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Why engagement analytics trump all others

Ron Person
Why engagement analytics trump all others Ron Person

For the past 15 years, web analytics have been used to measure the effectiveness of web strategies. But web analytics can be misleading and can drive marketing efforts in the wrong direction. Web analytics is based on the volume of visitor traffic and whether visitors stay on a web page. It is a measure of attractiveness; it is not a measure of engagement, relevance, or action. We need to know how relevant our marketing is to our visitor's needs. And we need to see where and how we can improve marketing for greater bottom line impact. With all the channels of web marketing, web, email, and social media, we now have more than 12 online marketing channels that need as many as 47 metrics to measure. What we really need is a short set of metrics we can use to compare effectiveness across these marketing silos.

First, we should be measuring marketing quality, not just visitor quantity. But current web analytic tools aim to measure and increase the quantity of people coming to a website. Web analytics is all about measuring aggregate average quantities; for instance, number of visits, percentage of new visitors, page views, bounce rates, top assets downloaded, most popular entry pages, most visited pages, and so on. Secondly, we are not connecting the dots. Email is tracked independently from the web which is tracked independently from the mobile web, social media channels, and mobile apps.

When you meet with a customer online, you are essentially engaging in a conversation. An exchange of communication and trust takes place. As this communication and trust builds the level of commitment also builds. This combination of communication, trust, and commitment exhibited by your customer is a measure of engagement value. Marketers can now understand what drives engagement and produces bottom line results, not what drives crowds.

Engagement analytics measures quantity, quality, and the relationship between the two.

Quantity is everything you know from web analytics today. Quality is the level of communication, trust and commitment achieved by your customers. Online marketing analytics tools somewhat express quality as conversion percentages, such as visitors having signed up for a newsletter. There are two problems with conversion: Not all conversions have the same level of trust, communication and commitment and as a website has more conversion points, understanding the complexity becomes overwhelming.

Marketers need this barrier of complexity distilled down to a simple measure of marketing quality; which we call the engagement value. Another measure used by engagement analytics is relevance, which is the relationship between engagement value earned by a marketing event and the number of visitors. If, for example, you run two identical AdWord campaigns on Google and Bing, and the Bing ad has twice the engagement value for the same number of visits, then you must conclude that the ad running on Bing has more relevance for the customer's needs. Marketers using engagement analytics can learn exactly which part of their marketing mix creates the greatest impact, which parts of their website earn the greatest Engagement Value, and where they should spend their next marketing dollar.

Measuring engagement on the web
To measure engagement you need to look for transaction points on your website where visitors show their communication, trust, and commitment. This is true whether your website is for B2B, B2C, or non-profit.

Here's an example of a B2B company that has hundreds of these transaction points. Each of these transaction points has one of three levels of engagement with each level having a different engagement value. The actual numbers are not important. The ratio between the numbers, however, shows the relative weight between the levels of engagement.

This is very different from measuring conversions. When someone registers for a white paper that's not just a one-point conversion as it would be in most web analytics, it is recorded as 25 points. When the visitor later requests a quote an additional 50 points is added to the engagement value they have accumulated.

Four powerful engagement metrics
Once you accumulate the engagement value and number of visitors you can do amazing things with those two numbers. It's very straightforward to see which campaigns, keywords, or referral sources produce the greatest engagement value. But there's much more you can do.

With engagement value and the number of visitors you can calculate two of internet marketing's most powerful metrics, the value per visit a measure of marketing effectiveness, and potential -- which is a measure of a marketing asset's effectiveness compared to its peers. For example, value per visit for a marketing campaign can be found by totaling all engagement value attributed to that campaign and dividing it by the number of visitors from the campaign.

By comparing the value per visit of campaigns you can easily see which campaigns have the greatest marketing effectiveness per visitor. Because this measure is the same for any channel driving visitors to your website you can compare marketing effectiveness between email, search engine, social media, and even real world events.

The second powerful metric is potential. Potential is a measure of the marketing effectiveness among peers: For example, how well a campaign, landing page, or asset does as compared to its peers. To calculate potential, calculate the value per visit for all peer items and then compare the item of interest against the average of all. For example, if you want to see if a new product's web page is effective you would start by calculating the average value per visit for all similar product web pages. Then calculate the value per visit for the new product's web page. If the new web page has a lower value per visit than the average then you need to improve the new page.

Using engagement analytics to find the truth in web analytics
This chart is an example of an executive insight dashboard. It shows how looking at only the number of visits can be misleading. In this example from a real campaign the grey line shows visitors decreasing in Q2 and then slightly increasing in Q3. What you can't see in web analytics is that there is a large increase in high-quality visitors and marketing effectiveness in Q3, as shown by the gold line. The value per visit, or marketing effectiveness, is shown by the green bar and reflects the big jump in marketing effectiveness.

Measuring marketing effectiveness with engagement analytics
Engagement analytics is clearly the way to:

Simplify analytics
Using just four metrics, visits, value, value per visit, and potential any marketer can identify which channels, campaigns, and assets have the greatest marketing effectiveness.

Increase marketing effectiveness across channels
The old web analytics measures are just a proxy for what we really want to measure, how well we engage our visitors and how effective our marketing is. In the past web analysts had to infer whether a visitor was engaged. Engagement analytics measures a visitor's level of engagement by their actions and behavior so it is valid and more precise. Since we can use the same engagement value metric across channels it gives us one number with which we can compare all marketing channels that end with a conversion on the website. This breaks down the silos between marketing channels and enables us to spend our marketing dollar more effectively.

Multiply marketing when combined with web analytics
You don't need to throw out Google Analytics, Omniture, and Coremetrics or any of your web analytics tools. They can still help you build traffic. Add engagement analytics and you get the best of both worlds, increased high-quality traffic.

Traditional web analytics can tell you when your website is attracting more visitors and it can tell you which pages are attractive. But in today's competitive marketplace you need more. You need to use engagement analytics to learn what your visitors find valuable, when your marketing efforts are effective, and when your site visitors are engaged.

Ron Person is director of analytics of Sitecore.

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