Measuring Success Through Marketing Metrics
In the world of marketing, one of the most embarrassing moments is when you’re sitting in a meeting and you can’t answer the question, “So, did the campaign work?” Most companies look at the bottom line. Did we increase revenue? But this is not always the best measure of success for marketing, especially if the company depends on a sales force to close the deal. Decreased revenue may not be a reflection of the marketing plan, but without marketing metrics it’s impossible to adequately measure success. The easiest and most effective way to track a campaign and get to know the behaviors of your customers is to set up website tracking software to compile data. You can track behaviors such as time spent on the website, path analysis, entry pages (which websites are they coming from), dates and times of visits, and even the browser that the visitor used, which can help in website development and testing. This information is imperative to measuring success. If you see that many potential customers clicked on the ad but left the website after only a few seconds, it’s time to examine the structure of the website, because visitors aren’t easily finding the information that they need. Currently there are several web-tracking devices that allow varying levels of depth. The leader in the market is WebTrends, which allows for customization and is great for a multiple product or services website. However, if a company doesn’t have the budget to implement a new tracking service and is simply interested in basic tracking, Google Analytics is available for free and only requires the Information Technology or Web department to encode the website with Google’s tracking codes. Research is recommended to determine which web-tracking device is best for your company. A well-rounded marketing plan often includes advertising in print publications (or billboards, posters, etc.), television, radio, direct mail and email, and online. Unfortunately, there is no one particular metric for examining all marketing efforts, so different methods must be used for each appropriate venue. Print and Television Traditionally, some form of print or television has been the advertising venue of choice. But in the past few decades more marketers look online for their news, information and entertainment. The biggest aversion to print and television nowadays is its traceability. Let’s face it, print and television ads aren’t cheap, so although it is possible to do market research testing to determine the effectiveness of an ad, this is by no means an inexpensive way to track an ad’s effectiveness. While it’s difficult to know how many people saw the ad, there are a few ways to track results. If the ad is targeted towards a specific event or limited time offer, then polling the potential customer when they contact the company or go to the web site is one way of capturing the response rate. However, the easiest way is to assign a unique tracking code or URL to the ad and then track it through the website analytics program. For example, if the website was www.financialinstitution.com and the ad was running in the Wall Street Journal, a possible unique URL could be www.financialinstitution.com/wsj. Instead of having to create a new landing page for this unique URL, the IT department would simply forward the URL to the designated landing page. Then the analytics tracker would show how many hits the unique page had received and the entire process would appear seamless to the visitor. The downside of this is that some people know that the extension /wsj is purely for marketing metrics and will leave it off, which can upset the accuracy of the tracking. If you are offering to send materials or if your customers need to sign up for an event, having a unique tracking code will allow a marketing department to easily track the effectiveness of the ad. The tracking code may then easily be changed for each insertion, which will allow for a more specific analysis to see which message or advertising vendor provided the greatest response. Radio The biggest problem with tracking radio is time and attention. If someone is listening in their car, they don’t have the opportunity to act immediately on the ad they heard—and remembering a unique URL is very difficult. One recommendation is to use the radio station’s keyword search on their website, if their users are accustomed to doing so. Remembering one word is often easier and can yield better results as the word is tracked through the radio station’s website. Direct Mail/Email Direct mail and email can be easily tracked through one-to-one marketing. Utilizing software tools that will set up a unique URL for the individual person will help to track their exact movements. This illustrates how frequently they visit their unique site and where they go once on the site. This is the new wave of marketing and as such there is no commercial-off-the-shelf (COTS) software available, so building the system will take both time and money. Online Online advertising has emerged as the number one favorite for marketers who like to track results because it’s so easy. Oftentimes the website that the ads are on will track the clickthroughs of the ads by simply adding a clicktag to the encoding. Marketing metrics for online ads are measured through a few industry terms that are listed below. While it’s important to increase your own results, it’s imperative to compare your results with others in the same industry to determine effectiveness. Impressions/CPM One of the most difficult purchasing methods to understand when switching from print or television is that it’s not simply done by the ad’s size. Instead of being solely based on size per day, online advertising costs are most commonly based on impressions; that is, the number of times a visitor to the website will see your ad. This is usually a very high number, in the hundreds of thousands per few days or weeks, depending on the website’s traffic. Marketers purchase the quantity of impressions that they would like and the price is determined by the CPM or cost per thousand (M is the Roman numeral for 1,000 so the phrase has become known as CPM). Cost-per-click (CPC) Some companies will have you pay for the number of times the ad is clicked on. This is very popular with search engine advertising because of the high number of impressions. This is often attractive to marketers because you’re only paying for results. The downside of CPC, especially on search engine websites, is that your average cost is determined by a bidding system—you could wind up paying over $20 for one individual click on some of the most popular searches. With costs being capped at a daily or monthly limit, for those keywords that have a high CPC, the ad may be pushed to the next page of results, which are rarely seen by a searcher. Clickthrough rates It’s exciting to receive 500 clicks, but if you purchased 500,000 impressions, that means your clickthrough rate is less than one percent. It’s difficult to determine what exactly that means unless you compare it to other data. The account representative should be able to tell you the average clickthrough rate, but be very careful about using other companies as your benchmark because so much is dependent on the relevancy of the ad. Because marketing is part analytical skill, part art, it may be that the ad wasn’t appealing to the target audience. So a certain website shouldn’t be dismissed just because it didn’t perform well. Trying different art and ad copy is easy with online ads as they can often be switched out with only a few days’ lead time. Although it may take a bit more time to add these measurements and to examine and interpret the results, making marketing metrics a part of the overall marketing campaign is vital to accurately tracking the results of the campaign, determining if the campaign worked, and receiving the best return on your investment.
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