Measuring marketing performance isn't easy, but it's the only way to prove the value of marketing to senior managers and to improve marketing results. This session by consultant David M. Raab shows how to build a complete analytical environment including a formal business model, structured testing process, and integrated technology platform.
9. Formal Business Model: Self-Assessment Business Model level 1 level 2 level 3 marketing value measure no reporting; capture response capture response rates and cost/response measure lifetime value, understand customer flow, relationships among programs benchmarking no benchmarks compare vs. own previous performance compare vs. industry standards, best-in-class marketing planning track cost and schedule set targets based on past results & program goals measure short- and long-term impacts, actual vs expected marketing optimization none; allocate spend based on history set targets for media mix based on incremental ROI formal modeling for marketing impact and mix optimization
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11. Structured Testing Process: Self-Assessment Testing Process level 1 level 2 level 3 test selection select test programs randomly define program goals by customer lifestage set lifestage targets and select tests to reach; portfolio approach test design informal testing occasional testing, aimed at immediate response formal plans for all tests, with long-term measures and deployment plans deployment use outside vendors for new media hire specialist staff for new media formal training for new media; organize by customer or product
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14. Integrated Technology Platform: Self-Assessment Technology Platform level 1 level 2 level 3 data management silos; no central database marketing database w/ CRM and transactions; no online integrated online w//offline execution separate systems for each medium outbound campaigns from central system inbound and outbound from same system, including real time online testing capabilities none simple a/b response tests long-term stream tests
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17. Self-Assessment level 1 level 2 level 3 Technology data management silos; no central database marketing database w/CRM and transactions; no online integrated online w//offline execution separate systems for each medium outbound campaigns from central system inbound and outbound from same system, including real time online testing capabilities none simple a/b response tests long-term stream tests Business model marketing value measure no reporting; capture response capture response rates and cost/response measure lifetime value, understand customer flow, relationships among programs benchmarking no benchmarks compare vs. own previous performance compare vs. industry standards, best-in-class marketing planning track cost and schedule set targets based on past results & program goals measure short- and long-term impacts; compare vs expected results marketing optimization none; allocate spend based on history set targets for media mix based on incremental ROI formal modeling for marketing impact and mix optimization Testing Process test selection select test programs randomly define program goals by customer lifestage set lifestage targets and select tests to reach; portfolio approach test design informal testing occasional testing, aimed at immediate response formal plans for all tests, with long-term measures and deployment plans deployment use outside vendors for new media hire specialist staff for new media formal training for new media; organize by customer or product
19. 1. Social Media Does It All goals: explain new product awareness of company create relationship awareness of capability credibility as competent vendor quality of service competitive superiority media strengthen relationship advertising & PR x x SEM and display x x SEO and Web site x x x x x social media x x x x x x x x email, mail, phone x x Web events x x x trade shows x x x nurture email x x x x x x in-person events x x x retain grow acquire
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22. Different Social Media for Different Objectives wikis photo sharing location check-in online video podcasting blogging message boards reviews/ratings Twitter social networks Media customer support engage customers monitor & respond marketing (lead gen) awareness engage influencers competitor monitoring market research Objectives x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x
23. … Also Different Resource Needs staff experience funding web analytics media reach public interest technology customer data Resources x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x wikis photo sharing location check-in online video podcasting blogging message boards reviews/ratings Twitter social networks Media
24. Match Media to Objectives and Resources wikis photo sharing location check-in online video podcasting blogging message boards reviews/ratings Twitter social networks Media customer support engage customers monitor & respond marketing (lead gen) awareness engage influencers competitor monitoring market research Objectives x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x staff experience funding web analytics media reach public interest technology customer data Resources x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x Assess resources Design test Execute test Identify Options Define objectives Deploy winners Select project Read results Learn and refine
25. Example: Automobile Recall Wikis photo sharing location check-in online video podcasting blogging message boards reviews/ratings Twitter social networks Media customer support engage customers monitor & respond marketing (lead gen) awareness engage influencers competitor monitoring market research Objectives x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x staff experience funding web analytics media reach public interest technology customer data Resources x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x Assess resources Design test Execute test Identify Options Define objectives Deploy winners Select project Read results Learn and refine
26. Example: Automobile Recall Wikis photo sharing location check-in online video podcasting blogging message boards reviews/ratings Twitter social networks Media customer support engage customers monitor & respond marketing (lead gen) awareness engage influencers competitor monitoring market research Objectives x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x staff experience funding web analytics media reach public interest technology customer data Resources x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x Assess resources Design test Execute test Identify Options Define objectives Deploy winners Select project Read results Learn and refine
27. Example: Automobile Recall Wikis photo sharing location check-in online video podcasting blogging message boards reviews/ratings Twitter social networks Media customer support engage customers monitor & respond marketing (lead gen) awareness engage influencers competitor monitoring market research Objectives x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x staff experience funding web analytics media reach public interest technology customer data Resources x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x Assess resources Design test Execute test Identify Options Define objectives Deploy winners Select project Read results Learn and refine
what’s the problem? - lots of new channels; each takes an expert; don’t know how to measure, prioritize or compare; don’t have time or money to try them all; on top of usual pressures to produce immediate results, be more nimble; not enough to run each channel separately -- must coordinate across media for best impact - so, the problem is: how do you optimize your marketing mix; i.e., decide which channels to use and how to use them, and implement your decisions
short answer: testing - establish objectives for new media; test to see how well can deliver; plan for deployment and execute - recognize that results will improve over time
long answer: analytical environment - need to put individual tests into context - requirements for this include: - disciplined process to gather resources, design meaningful tests, read results, AND DEPLOY successes - baseline business model to understand current environment, how existing programs perform, how they interact and relate to long-term results - technology platform to execute tests and, in particular, gather results; although typically execute tests externally, MUST gather consolidated results and must have long-term path to integration
long answer: analytical environment - need to put individual tests into context - requirements for this include: - disciplined process to gather resources, design meaningful tests, read results, AND DEPLOY successes - baseline business model to understand current environment, how existing programs perform, how they interact and relate to long-term results - technology platform to execute tests and, in particular, gather results; although typically execute tests externally, MUST gather consolidated results and must have long-term path to integration
- document contributors to customer value, e.g. acquisition costs + retention period + value/year; could be more granular if you have the data - then, drill into contributing factors e.g. acquisition cost and customer value by channel, by customer segment; cost and impact of retention programs by channel and segment; drill into funnel stages e.g. awareness, interest, desire, action LTV = Acquisition Cost + (Value/Year x Years/Customer) - ideally, find industry benchmarks to see where you’re weak or strong; can be hard; even without, can set hurdles relative to own performance
- document contributors to customer value, e.g. acquisition costs + retention period + value/year; could be more granular if you have the data - then, drill into contributing factors e.g. acquisition cost and customer value by channel, by customer segment; cost and impact of retention programs by channel and segment; drill into funnel stages e.g. awareness, interest, desire, action LTV = Acquisition Cost + (Value/Year x Years/Customer) - ideally, find industry benchmarks to see where you’re weak or strong; can be hard; even without, can set hurdles relative to own performance
- define objectives (based on company goals e.g. acquisition, new products, retention, etc., weaknesses in existing funnel ), identify alternatives (based on industry info, understand how they are used, likely results, suitable industries, prerequisites in data, skills, technology ), assess resources (skills, budgets, data); select by matching alternatives, resources & goals to prioritize (recognize different alternatives have different applications); desi gn proper tests (control groups, measurable data, large enough to read), execute , read results (short- and long-term), deploy results; learn and refine (must have standard, visible reporting so can’t bury mistakes; Aberdeen: disciplines process is one of key distinguishing features for best in class); should set aside reasonable budget for testing – fail quickly - marketing mix modeling: formal modeling to optimize allocations; works with known, stable rather than unknown, new media; also need but is refinement applied to stable industry - consider ‘meta process’ of portfolio of tests, balance across channels, anticipated changes in business (e.g. move towards Internet)
- define objectives (based on company goals e.g. acquisition, new products, retention, etc., weaknesses in existing funnel ), identify alternatives (based on industry info, understand how they are used, likely results, suitable industries, prerequisites in data, skills, technology ), assess resources (skills, budgets, data); select by matching alternatives, resources & goals to prioritize (recognize different alternatives have different applications); desi gn proper tests (control groups, measurable data, large enough to read), execute , read results (short- and long-term), deploy results; learn and refine (must have standard, visible reporting so can’t bury mistakes; Aberdeen: disciplines process is one of key distinguishing features for best in class); should set aside reasonable budget for testing – fail quickly - marketing mix modeling: formal modeling to optimize allocations; works with known, stable rather than unknown, new media; also need but is refinement applied to stable industry - consider ‘meta process’ of portfolio of tests, balance across channels, anticipated changes in business (e.g. move towards Internet)
- ideally, central customer database w/data from all channels linked to individuals - this works in database marketing, where control most messages; not so much in either brand marketing or (some) online marketing, where may not know individual customers at all, or may have semi-anonymous ID e.g. cookie, site registration; often can link via email address but not always; if not, then can still use channel-specific measures with high coverage, or samples against panels or surveys; better approximately right than precisely wrong; increasingly possible to integrate data e.g. social media handle, demographics/clusters based on IP geotargeting, behavioral segments within ad networks - cross channel in particular requires central execution platform: starts with profile, includes scoring, message selection, lists for outbound direct mail / email / phone; realtime interactions by Web, phone; possibly ad serving; social media tracking and execution e.g. case mgt, sentiment analysis, influence measurement; also content mgt, selection & reuse (“content grazing”); integrated testing and tracking
- ideally, central customer database w/data from all channels linked to individuals - this works in database marketing, where control most messages; not so much in either brand marketing or (some) online marketing, where may not know individual customers at all, or may have semi-anonymous ID e.g. cookie, site registration; often can link via email address but not always; if not, then can still use channel-specific measures with high coverage, or samples against panels or surveys; better approximately right than precisely wrong; increasingly possible to integrate data e.g. social media handle, demographics/clusters based on IP geotargeting, behavioral segments within ad networks - cross channel in particular requires central execution platform: starts with profile, includes scoring, message selection, lists for outbound direct mail / email / phone; realtime interactions by Web, phone; possibly ad serving; social media tracking and execution e.g. case mgt, sentiment analysis, influence measurement; also content mgt, selection & reuse (“content grazing”); integrated testing and tracking
- ideally, central customer database w/data from all channels linked to individuals - this works in database marketing, where control most messages; not so much in either brand marketing or (some) online marketing, where may not know individual customers at all, or may have semi-anonymous ID e.g. cookie, site registration; often can link via email address but not always; if not, then can still use channel-specific measures with high coverage, or samples against panels or surveys; better approximately right than precisely wrong; increasingly possible to integrate data e.g. social media handle, demographics/clusters based on IP geotargeting, behavioral segments within ad networks - cross channel in particular requires central execution platform: starts with profile, includes scoring, message selection, lists for outbound direct mail / email / phone; realtime interactions by Web, phone; possibly ad serving; social media tracking and execution e.g. case mgt, sentiment analysis, influence measurement; also content mgt, selection & reuse (“content grazing”); integrated testing and tracking
can’t properly select what to test until you know what your business needs are, per your business model
- identify alternatives 5 SM app types (see Silverpop ppt) (25% generate awareness, 18% customer engagement, 16% engage analysts/influencers, 15% market products, 14% monitor and respond, 8% competitive tracking, 4% other); different needs for each e.g. network ads, mobile apps, email names, leadership content, blog traffic; Toyota: monitor & respond; had previous experience e.g. with Scion ‘crowdsourcing’ for customization
- select: match alternatives, resources & goals to prioritize (matrix & scoring):
- select: match alternatives, resources & goals to prioritize (matrix & scoring):
- select: match alternatives, resources & goals to prioritize (matrix & scoring):
- select: match alternatives, resources & goals to prioritize (matrix & scoring):
- select: match alternatives, resources & goals to prioritize (matrix & scoring):
- select: match alternatives, resources & goals to prioritize (matrix & scoring):
- design proper tests (set goals, pick metrics, define size and timeframe, estimate value): metrics - web traffic, qualified leads, customer loyalty/retention, brand awareness, revenue; Toyota: traffic & attitudes
- execute : plan carefully; use external resources as necessary; monitor execution closely for glitches; ensure metrics gathering is in place; Toyota: http://toyotaconversations.com/ ; assigned team of 6-8 people to monitor; reached out to advocates
- deploy results (deployment process): scaling is issue in manual social media; need steady stream of content; some campaigns have specific shelf-life but then is hard to justify value (depends on goal – e.g., product intro is one-time anyway); long-term goal is usually to build on-going community