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Building a Financial Justification for DAM

Content Lifecycle

Planning & Performance

Investing in a new digital asset management solution is a significant decision for most enterprises, and in most cases, the proponents of the new DAM solution will be required to prepare a business case in order to convince enterprise leaders to move forward with the investment.

A complete business case will include a financial analysis designed to demonstrate that the acquisition of the new DAM solution will be a sound financial investment. There are a number of ways to evaluate the financial impact of a proposed DAM investment, but the most common way has been to estimate the return on investment that the new DAM will produce.

This is far easier said than done. Developing an ROI model for a proposed DAM solution isn’t all that hard. Developing an ROI model that’s accurate and credible is difficult for at least three major reasons:

  • It requires an accurate estimate of future benefits, most of which are inherently uncertain.
  • Today, a DAM solution is typically one component of a larger ecosystem of interdependent marketing technologies. Collectively, these technologies can deliver significant financial benefits, but there is often no accurate way to apportion the benefits among the various technology systems.
  • Many of the benefits produced by a DAM solution result from the ability to implement more efficient marketing processes. It’s possible to develop cost models for existing and future marketing processes, but it requires a significant amount of time and effort to gather sufficient data to make the costing reasonably accurate.

Some DAM solution providers have published ROI models that purport to provide a relatively simple way to estimate the ROI of a DAM solution. Most of these models emphasize process improvement benefits such as the cost savings that result from “reduced search time.” As noted earlier, it’s possible to estimate such cost savings, but it requires a significant investment of time and effort to produce accurate results. Therefore, many enterprises rely on employee surveys or other sources of data that aren’t accurate or reliable.

More importantly, most of the ROI models created by DAM solution providers don’t adequately reveal how a robust DAM solution contributes to a high-performing marketing “system” that drives superior business performance.

We’ve recently published a Business Case Guide that describes a methodology for building a financial justification for a DAM solution that avoids the inherent flaws of the traditional “ROI” approach.

You can download a copy of the Guide here.


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