Businesses can unlock 10x return on adspends by measuring marketing right

Boston Consulting Group (BCG), in collaboration with Meta, has launched a report titled, “Measure To Grow: Drive double-digit growth by measuring marketing right”, which brings together for the first time in India, an industry consensus on optimal marketing measurement for marketing spends. The study provides a comprehensive view on the best-in-class marketing measurement practices that can unlock exponential business growth for businesses, small and large.

For the purpose of this study, BCG and Meta collaborated with leading marketing measurement specialists, including Adobe, Analytic Edge, AppsFlyer, Cartesian Consulting, Nielsen, and RainMan Consulting as well as 18 digital-first organisations from India across five key industries (Financial Services, EdTech, E-commerce, Travel, Media/OTT) to present this view.

Key Highlights:

Digital is the new mainstream:

• 3x increase in share in the last five years
• 12% to 34% jump in share of digital in total marketing budget in less than five years
• Digital fastest growing marketing channel in India; soon to overtake TV

Strategic Measurement Can Unlock:

• 60% sales uplift
• 10x return on ad spends
• 25% increase in gross margin

Inadequate measurement leaves significant value on table:

• ~65% higher cost of acquisition due to poor measurement
• 70%+ are still under-investing in measurement capabilities
• Only 5% of organisations have quality data that can enable key business decisions

The report findings highlight that there has been a 3x increase in the share of digital marketing spends over the last five years by India Inc. However, despite its significant growth, the measurement practices have not kept pace. As a result, organisations are leaving significant value on the table.

“Measurement in India is largely at a nascent stage, and most organisations are still in the early stages of the journey,” said Shaveen Garg, Managing Director and Partner, BCG. “While there do exist pockets of measurement excellence across industries, a lot of ground remains to be covered before organisations can accelerate their measurement journey to unlock unlimited potential and growth within the purview of digital marketing.”

Pratham Hegde, Director and Head of Measurement at Facebook India, added here, “Digital is the new mainstream, and in order to unlock growth, there is a growing need for businesses to measure the true impact of marketing on business outcomes. The industry consensus is that there is no single measurement method or metric that will address all measurement requirements. The core recommendation for advertisers is to have an incrementality based approach at the centre of their measurement philosophy.”

“Organisations today need to make multiple marketing decisions – defining media mix, budget allocation, campaign optimizations…However, in a complex measurement ecosystem, with multiple stakeholders (app measurement, web analytics, platform-driven campaign performance reports…), with divergent recommendations, they often find it difficult to identify the right measurement approach,” said Pallavi Malani, Managing Director and Partner, BCG.

She further added, “Our studies show that while leading global companies are significantly ahead on the measurement journeys (deploying Marketing mix models and statistical Multi-touch-attribution), most Indian organisations have just started their journeys towards measurement maturity – with encouraging, yet limited, pockets of measurement excellence, primarily in financial services, eCommerce, Education technology and media.”