Marketing’s Triangle of Truth: Any 2, Never 3!

Posted in Strategy and Analysis by Matt Carter on April 30th, 2010

 

I had dinner with a friend from my agency days in New Orleans last night.  We worked together as lowly Jr. Account Executives on a national beverage company’s regional efforts.  He laughingly reminded me of the day I whipped out, what later came to be known as “The Triangle of Truth”.   It was also the day, not coincidentally, when my career hung in the delicate balance of a client’s reaction.

The situation was one common to all advertising agencies.  The client needed a 48 hour turn-around on something that had to be mind-blowingly amazing but, due to budget constraints, refused to pay for either the expanded team necessary or the time-crunch premium demanded by our production vendor.

As the agency’s senior account executive and the client’s middle marketing manager argued, I scrawled the diagram above and passed it to my buddy whispering, “You can have any two but never three.” Read the rest of this entry »

Tags: marketing investment, Social Media Strategy
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A Peek at Terametric’s Metric Special Sauce

Posted in Social Media ROI by Matt Carter on April 23rd, 2010

 

Several companies provide multi-channel measurement capabilities.  Each has a dominant channel measurement “wheelhouse” with expansion services to measure and analyze a hand full of additional channels.  The issue is that each company measures and analyzes in terms of individual channel metrics.

While that can provide an amazingly accurate picture of the performance of a single channel, it doesn’t really provide you with an intuitive way to compare that performance with other channels to truly optimize your marketing mix.  Who’s to say that an email click-thru rate of 6.7% contributes more to overall marketing performance than 250,000 impressions?

Terametric uses a mix of data collected from publicly available, proprietary and social media sources to quantify the performance of each individual channel and through a proprietary algorithm, normalizes performance metrics into a common scoring system.  This allows our clients to:

1. understand channel performance individually and comprehensively
2. quickly identify under-performing channels and drill down into underlying factors
3. understand which channels contribute the most to total marketing performance
4. create an accurate marketing optimization roadmap to maximize marketing investment

The ability to quantify channel performance, accurately correlate it to marketing return and study changes in both over time allows Terametric to accurately calculate a company’s marketing ROI.

Let us know if you have any questions.  I’m sure some have occurred as you’ve read through this.  Maybe you wonder about the validity of our conversion of channel-specific metrics into a common numeric scoring system?  Whatever you’re questions may be, please let us know.  We’ll do our best to answer them fully and quickly.  Fire away, friends!

Tags: marketing measurement, marketing metrics, marketing roi
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Stop Measuring And Start Quantifying Social Media

Posted in Social Media ROI by Matt Carter on April 14th, 2010

 

I recently read an article on eMarketer titled, “Marketers Split on Whether Social Media Will Deliver Measurability”.  I thought this chart was a great illustration of the prevailing understanding of social media measurement.

Measurement is defined as the act or process of assigning numbers to phenomena according to a rule.  Counting.

If you accept this definition, than, the majority of marketing honchos seem to be doing just that.  Assigning numbers to a new phenomenon, social media, in an attempt to better understand it.  Using hits, visitors, and traffic statistics for a website to gauge the effects of a social media campaign is indeed measurement.

Company X launched a social media campaign and saw an increase in site traffic.  Excellent.  So what?  What does that really tell you?  Does it mean the campaign was effective?  Not necessarily.

How many widgets did Company X sell as a result of that increased web traffic?  Did aided and/or unaided brand awareness rise as a result of that campaign? Did customer attrition slow?  Aren’t those the questions that CEOs, CFOs and CMOs really want answered?

You could measure all day long and never answer those questions.

Quantification, on the other hand, is defined as the ability to give or assign value to an action.  Quantification bridges the gap between what measurement can offer and what the C-Suite really wants answered.  Quantification can tell you the value of web traffic increases. When you quantify the effect of your social media campaign, you’re determining its value in relation to the goals of your organization.

Why are so many measuring, when quantification is what they really want?

Social media monitoring tools have gained quick and widespread adoption.  They have all of these great, colorful data visualizations and slick charts that count things. These tools are fantastic at measuring. Yet, counting or measuring isn’t enough to inform strategic decisions.  For CMOs to substantiate performance and justify investment, they need to calculate value.  They need to QUANTIFY.

Social media monitoring tools count.  Terametric quantifies.

We’d love to hear your thoughts, rants and raves on the subject of measuring versus quantifying.

Check out one of our latest posts, “3 Reasons SM Monitoring Tools Can’t Calculate ROI” for a more detailed breakdown of the limitations of monitoring tools and check out our About section for an description of our quantification solution.

If the subject of ROI challenges and quantification is one that interests you, we’ve started a great discussion group called Quantify on linkedin.  Love to add your perspective to the discussion there.

Tags: social media analysis, Social Media Measurement, Social Media ROI
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Terametric signs Netezza

Posted in Social Media ROI by Matt Carter on April 9th, 2010

 

Terametric marks an important milestone today; we’ve signed on a customer, Netezza (NYSE: NZ), a leader in data warehouse appliance technology.  We’re thrilled to be working with an organization of Netezza’s marketing caliber. With a competitive set that features Oracle and IBM, Terametric will provide them with the kind of intelligence needed to maximize their marketing investment.

“With so much hype surrounding social media and so many marketing agencies jumping on this bandwagon, it’s hard to get any real sense of how to best leverage this new marketing channel – particularly in the context of the high-end B2B segment Netezza occupies”, said Tim Young, Vice President of Corporate Marketing for Netezza.  “With Terametric, we are able to measure the effectiveness of each of our marketing channels, gain insight from the wealth of data collected and ensure we have necessary balance. This means our investment in our social media marketing programs is at a level that is appropriate to the value derived.” Young continued.

Many companies seek this type of measurement from social media monitoring tools but, without true cross-channel measurement capability, these tools are quite limited in their measurement scope. No tools have enabled marketers to understand what they want to know most: the ROI of each channel.  This makes it’s difficult for businesses to know how effective their marketing strategies are and to allocate resources appropriately.

With Terametric, marketing performance is communicated comprehensively as an organization’s score, which quantifies a company’s ability to attract, engage and retain customers.  This score can then be broken down into individual, channel-specific scores.  Comparing individual channel scores allows organizations to understand the factors affecting their marketing performance and provides a valuable roadmap for marketing channel optimization.

This methodology not only quantifies the effect that one channel’s performance has on other channels, it tracks performance change over time and makes it possible to calculate marketing ROI.

Terametric also enables Tim to measure, analyze and score the social-media performance of Netezza’s competitors.  In a market filled with strong competitors, the information provided byTerametric is invaluable in helping Tim magnify the power of his group’s marketing success and keep Netezza on the cutting edge of marketing.

Tags: marketing channel, marketing roi, Social Media
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3 Reasons Why SM Monitoring Tools Can’t Calculate ROI

Posted in Social Media ROI by Matt Carter on April 6th, 2010

 

Back in November of 2009, we wrote a blog post titled “6 Common Needs Unmet by Social Monitoring Tools“.  In that post, we highlighted the following common complaints about Social Media Monitoring tools:

1. Inconsistent and unreliable data collection
2. Clumsy and inaccurate data filtering
3. Either inaccurate or manual sentiment scoring
4. Inability to do advanced demographic or geographic segmenting

We’d like to thank people like Asi Sharabi, Murray Newlands, Ken Burbary and the people at ThreeMinds Organic for inspiring and to some degree, informing that post.  Their original posts are well worth a read.  To their observations and often frustrations, we added two more Social Media Monitoring limitations:

1. Single Metric – Aggregation of data, measurement and analysis into a single, relevant metric that can quantify a company’s ability to retain and attract customers while pinpointing troubled social media channels, relative to the brand, for immediate action.
2. A reliable and accurate model for measuring online and offline investment against quantified results to achieve an understanding of true ROI.

As we continue to meet with prospective clients, the ROI question is the most often cited frustration with social media monitoring tools.  This is a capability that social media monitoring tools will never possess.  Wait, what?  Did he really just . . .yep, he did.  I’ll say it again.  Social media monitoring tools will never provide an understanding of ROI for three reasons:

1. Social Media monitoring tools are designed to monitor first and measure second. Based on user-generated search terms, social media monitoring tools simply direct a filtered flow of data from the social media space to you.  How filtered that stream is remains a subject of debate.  Yes, you can see how many times you or a selected subject were mentioned and if those mentions are increasing, decreasing or flat.  Yes, you can even compare that to competitor mentions.  Does that really give you an understanding of performance?
2. Social Media monitoring tools monitor Social Media. These tools scour the data made available by various blogs, microblogs, sharing sites and social networks.  Very few incorporate and measure more traditional channels.  Yes, some incorporate CRMs, SEO and web analytics packages but few actually integrate those metrics with social media metrics to calculate overall performance.
3. Few customers buy based on a tweet. It turns out that most customers interact with and are exposed to many channels before purchasing.  Yes, they may have heard of a product based on a tweet but, people often need to be repeatedly exposed to something before buying.  While a mention or a tweet may get someone’s attention, it often takes more to get the sale.  While Social Media isn’t often the only purchase driver, it does play an incredibly valuable role in magnifying the power of your other channel efforts.  If you can’t accurately measure cross-channel interaction, you can’t truly understand the ROI of your marketing efforts or measure the value of social media efforts.

SOCIALtality analyzes all channels with a common measurement system, allowing us to provide companies with a better understanding of which channels perform and which channels don’t.  We can also tell you which channels have the biggest impact on other channels and quantify that impact.  The ability to understand performance relationships between channels means that our ROI calculation accurately reflects the customer reality.

Tags: ROI, Social Media, Social Media Marketing, social media monitoring
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