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Measurement for Marketing Effectiveness – data challenges and how to meet them Trevor Jones Marketing Databasics 25th June 2009.

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Presentation on theme: "Measurement for Marketing Effectiveness – data challenges and how to meet them Trevor Jones Marketing Databasics 25th June 2009."— Presentation transcript:

1 Measurement for Marketing Effectiveness – data challenges and how to meet them Trevor Jones Marketing Databasics 25th June 2009

2 Some themes  A buzz about marketing effectiveness  Some history  Metrics for marketing basics  Getting serious about marketing effectiveness  “Common sense systematically applied”  A consistent focus on the customer  Covering measurement, not targeting/ modelling/ segmentation

3 A history of the ‘customer view’  Even the ‘early starters’ seldom have an absolutely complete view  Consolidation has been a major issue in the insurance/assurance sector – has held things back  FM sector a late adopter 3 Start of the ‘customer focus’ journey RETAIL BANKS LIFE & PENSIONS GENERAL/ CONGLOM. INSURERS FUND MANAGERS

4 Things going backwards with the internet!  Silo development  Stress on technology rather than customer management  Little integration between on-line and off-line behavioural data  A serious un-plugged gap, given the importance of on-line channel  Technology is available to plug it  But it is not just about technology, it’s about customer management on-line

5 CUSTOMER LIFECYCLERECRUITMENT DEVELOPMENT LAPSATION CUSTOMER BASE Essentially, all marketing spend supports the customer lifecycle  We recruit them  We develop them  And we try and retain them It’s surprising how often customer-centric metrics and reporting are not in place to allow a high-level assessment of marketing effectiveness to be made

6 CUSTOMER LIFECYCLERECRUITMENT DEVELOPMENT LAPSATION RECRUITMENT  Volumes and costs by channel  Characteristics  Source – increasingly difficult to measure  Downstream value?  Business health check?

7 CUSTOMER LIFECYCLERECRUITMENT DEVELOPMENT LAPSATION DEVELOPMENT  Cross-sell and up-sell statistics (and goals?)  Beware x-sell ratios!  Customer profitability/NPV  Marketing measures:  Interaction measurement  Contact densities  (Campaign measurement [primary/secondary sales])  Channel impacts/preferences  Spend by profit or  NPV  Feedback to recruitment, forward look to lapsation Precursors to campaign optimisation

8 CUSTOMER LIFECYCLERECRUITMENT DEVELOPMENT LAPSATION LAPSATION/RETENTION  Systems issues – can customers get ‘lost’  ‘Good’ v. ‘bad’ lapsation  Measurement & strategy  Value lost/value ‘saveable’  ROI on retention activities – short and medium term  Business health check?

9 What to do with marketing metrics  Agree them!  Implement them! – and make them easily accessible  Use them!  Will give you a high level view of marketing effectiveness  Beware the elephant in the room!

10 More silos, marketing measurement and getting more complicated  ATL/BTL/ONLINE marketing spend  What are they for?  How integrated is the planning?  How clearly are goals and response/ performance measures specified in advance?  Channel cross-over – some examples  ATL impact on existing customers?  Interaction between channels  Measuring the origin of web enquiries/orders  Direct measurement is often not enough

11 A time series approach  Increasingly, measurement using a time series approach is appropriate, e.g.  Marketing spend at customer level v. change in behaviour/spend  Cross-channel effects – e.g. ATL spend and internet inquiries  Separately tracking effect of advertising spend on existing/new customers

12 A new approach - a fusion of econometrics and database analysis  Typically, econometrics has been used by ATL agencies to ‘mark their own homework’  Adspend v headline sales  But by combining customer database metrics with time series analysis, the range of what can be achieved expands significantly, for example  Measuring response to all types of campaign across all channels  Disaggregating ‘new customer’ & ‘existing customer’ effect of campaigns  We call this :

13 Thank you.


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