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Tracking Local Marketing ROI Challenges National Brands

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Nearly two-thirds (66.2%) of national brands invest in local marketing (i.e., they conduct marketing campaigns directed at customers in their local markets) but only 42.0% measure the return on investment (ROI) of such efforts, according to a new study by Balihoo.

By contrast, some 56% of surveyed national brands track the ROI of their national marketing campaigns:

Below, additional findings from Balihoo's Micro Study: National Brand Use of Local Marketing and ROI Metrics.

Connections Between Budget and Tracking ROI


Roughly one in five (21%) national brands invest more than 25% of their total marketing budget on local marketing, though a plurality (29%) invest 1-5% of their total spend on local efforts. 

Among all brands that invest in local marketing, 25% report they are "not able to track ROI at the local level."

However, brands that invest more in local marketing tend to have stronger measuring capabilities.
 
For example, among those that invest 25% or more of their budget on local marketing, only 8.7% report they are not able to track the ROI of local marketing. By contrast, 39% of national brands that spend less than 5% on local marketing aren't able to track local marketing ROI.

Expectations for Local Marketing Performance
 
Among the brands that track campaign ROI, a plurality (44%) expect local and national campaigns to perform equally; however, 37% expect local campaigns to be more effective than national ones.

Only 19% of brands that track campaign ROI expect local campaigns to be less effective than national ones.

Similarly, among the brands that track the ROI of their local and national campaigns: 

  • 24% expect national marketing campaigns to generate an ROI of 4:1 or higher.
  • 36% expect local marketing campaigns to generate an ROI of 4:1 of higher. 

Other key findings: 

  • Bigger companies invest more in local markets: Larger national brands (those with annual revenues of $1 billion or more) are 49% more likely than smaller national brands ($100-250 million in revenue) to invest in local marketing.
  • Top marketing challenges: Among national brands, the top 3 marketing challenges for 2012 are lack of marketing budget (39.7%), measurement and metrics (38.6%), and lead generation (31.4%).
  • Top information sources: When looking for marketing knowledge, brands turn to industry research most (57.7%), followed by marketing and ad publications (48.2%) and national industry organizations (37.9%). 

About the data: Findings are based on a survey of 273 US-based national brands, fielded online in March and April 2012. Respondents met the criteria of marketing professional, from companies with annual revenues of $100 million and higher.


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