Is Your Digital Marketing Working? How Can You know?

How successful was your last digital marketing campaign? How do you know?


If you invest in paid search or display ads, you're inundated with an incredible amount of metrics. Everything from Conversions, Clicks, and Impressions, to what devices are viewing your ads and even the time of day people are seeing them.


This all looks very impressive and it’s easy to feel that everything’s going great. Money well spent. But is it? Despite all the amazing graphs, pie charts, and tables provided, it doesn’t paint a true picture of your digital marketing ROI.


Whether your digital campaign is meant to increase website traffic, sell a product/service, or increase engagement, clicks and conversions don’t tell the entire story.


Why? If impressions, clicks, and conversions aren’t the indicator of ROI, then what is?


The reason: a vital piece of information is missing. It’s difficult to determine the level of success (or lack thereof) by examining the digital campaign metrics alone.


This is because you don’t know what your site traffic WOULD have been without digital marketing. For example, perhaps your site would’ve received 40-60% of the clicks and/or conversions had you not run a campaign at all.


Can you be certain you’re not paying for the success that you would’ve had without any digital marketing? As Bobby Axelrod on SHOWTIME’s Billions would say, “What is your level of certainty?”

The ability to accurately forecast your web traffic is critical in determining the success of any type of digital marketing campaign.


Yes, it’s possible to look at the traffic from the same time last year or last month in relation to the current traffic with the digital marketing for a quick comparison. But this method is wildly inaccurate compared to building a predictive model based on years of daily traffic for example.


Flashlight’s Method:


Whether your goal is to increase traffic, sell a product/service, or encourage engagement, an accurate predictive model will compare the projected traffic to the actual results. This enables us to truly measure your digital marketing ROI.


We do this by taking all your historical data and building the predictive model using a combination of techniques (i.e. ARIMA, exponential smoothing, etc.), while accounting for seasonality and holidays to ensure accuracy. Before relying on the predictive model, we test it against a control group to ensure its effectiveness.


For Example:


Testing Model Accuracy - Control Group

For the model to be deemed “accurate”, the predicted traffic must be within the “Upper” & “Lower” range. The closer the predicted is to the actual in the control group, the more accurate the predictive model. Ideally, this upper & lower range would be much narrower. The wide range is due to limitations in the data (i.e. low daily traffic & less than ideal historical data).


However, the mean absolute percentage error (MAPE) for this model is 28.7%, despite the data limitations. Industry standard for an acceptable MAPE is roughly 30%, so the model proves to be very good and passes the accuracy test.


Now that we know the model is effective at predicting website traffic, we can compare what the traffic would’ve been without a digital marketing campaign to that of the actual traffic with the campaign.



Digital Marketing Evaluation - Actual vs Predicted

There were two digital marketing campaigns:

  • AdWords Only – March 1st until June 1st in 2018

  • AdWords + Display – July 1st until August 1st in 2018

The "AdWords Only" campaign produced an average traffic increase of 150% over the predicted. Whereas the "AdWords + Display" resulted in an average increase of almost 300% the predicted traffic. The addition of display adds to the digital marketing campaign had the largest impact on increasing traffic to the site.


After comparing the actual with the predicted, one can accurately measure the digital marketing ROI. By cross-referencing the marketing spend with the predictive model, it's quite easy to determine the level of success and ROI.


This also gives you the ability to compare the performance of various marketing campaigns to see which one provided the best results for your business.


Contact us and discover how Flashlight can help your business measure marketing ROI.

Your resources are too valuable to waste.