• by Laurie Sullivan  @lauriesullivan, July 22, 2012

As TagMan prepares to introduce a mobile application tag management tool, the company will release findings Tuesday from Forrester Consulting commissioned research that identifies risks in tag management strategies -- not just to manage and collect data, but also quantifies return on investment and determines costs and savings.

TagMan CRO Nancy Marzouk said many implementations require image pixels running alongside DoubleClick, Atlas and other third-party systems to capture impression- or click-based data, providing a consolidated view. The data also supports real-time bidding through companies like Marin and MediaMath for exchanges for search or display bid optimization.

For one commercial airline, Forrester found data from tags generated 128% ROI, about $2 million the first year. The airline's Web site contributes more than 20% of its sales, doubling growth yearly. The airline runs 16 Web sites with a variety of digital technologies.

The insights gained from digital advertising and marketing, rather than looking at each individually, would support attribution modeling. One project involved embedding live chat on the company's Web site.

The airliner also wanted to launch an affiliate program requiring a de-duplication process, which prevents double charges, to correctly pay out commissions. It allowed the carrier to track organic search results without changing the attribution model, so it could leave the affiliate compensation structure running as long as they needed it.

Once the airline carrier had implemented de-duplication of their performance media, they found that they saved an average of $158,060 on cost per acquisition commission payments yearly. Total de-duplication savings to the organization during the three-year analysis reached $474,180.

Prior to implementing TagMan's technology, the airline spent a "large proportion" of its maintenance cost of the Web site managing campaigns. The company claims that using the tag management system saved it about 120 developer hours on average monthly in tag implementation and management fees -- for a savings of about $66,000. The airline can now implement projects more rapidly. Those that previously took three or more months now take six weeks.

Forrester defines two risks associated with this analysis: implementation and impact. The greater the uncertainty, the wider the potential range of outcomes for cost-and-benefit estimates.

Several risks affect cost, such as the internal labor needed to implement and support the project may exceed initial estimates. Variations in internal tag management cost reductions depend on the number of managed tags and new market initiatives. Higher risk of de-duplication savings also remains dependent on the number of affiliates that affect future marketing spend.

Forrester's analysis identifies ways that companies can adjust for risk and uncertainty. The model uses a triangular distribution method to calculate risk-adjusted values. To construct the distribution, it is necessary to first estimate the low, most likely, and high values that could occur within the current environment. The risk-adjusted value is the mean of the distribution of those points, applied to a company's risk range.