Digital media have rightly been called ‘the most measurable ever’. Never before has marketing been so measurable or accountable. This gives us a great opportunity to forecast business outcomes from our investments in marketing activities which helps communicate our targets more confidently and gives us and our colleagues more confidence.
But this is only the theory. In practice, we can miss out on forecasting for all sorts of reasons. Lack of time and lack of skills (either in your business or your agency) are the obvious culprits. If inertia stops forecasting, you are missing out on all of these benefits.
1. Targets are essential for planning. Forecasting is a key part of the process for creating different types of marketing plans, both for annual investment and for individual campaigns. Creating more accurate forecasts for digital marketing is now essential with the growth of digital marketing which now accounts for an ever-increasing proportion of spend and the results delivered from marketing activities.
2. Targets can be based on audience behaviour. Digital media give us new information sources about the number of people searching, visiting websites or sharing on social media. So, it’s useful to exploit these tools so that we can compare our performance with other businesses in our sector to check that we are exploiting the online opportunity. Clickthrough Marketing harness insight like keyword search volumes in our regular customer reviews and when pitching to show the gap or opportunity that can be exploited through more effective search marketing.
3. Best and worse case estimates can be defined. Most would agree that forecasts are better than no forecasts, particularly if they are based on the best quality information available. But, whatever the quality of the data, the forecast will only be an estimate. So, we recommend including best and worst case estimates of uplift in your digital marketing forecasts. This can be based on different estimates of increase in conversion rate from AB testing for example. Although optimisation through AB testing should give an uplift, the precise uplift won’t be known in advance.
4. Realistic targets are motivating. If an individual or team has a target, this makes an activity more purposeful and it can be a shared goal that everyone works towards. Targets are a lot less motivating, in fact, incredibly de-motivating if they are ‘stretch targets’ which are plucked out of the air by managers who don’t have a clue about whether they are achievable since the targets are not based on evidence.
5. You can have more confidence in your targets and adjust them as needed. A good personal reason for creating better forecasts is that you can have more confidence in what you’re looking to achieve and you can explain to colleagues what the forecasts are based on, which should give them more confidence in you.
You can also improve your forecasting with experience through time, so forecasting works better for everyone.