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5 ways marketers are still using outdated metrics

5 ways marketers are still using outdated metrics Tony Zito
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I remember the first purchase I made online. I was looking for vintage music equipment up for auction on eBay. It was a pretty big time commitment, given the time it took to dial up, plus the incredibly slow pace everything moved online, so I didn't get on to browse and see what they had -- I only got on when I was looking for something specific. Once I'd put a bid on an item, I'd leave my computer and wouldn't get an update again until I came back home, dialed up, and logged onto eBay or my email.


Our relationship with online shopping has totally changed since then. Kids growing up today will never know what it's like to have a brand interaction as siloed or deliberate as it was when we first started shopping online -- let alone the time commitment of dial-up internet. Now, we're connected everywhere we go, and it's less and less common to have a shopping experience that doesn't span both offline and online via a variety of devices.


5 ways marketers are still using outdated metrics


As marketers, we're all very aware of the way shopping has changed. As a result, we're now faced with the challenge of creating connected one-to-one relationships seamlessly across all the channels, platforms, and devices we use as consumers. Marketing connects every touchpoint to align with the way consumers view your brand, which isn't broken out by channels or devices. In order to truly grasp it, we must adjust our view of streamlined consumer experiences, because the lines within the channel-oriented marketing landscape we've created are blurring.


It's no longer enough for marketers to focus on individual channel performance and last-click attribution. Despite everything that's changed since I was buying effects pedals on eBay, we're still measuring online advertising the exact same way: by clicks. For years, we've been talking about finding more sophisticated metrics. It's about time we got serious about adopting the next evolution of marketing measurement. What we really need today is an actionable understanding of what's influencing consumers across the entire consumer journey.

Measuring the journey, not just the channel


When it comes to measuring marketing's influence on today's consumers, it's time to get away from thinking about performance in channel-specific terms. Instead, we need to look at the right metric on a case-by-case basis, in a way that corresponds to the consumer's place in the purchase journey.


Each channel plays a role in influencing consumers towards conversion, and it's not enough anymore to know how they each work on their own, or which one drives the first click, last click, or highest click-through-rate (CTR). We need to understand how each of the channels work together to create an experience for the consumer, beyond click-based activity, and how that experience influences behavior -- whether that experience ends in conversion or not. The resulting insights can be used to create a more strategic alignment of marketing strategies to move consumers forward through all stages of the funnel.


With this in mind, it's important to look at metrics that make sense for where the consumer is in the funnel. Campaigns that are early in the consumer journey shouldn't be measured by, or optimized for, the same metrics as direct response marketing. Early funnel measurement needs to reflect factors that indicate exposure.


Previously, I wrote about outdated modes of measurement for display marketing, such as impression, post-impression attribution, and click-through rate (CTR). It's not that these metrics are wholly irrelevant. Along with metrics that demonstrate viewability and brand engagement, they still hold relevance as good indicators of intent and progression in the consumer journey. They are not, however, in any case, the metrics that should determine how performance is measured or how campaigns are optimized.


After spending lots of time observing, testing, and implementing measurement methods, I've identified some best practice guidelines for measuring performance at each stage of the journey, based on the metrics that are available for each channel. Drilling down into each stage of the funnel allows us to then take a holistic view of the entire omni journey.


Measuring high-funnel strategies


Branding and prospecting campaigns need to be measured based on factors that indicate exposure -- a measurement traditionally dominated by impressions for everything from print to TV, radio, and online. The problem is that impressions on their own don't give enough information to know if we're really reaching consumers, or if the consumers we're reaching are the right consumers.


With the technology we have today, we should be taking a more granular look at how those impressions are working to increase exposure, drive awareness, and influence consumers to progress through the marketing funnel and interact with other channels.


Today, we talk a lot about viewable impressions. This is a step up from impressions, but what's really valuable is understanding different levels of exposure and engagement a consumer has with an ad, and how that indicates how likely they are to respond to additional marketing. Engagement can span everything from a mouseover, which proves an impression was viewed, to time spent interacting with an ad, which demonstrates intent.


Evaluating these factors that indicate how engaged a consumer is with your marketing also allows you to more strategically optimize that consumer's journey. For example, if a consumer who was reached through your brand campaign uses the in-ad search tool or watches a video, you'll want to target them more aggressively with complementary marketing strategies than someone you reached with an ad who didn't engage. This kind of measurement also opens the door to do more programmatic advertising for branding, whether it's on a desktop or a mobile device, and whether it's a display or a video ad. Additionally, the data can be used to more strategically optimize campaigns for conversion.


Engaged impressions, or ads that have tracked in-ad actions, across devices perform better than impressions that haven't been engaged. This insight allows marketers to assign value to investing in quality ad inventory where impressions are viewable and to target consumers who didn't engage with an ad differently than those who did, so we're empowered to create the most impactful journey for each individual's level of engagement.

Measuring funnel progression


Seeing engagement data not only tells a story about the efficacy of the campaign, or the quality of the ad buying, but it also gives more granular detail that can be used to understand how ads are driving consumers down the funnel via touchpoints with other channels. For example, an investment in display should influence a rise in your branded key search terms.


Evaluating the impact each touchpoint has on the performance of other marketing strategies expands the relevance of channels that are typically reserved for low-funnel marketing and traditionally only evaluated in terms of clicks, like search, affiliate, and retargeting.


For example, an effective non-branded search campaign will fuel new prospects into your retargeting campaign as you drive first-time visitors to your site. Seeing that impact in your attribution data provides an understanding of which non-branded terms are performing best -- not just to drive traffic to the site, but preceding a higher propensity to engage with retargeted ads, or to visit an affiliate site to get a coupon code or more information from thought leaders.


As another example, while affiliate is primarily considered a low-funnel strategy, there are many publishers that act as influencers early in the funnel, sometimes being the first introduction to your brand for its readers. That introduction can lead to subsequent actions like a branded search, a direct site visit, or an app installation. While these touchpoints aren't always the last click preceding a conversion, they do impact the success of a campaign. Understanding this impact can affect the way you develop relationships with influential publishers.


Measuring low funnel strategies


While the objectives of high-level strategies are often less tangible concepts, like driving awareness and finding new site visitors, the objective of lower funnel strategies is really focused on conversion. This makes consumer behaviors that indicate intent, like a click, more relevant; however, limiting your view just to clicks is a mistake. An even bigger mistake is optimizing your campaigns to deliver clicks.


Across all channels, devices, and platforms, it's important to understand how those intent-driven actions are influencing conversions and factors like average order value (AOV) and retention, which have meaningful value for your business. In an industry fraught with fraud, not assigning a key performance indicator to the clicks you track in a campaign makes you vulnerable to wasting money on clicks that add no value to your bottom line.


Lift is another useful method of measuring marketing performance. By doing controlled A/B testing, it's possible to get a view of a single channel's performance independent of any overlap by other channels. While this doesn't provide the deep-level insights provided by an end-to-end attribution tool that demonstrates channel synergies across the customer journey, it does provide a clear view of the unique impact a marketing campaign has on performance. This brings accountability to invest in ad strategies that drive conversions.


Actionable insights


At the end of the day, collecting data has limited value without the ability to take action on it to improve your marketing performance and ROI. When we talk about an "omni experience," we talk about tying all these channels and the insights they offer together into a seamless approach for the end-user. Taking a strategic look at the streamlined cross-device data you're collecting, using it to optimize programmatic cross-device media buying, comparing converting journeys against non-converting journeys, and using that information to make your marketing work better is the future of online marketing measurement. This is the key to driving the omni experience.


Tony Zito is CEO of Rakuten Marketing.


On Twitter? Follow iMedia Connection at @iMediaTweet.


"Social media formula on speech bubble" image via Shutterstock.

Tony oversees Rakuten Marketing in the Americas, Europe and Australia, leading the development and execution of the company’s vision. As CEO, Tony drives the global organization in delivering consumer-centric omni experience marketing...

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Comments

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Commenter: Alastair Kane

2015, June 11

An insightful post. There is certainly still too much focus on specific channels and not enough of a more 'birds eye view' of how individual channels interact and cooperate to bring about a conversion. We have recently put together an eBook on what we think are the 6 most important marketing metrics to focus on which I hope you find useful http://hubs.ly/y0TKl-0

Commenter: Alan Harris

2015, June 03

Excellent read, thanks!