A study published today (June 20) asserts that better allocation of marketing spend could result in approximately $45bn more profit globally for brands each year.
Ebiquity came to the conclusion after analyzing the “profit impact” of 2,500 ad campaigns (representing $375bn in media spend) over three years in a bid to better understand how marketers can optimize their ad campaigns, plus demonstrate how their ad spend helps their organization generate revenue.
The findings of the study claim that had the same spend – representing approximately 76% of the total advertising market – been better optimized based on the ROI contributions of each channel, it would have generated an extra $45bn in global profits for brands.
Mike Campbell, Ebiquity, head of international effectiveness, said a better use of measurement and analytics, can help marketers reevaluate their budget allocation and subsequently produce dramatically better results.
Michael Karg, Ebiquity, chief executive officer, added: “As media, content, and customer experience options proliferate, brands fundamentally need to know what works well for them and what doesn’t. This study is an important reminder that marketing spend still has a positive bottom-line impact and should be treated as an investment, not as a cost.”
Those channels assessed in the study include TV, radio, press, out-of-home (OOH), plus digital display, and video, including broadcaster video on demand (VOD) plus streaming outlets such as YouTube, but excludes search info – representing roughly half of all digital spend.
Marketers are under increasing pressure to demonstrate the ROI of their ad spend, as procurement departments increasingly push the agenda of budget optimization through methods such as zero-based budgeting, with vendors in the sector eager to satisfy this growing demand.
Earlier this week, Adobe kicked off its promotional activity with the unveiling of an attribution tool dubbed Attribution IQ that it can help marketers better discern where to focus their marketing interventions, such as paid-for media, email pushes, thus reducing their reliance on first- and last-click attribution models.