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Abstract
Measuring online marketing effectiveness has become a key issue as marketers demand more evidence of the impact of their campaigns. However, their needs are currently only being partially met. This paper looks at the important, but hitherto under-developed role market research has to play in this area.
The role of advertising and online marketing in the sales process Traditional TV and print advertising media can really only hope to create awareness and push consumers to identify new needs. From then on other elements of the promotional mix take over such as direct marketing and pointof sale promotions. The measurement of each element of the campaign can be focused on the part of the process that is being addressed. For example consumer research into brand awareness and attitudes is highly developed within the TV arena.
Unlike traditional media, the Internet encompasses the entire `sales' process. For this reason I have used the term `marketing' rather than `advertising' because the Internet is so much more than an advertising medium. Marketing campaigns can create awareness then drive consumers all the way through the process to actually making a purchase online. The crucial difference is that the Internet is a distribution channel for products and services not just a communication channel.
What then should be measured in order to determine the effectiveness of an online marketing strategy? It is vital that online marketers (just as with any other medium) develop campaigns that have clear objectives and the metrics chosen must reflect these objectives. For example, if the campaign is trying to sell mobile phones online, then the basic measure must be an analysis of the number of mobiles sold against the marketing spend, i.e. return on investment.
Existing online marketing metrics
Existing measures of online marketing effectiveness include:
Click-through rates (CTR);
Cost per click (CPC);
Cost per impression (CPI);
Return on Investment (ROI).
These existing metrics are all numerical in nature and `data heavy'. The Internet is quite similar to direct marketing in that consumers' actions are all measurable and recordable, and this has led to an emphasis on data capture. Examples of...