US Marketers Lack Faith in Companies' ROI Measurement

18 July 2006

In the latest survey carried out for America's Association of National Advertisers, fewer than half the 101 senior marketers interviewed were satisfied with their company's ability to effectively measure return on marketing investment.

Moreover, of those currently operating an ROI measurement program, only 36% involve their agencies - fearing a "fox in the henhouse" effect, the survey says.

The study, conducted by Marketing Management Analytics, was conducted between April and May of this year. It found that only one-third of respondents were satisfied with their ability to measure and act on ROI - although this is a major improvement on last year when a similar study found only 19% thus satisfied.

Twenty percent of those questioned reported rapid progress in developing ROI-measurement programs, although they have yet to complete the process. For the remaining 50%, accurate ROI measurement remains a distant dream.

Over 50% of the sample queried have a formal marketing-accountability system in place. For these to function effectively two elements are necessary, the study avers: Financial commitment and the cooperation of cross-functional teams.

Reports MMA chief operating officer Ed See: "We went to senior marketers to find out if they have a good grasp on return-on-investment measures, and to discover the characteristics necessary for good return-on-investment programs.

"The day and age when marketing departments make decisions in a vacuum is over," See added. "Members of a cross-functional team review materials and program elements and drive the use of an ROI program in a business cycle."

In implementing such programs, smaller companies can be just as successful as large ones; the important element is investment. "Companies can begin to be successful at about 1% of total marketing spend, and really take off at 2%."

Complete results from the survey will be revealed at the 2006 ANA Marketing Accountability Forum in New York later this week.

Data sourced from AdAge (USA); additional content by WARC staff