Marketing Tactegy

Measuring the effectiveness of social media

One of the hotter topics right now in metrics is how to measure the success of social media.  Many social marketers are looking for the answer to this seemingly simple question.  The good news is that there is a lot going on here.  As I’ve become involved in metrics and have spoken around the world on this topic I’ve learned that there are no easy answers.  There is however a framework with which to develop an answer.  (If you’d like, please visit www.marketing-calculator.com for information on a generalized marketing effectiveness framework.)

At one level the number of visitors to a social site can be one measure of success.  At the next level we have to measure the level of engagement.  Time spent on site, the number of comments, videos or other content submitted can be an indicator of success in the social media space.  Unfortunately, these measures don’t determine how successful these social marketing activities are at delivering sales in the stores.  Just like there is an indirect link between TV and in-store sales, so too, is there an indirect link between a consumers’ social media activities and sales in the store.

So we need a measure of transforming this emotional engagement into brand awareness/consideration and preference/purchase intent.  Once we’ve done this, there are a number of tools that we can use to actually calculate the effectiveness of a social marketing activity.

But this is only backward looking.  As marketers, we want to look forward into the future.  How well will this next social marketing activity drive awareness, engagement and sales in the store?  For this we need to use a number of different tools (not complex) and then put the pieces together.  However I will address this in my next post.  In the meantime if you’d like more information or discussion on this topic, feel free to reach out to me on LinkedIn (www.linkedin.com/in/guyrpowell) or at www.DemandROMI.com.

 

New marketing effectiveness blog in Singapore

Marketing Institute of Singapore

I wanted to let you know that I have been invited to blog on the Marketing Institute of Singapore’s site (Marketing Institute of Singapore ).  If you’re interested in learning about general marketing conversations and about marketing in Asia, take a look.

Marketing Calculator

With my new book out (Marketing Calculator ) and the general level of discussion in this marketing ROI area, the discussion should be pretty lively.

I do have a question for you and that is, what do you see your marketing investments to be for the next two quarters (Q408 and Q109)?  Will spending be made to gain share in a down market, or will the finance team win and marketing will be cut to maintain margins?

I look forward to your views.

Last Touch Attribution

DemandGen Report just published an article of mine on Last Touch Attribution (The first word on Last Touch Attribution, DemandGen Article).  This term clarifies one of the key areas of marketing measurement and accountability.  A related term has to do with marketing contributions from an Integrated Marketing Campaign which I will talk about in my next post.  Last Touch Attribution was coined a year or so ago to help marketers communicate some simple steps relating to marketing ROI. It refers to attributing all of the weight of the results to a single marketing activity.  It disregards all other touches, whether they are prior or parallel touches using other media.  Synergies, halo and cannibalization are ignored.  So if a single direct mail piece is dropped all of the responses to that piece are attributed directly to that direct marketing activity.  All brand effects are ignored as well as all other components of other marketing campaigns.

Last Touch Attribution

I just spent a day at a ROMI (Return on Marketing Investment) session with a major high tech company that is actually pretty advanced for their ability to track marketing costs and results.  Marketers have been struggling for a long time to finally differentiate and communicate this type of measurement with the measurement of response to an integrated marketing campaign, where all of the direct results can’t be directly measured.  In my example above, response codes clearly delineate where the specific attribution came from (ignoring all other unmeasured effects.)   In an integrated marketing campaign, each of the campaign elements contribute to the overall response, both in the short term and in the long term (e.g., brand value). 

Integrated Marketing Campaign Contribution

So the IMC Contributions represent the value that each of the campaign media elements contribute to the final result.  There are a few other terms that must be covered to deliver the final picture.  But those, I will talk about in my next blog.

If you have any comments, please let me know.

Sneak preview of my new book

My new book, Marketing Calculator:  Measuring and managing return on marketing investment is about to be published and should be available shortly.  It has been exciting but also time consuming to actually go through the publishing process.  Nevertheless it will be available in the next few weeks, initially in Asia and then in September in the US.

New marketing effectiveness concepts

There are a number of new concepts that I think you will find valuable, namely:

• The Marketing Effectiveness Framework
• The Marketing Effectiveness Continuum
• The Marketing Effectiveness Culture
• Last Touch Attribution(TM)
• 4P3C1E Framework

Drive Marketing ROI

Each of these will help marketers to prove and improve their marketing effectiveness to increase ROI and drive revenue profit and market share.

Stay tuned.  I will have a bunch more to say in the coming weeks.

Multiple airings, interesting statistics and marketing ROI

I read with interest the article on Nielsen’s new measurement statistics (MediaDailyNews, Nielsen Sings New Ratings Tune: 'We Can Be Heroes, Not Just For One Day', September 26th, 2007) and I was surprised to think that the new numbers to be provided will be the unduplicated reach for the new show “Heroes” on NBC.  This will certainly be very important but some additional research will also be enlightening:

It would be interesting to know:

• How many viewers will watch it twice
• How many households will be counted only once, even though different family members will view it during the first airing and others the second airing

Since we know that every impression received by a viewer adds additional value and marketing ROI to the brand and their advertisers, just providing the unduplicated reach won’t tell the whole story.  Secondly it will be interesting to see how this will work when we finally get commercial viewership which is what the advertisers really care about.

Surround-Sound Marketing

Surround-sound, or 360 degree or integrated marketing campaigns have become hot topics in the last few years and have enabled marketers to design and deliver very effective marketing campaigns.

Surround-sound marketing and psychologics

Rex Briggs and Greg Stuart describe the process in detail in their book ‘What Sticks,’ but let me give a brief overview here.  At a high level the interaction between media is more than just providing multiple touches about a specific message.  The idea is that the messages are reinforced between each other.  In particular, the concept of ‘psychologics’ means that, for example, a print ad actually helps the mind conjure up the imagery of a corresponding, previously viewed TV ad.  Because of this the value of the print ad is actually higher than the value of a print ad where there was no corresponding TV imagery.  This is probably the reason why many non-TV ads are improperly attributed to TV because they trigger the mind to conjure up the images from the TV commercial.

If, for the moment, we leave aside the active or passive exposure to a media type and if we assume that the viewing of a commercial on television delivers the most imagery, because it has both video and audio components, then it should be that a single viewing has the largest influence.  Radio has only an audio component.  Print has a visual and written component (and sometimes odor), but does require more active participation to read and absorb the message in the ad.  In this case in order to get the biggest bang for the buck out of a surround sound marketing campaign, then the most imagery oriented ad should be run first followed by the other media.

Traditional media analytics may be wrong

This has a lot of implications to help marketers improve media buying and flighting.  It also has implications of how marketers measure the results of their surround-sound marketing campaigns.  Simply correlating impressions of the various media elements to bumps and wiggles in the outputs may provide incorrect conclusions as to what is working and what isn’t.

We now need to know which consumers actually saw one ad only, two ads from different media and so on.  Only with this detailed viewership model can we truly see how effective one media channel is versus another.

If you have any comments on this I would love to hear them.  Please let me know.

Product Sampling and Marketing Analytics

I was recently involved in an interesting discussion on the use of sampling which I will attempt to repeat (in a disguised fashion) here.  Certainly sampling can be a great way to seed the market with to induce trial and hopefully repeat consumption.  But the question is how do we account for the results from the sampling?

Multi-step marketing

Let’s say that we offer samples of a new product at some major event.  Let’s assume it is a food product costing less than a dollar per serving.  The assumption is that after the sampling event, the consumer will go home and then purchase it again (and again) in the traditional outlets of food, drug or mass.  As opposed to a typical television commercial, this is a two (or more) step process begun with the initial sampling event leading to further purchase actions.

Sampling and marketing mix modeling

The traditional marketing analysis technique, marketing mix modeling (MMM) has difficulty capturing the results from a sampling event, because it doesn’t capture the true purchase dynamics.  MMMs try to correlate the bumps and wiggles in the marketing inputs with the bumps and wiggles in the outputs, sales to determine the relative impact of each of the marketing activities.  In the case of sampling, a multi-step marketing tool, the follow-on purchases can’t easily be determined because the increases in the output bumps and wiggles don’t easily correlate back to the inputs, although some synergy elements can be tried.

Because of this, attribution back to the sampling activity is potentially misrepresented and in the usual case under-attributed.  Smart marketers know this and continue to use sampling knowing that the traditional analytics don’t correctly account for these types of multi-step marketing tools.

Agent-based modeling and multi-step marketing

In order to measure these results or those of other multi-step marketing activities, we need to use other analysis techniques.  Survey techniques can determine the propensity to repeat immediately following the initial trial and deliver reasonable results, although they may not be able to include all of the nuances of synergy and other surround-sound marketing effects.

In order to properly account for sampling amidst all of the other marketing activities, a consumer-centric approach is required and agent-based modeling can be one of those methods.  Because agent-based modeling can accurately represent the impact of this multi-step trial and repeat process it can easily deliver the necessary analytics to determine the true impact of sampling on the marketing mix.

There are many other examples of multi-step marketing.  Certainly in the business-to-business marketing environment where marketing delivers leads to a sales force is one.  Catalytic marketing also has elements of a multi-step approach.

If you have other examples of multi-step marketing that fall into this discussion please let me know.

Long Term versus Short Term Marketing ROI

The President of IRI Global Services, Sunil (Sunny) Garga was mentioned in an article on Forbes.com, ‘IRI Long-Term Drivers Consortium Study(SM) Releases First Wave of Top-Line Results and Launches Second Study’.  It will certainly stir up some interesting discussion on the choices brand managers have in either making the numbers this month versus delivering long term brand value next year and beyond.

Short versus Long Term Focus on Marketing Effectiveness

With the short term focus impressed on companies by the financial markets, brand managers must continue to look for marketing vehicles that drive marketing results this month and this quarter at the sacrifice of the brand value for next quarter and next year.  Combined with the fact that many lower level brand associates only have tenure of about six months before they are moved to their next assignment, there is little to no incentive to even think about the long term.

Interestingly many of the tools used to determine marketing effectiveness have a short term focus.  Last touch attribution and marketing mix modeling try and connect the dots between today’s marketing actions and their impact over the following few weeks.  The indirect impact of a coupon drop or a TV commercial over the next two years is generally not analyzed.

Comparing Marketing Effectiveness of Two Media Types

Let’s assume for the moment that we just determined the marketing ROI for TV and coupons and both of them had exactly the same ROI as measured in short term sales, ignoring incremental brand value effects.  On the other hand if it was determined that coupons deliver a higher marketing ROI than TV, (ignoring incremental brand effects) which would the brand manager choose?  Given their short term focus brand managers would inevitably choose coupons over TV.

What is needed then is a valid and objective measurement of both the incremental revenue for each media and the incremental brand value of each media for marketers to be able to make an improved decision between short term sales and long term value.

Risk and Marketing ROI

In an ideal world the value of the brand would be worth some quantifiable value in the future.  Unfortunately, even though a particular media may deliver a higher brand value than other media, that brand value may not be able to deliver incrementally equal amounts of value at some point in the future.  There is uncertainty, there may be diminishing returns or all sorts of effects may come into play.  So a risk component and potentially other non-linearities must be added to the equation to provide some estimate of the incremental future revenue that incremental brand value may deliver at some point in the future.

There are tools and research methodologies coming on line that can deliver estimates of this long term brand value.  And it will be interesting to hear about the results of this upcoming IRI study.  If you have any comments or would like to learn more, please let me know.

TIVO and Marketing Effectiveness

There have recently been a number of articles on how to improve the effectiveness of the thirty second TV commercial in the face of TIVO, DVRs, and time-shifted viewing. 

With the ability to fast-forward through commercials, advertisers are no longer getting what they thought they paid for.  The network says one thing, Nielsen and TNS say another and yet TIVO and others are starting to deliver even further conflicting information.

Marketing Effectiveness and the DVR

There seems to be a few thoughts emerging to deliver the promised results in the face of the oncoming DVR:

1. Develop more creative, different and entertaining ads that viewers won’t skip over
2. Make certain positions in the commercial pod more valuable because those positions are viewed more than others
3. Advertise at the bottom of the screen during the program
4. Develop ads that people will remember when viewed in fast forward mode
5. Increase the use of product placement to deliver brand impressions

Marketers and the networks will need to develop measurement methodologies to determine how each of these variations can deliver the marketing results required to drive a positive marketing ROI through TV advertising.

It should be an interesting next few years.  If you have any comments on this, please let me know.

Marketing Effectiveness Around the World: Singapore & Hong Kong Recap

I just returned from a 10-day whirlwind business trip to Singapore and Hong Kong.  I put on a 2-day workshop on proving and improving marketing effectiveness for senior marketers in each country (Actually, I was corrected to say that Hong Kong is a Special Administrative Region of China.)  It’s refreshing to see that both Singapore and Hong Kong have similar issues as many marketers in the US.  After having trained and presented this material to thousands of marketers across the globe, I have found that there is a still a strong desire to learn more about it, but still reluctance to actually effectuate change.

Which pill would you take?

In order to set the stage for the workshop I play a video clip from the movie, the Matrix, where Morpheus asks Neo ‘You take the blue pill and the story ends. You wake in your bed and believe whatever you want to believe.  You take the red pill and you stay in Wonderland and I show you how deep the rabbit-hole goes.’

Improved marketing effectiveness requires investment in time and money and brainpower

The point of the video is that measuring and improving marketing effectiveness requires both a commitment in terms of effort, time and money.  We have to choose to want to do a better job at marketing effectiveness. 

No such thing as a free lunch

There is nothing free in this world and certainly significantly improved marketing effectiveness and ROI fall into this category as well.  We can either continue marketing in Wonderland or we can see ‘how deep the rabbit-hole goes’.  We can expend brainpower, time and effort and money to manage our marketing in order to determine its effectiveness, compare it to the effectiveness of other marketing activities and then rearrange and re-allocate our spending to invest in more of the good stuff and less in the bad.

Are you ready to improve your marketing effectiveness?

How much do you invest in proving and improving your marketing effectiveness?  If you want to learn more feel free to attend one of our workshops – www.MarketingROIWorkshop.com or www.ROMIWorkshop.com (sorry for the sales pitch).  The Singaporeans and the Hongkongese were definitely ready to take the red pill.  Are you?

I look forward to seeing you there.  Only red pill marketers need apply.