Introduction to Marketing Intelligence - Part II

The
Metrics

And
Why
They
Are
Important
To
Marketers

HTTP://EMAGINE-GROUP.COM BRAND FOCUSED, SOCIALLY ACTIVE, DIGITALLY ENABLED

‘‘Half
the
money
I
spend
on
marke)ng
is

wasted—the
problem
is
I
don’t
know

which
half.’’

-‐
John
Wanamaker


‘‘Half
the
money
I
spend
on
marke)ng
is

wasted,
but
today
I
know
which
half:
TV

adver)sing.’’


The
Metrics
That
Work

Ø  Non
Financial
Metrics
Ø  Financial
Metrics

–  Brand
awareness
–  Proﬁt

–  Test-‐drive
–  Net
present
value
(NPV)

–  Churn
–  Internal
rate
of
return

–  Customer
sa)sfac)on
(IRR)

(CSAT)
–  Payback

–  Take
rate
–  Customer
life)me
value

(CLTV)


The
Metrics
That
Work

Ø  New
Age
Metrics
(Internet
Ø We
will
have
an
in-‐depth

Metrics)
discussion
of
Internet

–  Cost
per
click
(CPC)
marke)ng
best
prac)ces

–  Transac)on
conversion
Ø Give
mul)ple
examples
of

rate
(TCR)
how
to
use
the
Internet
to

–  Return
on
ad
dollars
radically
improve
marke)ng

spent
(ROA)
performance

–  Bounce
rate

–  Word
of
mouth
(WOM)

(social
media
reach)


2008
Porsche
Turbo
Cabriolet

New
Product
Launch


The
Product
Launch

Ø  A
stamped
‘‘raw’’
metal
plate
was

delivered
to
exis)ng
Turbo
Cab
owners

to
coincide
with
the
press

announcement
of
the
new
product

launch

Ø  The
mailing
provided
personalized
log-‐
in
creden)als
and
encouraged
visits
to

the
web
site
with:
‘‘The
raw
Porsche

911
Turbo
Cabriolet
awaits
your
color

selec)on.’’

Ø  On
the
web
site,
the
customers
chose

their
favorite
color
and
ordered
a

personalized
Turbo
Cab
poster


The
Product
Launch

Ø  The
design
of
the
campaign,
integrated

with
the
Internet
web
site,
enabled

end-‐to-‐end
tracking

Ø  There
were
2,700
unique
log-‐ins
with

an
average
session
)me
of
almost
15

minutes,
and
5,670
posters
were

ordered

Ø  Interes)ngly,
there
was
also
a

signiﬁcant
WOM
component,
with

nearly
500
send-‐to-‐a-‐friend
invita)ons

Ø  The
campaign
overall
had
a
30
percent

response
rate,
and
38
percent
of
Turbo

Cab
buyers
during
this
period
received

the
mailer


The
Product
Launch

Ø  The
response
rate
and
)me
on
site
is

truly
amazing
given
the
high
cost
of
the

product
-‐
$130,000

Ø  Target
demographic:
busy
execu)ves,

lawyers,
and
doctors.

Ø  This

example
is
that
the
direct-‐mail

marke)ng
was
designed
for

measurement
and
was
integrated
with

the
Web,
enabling
the
capture
of

customer
response
data
and

iden)fying
poten)al
leads


Customiza)on
and
marke)ng

intelligence
can
have
a
signiﬁcant
and

measurable
performance
impact
for

both
small
and
large
ﬁrms


DuPont
Tyvek
HomeWrap

&

NASCAR


DuPont
Tyvek
HomeWrap

Ø  DuPont
Tyvek
is
a
well
known
US

brand

Ø  The
product
is
successful
because
of

the
innova)ve
proper)es
of
the

product
and
the
marke)ng
strategy

that
DuPont
used

Ø  Tyvek
has
a
unique
property
that
keep

liquid
water
from
passing
through

making
it
extremely
durable

Ø  Tyvek
is
used
in
packaging,
protec)ve

apparel,
envelopes,
covers,
graphics

and
home
construc)on

Ø  It
is
extremely
useful
in
the

construc)on
industry
where
it
is

wrapped
around
the
building
frame
to

keep
mold
and
mildew
out
while

protec)ng
homes
&
buildings
from

water
damage


The
Challenge

Ø  Marke)ng
Intelligence
and
marke)ng

metrics
start
with
the
principle
of

keeping
score
for
all
major
marke)ng

ac)vi)es

Ø  This
is
challenging,
since
the

adver)sing
is
designed
to
brand
Tyvek

by
crea)ng
awareness
for
the
product

and
an
emo)onal
atachment
that
your

home
is
safe
with
Tyvek

Ø  In
addi)on
to
the
print
marke)ng,

DuPont
used
the
sponsorship
of
Jeﬀ

Gordon
in
NASCAR.


NASCAR

Ø  NASCAR
is
an
extremely
popular
sport

in
the
United
States

Ø  It’s
also
very
interes)ng
from
the

marke)ng
perspec)ve

Ø  It
is
the
#1
in-‐person
atended
spor)ng

event
and
the
#3
most
watched
sport

in
the
United
States

Ø  Almost
80
million
people
regularly

watch
NASCAR

Ø  Combined
with
F1,
auto
racing
is
the

#1
live
event
in
the
world
today


Jeff
Gordon

Ø  DuPont
also
sponsors
Jeff
Gordon

Ø  Has
won
the
NASCAR

Championship
4
)mes

Ø  ESPN
rates
him
the
8th
most

recognized
sports
figure
in
the

United
States


Car
Branding


Ac)va)on
Campaign

Ø  Campaign
included
pain)ng
Jeﬀ

Gordon’s
car
with
a
Tyvek
“TV
panel”

on
the
back
for
a
race
in
Kansas
&
TV

adver)sing
blanketed
the
Kansas
area

during
the
race
to
build
customer

awareness

Ø  Primary
focus
of
the
campaign
was
on

three
groups:

–  Retailers

–  Builders

–  Specialists
in
Construc)on


The
Poster
Sent
to
Distributors


The
Offer

Ø  The
offer
was
for
an
‘‘ul)mate
race

weekend’’
luxury
box
for
the
race
and

opportunity
to
actually
meet
Jeff

Gordon

Ø  Awards
went
to

–  top
24
retailers
across
the
country

who
sold
the
most
DuPont

products

–  top
24
builders
who
bought
the

most
DuPont
products

–  top
24
specialists
who
signed
up

the
most
new
and
exis)ng
retailers


The
Results

Ø  438
retailers
signed
on

– 202
new
and
236
exis)ng

– 186%
sales
increase
during
the

promo)onal
period


The
Weakness
of
the
Measurement

Ø A
weakness
of
the
marke)ng
Ø Tyvek
logo
that
is
visible
on

measurement
was
that
the
all
new
construc)on
that

impact
of
the
brand
and
uses
the
Home
Wrap
product

awareness
component
of
the
Ø The
following
was
posted
on

marke)ng
was
not
captured
the
www.NASCAR.com
blog:

par)cularly
well


My
favorite
NASCAR
memory
includes

our
favorite
driver,
Jeﬀ
Gordon,
and
my

son,
Logan.
When
Logan
was
two,
we

would
drive
by
new
housing

developments
and
he
would
tell
us

which
houses
were
Jeﬀ
Gordon’s.


We
didn’t
put
it
together
for
a
couple
of

months,
but
every
)me
we
would
walk

by
or
drive
by
a
new
housing

development
Jeﬀ
Gordon
almost
always

had
a
house
there.


Finally,
we
realized
our
two-‐year-‐old

was
matching
the
DuPont
Logo
from
Jeﬀ

Gordon’s
racecar
with
the
DuPont

House
Wrap
logo
(Tyvek)
on
the
new

homes.
Kudos
to
DuPont
for
its
brand.


The
takeaway
is
that
the
Tyvek
Home

Wrap
campaign
primary
objec)ves
were

designed
to
be
measured;
DuPont

marke)ng
was
keeping
score,
and
the

pre-‐post
change
in
number
of
pallets

shipped
jus)ﬁed
future
marke)ng

investments.


The
Diﬀerence
Between
Leaders
&

Followers


If
you
ask
CMOs
how
they
spend
their

budget,
you
most
onen
hear
the

percentage
spent
on
TV,
print,
Internet,

direct
mail,
telemarke)ng,
and
so
on.


But
this
breakdown
is
not
par)cularly

useful,
since
it
does
not
tell
us
what

these
organiza)ons
actually
do
with

their
money.


What
is
the
intended
outcome
of
the

marke)ng?


We
want
to
know
what
marke)ng

investments
are
actually
intended
to
do

or
achieve?


We
deﬁne
5
buckets
of
funding
based
on

achieving
diﬀerent
goals
and
objec)ves
–

such
as
demand
genera)on,
branding/
awareness,
customer
rela)onships,
shaping

markets
and
infrastructure.


The
5
Buckets
in
Detail

Ø  Demand
Genera:on
–
marke)ng
ac)vi)es
to
drive
revenues

in
a
rela)vely
short
)me
period
aner
the
campaign

–  Sales,
coupons
and
events

Ø  Branding
&
Awareness
–
marke)ng
ac)vi)es
drive
awareness

and
can
include
sponsorships,
naming
rights
to
events
or

proper)es,
and
adver)sing
speciﬁcally
for
awareness,
not

promo)ng
an
upcoming
sale

Ø  Customer
Rela:onships
–
marke)ng
focuses
on
crea)ng
a

personal
link
to
the
customer
that
drives
loyalty
and

engagement

–  Thank
you
notes
aner
purchase
and
loyalty
programs
such

as
concierge
shopping
services


The
5
Buckets
in
Detail

Ø  Shaping
Markets
–
ac)vi)es
designed
to
make
the
market

more
recep)ve
to
your
products
or
services,
through
3rd
party

recommenda)ons

–  Analyst
rela)onships
for
B2B
ﬁrms
and
social
media

blogging
to
inﬂuence
percep)on

Ø  Infrastructure
–
investments
into
technology
and
training
to

support
the
marke)ng
team

–  Enterprise
Data
Warehousing
(EDW),
analy)cs
and

marke)ng
resource
management
sonware
to
support

marke)ng
intelligence
func)ons


How
Do
Marketers
Allocate
Budget?


The
Diﬀerence
–
Leaders
&
Followers


What
Do
We
Know?

Ø  The
Marke)ng
Divide
Is
Real!

Ø  There
is
a
Significant
Difference
Between
Leaders
&
Followers

Ø  Leaders
spend
less
on
demand
genera)on
marke)ng
and

more
on
branding,
customer
rela)onships,
and
infrastructure

to
support
marke)ng
intelligence

Ø  Leaders
have
processes
in
place
to
op)mize
marke)ng

management
–
it’s
not
done
ad
hoc

Ø  Leaders
have
significantly
beter
sales
growth
and
financial

performance
compared
with
the
followers

Ø  And
no
surprise,
key
marke)ng
processes
of
leaders
include

metrics
to
keep
score
and
marke)ng
intelligence


Using
Metrics
to
Deal
With
Hard

Economic
Times


When
the
economy
gets
tough,
senior

management’s
reac)on
is
to

aggressively
cut
costs
–
but
they
use
a

hatchet
instead
of
a
scalpel
–
causing

signiﬁcant
impact
on
both
short
and

long-‐term
performance


Marke)ng
may
seem
like
an
easy
cost-‐
cuxng
target
due
to
the
diﬃculty
with

which
its
returns
are
quan)ﬁed
–
but

when
you
understand
the
link
between

investment
into
marke)ng
and

performance
during
and
following
a

recession.


In
a
study
covering
16
different
industries

from
1980
–
1985,
results
showed
that
firms

that
maintained
or
raised
their
adver)sing

expenditures
during
the
1981
–
1982

recession
averaged
significantly
higher
sales

growth
during
the
recession
and
the
three

years
aner.


By
1985,
sales
of
companies
that
took
an

aggressive
adver)sing
approach
during

the
recession
had
risen
by
256%
over

those
who
lowered
or
failed
to
maintain

their
adver)sing
spending


In
the
2001
technology
industry

recession,
Intel
invested
$2
billion
in

new
chip
manufacturing
facili)es
and

aggressively
marketed
new
dual-‐core

technology
in
order
to
grab
market

share
from
compe)tor
AMD


In
2008,
three
years
into
a
recession
in

construc)on,
Johnson
Controls
rolled
out
a

new
ad
campaign
con)nuing
its
‘‘Ingenuity

Welcome’’
effort.
The
campaign,
which

included
significant
print
and
online

adver)sing,
demonstrates
Johnson
Controls’

efforts
to
build
energy-‐efficient
environments

for
customers.


The
First
Step
–
Deﬁning
the
Marke:ng

Intelligence
Strategy


The
Framework


Know
Yourself
–

Figure
out
which
data
are
important

using
the
80/20
rule:
ask
what
is
the
20

percent
of
data
that
will
give
80
percent

of
the
value?


Know
Your
Customers
–

Fine-‐grained
segmenta)on,
which
then

leads
ul)mately
to
customer
targe)ng

and
data-‐driven
marke)ng
ac)vi)es.


The
Closing


In
1974,
bar
code
scanners
were

introduced
in
retail,
and
for
the
ﬁrst

)me
this
enabled
the
tracking
of

individual
consumer
product
purchases

at
the
point
of
sale


This
technological
innova)on
spawned

‘‘marke)ng
science,’’
the
idea
that

marketers
could
quan)fy
marke)ng

using
analy)c
principles


Today,
the
Internet
and
cell
phone

networks
are
enabling
the
next
leap
in

data
collec)on
of
customer
interac)ons

with
marke)ng


Now
is
the
best
and
most

exci)ng
)me
to
be
in
marke)ng


The
new
data-‐driven
approaches
and

infrastructure
to
collect
customer
data

are
truly
changing
the
marke)ng
game,

and
there
is
incredible
opportunity
for

those
who
can
act
upon
the
new
insights

the
data
provides


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