If you are one of those marketers that rush to check their analytic reports after sending a campaign, you might be missing a trick. This is because the process of successfully analyzing your marketing activities starts long before a campaign is actually sent.
Before you should start looking at your analytics, you need some context. That context starts with an objective because without that objective, your reports are just a load of meaningless data.
We’ve talked a lot about the importance of setting objectives before on this blog. But for those in need of a refresher, objectives give marketers something to measure the success of their campaigns against accurately.
It’s always useful to measure simple metrics like email marketing open rates, click-through rates, conversions, etc. against historic data but as you mature as a marketer, you’ll want to be more sophisticated in your approach.
Modern Marketing
In modern marketing, it’s important to understand how individual marketing strategies influence and assist each other. It’s only when you collate this data that you can really understand your true return-on-investment across your entire marketing portfolio.
For example, a paid search campaign might show a terrible return on investment when compared to a much more profitable email marketing campaign. However, when you understand that when your all-important Customer Lifetime Value (CLV) was initiated with a loss-leading click on a search campaign, your paid search campaigns no longer seem so expensive and your email marketing activities so all conquering.
Careful analysis of your marketing reports will help break individual marketing channels out of their silos and give you a much better understanding of the success of your entire marketing strategy.
Essential Metrics
There are a couple of metrics every marketer should be fully aware of — these include:
- Cost of acquisition: The cost of acquiring a customer or a lead. Because not all customers will generate a profit immediately, it is important to target those expensively acquired customers with more efficient retention marketing strategies like email and social media marketing. In the perfect world, you’ll only pay acquisition rates to acquire a customer once. In reality, too many marketers pay to acquire the same customers time after time. If you are in the business of generating leads for your sales team, you may wish to assign a value against each lead generated. When you understand the value of a lead, you can more accurately understand how much you need to pay to acquire each lead.
- Customer Lifetime Value (CLV): The average amount of money a customer will spend with your business over their lifetime as a customer. Nobody wants to think about losing customers but churn is an inevitable part of business. By understanding how long customers typically stay with your organization and their average spend, you can start to optimize your marketing activities around their habits. For example, if the average customer stays with your business for three years, you better make sure that you maximize the potential of those marketing touchpoints within that estimated timeframe.
Only when you understand your cost of acquisition and CLV, can you understand how much time, money, and effort you should invest in your marketing strategy before taking additional steps to optimize the marketing process. When you have this information in hand you can then set objectives in terms of customer acquisition, revenue and profits with a degree of certainty.
Testing Times
All marketing strategies benefit from testing and careful analysis.
Here’s where it gets difficult.
As you tweak individual marketing channels, this will have a knock on effect on all your other channels. Spend more money on paid search and your email lists will grow. Cut back on your paid search and increase your email activities and you’ll most likely enjoy a temporary uplift in profits, until email fatigue and those dreaded unsubscribes impact the quality of your lists.
In this respect, you can think of adjusting your marketing mix like controlling the flow of hot water in a hotel shower. It can be a bit hit and miss. In reality, it’s about identifying trends and optimizing accordingly. This makes analysis all the more difficult for marketers who don’t have access to historic data.
Benchmarking
Benchmarked data always makes me feel nervous. When you compare campaign success against previously produced data or judge your success on widely published competitive data, you might be selling yourself short. This is because these benchmarked stats might have been produced outside of marketing best practices.
Regardless of how well managed your marketing campaigns are, you should always strive for improvement through a campaign of optimization. When you are starting from the ground up, this should be fairly easy. But as your campaigns advance, you may find yourself looking for marginal gains — a fraction of a percentage here, a fraction of a percentage point there. As your business scales, these marginal gains can represent a significant return.
Big Data
The big problem that many marketers face is that they don’t have a single view of the truth relating to all the campaign activities. The data from their paid search activities is often held completely separately from their email marketing data. In worst case scenarios, these two marketing channels actually compete with each other. It shouldn’t be this way.
In a perfect world, your MarTech stack will be 100% aligned and your data will demonstrate how each channel impacts the entire customer journey.
In Conclusion
Ultimately, as a marketer, you’ll want your analytics to tell a story and help guide and then measure against your objectives.
It doesn’t matter how many “high-fives” are shared in the marketing suite when an individual campaign returns some positive data. That’s a short term and potentially painful strategy. Instead you need to focus on how to use the data collected across your organization to build a scalable and profitable business in the long term.
However, not all marketers have the time or the skills to carefully monitor their analytics and act on the information their data shares. If you need help understanding what your data is trying to tell you, we can help translate those figures into an actionable strategy.
For more information, contact us at expert@emfluence.com.
