Neil Mason

“The world has gone social; it’s just that we don’t know how to measure the value of that yet.” That was one of the messages coming out of the Adobe Omniture Summit here in London. Thirteen hundred people from 500 companies from 30 countries came together last week for two days to learn, share, network, have fun, and digest the views of various speakers on the issues of the day. The other message was that the world’s going mobile – “the eyeballs are moving from fixed web to mobile web” – and there’s loads of challenges to measuring that too.

From the keynotes from the likes of Christian Hernandez of Facebook and Brian Solis at Altimeter, the emphasis is that businesses and organisations need to focus on people and to understand the social consumer. Hernandez talked about “putting people at the centre” and the power of understanding how enabling social interaction can bring disruption to different industry sectors. First of all, there was photo sharing, then there was gaming, next in Facebook’s sights is commerce; social commerce. According to Hernandez, the classical shopping funnel is dead and the shopping funnel is in fact a circle from awareness to interest, to decision, to action, to recommendation, and back to awareness. If that’s true, then it’s going to play hell with those pretty funnel reports in your web analytics tool. But Hernandez said that the future of social marketing was all around measurement and data.

However, Solis reminded us that “we cannot measure what it is that we do not know how to value” and therein lies the rub. What is the value of a social media marketing strategy? Solis’ advice was to make it actionable. Social marketing is about actions, reactions, and transactions. If it’s about actions and transactions, then it’s more measurable. But at the heart of it Solis tells us that organisations need to understand the socially-connected consumer. What is it that makes them tick? What do they need or what is it that they want from you? To do this, it’s going to be important to start to segment out your social customers from everyone else and look for those differences in patterns of behavior and attitudes from everyone else. The trick is also not to treat “social” as one big lump but to also look at the different channels within social media such as Facebook vs. Twitter, because, as some of the case studies shown demonstrated, there can be interesting patterns between what people do when using the different social channels. In fact, different types of people might be using different channels to do different things, so you can’t take a one-size-fits-all approach. Segmentation is key.

Once you understand the social customer, then Solis says to introduce a social marketing program that works for both of you, and to do that you have to think like a connected customer and give them something to talk about. Often what the social customer wants (i.e., a special offer) is different from what the organisation wants (i.e., a relationship), so you’ve got to find those things that are going to work for both of you. The key thing though is to make sure that you create outcomes; a “click to action” as Solis calls it. If you have outcomes, then at least you have something to measure against.

Of course, I know that these things are easier said than done. Organisations have been struggling for years to define “what good looks like” for their web channel strategies, let alone their social channel strategies, but defining the expected value is the critical starting point to building a social media measurement strategy. By defining the value, you’ll be able to better understand the metrics that will tell you whether that value is being obtained, and therefore the technologies can give you those metrics.

This article was orignially published by Clickz

We all dread the weekly report. A spreadsheet arrives in your inbox, crammed full of numbers, perhaps a few charts, maybe even some attempts at ‘data visualisation’ but usually without any narrative or explanation. You look at it and think “So what?” So what is it telling you and so what are you going to do about it? We’re not short of numbers. We’re short of understanding about what to do about the numbers. As analysts, we’re complicit in this. We have a habit of sending out data rather than insights. We’re good at reading numbers but not great at telling stories. We need to be telling more stories because people remember stories and they rarely remember a piece of analysis.

But what are the ingredients of a good story and how is that relevant to analysis?

Stories have a beginning, a middle, and an end. When it comes to delivering results of a project in a presentation, I urge consultants to go by the old adage: “Tell them what you’re going to tell them, tell them, and then tell them what you told them.” In other words, start off by giving key highlights, tell the story, summarise, and close.

In addition to a basic structure, a story needs a good narrative. In our data-driven world it’s easy to get hung up on numbers and to have slide after slide containing tables full of numbers and complex graphs. The storytelling analyst will understand the narrative and will find a way to tell the narrative in an engaging and memorable way. Often, less can be more. Fewer numbers can give greater insight if they are the right numbers. Less precision can lead to more confidence. “67.3% of visitors…” can almost appear to be too precise and can leads to challenges around data accuracy, whereas “two thirds of visitors…” takes the data issues away and the focus is then on what the two-thirds of visitors did or didn’t do or think.

The storytelling analyst will also develop the flow. Stories have a cause-and-effect relationship. There are events and then there are consequences. Otherwise, the narrative is just a series of events and there is nothing for the listener or the reader to take away. In the book ‘Elements of Persuasion‘, Richard Maxwell and Robert Dickman define the elements of a good story as:

• The passion with which the story is told
• A hero to drive the action
• An obstacle or an antagonist to challenge the hero
• A moment of awareness where the hero realises how he can overcome the obstacle
• A transformation in the hero and the world around him

It can be difficult at first take to see how these elements might be incorporated into the delivery of a piece of business analysis or research, but it’s worth thinking about it. Passion is possibly the easiest in a way. A good analyst will be interested in the business and will have empathy for it. He will understand the consequences of the events that he’s describing and the relevance of them to the audience.

The story’s hero could be business customers or a segment of them. One technique might be even to personalise the story around an individual or groups of individuals by using pen portraits or personas. This can help bring the story to life and increase its relevance. The obstacle that the hero needs to overcome would be the point of the research or the analysis. The moment of awareness would be the insight from the research and the transformation would be the consequences from the recommendations accompanying the analysis.

So, next time you send out the weekly report or deliver analysis, ask yourself “What’s the story here?”

This article was originally published by ClickZ

When is retention not retention? When it’s just reacquisition! More and more companies are paying attention to customer lifetime value and how they can build on their investments in winning new customers. This applies equally to consumer organisations, business to business organisations, and membership organisations. All the heavy lifting has been done getting that new customer on board, but how can we generate more value and how does customer data analysis help do that?

The role of customer data analysis in retention is to increase the propensity that a customer will do business with you again at a lower cost than the first time they did business with you. There are two things going on here: increasing propensity and lowering costs. Increasing propensity is about making yourself more relevant by getting the value proposition message across. The more relevant you are, the more likely that someone will come back again, and by analysing your customers and their preferences, has the potential to make you more relevant.

In the digital world, we’re seeing a lot more use of classic offline retention strategies such as RFM (recency, frequency, monetary) analysis. RFM is a type of behavioural segmentation approach whereby customers (or visitors, or members…) are categorized on three dimensions:

•Recency – how recently someone transacted

•Frequency – how frequently someone has transacted in the past

•Monetary – the value of those transactions

The idea is that you can develop different strategies for different segments depending on where they are on each dimension of the RFM model. If someone is high on all three dimensions, then they are the most valuable customers that the company has and the retention strategy is to keep trust. There may not be a need for masses of activity as they probably have a strong affinity to the organisation or brand. However, they need nurturing and looking after, but you don’t need to “re-acquire” them. Customers who have low recency but high frequency are ones that are slipping away. Some kind of reactivation strategy is going to be needed to bring them back and it’s possible that that might require some kind of incentive.

Customers who are high on the recency axis but low on the frequency axis are new customers and they are a particularly interesting case. The main challenge for an organisation is to get them to buy again, and what customer buying theory shows is that recency is the strongest predictor in this model of whether someone will transact again at some point in the future. So if someone has just transacted with you, then that’s the best time to try and get them to transact with you again. That’s why in the retail catalogue world if you buy something you tend to get a new catalogue with your order.

Completely new customers are a special case because they generally require the most effort to get them to buy again. Once someone has transacted three or four times, it doesn’t take so much effort to get them to transact again. So getting someone who has bought for the first time to buy for a second time is incredibly valuable. In some of the work that we’ve done and I’ve seen others talk about, there is a strong correlation between someone’s propensity to transact again and the time that they receive some form of marketing communication. Again, this is really relevant for new customers; the quicker you can get some form of relevant message to them, the more likely they are to buy again.

This article was originally published by ClickZ

You may have noticed the digital world panicking a little in the last month. On May 25th a new piece of EU legislation is coming into force which will limit the way websites collect data about their visitors and will restrict some industries in how they monetise that information. In particular the legislation is focused around website cookies.

Cookies are small snippets of code that sit on your computer and identify you to a particular website or advertising network. Currently cookies are used in a huge variety of ways from remembering what you just put in your shopping basket so that the product is still there when you checkout, through to targeting specific adverts to you based on your previous browsing habits. The new legislation says that website owners should be getting explicit consent from visitors for their data to be collected in this way, used at a later date or even sold on. In effect visitors have to say they are happy for cookies to be dropped on to their computers by websites.

The legislation has its origin in considering how brands and advertisers should be allowed to use data they collect about us consumers as we browse the web. Should brands remember information about the products we browse, news items we read, how we prefer to personalise websites? Should they be able to use that data to sell us other products and services? Should they be able to sell that data to third parties? What is private and how much of our browsing history should remain private?

 Behavioural targeting

The EU legislation is not designed to ruin the user experience of surfers, nor to impact businesses with waffly laws. Simply the EU is trying to get the digital world to be on a similar footing to the rest of commerce, advertising and marketing. The direct marketing industry has been coping well with data privacy issues for many decades and the digital industry needs to be able to say in a similar way that it is responsive around individual’s privacy and reactive to their needs with regards to any data collected about them. The impact of the web on our lives has meant we are much more connected than before but consequently those connections mean we are leaving a trail of activity in a huge variety and number of places. It is this paper trail that the legislation is trying to get to grips with.

The average consumer is happy to have cookies that support their user experience, e.g. remembering that I live in Stoke Newington and providing me with local news and weather. This type of cookie isn’t going to be impacted by the legislation because it can be argued they are required to deliver a specifically requested service. But when cookies are used for behavioural targeting it can be a bit more off-putting for the average person and this is where the legislation will really affect our industry.

Recently I’ve been ‘stalked’ by Clarkes and John Lewis adverts wherever I have been on the internet. This is because when visiting their site some weeks ago they dropped a cookie on my computer and shared that data with a third party advertising network. The network now uses that information to recognise me and fires me adverts for the same products I looked at last month. If these type of cookies are not going to be used it could mean the death of some new digital industries that were expected to drive the development of online advertising. Could this be the end for whole industries such as re-targeting, behavioural targeting or multivariate testing?
 

How did the legislation develop?

During the last 12 months a number of industry insiders have been working with the government to help define how the legislation should be implemented. The government has stated that not all cookies will be subject to the legislation. If they were then it would mean that we would need to be served with a pop-up window asking for cookie consent nearly every time we clicked to a new web page.

This usability nightmare scenario was squashed by the government but with a rather broad statement that the legislation does not apply to cookies that are ‘strictly necessary’ to provide an explicitly requested service. This generated a lot of argument that have not yet been satisfactory resolved debating if automatic settings in your browser would be enough or if sites whose existence that depended solely on advertising could be exempt.

What next?

The upshot is a rather sensible wait-and-see policy from the UK government. They have been working with advertising bodies like the IAB, EASE, ASA to review current uses of cookies and support moves by industries such as behavioural targeting to educate consumers and move to an industry standard for behavioural ads. By 2012 expect to see a small icon in any behavioural ad to show that it has used cookie data to target you.

But with the legislation coming into effect in a month what should you do next? Large brands need to get an idea of how pervasive cookies are on their sites and also how third parties which may be advertising on their site are collecting data and subsequently using it. If your advertising or media agencies aren’t able to give a confident response on how they are proposing to react to the legislation then it is probably time to look for another agency.

Since the autumn of 2010 at Foviance we have been researching what impact this legislation is going to have on brands and also how consumer attitudes to data privacy are likely to develop in the next few years. With the legislation in mind we developed a tool that grabs cookies from a website visit, analysing the type of data being collected by the cookie and rating this data in relation to how likely the legislation will impact it.

It has been fascinating and eye-opening to see the huge number of cookies that a typical website uses and the wide array of uses of these cookies. Using this approach we’ve been able to help our clients understand how the new law is likely to impact them across different types of cookies they use such as advertising, functionality and social media. I think it is fair to say that the impact of the legislation on large brands is going to be huge.

What about consumers? Most people think the internet is free and don’t understand that website owners need to generate revenue to support the delivery of content. Consumers also need to be educated in how data is collected, otherwise distrust will set in and people will never be happy to share their data. If that happens then slowly the amount of data and quality of that data that is collected through cookie technology will decrease dramatically. So, time for the digital industry to proactively engage and lead in the privacy debate.

For more about Foviance’s Data Privacy Audit

This article was originally published at My.Customer.com

In many cases organisations are still struggling to get the return on investment in their digital analytics that they were originally hoping for or could reasonably expect. Ten years on from when web analytics started to go mainstream, why is that still the case? If we look at the possible reasons, they tend to lie in the “triumvirate” of  technology, people and processes.

A lot of organisations have access to web analytics technology and have invested in it heavily over the years. The introduction of free services sparked by Google Analytics over 5 years ago means that it is cheap to acquire web analytics technology. For organisations with more sophisticated requirements such as the ability to integrate web data with other data sources and system, the enterprise market satisfies those needs. The technologies have developed significantly over the past few years and provide richer analytics, particularly in the area of behavioural segmentation, than they did a few years ago. There are still areas that are not addressed well generally by web analytics technologies, notably the attribution of acquisition channels. And while it’s great that the technology provides are adding additional functionality particularly in the social media arena, acquisition attribution is an area that it would be great to see some development in.

It wasn’t that long ago that it was generally recognised that organisations were underinvesting in getting enough of the right type of people into their organisations. Avinash Kaushik’s famous 10/90 rule he posted on his blog made the point admirably. We have seen organisations invest more in people more recently and significant web analytics teams exist in many large advertisers or digital property owners. Investing in people remains a problem naturally for smaller organisations with smaller budgets and resources, but if at least it becomes part of someone’s job, then it signals a degree of commitment.

To some extent, experience and qualifications remains a problem on the people side of things. Web analytics is still a relatively young marketing discipline and even the “veterans” in the industry have less than 15 years or so experience in the field. Again, this is evolving as organisations like the Web Analytics Association continue to develop education and certification programs. This will help to define “what good looks like” when it comes to web analysts and provide a means of reference for organisations to assess the quality of potential staff and suppliers alike.

So whilst there are still opportunities for improvement in the areas of technology and people, I think that process remains the Achilles heel of web analytics in most organisations. Process is really about how the technology and people are applied within the organisation to make a difference about the way the organisation does business. The problem often begins with a lack of process around the setting of goals and objectives so that correct key performance indicators can be set. This not an analytical process, it’s a business process and therefore is one that the business as a whole needs to buy into. This process operates at all levels from setting objectives for the channel as a whole, through to setting objectives for product development or down to individual campaigns. It’s the process that sets the analytical agenda within the organisation.

Processes then need to exist to maintain the quality of the data that is being collected within the organisation. A lot of effort can be spent getting a new technology in or applying an existing technology to a new website but it’s vital to have processes in place to maintain the integrity of the data. Digital channels are never static so continual effort is required to ensure that the data being captured reflects the latest developments. This means plugging analytical and measurement processes into the heart of the product development or campaign development processes and seeing data collection as being a core component of those processes rather than as an aftert thought.

The other important processes required are the ones that embed the data and insight into the decision making process. Optimisation is all about “test, learn and adjust” and the “learn” bit needs to be integral to that process. The challenge here is how to ensure that the analysts and their data are brought into the loop, and the challenge for analysts is to ensure that they can add value to the discussion. Part of the issue here might be about where analytical functions sit within the business and how they interact with their peers and colleagues. There are no easy answers to these organisational questions, but all the investments in technology and people will be undermined without consideration being given the way that the data and insights are capitalised upon.

In many cases, the hard investments in technology and people have been made, but the returns will be realised when the process issues are addressed as well.

This article was originally published on ClickZ

Many organisations see the digital channel not just as a way of selling products and services but also for servicing their customer base or providing additional product support. There are obviously potential advantages to both customers and organisations to allow customers to be serviced online, as well as through traditional channels such as the branch or the call centre. For customers, it allows them to access their accounts at a time of their choosing from wherever they happen to be. For organisations, it generally provides a cheaper way of serving customers, though often considerable investment is required to develop and launch online servicing applications, so how do you know that you’re doing a good job?

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People who run non-transactional websites have a tough job evaluating the success or return on investment. In contrast, if you sell stuff online or have a clearly defined transactional environment, then it’s relatively easy to assess whether things are working or not. You can count the number of transactions or you can use metrics like the conversion ratio to work out how effective the site is in turning opportunity into value. But what about all the cases, like information sites or support sites, where there aren’t any clearly defined transactions? What happens then?

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Surveys are really powerful ways of gaining great insight into your customers. Well managed surveys can help you get a greater insight into who your customers are, to some extent how they behave, but importantly what they think and why they do the things that you do. In the digital space there are a number of ways that you can collect customer feedback using surveys either on the site itself or by email if you have the relevant details. The cost of survey data collection can be quite low and there are many different survey technologies out there to choose from. But what makes a successful survey? Here are some thoughts:
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