BCA

Marketing budgets are starting to rise in the US, but changing consumer habits and preferences mean new processes are required to measure return on investment accurately.

In a survey of leading executives conducted in February this year, Forrester, the research firm, found that 37% of participants were planning to boost their spending levels this year. A further 35% of the sample expected to maintain their communications expenditure in line with 2009, while 27% had experienced a reduction in funding over the same period.

More broadly, Forrester suggested that the main challenge facing brand owners at present was not determining their overall adspend levels, but allocating resources in the most effective way.

Increased collaboration is necessary

The shift to digital platforms and other types of emerging technology is also requiring increased collaboration between marketing, IT, and finance departments. As such, companies need to ensure they invest in the latest tools allowing for “media mix optimization” to replace out-dated systems which were put in place prior to the digital age, Forrester said. Procter and Gamble, General Mills, and other FMCG manufacturers originally pioneered this approach, which then spread to almost every major product category during the last decade.

However, the explosion of social media and the rise of mobile devices such as smartphones had provided another major “input” which now must be considered. More specifically, one key metric which should be attracting the attention of marketers is Customer Lifetime Value, or the revenues generated over the typical duration of a brand’s relationship with an individual customer. This is often separate from a customer’s Brand Value, as typically ascertained by a range of more traditional metrics.

While the advent of new software should allow more accurate tracking in all of these areas, it is incumbent on industry professionals to ensure they drive this success.

“The idea of doing more with less is now a long-term business strategy versus a short-term mandate.” according to Chad Mitchell, an analyst at Forrester.

From World Advertising Research Center

From eMarketer.com

Quantifying returns needs most improvement

 Mobile is at least somewhat important to the strategy of more than three-quarters of marketers in North America, according to a January 2010 survey by R2integrated. But barriers to mobile campaigns remain.

The greatest obstacle, the survey found, was difficulty in developing the business case for mobile campaigns, followed by inability to measure ROI and a lack of a mobile component to the strategic marketing road map.

Asked what the most critical area of improvement was in mobile, 43% of respondents said quantifying ROI—the top response.

Awareness and leads are key goals

Respondents said the main goals of their mobile campaigns were raising company awareness and generating leads. To that end, marketers were most likely to measure their success by an increase in customers or sales.

“It appears that 2010 will be a year of experimentation and education on mobile marketing as marketers struggle to come to terms with its practicality and ROI,” said Matt Goddard, co-founder and CEO of R2integrated, in a statement. “This shouldn’t suggest that marketers ought to table their mobile marketing plans, but that they should pay considerable attention to how they can connect the dots back to driving revenue.”

Mobile website development important focus

Most respondents reported that they would spend less than 15% of their budgets over the next year on mobile, though about one-quarter would spend between 15% and 30%. More than one-half were focused on mobile Website development, while 40% used apps for their campaigns.

The marketers surveyed considered iPhone and BlackBerry the most important platform for mobile development. Consumers may be warming up to Android, but only 7% of respondents to the R2integrated survey thought it was “very important.”

To see complete data charts, go to emarketer.com. Printed with permission of eMarketer.