“If I gave you $1,000,000, what marketing channels would you invest in to get new customers?” Matt Hertig of Alight Analytics started his recent Kansas City Direct Marketing Association presentation with that question. While the audience provided multiple factors to consider when making a determination of what the answer should be, the overarching answer was that finding meaningful metrics to understand key performance indicators to grow the business were necessary. With that in mind, Hertig presented 5 principles for gathering meaningful metrics.
Principle #1 – Forget About the Customer → Measure the Decision Journey
Many marketers are fully invested in understanding WHO the customer is, but Hertig noted that marketers shouldn’t care who the customer is, but rather how he/she shops. What is the decision journey process? Our job as marketers, according to Hertig, is to create awareness, stimulate engagement, drive impact, and build loyalty. While the channels of transforming wants into needs have changed historically over the years, word of mouth is still the strongest method marketers have today. Social is the bridge to get that out and is a critical part of the customer decision journey. Yet, for many marketers, measuring this journey is difficult, which leads to the second principle.
Principle #2 – Kill the Reporting Silos → Build a Marketing Funnel
The bottom line for killing silos is to stop thinking of response rates by channel. Auditing everything helps build a marketing funnel. When looking at reporting, Hertig breaks the components of marketing out into three different areas: awareness, engagement, and impact. For awareness, building a common taxonomy across channels is important. Determine if clicks on email means the same thing to you as likes on social. This helps aggregate the understanding of the customer’s discovery process. Measuring engagement is a bit easier since it can be seen directly through clicks, downloads, and shares, but connecting it to impact, the final stage in the funnel (the one CEOs care most about), is critical.
Principle #3 – Stop the Data Death March → Aggregate Data 1st Then Reporting
Every marketer has heard of Big Data. With big data comes tons of information and with tons of information comes hours of gathering, building charts and making powerpoints to show the data. Hertig’s company even measured how much time they spent gathering and preparing data versus how much time they actually spent analyzing it. The ratio was roughly 80:20. That ratio doesn’t align with the expertise of marketers who are at their best when building strategy and action off of insights. The 2 part solution to this is aggregating all the data into a single source and then utilizing a reporting tool or dashboard that crunches that data in the best way for the organization.
Principle #4- Reporting Metrics Is Not Enough → Tell A Performance Story
Hertig provided a great analogy for this fourth principle. If you went in to your financial advisor and he/she gave you a transaction report telling you that 27 transactions happened in the past quarter, you’d be confused. You would wonder what those 27 transactions meant. Instead, you want to know what impact those 27 transactions made. Thinking of marketing data similarly is essential. Consider things like “How many impressions generate a visit?”, says Hertig. The real value of marketing can be boiled down to one or two pages that tell a performance story.
Principle #5 It Takes More than Tools to Succeed → 4Ps of Marketing Analytics
When it comes down to it, in marketing, you can’t automate the world, Hertig notes. Marketers are here to make real marketing decisions. To do this, more than tools are needed to succeed. The 4Ps of marketing analytics, Plan, People, Process, & Platform, will help organizations start with the strategy instead of the software.
Hertig’s presentation makes marketing analytics seem intuitive. His principles help make the decision of which channels to invest in more clear. What needs to be understood before diving in though, is there is one major assumption baked into these principles: the presence of data. Tangential to that is the cleanliness of that data. Without clean data, meaningful metrics are virtually impossible to produce.