Choosing the Right Metrics, Measuring the Right Things

Choosing the Right Metrics, Measuring the Right Things

Nineteenth century Philadelphia retailer, John Wanamaker, once remarked, “half the money I spend on advertising is wasted; the trouble is I don’t know which half.” For more than a hundred years, marketers all over the world have been trying to determine the impact of their work and the relative contribution of various initiatives. They may now be seeing light at the end of the tunnel. More than ever before, we have tools to track the impact of various actions through marketing analytics.

Marketing analytics involves analyzing data generated from marketing tactics to evaluate results and determine performance. The most elusive parameter has been determining attribution, i.e., exactly which campaign, ad, or keyword is responsible for a desired outcome. Unless we know what works and to what extent, we cannot judge impact and adjust tactics with confidence.

According to McKinsey & Company, organizations with strong analytics capabilities are 1.5x more likely to grow faster than their peers. An increasing number of companies (61%) are using analytics effectively compared to 43% just five years ago and 65% anticipate increasing budgets on predictive marketing analytics.

Building a Foundation

First of all, we need to know what should be measured. It starts with business leaders agreeing on what are the keys to success. This appears straightforward but things start to crumble even at this early stage. Many marketers chase after vanity statistics, like growth in followers, number and time of engagement, time spent on webpages etc. There is nothing wrong with this approach because it is directly related to the impact their content is having as they strive to reach their prospects. It shows increased awareness and interest in the market segments of choice. However, c-suite might find these top-of-the-funnel numbers to be superfluous. They likely value the number of conversions, leads, and revenue. We address these issues in greater detail in our blog, “How to Justify a Marketing Budget.”

Marketers justifiably feel that there is not a straight line between their performance and revenue. Under-performing sales team and many other variables can negate the impact of their work.

Campaign Metric Ideas

The marketing analytics process is a continuous cycle of measuring, analyzing, and improving. As for specific metrics to measure for campaigns, we recommend starting with:

  • Website: number of visitors broken down with unique views and overall views, what pages are viewed, session duration, behavior.
  • Social Media: impressions, clicks, interactions (likes, comments, reactions), shares.
  • Digital Ad Campaigns: impressions, clicks, click-through rate, conversion rate, cost-per-click, cost per conversion.
  • Email Campaigns: open rate, click rate, bounce rate, conversion rate, unsubscribe rate.

Knowing the metrics, you first establish the baseline. This should be done for several weeks to get a robust dataset that can account for natural fluctuations in data. At this point, one can start doing A/B testing to see if the numbers improve. Subsequently, this becomes a repetitive game of testing, analyzing, and adjusting. This can be done for all the marketing assets to optimize messages, channels, targets, and frequency.

Tools used in data analytics for marketing

Some popular marketing analytics tools include:

  • Website analytics tools:
  • Social media tools:
    • Sprout Social,
    • BuzzSumo,
    • Brandwatch, and
    • Hootsuite.
  • Marketing automation tools:
    • HubSpot,
    • Marketo,
    • Keap, and
    • MailChimp.
  • Business Intelligence and data visualization tools:
    • Power BI,
    • Chartio,
    • Oracle Business Intelligence, and
    • SAP Business Objects.
    • Cohort analysis tools to see how metrics change over time, e.g.:
      • Mixpanel and
      • KISSmetrics
  • SEO tools:

Using these tools can help a marketer make informed decisions about optimizing marketing campaigns and better use of marketing dollars. It would also help in justifying budgets when quantitative data can be shown on the impact of your marketing efforts.