For the last several years, many marketing professionals have been discussing and blogging about metrics-driven marketing. As a matter of fact, measuring marketing ROI has become its own lucrative market. Any marketing services vendor worth its salt is an ROI driven service and to determine ROI, one needs to measure metrics.
Hence, Market By Numbers. Marketing by numbers goes way beyond measuring ROI, however. “Market by numbers” also evokes an analytical, process-oriented approach to marketing.
Process-oriented and metrics driven marketing go hand-in-hand. While I wouldn’t say that such marketing derives from Engineering processes, it is similar, and is also born of analytical thinking. We’re not talking Madison Avenue here. (Not an inconsequential benefit of such marketing is the potential for a better relationship between marketing and technologists.) While “market by numbers” is maybe not so easy as “paint by numbers,” the point is that there is a process — distinct steps one can take — which provides CEOs and boards:
- business plans with tight and defensible financials;
- marketing plans with well-defined, cost-effective budgets;
- fast and optimized customer acquisition;
- well-defined, scalable, and replicable sales;
- mistakes, but assurance that lessons were learned.
So you might ask, if this is so great, why has it taken so long to get here?
In all honesty, metrics-driven marketing is not truly new. I have friends in advertising who serve Global Fortune 500 firms and they tend to chuckle at high-tech marketers who, like Columbus “discovered” America despite the fact native Americans were already living there, believe they’ve discovered something new that traditional marketers have known since the beginning of time — or at least since the beginning of advertising.
It many respects they’re right. There are fundamental principles of marketing, including branding, copywriting, advertising, direct mail, etc., which old school marketers learned by moving up the ranks of advertising and traditional direct marketing firms, and not by the trial-and-fire methods of many high-tech marketers, myself included.
But I daresay, much is new. technology itself is part of the marketing. Early adopters of computers and Internet technology represented a different market segment that required specialized outreach methods. The experience in opening e-mail vs. snail mail, for example, while the former benefits from best practices of the latter, is fundamentally different, so ultimately, must be treated differently.
Similarly, ROI tracking is not only different, but incredibly more precise. Ponder the difference between knowing how many people have visited your web site, from where they came, what search phrases they used to reach you, what ads they acted on, what they did when they arrive, etc., versus the Nielsen Families, ostensibly representing millions of viewers, reporting which TV programs they watch. It can be argued that the present advertising pricing structure is built upon a house of cards, which the TCP/IP protocol crushes.
No, marketing ROI is not new, but technology takes it to a whole new level. My first introduction to this was listening to the VP of Marketing Analytics of Yahoo speak at a CMO Council conference. (I cannot track down the woman’s name, so would appreciate it if anyone could help me out here.) This is not about unique visitors, or even what field in a form in which a user abandons registration. My eyes were opened-wide to learn that there was an entire department of mathematicians and statisticians developing internal models that reward Yahoo groups that produced products that were successful, and eliminated those that weren’t; automated resource investment and divestiture. While I’m not sure I completely agree with such a methodology (couldn’t a tweak of intuitive dramatically change the outcome?), I was fascinated by the utilization of the power of numbers.
Here, on Market By Numbers, I hope to contribute to this metrics-driven marketing discussion and perhaps touch on areas not extensively covered. I highly recommend you visit the writers listed on my blogroll, made up of industry executives with far greater experience than I, who have valuable inputs into developing process-oriented, metrics-driven go-to-market strategies.
Some of the topics I hope to cover in the coming months include:
- What marketing means to high-tech B2B start-ups;
- Details of process-oriented marketing;
- Low budget, high impact marketing;
- How to relate marketing spend to corporate objectives;
- Relationship between Marketing and Sales;
- Relationship between Marketing and Engineering;
- Your suggestions?