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Marketing channel analytics

What is it?

Marketing channel analytics allows you to assess the different marketing channels available to you and establish which are the most effective. The ideal marketing channel will always be influenced by costs, the demographic of the customer you are seeking to reach and also what your competitors are doing, among other things.

It is likely that you will reach different segments of your market via different channels, but it is still crucial that you know which ones are working and which ones are less effective so you can make better marketing decisions.

Why does it matter?

Marketing channel analytics matters because there are literally hundreds of possible channels and ways to market your products and services. These range from the traditional print ads, PR, media and direct marketing to home shopping networks, guerrilla marketing tactics, giveaways to online marketing as well as social media and mobile. There is only so much time in the day and only so much money available for marketing so understanding which is going to deliver most bang for your buck is essential.

Marketing channel analytics looks at costs and return on investment so that the marketing budget can be used more effectively.

When do I use it?

It is a good idea to start with a complete analysis of all marketing activity and then create a process for a more ongoing review.

What business questions is it helping me to answer?

Marketing channel analytics can help you answer business questions such as:

  • What type of marketing is more cost-effective for reaching our customers?
  • Is online marketing more effective than offline marketing?
  • Are our prospects or customers doing what we want them to do as a result of the advertising?
  • What marketing channel is most effective?
  • What marketing channel is most profitable?

How do I use it?

The first step is to list all your current and potential marketing channels. You need to be clear about what it is you are trying to achieve with each channel. So for print advertising you might want customers to call you using the number on the advert. With online marketing you may want the customer to click through to your website or click on a banner advert. Or that may not be enough for you – you may want the customer to then add a product to their shopping basket and complete the purchase.

For each of the current marketing channels, and any potential as yet unused channels, set some conversion rate goals so you know what you want that channel to deliver.

Too often businesses launch themselves into a particular marketing channel without any real idea of what success will look like for them in that channel. And this is why there is the old marketing adage – ‘50 per cent of all marketing spend is wasted but the problem is we don’t know which 50 per cent’. We don’t know which 50 per cent because we don’t conduct marketing channel analytics and have clear targets for the channel before we begin.

And there really is no excuse for not conducting this analysis any more as so much data is available – especially online to help assess results. Advertising with companies like Facebook, LinkedIn and Twitter have integrated analytics included in the advertising so that you know what happens as a result of that advertising. And in many cases you only pay for the clicks that result in the meeting of your specified goal, i.e. make a purchase, complete a survey or sign up to a newsletter. And all this data is then available to analyse using web analytics (Chapter 47) or data mining (Chapter 6) to extract further insights.

Practical example

Marketing channel analytics is not just about identifying the best-performing platforms but also the most cost-effective.

Say your marketing channel analytics discovered that the most effective method of marketing that you currently use is direct marketing. Your campaigns consistently yield high response rates and generate significant return on investment; a reasonably close second is your online promotions.

When you take costs into consideration, however, the online promotions are a clear winner because although they don’t yield as much income they are much cheaper to implement. Direct marketing is expensive whereas online promotions are not.

Tips and traps

Market channel analytics is obviously easier online than offline. Online marketing channels are digital and often the analytics are built into the marketing platform. Effectiveness of offline channels such as direct marketing have used different codes on response forms but offline channels are also benefiting from new technology and tools. For example, retailers can put sensors in shop mannequins to count passing traffic, how many people look at the window display and who then enters the shop.

The biggest trap with marketing channel analytics is that by definition you are assessing the channels in isolation. And that might be quite misleading. For example, if I measure the success of my email marketing campaign and it looks positive, I have no way of knowing how many of those customers have already been on my website or seen a few of my blogs or read some of my books prior to getting that email. The email campaign will be credited with the positive outcome, but it might not have been the email campaign alone that caused the outcome. There are now tools that can help to appreciate these interconnections and influences such as multi-channel funnels which show how marketing channels work together to create sales and conversions.

Further reading and references

To find out more about marketing channel analytics see for example:

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