The Art and Science of Marketing Measurement

10 May 2016 269 views

I’m old. But long before even I was born, the physicist Isaac Newton helped the world appreciate the remarkable principles that govern cause and effect. Newton’s Third Law of Motion states that “for every action there is an equal and opposite reaction.” So, when we sit down on a chair, we understand that our body will exert a downward force on the chair, while the chair, we hope, will exert an equivalent upward force on our backside. When it doesn’t, we may experience a sudden downward motion and have to buy a new, stronger chair. And start making more use of that expensive gym membership.

Newton’s Laws work in the world of physics because it is a perfect science, where mathematical principles define exact relationships between things.

Marketing, on the other hand, is anything but a precise science. At best, it’s a heady mix of art, science, and a large dose of guesswork. If Newton was in charge of marketing, each time someone saw a good display ad there would be an equivalent reaction. This might be a precise, measurable increase in brand awareness or intent to buy. But, sadly, marketing doesn’t work that way. We have no means of ever knowing with certainty what effect one action has on another. Put simply, in digital terms, a click doesn’t equal a sale. It never has, and it never will.

If this is true, why do we place so much emphasis on marketing metrics and measurement? The answer is simple: every participant in a business venture needs to demonstrate the value they create. Without proof of a return on investment, marketing is reduced to a cost centre, and a very expensive one at that. So we create metrics, KPIs, scorecards and more reports than you can shake a stick at.

With sufficient data tagging and spreadsheet magic it’s possible to present metrics aligned to Newtonian thinking, showing how an exact numbers of views, likes, or clicks translates into a precise amount of revenue. This makes us feel good, and occasionally gets the ROI monkey off our back. But can we really, hand-on-heart, have complete confidence in those metrics?

Imagine this scenario: we sell shoes and our data tracking tells us that Mrs Newton, a newsletter recipient, clicked on an article then visited a web page. She then she downloaded a product catalogue, before placing an online order for a pair of SooperSlippers. Great news, we got a sale! But do we really know the true impact that each touchpoint had on the end purchase? With first click attribution, our metrics may show that our brilliant newsletter has delivered some revenue, but are we telling the whole story?

What marketing metrics cannot show is the effect that external forces may have played in Mrs Newton’s journey to purchase. Scorecards ignore anything they cannot see or track. While visiting our website, Mrs Newton printed out two pages of our catalogue, not for herself but for a neighbour. She also chatted about our comfortable footwear (and lousy newsletter!) with a friend while walking the dog. When she got home she posted a photo of Mr Newton’s tired old slippers on Instagram and read comments from strangers about the slipper brands they love. And then, when Mr Newton got home from the physics lab, she told him it was time to get some new slippers and he, not she, ordered a pair online because the webpage was already open on Mrs Newton’s laptop.

Yes, we got a sale. But did the newsletter win the sale? It surely played a part, but have we captured the value of the neighbour who also placed an order thanks to the catalogue printout from Mrs Newton. Or the dog walker who is now thinking of buying a pair for their dad? Or those Instagram users who now know our brand exists?

We refer to touchpoints that are beyond the measurement capabilities of our tracking and analytics tools as “dark” and, perhaps surprisingly, they represent the vast majority of content sharing today. Far from being a digital population driven by public, online content sharing, studies show that almost a third of social media users only share via dark channels. This means they never share within a social network, but may sometimes be motivated to pass on content in other, immeasurable ways. Around 70% of all content sharing today is “dark”; we cannot measure it and we likely never will.

Marketing is a long way from Newton’s perfect, mathematical laws. At best, we can measure perhaps a third of the full impact of our communication work. And even then we can never really be 100% sure if it had a positive or negative impact. The vast majority of other impacts remain hidden away from our measurement tools thanks to the rich diversity of real-life, human-to-human interactions.

Done well, marketing communications have the power to spark extraordinary changes amongst vast numbers of potential buyers. But being able to measure one action (a click, a download, a Like, a whatever…), does not enable us to comprehend all subsequent reactions. Or, put another way, measuring something never tells us its full effect.

What does all this mean for marketers looking to master measurement and metrics? Should we throw our arms up in the air and surrender all hopes of proving the worth of our profession?

No, quite the opposite. Tracking what we can and intelligently trying to attribute value to each part of our marketing plan remains a crucial skill. But we also have to layer above this a sensible, grown-up understanding that if our marketing communications work is done well, it will have a far broader impact than we will ever be able to measure.

And if Isaac Newton were still here to ponder our modern marketing profession, I like to think he, and his slippers, would agree.

Allister Frost is an award-winning marketer and Course Director for the Chartered Institute of Marketing. He is Managing Director of Wild Orange Media Ltd.

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