Striking a balance between noise and melody

Return on Investment (ROI) remains a sensitive and intricate subject in marketing, as it serves as the ultimate yardstick by which marketing teams’ success and individual team members’ performance are scrutinized.

Growth, funding, individual team members’ promotions, and their sense of prestige, —all of these critical objectives often hinge on the ability to demonstrate a robust ROI. It is, without question, the most frequently discussed and debated part of day-to-day marketing operations. Yet, it is also the most contentious, sparking spirited discussions and differing perspectives across the industry.

Drawing from my extensive conversations with Chief Marketing Officers, Brand Managers, and Media Heads, I have come to discern that there are fundamentally two distinct lenses through which ROI can be viewed. 

One type focuses on the immediate metrics—the "noise"—while the other seeks to capture meaningful results—the "melody."

To my mind, every outcome carries significance, but certain outcomes undeniably hold greater weight in the grand scheme of marketing objectives.

Type 1: 'Soft' ROI from direct results

When we examine the direct results of marketing efforts—those tangible outputs that may or may not directly translate into the ultimate outcomes we aspire to achieve—the focus shifts to the quality and precision of execution. This metric, often referred to as "Soft" ROI, involves the immediate, measurable impacts of a campaign.

Consider the following examples of direct results, categorized by various marketing channels:

• Television: Eyeballs, quantified through Gross Rating Points (GRPs), reach, and frequenCirculation and readership data specific to each market.
• Search: Engagement metrics such as impressions and clicks, further distinguished between branded and non-branded searches.
• Video and digital: Engagement and virality, including views, clicks, shares, and comments.
• Social media: Engagement and community metrics, such as likes, shares, comments, follower growth, and mentions.
• Events and activations: Attendance, interactions, social media mentions, and lead captures.
• Influencer marketing: Engagement and virality metrics, including impressions, comments, explore page visibility, and shares.

However, achieving high GRPs or frequency does not guarantee an increase in market share, does it? Similarly, a surge in impressions, clicks, likes, or shares does not automatically translate into sales growth. 

Soft ROI is fundamentally about assessing the execution of a campaign—comparing planned activities against actual outputs—rather than measuring the overarching strategy or the ultimate outcomes.

This evaluation of execution is a critical initial step, and additional dominoes must fall to realize longer-term gains. Yet, if the underlying strategy is misaligned, all these meticulously tracked efforts risk becoming mere "noise" in the minds of customers, failing to resonate or drive meaningful impact.

Type II: 'Hard' ROI from final outcomes

In contrast, Hard ROI focuses on the indirect, yet vital, results that marketing campaigns ultimately deliver—the tangible outcomes that define success.

Examples of these final outcomes include:

• Revenue and sales uplift, reflecting direct financial impact.
• Market share expansion in both existing and newly penetrated markets.
• Improvements in brand recall, strengthening consumer awareness and affinity.
• Increases in repeat purchases, often indicated by a higher Net Promoter Score (NPS).

Hard ROI represents the final destination—the definitive metrics that can be confidently presented to stakeholders with a declaration of "Job done" or "I rest my case." It is the immediate, measurable impact of an investment, whereas Soft ROI points to the potential value of an investment that may accrue over time. 

In essence, only a fraction of the "noise" generated by Soft ROI metrics transforms into the "melody" of meaningful, outcome-driven results.

Quite often, Soft ROI metrics can be misleading, representing mere noise rather than progress. While both Soft and Hard ROI are indispensable for evaluating the success of a campaign, an over-reliance on Soft ROI can lead to false perceptions of traction. Such metrics may create an illusion of success without delivering tangible benefits to the brand or business.

Consider these examples of misguided Soft ROI metrics:

• Ad fatigue: Excessive exposure to repetitive ads, such as relentless pop-ups or aggressive retargeting, can irritate audiences rather than engage them.
• Irrelevant targeting: Promoting products or services to audiences who are uninterested or misaligned with the brand’s offerings.
• Misleading metrics: Inflated impressions driven by automated bots or accidental clicks, which distort the true impact of a campaign.
• Poor content relevance: Generic or repetitive messaging that fails to resonate, leading to disengagement and potential dilution of the brand’s identity.

Lead nurturing spamming: Overly frequent follow-up campaigns lacking personalization, resulting in perceptions of spam and high unsubscription rates.

As we scrutinize each marketing channel, we see numerous instances of this same phenomenon—results that appear promising but ultimately fail to deliver meaningful outcomes. Such missteps risk undermining brand perception, eroding consumer trust and credibility, and diminishing responsiveness over time, which could ultimately harm the brand’s reputation and its relationships with customers.

Soft ROI as an indicator of Output, not Outcome

When planning budgets, onboarding vendors, and reconciling invoices, marketing teams manage a complex ecosystem of simultaneous campaigns, activities, and stakeholders (inputs). To achieve the desired outputs—such as GRPs, impressions, and engagement—and ultimately drive outcomes like sales and brand lift, an efficient system for tracking and aligning these inputs is essential.

For superior outcomes, a well-crafted strategy is important to ensure that inputs and outputs are harmoniously aligned. Without a robust strategy, the inputs can devolve into grunt work—execution devoid of a clear focus on the final result. As we have seen, the successful completion of execution alone can be deceptive, often masking a failure to achieve overarching brand objectives.

It is the strategy that serves as the linchpin, bringing together disparate efforts into cohesive, results-driven campaigns.

My recommendation for positioning ourselves for success with a winning strategy

Based on my observations, many marketing teams, despite achieving their brand goals, continue to operate in silos, grappling with fragmented data sourced from multiple platforms—whether for budget planning, vendor management, invoice reconciliation, monitoring planned versus actual performance, or tracking ROI.

Having dedicated a significant portion of my professional career to addressing this challenge, I can confidently assert that the solution lies in three key approaches:

1. Pursuing ‘clean’ and authentic ROI Data: Prioritizing genuine, high-quality metrics over the mere accumulation of superficial data points.
2. Regular validation and critical evaluation of Soft ROI: Ensuring that Soft ROI metrics align with strategic business outcomes through consistent scrutiny and analysis.
3. Centralized management of marketing operations: Streamlining all marketing activities and vendor interactions within a single, unified platform or standard operating procedure (SOP).

This vision becomes achievable through the adoption of a unified system that integrates all stakeholders and relevant data onto a single platform in real-time, enabling seamless collaboration and informed decision-making.

I hope this perspective provides clarity and actionable insights for your marketing endeavors.

Happy marketing, and I look forward to connecting with you again next week!

Robin

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