Methods to Measure Marketing & The Metrics We Move
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Transcript of Methods to Measure Marketing & The Metrics We Move
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Methods To Measure Marketing & The Metrics We Move
By Dean LevittFounder
Teacup Analytics
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Who Am I?A curriculum vitae of sorts
• Born and raised on a farm in South Africa, near Johannesburg
• Built Mad Mimi, acq. by GoDaddy in 2014 and was on the team that built GoDaddy
Email Marketing
• Previously Chief of Culture for Mad Mimi & Director of Online Support for GoDaddy
• Founder of Teacup Analytics
• I currently live in Tel Aviv, Israel
• I run, surf and travel
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What Is Teacup Analytics?Teacup Analytics Simplifies Google Analytics for Small Businesses
• Launched in March 2016
• Teacup Analytics makes Google Analytics data simple and understandable
• Library of over 30 analyst-crafted reports
• Innovative grading system that qualitatively analyzes web traffic quality
• Monitors the impact that actions have on performance
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The Plan For This WebinarJust what will we be talking about?
• We’ll be covering 4 areas of measurement:
1. Selecting the right metrics to monitor
2. Understanding long-term impact
3. Reporting – what makes a report insightful
4. Catching problems and fixing them, quickly
• And a quick primer on the best analysis concept!
• We’ll be focusing on marketing, specifically, “web marketing”
• I use Google Analytics for data but these concepts apply agnostically
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A Tiny GlossaryYou probably already know this but…
• Goals – A goal is a desired activity that a site visitor might take
• Conversion – When a site visitor completes an activity (a goal)
• Channel – This is a source of web traffic e.g. Organic search, social media, referral
• Action – Something the business does to grow or improve their site experience
• Analytics – The discovery and interpretation of data
• Data - Individual pieces of information
• Analysis – The process of breaking a complex topic into smaller parts to better
understand it
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Let’s Pick The Right Metrics To Measure
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The Right Data To MeasureBusiness goals define the right data
• First, define what your business goals are
• Understanding data first requires an understanding of what you want to achieve
• Define a clear point of success, a line in the sand, a flag to capture!
• Think granular – what is the main indicator that defines success for your business?
• It could be more sales, more revenue or more customer referrals
• Defining the business goal first saves you from vanity metrics!
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The Story of Andrea B. and The Very Wrong Vanity Metrics
Goal: Sell more online
Strategy: Google AdWords
Metrics tracked: Clicks, CTR, Conversions
Should have tracked: Sales, Revenue per visit, ROI
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The Right Data To MeasureBusiness goals define the right data
• Having defined your business goal, define the various dimensions and metrics that
indicate success.
• These are your KPIs: Key Performance Indicators
• Less is more! The more you track at this level, the more you encourage paralysis by
analysis.
• I believe 3 to 5 metrics is plenty to track at this level
• Combine quantitative metrics with qualitative metrics…
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The Right Data To MeasureBusiness goals define the right data
• Quantitative metrics are easy and give often false impressions:
• How many sales each month
• How many clicks on ads each day
• How much traffic each week
• Quality adds the context and explains whether those clicks, sales or traffic is good!
• Qualitative metrics are:
• Revenue per transaction
• Conversions (and other engagement metrics)
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The Right Data To MeasureBusiness goals define the right data
• Combining both quantitative metrics and qualitative metrics tell you the real story.
• Together they indicate your supporting actions:
• Grow - low quantity, high quality
• Optimize – high quantity, low quality
• For now, just remember that KPI’s need both.
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Ongoing Impact
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Ongoing ImpactDo my actions result in real, long term improvements?
• Most marketing efforts and optimizations have immediate impact but when can you
declare success?
• The best growth efforts pay dividends over the long term
• To demonstrate real impact, don’t do this:
• Sales last month were 50 units, this month they’re 55 units
• Instead think like this:
• This action has raised our average weekly sales by 10%
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Ongoing ImpactDo my actions result in real, long term improvements?
1. Pick a time period, for example 3 months
2. Find the average for all metrics for those three months - this is your baseline
3. Then, each week, or month, you can compare results to your baseline
4. At the end of a similar time period, if your new average is higher, you can state, with
certainty, that your efforts worked!
• But is it statistically significant? Here’s a simple trick to find out:
That’s it!
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Ongoing ImpactDo my actions result in real, long term improvements?
• Calculate the standard deviation of the time period before you acted*
• If your new average is higher than your previous average + std. deviation then you
had a serious, long term impact on your business.
• This indicates your new average beats the ordinary ups and downs of what you’re
tracking.
• This isn’t exactly statistically significant but it’s simpler • What it really means is this:
Tip: just use an online calculator if you're not sure of the formula.sd = √∑((xi – µ)2/(N – 1))
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Our efforts resulted in significant, long term term improvement!
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Reporting The Right Way
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Reporting The Right WayHow much should you monitor and share?
• Remember those business goals? Regular report needs to focus on business goals!
• Include metrics that inform your performance relative to those goals
• Answer questions like…
• Are we reaching the business goals?
• Why are we so sure?
• These channels are where the successes come from
• Those channels need optimization
• Only report metrics you’re willing to act upon!
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Reporting The Right WayHow much should you monitor and share?
• Segmentation should only occur in secondary reporting
• Segment when trying to answer follow-on questions like:
• Why is this not working?
• Where can we improve?
• By including these in the primary report, you’ll confuse the issue and likely end up
looking at vanity metrics
• Quantitative metrics need qualitative metrics to add context
• Segment, only when you’re willing to act!
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Changing Course
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Making A ChangeWhen should you change the course of action?
• As always, give your actions time to work
• Monitor both quantitative and qualitative metrics together
• When quantity rises, quality can end up dropping – watch out:
• Don’t consider large amounts of bad traffic to be a success!
• If quality does drop, dive into intent!
• Segment by channel or source
• Also, review visitor experience
• Segment by device
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Making A ChangeWhen should you change the course of action?
• If quantity drops, despite marketing investment
• It’s often technical – review tracking setup
• Consider quantity – you could be simply attracting the right audience and still
achieve your business goals
• If quantity and quality both disappoint, it’s time to reconsider the whole strategy
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A Very Brief Primer on Analysis
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
• Action 1: Do nothing!
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
• Action 1: Do nothing!
• Volume is insignificant and results are poor
• Not worth time and effort
• Too hard to make an impact with current resources
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
• Action 1: Do nothing!
• Action 2: Optimize!
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
• Action 1: Do nothing!
• Action 2: Optimize!
• Traffic volume is significant but conversions suck i.e. low quality
• This is a leaky bucket, with holes you should plug before adding water
• You’re optimizing for conversions, and not worrying about volume
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
• Action 1: Do nothing!
• Action 2: Optimize!
• Action 3: Grow!
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
• All analysis boils down to three possible actions
• Action 1: Do nothing!
• Action 2: Optimize!
• Action 3: Grow!
• Channel volume is low but has great conversion rates, i.e. high quality
• Ripe for growth because the bucket is water-tight
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
Results
ActivityLow High
Below
Above
GrowthOpportunity
OptimizationNeeded
The Do-Nothing Zo
ne
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Easy Analysis and ActionThe quickest way to find actionable insight with clients
Results
ActivityLow High
Below
Above
Direct: B
Organic search: A+
Referral: A
Paid Search: B
Email: A
Social: D