Since the very beginning of the modern marketing era, one attribute of the process of connecting with potential consumers has been the uncertainty about the effectiveness of advertising. The questioning was supported by the fact that most advertising campaigns were the result of a “mud against the wall” process where advertising dollars were directed at radio, print and perhaps even television without really knowing if the intended target of the ads would be listening. Al Ries, author of “The 22 Immutable Laws of Marketing” says, “More money is wasted in marketing than in any other human activity (outside of government activities, of course).”
The digital communication era of social media platforms, text messaging, and personalized emails have revolutionized the rules of the ad game and greatly diminished the inability of advertisers to determine the effectiveness of marketing and advertising spend. The ability to measure and analyze the worthiness of marketing campaigns has changed marketing dramatically. Digital marketing’s ability to offer some expanded insights, based on performance data, has brought marketers a much-improved ability to determine the success or failure of digital promotional efforts. But as total global advertising spend is projected to reach $793 billion by the end of this year, most marketing experts are still unable to fix the amount of marketing budgets that are being wasted.
In a survey by Rakuten Marketing, respondents estimated they waste an average of 26% of budgets on ineffective channels and strategies. While markedly improved over past experiences, this high cost of waste is compelling even the most modest of businesses to refocus efforts to better understand and optimize a brand’s overall marketing effort. So how can businesses minimize the amount of wasted marketing spend?
Developing a comprehensive marketing strategy that is built around a well-defined goal and a budget with specific and objective priorities is critical to optimizing a return on investment. There is never a time to be wasteful with resources regardless of a company’s position in a business lifecycle. The budget should be flexible to permit ongoing adjustments to original assumptions and take advantage of changes in consumer behaviors and unforeseen social and geopolitical dynamics.
It has been said that “You cannot grow what you do not know”. Establish a comprehensive system of measurements to ascertain the effectiveness of every campaign and revisit original assumptions and adapt each campaign to optimize its performance. With the massive shift to digital advertising and social media channels, the space is getting noisy and crowded and many inexperienced ad players can find it challenging to understand the inner workings of the new medium.
Not every social media channel is the same by design. Identify those channels where your targeted consumer is listening and allocate spending across multiple channels. Focus on creating the right message at the right time and target that message to the right customer. Constantly evaluate and measure the results of each campaign to determine the level of success and be open to adapting and changing an approach. Nothing is forever, even the newest digital technology. Savvy consumers are agile and mobile not only in a physical sense but where they are residing and listening. Don’t get left out of the conversation because you failed to realize your best customer has left the room.
The familiar adage, “waste not, want not”, was first coined by Maria Edgeworth in the work “The Parent’s Assistant” in 1800. It has been frequently repeated and quoted to advance the idea that it is best to use one’s economic resources wisely because such resources are not generally infinite. Once spent, wisely or squandered, it’s gone.