Successful Marketing Requires Even Better Measurement and Analytics

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Forrester's Tina Moffett explorers the adoption of advanced analytics, measurement and attribution across marketing channels. She will share current practices and trends to better understanding how brands can use and apply measurement and analytics in their organization to optimize both cross-channel marketing campaigns and customer programs.

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  • Thank you, Paul. Its great to be hear today to talk about a topic near and dear to my heart—measurement.My name is Tina Moffett, I’m an analyst on the customer insights team at Forrester. I cover anything and everything around measurement—attribution, marketing mix modeling and metrics around marketing efficiency and effectiveness. Today, I’ll share some research and trends around measurement.But before we get started, I wanted to set the stage. I wanted you to understand why I think measurement is essential for businesses to grow. Why not only measurement and analytics—but accurate—measurement and analytics will help win, retain and grow customers(CLICK)
  • This is my son Jack. Jack will be 3 next week.Jack is a…well, he’s a lively kid. Loves to run, play, and really, he just wears me out!So, to channel some of his energy, I signed him up for soccer. I went to a really great place in NY. House of Sports. Great large facilities, great teachers.Well, I went to their FB page to check them out, visited them onsite and while there I filled out an information sheet. They sent me an email regarding their spring soccer tots class, I ended up signing him up, Received the receipt and have my class scheduled all online through their secure portal. It was an easy process and they took all my information, sent me relevant content/messages and I ended up signing up for my son.(CLICK)
  • Picture: fullcirclecrm.comWell when I was on the online portal one day looking up Jack’s schedule, I noticed I had this optionSelect a player—this was weird to me. I only had one son, why should I select myself. I never signed up for anything.And (CLICK) my career stats. First of all, I played no sports with house of sports and—most importantly—I’m not 39. I’m significantly younger. SIGNIFICANTLY.While those details may not bother some. It bothered me. I gave them my $265 dollars, I enrolled jack not only once but twice, and the interface that I use to access my son’s information is inaccurate. It’s frustrating. And it made me think (CLICK) data does not equal intelligence. Just because they had all my information, they never, ever used it in an intelligent way. Now, they couldn’t of used Jack’s information—he’s underage. I get that. But they could have customized the experience through the interface, recognized that I’m the mom-the care giver-and offer me different sport options for my son. Or a place for me to order more tee shirts or soccer balls. But they failed.Pivoting on this example, I’m hear TODAY to talk about the changing/evolving customer interaction ecosystem and how measurement and analytics need to provide real time insights to which interactions are working and which ones aren’t. (CLICK)
  • …I will share with you consumer interaction trends and how the of the age of the customer is drastically forcing brands to change from marketing strategies to interaction strategies. I will then dive deep into different measurement and analytics adoption patterns and trends and finally I will end with 3 key takeaways to consider when developing a measurement and analytics strategy (CLICK)
  • Before we start down the path of measurement and analytics, let’s set the stage. We need to discuss what consumers are doing, how they are interacting with the brand—to help make the case for more advanced measurement and analytics. (CLICK)
  • To win in the age of the customer companies must focus on four market imperatives:Transform the customer experience: Forrester defines customer experience as: How customers perceive their interactions with your company.Our Customer Experience Index has shown that customer experience leaders enjoy higher stock performance and revenue than the laggards in those same industries.The challenge for companies is to re-think customer experience from the outside-in which means managing and building organizational capabilities for Cx to mature from break-fix to break-through customer experience capability and deliver an exceptional unified experience across touch-points.Embrace the mobile mind shift: The mobile mind shift is the expectation that your customer can get what he wants in his immediate context and moments of need. Shifted customers give their loyalty to companies that support them in “mobile moments”, and dump them if there’s a more connected alternative. 52% of highly mobile people are frustrated when something they want isn’t available on their smartphone. Serving customers now means serving them in their mobile moments. Become a digital disruptor: Digital disruptors are those who threaten to make you irrelevant by delivering a more compelling product and service experience than you can and at a lower cost. In today’s digital era, more players can experiment with disruptive ideas because:Barriers to entry are near zero so more disruptors can easily jump into your space with their idea and they can fail fast and cheap and move on which leads to far more idea power from the disruptors.Firms that do not disrupt their own businesses will sit by watching as someone else generates and implements the best product ideas their category has seen in its history.Forrester believes firms in any industry are facing 100X the innovation power from disruptors than ever before.Turn big data into business insights: Big Data is the frontier of a firm’s ability to store, process, and access all the data it needs to operate effectively, reduce risk, make decisions, and serve customers.With digital channels, firms have more data than ever. But on average, they utilize only 12% of their available data.Developing real customer and business insights from all of the data now available requires an overhaul to both data management and the analytics programs.One interesting example we’ve seen is US retail chain Macys work in price optimization -- based on sales and competition. They now do more than 270 million price calculations in less than 2 hours (down from 30 hours) resulting in several price changes per day.
  • The age of the customer is leaving massive footprints of data for organizations to leverage and drastically change their strategy. In the customer’s world, they produce personal information, such as information about their family, their aspirations, their needs. From your point of view, you have information based on their behavior and interactions with the brands, for example, if they went to your website, or how they interacted with you in the past..Let’s think about this…
  • This: this is your customers’ life. They’re bombarded with messages about the products and services they should be interested in, but almost NONE of it is tailored to them! They see posts on Facebook – both from friends and from brands – telling them how great this bank or that retailer is. They do some research, but Google give them too many choices, creating a state of “analysis paralysis”. And then, the minute we recognize them? Well, we launch into a series of marketing communications that are rarely targeted to what their real needs and wants are! And in the end, we cannot measure and analyze effectively what’s working and what isn’t. It’s frustrating for YOU and for the CONSUMER. (CLICK)
  • This illustrates my next pointFundamentally, we have two problems that are at odds with one another: an imbalance of questions and answers.(CLICK) First, we have too many questions, but the wrong data to answer them (EXAMPLE)(CLICK) Second, we have way too much data and we’re unable to answer the right questions (EXAMPLE)And as a results (CLICK)
  • Picture: http://gigaom.com/2012/12/22/we-dont-need-more-data-scientists-just-simpler-ways-to-use-big-data/….there is an increased spotlight is on measurement and analytics to help weed through this information with great precision, insights and advance analytics rigor. It’s an exhausting process, but organization are using analytics and measurement to drive their business decisions…their marketing decisions. So, what are we seeing in terms of adoption and trends in this space? CLICK
  • Overall, we are seeing a rapid increase in adoption of analytics and measurement. Go onto meetup.com and search big data. We have large groups of people, some professionals, students, in academia—but all with a strong interest in data, technology that enables data, and the analytics that drive insights. They want to know. How we can leverage analytics and measurement to better understand business growth, consumer interactions, and marketing success.
  • First, big data still presents a tremendous amount of opportunity for marketers.
  • …and the application of big data can vary from customer facing activities, such as interaction management, online testing and targeting.And to back end analysis, such as attribution and marketing mix. So, while we see such a tremendous amount of data, businesses can use this informationHave more relevant conversations with their customers and to really understand behaviors, motivations, and needs—all while measuring the impact of their business.So, how are firms using this information (CLICK)
  • Source: 2014 Measurement and Analytics Survey (currently in market)Forrester currently has, in market, the 2014 measurement and analytics survey, when asked Please rank your top three drivers that encourage your organization to make use of measurement and analytics:So, we wanted to explore this a bit further. Which analytics techniques are being adopted by analytics professionals (CLICK)
  • Now, we found that most firms are doing some type of reporting and descriptive analytics at a base level. In fact, they’ve been doing it for a long time. However, Predictive Analytics—such as propensity models—has seen a recent increase in adoption. Many firms are using propensity models to better identify when customers will churn, or what’s the next best offer. Additionally, we’ve seen an increased adoption in “real time” analytics. The ability to make instant changes to the consumer conversation. Think about it. It’s the ability to send out relevant ads, relevant offers, to your customers. And on the business side, it’s the ability to change immediately your marketing strategy, your media buying approach. This increased need of real time action is necessary in the age of the customer. Customers can go to your competition, so having the analytics in place puts you at a strategic advance to retain your existing customers, and grow the relationship.
  • SO, naturally, the expectations from analytics technologies are HIGH. The analytics technologies must deliver on the need for predictive analytics and real time actionablity. When we looked at the trend of how specific analytics technologies would impact a firm (CLICK) occurring between 2012 and 2013 (CLICK)
  • From 2012 to 2013, we saw a significant shift in the need of big data platforms, CI platforms, and BI platforms. Why? Data has grown, customers are producing massive amounts of information, and firms need the right tools to access this information. Big data platforms are needed to collect and manage this data—it’s the layer that sits under CI applications—the applications that enable firms to identify customer trends, their needs, their motivations. And an increased in BI tools—tools that visually display data and provide holistic business reports—collects all this big data information and provides insights to how it impacts the bottom line (revenue, profitability, and growth) of the business.
  • Photo Source: increaserss.com
  • Just to level set Forrester defines attribution as the practice of allocating proportional credit to all marketing communications, across all channels, that ultimately lead to the desired customer action. We’re not just talking digital, or mobile…we’re talking every, single interaction point across the customer lifecycle. This is a daunting task, because it’s not easy to assign credit across all touch points—addressable or non-addressableSo, in a survey we have in market right now (and sharing early results), we found that (CLICK)
  • www.exchangewire.com 16% of brands leverage advanced analytics techniques to inform a more accurate evaluation of their channels. So, some firms understand the need to employ advanced analytics to understand marketing performance, to understand channel performance. But clearly, not enough. There is an extreme deficiency in adoption of more advanced analytics, since we found that (CLICK)
  • blog.sourcemetrics.comAbout 53% of brands still use last touch measurement to allocate conversion credit. Now this number has gone down compared to recent years, but still a large proportion of companies are using basic approach's to evaluate performance. MOREOVER, they’re using last touch as a way to help them determine if a campaign was successful, and to help guide them on their future decision to invest in the right channels and tactics.But, really, who can blame these firms? The analytics community has a lot of different approaches to solve for measurement and insights. In the case of attribution, there is complete confusion about how to use attribution and marketing mix together. At Forrester, we see attribution and marketing mix as the holy grail of marketing measurement, insights, and optimizations. (CLICK)
  • But when they are used together, they provide deep, true performance insights on conversion credit and cost allocation (CLICK) across all channels. Those insights and metrics are then inputted into the marketing mix model, which can now optimize on more accurate performance metrics. So, budgets are set based on what tactics and channels are actually driving value. This is a holistic marketing performance measurement and optimization approach. (CLICK). Ultimately, firms must get to this approach to gain a better, more accurate view of channel and tactical campaign and channel performance, while understanding how investments into specific channels could impact their Key Performance Indicators, Like Revenue or Profitability or Customer Value.So, what can businesses do with this types of insights? (CLICK)
  • Source: 2014 Measurement and Analytics Survey (currently in market)In what areas of business do you apply insights from marketing measurement and customer analytics? [Select all that apply]These insights are leveraged to understand 2 things: customers and marketing performance. When ask in our in-market survey, how do you apply insights from marketing measurement and customer analytics, 68% indicated they use it to manage customer relationships. They leverage these insights to understand how they can talk with more relevancy with their customers, so naturally, 67% use insight for future channel and campaign planning. Because, when you think about it, when firms know what their customers want, they can properly understand the performance of channels and campaigns. And finally, 62% say they use insights to manage the customer experience. And we’re seeing this a lot today. A customer responds to a mobile text with a specific offer as she’s walking RIGHT PAST the store, and decides to take advantage of the offer, walks into the store, buys that sweater and redeems her offer. In the customer’s mind—that offer she received and her purchasing that sweater is a full on experience. So, brands are taking advantage of that and coupling some exclusivity, in-store experience with that. So, there’s a bridge between insights, and experience. Now, that I’ve shared some trends with you, some of my research, what can you do IMMEDIATELY when you walk into the office on Monday to adopt a more advanced (CLICK)…
  • …approach to analytics and measurement? I like to end all my speeches with giving advice on taking action.You need to empower analytics. But what does that mean? (CLICK)
  • In our surveys we constantly hear that data management is the biggest hurdle. Part of this is managing the massive amounts of data across channels, across marketing tactics. And trying to tie that data together requires someone—a data evangelist—who understands the complexity of the data, how it can be leveraged across different channels, though direct (customer key connection) or indirect ways (via statistical analysis). The first thing to do when you get back is to identify the person in your organization—because there is one—who knows everything about your data. Sit down with them. Have them go through the type of data your firm has access to, at what level (customer level or aggregate), the condition of your data, and the channels with all the data. From there, you’ll be able to understand how you can leverage this data to enhance analytics and measurement. Build a meta data dictionary. Have it be a bible in your organization. Assign someone to manage it. Most of all, be proactive to ensure your data is clean, accessible, and privacy compliant.
  • Second, choose the right mix of analytical techniques that drive a balanced customer growth. What does that mean? It means that of all your analytical approaches, make certain that you have the right focused mix of awareness/acquisition/retention & growth/loyalty. For established large financial services firms, this may mean focus a lot of your marketing/business efforts on cross-sell/upsell efforts to existing clients, while targeting the right group of high growth customers for acquisition. For Telco, this may mean to strongly focus on pure retention and loyalty programs, with about 15% focus on acquisition efforts. Just make certain your analytical techniques are aligned with business objectives. And finally (CLICK)
  • Don’t deploy analytics and measurement efforts as “projects” but as ways to grow and retain your customers. Analytics should be the foundation to build a customer strategy, and in the age of the customer, it’s data and insights that’s helping businesses determine future investments and how to drive contextual conversations to retain and grow their customer base.Thank you.
  • Successful Marketing Requires Even Better Measurement and Analytics

    1. 1. Making Leaders Successful Every Day
    2. 2. Successful Marketing Requires Even Better Measurement and Analytics Tina Moffett, Analyst May 2, 2014
    3. 3. © 2014 Forrester Research, Inc. Reproduction Prohibited 3
    4. 4. © 2014 Forrester Research, Inc. Reproduction Prohibited 4 1. I’m not a “player” 2. I’m not 39 Data = Intelligence/
    5. 5. © 2014 Forrester Research, Inc. Reproduction Prohibited 5 Agenda › Consumer trends › Measurement and analytics adoption and trends › Empowering analytics
    6. 6. © 2014 Forrester Research, Inc. Reproduction Prohibited 6 Consumer Trends
    7. 7. © 2014 Forrester Research, Inc. Reproduction Prohibited 7 We are in the age of the customer… Transform the customer experience Embrace the mobile mind shift Become a digital disruptor Age of the Customer Turn big data into business insights
    8. 8. ...and as result brands have massive footprints of customer data March 2013 “The Future Of Customer Data Management”
    9. 9. © 2014 Forrester Research, Inc. Reproduction Prohibited 9 Color story TK
    10. 10. Too many questions, but the wrong data to answer them Too much data, but unable to answer the right questions
    11. 11. The spotlight is on measurement and analytics
    12. 12. © 2014 Forrester Research, Inc. Reproduction Prohibited 12 Adoption and Trends in Analytics and Measurement
    13. 13. © 2014 Forrester Research, Inc. Reproduction Prohibited 13 Big Data still presents a tremendous opportunity for marketers to leverage
    14. 14. Marketing’s Big Data applications are known by other names › Customer facing • Dialogue-based campaigns/real-time presentation • Interaction/offer management • Online testing and targeting • Predictive call routing • Retargeting › Data and Analysis • Data capture and analysis • BI/Reporting • Web Analytics • Attribution/Marketing Mix • Real-time Scoring • Social CRM • Market Insights • Competitive Intelligence
    15. 15. Please rank your top three drivers that encourage your organization to make use of measurement and analytics 44% use analytics to improve customer acquisition and targeting 22% use analytics to improve customer retention 7% use analytics to improve marketing accountability
    16. 16. © 2012 Forrester Research, Inc. Reproduction Prohibited Predictive analytics is not new, but it has recently peaked the interest of marketers
    17. 17. Expectations from analytics technology are high “Please select the answer that best describes the impact you expect the technologies in the categories below to have on your firm” Source: November 2013 “Top Technology Trends To Watch: 2014 To 2016” Rank 2012 (N=216) 2013 (N=118) 1 Mobile applications Mobile applications 2 Mobile platforms (Android, iOs, Blackberry) Big data platforms for real-time analytics 3 Big data platforms for real-time analytics Cloud-based or as-a-service applications 4 Cloud-based or as-a-service applications Customer intelligence and analytics platforms 5 Infrastructure-as-a-service Mobile platforms (Android, iOs, Blackberry) 6 Business event processing and rules Infrastructure-as-a-service 7 Big data platforms for batch analytics Big data platforms for batch analytics 8 Customer intelligence and analytics platforms Sensor systems and smart computing 9 Collaboration and social platforms Business intelligence (reporting, visualization and analytics 10 Sensor systems and smart computing Collaboration and social platforms 11 Business intelligence (reporting, visualization and analytics Business event processing and rules Base: enterprise architect professionals, Global State Of Enterprise Architecture Online Survey, 2011 through 2013
    18. 18. Expectations from analytics technology are high “Please select the answer that best describes the impact you expect the technologies in the categories below to have on your firm - revolutionary” Source: November 2013 “Top Technology Trends To Watch: 2014 To 2016” Rank 2012 (N=216) 2013 (N=118) 1 Mobile applications Mobile applications 2 Mobile platforms (Android, iOs, Blackberry) Big data platforms for real-time analytics 3 Big data platforms for real-time analytics Cloud-based or as-a-service applications 4 Cloud-based or as-a-service applications Customer intelligence and analytics platforms 5 Infrastructure-as-a-service Mobile platforms (Android, iOs, Blackberry) 6 Business event processing and rules Infrastructure-as-a-service 7 Big data platforms for batch analytics Big data platforms for batch analytics 8 Customer intelligence and analytics platforms Sensor systems and smart computing 9 Collaboration and social platforms Business intelligence (reporting, visualization and analytics 10 Sensor systems and smart computing Collaboration and social platforms 11 Business intelligence (reporting, visualization and analytics Business event processing and rules Base: enterprise architect professionals, Global State Of Enterprise Architecture Online Survey, 2011 through 2013
    19. 19. Cross-channel attribution helps marketers understand the true impact of their marketing strategy
    20. 20. © 2014 Forrester Research, Inc. Reproduction Prohibited 20 What do we mean by cross-channel attribution? Source: “Cross-Channel Attribution Presents a Clear Path to Marketing ROI” September 20, 2012 The practice of allocating proportional credit to all marketing communications, across all channels, that ultimately lead to the desired customer action.
    21. 21. 16% of brands leverage advanced analytics techniques to inform a more accurate evaluation of their channels Source: In market survey on 2013/2014 Measurement and Analytics Trends
    22. 22. 53% of brands use last touch measurement to allocate conversion credit Source: In market survey on 2013/2014 Measurement and Analytics Trends
    23. 23. © 2014 Forrester Research, Inc. Reproduction Prohibited 23 Cross-Channel Attribution Marketing Mix Optimization Now, integrated approaches measures and optimizes marketing and media TV EmailDirect Mail Print Out Of Home Branch / StoreCall Centers WebSocial Mobile Integrated Measurement and Optimization
    24. 24. In what areas of business do you apply insights from marketing measurement and customer analytics? 69% use insights for customer relationship management 67% use insights for channel and campaign planning 62% use insights for customer experience management
    25. 25. © 2014 Forrester Research, Inc. Reproduction Prohibited 25 Empowering analytics
    26. 26. 1. Manage and connect all your data--across devices and channels.
    27. 27. 2. Choose a mix of analytical techniques that drive balanced customer growth.
    28. 28. 3. Deploy analytical models not as “projects” but as interconnected ways to drive customer value.
    29. 29. Thank you Tina Moffett Analyst, Customer Insights tmoffett@forrester.com @vmoffett

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