12/04/2020

How Brands Can Evaluate ROI for Digital Media

Featured posts | Insights

6 min remaining

Article at a Glance:

  • While marketers are under increasing pressure to demonstrate the effectiveness of the digital media they produce, source, and distribute, they have a wide range of tools at their disposal to do so.
  • Marketers need to go beyond superficial indicators of performance and determine whether an investment is driving consumers to take desired actions.
  • Video remains one of the most powerful forms of media for capturing and holding consumers’ attention. According to Nielsen, of the 10 and a half hours U.S. adults spend consuming media each day, more than half of that time is spent watching video.
  • Brands need a way to determine which types of media are resonating with consumers, which is why they should be just as rigorous in tracking KPIs and business outcomes with UGC, paid media, and all other categories of digital creative assets.

For today’s marketers, nothing is more important than accountability. Brands are no longer content to spend large sums of money on digital media assets and campaigns without a clear return on investment. This demand has coincided with the increasing availability of digital marketing attribution resources that allow brands to track how their ads are performing and use what they learn to develop new strategies and content. 

At a time when brands have more consumer touchpoints than ever before, they’re constantly inundated with feedback on their digital marketing. But what’s the value of a like, share, or comment? Is this sort of engagement actually leading to higher conversion rates, customer retention, and other concrete indicators of performance? These are the questions marketers have to answer, particularly when it comes to media with high production costs such as video. 

While marketers are under increasing pressure to demonstrate the effectiveness of the digital media they produce, source, and distribute, they have a wide range of tools at their disposal to do so. This is why they should view the demand for accountability as an opportunity to prove that their work is resonating with consumers and securing quantifiable financial goals. 

A new era of accountability in digital marketing

According to Gartner’s 2019-2020 CMO Spend Survey, the top two marketing capabilities cited by CMOs are “market research and competitive analytics” and “marketing analytics.” This is consistent with the findings Gartner has been reporting for years – marketers have to justify their budgets by demonstrating clear return on ad spend (ROAS), as measured by key performance metrics like sales revenue and lead-to-customer ratio. 

The burden of proof is even higher for digital media that requires greater investment like video. While it looks impressive when a video has tens of thousands of views, that’s a surface-level measure of its impact. Marketers need to go beyond views, shares, and other immediate (often superficial) indicators of a video’s performance and determine whether it’s leading consumers to take desired actions, building brand trust and loyalty, and ultimately generating enough revenue to significantly offset the cost of producing it. 

As communication channels and formats for videos have proliferated, the resources for gathering and analyzing data about their performance have become more accessible and sophisticated. This means data-driven marketers can show brands which types of video content work and which ones don’t across the ever-expanding array of platforms that consumers use. 

Tracking the effectiveness of video content

Brands and marketers have many variables to consider when they assess the impact of a piece of video content. Even when it comes to the initial performance indicators listed above (views, comments, likes, and shares), there are deeper levels of analysis that marketers have to take into account, such as the amount of time consumers spend watching, how they’re sharing it and with whom, how many of the views are unique, etc. 

The number of platforms for video content is massive, making multi-touch attribution one of the most effective ways to track performance.

But the more important measures of performance tell brands and marketers what specific business outcomes their video content is securing. For example, marketers can conduct split tests to discover how different video ads can lead to higher conversion rates and increased brand lift, the performance of these ads with different audiences, and how the manipulation of a wide range of variables can affect ad performance. Many ad platforms (such as Facebook) provide tools to split test videos and track their performance in other ways, but brands can also analyze the impact of their content on multiple platforms at once. 

The number of platforms for video ads has exploded, which has made multi-touch attribution one of the most effective methods of tracking video performance. When a brand publishes a video, there are many ways in which it can lead to a conversion, from follow-up emails and ads to website visits. Multi-touch attribution assigns credit to each stage of the customer journey in proportion to its role in an eventual conversion (or some other desired behavior). 

No matter what KPIs you choose to focus on or how you track them, brands have never had more ways to determine whether or not their investments in digital media are paying off. 

The future of digital media attribution

Video remains one of the most powerful forms of media for capturing and holding consumers’ attention. According to Nielsen, of the 10 and a half hours U.S. adults spend consuming media each day, more than half of that time is spent watching video. This is why it’s all the more important for brands to be capable of measuring how their video content is driving sales and achieving other tangible business goals. 

Although it’s true that video production is often a resource-intensive way to acquire and retain customers, we’re also entering a period of democratized media that has driven down costs and allowed brands to experiment with dynamic platforms and types of video content. For example, as high-quality video production equipment and software has become far more affordable and accessible, brands have been deploying more and more user-generated videos in their campaigns. This increases the perception of authenticity, which leads to higher engagement, brand trust, and conversion rates.

However, this doesn’t mean traditional media production is on its way out. Brands need a way to determine which types of media are resonating with consumers, which is why they should be just as rigorous in tracking KPIs and business outcomes with UGC, paid media, and all other categories of digital creative assets. 

There are many trends converging around greater accountability and attribution in digital media marketing. Brands now have the resources to carefully assess ROAS across formats and individual pieces of video content, which means they’re fully equipped to build digital media campaigns that are well worth the investment. 

About the author

TOM RICHARDS is the Vice President of Client Success at Kobe Digital. He brings a wealth of experience to our organization from his time working with brands such as Apple, Starbucks, and Expedia at agencies including BBDO, Campbell Ewald, and M&C Saatchi.