DAN e4m Conference: It is okay to measure KPIs, but let's not call it ROI: Virginia Sharma
Virginia Sharma, Director, Marketing Solutions, LinkedIn spells out how one should effectively measure their businesses ROI at the DAN-e4m Digital Advertising Conference
DAN (Dentsu Aegis Network) in collaboration with exchange4media unveiled the 4th edition of the Dentsu Aegis Network exchange4media Digital Advertising Report 2020 on January 23, 2020. Panel discussions and speaker sessions by prominent industry heads followed after the unveiling of the report. One of the special address at the Dentsu Aegis Network-Exchange4media Digital Advertising Conference was given by Virginia Sharma, Director, Marketing Solutions, LinkedIn on the topic: The Long and Short of ROI, wherein she shared how demonstrating long-term impact of digital on business growth can result in unlocking even bigger budgets for digital.
Starting off the session, Sharma said that most conversations are about ROI: "We interviewed about 4000 marketers in the world and the No.1 thing which is on their minds is ROI. And Click-Through-Rate and Cost-Per-Click are the top metrics that come to their mind when they think of ROI. In fact, most marketers are using CPC to measure lead generation. It is okay to measure KPI's but let's not call it ROI.”
— exchange4media group (@e4mtweets) January 23, 2020
The next takeaway from the session was that digital marketers are measuring ROI too quickly. "78 per cent of digital marketers in India are measuring their ROI in the first month of the campaign. Rarely, do they go back after three months or longer. Many of us have a sales cycle of six months and we are measuring faster than the sales cycle plays out. So if we are trying to correlate marketing investment with offering true value of the business, it's hard to connect the dots cause you have already moved on to the next campaign”, shared Sharma.
The third point she brought up was that as a community we need to support each other to have better conversations and help our marketers have the right conversations. Sharma stated, "When a marketer says you have to send me the CPC reports to send it to the boss, they are looking to measure ROI. Let's support them by really understanding how they can be successful with their boss and arm them with the right metrics for productive conversations."
Finally, she discussed how digital marketers are not motivated to actively share ROI metrics with stakeholders. Sharma further explains by saying, "About 40 per cent of the people even if they do get the metrics don't share it with their stakeholders. So why are they sitting on it? Why are they afraid to share forward? The issue is that about half of us are just talking to ourselves. 50 per cent of digital marketers are sharing the numbers within the marketing teams. Only 30 per cent are sharing with the salespeople and even less are sharing it with the CFO. It siloes marketing efforts and doesn’t integrate them with the business.”
What should we do with these insights on ROI? “You should continue to measure your marketing metrics long-term. Align the right metric with the customer journey – awareness, interest, consideration and action. It is about understanding the difference between ROI and KPI”, Sharma remarked.
Sharma concluded saying, “Let’s make our marketing matter. We need to change our reputation and relationship with our business.”
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