The history of marketing analysis

Hello and welcome.

In this guide, we take you through the history of marketing analysis, highlighting the main developments that transformed the industry. Marketing analysis has become a pivotal and complex aspect within marketing, yet it wasn’t always the case.

Although exact dates are difficult to find, the earliest marketing activities were related to advertising, branding, packaging, and labelling in the early 20th century.

Although it may have been easy to notice an uplift in sales, in the absence of digital technologies and modern scrutiny, evaluating their effectiveness would have been extremely challenging. In particular, establishing causation over correlation would have been particularly difficult.

This can be summed up simply by considering the famous quote by department-store magnate John Wanamaker (1838-1922) who lamented, “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.”

This remained the case for much of the 20th century. Market research techniques in the form of questionnaires and focus groups offered a valuable way to establish key insights into marketing performance, but with a couple of key limitations.

A key limitation is the link between what people say and do. If an interviewer asks a question “will you buy this product?” or “do you plan to buy this product?” a respondent may answer yes, but never follow up on it. This is then increased by a difficulty in assessing the subconscious impacts of marketing. This makes it very difficult to assess how changes in user experience, colour scheme or logo change by asking people. They are unlikely to be able to put into words how the changes make him feel. Furthermore, they may not know.

This brings us up until the advent of the digital world through the mass adoption of broadband. These developments were underpinned by a rapid growth in computing power, with Moore’s law stating that computing power doubles each year. Entrepreneurs now had the means to create new marketing analysis tools, sparking the growth of technology behemoths, including Google and Facebook.

The introduction of new technologies led to a much broader set of opportunities for marketers to advertise, shifting the allocation of budgets from offline to online. Google introduced display adverts as well as PPC search advertising in 2000. However, the initial uptake was limited as the data analysis was relatively basic, and search traffic was yet to take off in veracity. This all changed with the introduction of Google Analytics in 2005, followed by Facebook introducing ads in 2007.

Marketing analysis changed dramatically following the iPhone’s introduction in 2008. The iPhone’s app store inspired a generation of entrepreneurs, the most famous of which included Instagram in 2010, which transformed the way marketers engaged with an audience and the insights they could collect.

Through time, this had a profound impact as marketers, entrepreneurs, and investors began to introduce a crucial new metric – cost-per-acquisition (CPA). This was a calculation of how much money would be spent to acquire each customer. Notably, it was the ability to compare the data for one channel against another that made it particularly valuable.

Meanwhile, the mass adoption of mobile and digital across the world started to make it possible for startups to scale rapidly by applying similar techniques from one market to the next with the click of a button.

Established businesses were typically slow on the uptake, however. They were used to managing complex relationships with agencies and providers of offline marketing services. The speed of the online world and innovative nature of new startups caught them by surprise.

This didn’t last long, however. Through time, major brands began to increase the competition for digital inventory, and the early hacks that propelled startups became tired as they were tried time and time again by new entrants.

This inspired a much more sophisticated approach to marketing and a much more sophisticated approach to analysis that combined the benefits of both online and offline channels. This can be simplified to ‘content marketing’, which meant creating all marketing activities, and not just advertising behind a clear strategy. In doing so, marketers were quickly required to analysis the success of blogs, white-papers, press releases and posts by evaluating their views, clicks, likes and shares.

There are now more than 600 million blogs, and this ability for all brand to directly build their own audiences has changed the way media companies operate. For brands in particular, PR became a much more data related business, when previously it has been far more relationship driven. The inspired an explosion of ‘clickbait’, with articles often lacking the depth and rigour that they once had.

At this point, it might be easy to think that history will repeat itself over the next few years, but the reality may be quite different. Marketing activities that were traditionally difficult to analyse, and therefore less attractive for marketers, can now be measured more precisely. Marketers can evaluate outdoor advertising using location-based data, and events using passive Wi-Fi tracking and badge scanning. Furthermore, they can now localise and track TV and radio advertising, much in the same way as online advertising.

However, this explosion in data across so many channels, has increased the potential for inaccuracies in analysis. Furthermore, this has increased the visibility of data collection in the minds of the public and sparked privacy concerns. Many people now believe their phone is listening to them.

Further reading

Marketing analysis has come a long way from its early days. Yet, the increase in data has made led to greater concerns over the accuracy of the insights available and the concerns surrounding data collection.

We hope you enjoyed this guide. If you’d like to continue the conversation with us, then please get in touch. We look forward to speaking to you.

Until next time.