Last year I had an article published in Catalogue e-business magazine (July 2008) under the ‘ask the experts’ feature; the topic being:
“What ecommerce marketers should be measuring & how to do so”
Over the course of this week, I’ll publish the content of that article here in two parts, with some extra comments and observation added. It at a quite basic level, but provides a good introduction to measurement & analytics for marketers new to the world of online.
Part 1 – Why Measure?
As is being realised more and more in today’s technology driven, fast paced business world – the web can be a highly effective marketing mechanism. It allows seamless communication and interaction with customers on a personal level, allowing companies to market to their customers in new ways. Not only is it effective in its execution of campaigns, but an element often overlooked by many companies new to this form of marketing (or even in some cases to those who have been doing it a while), is that with the right implementation, practically every aspect of its performance can be accurately measured. This in turn, gives marketers a robust feedback loop to their campaigns – the likes of which has never been seen before.
Online marketing is one of the fastest growing marketing sectors with more and more companies leveraging to this form of marketing. In the UK alone we spent £4.2 billion to July 2007 compared with £2.34 billion in the previous year . It is also becoming an increasingly competitive space, and as the playing field is level, even smaller companies with the right strategy and implementation can outperform some of the bigger players online. The number of households online is growing (61% of UK households in 2007 – 7% increase on 2006 ) as well as the audience widening (ABCDE ) – providing essentially a consumer ‘playground’ for marketers to test new ideas and campaigns. Unfortunately with this great opportunity also comes many potential areas to get it wrong – all of which may have a negative impact on a business.
Increasing competition means that pay per click advertising becomes more costly, natural search and affiliate marketing become more important – so we must work smarter not harder. Analytics is fundamental to any campaign; ensuring that whatever media investment we are making, it is the right one.
Establishing Measurements
In terms of measuring, with all the options online gives, marketers must first decide their key ‘primary’ measurements – those that are most important to them, their relative market, business and growth strategies. These measurements then give marketers and the team as a whole clear direction. Are they trying to migrate more offline customers to the web (potentially via web incentives and promotions)? Increase average order frequency and encourage repeat visits through loyalty programmes? Campaigns can be performance measured and controlled throughout the process, ensuring the optimum response is achieved and adjusted to compensate for. These are direct marketing principles effectively applied to a retail environment 24×7.
At its most basic level, measurement must include key top line metrics. Overall visitor numbers, conversion rates, frequency of purchase, time online, and page information (interest, entry & exit points) can provide enough information to understand how a site is performing, and also establish some KPI’s. These can then act as a baseline going forward, and monitored regularly based on changes to a site or marketing activity. Entry and exit points can give a good insight into where visitors are landing on your site through search, and also highlight area that maybe potentially losing too many visitors.
One thing to remember – measurements need to be decided before undertaking improvements, campaign activity etc. An initial baseline needs to be set and a control measure taken before anything is undertaken in order to measure improvement!
Metrics you should be measuring (at a minimum):
- Unique Visitors
- Conversions (could be orders, sign ups, enquiries, brochure requests etc)
- Online Conversion Rate
- Sources of Traffic (Referrers)
- Referring Keywords (What people are entering on Search Engines to find you)
- Key points visitors Enter the site
- Key points visitors Exit the site
At the advanced level, key metrics can be filtered and manipulated as required – how long visitors spend online before a purchase, optimum number of product views before a purchase, the common customer journey through the site (and performance analysis of each stage), performance of onsite keyword search and other functionality, detailed analysis of the purchase process – even going so far as to measure which precise form field was last filled in before a visitor left the checkout process. All of these metrics can be used to keep tight control over things like bounce rate and cart abandonment, and ultimately ensure purchase conversion is at maximum.
In any recruitment campaign our objective is to get that ‘first order’. Consequently our strategies include landing customers directly onto product pages in order to minimise the number of clicks to purchase and checkout. These customers no longer enter at the homepage but throughout the site. A comprehensive analytics setup is the only way of determining (in the event that the campaigns don’t work) as to why they don’t work.
Once these metrics have been established, more detailed marketing measurements can be taken into account and applied – segregating visitors by channels (direct, advertising, natural search, email, etc) and measuring performance of these groups individually. By looking at these different channels, a site can be analysed specifically for a certain type of visitor – you may find for example that ‘direct’ customers find your homepage great and view three or more products, but those who come in via your non-brand natural search content suffer high rates of drop-off after one or two pages as their expectations are not being met.
Part 2 coming soon…
The post What to Measure Online & How – Part 1 appeared first on Tudor House.