Metrics: How They Can Benefit Your Business.

No matter what organization you are a part of, whether it be your own small entrepreneurial venture or a something larger in scale, marketing metrics are a vital consideration to the effectiveness and efficiency of the company.

As a marketing management student, I’ve gained experience in the theoretical and applicable aspects of various tools available to general public for developing and monitoring a marketing plan.

The Basics
Marketing Metrics are a way for individuals and companies to identify potential issues with their marketing strategy while also measuring the overall results of their marketing efforts, performance.

The great thing about metrics are that many of them are universal, in which majority of the reasonably educated understand what the metric is outlining, and what a change in the metric will indicate.

Let’s review some of my personal favourite metrics, while also clarifying what indicators will allow us to conclude whether or not our business successful. Essentially, we are looking at the requirements for calculating the metrics and the decision-making criteria for success.

Return on Investment (ROI)/ Return on Marketing Investment (ROMI):

 Return on investment is a common and extremely useful metric that provides the analyzer with an indication of the overall performance. This is such an ideal metric because not only does present one with great insight on the investment effectiveness, but is also versatile and so simple to perform.

Essentially, Return on Marketing Investment focuses on the same concept, but specifically acts as means for measuring the revenue generated in association with one particular marketing venture. Therefore, when calculating the ROMI, you must take the incremental revenue attributable to the marketing venture and multiple that figure by the contribution margin, then subtract the marketing investment. One last step, divide the whole thing by the marketing investment and Viola!… You have your Return on Marketing Investment.

Regardless of which formula you are using, you will develop insight on the overall profitability of the investment in question making this one of my personal favourite metrics in terms of measuring marketing strategy profitability. A rule of thumb for either of these metrics is the bigger the better. However, be wary if the result is less than 100%, as this indicates a loss from the venture.

Brand Penetration:

Of course, this metric is only valuable when you are analysing a specific brand. Essentially, this metric allows us to determine the acceptance of the brand based on purchases within a population. 

In examining the results of brand penetration calculation, a larger figure represents a better overall awareness of the product. After all, in this competitive consumer world, product penetration is critical to producing profit.

Cannibalization Rate:

Unique name for a metric, eh? Beyond its “cool” factor, this is an importance metric for businesses that launch a new line or product.  The results of this metric are presented in percentage form, indicating the amount of sales that the new product is essentially taking away from the business’s previous products.

 

Ultimately, a low cannibalization rate is ideal, as it indicates that profits from other brands won’t be negatively impacted by the launch of the new product or brand.

Redemption Rate:

Most business, regardless of if they provide services or products, provides consumers with coupons as a marketing strategy to boost traffic and subsequently profit. There is a (pretty simple!) metric specifically designed to measure the impact of coupon distribution on a particular periods sales.

 

A lot of business is complete online nowadays, and as a result, metrics have been developed to measure online success and indicate potential problems before they become detrimental.

Abandonment Rate:

This is a critical measurement for websites that offer online shopping as it acts as a warning for a poorly set up site that encourage consumers to “drop off” of the site prior to purchasing.

 

Not all consumers who create an online shopping cart are going to complete the purchase; however it is rational to assume that most will. Essentially, the lower the abandonment rate, the greater the indication that your website is performing properly.

Now that we are aware of some vital metrics for marketing, let’s address how we can come up with the required data to calculate these vital metrics. There are many viable measurement tools available online to the average Joe for free! Google Analytics and Social Mention are two of my favourite in measuring the effectiveness of brand and product awareness.

Google Analytics

This is a pretty neat tool that allows individuals to track traffic data pertaining to their websites. Google Analytics requires you to have personal access to the website you wish to track, as you must place a JavaScript tacking code on your website pages, so that the tracking program has permission to access and track the website traffic data.

So why use Google Analytics? You gain insight on your visitors, their behaviour and their interaction with your website. As a result, you can tweak your website layout and details, as well as your online marketing efforts in conjunction with the results provided by this free and detailed tool.

Social Mention

My previous blog post “The Art of Listening” utilizes this tool to “listen” to any online activity pertaining to two competing products, Colgate and Crest.

Essentially, Social Mention is a free, user friendly website that tracks all mentioning’s of whichever keyword you search for via all social media websites.

So for example: Say I search for  the keyword “ lulu lemon” in attempt to see who is chatting about this particular brand. The follow screen shot displays the results of this search:

As you can see, Social Mention tracks in real time, with the first search finding posted via Facebook only a mere 11 minutes ago! In the left hand corner there are four metrics already calculated for the viewer; sentiment strength, passion and reach.

The sentiment ratio compares positive to negative feedback on the keyword. In this case, for every 6 positive comments on the lulu lemon brand, there is one negative piece of feedback.

The strength percentage figure indicates the frequency of the keyword being mentioned. In this case, there is an 11% chance that the lulu lemon brand will be discussed via social media.

The passion figure relates to loyalty, in that it indicates the probability that people will continue to talk about the lulu lemon brand.

The reach percentage figure indicates the span of awareness of the keyword In this case, 35% of the time; lulu lemon is mentioned by different consumers.

Now that you have an understanding of the importance of metrical analysis, and the ability to gain such insight for free, go out and try it for yourself! You won’t regret it!

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Works Cited

Farris, P., & Bendle, N. (2010). Marketing Metrics: The Definitive Guide to Measuring Marketing Performance. Upper Saddle River, NJ: Ft Press.

Google Analytics. (2011) Retrieved from: http://www.google.com/analytics/

Social Mention. (2011)  Retrieved from: http://www.socialmention.com/

The Art of Listening: Colgate vs. Crest

To get a greater understanding of online marketing tactics, I decided to focus in on two comparable brands, Colgate and Crest. In doing so, I used listening devices and spied on online activities pertaining to the two comparable brands.
First and foremost, I wanted to get a feel for consumer perceptions on each brand. I used expotv.com to get an idea of the average rating for products of each brand and to take a look into some of the common reviews.

Colgate User Perceptions:
Average rating of 5/5
Mild flavouring
Great value
Gel Whitening options
Contains triclosan

Crest User Perceptions: 
Average rating of 5/5
Tastes good
Various flavour options
Many whitening options that work
Contains fluoride

Findings
Both brands are doing a lot in the advertising sector, with loads of coupons and deals being publicized daily through various online sites. In all of my listening searches, I used the keywords “Colgate toothpaste”, or “Crest toothpaste”, rather than just the brand name. This was done to avoid counting unrelated products.

1.       Twitter

The Colgate account is very timely in replies and seems to take complaints well, from what I’ve witnessed. However, content is less unique and personable, giving a more generic, automated feel. Within 9 hours of following Colgate, they were following me.

The Crest corporate account is extremely personable. They reply to many user complaints and comments in a timely and enthusiastic manner. However, they have yet to follow me.

2.       SocialMention

First off, I must comment that SocialMention is such an awesome site for finding statistics about a multitude of themes in real life time. It is honestly astounding how well this site tracks valuable metrics for marketers! I compared Colgate and Crest statistics on social mentions by analysing the statistics at the exact same moment in time.

According to SocialMentions, Colgate is talked about approximately every 39 minutes. Of these mentions, overwhelming amounts are neutral comments. However, in comparing the good and the bad, the positive comments outweigh the negative, 135 to 24 (6:1 sentiment). Many of the mentions are taken from multiple sites, conveying that Colgate has social leverage amongst many fields. Additionally, it was found that there is a 7% chance that Colgate will be mentioned in social media, and 26% chance that people who are talking about Colgate will repeatedly do so.

A new mention for Crest happens every 29 minutes, most of which are neutral. There are 223 positive comments to the 26 negative ones (9:1 sentiment). Overwhelming amount of twitter mentions. Additionally, it was found that there is an 8% chance that Crest will be mentioned in social media, and 42% chance that people who are talking about Crest will repeatedly do so.

3.       Facebook

Colgate’s Facebook page was set up well, with many interactive outlets. They displayed pictures, videos and continuous updates. However, much of the updated content seemed to be auto-generated, as it wasn’t very applicable to the brand. The company offered free samples to those who `liked` the page, however, many people were posting comments complaining about not receiving these samples. At the time of my search, Coalgate had 47,558 likes and 928 people talking about the brand.

Crest’s Facebook page is not very impressive in content. I did have issues viewing the page at first, as it apparently is not compatible with
secure browsers. However, the page did acquire 107,798 likes. Additionally, 1,070 people were talking about Crest at the time of my search.

4.       Ice Rocket

Using IceRocket, I was able to search for each brand’s appearance in blogs. The results were very close, with Colgate appearing in an average of 37.23 posts per day and Crest appearing in an average of 35.1 posts per day.

Summary
It is apparent that both Colgate and Crest are leading brands in the toothpaste market. Both are highly comparable and capture large portions of the market. However, according to the listening devices I employed, it appears that Crest had a greater consumer sentiment.

I used Twitter, Facebook, SocialMentions and IceRocket as listening devices. They each provided me with relevant and more importantly, unique statistics on each of the brands. These listening devices were all fee and extremely useful, which is why it is necessary for companies to take advantage of such tools. There are more specific and greater detailed programs that cost money that can also aid in monitoring ones online company activity, yet using the
free tools it a great start.

I think it’s important that companies begin using free tools to monitor their progress. It’s from this initial information that they can discover their objectives and needs. If greater information is required, then why not ante up for a little extra?

Strategy Analysis
If I were to enter the toothpaste market, I would have a pretty hard time capturing market share as it seems to be an Oligopoly. There are only a few competitors in this market, making entry slightly difficult.

However, with the market structure aside, I would definitely take advantage of many of the tools that Colgate and Crest have already obtained. Contrastingly, I would put more emphasize on my Facebook page, as the two companies seem to have issues with their page content, recency and relevance (Crest more than Colgate).

Website References

www.icerocket.com

www.socialmention.com

www.expotv.com

www.facebook.com/#!/ColgateSmile

www.facebook.com/#!/Crest

www.twitter.com/#!/ColgateSmile

www.twitter.com/#!/Crest

Social Media Metrics: A StoneMass LLC. Analysis

Just last week, due to my status as a marketing student at Kwantlen Polytechnic University, I was given the opportunity  to participate in a lecture on social media metrics given by Michael Senger is the founder and owner of StoneMass LLC.

I was greatly intrigued by the story behind founder and owner of StoneMass LLC. Michael Senger. It was surprising to note the potential for companies like StoneMass, in capturing the revenue thrown away by people who are unable or unwilling to personally market themselves through the use of social media.

StoneMass is a provider of this feature, social media marketing, with little to no effort (and additionally, little cost) on the consumer’s part. Few companies have been able to offer such a product at low prices.

The real reason behind this post is to let you all in on some insight onto what Michael Senger, marketing guru, presented in his lecture. One of the biggest issues that Senger addressed, and hit home with, was the important of keeping up to date with marketing trends. Currently, one of the largest platforms for social marketing is Facebook. So many companies have already been advertising on Facebook, and without having that platform for your own company, you really loose out.

Using social media platforms, a company must utilize measuring metrics to contrast and compare their previous and current marketing tactics to continuously improve. The ways in which we measure metrics are through the use of KPI, key performance indicators. This is a term Senger went into great detail on, emphasizing the importance of measuring everything!

I think it would be neat to take these concepts and go a step further by comparing them to other marketing guru perspectives in the field today.

Philip Kotler
Known for his strategic marketing practices Kotler is a well-known marketer.

Contributions the marking world and recommend tools:
• atmospherics
• demarketing
• megamarketing
• turbomarketing
• synchromarketing

Kotler advises that marketers grasp the analysis of metrics to use as a means of prediction for economic situations and their resulting outcomes.

Avinash Kaushik
Digital marketing, and marketing analytics expert and author.

• Blogged about various metrics, categorized into “super lame” and “super awesome” based on their contribution to marketers.

Encourages measuring (super awesome metrics):
• loyalty
• recency
• amplification
• economic value

Discourages measuring (super lame metrics):
• clicks
• page views
• visits

Works Cited

Kaushik, A. (2011, June 28). Your Web Metrics:
Super Lame or Super Awesome? Retrieved from Occam’s Razor:

Your Web Metrics: Super Lame or Super Awesome?

Kotler Marketing Group, Inc. (2010). Philip Kotler.
Retrieved from Kotler Marketing Group:
http://www.kotlermarketing.com/valuemarketing.shtml

Stone Mass LLC. (2011). Web Site Analytics Metrics.
Retrieved October 1, 2011, from StoneMass :
http://www.stonemass.com/online-marketing-services/web-site-analytics-metrics.html