Covid lessons on marketing effectiveness lost already

dataAll the evidence might point to marketing spend not only bouncing back from Covid but hitting record levels, yet it seems marketers have already forgotten the lessons learned during the pandemic with marketing effectiveness falling – down by nearly a quarter (23%) – as response effectiveness plummets.

That is the worrying conclusion of a new DMA report, in partnership with Salesforce, which is the latest edition of the Meaningful Marketing Measurement research. Building on the key effectiveness principles established in the inaugural report released in 2021, this updated analysis includes fresh campaign data for the previous year.

The research gains its insights from the 1,000+ DMA Awards entries dating back to 2017 that make up the DMA’s Intelligent Marketing Databank. These are designed to provide a perspective on the evolution of marketing effectiveness in recent years, including views on multi-channel, brand, response, retention and acquisition campaigns.

A key finding of the report is that marketing effectiveness has declined by 23% in 2021, with the average campaign generating 2.4 effects in 2021, down from 3.1 effects in 2020 – the highest figure recorded since 2017.

Meanwhile, an analysis of the role of response and brand effects shows that masked in this overall effectiveness decline is a marginal improvement in the brand effectiveness of campaigns in 2021 (up from 0.5 to 0.6 brand effects year-on-year).

This position has, however, been outweighed by a 24% decline in response effectiveness over the same period (falling from 2.1 to 1.6 response effects year-on-year).

Another key issue highlighted by the report is that marketers continue to measure the performance of campaigns without evaluating their true value. Many marketers are measuring metrics that are most accessible, not what really matters to the business.

Of the 170 measures used by DMA Award entrants, 41% relate to campaign delivery measures, and 59% to business, brand or response effects.

This picture has remained stable between 2017-2020 and even 2021, indicating that no significant progress is being made in how the industry measures campaign impact.

For this to change, there must be a more unified approach adopted across the industry – including agreement on the terms that are used to define effectiveness and a framework to understand the true value of marketing’s success.

DMA director of insight Tim Bond said: “In the early phase of the pandemic, after three years of consistent marketing performance, there was a distinct boost in marketing effectiveness.

“However, in the latest pandemic phase this trend has been reversed, with the effectiveness lessons learned in the previous few years seeming to have been lost as volume and spend return to the ad market.”

The report reveals that campaigns which focused on a combination of brand building and response, while targeting new and existing customers together, tend to drive more effects overall.

Bond added: “Understanding the deficiencies in measurement models and organising campaign measurement, as well as learnings, into coherent organisation-wide measurement frameworks is a crucial step on the path to promoting the role of marketing spend within the business.”

Salesforce EMEA product marketing director for Marketing Cloud Jonathan Beeston concluded: “The digital-first customer and data privacy changes are forcing brands to become data-first in their marketing. This report shows how critical it is that marketers meet this challenge head on. Not only to demonstrate the effectiveness of their marketing, but to build trusted relationships with their customers that create revenue and loyalty.”

Further information can be found on the DMA website> 

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1 Comment on "Covid lessons on marketing effectiveness lost already"

  1. Not sure I’m down with these findings. It seems fairly logical that spending more on advertising would lead to a reduced response rate, unless there are new audiences recently uncovered. And surely in a cost of living crisis you would expect response rates to fall. And the most effective marketing is targeted at both response and brand, targeted and existing audiences? Sounds like a confusing brief to me.

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