Is your marketing budget actually delivering a return?

Posted by Qamar Anwar, managing director of Legal Futures Associate First4Lawyers

Anwar: Research made for sobering reading

“Half the money I spend on advertising is wasted: the trouble is I don’t know which half.” Marketing pioneer John Wanamaker may have been forgiven for his lack of insight into his advertising budget back in the late 19th century, but what of today’s marketers? Surely in today’s data-driven age, accessing and utilising marketing budget data is commonplace?

First4Lawyers recently commissioned research company IRN to poll 100 SME consumer law firms – with turnovers ranging from less than £500,000 to more than £10m – to explore the current and future state of their marketing, in particular examining whether firms are future proofing their strategies and adapting to a changed marketing landscape. The results made for sobering reading in our new white paper.

In a world where there is a plentiful supply of data and information to aid marketing planning and decision making, it was quite shocking that so many respondents to the research are investing in marketing activities that they openly admit are neither important nor effective.

For example, while most of those surveyed are using print advertising and marketing, only 7% cited it as one of their most effective marketing tactics, and almost 40% said it was not an important one. Yet the legal sector has spent over £50m on print advertising over the last five years alone. It begs the question: Why?

Some of it is misplaced comfort with tried-and-trusted methods but the main reason is simply that many of those surveyed are not either monitoring the effectiveness of their marketing activity or are not doing it in a structured manner. Every firm will say how important word of mouth is, but do they actually track how much work they get that way? Very few do.

At the other end of the scale are marketing activities that respondents consider effective but then don’t really use. Social media ranked highly for perceived importance but fewer than half of firms are actually using it. Paid search activity was seen as the third most effective marketing tactic and almost 70% said it was an important or very important marketing activity. Yet only two in five marketers polled are actually using it.

This all suggests that they either are unsure about how to use these tactics or are actually fearful of them as routes to market. Or maybe it’s because when it comes to deciding how to spend the marketing budget, at two-thirds of the firms surveyed this was done at management or partnership level. But are they best placed to determine the evidence and strategy for such decisions?

You then wonder what the three out of four respondents who cite data insights and analytics as a marketing tactic that they use, are actually doing with the information they gather. Perhaps it is because only half of them perceive data as a very important part of their marketing strategy and a mere 2% ranked it as one of the most effective marketing tactics they use.

Indeed, half of respondents feel data analysis is either a fad or not important and will not change how they market. This is wrong-headed. Why use gut instinct when you have the facts and figures? Perhaps it is because 72% say they are not at all or only slightly prepared for how to use data metrics.

Data may not be perceived by many marketers to be interesting or exciting and is therefore overlooked in favour of more creative marketing activities. But if you haven’t got control of your data and analytics, how can you drive successful marketing? John Wanamaker didn’t have these tools to hand, today’s marketers don’t have that excuse.

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