An Agency Perspective: Shifting the Measurement Mindset to Drive Growth
While digital marketing is a key focus for many brands, understanding mobile’s true impact on business can be a challenge. We sat down and spoke with Merkle’s Chief Growth Officer, Adam Lavelle, about rethinking measurement approaches to drive real business growth.
Mobile technology enables customers to discover, learn, and buy any time they want to. Marketers are capitalizing on this by delivering digital marketing strategies to meet consumers in these moments of need. But with mobile taking center-stage for many brands, a new set of challenges has arisen around how to quantify digital’s value and capture growth opportunities. We chatted with Adam Lavelle, Chief Growth Officer at Merkle (a leading performance marketing agency) to discuss how they help clients not only measure the impact of digital campaigns, but also drive real business growth.
Google: How do you think the shift to mobile has affected today’s marketing mindset?
Adam Lavelle, Merkle: As people’s interaction with media evolves, so should the marketing mindset. Many of our clients are surprised when they see how many people go all the way through to purchase in the mobile-verse. It’s a huge shift in consumer behavior, not merely a device trend.
At Merkle, we don’t view mobile as a channel: we view it as a state of being. It is a part of the context of the user. So, what device am I on? Where am I? What time is it? What situation am I in? All of these signals provide an opportunity to deliver personalized experiences, and as marketers, our job is to try to address these moments with the right content.
Understanding customer intent is critical to delivering on the customer need. What are some of the other signals that marketers can use to deliver personalized customer experiences?
Search behavior is one of the most powerful signals we have because it shows us consumer intent. But there are a variety of other signals that can be layered with intent to provide an even richer, more relevant experience for consumers. Weather, traffic, store location, inventory by location—there are so many sources of relevant data. Google talks about the importance of delivering on people’s needs in an I-want-to-know, -go, -do, or -buy moment. Merkle sees this as being about triangulating our knowledge about the customer with the brand and any other relevant data signals we have available to us. When we combine all these data points, we can deliver an even more relevant experience that’s good for the customer and the brand.
Many marketers don’t act on location signals because they are fearful that technology and measurement are too complicated. That’s simply not the case.
Location is a particularly powerful contextual signal. How do you think brands can capitalize on the ‘near me’ phenomenon?
I am a proponent of the micro-moments concept, especially the idea of ‘near me’ or I-want-to-go moments when people have local intent. The consumer conducting a ‘near me’ search is highly qualified and valuable. He’s already done research and is out and about hoping to find the thing he wants. But he may be thinking, “I’m not going to go the two extra miles down that highway through those four crazy lights and around the mall traffic unless the store actually has the thing I want. I guess I could call, but I’m not sure I want to wait to talk to someone and get the answer. I just want to quickly know if they have it in stock.”
When a customer is close and interested, it’s critical to know how to use mobile marketing to drive engagement and visits, and hopefully conversions. Being smart in addressing ‘near me’ searches can do this. Many marketers still miss this opportunity to act on location signals because they are fearful that technology and measurement are too complicated. But that’s simply not the case.
You’ve reinforced that the path to conversion is definitely different now. It’s often multi-moment and multi-channel. How do you advise advertisers to evolve their approach to measuring conversions across channels?
Everyone knows that the last customer touchpoint probably doesn’t deserve all the credit for the conversion, so we assign value to many sale-assisting touchpoints. We call these ‘micro-conversions,’ and they include things like email sign-ups, store locator usage, clicks on location extensions, call center engagement, and chat assisted sales. These are important indicators that someone is going to take a follow-up action.
To best understand the customer’s path across these ‘micro-conversions’, we’ve moved into new tracking tools, like e-receipts. Merkle embeds a pixel in the customer’s email receipt which we can tie back to their online activity. We also invest in offline tracking tools, such as Google Store Visits, to map in-store purchases back to online activity. Online and offline work together; you can’t look at these channels in isolation.
Here’s a good example: We helped Mattress Firm better understand their customer’s path to purchase. Initially, we found that when measuring all digital spend against e-commerce only, the budgets didn’t reflect the full impact. We worked with the client to expand what we’re measuring to account for more of the assistive actions, and connected the dots to in-store purchases via e-receipts. The result is a very healthy return on ad-spend, as well as growth of both the digital program and our client’s business. Taking a more holistic view is key to understanding what’s working.
Rethinking measurement sounds critical—yet it’s potentially a pretty monumental change. How can advertisers make progress?
We help our clients with an iterative test-and-learn approach to figure out what really drives growth. We believe that 70—80% of your effort and spend should be on your sure performers, 10—15% on things that could, with optimization, be strong performers, and 5—10% on innovative opportunities.
The testing component is key. It’s often not a great strategy to dive in blindly without some knowledge of what you’re trying to achieve and what sort of baseline you’re trying to affect. That’s especially important when it comes to mobile. It’s a very personal device, and maintaining trust with customers is important. Marketers have to test their way into the mobile marketing that works to stay on brand and gain the customer’s trust.
There’s this assumption that the more data you have, the better your marketing will be. But you have to ask: is your data measuring the things that drive growth?
How else do you help your clients shift from what they historically measure to measuring the things that drive growth?
There are a couple critical shifts marketers need to make.
First, they need to rethink the metrics they’re tracking. There’s this assumption that the more data you have, the better your marketing will be. But you have to ask: Is your data measuring the things that drive growth?
Many organizations end up tracking metrics that aren’t true KPIs. Cost per acquisition, impressions, and time on site are perfect examples of yesterday’s metrics that may not support growth. Brands have to connect the dots and make sure they understand the value of different metrics relative to important business KPIs, like sales and lifetime value. That way they can make investment decisions that drive growth.
The other thing is that you have to commit to shifting within the organization. Generally, different people are responsible for individual channels—like search, web, email, display—and are judged on the performance of that channel. It’s rare to see a marketer who is responsible for a specific audience, like millennials or high value customers, but we see that as the more effective way to do digital marketing. The idea is that you have one person whose job it is to deliver an entire experience across multiple channels to one type of audience. Measurement strategies that come out of organizing this way can be more effective.
Finally, what are the top two things you would advise marketers to do in order to refocus on growth?
First, I believe it is critical to have the courage to test big. If you spend all your time merely trying to optimize things you already know work, you likely will not achieve exceptional performance. Second, you have to set internal expectations that testing will never end. If your CMO or CFO won’t explore new opportunities, you can find yourself in the rear of the market instead of the front.