Measurement Challenges Within The Multi-Agency Ecosystem

Posted by Taylor Haney on Thu, Jul 25, 2013

A very insightful post from a #MITXData sponsor that we wanted to share with all of you. Manu Mathew, Co-Founder & CEO of VisualIQ provides a great perspective on how to be successful when a number of agencies and teams are responsible for your marketing strategy.

manu mathewManu Mathew is the co-founder and chief executive officer of Visual IQ. He is responsible for directing the company’s growth by expanding its client base to include Fortune 500 and Internet 1000 advertisers that face performance and optimization challenges inherent in multi-channel marketing. He is also responsible for expanding the capabilities of the company’s IQ Intelligence Suite of leading edge cross channel marketing attribution software products that help brands and agencies recognize opportunities for optimization hidden in their marketing performance data.

Brands rarely have all of their marketing channels managed under one roof. It’s more likely that some channels are managed in-house, while others are managed by one or more ad agencies. Depending on the number of channels, business units, geographic divisions and agencies involved, the result can be a measurement nightmare, whereby media optimization decisions are erroneously made based on misinformation or lack of understanding.

Consider the following example:

A brand engages with three different agencies: one for search, one for display and one for affiliate. Over a given time period, each channel takes the credit for 200 conversions based on a “last click” measurement methodology, for a total of 600 conversions. Yet the brand’s internal CRM system has recorded 625 conversions over the same period. So the additional 25 conversions are chalked up to “brand equity” — or conversions that were produced without the aid of any marketing initiative. The brand and its agencies go on to make their future media-buying decisions based on this information.

However, had the right centralized measurement methodology been in place, it would have been found that, in reality, 150 of the 625 conversion were created by brand equity, 75 were produced by affiliates, 300 were produced by display, and 100 were produced by search. So not only were the conversion figures based on last click measurement just plain wrong, they also contained significant duplication (counting a total of 600 conversions among them, when only 475 were actually produced). Obviously, brand strategists would make very different media-buying decisions — as well as assessments of their respective agencies’ performance — based on this more accurate set of metrics.

So What’s the Solution?
The solution is centralization of the measurement function. Whether it’s within the brand organization itself, within the brand’s agency of record, or via a contractor/consultant, there needs to be a single source of truth for holistic ecosystem measurement — preferably one without any “skin in the game” for the success of any channels it directly manages. This centralized resource would be responsible for implementing a measurement technology and putting a data collection/integration infrastructure in place, so that data coming from multiple agencies would be normalized to a common set of success metrics, de-duped and measured by fractionally attributed metrics, rather than last-click metrics.

Data-driven decision-making is hard enough, yet it can be even more challenging when the data lives across multiple internal functions and agency partners. Consider the options — in-house, contractor/consultant or a trusted centralized agency partner — but move toward centralization of the marketing measurement function with all due haste. Those who don’t are at a significant competitive disadvantage to those who are already on their way.