How much data do you analyze in your marketing and communications programs? How much data do you simply let slip away, like sand through your fingers?
Consider what we have at our fingertips:
- Social media data by channel, such as Twitter, Facebook, YouTube, and more
- Website analytics data from Google Analytics
- Media data from publications such as impressions and readership
- Paid advertising data from ads, both digital and analog
- Marketing automation data such as leads and lead activity
- CRM data about our customers
- Product and service data from our eCommerce or merchandising systems
- Enterprise management data from our ERP systems
The sheer amount of data we own is daunting. How do we make sense of it? What’s most important? Where do we even start?
One of the first analytics lessons we teach our team at SHIFT to address these questions is this simple, yet overlooked, maxim:
Fix the most broken metric first.
Make an Operations Funnel
While funnels are dead (good riddance) when it comes to how customers make their journeys to purchase, funnels still make sense from an operations perspective inside our company. Why? Because we must still specialize in order to scale effectively.
With specialization, we divide up the different data pools that measure our interactions with customers. For example:
- Impressions, surveys, and awareness at the very beginning of the journey
- Interactions, engagements, conversations, and micro-conversions in the middle of the journey
- Macro-conversions such as leads, filled shopping carts, sales, and deals won at the end of the journey
Once we’ve analyzed our customers’ journey to purchase from us, we will put together a simple spreadsheet of metrics for each stage.
Fix the Most Broken Metric
Once we know the metrics for each stage in our operations funnel, we measure the percent change from stage to stage.
For example, suppose we had this marketing operations funnel:
Above, we see the operations funnel from top to bottom. We also see that the transition which is performing most poorly is from lead to opportunity. If we fix this transition, we will have significant impact on our business; additionally, there’s a good chance that we can create more powerful change with a poorly performing metric than incremental gains against a better performing metric.
For example, suppose we were to increase our audience with a massive public relations campaign and added a million new people to our audience. What would be the impact?
Instead of 700 sales, we’d eventually yield 933 sales, an increase of 233.
What if, instead of fixing something that isn’t terribly broken, we increased our conversion from leads to opportunities by the same 33% as the PR campaign, from 5% to 7%?
We’d yield 1,021 sales, an increase of 321.
Other Marketing Operations Considerations
In marketing, it’s generally easier to create positive change as we dive down the operations funnel. We have more control towards the bottom of the funnel than the top; we have almost no control over what a reporter says about us, but we have complete control over what one of our salespeople says.
However, the corollary is that the higher up in the operations funnel our worst performing metric is, the more benefit every operation beneath it sees. For example, if sales closing deals is the problem, we won’t improve the performance of our marketing lead qualification program. However, if we give our prospect remarketing program a boost, everything else beneath it in the operations funnel will see increased benefits.
By fixing the most broken metric, we increase the results and impact of all our marketing and communications efforts.
Christopher S. Penn