Measuring Success from Our Unique Vantage Point
Because Latinum works with nearly 100 distinct companies (and over 250 brands) from 13 industries, we have a unique understanding of the pitfalls and best practices of ROI measurement for a “market within a market.” We have boiled down the measurement difficulties and obstacles to a list of five ROI challenges for multicultural and millennial consumers.
But a list doesn’t solve the problem, so we also developed specific approaches to help our clients overcome the challenges. We have worked with the majority of our members to measure, compare, and better understand their marketing ROI with multicultural and millennial consumers.
Five Key ROI Challenges With Multicultural and Millennial Consumers
1. Overly Broad Independent Variable Data
National media data blurs out the local nuance that is so critical in multicultural marketing. Local data is generally only available quarterly, and cable ratings data are sometimes not available at the DMA level.
Latinum helps by working with data providers to build independent variable sets that are more representative of local market dynamics. We know where to find the data that will best surface local and consumer-level dynamics.
2. Overly Broad Dependent Variable Data
It’s easy to build a dependent variable (e.g., sales) for the “general market,” but what about when you need to understand the impact for a specific consumer segment? After all, millennial consumers don’t walk into a store with their “millennial” card. Some companies don’t even try; instead, they just leave Spanish or millennial-focused media in the model and see if it has a significant effect on overall sales.
At Latinum, we believe this isn’t adequate because companies will consistently underestimate spillover—the effect that non-targeted media has on sales for specific segments of interest. We work with our clients to build dependent variable sets that more accurately reflect the buying dynamics of their target consumers.
3. Black Box Methodologies
You might be able to compare ROI results done by the same vendor, but forget trying to compare results between them. This is a hard situation for multicultural marketers, who really need benchmarks of “what is good” when it comes to ROI.
At Latinum, we use the network to compare modeling results from multiple providers in a blinded manner—giving our members access to an ROI database of good, bad, and ugly marketing ROI results for hard-to-measure segments.
4. Inconsistent Metric Definition
Exactly what is “ROI”? This is a big problem for marketers. Does ROI include a valuation of the longer term components of return—the impact on brand equity? Is a “positive ROI campaign” one that pays for variable cost (lowest bar), one that pays for its variable and fixed costs, or one where the gross margin of the sold products pays for the variable and fixed costs (highest bar)?
Since 2012, Latinum has been collecting a list of all of the metrics used by our members, and we are working to bracket in a new “standard” metrics by industry. Our goal? Making sure that before our clients settle on a marketing ROI metric definition, they have transparency into its adoption across industries and the success rates of companies that have used it.
5. Higher Cost of Media
Because multicultural and millennial segments are “markets within a market,” prices are higher for a given volume of impressions. Additionally, many brands start with lower multicultural awareness and trial to begin with; they are working without the benefit of 20 years of advertising goodwill.
Latinum works with members to build a database of exactly how much more expensive media is for these critical segments—ensuring members don’t pay more than they need to for media.
We can work with your existing marketing analytics companies to optimize ROI measurement on a segment basis, we can estimate ROI ourselves using our data assets, or we can just put you in touch with other marketers to better understand their approaches. This is the beauty of working with us—we are totally flexible and work with your goals and constraints. Our only goal is getting you to profitable growth.