5 Steps to Improving Marketing Effectiveness in 2019

This month we headed down to London to get the latest insights from some of the industry’s best minds at the IPA’s annual Effectiveness Week conference. As a precursor to the evening’s glitzy IPA effectiveness awards, which awarded gold to campaigns for the likes of Direct Line and The AA, speakers explored the ways in which companies and agencies alike can develop sustainable effectiveness cultures.

As well offering Naga Munchetty (compere for the day and BBC Breakfast presenter) a welcome respite from Trump’s posturing and daily Brexit mishaps, the various presentations and panel discussions reiterated five themes that can be used to propel effectiveness to the top of the agenda as we all enter the definitive stages of the 2019 planning season:


1.) Place creativity at the heart of all advertising

This sentiment is nothing new, but with the rise in data-driven (as opposed to data-informed) marketing offering up risk averse alternatives to hard-fought Big Ideas, it’s easy to see why creativity has become a necessary sweetener rather than the driver of commercial success. Enter Orlando Wood (of System1 Group), whose research has uncovered a direct correlation between emotionally resonant creativity and long term sales growth.

Advancements in behavioural economic theory have proven that we, as consumers ‘think much less than we think we think’. The notion that the majority of everyday decisions are rapidly made and principally steered by emotion and experience means that advertisers have a need to create a fluency/mental shortcuts between the consumer and the brand meaning that the former is able to recognise it quickly and is assured that it is a good choice.

Wood contends that around half of all advertising spend in the UK and US contributes little to long term growth, as it focuses on rational communications over provoking positive emotional responses that help to nurture these ‘mental shortcuts’. Referencing M&M’s ‘Scott’s home early’ ad and Anchor’s ‘that’s the good stuff’ campaign amongst many others, the research shows how these executions harnessed positive emotional responses through the use of characters (or more specifically ‘fluent devices’), which when combined with a competitive share of voice equated to disproportionate market share gains. This uplift in effectiveness also extended online (e.g. online video, display advertising) with spikes in direct response metrics (e.g. clickthrough/viewthrough rate) demonstrating that all elements of the marketing mix can stand to benefit from the initial creative leap.


2.) Implement a culture of effectiveness

A study into ‘marketing effectiveness culture in practice’ that was discussed during the day revealed that only 9 of the 100 internal brand owner survey participants (including marketing, research and finance department staff) strongly agreed that their company prioritised the correct mix of resources (people, capability, systems and structures) to support marketing effectiveness. Gain Theory’s Jon Webb opined that de-siloing data from different departments was the main way to reconcile this disparity and ensure that effectiveness becomes a shared responsibility.

The key to integrating this culture is to firstly establish the ‘value creation zone’ of a brand and set common objectives that seek to deliver this seamlessly and measure its success accordingly. Indeed only 14% of the same respondents strongly agreed that the marketing success criteria had been established across all relevant stakeholders and business areas. Overcoming internal politics and the issues faced by data being stored in different systems and departments allows us to bypass inconsistent answers to what is happening and why it’s happening.

Only with these foundations in place, can organisations enter what Webb labels the ‘test and learn’ phase of measuring effectiveness. This is vital for looking beyond insights and effectively embedding change. It follows that a culture of test and learn can understand failures, embrace them and leverage them when delivering change.


Matt Lucas on stage


3.) Market marketing internally

The Achilles heel of marketers was unanimously agreed to be internal communication, specifically with the finance department. In her lecture on ‘building bridges with finance’ Fran Cassidy argued that the rise in automation of pure financial activities has resulted in the function becoming more focussed on increasing performance than reporting. In order for marketers to speak in a common language they must first become financially literate.

Understanding the meaning of (what Cassidy intimidatingly termed) ‘machometrics’ such as ‘organic revenue growth’ can help marketers become part of the defining strategic conversations. Guest speaker Steve Langan, CEO & CMO of Hiscox, saw the simplification of ‘marketing speak’ as the most significant transformation behind the two functions moving away from suspicion and hostility and towards collaboration.

Financial teams are ideally placed to unlock the potential of marketing, but it is incumbent on marketers to stress how strong brands are central to progressing drivers of growth, namely customer acquisition, price improvement and mental availability. Successful implementations of this have led to a rise in what is known as ‘capex mentality’. This principle regards certain marketing expenditure as capital rather than operational expense, preserving the long term focus of a marketing strategy. These developments are fundamental for marketing departments to transition from a justification culture to one that focuses on ‘test and learn’.


4.) Develop a tailored measurement strategy

During one panel discussion, Sky’s Aji Ghose (head of research and analytics) described the painstaking lengths they were forced to go to when reducing their 2,000 KPIs they reported on down to a mere 30. This highlights that just because we have the ability to measure something, it doesn’t mean that we should. The first step to developing a measurement strategy that sidesteps the ‘one size fits all’ approach, is to define what success looks like and decide upon what metrics serve to measure this appropriately. Having this applied from the start and disseminating throughout an organisation and its partners (e.g. agencies) is a prerequisite for implementing the effectiveness culture.

The most successful organisations have a measurement strategy that adheres to a ‘hierarchy of metrics’, which is invariably topped by an overarching ambition for year on year profitable growth. The growing tendency to favour short term metrics is a product of their relative ease of measurement, combined with the difficulty faced when tracking the long term business value of a strong brand (e.g. value perception, price elasticity). This trend has become entrenched, with 70% of the survey sample agreeing that their main focus is reviewing and reporting on individual campaign or channel effectiveness. To return to the finance debate, the function is naturally fond of short term ROI but a robust measurement strategy must contextualise these short term metrics as serving the stages up to profitability growth, i.e. volume sales increase rather than YOY profitable growth itself. Metrics must be set as relative to the objective of the activity that it serves and how this delivers value to the hierarchy.


5.) Apply the 60/40 rule of thumb to brand building and brand activation

To close the day the ‘Godfathers of effectiveness’, Les Binet and Peter Field, took to the stage to present some of the latest findings from their new report ‘Effectiveness in Context’. Their previous research identified that the optimum budget split for sustaining relationships between customers of today and tomorrow was 60% for brand building (long term drivers of brand growth, e.g. brand ads, PR, sponsorship) and 40% for brand activation (triggers of short term sales uplifts, e.g. launch advertising, price promotions, PPC). Whilst the advisory split does differ according to various factors (e.g. sector, nature of purchase, ease of activation, level of product innovation), it still stands as a benchmark.

The crux of the matter is that without a strong brand, companies can’t remain agile when trying to enact positive change for growing market share. The award winning case study for the AA perfectly characterised this when, after completely cutting brand spend in favour of more ROI efficient activation which promoted initial discounts preceding renewal hikes, their market share was on the wain and collapse was predicted in five years. To avert impending catastrophe they shifted focus to wider reaching, brand building activity which revolved around the emotionally resonant ‘Singing Baby’ ad. After restoring the balance, in 2017 they finally regained market share in one year after 5 years of decline.

Their research shows that excessive short termism leads only to the erosion of long term brand health and diminishing returns for differentiation. In order to have this message of effectiveness heard internally, marketers first need to forge relations by speaking in a common language (i.e. less ‘marketing speak’) which facilitates a de-siloed culture of shared responsibility.