Call it a recession, slowdown or a downturn. The terminology might vary, but the financial reality is the same. For many online marketers, shrinking budgets and increased scrutiny on spend are just two of the consequences of this turbulent time. While budgets are being scaled back, demands for reporting, transparency and accountability are increasing, inescapable proof that marketers need a watertight ROI for each and every activity they pursue.
So, how can marketers ensure that they trim only fat, not muscle, when looking to deliver against a backdrop of increased uncertainty and reduced budgets? Although many online marketers have been using basic web analytics for a while, there's never been a more compelling time to exploit the full range and use of such tools. By dealing in the reality of data, and taking a more scientific approach, marketers can not only ensure they scale back under-performing programs, they can also spot new opportunities to exploit the competition and maximize ROI. In fact, planning ahead now could help set up an organization for even greater success when the economy recovers.
So, what are some of the ways that online analytics can help you protect your marketing budget and not just survive, but also thrive during the downturn?
1. Prioritize getting to know your visitor
While some web analytics approaches focus merely at the single visit or session level, today's complex online universe and lengthier customer engagement cycles demonstrate a need to elevate website performance analysis to the individual visitor level. Studying the attributes of a web session without having the behavioral context of previous and subsequent sessions just doesn’t give a complete or compelling picture.
Having an intimate understanding of the lifetime value of each visitor to your site is the only way to target them effectively with tailored campaigns that speak to their buying needs and motivations. Thinking like this can help you navigate a smoother course in a downturn, but it can only be powered by intelligent application of the right data.
2. Put the right data into the right hands, in the right way
Having the right data with which to make the right decisions is a key element of a recession survival strategy. But, you'll need to go further than that if you want to convince your senior management team that your marketing budget is one that needs to be protected, not attacked.
It might sound simplistic, but think about how you can better "market" that data to the key stakeholders and executive team members that will be making those kinds of decisions. This is where tools like executive dashboards and metrics like key performance indicators really need to come into play. Consider the following business metrics that could easily be reported in a dashboard format: customer conversion rates, average order values and shopping cart abandonment. It can be beneficial to provide the data in context by benchmarking performance against peers and competitors -- and against different product categories -- as well as against historical trends.
3. Take advantage of the expanded appetite for online media
As I referenced earlier, today's consumers are firmly in control of their media consumption, both on- and offline. They are choosing to spend more time online and in more places than ever before. The online media universe is also expanding rapidly, with a massive array of sites tempting the same sets of eyeballs. So how can marketers ensure that they reach customers in all the different places they visit on the web, beyond their own site?
It all comes back to understanding each and every customer. By using analytics to map out the various destinations on the web that each individual visits over time, you can better understand how to tailor campaigns that reach effectively across their entire online journey, maximizing your reach and ROI.
4. Multiply your channels, don't duplicate them
Any decent marketing campaign involves using multiple channels to reach customers in different ways and in different places. However, it's surprising that so many brands are still pursuing the one-size-fits-all approach when it comes to their multi-channel strategy.
Think of a multi-channel marketing strategy as a precision instrument, which can be applied to help guide a customer's thought process in an intelligent way. In this climate, the best multi-channel campaigns empathize with and respect the fact that consumer-purchasing behavior has become necessarily more complex, with longer buying cycles and stricter selection criteria, especially for larger purchases. So, layering a multi-component campaign to inform and guide the buyer along the way could ultimately be more profitable than a one-shot, one-visit, one-channel marketing blast, even though that might at first glance appear to be the more cost-effective and therefore appealing option. This could also involve integrating your offline sales approach with your online marketing strategy.
For example, a retailer of boats might assume that the big sales opportunity lies with the one-time boat purchase. Not necessarily so. A boat retailing company that we work with found that after people purchased a boat offline, they came back to the company to spend significantly more on the website. In many cases, consumers exceeded the amount spent on the boat in the amount spent on boating accessories. By optimizing the site to attract offline buyers back to spend on equipment, this retailer was using analytics to make smart product recommendations and encourage repeat buying of a different kind. Thinking like this can help you navigate a smoother course in a downturn, but it can only be powered by intelligent applications of the right data.
5. Evaluate and assess new tools, based on your marketing goals
During a downturn, there are varying schools of thought when it comes to investing in something new. The first would say that this is actually a perfect time to look at new marketing tactics, such as social media tools like Facebook, Twitter and even virtual worlds like Second Life. These carry the benefit of being relatively cost-effective to implement, yet with a potentially influential and viral appeal that could pay dividends, especially against the competition.
However, the second school of thought would recommend that in tighter economic times, marketers should stay with the tried and tested. New tools are all very well and good they say, but unproven. How can their impact be properly measured and displayed in a useful KPI format?
So which should it be? Speculate to accumulate, or retrench and recover? It comes back down to the goals you've set for your marketing campaign, the risk versus the rewards and, of course, the data.
As a marketer, you need a clear understanding of your target customers (they're all individuals, remember) and their needs, motivations and desires in order to properly evaluate the marketing tool kit you have at your disposal. For example, a retailer of young adult fashion might benefit more from forming a Facebook group than a purveyor of foot-care products, which might get more mileage out of a laser-targeted paid and organic search campaign. But you won't know this unless you understand your audience.
Whichever channels you invest in, there has never been a better time to re-evaluate and audit their effectiveness, especially with regard to how your customers' behavior might be changing. The old adage "know thy customer" might sound cliché, but it could provide a valuable key to thriving on the upswing.