Proxima Research: How To Fix the 60 Percent of Digital Budget Spent Ineffectively

Procurement outsourcing expert, Proxima, which describes itself as “the alternative to the conventional in-house procurement function” has produced some outstanding research and thought-leadership reports, like the Corporate Virtualization report, which we featured extensively last year. Very recently it conducted research into how companies globally manage, and receive value from, their digital marketing spend. So that includes the channels to reach the customer, like mobile phones, social media marketing, display advertising, search engine marketing, and digital marketing itself like search engine optimisation, mobile apps, online newspapers and video-on-demand services. This kind of marketing approach requires an indepth understanding of customer behaviour and an ability to analyse and quantify value derived.

In its latest report based on the outcome of its research, The Digital Disconnect, Proxima reveals that this year spend has not aligned with the value that companies expected. Given that 50 percent of total advertising budgets in the UK (totalling around £7.9 billion) and around 30 percent in the US (around £32.9 billion) are being spent on digital marketing, that’s a lot of budget potentially wasted owing to commercial mismanagement of the spend and brand and commercial material not reaching the right audience.

Latest research tells us that about 35 percent of all web activity is fraudulent or artificial and 54 percent of online ads are not even being seen by a human. There is a real lack of transparency over this, so it is extremely difficult to correlate ROI in digital marketing back to direct commercial outcomes, as Proxima has reported. You might also like to read “Ad Fraud — Robots Are Stealing Billions from Digital Marketing Procurement Budgets,” which we reported on last year.

Proxima’s report says “Companies need to understand how to better buy digital marketing tools and channels, how to work with third-party media networks and ultimately manage the digital marketing budget better. The involvement of procurement can help marketing leaders highlight the effectiveness (ROI) for each channel and component of digital marketing investment.” So, how do we get around this lack of transparency? How do we get more control over this massive misdirection of spend (estimated at £37 billion this year)? How can procurement lead on marketing strategy aligned with true commercial outcomes?

A webinar on Tuesday 28th July will tackle all of these issues. Mark Simester, Marketing Director at Warburtons; Emma Robertson, Managing Director at Transform UK; and John Butcher, Digital Marketing Specialist at Proxima will explore the current state of digital marketing and discuss the findings of the research. They will be giving some valuable insight into how the problems can be solved and will give some key takeaways on how to reconnect digital spend back with business expectations.

You can register here http://insight.proximagroup.com/digital-marketing-webinar to join the discussion.

And you can find essential reading and key findings in this Proxima infographic:

the digital disconnect infographic

 

 

 

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