Methodology of assessing the digital marketing’s impact on business efficiency

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METHODOLOGY OF ASSESSING THE DIGITAL MARKETING'S IMPACT ON BUSINESS EFFICIENCY

Daniella MUSHKA Postgraduate of the Department of enterprise economics of the Faculty of Economics of the Uzhhorod National University

Viktoriya BONDARENKO

Candidate of Economics Sciences, Associate Professor of the Department of business administration, marketing and management of the Uzhhorod National University

Nazariy POPADYNETS

Doctor of Economics Sciences, Senior Researcher, Associate Professor of the Economy and Marketing Department, Scientific-Educational Institute of Entrepreneurship and Perspective Technologies of Lviv Polytechnic National University

Oleksandr KOVAL

Senior Lecturer of the Department of tourist infrastructure and hotel and restaurant management of the Uzhhorod National University

Методологія оцінки впливу діджитал-маркетингу на ефективність бізнесу

Даніелла Василівна Мушка - аспірант кафедри економіки підприємства економічного факультету, ДВНЗ «Ужгородський національний університет»

Вікторія Михайлівна Бондаренко - кандидат економічних наук, доцент кафедри бізнес-адміністрування, маркетингу та менеджменту, ДВНЗ «Ужгородський національний університет»

Назарій Миколайович Попадинець - доктор економічних наук, старший дослідник, доцент кафедри економіки і маркетингу, Навчально-науковий інститут підприємництва та перспективних технологій Національного університету «Львівська політехніка»

Олександр Дмитрович Коваль - старший викладач кафедри туристичної інфраструктури та готельно-ресторанного господарства, ДВНЗ «Ужгородський національний університет»

Вступ. У сучасних умовах ведення бізнесу важливим елементом успіху є застосування методів інформаційних комунікацій. Оскільки сучасне інформаційне суспільство все частіше потребує нових методів комунікування, то використання діджитал-маркетингу в бізнесі є вкрай ефективним, адже воно постійно еволюціонує. Саме тому діджитал-маркетинг є тим засобом, який потрібно використовувати для розвитку сучасного бізнесу.

Мета статті: на основі аналізу та систематизації теоретичних і практичних підходів до комплексного оцінювання ефективності маркетингової діяльності бізнесу виокремити основні методологічні аспекти ролі діджитал-маркетингу у цьому процесі.

Результати. У статті проаналізовано дослідження, спрямовані на визначення сутності поняття «діджитал-маркетинг». Обґрунтовано наукові підходи та розкрито основні інструменти дослідження цієї проблематики. Визначено ефективність впливу від впровадження цифрового маркетингу на сучасний бізнес. Охарактеризовано набір показників ефективності рекламного звернення та їх впливу на бізнес- процеси. Досліджені основні тенденції розвитку діджитал-маркетингових інструментів і їх вплив на результативність бізнесу. Охарактеризовано шляхи розширення можливостей діджитал-маркетингу серед вітчизняного бізнесу.

Висновки. Визначено, що для збільшення ефективності бізнесу потрібно здійснити аналіз діяльності споживачів на інформаційних сайтах з використанням основних аспектів, а саме: увага, зацікавлення, бажання, дія на основі специфічних індикаторів (трафік, конверсія, ліди). Доведено, що проаналізована система основних індикаторів дозволяє комплексно оцінити ефективність бізнесу, оцінювати ефекти від різного роду заходів, визначати і реалізовувати найбільш ефективні економічні інструменти розвитку. Задекларовано шляхи ефективного застосування діджитал-маркетингу щодо визначення основних проблем сьогодення, які можуть впливати на розвиток та ефективність діяльності бізнесу.

Ключові слова: діджитал-маркетинг, бізнес, ефективність, індикатори, маркетингова діяльність.

business digital marketing activity efficiency



Abstract

Introduction. Application of information communications methods becomes an essential success element in current doing business conditions. Since contemporary information society increasingly needs new communication methods, the use of digital marketing in business is very efficient as it consistently evolves. Therefore, digital marketing is the tool to be used to develop business.

The purpose. The article aims to outline the main methodological aspects of the role of digital marketing in the process based on the analysis and systematization of theoretical and practical approaches to a comprehensive assessment of the business marketing activity efficiency.

Results. The article analyzes the research addressing the nature of the interpretation of the digital marketing concept. It substantiates scientific approaches to the subject and outlines the main tools in this phenomenon. The efficiency of impact the digital marketing introduction has on modern business is determined. A set of parameters of advertising efficiency and its impact on business processes are characterized. The main trends in the development of digital marketing tools and their impact on business efficiency are examined. The ways to expand digital marketing opportunities among domestic businesses are characterized.

Conclusions. The article argues that the analysis of customers' activity on informational websites based on such key aspects as attention -- interest -- desire -- activity based on specific indicators (traffic, conversion, leads?should be carried out to improve business efficiency. The analyzed system of key indicators allows for carrying out a comprehensive assessment of business efficiency, estimating the effects of various activities, and determining and implementing the most efficient economic development tools. The ways to efficiently apply digital marketing to define the main contemporary problems that can affect business development and efficiency are declared.

Keywords: digital marketing, business, efficiency, indicators, marketing activity, marketing audit.



Introduction

Digital marketing conditions are gaining increasing importance in the modern world. Traditional marketing tools turn out to lack efficiency in conditions of digital marketing development since they fail to significantly improve the efficiency of the companies' marketing activity and secure the achievement of specific advantages in the information society.

Current trends provide that most companies develop their businesses on the Internet. Businesses face the need for comprehensive use of various promotion tools and methods in the process of active development of digital marketing [1]. Moreover, continuous data collection and analysis and assessment of all marketing activities are essential for maintaining competitiveness as it allows tracking, estimating, and adjusting their efficiency.

Not many researchers address the origins of the digital marketing process in Ukraine. Namely, Т/Y. Dereviyanchenko and LV. Benivska define the nature of digital marketing and its advantages (interactivity, lack of territorial boundaries, easy access to resources, extended coverage of target audience, opportunity for operational assessment of a company's promotion system, event management in real time, etc.). Moreover, the authors characterize the digital marketing promotion channels and their main tools and resources [2].

S.S. Poliakh outlines the results of examining the nature and approaches to the interpretation of the digital marketing concept, as well as the main tools and methods of the phenomenon. The author argues that there are numerous applications and program solutions in the digital marketing world to secure continuous operation. He emphasizes that social media management, computerization, and content marketing are the most common directions of the digital marketing program application [3].

О. P. Solohub and L. V. Kapinus provide that assessment levels and criteria should be clearly defined when assessing online advertising efficiency. Therefore, the advertising efficiency measuring theory offers numerous parameters that provide an opportunity for assessing the advertising efficiency based on the respective statistics. The authors suggest adding the online advertising performance parameter to the range of well-known parameters, which constitutes the novelty of the scientific article. Moreover, they provide a range of recommendations to both improve online advertising efficiency and map the consumers' purchasing power [4].

5. М. Illiashenko and Т.У. Ivanova characterize it as the marketing activity type that provides for communication with the audience through digital channels to accomplish business tasks [5]. Meanwhile, М.А. Oklander and О.О. Romanenko address the marketing activity type that provides an opportunity to directly interact with target segments in the market through digital channels and methods in virtual and real environments [6].

I.P. Danko and І.І. Skorobohatyh argue that digital marketing is the marketing that secures interaction with clients and business partners using digital information and communications technology and electronic devices. In a broader sense, it means the marketing activity based on the use of digital information and communication technology [7].

In practice, digital marketing is among the most efficient ways to make a statement, secure a long-term consistent development for businesses, be competitive, and promote own products. Various methods should be applied together and constantly combined to secure the comprehensive development of all business aspects and activity directions so that the advantages and benefits from their application supplement one another [8].

Therefore, the problem of the comprehensive approach to the assessment of digital marketing efficiency in business activity is underresearched. That is why the issue remains open and requires significant attention from researchers and practitioners at enterprises, taking into account the dynamic changes in market conditions.



The purpose and objectives of the article

The article aims to outline the main methodological aspects of the role of digital marketing in the process based on the analysis and systematization of theoretical and practical approaches to a comprehensive assessment of the business marketing activity efficiency.

Presenting main material

Modern business cannot exist without innovations and advanced technologies that maintain the brand's popularity and increase sales through the attraction of the target audience and different types of interaction with it. These actions are possible, in the first place, in digitalization, namely by the use of digital advertisement and online marketing technologies.

When using various digital promotion tools and online advertising, it is also worth controlling their efficiency. The company developing business and promoting itself on Internet should continuously analyze the current situation and assess the efficiency of advertising campaigns and the number of attracted clients.

There is a system of technometric efficiency parameters allowing estimating the success of an online advertising product at different stages of its functioning - KPI (Key Performance Indicators). The technology helps analyze the efficiency of advertising channels, adjust the campaign strategy, and predict the necessary budget [9].

The efficiency of a company's activity in online advertising should be estimated based on extensive theoretical and practical developments since this issue requires comprehensive research.

Most researchers and practitioners addressing the issue suggest singling out two groups of the online advertising campaign effects: communicative (or informational) and economic.

The assessment of marketing tool and method efficiency should contain a set of quantitative and qualitative parameters bound to systematize information on the efficiency of a company's marketing department in digitalization. The parameters of online marketing measures efficiency assessment are selected based on the consideration of their features and depend on the settled goals and corporate development efficiency tasks.

The following parameters are the generally accepted ones to assess the economic efficiency of implemented digital marketing tools:

1) the growth of a trade company's website visits (it characterizes the website popularity);

2) the number of the company's website revisits;

3) regularity and frequency of the website's visits,

4) the number of indexed websites;

5) the number of links to websites, including external;

6) the cost of an attracted perspective or existing customer;

7) the volumes of information posted on the website or online store regarding the products and events of the company (articles, news, etc.);

8) the number of times the trade company name is mentioned in social networks;

9) citation level;

10) number of sent e-mails and messages;

11) efficiency of various sources of customer attraction to the company's website;

12) efficiency of banner ads (it is determined by the number of visitors using it for redirection to the website);

13) the conversion level that characterizes the company's website quality;

14) entry and exit points, traffic analysis;

15) search engine analysis (where the customers come from);

16) analysis of geography and general features of existing and prospective customers.

The identification of all components of marketing costs, the arrangement of the target audience participation statistics, and the determination of major foundations of impact on customers and position among all competitors in the domestic market are essential for the correct assessment of the online marketing tools application efficiency [10].

When assessing online advertising efficiency, in the first place, its goals and tasks must be matched with the achieved results. The following possible goals can be emphasized: support of goods turnover; sales increase; market share increase; making defined profits; generation of the demand for goods; development of a certain level of awareness about the goods or a company among the customers; development of customer trust in the goods or a company and promotion of a company's or goods' positive image, etc.

The first thing to do is to define specific statistics for tracking and the time framework of assessment. Therefore, it is worth taking into account the following Key Performance Indicators (KPI) [11]:

1. The cost of one perspective client;

2. Revenue from sales;

3. Client value;

4. Ratio of perspective and real clients;

5. Ratio of website visits and number of perspective clients;

6. Organic traffic;

7. Website conversion rate.

After the KPI are defined, it is worth identifying the data that would be taken into account in the analysis. Among the parameters, the following should be emphasized [11]:

1. Overall website traffic;

2. Traffic by source;

3. The ratio of new visitors and returning visitors;

4. Number of visits;

5. Average session duration;

6. Pageviews;

7. Most visited pages;

8. Exit rate;

9. Bounce rate;

10. Conversion rate.

These are the most important parameters. Yet, certainly, there are many others, including coverage, engagement, email open rate, click rate, cost per click, conversion cost, purchase cost, and overall return on investment.

To determine the efficiency of the advertising appeal, some researchers have selected a set of parameters, namely [4]:

1. Demonstration of advertising. Parameters: number of demonstrations; number of unique demonstrations; cost of advertising; crossing audiences; demonstration frequency; CPM (cost per thousand of demonstrations).

2. Attention attraction. Parameters: visibility; recognizability; memorability.

3. Interest. Parameters: number of clicks; number of unique clicks; CTR; click frequency; СРС; CPUC.

4. Website visits. Parameters: number of unique users; number of visits; visits frequency; number of new users; users' geography; number of pageviews; viewing depth; website routes; length of visits; CPUU; CPV.

5. Activity. Parameters: number of activities; number of orders; number of sales, volumes of sales; average purchase value; number of clients; average number per client; CPA; CPO; CPS; CPCr; frequency of orders.

6. Repetition. Number of revisits and repeated actions.

In order to optimize the process of sales and, respectively, increase the business efficiency, the answer to the following question must be found: what share of clients moves to the next stage? For that purpose, all clients' activities on the website should be analyzed across the following aspects: attention -- interest -- desire -- activity based on specific indicators (traffic, conversion, leads).

Traffic is the volume of information passing through the website in a specified period. A bit is a basic unit of information but byte and derivatives megabyte (MB), gigabyte (GB), and terabyte (TB) are used for calculations more often.

It is calculated by the formula:

Traffic = S D,

where R - size of loaded websites;

K - number of visitors per day;

D - number of days in the analyzed period.

Lead as a specific assessment indicator in e-commerce is any activity of a user on a website. It includes registration, posting of personal information, filling out a special form (questionnaire, application), uploading of any data, etc [12].

The leads allow conveying the companies' offers to new clients instantly with converting

them into purchases. The leads are conditionally divided into two qualitative categories [13]:

-sales leads - new clients providing their contacts to make immediate purchase of a certain product;

- marketing leads - prospective clients providing their contacts when subscribing to newsletters, advertising booklets, special offers, information about sales, SMS. They are interested in a product and might become clients in the future.

CPL

where CPL - the lead cost;

Вм - marketing budget;

Ql - number of leads.

Conversion (CR) is the key efficiency measure. It is the ratio of the number of people performing a specific action on the website to the total website visitors calculated by the formula [13]:

CR = ^Z ,

Traffic

where CR - conversion;

Z - number of orders;

Traffic - traffic.

It is worth mentioning that the conversion improvement measures can help achieve the following goals: sales increase retaining the income traffic volume; new client attraction cost reduction or conversion increase subject to the attraction cost increase in order to increase income; online store visits increase. Whereas the conversion is optimized, it will be among the most relevant issues in online marketing.

Conclusions

Active development and the use of digital technologies in modern society have generated the introduction of digital marketing to entrepreneurial activity. The use of digital marketing tools by enterprises substantially impacts the behavior of the target audience, improves the image and achievement of planned marketing goals, and improves business efficiency. The trends are bound to grow. Therefore, it is essential to establish promotion efficiency assessment criteria to analyze advertising efficiency in digitalization. The analyzed system of key indicators allows for carrying out a comprehensive assessment of business efficiency, estimating the effects of various activities, and determining and implementing the most efficient economic development tools.

Nowadays, no practices guarantee complete success. Each of the mentioned steps will not make any company the market leader separately, but together the methods will create the basis for an efficient and profitable business.



Список літератури

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