Measure the digital campaign: the 5 rules to follow
By : A&C Team Flytxt
Netflix and Amazon – what is that these amazing companies have in common? Both of them are quite successful ‘digital marketers’. They revel in acquiring and engaging with customers online. Both these companies treat ‘customer’ and ‘content’ as the pillars of their market growth. They have almost perfected the art of market segmentation. The “segments of one”: micro-segments that target each customer uniquely, allow them to convert visitors to loyal and high value customers.
Every B2C enterprise wants to extend personalised experience to its customers with tailor-made offers fitting their contextual needs and lifecycle stage. And to achieve this, they need to run thousands of daily, weekly and monthly campaigns targeting millions of customers bucketed to different segments on multiple inbound and outbound channels.
With new delivery methods and channels as well as advancements in customer data analytics, campaign management has become a complex far-flung proposition for marketers. Digital campaigns run across a variety of digital channels- email, social media platforms, company websites, communities and blogs, and on mobile devices. And as the so called ‘system of engagement’ technology become more sophisticated, digital marketing will get more automated and intelligent.
Finding order in chaos
To be successful, every marketing campaign should address audience segmentation, content development, email automation, omni – channel communication and message personalisation. These multiple, complex elements make it extremely difficult to measure the efficacy of every campaign that is executed. The marketer always has to answer the million-dollar questions as to which metrics need to be used to measure the Return of investment (ROI) of digital campaign or what should be the time-frame for measurement or what should be the benchmark of success.
While different industries would use different metrics to measure the success of their digital campaigns, which again would depend on the type of product they are selling, the type of customers they are targeting, visibility of the company in the region and acceptance of the products in the market. However as a bold attempt, we can define 5 Golden rules that every marketer could follow to measure impact while executing digital campaign
- Define expected ROI or ROO – Before running any campaign, it is very important to set the expectations clear. Return on Investment and Return on Objective are two different ideologies. Not everything can be measured in terms of money and not everything can be measured in a short time frame.
- Using Control Group – The idea of a control group is simple. Select a random (or nearly random) sample from your campaign’s marketing list and exclude them from promotion. Then measure the control group’s activity and compare it to the activity of the group targeted via a campaign. The difference between the control and campaign group gives you a pretty good notion of how effective – and profitable – the campaign is. The basic hypothesis that is put into practice here is that a certain fraction of the customers targeted are going to purchase from you anyway during the campaign period irrespective of the campaign. The control group lets you filter out that effect, as well as the effects of other channels which may be influencing behaviour, such as display advertising.
- Reasonable clicks / uptakes / purchase rate – All the campaigns are run with the objective of achieving measurable returns. It is important to ensure that conversion rate is a reasonable number. Benchmarking needs to be done with industry standards. For e.g. the average conversion rate for telecom products is around 15 %, and that for e-commerce is around 5 – 7%. Poor conversion effectively leads to negative revenues as there is always a cost for communicating to prospective clients.
- Positive net conversions – Net conversion = (Target group conversion % – Control group target conversion %). This number should always be positive in any case. Negative conversion implies that the campaign has not been quite effective and people who got standard offers are in fact responding better. This can also result in customer dissatisfaction as he/she may be getting wrong offers. This could also result in revenue loss due to the added cost of the campaign which was not successful in the first place.
- Uplift in net customer value – It is critical to compare value generated by the customers with their historic contribution say last month/year. Only if the customer contributes higher to margin and value, he will move up the value chain.
Performance improvement expert H. James Harrington once said, “Measurement is the first step that leads to control and, eventually, to improvement.” Measuring the effectiveness of a campaign helps to provide deep insights into it is performance – in terms of reception and conversions.
Consistent measurement efforts will help to alert the companies as to which ideas should be replicated and which should be discontinued. It also provides credibility to the companies by demonstrating that digital marketing campaign is both a powerful and worthwhile investment if all its elements are executed well and measured too.