In a bustling café in Mumbai, a marketing executive scrolls through her phone, analysing the metrics of a recent campaign. The numbers look good—impressions in millions, clicks aplenty, and conversions climbing steadily. Yet, something tugs at her thoughts: are these metrics truly capturing the campaign’s impact? In the age of digital dominance, where algorithms meet artistry, the question looms larger than ever: is our understanding of ROI in advertising outdated?
On the surface, the concept of Return on Investment (ROI) seems straightforward: measure what you put in, calculate what you get back, and ensure the latter exceeds the former. For decades, this simple equation has guided marketing decisions, acting as the ultimate litmus test for campaigns. Ad spend, customer acquisitions, and revenue growth have been reduced to crisp percentages and sharp numbers, offering clarity in a field that thrives on creativity and ambiguity.
But beneath the surface lies a more complex story. As digital tools have made marketing more measurable than ever before, brands find themselves trapped in a paradox. They can analyse the click-through rates of every ad, attribute conversions to specific channels, and monitor engagement on every post, yet the core question remains unanswered: What does success truly look like?
Consider this: A campaign generates a 200% return on expenditure, delivering immediate sales and measurable revenue growth. The metrics glow green in boardroom presentations. But six months later, the brand finds itself struggling to retain customers, facing negative sentiment on social media, or falling behind competitors in market relevance. On paper, the campaign was a resounding success, yet the long-term story tells a different tale.
This disconnect is becoming increasingly apparent in an age where consumers are no longer just buyers—they are advocates, critics, and collaborators. Today’s audience values purpose, authenticity, and emotional connection just as much as they value price and quality. They judge brands not just by what they sell but by what they stand for. This shift has raised a critical question: Is ROI, as we’ve traditionally defined it, too narrow to capture what really matters?
As Mukesh Vij, founder of Hashtag Orange, puts it, “Marketing goes beyond sales; it’s about building emotional connections. Creating lasting impressions, improving customer satisfaction, and delivering a positive customer experience are key aspects of effective marketing that cannot always be quantified through financial data alone.” This evolving definition demands a deeper look: how are brands measuring ROI today, what are the limitations of current metrics, and how can we redefine success in an increasingly complex media landscape?
A tightrope between short-term and long-term gains
When brands talk about ROI, they navigate between two competing objectives: short-term results and long-term brand equity. These two ends of the spectrum require different metrics, priorities, and investments. As Shashank Lanjekar, National Strategy Head at DDB Mudra, succinctly explains, “Marketing measures are of three kinds: Business, Brand, and Campaign Metrics. Sales volume and ad recall are short-term measures, while equity metrics like sustained share of market or brand awareness are long-term.”
Take, for example, a fast-moving consumer goods (FMCG) company launching a limited-edition flavour. The campaign is designed to drive immediate sales, and the ROI is measured in cold, hard numbers—units sold, revenue generated, and cost-per-acquisition. But what happens after the last packet is sold? Did the campaign build goodwill for the brand, or did it leave customers indifferent?
Brands like Apple have mastered the art of balancing these timelines. Their product launches create instant demand, yet the true ROI lies in their ability to sustain loyalty over decades. Customers aren’t just buying the latest iPhone—they’re buying into the brand’s story, values, and ethos. As Krishna Iyer, Director of Marketing at MullenLowe Lintas Group, observes, “Programmatic efforts fuel short-term sales, but sustainable success comes only from long-term brand building.”
This balancing act is akin to walking a tightrope in a windstorm. Short-term gains deliver immediate validation, but focusing on them too heavily can undermine the long-term value a brand seeks to build. Conversely, long-term campaigns often struggle to show quick wins, testing the patience of stakeholders who demand tangible results.
The gaps in conventional metrics
For decades, ROI has been tethered to financial metrics like profit margins, revenue growth, and cost efficiencies. While these indicators are clear and quantifiable, they often fail to capture the broader impact of marketing efforts. Vij points out, “Metrics such as brand recall value, loyalty, and customer sentiment capture the broader impact of a campaign. Marketing is also about building emotional connections, which often aren’t immediately reflected in financial data but are crucial for long-term success.”
Consider iconic campaigns like Lifebuoy’s “Help a Child Reach 5” or Tata Tea’s “Jaago Re.” These weren’t just ad campaigns; they were movements that touched lives, inspired behavioural change, and built enduring brand associations. The ROI here wasn’t just in increased sales but in deepened trust and societal impact. Iyer adds, “Lifebuoy didn’t just sell soap—it positioned itself as a champion of health and hygiene.”
Similarly, Coca-Cola’s “Share a Coke” campaign wasn’t measured solely by bottles sold but by the emotional connections it fostered. Seeing your name on a bottle wasn’t just a gimmick; it was a reminder that the brand saw you as an individual, not just a customer.
Yet, financial metrics often dominate boardroom discussions, sidelining these intangible outcomes. Lanjekar highlights the harsh reality: “Financial metrics are brutal but inevitable. They shape how campaigns are created and executed in today’s environment.” This creates a gap where vital elements like customer loyalty, brand perception, and emotional resonance are undervalued—or worse, ignored.
“In today’s times, many digital-first brands and those established brands that are just dabbling with the new age mediums look at ROI from a very short-term tangible profit perspective. But brands that truly sustain their shine over a period of time are the ones who have invested with a long-term perspective and are therefore reaping long-term returns in building brand equity,” observes Khyati Sarang, GM – Strategy & Planning, Cheil India.
The fragmented media landscape: Measuring the immeasurable
In today’s fragmented media ecosystem, measuring ROI has become more complex than ever. Digital tools, cross-channel campaigns, and influencer collaborations have multiplied touchpoints, but they’ve also muddied the waters of attribution. Vij articulates the challenge: “It’s tricky to measure the effectiveness of a YouTube ad that drives sales in-store. Tracking cross-platform behaviour is a complex task.”
Digital analytics have certainly revolutionised the way we measure success, introducing metrics like Customer Lifetime Value (CLV), Net Promoter Score (NPS), and social media engagement rates. As Iyer notes, “Digital tools have redefined ROI, turning it into ‘Real-time Opportunity Insights.’ Metrics like CLV provide long-term perspectives, while engagement rates show how audiences interact with a brand at the moment.”
However, these tools also come with limitations. Sarang cautions, “Every medium has a unique role in building brand equity. Long-term focus, with short-term accountability metrics for each medium, could offer a potential solution.” In other words, while digital tools can capture specific behaviours, they must be integrated into a broader framework that accounts for qualitative outcomes like sentiment and perception.
The future of ROI: Relevance over isolation
As consumer expectations evolve, so too must the concept of ROI. Vij predicts that metrics like sustainability impact, inclusivity, and purpose-driven outcomes will take centre stage. “ROI needs a more holistic approach,” he says. “Beyond immediate financial gains, metrics should include long-term brand equity, social impact, and customer loyalty.”
Iyer offers a redefinition: “ROI should stand for ‘Responsibility of Impact.’ The future of ROI will be about cultural relevance, authenticity, and trust.” For brands, this means moving beyond transactional metrics and embracing frameworks that measure their role in society, from reducing carbon footprints to fostering inclusivity.
Technology will play a pivotal role in this evolution. Sarang envisions a future where AI-driven tools integrate behavioural data, sentiment analysis, and customer experience into ROI calculations. “Social and environmental factors will also play a role, as consumers prioritise brands with strong sustainability and ethical practices,” she adds.
Lanjekar offers a contrarian perspective on the excessive focus on long-term brand equity, “While long-term brand building is seen as classic and prudent, it goes against the grain of pacy business growth ambitions that investors, brand custodians and companies set for themselves today. The only change I would consider is being honest about the achievability of the goals set. I often find campaign briefs without reality checks, and these are assignments that set you for failure for the get-go,” he notes.
Lanjekar sees a cyclical future where established brands focus on long-term goals while challengers pursue short-term wins. “The dynamic nature of brands will lead to continuously evolving models of measuring ROI,” he predicts.
In a world where consumers value meaning as much as material goods, it’s clear that the conventional ROI model needs an upgrade. The true measure of success lies not in the numbers alone but in the relationships, trust, and connections that brands build over time.
As Vij aptly concludes, “Marketing is about building relationships that lead to sustained success.” And like any good relationship, the most valuable returns often take time to materialise. For brands willing to embrace this evolution, the journey toward a redefined ROI will be less about chasing numbers and more about creating meaning—one campaign, one connection, and one story at a time.
