Even as lack of measurement metrics impacts events & experiential industry, experts call for focus on Return on Engagement (RoE) more than Return on Investment (RoI) to attract brands and gain an advantage over traditional media
By Samarpita Banerjee
Outdoor Advertising is perhaps the oldest form of advertising and experiential marketing forms an important part of the medium. In an ever-changing landscape of marketing, experiential has somehow withstood the test of time, possibly due to the fact that brands are slowly realizing the power of interactive consumer experiences.
The industry has seen steady growth over the years, and this year has not been any different. The ‘India Experiential Marketing Spends 2016’ report released by Businessworld and TStratCo in partnership with the Event and Entertainment Management Association (EEMA) at the recently held EEMAX Global conclave in Mumbai states that the industry has witnessed 16-17% growth during 2014-16. The experiential marketing industry was worth Rs 6,250 crore in 2014-15, it grew to Rs 7,281 crore in 2015-16, and is expected to touch Rs 8,483 crore in 2016-17.
However, despite this growth, one of the biggest challenges the industry faces is the lack of measurement metrics. Brands, therefore, find it difficult to assess the return on investment (RoI) through experiential marketing. However, experts feel that instead of bothering about RoI, the experiential industry should focus on determining the return on engagement (RoE) from events.
Speaking at EEMAX, CVL Srinivas, Chief Executive Officer, South Asia, GroupM, said the experiential industry should work on creating a metric around measuring RoE. “What the experiential industry needs to do is to value data and value the goldmine that can be created. Collaborate with a larger eco-system and drive more value. Reinvent yourself, keeping in mind what the next 5-7 years will look like. The world has already moved on from measuring likes and shares of events. Today, brand and marketing managers no longer insist on knowing how many people have seen and liked an event. They want to know what it has done to the business and the outcome of an event. In terms of measurement, the industry should work on a return on engagement metric because that’s where experiential truly has an advantage over traditional media,” he observed.
HOW DOES ONE MEASURE WHAT A CONSUMER IS FEELING?
For many, measurement of the event industry is difficult because how does one measure what a consumer is feeling after being part of an experience? Vivek Singh, Joint Managing Director, Procam International, says, “Measurement is a challenge that we face as an industry because how do you actually evaluate all that you are giving back to a client in terms of goodwill, in terms of mind recall and not just the other hard facts that are so difficult and subtle?”
Voicing a similar thought, Mandeep Singh, CEO & MD, CPM India asks, “Measurement is the one big challenge for our industry, but I would want to pose the question that how does one give value to an experience?”
Lack of a measurement metric also leads to the obvious question – how does the industry become more accountable? Says Srinivas, “Not just event management companies, overall accountability, when it comes to marketing investment, hasn’t been on the radar until quite recently. The only thing that could be measured was TV and even that measurement was quite basic. However, there has been quite a change in the last few years. Given the pressure most corporate houses are under, the first question anyone asks before sanctioning a budget is ‘What am I going to get out of it?’ Today, it’s very important to know how an event is going to impact firms. We closely work with Encompass and have begun to put some amount of science and structure to some of these programmes. All this brings me to a fundamental belief that the world of silos is dead. No longer can we be happy by calling ourselves just a media agency, an event management company or a creative agency. The direction for all agencies should be to work on going up the value chain.”
AGENCIES ARE KEEN ON EVALUATING ROE
Meanwhile, experiential agencies are keen on evaluating RoE. Roshan Abbas, Managing Director, Encompass, says, “A bunch of us who work a lot on brand activations are extremely keen on RoE. But a lot of the metrics for events simply show you the earned media you end up getting, but that is not the only metric you should have. We know that 80% of people are fine with having brands in their events. In fact, they like the brand to be engaged with them. Now, this engagement has not been measured, and therefore, we as an industry often end up being a tactical measure, not a strategic measure, and that’s a big issue.”
However, Abbas also points towards a problematic trend in the industry wherein a lot of agencies actually thrive on the lack of measurement. He says, “There are several companies that may be under Rs 10 crore, and they thrive on not being measured. Some of them actually say, ‘Do you know that when I am promising 100 people, I am providing 80 and the client knows that but he is okay because it fits the budget’. Therefore, he is saying that he still manages to make a margin in that business and everybody knows the truth but is happy about it. In our case, we are saying that we want the measurement to be absolutely real. However, not much has happened yet because there are many in the industry who internally oppose it.”
Due to this lack of measurement, it becomes difficult for many brands to invest heavily in events. So is there a way of attracting more brands towards the industry? Mohomed Morani, Managing Director, Cineyug, says, “The only way of pulling more brands towards the industry is by delivering. Brands have become very smart today and expect deliverables. That is the only way of getting them to put in more money.”
Adding to Morani’s view, Sameer Tobaccowala, Chief Executive Officer, Shobiz Experiential Communications, says, “To attract more brands towards the industry, there is a need for more forward-thinking brand managers who are able to discern and realize the brand value in the experiential play. We also need equally pro-active agencies that are able to reach out to a client with an implementation-ready idea which satisfies the client’s marketing objectives – be it through apex initiatives like IPRs or short term tactical initiatives like unique activations.”
‘BRANDS ARE ALREADY SOLD ON EXPERIENTIAL’
However, Mandeep Malhotra, Founding Partner & CEO, The Social Street feels that a lot of brands have already realized the potential of the medium and are making space for experiential in the marketing mix. He says, “Communication is going back to a full circle and experiential is becoming as important as other mediums. Brands have started seeing the value that experiential brings on board. If you look at e-commerce valuation businesses today, their primary objective is that of acquiring customers. And experiential gets you stickiness with regard to that customer, as its impact will last much longer, and brands don’t need to keep visiting customers again and again. Experiential gives brands an immediate impact on stickiness as well as an ability to avoid the wastage of reaching out for the same impact and the monetary effort which would be needed in case of mass media. It’s really a key and brands are moving towards focused investments in the experiential space.”
Talking of hurdles created by the lack of measurement, Atul Nath, Managing Director, Candid Marketing, points towards another challenge that most agencies are trying to tackle. “For our industry, the second big challenge is talent. The challenge is not so much about the skill-set of the existing talent pool within the industry, but of attracting more talent from outside, either laterally or at the entry level. And to that extent, the industry needs to be made more attractive to this talent,” Nath adds.
Moreover, just as the use of technology and digital is becoming critical for most other mediums, many feel that the experiential industry also needs to ensure that it is able to keep up with this trend. While the EventTrack Consumer Survey, 2015 says that consumer usage of mobile devices and social media at events, and the segment that shares their experience with family and friends via technology, has seen a dramatic rise, the industry needs to adapt to the changing eco-system more rapidly. “As an industry, we need to marry the broader digital and technology space. It is very difficult to develop this expertise organically and from within our teams, because the people required are of a completely different skill-set. However, this is more of a challenge on an individual agency level rather than an industry challenge,” Nath adds.
For Rajesh Varma, Director, CRI Events, the only way forward is the use of Big Data. “Going forward, Big Data is going to become the crux of whatever we do, as it will help us understand the consumer better, and get more intimate in conversations,” he says.
For an industry that has maximum potential to create an everlasting impact in the minds of consumers, there are a billion opportunities. Whether the industry is able to adapt to the demands of the changing eco-system and create a bigger impact, both for consumers and brands, is something we have to wait and watch for.