In 2022, Google and Meta’s combined advertising market share fell below 50% for the first time since 2014, standing at 48.4%.
The shift is attributed to the rise of other digital ad platforms like TikTok and Amazon. TikTok's share of the digital ad market more than doubled in 2022, while Amazon accounted for 11.7% of U.S. digital ad spending last year.
With every new platform, comes another attribution model, further muddying the waters on how to measure performance and impact of these efforts.
In the world of digital marketing, the path to purchase is not a straight line but rather a complex maze. For B2B and lead generation businesses specifically, understanding this journey is crucial.
A common pitfall lies in evaluating marketing channels in isolation, particularly platforms like Meta and YouTube. This approach often leads to hasty decisions to cut budgets based on perceived low ROI, neglecting the intricate web of interactions that drive the final purchase.
The Customer Journey in the Digital Era:
The digital era has transformed how customers interact with brands. Each touchpoint, from an ad impression to a website visit, plays a critical role in guiding potential customers through their journey.
For startups and B2B companies, the challenge is two-fold: ensuring visibility to an audience unaware of their existence or need for their solution, and constructing a marketing journey that effectively builds their pipeline.
Businesses should dig into their analytics data to understand the various touch points their customers and prospects are already making while interacting with their website. This will provide some insight into the number of interactions prior to conversion and across what marketing channels.
Remember that no analytics or attribution tool is perfect. There are still a number of users that will not be tracked. This is why it’s also important to view performance holistically for your marketing mix.
Measuring Holistic Impact:
The quest for a one-size-fits-all tool to measure marketing impact across channels remains elusive. The key lies in integrating and analyzing data from various sources – in-platform metrics, web analytics, and CRM data. This approach helps in drawing a comprehensive picture of marketing effectiveness. Regular testing of different media mix models, while keeping a close eye on data setup and integration, can further refine understanding of channel performance.
Still unsure? You can always try testing your media mix model for set periods of time. Depending on your lead-to-close cycle, this could be in increments of 30 days or 6 months. Most importantly ensure you have all data integrations in place. Then map out your marketing mix.
[TIP] Google Analytics Conversion Paths report is a great tool for measuring holistic impact with visuals to gain a better understanding of your customers’ paths to conversion, and how different attribution models distribute credit on those paths. Typically you will see organic and Paid Social efforts make up the bulk of early and middle touchpoints while late touchpoints are filled with higher intent platforms like Paid Search.
Addressing Low ROI Perceptions:
A channel's low ROI in isolation doesn't necessarily indicate its ineffectiveness.
For instance, a platform like YouTube might show lower direct conversion rates, but its impact often manifests in other channels like organic search or direct visits. An advertiser’s experience, where cutting YouTube budgets led to an overall decline in sales and revenue, is a testament to this interconnectedness. Thus, a holistic view of performance is essential before making budgetary decisions.
Alternative Strategies and Holistic Decision Making:
When contemplating budget cuts, it's crucial to consider the entire marketing ecosystem. Analyzing holistic performance reports before and after such cuts can prevent unintended negative impacts on overall sales and revenue goals. Shifting focus to higher-performing channels or those with more market share potential is a common alternative strategy. However, the real opportunity lies in delving deeper into the customer journey, ensuring alignment in targeting, messaging, and web experience across channels for a seamless user experience.
In order to begin understanding the complex paths of your potential customers, here are the few key steps we recommend.
- Web Analytics. Ensure your Google Analytics property is set up properly, recording the right on-site events, and even importing from your CRM. Also ensure the basics from this checklist are covered. Proper setup of web analytics allows for a comprehensive understanding of how users interact with your site. This data is crucial for evaluating the effectiveness of different marketing channels and understanding user behavior.
- Integrating Offline Conversions. Import your offline conversions into relevant and compatible channels such as Google Ads, Meta, etc. Including offline conversions provides a more complete picture of your marketing effectiveness. It helps in understanding the full impact of digital campaigns on all types of customer conversions, not just those that occur online.
- CRM Integration. Assess your CRM system to ensure that ad tagging is properly implemented, capturing and feeding through relevant data to your marketing platforms. Effective CRM integration allows for a more accurate attribution of marketing efforts to sales outcomes. It helps in understanding which marketing initiatives are driving actual sales, leading to more informed marketing decisions.
- Holistic Reporting. Develop comprehensive reporting that encompasses all marketing channels, both digital and traditional. This should include data integration from various sources for a unified view of marketing performance. Holistic reporting enables a complete understanding of how different marketing channels interact and contribute to overall business goals. It helps in identifying synergies and optimizing the media mix for better performance.
- Marketing Mix Modeling. Implement marketing mix modeling to analyze the effectiveness and ROI of different marketing channels. This involves statistical analysis to understand the impact of various marketing activities on sales and other key performance indicators. Marketing mix modeling provides insights into the effectiveness of different marketing channels and tactics. It allows for data-driven decision-making on budget allocation and strategy optimization, ensuring maximum return on marketing investments.
By implementing these actions, businesses can ensure a more effective and data-driven approach to diversifying their media mix, leading to improved marketing performance and ROI.
At a minimum, view the overall performance of business objectives alongside your specific marketing objectives.
In many cases, cutting budgets in one channel, based on isolated ROI assessments, can be detrimental to overall marketing performance. A holistic approach, considering the intricate interplay of various marketing channels and touchpoints, is critical. By understanding and leveraging the full spectrum of digital interactions, businesses can make informed decisions that propel their growth and success in the ever-evolving digital marketplace. This holistic view ensures that all aspects of digital marketing work together synergistically, improving the overall effectiveness of your marketing efforts and positively impacting your ROI.