CMOs and other marketing executives face key challenges delivering on direct marketing objectives through digital advertising (e.g. online and mobile). This is expressly true for those with high-value offerings like mortgages and other financial products. How do you reach the ideal consumer audiences effectively in a privacy-sensitive manner? How do you measure true ROI by matching offline conversions to consumers who saw your digital ads? Ultimately, how do you correlate traditional direct marketing spend with essential digital advertising spend and optimize marketing efforts going forward?
The Attribution Conundrum
Traditional direct marketers have been expertly executing direct mail, telemarketing and similar tactics to acquire new consumer prospects for decades. Knowing the consumers’ identities, along with a host of essential data insights, allows for efficient audience reach and effective post-campaign measurement. With digital advertising, however, consumer audiences typically are anonymous. Obtaining useful, accurate consumer data at high-scale is challenging. The subsequent ad campaigns are of questionable quality and so are the return-on-investment (ROI) measurement efforts that rely on misleading click-through conversions. So much insight is lost from the unfortunate and lazy over-reliance on tracking consumers conversion paths from them merely clicking digital ads. Here, effective ROI measurement requires matching consumers’ exposure to ads (not their ad clicks) with real conversions like applications and purchases.
Digital advertising in the form of online display advertising began about two decades ago. To be clear, the tens of billions of dollars in annual revenue generated, investments made and advertising technologies innovated have been immense. The overwhelming value that marketers have realized should continue evolving at an amazing rate. Despite all of this, we still fail to understand the true effectiveness of most digital advertising campaigns. As with the first online display ads in the mid-1990s, click-through conversions remain the predominant and misguided way of assessing digital advertising effectiveness.
Tyranny of the Click
An even more unfortunate dynamic is that the major advertising technology players trumpet the click as the primary digital campaign optimization method. Consequently, many direct marketers, confused by that deafening droning about click-through conversions, are left confused and paralyzed. Insensibly, many who then try digital advertising, rely only on click-driven analysis and so realize inadequate measurable conversions. Of course many marketers are afraid to try this type of targeted advertising again. Poor data quality dampens results and many offline conversions are immeasurable since the click-driven approach is employed.
The critical gaps are especially troublesome for direct marketers with high-value offerings in financial services. For instance, many home loan shoppers will not click a banner ad, and those who do, will not provide additional information that identifies them. A large number will do a lot of research and thinking about their bigger ticket expenditure before actually converting, perhaps 2-4 or more weeks later. Their ultimate conversions likely may occur over the phone or by entering the loan provider’s URL directly into a browser days or weeks later with no link back to any initial ad click. How do you connect these conversions to the original digital ad campaigns without matching digital ad exposure to an offline identity? You cannot!
The Call to Marketers
How can this disjointed, but frequently employed, approach to digital ad campaigns be acceptable to reasonable CMOs and marketing executive leaders? Marketers, especially those delivering high-value financial products, must be braver and resolute in filtering out the cacophony of noisy ad tech pitches. The venerable advertising technology providers do not have all the answers for direct marketers.
It’s time to have the wiser old heads of traditional direct marketing step in more forcefully to help drive digital advertising for direct marketing objectives. The clear recommendation is to leverage a proven hybrid traditional/digital strategy while being sensitive to consumer privacy. First, build, onboard and reach high-quality consumer prospects generated from a multitude of offline attributes. Second, measure what really matters: actual conversions matched to digital ad exposure. This is the more reasonable path to correlating your digital and traditional marketing spend and optimizing future marketing campaigns effectively.
If you’d like to explore this topic in more detail I encourage you to reach out to our Deluxe Marketing Solutions team and watch this on-demand webinar we did with Jim Marous from The Financial Brand called “Key Marketing Trends for 2016: Digital Strategies That Help Marketers Win” where we spend a good deal of time talking about online advertising attribution and measurement.