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Tracking in Digital Marketing: What is it and why will it increase your profit?

Lee Sproat

July 21, 2020   DEV

Advertisers are spending less each year on traditional advertising channels and investing more in digital media.

Naturally the pandemic will have accelerated this effect with a decrease in out-of-home advertising, but all the data suggests digital would still be on the up-and-up regardless. Even investment in TV advertising is set to decrease.

Why? A clear return on investment (ROI). Through accurate tracking, advertisers can clearly see the outcomes generated from any investment.

Tracking gives you visibility on how well you are reaching your goals and objectives. It allows marketers to review which creative works best. It allows advertisers to optimise their spend to generate the most goals at the lowest possible price. It even helps give users a better experience. Accurate tracking is crucial for you to run a successful digital campaign.


Full-Funnel Tracking

At the top-end of the marketing funnel (TOFU), tracking can mean knowing exactly how many times your ad was shown and to how many individuals. Some platforms will also reveal impressions for various dimensions; eg. impressions by age, device, publisher website, city, interest, even by company or job title.

For engagement and consideration metrics in the middle of the funnel (MOFU), tracking allows advertisers to take the aforementioned dimensions and apply them to clicks or video-completions. How engaging was your ad for people in a particular age group? Never mind small focus groups – you can see how many people viewed the whole of your video vs the number of times it was displayed. That’s an incredibly powerful way to measure which creative works best and apply that knowledge to future campaigns.

At the bottom of the funnel (BOFU), tracking can mean the measurement of “conversions”. When a user takes a meaningful action, as defined by yourself, they are said to “convert”. Conversions are separated into micro and macro. A micro conversion is typically when a user adds an item to the website basket or downloads a brochure – they don’t usually have a monetary value but they are an indicator of website engagement, which could lead to a macro conversion. A macro conversion is when a user converts into a lead or a sale online, or when they make a phone call to your business or visit your premises offline.

Tracking allows advertisers to report on which ad-impressions and ad-clicks resulted in these converting actions; seeing this video led to a sign up; a click on this ad on this device led to a brochure download.

Full-funnel tracking goes further and allows us to see which enquiries turn into sales, and how much those sales are worth. If you push this data back into your advertising platforms then you can optimise the performance of your investments even further.

Tracking to Increase Revenue

The majority of the work we do focuses on generating revenue for our clients. Accurate tracking means that we help businesses advertise effectively; filling the top of the funnel and encouraging users to progress down through the funnel until revenue is generated.

But it doesn’t stop there, because tracking allows us to retarget “converters” later on: for example, by showing ads to previous customers around key holidays with new offers or shopping events.

If the right actions are being tracked, machine learning algorithms can combine historic conversion data with recent data signals to help businesses to reach their goals more effectively, in turn generating even greater return on investment.

Many advertising platforms allow the selection of specific campaign goals and targets that help steer budget to reach your marketing goals as effectively as possible. This can also be achieved manually, but performance tends to be better when automation and machine learning are utilised; machines can do millions of equations in one second, but humans can barely do one.

With accurate tracking of user behaviour, it is possible to conduct A/B split-tests. You could test different ad images and text against each other to see which performs better. You can do the same with different versions of your website. If the test is successful, then you can make changes that you can be sure will generate more revenue. If unsuccessful, you can still take away some key learnings for your next test. This wouldn’t be possible without tracking.

Tracking Accuracy

You can track more than one conversion goal per campaign, but if less desirable conversions are being tracked alongside more desirable ones – and are given the same weight more desirable actions – performance will suffer. For example, giving a newsletter signup action the same value as a purchase will impact reporting, and is also likely to impact performance.

The conversion actions being tracked should be in line with your campaign’s goals and objectives. The KPI of an awareness campaign would be reach, impressions, or brand lift – not a transaction. Whereas, if your goal is to generate sales and leads at a great ROI, then you should not be generating as many clicks as possible; instead, you want the right clicks, so your goals would be leads and/or transactions.

Besides making sure your ad platform is set up correctly, analytics software should also be set up correctly. This is important to attribute user-behaviour and their actions correctly. Common mistakes that we see on Google Analytics are: the wrong goals being tracked, tracking code is not installed on every page, cross-domain tracking is broken, and/or referral exclusion lists are not set up correctly.

Looking Ahead

A significant challenge for the digital marketing industry is privacy. Each year more users are blocking tracking cookies. Plus, rules and regulations like GDPR, LGPD and CCPA make it more difficult for websites to track all conversions. It varies by industry, but we have seen some businesses lose up to 30% of their tracking due to updated website cookie policies and/or users blocking tracking cookies.

Whilst it is important that people’s privacy is respected, unfortunately, this could ultimately have a negative impact on user experience. Tracking user behaviour can provide websites with data that can lead to positive changes, for example, easier website navigation or simpler access to information most relevant and useful to users. With conversion data, machine learning can identify trends and show ads more often to people who are most likely to take a business’ desired action – and this can also save the user precious time. It is not a good user experience for a user to spend a long time navigating ads for products and services that aren’t right for them. To maximise ROI, advertisers only really want to promote themselves to the right users – it would be a waste of money not to. Therefore, showing the right ads to users provides a better user experience.


The trend of moving investment away from traditional advertising and into digital is testament to the success that is possible thanks to digital marketing. But measuring the performance of digital marketing is only possible with accurate tracking. With this, you can reach potential customers with the right message at the right time, whilst maximising your ROI – making everyone a winner.

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