Your businesses’ Digital Marketing capability has never mattered more- but are you able measure what’s working and what‘s not?
Some of this article is quite techy, so let’s get to the important takeaway first: you need to be able measure how your digital marketing budget is performing so you can improve the returns it generates for you. As digital becomes an increasingly important part of your business, good measurement is the foundation of your decision making. It’s as simple as this, the better your measurement and attribution, the greater your sales revenue will be for any given budget.
Whenever I’m involved in a discussion about advertising the famous quote from Drucker stands juxtaposed in my mind with John Wanamaker’s equally famous quote, ‘half of the money I spend on advertising is wasted; the trouble is I don’t know which half.’ We all know that being able to measure advertising outcomes matters, but unfortunately all too often, attribution is incomplete, unreliable or poorly understood.
Attributing your marketing budget to sales can be challenging for a lead generation website (if you generate leads online that you close offline as most KBB retailers do yours is a lead gen website) but it’s the cornerstone of a digital marketing strategy.
What do we mean by attribution?
Basically, marketeers and businesspeople want to know not just what sales revenue is, but where that revenue is being generated from. When you develop or use data analysis tools or software that does this, you are analysing attribution.
Why does attribution matter?
Your business probably generates leads from numerous sources; referrals from previous clients, local magazine or newspaper advertising, people just walking in off the street, and from digital advertising spending on Google or Facebook etc. If your business can’t effectively attribute leads or sales to these channels, then your advertising spend may be inefficient- maybe even to an extent Wanamaker would recognise.
Imagine your digital spend outperformed magazine advertising by 3:1 (it’s probably more), but you were unaware of this- you might be spending more money on magazine advertising than you do with Google and as such significantly misallocating your budget. The same theory applies in more granular detail throughout your advertising budget… should you be reallocating between Facebook and Bing advertising? Which campaigns or ad groups are performing better than others in terms of the number of quotes or revenue they generate?
How do I attribute sales to my digital spend?
This can be a challenge, and there is some technical complexity that most KBB business owners won’t want to explore themselves but should ensure is being done for them, so here’s a brief overview split into the basic, the advanced, and the best-in-class.
- You must have ‘conversion tracking’ set up on your website. This is a tracking script (just some computer code Google generates for you) that fires a signal to your advertising platform.
- The tracking script must be fired only when a user completes a desired action such as completing a brochure download form or booking a home visit with a designer.
- You must have your analytics packages configured to calculate on a ‘one per click’ basis (otherwise someone downloading a brochure and using ‘click to call’ gets double counted)
I’d describe this as a universally accepted minimum standard, and it needs to be carefully verified as working properly to be of value. If you are doing this, you’re probably doing better than a lot of your local competitors already.
The problem with this is that all conversions are counted equally- and that just isn’t so. For example, someone who books to come into your showroom is almost certainly more likely to convert into an Opportunity (someone you produce a design and quote for) than someone who just downloads a brochure. In this instance, you need a way of weighting conversion data to reflect this. To do this you need to generate accurate data to a sample size in which you have confidence, wherein you can accurately measure the relative performance of your conversion tools- and then configure your ad management software to reflect this. Tricky? Somewhat, but doable and worth the effort.
Best in class:
The above only looks at your site conversion tools which is only part of the story. Imagine two people visit your website and both download your brochure; one searched for ‘Bespoke kitchen with Miele appliances’, and the other for, ‘small kitchen for buy to let.’ Even if both became opportunities, the former may close for a multiple of the latter and thus be a lot more profitable.
The ultimate aim is to ‘tag’ each lead, opportunity and sale with all of your campaign parameters, such as ad group, keyword or advert and communicate that offline activity back into your advertising platform. If you can achieve this, you can move your campaign to automated bidding, which will use a construct of your detailed attribution to allocate your marketing budget for you. In other words, wastage can be greatly reduced, and success reinforced- with the focus being on actual sales revenue. Sounds great doesn’t it?
Unfortunately, this is difficult to achieve for many KBB retailers for a few reasons:
- You may not generate enough conversion data each month for automated bidding to work.
- You’ll need a Customer Relationship Management software platform that allows you to tag each lead with this data automatically (In the case of Google this means associate each lead and opportunity record with a GLCID)
- A GCLID has a 90 day expiry window- so if a large proportion of your sales occur more than 90 days from lead inception to close, they won’t be counted- skewing your data.
If you can’t leverage the best of Google’s tech, what should you do?
The answer is unique to each business, but simply put you do the best you can. You can stick to manual bidding but add data columns that let you see the data imports for offline conversions and see the Return on Ad Spend data based on your relative conversion weighting. This helps you make more informed decisions by providing insight beyond the basic tracking of from completions.
Not many KBB business managers have the technical skills to optimise digital marketing attribution, but equally not many professional marketeers working at digital agencies have the insight of running KBB retailers that allows them to understand the unique challenges marketing KBB businesses involves either. Ultimately, it’s a big part of why Lead Wolf exists. Certified in Google Analytics and Measurement, we can construct a data measurement solution that best fits your business, resulting in more revenue and profit from your marketing budget.