Measuring Marketing Spend: My short learning curve to unlocking ROI for Growth
As someone who has spent two decades in marketing, I've watched the industry evolve from intuition‑driven campaigns to highly automated, data‑rich ecosystems. One thing hasn’t changed:
Marketing budgets are still often treated as sunk cost rather than a revenue generator
In the era of digital transformation, where every click and conversation leaves a data trail, failing to measure the return on your marketing spend means flying blind. Research shows that 73 % of marketers can’t properly demonstrate return on investment (ROI) - yet those who can measure it enjoy 20 % higher marketing efficiency year after year.
In big organisations as a developing marketing leader you are aware at a topline level of what is important to measure in terms of KPI’s but rarely do you appreciate that this is the unlock to becoming truly valuable to your brand team.
This article distils my rapidly learnt experience after leaving Nike and working across other organisations, along with some of the latest best practices into a practical framework that my network has shared with me to build something robust in a measurement culture, to optimise spending, and drive sustainable growth.
Why Measurement Matters More Than Ever
Marketing used to be built around gut feel. When I started my career, we mailed brochures and booked newspaper adverts, trusting that sales would somehow follow. Those days are long gone. Today’s customer journey spans digital ads, social media, search, email, influencers and offline experiences. With tighter budgets and increasing accountability, leaders demand evidence that each pound invested returns measurable revenue. HubSpot’s recent research highlights that most marketing teams still struggle to prove ROI.
This lack of visibility often leads to waste: campaigns remain active long after their performance has plateaued, and low‑performing channels continue to drain resources because nobody has the data to challenge them.
If you can’t measure it, you can’t improve it. A data‑driven approach helps you allocate budget to the channels and messages that actually work, while cutting back on those that don’t. Over time, this leads to compounded efficiency gains, freeing up funds for innovation, testing, or expansion into new markets.
Defining Marketing ROI and ROMI
Before diving into measurement techniques, let’s agree on terms. Marketing ROI measures the financial return generated by marketing activities. A simple formula compares the uplift in sales to the cost of marketing:
ROI = (Sales Growth − Marketing Cost) ÷ Marketing Cost
However, this basic calculation assumes that all sales growth is due to marketing. In reality, you may experience organic growth from improved product quality, seasonal demand, or word‑of‑mouth. To account for this, use an adjusted formula
Adjusted ROI = (Sales Growth − Organic Sales Growth − Marketing Cost) ÷ Marketing Cost
Subtracting organic growth gives a clearer picture of how much revenue your campaigns truly create. It also frames the conversation differently. Rather than asking “How many sales did we make?” you’re asking “What is the incremental value of our marketing?”
ROMI vs. ROI
You may see both Return on Marketing Investment (ROMI) and ROI used interchangeably. ROMI focuses specifically on marketing spend rather than total business investment. In my practice, I prefer ROMI because it forces teams to focus on variables they can control - creative, media spend, and targeting - while isolating marketing’s contribution. Whether you call it ROI or ROMI, the methodology remains the same: isolate incremental sales, deduct costs, and express the remainder relative to spend.
From Vanity Metrics to Real Outcomes
Many campaigns still prioritise vanity metrics such as likes, impressions and follower counts. While helpful for gauging awareness, these indicators rarely correlate directly with revenue. When budgets are under scrutiny, telling your CFO that a video achieved 200,000 views does little to secure more investment. Instead, shift your focus to performance metrics that map to each stage of the funnel:
Awareness: brand lift surveys, reach, ad recall. These tell you whether your message is getting noticed.
Consideration: click‑through rates (CTR), website engagement, time on site. These indicate interest and intent.
Conversion: cost per acquisition (CPA), conversion rate, average order value. These measure whether your marketing actually drives purchases.
Loyalty: customer lifetime value (CLV), repeat purchase rate, Net Promoter Score (NPS). These show whether you’re building long‑term relationships and brand advocacy.
By tying metrics to funnel stages, you create a narrative that shows how brand exposure leads to consideration, conversions and repeat business. This narrative is far more persuasive when negotiating budgets and priorities with senior stakeholders.
Incrementality and Attribution: Understanding the True Drivers
One of the biggest challenges marketers face is determining which channel deserves credit for a sale. In the omnichannel landscape, people interact with your brand across multiple touchpoints-search ads, social media posts, email sequences, store visits and more. It typically takes 6–10 touchpoints before a consumer decides to buy. Relying on the last click to allocate all credit is misleading because earlier exposures also shaped the decision.
Incrementality Testing
To understand the incremental impact of marketing efforts, many advanced teams use incrementality testing or marketing mix modelling (MMM). Incrementality testing involves running controlled experiments - often geo‑split or time‑split tests - where you withhold ads in some markets or periods and compare the sales differences. This reveals the true lift generated by a campaign. For smaller businesses without large budgets, you can perform simpler A/B tests by temporarily pausing channels and monitoring the effect on sales.
Multi‑Touch Attribution
Another approach is multi‑touch attribution (MTA), which assigns fractional credit to each touchpoint based on its influence. MTA models vary (first‑touch, linear, time decay, position based, algorithmic) but the principle remains: credit is shared across interactions rather than captured solely by the first or last click. However, MTA struggles to measure offline channels and may be complicated by privacy restrictions. A hybrid approach combining MMM for high‑level insights with MTA for digital channels often provides the best of both worlds.
Why UK Marketers Need Robust Attribution
Marketing in the UK presents unique challenges. Data protection regulations like GDPR limit tracking cookies and user‑level data. Meanwhile, multiple media channels - from digital out‑of‑home to TV sponsorships - make it harder to assign credit. By embracing incrementality testing and carefully designed attribution models, you build a measurement system that respects privacy and still reveals what works. Remember: the goal isn’t to achieve perfect precision but to get a directionally accurate sense of which channels and messages drive revenue.
Setting Up Your Measurement Framework
Building a measurement culture takes planning. Start by identifying what success looks like and align your team around a few critical outcomes. Then choose metrics and methodologies that reveal progress towards those outcomes. Here’s a basic framework you can adapt:
1. Set Clear Objectives
Tie your marketing goals directly to business objectives. For example, if your business aims to grow revenue by 15 % this year, your marketing goal might be to generate £1 million of incremental revenue through paid media. Defining a precise target allows for meaningful measurement and prevents scope creep.
2. Choose Metrics by Funnel Stage
Use metrics that reflect what you’re trying to achieve at each stage. Here’s a quick reference table:
Funnel Stage Example metrics Awareness Reach, ad recall, brand lift surveys Consideration Click‑through rate, engagement rate, time on site Conversion Cost per acquisition, conversion rate, average order value Loyalty Customer lifetime value, repeat purchase rate, Net Promoter Score
| Funnel Stage | Example Metrics |
|---|---|
| Awareness | Reach, ad recall, brand lift surveys |
| Consideration | Click-through rate, engagement rate, time on site |
| Conversion | Cost per acquisition, conversion rate, average order value |
| Loyalty | Customer lifetime value, repeat purchase rate, Net Promoter Score |
This table provides a starter toolkit. Adapt the metrics to your product type and sales cycle. For high‑ticket B2B purchases, look at lead quality and pipeline progression; for retail brands, focus on basket size and customer retention.
3. Instrument Your Data Collection
Implement tracking for each channel. Use UTM parameters on links, ensure conversion events are properly configured in your analytics platform, and integrate your CRM with your marketing tools. Where cookies are restricted, leverage aggregated data sources and invest in server‑side tracking or privacy‑compliant analytics.
4. Establish Baselines and Benchmarks
Before launching new campaigns, measure current performance. This baseline acts as your control group. For instance, track organic sales for several weeks to estimate natural growth. Baselines also help calibrate your expectations; when you see a lift, you know it’s due to marketing rather than seasonality or external events.
5. Run Tests and Iterate
Design experiments to test hypotheses - A/B testing creative, exploring new audiences, or shifting budget from one channel to another. Keep experiments focused and run them long enough to get statistically significant results. Share findings across the organisation to build a learning culture.
Calculating ROI and Setting Benchmarks
Once you have data in place, calculating ROI becomes more straightforward. Use the adjusted ROI formula outlined earlier. Be sure to incorporate overhead costs, such as agency fees, creative development and personnel, to get a true picture of profitability. Many marketers inadvertently inflate ROI by ignoring these expenses.
A common question is: what constitutes a good ROI?
According to marketing researchers, a 5:1 revenue‑to‑spend ratio is generally considered strong.
And if you’re looking at 10:1 or higher that is exceptional.
Anything below 2:1 often means you’re only breaking even after production costs.
These benchmarks aren’t one‑size‑fits‑all; margins, product life cycles and industry norms influence what’s realistic. High‑margin software businesses might achieve double‑digit ROI, whereas grocery retailers with tight margins might aim for a 3:1 ratio. Use industry benchmarks as a guide, but ultimately focus on improving your own baseline.
Building a Data‑Driven Culture
Measurement is not merely a technical exercise - it requires a cultural shift. Here are key principles for fostering a data‑driven marketing organisation:
Transparency: Share performance data with your team, leadership and agencies. Build dashboards that connect marketing actions to outcomes.
Collaboration: Align marketing with finance and sales. When CFOs see clear ROI figures, they are more inclined to invest in successful campaigns.
Continuous Learning: Treat every campaign as an experiment. Document what worked, what didn’t, and why. Celebrate learning as much as wins.
Tools and Technology: Use analytics platforms that aggregate data across channels. In privacy‑constrained markets like the UK, select tools that support server‑side tracking and consent management.
Developing this culture ensures that measurement isn’t an afterthought but an integral part of strategy.
What I’ve learned…
Effective marketing isn’t about doing more - it’s about doing what works. With growing scrutiny on budgets and privacy, UK brands must adopt rigorous measurement practices. Start by defining clear objectives, collect the right data, adjust for organic growth, and use a mix of incrementality testing and attribution modelling to identify winning strategies. Aim for ROMI benchmarks that reflect your industry and margins and don’t be afraid to pivot when the data suggests a new direction.
After 20 years in the field, I’ve learned that marketing appreciation is not determined by how loudly you shout, but by how precisely you measure.
By embracing a data‑driven mindset and continual experimentation, you’ll not only justify your marketing spend - you’ll unlock new revenue streams and drive sustainable growth for years to come.
