Methods to Measure Marketing & The Metrics We Move

Methods To Measure Marketing & The Metrics We Move

By Dean LevittFounder

Teacup Analytics

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

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

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

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

Let’s Pick The Right Metrics To Measure

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!

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


• 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…


• 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)


• 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

• More on this later…

• For now, just remember that KPI’s need both.

Ongoing Impact

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%


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!


• 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))

Our efforts resulted in significant, long term term improvement!

Reporting The Right Way

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!

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!

Changing Course

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

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

A Very Brief Primer on Analysis

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




• 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





• Action 3: Grow!





• 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


Results

ActivityLow High

Below

Above

GrowthOpportunity

OptimizationNeeded

The Do-Nothing Zo

ne


Results

ActivityLow High

Below

Above

Direct: B

Organic search: A+

Referral: A

Paid Search: B

Email: A

Social: D

Any questions?By Dean Levitt

Founder, Teacup [email protected]