Digitization has increased the marketing touchpoints in a customer
journey before marketers can find a quality lead or a make a sale. How can we
ensure that our investments are working and if we are better connecting with
our customers? The answer lies in better measurement. To achieve more Marketers
should determine their measurement foundation first before they dive into the
creative work. There are four components
that can help Marketers build a strong analytical foundation for their
campaigns:
Selecting the right metrics
In picking the right metrics marketers should ensure that the metrics
they select are aligned to the goals
which determine the success of their campaign. Picking metrics that resort to
measuring lower tier indicators will lead to an irrelevant understanding of the
success of the campaign. If your company’s biggest goal is to increase profits
then you should show how your campaign contributed to the profits. If your goal
is to generate online leads than lowering your cost per acquisition (CPA) might
also lower the quality or volume of your leads and eventually driving down your
revenues and profits. In this case you might need to create a new metric such
as cost per high quality acquisition.
Next factor to focus on in picking the right metrics is the context. Suppose you launch an online
video and you get ten thousand views. How do you really know whether that
number is a good number or a bad one? May be you should compare your video to
similar videos and determine your success. You might also think about the
creative goal behind your video. If you launched the video to spread awareness,
were you able to achieve that? It is important to look at your metrics in the
context of comparable benchmarks or success criterion to drive value from
them.
The final point is to ensure that you have reliable data to keep track of your results and drive your metrics
from. Your metrics will be as good as your data. You can use the appropriate
analytical tools for both online and offline channels to be able to collect
accurate data that will give you an insight about your performance. The more
reliable your data is the better you will be able to respond to the needs of
your customers.
- Have I selected relevant metrics and benchmarks to measure marketing success?
- Do my marketing metrics align with business goals such as revenues and profits?
- How can we break down silos and make teams jointly accountable?
- Do I have the right measurement tools on hand?
Value your best customers
As much as it is important to know what to measure it is also
important to know who to measure. And instead of measuring the customer
transactions alone it is important to model the life time value (LTV) you
derive from your customers. For example, it is quite possible that 20% of your
customer drive the 80% of your sales (80/20 rule). And focusing on getting to
know these 20% customers better can help you distinguish between your ‘whales’
form the ‘wasted energy’. And as you start to know your customers more,
remember that the customer journey is constantly evolving and you will have to
constantly adjust your campaign to continue to connect with them.
- How much do I really know about my customers? Have I defined “customer” clearly?
- How do I acquire more customers who resemble my best existing customers?
- Do my advertising investments align with my strategy to reach and win the “whales”?
Attribute value across the
journey
Marketing attribution can be broadly defined as dividing up the value
of an online conversion across the different touchpoints that led to that
point. Attribution helps you understand what is working in your marketing and
what is not. It can help you understand and optimize your different marketing
channels and how they are influencing your customers so that you can not only
adjust your investments but also your strategy. Attribution is backward looking
and will not be able to tell you if you have used a new channel in you
campaign. To get the most out of attribution marketing tools can be paired with
the channels.
- Am I measuring and valuing all of my customer touchpoints, both within channels and across channels?
- What does the full customer journey to conversion look like for my business?
- Am I applying attribution results to improve my investment decisions as well as my customer messaging?
Prove marketing impact
Ultimately the right metrics, the right customers and the right
channels all have to lead to an impact that the business is striving to
achieve. And as a marketer you should be able to clearly demonstrate the
effectiveness of your campaign to manage the perception of the investment among
senior executives as well as to ensure marketing is seeing as a revenue driver
rather than a cost center. The best method to prove the impact is through
causal measurement. To show causation, you have to experiment that are well designed
and statistically robust with a clear test group. These experiments should be
on going and iterative. To get a feel for the types of hypothesis that you want
to test keep up to date on industry trends and consumer studies. Through this
process you should strive to show that the marketing department or your
campaign is fattening the bottom line and use what you learn to validate your
own investment plans.
- Am I relying on correlations, or can I base my decisions on measured causal impact?
- Do I know the incremental value of each of my media investments?
- How can I incorporate experimentation to prove the value of my marketing, including new channels?
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