Archive for the ‘Analytics/Reporting’ Category
Buzz is Great…But What Does It All Mean?
- Noise is the total amount of social buzz about a brand or company. This includes every mention of that brand, no matter how trivial, along with all relevant conversations. Facebook Fans comprise part of this noise, as do followers on Twitter. Noise might encompass a lot of (nearly) meaningless fluff, but there is some real value to be found amongst the chaff. Noise serves as an important baseline for measuring future marketing activities.
- Sentiment combines human context with automated analysis of data. Because computer algorithms can only go so far in making sense of buzz, it is crucial that the data also be considered from a human perspective. For example, a strictly automated data analysis of a Twitter conversation would likely interpret as positive a string of tweets about “how great Brand X is” — totally missing the sarcasm that the actual participants all understood as an insult. Applying this human context is crucial if you want to get meaningful results from your analysis of social buzz.
- Topics allow us to classify and organize what would otherwise be an endless stream of thousands of conversations. Categorizing conversations by topic makes it much easier to make sense of social buzz. People might be talking about your product, but are they raving about new features or complaining about shortfalls? Knowing these sorts of details can give entirely new meaning to what might have previously been an amorphous social media mess. Topically sorted conversations also provide a window into what popular search terms might be.
- Where are these conversations taking place? If the social buzz is coming from a wide range of people carrying on discussions in a very broad forum, you know you’ve done something right. Conversely, if buzz seems to be concentrated among niche groups, you might want to consider more targeted marketing based on these groups.
- Who is talking about you? One tweet from an industry expert or a mention on a well-known blog is worth many thousands of conversations between low-profile spectators with no real influence.
Are Facebook Fans Really Worthless?
A recent article from Forrester Research’s Augie Ray carries the rather scandalous title “What Is The Value Of A Facebook Fan? Zero!” Of course, Ray doesn’t really think Facebook fans are worthless. But he does raise a crucial question that deserves serious consideration in our brave new world of social media-driven marketing.
Ray discusses the valuation of Facebook Fans and concludes that it is impossible to put a dollar figure on the ROI of such followers. He emphasizes that when it comes to getting a real return on social media investments, having followers in and of itself is not nearly so important as what a company does with those fans. In other words, your conversion rate is really what matters.
Marketing guru Seth Godin touched on this same topic in another recent blog. His conclusion nails it: “Commitment is the essence of conversion.” Becoming a “fan” requires little commitment and more or less amounts to being a digital spectator. But marketers don’t just want a bunch of spectators — they want participants, because participants are where you get your return! Accumulating spectators shouldn’t be an end in itself, but it does lay the foundation for conversion. The more spectators you collect, the more potential participants you could have on your hands.
But it’s ultimately up to you, the marketer, to convert those spectators into active participants.
Mastering the Metrics: Abandonment Rate
For the last installment of our Mastering the Metrics series, we will cover Abandonment Rate.
Abandonment Rate most often refers to purchases started but not completed; so-called “shopping cart abandonment” has always been an issue of concern for online retailers. However, you can apply this metric in other areas as well, the most relevant of which would be form abandonment. Form abandonment is when visitors to your site begin filling out a form but do not complete or submit the form. The abandonment rate is a measure of just one aspect of a website’s conversion rate.
You can’t always be certain of the reasons for form abandonment. It might be that some visitors changed their mind, but most frequently the problem lies with the form design. Forms that ask for too much information at once or are difficult to fill out lead to a high rate of form abandonment. Redesigning your forms to make them simple, streamlined, and user-friendly is the best remedy for a high form abandonment rate.
Mastering the Metrics: Net Reach
In today’s installment of our Mastering the Metrics series, we’ll be discussing Net Reach.
Net Reach (also just “Reach”) refers to the number of people viewing an ad at least once. This metric gives you an idea of how widely the ad is getting dispersed throughout a population. But maximizing exposure isn’t as simple as just maximizing reach. Ads with wide reach but low frequency can get lost in the shuffle, while an ad with limited reach coupled with high frequency risks overexposure — think of how many times you’ve seen the same late-night TV ad over and over, and how sick of it you’ve gotten. Strike an effective balance between reach and frequency to optimize your ad’s distribution and impact.
Total Impressions / Frequency = Net Reach
Mastering the Metrics: Visitors
In the last installment of our Mastering the Metrics series, we covered Visits. Today we’ll discuss Visitors.
Visitors are the number of unique individuals who view a website in a given time period. This differs slightly from the Visits metric in that it allows you to measure a website’s reach, as opposed to just its traffic. Visits measure the volume of traffic itself, but comparing this number to the number of visitors will help you understand what type of traffic your website is generating and what sorts of visitors you’re attracting. If you consider that one visitor can have multiple visits over a certain timeframe, you can begin to judge the quality of your visitors. For example, you can tell whether your site has a small group of die-hard fans who visit the site repeatedly and often, as opposed to just a bunch of casual visitors who stop in once for a peek but never return.
By tracking visitors and visits during a specific timeframe, you can also use this metric to measure the concentration or urgency of activity by repeat visitors. Therefore, the time period you look at can be an important factor in calculating this metric. If one visitor makes repeated visits to the site in the course of a day or two, you can bet that they’re seriously interested in your site — they may be doing research before they take the next step. These are good visitors to target and reach out to since their interest has been demonstrated by their repeat visits.
Mastering the Metrics: Visits
Mastering the Metrics: Cost per Customer Acquired
In the last installment of our Mastering the Metrics series, we covered Cost Per Order. Today, we’ll be discussing a related metric called Cost Per Customer Acquired.
Cost Per Customer Acquired measures the cost-effectiveness or ROI of advertising by dividing total advertising cost by the number of customers acquired. Cost per customer acquired goes a little deeper than cost per order in that it conceptualizes customers not just as a single order, but as a possible source of multiple orders. This metric helps marketers determine if customers are worth the cost of their acquisition and is useful for comparing to customer lifetime value.
Advertising Cost / # of Customers Acquired = Cost Per Customer Acquired
Mastering the Metrics: Cost Per Order
We will cover Cost Per Order in this installment of our Mastering the Metrics series.
Cost Per Order measures the cost-effectiveness of advertising by dividing total advertising cost by the number of orders generated. This metric is tied to successful conversions, so it applies more directly to profit than does Cost Per Click (CPC), which measures a marketing function. Ads that have strong clickthrough rates but that fail to result in lots of conversions have an unacceptably high cost per order, which is often indicative of an unconvincing or disappointing product.
Advertising Cost / # of Orders Generated = Cost Per Order
Mastering the Metrics: Cost Per Click (CPC)
For the next installment of our Mastering the Metrics series, we’ll be discussing Cost Per Click.
Cost per Click (CPC) can be calculated by dividing the total advertising cost by the number of clicks generated. The context for this typically involves search engine advertising and refers to the amount paid to the search engine for each click that brings a visitor to the advertiser’s website. The cost per click metric can vary depending on the search engine used as well as the competitiveness of the keyword(s) in question. It is directly related to Pay Per Click (PPC), an internet advertising model that uses either a bidding system or fixed price to determine the price advertisers will pay when someone clicks on their ad. Cost Per Click is most often used to measure the cost-effectiveness or ROI of campaigns.
Advertising Cost / # of Clicks Generated = Cost Per Click (CPC)
Mastering the Metrics: Clickthrough Rate
Continuing our Mastering the Metrics series, we’ll be discussing Clickthrough Rate today.
Clickthrough Rate refers to the number of clickthroughs–when a customer clicks through pages on your site–expressed as a fraction of the total impressions. Clickthrough rate measures the effectiveness of an online ad by counting the number of viewers that are interested enough to click on that ad. Because clickthroughs only represent the first step in the conversion process, this is a metric best suited to measuring medium-term marketing goals rather than the end result of a campaign.
# of Clickthroughs / Total Impressions = Clickthrough Rate
