In What is a Salesforce.com Campaign I noted that:

A "Campaign” means something different to every marketing team. For some, campaigns represent the lowest level of marketing tactics. For others, campaigns might be a culminating event like a trade show, including all the supporting tactics (email, sponsored dinners and booth participation). For yet another marketing team, campaigns could be the highest level of organization and measurement, and include an overarching theme (launching a new brand for example) and hundreds of related sub-campaigns and tactics.

Regardless of the tactical level of your campaign tracking, you should structure your Salesforce Campaigns with the right level of granularity- the level that your team is comfortable and committed to maintaining. Remember that your goal is to optimize the Campaign structure in a way that ensures that both marketing and sales users understand it. The easier the Campaign is to read and understand, and the easier it is to visualize the Campaign structure, the more likely it is that you will successfully capture data and measure success. Specifically, it’s crucial that Marketing and Sales users can easily close the Campaign loop by linking new opportunities to Campaigns, and a clear, well organized structure will go a long way towards making that happen.

Parent and Child Campaigns

Leveraging the Parent-Child hierarchy feature in Salesforce is the best way to structure all three of the Campaign group examples mentioned above. While you can nest up to five hierarchies, I have found that two or three levels are sufficient for most companies. In a three level hierarchy, such as the one below, the grandparent campaign is the overarching theme, the parent is the event, and the child campaigns are the specific tactics.

What are the advantages of this type of structure?

Go straight to the big picture. Setting up key reports to examine your campaign groupings at the highest possible level allows for simple, at-a-glance executive reports that are not mired in detail and can quickly report the top line numbers. By leveraging the provided Hierarchy Total fields, you will have automatic aggregation of child campaign statistics.
Drill-down to the detail you need. Using the hierarchical connections you can drill down into a campaign structure to help identify key contributing tactics.
Perform side-by-side analysis. Utilizing Campaign Hierarchies provides you the ability to perform side-by-side comparison of campaign sub-groupings across broader campaigns.

To implement Parent-Child hierarchy in your Campaigns:

Pay attention to your Campaign naming conventions. While the Parent-Child hierarchy simplifies Campaign organization, a standardized taxonomy will make things even easier for your users to understand.
Ensure that the Parent Campaign field is accessible on your page layout.
Populate the Parent Campaign field with the next highest Campaign in the hierarchy. [A Child Campaign would reference a Parent Campaign and a Parent Campaign would reference the Grandparent campaign and so forth.]

A Cloudy Sky Example

I recently worked with a company that adopted the terms “Sky” and “Cloud” to represent their grandparent and parent campaigns respectively. With their set-up, a Cloud campaign is one that ties the tactics of an event together, and a Sky campaign is a roll-up of all the clouds that comprise a theme. Campaigns without designations are at the lowest level of marketing tactics. They appended the "Sky" and "Cloud" terms to the Campaign Name so they could then use it as a report filter. This was a great trick to isolate all of their major Campaign themes to view an aggregate ROI roll-up.

Closing the Loop

The heartbeat of a successful marketing & sales system is the ability to have closed-loop analysis. At Bracket Labs, we utilize a process that encourages our sales users to convert leads directly into opportunities. This conversion “auto-populates” the Primary Campaign Source field, and captures the most recent campaign as the origin of opportunity (the activity that gets ROI attribution). If we have to create a direct opportunity, we ensure that the Primary Campaign Source (a required field in our org) is filled in manually. This is easy for us as we are a small team with a manageable Campaign load.

The company I mentioned earlier has a much larger sales team with a high-volume campaign load. One thing I really liked about this company is their tight interaction between the marketing and sales teams. If a sales user manually creates an opportunity and is not sure which campaign got them there (Was it the email blast, the webinar, or the meeting?), Marketing encourages Sales to select the grandparent option, which is often the simply worded “Campaign.Sky.” By keeping their eyes on the big picture they ensure at a high-level no data is ever lost and because Primary Campaign Source is a unique field, they never worry about double-counting opportunities. They perform their aggregate ROI analysis at the Sky level, and use the Cloud to do a comprehensive post-mortem analysis of components that were most influential. With this method, they learn how to enhance Clouds to get to Sky achievements.

Earlier I mentioned that you should track your campaigns at a level that you are comfortable maintaining. Keep that in mind for ROI reporting as well. Set up your key reports so they examine your campaign at the highest possible level. Once this is done, you can “drill down” to deeper levels. These reports are the most accurate depiction of success. Depending on your corresponding “close-the-loop” process, some accuracy may be lost. But you should be able to identify key tactics that are driving the success of your overarching parent campaign.

Implementation Tips

If possible, create an opportunity creation process that flows directly from the Leads tab for the easiest method of tracking Opportunity ROI.
Be consistent. Make sure every campaign "rolls-up" to a Parent or Grandparent Campaign for high-level reporting.
Create an "Audit" Campaign view with the criteria "Parent Campaign 'not equal' null." Grandparent Campaigns should be the only results in the list.
Create a Grandparent Campaign report that breaks down total performance statistics according to your top-level measurement. Make sure you have the ability to drill down deeper.
There is a limit of five levels in campaign hierarchies, but don't ever get that complex.