Market Share and ROI: The Language of Effectiveness for 2024

Understanding and effectively utilizing key metrics like market share and ROI is crucial for driving success in the rapidly changing marketing landscape. At Rizzo Young Marketing, these metrics form the foundation of effective marketing strategies, helping businesses achieve their goals in a competitive market.

As we move into 2024, let's examine the significance of market share and ROI and how balancing these metrics can lead to long-term success.

Growing Frustration Surrounding Marketing Effectiveness

Marketing effectiveness has come a long way in recent years, with best practices better defined than ever. However, data from Marketing Week’s 2024 Language of Effectiveness research in partnership with Kantar suggests that progress may have come to a grinding halt. Although most marketers agree there has been a greater focus on effectiveness within their organizations over the past three years, less than half believe their business’s senior leadership understands the need for both short- and long-term effectiveness.

Disconnect Between Marketing and Leadership

There is a concerning disconnect between marketing teams and their business leadership. Only a minority of marketers are confident in their ability to measure effectiveness. This gap highlights the importance of establishing commercial credibility for marketing within organizations. For instance, Pete Markey, CMO of Boots UK, emphasizes the need for measurement: “I don’t think you can be a marketer today without a focus on measurement.”

Building Frustration and the Need for Open Communication

Markey also acknowledges marketers’ frustration when their leadership lacks an understanding of effectiveness. To bridge this gap, marketers must develop a narrative that aligns with business goals and demonstrates the value of both short—and long-term marketing activities. Establishing strong relationships with finance teams and adopting open-book accounting can help improve transparency and understanding.

Marketers Develop Better Analytics for Creative Effectiveness

The creative effectiveness agenda is moving in a more positive direction. The proportion of marketers performing some analysis to measure creative effectiveness has increased significantly since 2023. Myers at The Very Group and Markey at Boots agree that measuring creativity is as important as measuring media.

Importance of Creative Quality

Creative quality is one of the critical drivers of overall marketing effectiveness. Despite this, some marketers report a decreased focus on creative quality due to the rise of performance marketing. Shelley Macintyre, CMO of Allplants, cautions that this trend could lead to a “race to the bottom” on creativity. Instead, she advocates for finding a “creative unlock” to drive better performance throughout the marketing funnel.

Impact of Third-Party Cookie Phase-Out

With the phasing out of third-party cookies, the value of creativity is set to grow. Marketers must focus on creative testing to unlock immediate ROI and communicate more effectively. This approach can provide important insights into optimizing marketing messages and driving engagement.

Marketers Begin Exploratory Phase with Artificial Intelligence (AI)

Artificial intelligence (AI) and machine learning have the potential to revolutionize marketing effectiveness. However, most organizations are tentatively approaching technology. Lack of knowledge, time, or dedicated resources are among the barriers preventing marketing teams from fully embracing AI.

AI Adoption in Marketing

According to the survey, AI is most commonly used in market research, producing multiple variants of campaign assets, and optimizing creative mid-campaign. Businesses that are currently outperforming the market are more likely to use AI in every area of marketing effectiveness. For instance, The Very Group uses AI to optimize media and creativity, from digital real-time bidding to customer behavior prediction.

Encouraging AI Exploration

Despite the tentative approach, marketers must explore AI to drive effectiveness. Myers at The Very Group emphasizes the importance of innovation and upskilling to stay caught up. AI should be integrated thoughtfully, focusing on the areas with the most significant impact.

Brand Building and Client Budget Cuts Conflict

Marketers believe brand building is their surest ticket to success, with brand advertising considered the most critical tactic for driving growth. However, a glaring contradiction exists as almost a third of respondents report budget cuts. This disparity raises questions about the tools marketers have to prove the necessity of long-term investment in brand marketing.

Balancing Short- and Long-Term Investments

Achieving a balance between short—and long-term investments is crucial. Jessica Myers of The Very Group stresses that a strong brand drives both long-term and short-term growth. Marketers must carefully consider how to achieve immediate sales targets while ensuring sufficient brand-building for future growth.

Short-Term Pressures and Performance Channels

The abundance of performance media channels creates additional pressure to prioritize short-term investment. Pete Markey of Boots warns that overreliance on performance channels can erode the top of the marketing funnel over time. Understanding how brand-focused and performance channels work together is essential for sustainable growth.

Redefining and Proving Return on Investment (ROI)

Return on investment (ROI) has consistently emerged as a source of confusion and needs more attention from marketers. The Language of Effectiveness survey reveals that there is no one gold standard for defining ROI among marketers. This lack of alignment underscores the need for marketers to educate their leadership on the appropriate measurement frameworks.

Defining ROI in Context

Different businesses require different ROI models. For example, Checkout.com’s marketing team measures brand recognition annually and short-term pipeline impact, considering their sales cycle can last over a year. This approach ensures that ROI measurements align with the company’s commercial KPIs.

Proving ROI for Increased Investment

At Boots, ROI is a top priority, with the marketing team measuring long-term and short-term returns. Demonstrating ROI has enabled Boots to secure increased marketing budgets and drive continuous growth. Markey highlights the importance of proving ROI to secure further investment and grow the business.

Navigate the Path to Marketing Effectiveness with Rizzo Young

Establishing marketing effectiveness as a core pillar of growth and profitability requires consistent effort and strategic alignment. Marketers must bridge the gap between short- and long-term effectiveness, leverage creative quality, explore AI, and balance growth priorities with budget constraints. At Rizzo Young Marketing, we are committed to helping our clients navigate these challenges and achieve their marketing goals.

Businesses can drive success in a competitive landscape by understanding and effectively utilizing key metrics like market share and ROI. Whether you want to grow your market share, optimize your ROI, or both, our expertise can help you navigate the complexities of the modern marketing environment.

For more insights and assistance with your digital marketing strategy, contact the advertising and branding specialists at Rizzo Young Marketing.