data privacy restrictions, and over half (56%) agreed that building consumer profiles amid growing data fragmentation is the biggest challenge of marketing in a post-cookie world.

For some brands, the new data environment will prompt an exploration of insights that can be garnered from probabilistic data collection and analysis. This provides an opportunity to adopt more holistic measurement solutions, and to bring hitherto disconnected short- and long-term effectiveness measures closer together.

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CRACKING THE CROSS-CHANNEL CONUNDRUM

The third-party data slowdown is likely to cause a blurring of the boundaries between short- and long-term effectiveness measurement. This will have implications for brands in 2022.


KEY STEPIC DRIVERS

INDUSTRY Brand dissatisfaction with existing measurement techniques is the primary driver for this trend.

SOCIETY Consumers are increasingly concerned about privacy and have been pushing back on platforms.

POLICY Vocal concerns from regulators and politicians are also trend drivers.

TECHNOLOGY While clear solutions are not yet in place, the application of evolving technology can also help accelerate this trend.

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NEED FOR NEW MEASURES AND TECHNIQUES

The future of measurement will require the integration of a suite of solutions – and a coalition of collaborative partners – rather than a single do-it-all tool.

Over half (52%) of those surveyed by WARC for the Marketer’s Toolkit said they are looking to find “new measures of effectiveness”, while 42% acknowledge the need to invest in new technologies to measure audiences.

UK broadcaster Channel 4 recently reviewed its media planning and buying account, and the availability of tools for measurement automation was a primary factor guiding its selection.

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RE-THINK LONG-TERM MEASUREMENT

Thanks to developments in machine learning, measurement models like Diageo’s Marketing Catalyst are becoming both strategic and tactical.

Marketing mix modelling (MMM) can be run every few weeks, rather than quarterly or annually. Always-on live models can be fed with estimates and benchmarks to allow real-time optimisation. Even data rich digital platforms like Google and Facebook are encouraging brands to reconsider models over last-click attribution.

As a result, long-term effectiveness measurement is becoming a more active pursuit. Using artificial intelligence, this type of modelling can also explore future scenarios through “war gaming”. Advertisers can use those findings to prepare for changes to consumer and competitor behaviour.

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STRIVE FOR CROSS-MEDIA MEASUREMENT

Research has proved time and again that campaign effectiveness benefits from a multi-channel approach. According to Analytic Partners, the ROI from using three or more channels is 56% higher than using one channel alone. However, the ability of businesses to measure across channels and platforms is increasingly limited.

Initiatives to solve this conundrum will go up a gear in 2022. Project Origin – an initiative led by UK and US advertiser bodies ISBA and the ANA – claims to be able to sift through data from multiple channels to infer whether a person saw a campaign in different contexts. It does this through probabilistic matching and the use of a ‘virtual ID’, which combines privacy-compliant anonymised digital audience data with TV panel assets.

Such tools will help brands to understand reach and frequency, and prevent duplication across screens and platforms. Yet it is unlikely that programmes like Origin will progress far beyond the trial stage over the coming 12 months. The priority for marketers, therefore, should be to plan better against the data they can currently access.

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MARKET PENETRATION BECOMES MORE IMPORTANT FOR BRANDS

COVID has changed the way businesses measure success. More than half (54%) of all brand respondents now view market penetration/customer gain as the most important barometer of marketing effectiveness, up from 44% last year, as advertisers focus on converting target audiences. It has overtaken KPIs including sales, market share and ROI in popularity.

In contrast, ‘softer’ metrics such as awareness and social buzz are seen as less important in a post-pandemic environment. Only 32% of client-side respondents selected this option, down from 44% a year ago.

MORE BRANDS USE MMM

Brand lift studies remain the most popular measurement solution for brand marketers surveyed by WARC. However, the last 12 months have seen a marked increase in the amount of modelling carried out by advertisers to isolate the impact of their marketing investments.

More than four-in-ten (42%) respondents now use MMM, up from 35% a year ago, while 18% are using econometrics, up from 17%. Attribution modelling is now used by a third of brands (34%), despite challenges around cookie data. The percentage of clients that use no form of modelling has dropped from 29% to 23%.

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CASE STUDY

RECKITT: DEMOCRATIZING DATA


AGENCY Reckitt

ADVERTISER Reckitt Benckiser

MARKET Gain Theory, London

Reckitt Benckiser (RB), a British consumer goods company, needed to find a way to ensure its advertising was as effective as possible globally.

Each of RB's brands had different needs. The company needed to find a way to make decisions about its future marketing investment across brands and markets, as well as within brand-market units. It had to do this while using existing MMM methods, augmenting those with benchmarks and altering consumer demand and media supply assumptions.

RB used a bespoke version of global marketing consultancy The Agency's ‘GTi’, an always-on marketing decision-making platform. It allows clients to view their marketing ROI, plan for future scenarios and optimise their marketing investment.

As a result, RB exceeded its goals of maintaining sustained growth across multiple categories during a turbulent year.


RESULTS

  • Global net revenue increased by 14% which equals £46m of net revenue delivered for no increase in media budget.
  • Every unit that used the platform saw at least a 10% increase in net revenue through implementing the recommendations.

TAKEAWAYS

  • RB had access to a wealth of data and information, but lacked the right internal structure and centralised tools to share global access to use the data well.
  • The company was able to move away from looking back at the past through PowerPoint presentations for insights, to being able to make more agile decisions and boosting the productivity of its media.

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THE CMO VIEW

"At a channel level, we are continuously experimenting... we are going away from the last-click and attribution-based thinking versus scientific studies around incrementality of channels and how we are measuring them."

HIMANSHU SINHA VP, Digital Growth/E-commerce, Allbirds

"With the shifting media landscape, the deprecation of cookies and its impact on direct attribution, I believe that cross-media studies should be a fundamental aspect of through-the-funnel media planning and buying. Our hope is that the industry moves with these changes to focus less on last-click attribution, towards a more holistic view of media measurement."

EMMA SHELLER Global Head Brand & Marketing, Standard Chartered Bank

"We have a new method for measuring long-term marketing effectiveness, alongside a suite of tools to measure things that are more short term. You need to look at that whole thing holistically."

ZAID AL-QASSAB Chief Marketing Officer, Inclusion & Diversity Director, Channel 4

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TAKEAWAYS

FOR BRANDS WITH DIRECT CONSUMER RELATIONSHIPS, EXPLORING FIRST-PARTY DATA COLLECTION REMAINS THE MOST ROBUST PATHWAY TO UNDERSTANDING MARKETING EFFECTIVENESS

Advertisers without DTC business models in categories such as FMCG, food and beverages have succeeded in gathering customer data via other means, including events, content and loyalty initiatives. However, all data collection and management must adhere to local data privacy regulations.

BRANDS SHOULD CONSIDER UTILISING PROBABILISTIC DATA

Even the most data-rich companies will still face challenges when it comes to measuring the effectiveness of advertising investment. As third-party cookies and mobile ID data becomes scarcer, and businesses lack the deterministic data required to follow customer journeys across channels and walled-garden platforms, brands may benefit from probabilistic matching and data modelling.

TEST AND LEARN APPROACHES WILL BE REQUIRED

With cross-channel measurement initiatives some time away from being available to the majority of brands, marketers ought to see how they might benefit from solutions already on the market, such as AI-powered market mix modelling techniques. The right measurement solution will depend on your brand’s strategy, level of activity and marketing spend.

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