comprehensive digital marketing - a primer on data driven marketing

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Digital Marketing A Comprehensive Primer on Data Driven Marketing

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I found this presentation from 2011 in my digital drawers and thought I'd share it with you as it seems to be still relevant after all these years. I hope you find some useful information in it. I've redacted some customer specific information, but mostly complete. Follow me on twitter for more: http://twitter.com/blacktar

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Page 1: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Digital MarketingA Comprehensive Primer onData Driven Marketing

Page 2: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

The Last Advertising Agency on Earth

http://youtu.be/ERGrSQoY5fs

Page 3: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

What is Digital Marketing?Outbound versus inbound, flipping the funnel and a whole new ball game

Page 4: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Digital MarketingDigital Marketing is the promoting of brands using all forms of digital advertising channels to reach consumers. This now includes Television, Radio, Internet, mobile, social media marketing and any other form of digital media.

Whilst digital marketing does include many of the techniques and practices contained within the category of Internet Marketing, it extends beyond this by including other channels with which to reach people that do not require the use of The Internet. As a result of this non-reliance on the Internet, the field of digital marketing includes a whole host of elements such as mobile phones, sms/mms, display / banner ads and digital outdoor.

Previously seen as a stand-alone service in its own right, it is frequently being seen as a domain that can and does cover most, if not all, of the more traditional marketing areas such as Direct Marketing by providing the same method of communicating with an audience but in a digital fashion. Digital is now being broadened to support the "servicing" and "engagement" of customers.

Page 5: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Marketing Definitions

๏ Outbound Marketing = Old World MarketingFocus on finding the customers. Push Marketing.

๏ Inbound Marketing = Digital MarketingFocus on getting found by customers. Pull Marketing.

Page 6: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Inbound Marketing

๏ Content (Blogs, Videos, White Papers, eBooks, etc.)

๏ SEO / SEM and Keyword Analysis

๏ Social Media / Word of Mouth

Page 7: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Flipping the (Sales) Funnel

1.Turn strangers into friends

2.Turn friends into customers

3.Turn your customers into your salespeople

4.“Flip the funnel and turn it into a megaphone!” - Seth Godin

Page 8: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Flipping the Funnel

Page 9: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Flipping the Funnel

Page 10: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Digital Marketing =

Marketing - only better!

Page 11: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

The New Rules of Engagement

Old Marketing New MarketingOne-Way Communication Brand is dialogueBrand recall is holy grail Customers determine brand value

Group customers by demographics Group customers by behavior

Content controlled by marketers Enterprise + user generated content

Virality driven by flash Virality based on contentMichelin Guide: Expert reviews Amazon: User reviews

Publisher controls channels Publishers build relationshipsTop-down strategy Bottom-up strategy

Information hierarchy Information on demand

Emphasis on cost - CPM Invest for growth - Measurable ROI

Page 12: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

New Media Measurement Model

Traditional Audience Research

Emerging Consumer Insight Focused

Demographics Behaviors, Interests

Impressions Engagement, Actions

Platform-Specific Campaign-Centric

Usage / Segmentation Purchase FunnelEstimate Census

Page 13: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Social Media =

Media (Duh!)

Page 14: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

"If I told you that I had a room full of current potential customers all talking about your products and your competitors, would you not show up? Not listening and then acting on social media chatter is like not showing up at all. The only thing worse is to have a presence in social media and only talk and not listen. It would be like showing up in the room with earplugs on." - Scott Stratten, “Unmarketing"

Page 15: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Holistic Digital Marketing

๏ Marketing + Media + Metrics (financial & marketing) + Automation = Holistic Data Driven Revenue Performance Management and Marketing

๏ Say what? This presentation aims to clarify. Stay sharp.

Page 16: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 17: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Future TrendsImportant global changes impacting marketing and media

Page 18: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

“In this new era, each of us must look carefully what we do and ask ourselves:

1. Can someone overseas do it cheaper?

2. Can a computer do it faster?

3. Am I offering something that satisfy the non-material, transcendent desires of an abundant age?

These three questions will mark the fault line between who gets ahead and who gets left behind.”

- Daniel H. Pink, "A Whole New Mind”

Page 19: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 20: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Future Trends๏ Mobile

๏ Metrics / Data / Performance Driven

๏ Globalization

๏ Long Tail Markets

๏ Permission Marketing

๏ Prosumers

๏ Crowd Sourcing

๏ Social

๏ Me-Conomy

๏ Abundance

๏ Agile / Lean / Data Driven

๏ Discovery

Page 21: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Mobile

๏ The new PC is in your pocket, not on your desk or lap

๏ Native apps are here to stay, not a fad

๏ Apps will unbundle existing complex services in separate tasks, “jobs to be done” in single apps

๏ Platforms not created equal, Apple != Android

Page 22: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Metrics / Data / Performance Driven๏ With the advent of digital media the possibilities of

measuring, recording and recording data exploded and the time and cost to producing, deploying and testing almost disappeared

๏ Demand for actionable metrics rising

๏ Demand for payment based on performance rising

๏ Actionable Data is king

Page 23: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Globalization๏ Don’t do yourself what someone overseas can do cheaper

๏ Overseas quality is getting better and better

๏ Source activities to overseas where it makes financial and strategical sense

๏ Don’t try to do it in-house just for spite, misplaced loyalty, fear or nostalgia

Page 24: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Long Tail Markets๏ When the cost of inventory storage (infinite shelf space,

negligible storage costs) and distribution (zero cost of reproduction, zero time to market) fall, a wider range of products become available.

๏ This can have the effect of reducing demand for the most popular products, offsetting the traditional distribution curve.

๏ The old marketing cost / benefit ratio of reaching niches versus popular “mainstream” no longer valid.

๏ Being found has negligible costs compared to old marketing way of pushing the product in front of a large enough audience to compensate for the cost of the reach.

Page 25: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 26: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Permission Marketing

๏ Interrupt marketing is dead - The consumers ignore it and hate it

๏ Pay, Spray & Pray is dead

๏ Permission marketing is the new order

๏ YOU. HAVE. TO. ASK. FOR. PERMISSION.

Page 27: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Prosumers๏ In the way every speaker is a microphone, in this digital day

and age, every consumer of content is a potential producer of content and a potential distributor of messages

๏ The funnel is flipped

๏ Marketers must enable the consumer to produce contend, buzz about the brand

๏ Every consumer now has the ability to reach the world in seconds, something only reserved for large corporations with large wallets in the past; play it real - Thoughtless marketing backfires

Page 28: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 29: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Crowd Sourcing

๏ Tasks that were once thought impossible can now be completed by the crowd (funding, wikipedia, mechanical turk, etc)

๏ Corporations can tap their consumer crowd in developing new products and services (e.g. Dell) and enabling fans to define their brands and become ambassadors

Page 30: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 31: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Social

๏ Broadcasting as we know it is dead dying: Get over it!

๏ Every medium is inherently social; Enable it!

๏ We want to share, it’s in our nature: Support it!

๏ Monologue has given way to dialogue: Embrace it!

Page 32: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 33: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Me-Conomy

๏ Personal Branding; You are the brand

๏ Reputation over talent

๏ Explicit self-packaging, curating

Page 34: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Abundance

๏ In a society that has an increasing abundance of commodities, brands must instill and support desires, social good, meaning and values

๏ Story-building more important than ever

๏ Transition to Branded Utility, Branded Meaning

Page 35: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 36: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Agile & Lean"Lean," is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. Working from the perspective of the customer who consumes a product or service, "value" is defined as any action or process that a customer would be willing to pay for.

“Agile” is a group of methodologies based on iterative and incremental development, where requirements and solutions evolve through collaboration between self-organizing, cross-functional teams. It promotes adaptive planning, evolutionary development and delivery; time boxed iterative approach and encourages rapid and flexible response to change. It is a conceptual framework that promotes foreseen interactions throughout the development cycle.

Lean (or Data Driven, Evidence Based) Marketing is coming - Embrace it.

"[Ad] Agencies are organized in a classical orchestra in a jazz age" - Rashid Tobacowala

Page 37: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Discovery

๏ The now is “search”

๏ The future is “discovery”

๏ In an age of abundance, I don’t need to search - I discover

๏ In the very near future, getting discovered by the consumers outside of search is the challenge

Page 38: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 39: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

What’s a Metric?A definition

Page 40: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Metric Definition“A metric is a measuring system that quantifies a trend, dynamic, or characteristic.In virtually all disciplines, practitioners use metrics to explain phenomena, diagnose causes, share findings, and project the results of future events. Throughout the worlds of science, business, and government, metrics encourage rigor and objectivity. They make it possible to compare observations across regions and time periods. They facilitate understanding and collaboration.”- David J. Reibstein, Neil T. Bendle, Paul W. Farris, Phillip E. Pfeifer “Marketing Metrics” Financial Times Press

Page 41: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Why Metrics?In recent years, data-based marketing has swept through the business world. In its wake, measurable performance and accountability have become the keys to marketing success. However, few managers appreciate the range of metrics by which they can evaluate marketing strategies and dynamics. Fewer still understand the pros, cons, and nuances of each.

In this environment, marketers, general managers, and business students need a comprehensive, practical reference on the metrics used to judge marketing programs and quantify their results.

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Page 43: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Data Driven Marketing Using metrics (data) to drive marketing

Page 44: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Data Driven Marketing

A senior marketing manager in a Fortune 100 company once told Mark Jeffery of Kellogg School of Management: “Every week I have to go to a gun fight, the senior executive leadership meeting, and I am tired of going to this gunfight carrying only a knife.” His frustration was the result of having no concrete data to answer hard questions about the value of marketing activities in his division.

We are living in difficult times, and marketing measurement and data-driven marketing are becoming increasingly important. Now more than ever, managers need to justify their marketing spending, show the value that they create for the business, and radically improve their marketing performance.

Page 45: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Data Driven Marketing

Why is data-driven marketing so difficult for many organizations? There are many reasons, ranging from “we don’t know how” to the challenge that branding and awareness marketing activities are fuzzy and don’t directly impact sales revenues in a short time period. The challenge is compounded by the exponential growth of data. International Data Corporation (IDC) estimates that data storage is growing at 60 percent per year, which suggests the volume of stored data is doubling approximately every 20 months.

These vast amounts of data are overwhelming and marketers struggle, with limited time and resources, to measure the efficacy of what they do. A few marketers and organizations, however, have mastered data-driven marketing principles and marketing metrics.

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Data Driven Marketing

Research demonstrates the existence of a divide between market leaders and laggards. A few statistics from research by Kellogg School of Management highlight the gaps in stark contrast:

๏ Fifty-three percent of organizations do not use forecasts of campaign ROMI, net present value (NPV), customer lifetime value (CLTV), and/or other performance metrics.

๏ Fifty-seven percent do not use business cases to evaluate marketing campaigns for funding.

๏ Sixty-one percent do not have a defined and documented process to screen, evaluate, and prioritize marketing campaigns.

๏ Sixty-nine percent do not use experiments contrasting the impact of pilot marketing campaigns with a control group.

๏ Seventy-three percent do not use scorecards rating each campaign relative to key business objectives prior to a funding decision.

Page 47: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Data Driven Marketing

These findings suggest that the majority of marketing organizations do not have professional processes in place to manage marketing and that most do not use marketing metrics in their day-to-day marketing activities. After all, if there is no business case or ROMI (described later) defined prior to campaign funding, how can you measure success after the fact?

The divide is even more pronounced when we look at marketing organizations’ use of data:

๏Fifty-seven percent do not use a centralized database to track and analyze their marketing campaigns

๏Seventy percent do not use an enterprise data warehouse (EDW) to track customer interactions with the firm and with marketing campaigns

๏Seventy-one percent do not use an EDW and analytics to guide marketing campaign selection

๏Eighty percent do not use an integrated data source to guide automated event-driven marketing

๏Eighty-two percent never track and monitor marketing campaigns and assets using automated software such as marketing resource management (MRM)

Page 48: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Data Driven Marketing

The vast majority of organizations therefore do not use centralized data to manage and optimize their marketing. The leaders, however, are on the other side of the divide and are the smaller percentage of firms, less than 20 percent, that actually do data-driven marketing and use metrics for measurement in their day-to-day marketing activities.

Why is there a marketing divide, and why is it so hard for organizations to do data-driven marketing? These statistics are symptoms of why data-driven marketing and marketing measurement are so difficult for many organizations: the internal processes do not support a culture of measurement, and they also do not have an infrastructure to support data-driven marketing and marketing metrics.

But beyond these high-level processes, most marketers are overwhelmed with data and do not know where to start in terms of measuring the right things to drive real results. Furthermore, 55 percent of managers report that their staff does not understand metrics such as NPV and CLTV.

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A Data Driven Marketing Framework

Priv

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Met

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Know Yourself Know Your Customer

Segment Your Customer

Data Driven Marketing Build Trust Keep Score

Page 50: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

A Data Driven Marketing Strategy

Enterprise Data Warehouse

Reporting

OLAP

Data Mining

Marketing

Sales

Cust. Service E-C

omm

erce

Analysis Communication, Personalization

Analysis Modelling

Personalization

Communication

Optimization Interaction

Data Driven Marketing

CRMFront-OfficeOperational

Business Intelligence

Page 51: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

A Data Driven Marketing Roadmap

STEPS

ELEMENTS

BENEFITS

!Objectives Alignment Scope Metrics Hypotheses !!!!!

!Balance Risk Returns !!!!!!!

!Quick Hits Emergencies Adjustments !!!!!!!

Metrics Formulas Models Templates Dashboards !!!!!

!Weekly Monthly Quarterly Annually !!!!!!

1. Design

2. Diagnosis

3. Opportunities

4. Tools

5. Process

Clear game plan understood and bought into by future audiences

Facts and insights for effective decision making

Findings translated into specific opportunities for action

Installed capabilities for recurring review

Recurring reviews, input into decision making

Page 52: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

"The thing that gets me really riled up about people questioning the ROI of social media is: If I offered you a tool 10 years ago that allowed you to listen and respond to the casual conversations of your potential, current, and past customers, you would have paid me $20,000 a month for this 8th wonder of the world. But now, that it is here, and its free, you question its value? This is why I get ulcers. It’s like extremely smart business people become temporarily dumb; it baffles my mind." - Scott Stratten, “Unmarketing"

Page 53: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

15 Essential Marketing Metrics

The 15 essential metrics for marketing defined by Mark Jeffery at the Kellogg School of Management are:

1. Brand awareness

2. Test-drive

3. Churn

4. Customer satisfaction (CSAT)

5. Take rate

6. Profit

7. Net present value (NPV)

8. Internal rate of return (IRR)

9. Payback

10. Customer lifetime value (CLTV)

11. Cost per click (CPC)

12. Transaction conversion rate (TCR)

13. Return on ad dollars spent (ROA)

14. Bounce rate

15. Word of mouth (WOM) (social media reach)

Page 54: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

The 5 Essential Digital Marketing

Metrics1. Cost per click (CPC)

2. Transaction conversion rate (TCR)

3. Return on ad dollars spent (ROA)

4. Bounce rate

5. Word of mouth (WOM, Social Media Reach)

Page 55: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Cost Per Click (CPC)

๏ The essential search engine marketing metric

๏ CPC = Cost per click on a sponsored search link or banner advertisement

Page 56: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

TCR

๏ The essential metric connecting internet clicks to money

๏ TCR = Transaction Conversion Rate; The percentage of customers who purchase after clicking through on a website

Page 57: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

ROA

๏ The essential return on internet search marketing metric

๏ ROA = Return on Ad Dollars Spent = Net Revenue / Cost

Page 58: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Bounce Rate

๏ The essential web site performance metric

๏ Bounce Rate = Percentage of customers who leave a website after spending less than five seconds on it

Page 59: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

WoM Social Media Reach๏ The essential metric for word of mouth on the Internet

๏ WOM = Word of Mouth

๏ WOM = Number of direct clicks + number of clicks from recommendation / number of direct clicks (one example)

Page 60: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Funnel Metrics & Cohort (Group) Analysis

The best kind of per-customer metrics to use for ongoing decision making are cohort metrics. For example, consider an e-commerce product that has a couple of key customer lifecycle events: registering for the product, signing up for the free trial, using the product, and becoming a paying customer. We can create a simple report that shows these metrics for subsequent cohorts (groups) over time. Let’s say we create a weekly report. For each week, we then report on what percentage of customers who registered in that week subsequently went on to take each lifecycle action. If these numbers are holding steady from cohort to cohort, then we get clear feedback that nothing significant is changing. If one suddenly shifts up or down, we get a rapid signal to investigate. !The best thing about funnel metrics is that they allow you to boil down a large amount of information into a handful of numbers. If you don’t have the software to build these reports automatically, consider doing it by hand. !This is easy to do if the number of conversion events in relatively small — even if the number of customers is very large. For example, a typical website will have a 1% registration-to-purchase conversion rate. So even if you are registering 1000 new customers every day, those customers are going to result in something like 10 new purchases over their lifetime. So instead of getting fancy, use the good old index cards. At the end of each day, create an index card with that day’s date on it and the number of people who registered that day. Then, for each conversion that comes in, make a tally mark on the index card of the date that the person registered, not the date they purchased. For most products, this only requires you to maintain a week or two’s worth of index cards, since most products have customers that make purchase decisions relatively quickly. Then, on a weekly or monthly basis, gather up all the cards for a given cohort, and compute the conversion rate of the customers who registered in that period. That’s the number you want to focus on driving up.

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One More Thing A new essential metric to consider

Page 62: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

ROMIReturn on Marketing Investment Return on marketing investment (ROMI) is a relatively new metric. It is not like the other “return-on-investment” metrics because marketing is not the same kind of investment. Instead of moneys that are “tied” up in plants and inventories, marketing funds are typically “risked.” Marketing spending is typically expensed in the current period. !There are many variations in the way this metric has been used, and although no authoritative sources for defining it exist, the consensus of usage justifies the following: The idea of measuring the market’s response in terms of sales and profits is not new, but terms such as marketing ROI and ROMI are used more frequently now than in past periods. Usually, marketing spending will be deemed as justified if the ROMI is positive. !Purpose: To Measure the Rate at which Spending on Marketing Contributes to Profits Marketers are under more and more pressure to “show a return” on their activities. However, it is often unclear exactly what this means. Certainly, marketing spending is not an “investment” in the usual sense of the word. There is usually no tangible asset and often not even a predictable (quantifiable) result to show for the spending, but marketers still want to emphasize that their activities contribute to financial health. !Some might argue that marketing should be considered an expense and the focus should be on whether it is a necessary expense. Marketers believe that many of their activities generate lasting results and therefore should be considered “investments” in the future of the business.

Page 63: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

ROMI

๏ ROM = Return on Marketing Investment

๏ The contribution attributable to marketing (net of marketing spending), divided by the marketing “invested” or risked.

Page 64: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

ROMI Example

Page 65: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

A ROMI FrameworkSen

sitivi

ty Ana

lysis

ROMI Im

pact

Upside

Costs

Base

Case

Busine

ss

Discove

ry

Business Discovery: Market research and analysis to understand the existing business and impact or the potential marketing campaign or new product launch.Base Case: Define the existing market sales, cost and net cash flows resulting from existing marketing and/or product sales.Costs: Define all costs of the new marketing campaign or product launch. These costs include pre-launch marketing, contact costs, new product development and on-going marketing, customer service and product maintenance costs.Upside: The upside revenue impact of the new marketing initiative or new product.ROMI Impact: The NPV, IRR and payback calculated from the incremental cash flows - the subtraction of the Base Case and Costs from the Upside.Sensitivity Analysis: Vary the assumptions in the model to define the best, worst and expected cases.

Page 66: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Further Reading

http://goo.gl/zd6dY http://goo.gl/Nu6bu http://goo.gl/wxSwK http://goo.gl/ZHX2G http://goo.gl/hIoPC

Page 67: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Vanity MetricsNon-actionable metrics that will only make you feel good

Page 68: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Vanity Metrics"[...] most analytics packages are configured by default to provide mostly reports on vanity metrics. That makes sense, since they are the easiest to measure and they tend to make you feel good about yourself. The only metrics that [you] should invest energy in collecting are those that help them make decisions." - Eric Ries

How do we know that we are actually affect change in the metrics that we're observing? This is the curse of vanity metrics, numbers which look good on paper but aren't action oriented: website hits, message volume, or "billions and billions served." They look great in a press release, but what do they accomplish?

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Actionable MetricsUsing the scientific method to acquire and audit data

Page 70: Comprehensive Digital Marketing - A Primer on Data Driven Marketing
Page 71: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

Actionable Metrics

All metrics should be:

๏ Actionable

๏ Accessible

๏ Auditable

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Actionable

When someone reads a report about a specific metric, it's essential that they have some idea how to replicate the result in the report. Techniques like split-testing, where discrete groups of customers see different versions of the product, are the gold-standard here. Following the scientific method gives confidence that the observed behavior was, in fact, caused by the change being tested.

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AccessibleMost data warehousing systems provide reports that are too complicated to read and take too long to generate. As a result, many teams don't get any benefit out of them. In order for reports to be worthwhile, it's essential that:

๏ Everyone in the company understand how to read them

๏ Everyone in the company has easy access to the latest data

Additionally, to keep accessibility high, the feedback loop between taking an action and seeing the results should be as short as possible. In experience, waiting for even a weekly round-up or having to ask a data warehousing expert to run a report creates too much friction. Key data should be available to everyone, anytime, in a matter of minutes. In order to achieve that goal, the reports themselves have to be extremely simple.

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AuditableThe biggest benefit of actionable metrics is that they can be used to reap the biggest savings in all of product development, when they tell you that you don't need to do something. Metrics have to be credible to the people who drive the product vision, including company founders. Even if they understand a report, and know what caused it, that doesn't mean they will actually learn. Is the report accurate? When it's your idea on the line, it's much easier to believe the report is the problem rather than the idea.

Thus, it's important that skeptics can audit a report. When possible, this should mean that report generation is simple. Hopefully it can be created with direct access to primary data. For example, a report about revenue that's generated directly from the customer’s master orders database is more credible than one that requires several intermediate steps. Most importantly, it should be possible to translate the summary numbers in the report back to the actual customers who generated them.

Remember, metrics are really reports on people. This is where most off-the-shelf metrics packages fail. For example, consider a report that claims in a split-test between two proposed features, feature A generated more revenue than feature B. Which people used feature A? Which people used feature B? Can a skeptic call them up and ask them questions about their use of each feature? If not, how can we generate actionable insights about what to test next? Or consider a report that reports abstract quantities, like website hits or attrition rates. These are hard to visualize. But if instead our metrics say a sports stadium full of people declined to buy our product. Ouch! We can all relate to that.

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How to Gather Actionable Metrics๏ Do A/B split tests

๏ Get per-customer metrics data

๏ Get funnel metrics and do cohort analysis

๏ Do keyword (SEM/SEO) metrics

Page 76: Comprehensive Digital Marketing - A Primer on Data Driven Marketing

A/B Split TestsA/B experiments produce the most actionable of all metrics, because they explicitly refute or confirm a specific hypothesis. Either way, you can use split-tests to take action on anything from minor copy tweaks to major changes in the product or its positioning. However, not all split-tests are created equal. There is some value in the linear-optimization type tests that are a useful tactic in growing conversions. But the real value of split-tests comes when you integrate them into your decision loop: the process of putting your ideas in practice, seeing what happens, and learning for your next set of ideas. The tests that drive the most learning are the ones to focus on. A good rule of thumb is to ask yourself, “if this test turns out differently from how I expect, will that cast serious doubts on what I think I know about my customers?” If not, try something bigger.

Good third-party tools for A/B testing are hard to come by — most are too complex for most situations. If you don’t have an A/B system, you can use Google Website Optimizer or — if you have a software development team — build your own.

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Per-Customer MetricsIt’s important to remember, “Metrics are people, too.” Vanity metrics tend to take our attention away from this reality by focusing our attention on abstract groups and concepts. Instead, take a look at data that is happening on a per-customer or per-segment basis. For example, instead of looking at the total number of pageviews in a given month, consider looking at the number of pageviews per new and returning customer. Those metrics should be relatively constant — unless something interesting is happening with your product. So even a big rush of new customers shouldn’t change how many pages they each view on average, unless you’re getting a new kind of customer. !Similarly, if you’re increasing the engagement of customers with your [marketing], that will tend to show up in the data for the returning customers. But if you just look at their aggregate data, you can miss important trends. The following pattern is often observed: a big spike of customers joins thanks to a mention on a prominent web site. If a product has an average customer lifetime of two months, then after that period elapses, a huge number of customers can be expected to churn out all around the same time. But these effects are hard to keep track of, since customers are coming and going all the time. If you focus only on the number of page views, even if you limit it to returning customers, you might mistake a positive product change for something negative, because you launched it during a churn-dominated period. !Many analytics packages, including the much-maligned Google Analytics, have the ability to break down aggregates into per-customer or per-segment analyses. These can help make reports more actionable if you combine them with the Goal Tracking feature. For example, if you can tell which web referrers are driving the most traffic, that’s moderately useful. But if you can tell which are driving the most conversions, then you can start to make ROI-based decisions on where to invest your time in getting more traffic.

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Metrics Conclusion1. Measure what matters

2. Metrics are people too

3. Measure the macro

4. Be agile, build-measure-learn in small batches

5. Apply scientific method to avoid Vanity Metrics

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Measure What Matters

It’s tempting to think that, because some metrics is good, more metrics is better. That’s why vendors routinely list the thousands of reports they are capable of generating as a feature. The truth is, the key to actionable metrics is having as few as possible. Detailed reports are useful when we’ve diagnosed a problem and are looking for clues as to what’s gone wrong. But where does that diagnosis come from in the first place? Actionable metrics help us realize we have a problem and point us in the right direction to start solving it.

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Metrics are People too

Great metrics tools allow us to audit their accuracy by tracing reports back to the individual people who generated their data. This improves accuracy, but its more important effect is that it lets us use the same customers for in-depth qualitative research.

Not sure what the numbers mean? Get the customers on the phone and ask them.

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Measure the Macro

Even when we’re split testing the impact of a minor change, like a wording or a new button, it’s important not to get distracted by intermediate metrics like the click-through rate of the button itself. We don’t care about click-through rates, we only care about the customer behaviors that lead to something useful, whether purchase, retention for advertising CPM, or some other measurable “success” particular to your business model.

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Agile Marketing

๏ Using near-time data to improve performance

๏ Learning by failing and failing fast

๏ Designing for measurement

๏ Build-Measure-Learn & Repeat

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Metrics: Conclusions

You want to define goals up front and institute a systemized and relevant way of capture all the relevant meaningful data you can get to measure the performance of those goals, beware of privacy concerns and sensibilities, don´t get caught up with vanity metrics; Shit in = shit out.

Metrics means serious business, influencing yours and the customer´s bottom line. Consider data gathering and metrics analysis core to anything you do in marketing.

You do not want to be doing metrics and analysis by hand or with self made systems over time. You will need automation, processes and tools.

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Marketing AutomationA definition

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Marketing Automation

๏ Marketing Intelligence

๏ Marketing Automation

๏ Advanced Workflow Automation

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Marketing Intelligence

Tracking social media, email and webpages to record the behavior of anyone interested in a product or service to gain a measure of intent.

It can record which social media group or thread they followed, which link was clicked on in an email or which search term was used to access a website.

Multiple link analysis can then track buyer behavior - following links and multiple threads related to product A but not B will show an interest only in A.

This allows more accurately targeted response and the development of a nurturing program specifically targeted towards their interest and vertical market.

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Marketing Automation

Lead generation with targeted marketing programs to drive awareness and interest in a company's products and/or services and nurture leads from first interest through to sale.

Marketing Automation involves multiple areas of marketing and is really the marriage of marketing technologies coupled with a structured sales process as facilitated by e.g. CRM software.

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Workflow Automation

Automation of internal marketing processes. These includes budgeting and planning, workflow and approvals, the marketing calendar, internal collaboration, digital asset creation and management and essentially everything that supports the operational efficiency of the internal marketing function.

Typically these systems are used to set up a complex series of rules in software systems to trigger action items for internal sales and marketing professionals to process.

This type of system increases marketers ability to deliver relevant content to relevant individuals at relevant times.

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An Inbound Marketing Automation System

SEO’d Website

Your Visitors

Software SystemsYour Content

SocMed Marketing

Tools

SEO/ PPC Tools

CRMMarketing

Automation Software

Reputation/Visitor/Prospect/Client Database

Inbound Marketing Automation is a process consisting of a set of tools and using them with specific techniques.

To gain maximum benefit it’s best to consider the process as a way to tie them all together and thus ensure that the whole system is greater than the sum of its parts.

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Demand GenerationAn introduction

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http://youtu.be/5sXPZ8CfIwo

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Demand vs Lead Generation

๏ Sounds familiar? Same, same but different

๏ Lead Generation = Focus on sales

๏ Demand Generation = Focus on awareness, “why should I buy this?” “why should I care?”

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Demand GenerationTargeted marketing programs to drive awareness and interest in a company's products and/or services.

Demand generation involves multiple areas of marketing and is really the marriage of marketing programs coupled with a structured sales process.

There are multiple components of a stepped demand generation process that vary based on the size and complexity of a sale. These components include: building awareness, positioning relevance, supporting validation and mitigating customer evaluation.

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Demand Generation

๏ Building Awareness

๏ Facilitating Discovery

๏ Guiding Solution Validation

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Building AwarenessThe demand generation function in most businesses resides as part of the marketing organization. Demand Generation is a holistic approach to marketing and sales cohesiveness within the company. Building awareness is a vital component in the demand generation process. Building awareness often takes a continued effort and involves multiple facets of marketing.

Advanced demand generation programs typically rely on some form of proactive Lead Generation activities supported by more traditional market programs and processes:

๏ Branding

๏ Inbound Marketing: Search Engine Optimization, Viral Marketing, Social Media Marketing, Email Marketing, Pay Per Click Marketing

๏ Outbound Marketing: Inside Sales/Telemarketing, Outsourced Lead Generation, Outsourced Appointment Setting

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Facilitating Discovery

The second key area of focus for a marketer focused on demand generation is ensuring that when a prospect decides to seek a vendor to provide a solution in a given solution category, they discover the vendor that the marketer serves. This is again accomplished with a variety of techniques and tools, often overlapping with the tools used for creating awareness of the category, but with a different emphasis. !In this phase of the demand generation process, many approaches and tools are used and this list is only a selection of the more common approaches.!

๏Search Engine Marketing – the purchase of advertisements on search engines to appear when keywords on the specific category, or known competitors in the solution space, are searched for.

๏Search Engine Optimization – the use of a variety of techniques to increase a web site’s natural position in search engine results when keywords on the specific category, or known competitors in the solution space, are searched for.

๏Webinars or Seminars – online web based seminars, or in person seminars to allow prospective buyers to discover and understand a vendor’s solution, how it can be used, and who else is using it, in detail

๏Demonstrations and Free Trials – easily accessed, often online, tools for demonstrating a solution or accessing a time-limited or feature-constrained trial version to assist prospective buyers in discovering the solution and its fit with their need

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Guiding Solution Validation

Often confused with Demand Generation is the lead process itself. Converting demand into sales is a totally separate task. Many companies, however, will call themselves Demand Generation organizations when they are really lead generating.!This later phase of the buying process involves validating that a selected vendor will meet specified requirements, coming to an agreement with the vendor on costs, contract terms, support and services, and finalizing the purchase process.!This often involves coordinating the involvement of other organizational and extra-organizational resources such as sales representatives and reference clients.!

๏ Marketing Tools as previously described – trials, demonstrations, white papers, and seminars designed for a more detailed evaluation and validation of the solution in question

๏ Reference Management – cultivation, management, and selection of client references willing to provide a potential purchaser with the perspective of a current (or past) client.

๏ Sales Involvement – coordination of the right sales resource to interact with the prospect to navigate the final stages of the buying process including contract negotiation, legal terms and conditions, and sign-off

!The coordination of sales involvement, the selection of the right sales resource, and the timing of the involvement can be difficult to determine. The scoring, ranking, and routing of leads into sales is a sufficiently deep topic to warrant further exploration.

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Revenue Performance ManagementAn introduction to holistic data driven marketing automation

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Holistic Data Driven Marketing

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http://youtu.be/00lLpJgTk2Q

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http://youtu.be/2zTMaJlv764

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System Vendors

๏ LeadFormix

๏ Eloqua

๏ eTrigue

๏ Genoo

๏ Pardot

๏ Neolane

๏ Net-results

๏ Silverpop

๏ Optify

๏ Alsamarketing

๏ Bulldog Solutions

๏ Manticore Technology

๏ LoopFuse

๏ Market2lead

๏ True Influence

๏ Marketo

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Inbound Marketing Automation System

1. SEO/PPC. Search Engine Optimization and Pay-Per-Click. There tools help you to design your Keyword strategy; others tools assist in developing your advertising campaigns, analyze your website’s traffic share, score it for SEO value, determine your SERP (Search Engine Results Page) ranking, and assess its Domain and Page Authority (the number and value of your incoming and outgoing links), etc.

2. Social Media Marketing software tools. Reputation Analytics monitor the social networks to determine the “buzz” around your products/services and company. These tools also help you to find the most authoritative or influential blogs and websites for your area. There are tools to help with Twitter, Blogging, LinkedIn and all of the many social media platforms and because this is a hot topic, there are many articles on how and what and when. Our blog covers the subject well

3. Content. The whole process depends on having content that makes your site the destination of choice for people interested in your field. Tools here help create it, display it, disseminate, and promote it. Our blog offers some ideas on how to create such content.

4. Marketing Automation packages track, score and grade visitors on their profiles and digital footprints (their activities on site), and then nurture them from cold leads to hot prospects via drip-email campaigns run via Automation Rules.

5. The hot prospects (those who achieve a sufficiently high score) are fed into your CRM system enabling your sales people to place very effective sales calls

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http://youtu.be/evL5jaZx8vk

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Digital Marketing ThinkersSome of the most influential and interesting people to watch

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Seth GodinSpeaker, Writer & ThinkerPermission Marketing, How to be Remarkable!!!http://www.sethgodin.com

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Jeremiah OwyangStrategist & AnalystPrevious Senior Analyst at ForresterAltimeter Group!!http://www.web-strategist.com/blog/about/

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Brian SolisWriter & New Media Strategist!!!!http://www.briansolis.com/about/

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Dan ZarellaThe Social Media ScientistHubspot!!!http://www.danzarella.com/bio

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Jim SterneWriter, Speaker & ThinkerThe Granddaddy of Web Metrics!!!http://www.targeting.com/about/about-jim-sterne.html

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Chris BroganAuthor, Thinker & SpeakerInfluence, Trust & Reputation!!http://www.chrisbrogan.com/about

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Scott StrattenWriter, Thinker & SpeakerInventor of “Unmarketing”!!!http://www.unmarketing.com/about

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Shel HoltzConsultant, Writer, Thinker & SpeakerCorporate Communications & PR!!!http://www.holtz.com/about

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David ArmanoExecutive Vice President, Global Innovation & Integration, Edelman Digital!!!http://www.about.me/david_armano

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Brent D. PayneSEO, SEO, SEO!!!http://www.brentdpayne.com

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Joseph JaffeWriter, Marketer, Thinker & SpeakerFlip the Funnel!!http://www.jaffejuice.com/about-joseph-jaffe.html

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Mitch JoelWriter, Thinker & SpeakerDigital Marketing and Media Hacking!!http://www.twistimage.com/about-mitch/

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Eric GoldmanCEO of GossamarInbound Marketing Automation!!http://www.inbound-marketing-automation.ca/blog/

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“Skate to where the puck is going to be, not where it has been.” - Wayne Gretzky

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Players to WatchA list of interesting potential partners

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Players to Watchhttp://www.demandgen.com/ http://4thoughtmarketing.com/ http://www.astadia.com/ http://www.bnj.com/ http://www.b1.com/ http://www.bluewolf.com/ http://www.bulldogsolutions.com/ http://www.catapultworks.com/ http://clever-touch.com/ http://www.couch-associates.com/ http://www.edynamic.net/ http://www.evariant.com/ http://www.extraprise.com/ http://www.foxps.com/ http://harlandclarke.com/ http://www.echo-lane.com/ (Hi-Soft) http://www.ibis.com/ http://www.increase.dk/ http://www.kerensen.com/ http://cloudforce.leadfabric.com/ http://www.adcloud.de

http://www.leftbraindga.com/ http://www.marketingdecisions.com.au/ http://www.marketone.com/ http://www.meclabs.com/ http://www.quarry.com/ http://www.relationshipone.com/ http://www.relationshipone.com/ http://www.rivetglobal.com/ http://www.sqwarepeg.com/ http://www.televerde.com/ http://www.thekernorg.com/ http://www.crmtechnologies.com/ http://www.verticurl.com/ http://www.demandbase.com/ http://www.dialogue.net/ http://www.lithium.com/ http://www.salesforce.com/ http://www.sureshotmedia.com/ http://www.strikeiron.com/ http://www.netsuite.com/ http://www.omniture.com/en/ http://www.webtrends.com/

http://www.ignitiongroup.com/ http://www.hubspot.com/ http://www.altimetergroup.com/ http://www.radian6.com http://www.sysomos.com/ http://www.infospeed.de/ http://www.alterian.com/ http://www.eloqua.com/ http://www.pardot.com/ http://www.seomoz.org/ http://www.kissmetrics.com/ http://www.buddymedia.com/

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Digital Marketing AgenciesA diverse list of international and national players to watch

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Digital Marketing Agencies

http://www.goldbachgroup.com/ http://www.h2omedia.de/ http://www.razorfish.com http://www.neue-digitale.de http://www.jvm-neckar.de http://www.argonauteng2.de http://www.fork.de/ http://www.saatchi.de/ http://www.goodbysilverstein.com/ http://www.barbariangroup.com/ http://www.edelmandigital.com/ http://www.360i.com/ http://www.marketone.com/ http://www.marketingdecisions.com.au/ http://www.inbound-marketing-automation.ca/

http://www.brainrider.com/ http://www.epicom.com/ http://www.audaxium.com/ http://www.annuitasgroup.com/ http://www.b1.com/ http://breakfastny.com/ http://www.hugeinc.com/ http://firstborn.com/ http://www.victorsandspoils.com/ http://www.kolle-rebbe.de/ http://www.pixelpark.com/ http://www.plan-net-group.com/ http://www.akqa.com/ http://www.idmediacologne.de/ http://www.prosiebensat1.de/ http://www.ogilvyone.de/

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What’s next?Vidar [email protected]+4915140133149