Clearly, from immersive theater to pop-up shops, experiences are becoming more common. But are they strong enough to have an impact? Metrics for how they perform and whether they’re worth the cost are often still a bit of a mystery. But that’s beginning to change, as brands and the agencies attempt to prove that experiences—while expensive—can prove worthwhile.
“Experiential companies are going to need to adapt or go away,” said Mat Micheli, co-founder of Viral Nation, a Toronto-based influencer marketing agency. “What I’m noticing is that brands are becoming more conscious of what they’re getting, what they’re receiving and whether they can prove some sort of ROI.”
BYOM (build your own measurements)
To deal with the tedious process of gathering metrics, some agencies are building services in-house. Meta, an experience marketing agency that’s done massive installations for brands like HP at the Panorama Music Festival in New York, understands that gathering info that shows the full impact isn’t always easy.
To solve this, Meta will debut its own platform later this year. The Unreality platform will examine four areas: psychographic data, behavioral data, cultural data and social data. Combining those figures with attendance and social media statistics will create an ROI value.
“You’ve got to look at this stuff in layers and dimensions,” said CEO Justin Bolognino. “There has to be an approach with depth and you have to understand how the different goals intertwine and how KPI and ROI intertwine.”
Despite the simplicity of social media impressions, they’re still an important metric for marketers. The Infatuation, which has been putting on a variety of large and small events since its founding in 2009, sometimes spends weeks cobbling together numbers from social accounts, brand partners and influencers. That can be especially tricky when Instagram Stories disappear in a day and Facebook’s API isn’t accessible to everyone.
“We haven’t found a single company that can report the way we want to report, so we do it ourselves,” said Andrew Steinthal, The Infatuation’s co-founder and CRO. “It’s effective, and so far what you see is what you get.”
Others are experimenting with tracking people in more creative ways on the scene. For example, Portland-based agency Dotdotdash has begun using heat-mapping and facial recognition to understand what draws people to an experience and how long they stay, while Live Nation has begun experimenting with biometric data to gauge fans’ excitement at a concert.
Revenue is of increased importance
Matt Sicaglia, senior director of strategy at RedPeg Marketing, said his agency looks at ROI in three areas: short-term revenue, projected incremental revenue and finally, advertising value. For short term, that might be direct-response at the event such as through sales of products or services, while incremental revenue might be measured by calculating lifetime value of existing or potential customers that engage with an experience.
To track who is influenced to buy something after an event, RedPeg uses third parties to add data that can filter out audiences based on benchmark data for each industry. A brand can then include the average value per customer while also measuring sales based on frequency of purchases. (For example, a person might buy toothpaste every few months, but auto insurance every six months.)
“That’s where the lion’s share of the value of experiential lives is what that projected revenue looks like in the future,” Sicaglia said. “Because a lot of times the experiences that we are creating are great and memorable, but you’re not doing it in a time when someone is ready to pull the trigger on something.”
Some moments just can’t be measured
Mike Fox, CMO of the media and tech company Culture Trip, has been doing experiential events for years. His company recently created a number of experiences at SXSW including a Hong Kong-style market—which had just 3,000 visitors but garnered 180 million impressions online. Fox said it’s important to set expectations early in the process to make sure management understands that not everything can be measured.
“When you’re talking to the CEO or CFO or anyone in the executive suite that’s looking at resources and ROI and metrics,” Fox said, “the first thing you have to tell them is you either have to believe in experiential or not because it’s notoriously hard to measure with precision.”
This content was originally published here.