Measuring Marketing Success - Putting Metrics into Action

Episode 13. Across the Pond- Marketing Transformed.

Measuring Marketing Success - Putting Metrics into Action

 

Part-one recap:

CHRIS LAWSON:

Our first part was looking at the metrics. The ones that we thought any business couldn’t do without. We came up with eight, we were aiming for seven categories, but we came up with eight. We’ll see if that comes back to haunt us or not but first one, was around business performance, ensuring that you’ve got the key drivers of growth. CPA, corner stone or the acquisition strategy if not the whole strategy. Measuring behaviour change- that was one you felt passionate about, wasn’t it Sam?

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SAMUEL MONNIE: 

Yeah that was a big one, so we spent some time on that.

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CHRIS LAWSON: 

Customer satisfaction, making sure you find and can identify your evangelist. Brand equity and health, being clear on your values and making sure your authenticity comes through. Retention, something we’ve spent a while on, on a number of episodes measuring that life time value and beyond. And internal identification and culture, working on your capabilities first, again another passion centred view. 

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SAMUEL MONNIE: 

Absolutely, and we spent a bit of time so dig into episode twelve if you want the juicy details on how we brought that to life. 

CHRIS LAWSON: 

And finally, the conversion funnel. Measuring right from the top of the funnel, through to measuring that customer experience. So, this episode is going to focus on what do you do with all those metrics, how do you measure success, tools of the trade and some of the pitfalls to avoid as well, and innovative approaches to measuring success. 

 

Do KPIs waste too much time?

 

CHRIS LAWSON:

I think an interesting thing is: I’ve spent a lot of time in large organisations where a whole week, if not more, can be spent preparing the KPI’s, and then another few days presenting them. That could be part of the regular reporting cycle on a monthly basis or certainly on a quarterly basis if you’re answering to shareholders. And you have to ask yourself whether we’ve spent a week’s resources and a week times however many analysts, in delivering whether we would actually move faster. Are KPI’s there to make people reassured that something is going on or are they actually there to drive a business? 

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At the opposite end of the scale you get organisations that focus on one or maybe three key metrics and you’re going to get some teams that will go into that in more detail but having that one to three key metrics really helps to keep the organisation focused. It almost becomes a mantra of just one thing that you’re focused on, or at least have as your north star. But that’s all very well if you can simplify your business down to that, but some businesses are complicated or cover various different parts of the value chain and you can lose some of their details. 

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So, I think that we recognise that the practice is somewhere in between, and KPI’s are there for reassurance, an early warning system to allow you the space to get on with the job in the first place. But I think it is a challenge, you have to keep reflecting and looking at whether your KPI’s are doing the job that they should do, and KPI’s evolve wherever you are in that business cycle as well. Is Brewdog over in the States Sam? 

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SAMUEL MONNIE: 

…Tell me more, tell me more about them.

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CHRIS LAWSON: 

So Brewdog started out as a very passionate craft beer, now getting absolutely huge in the UK and I think definitely international expansion, if they’re not in the States they will be soon. The chief executive started Brewdog with this great phrase ‘Don’t start a business start a crusade’, as a rally call, his name’s James Watt and he’s co-founder of Brewdog.  That was the rally call to the next generation of young entrepreneurs looking to create that sort of disruptive start up, and that focus on culture, passion comes out clearly. His call for Brewdog was to make other people as passionate about great beer as they are. That for me is a really strong, rallying call. And I like that, and if you can get that through that’s brilliant- but how do you keep them honest around that? How do you actually measure that? I bet that’s a great KPI in itself.  

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I was reading a job description of a planning analyst at Brewdog (always a great source of information by the way if you want an insight into a company) and  number one in the job description was you own your numbers and use them to drive improvements within your role and across the business. And I think that’s key for me. There’s no point in having all of these KPI’s if you can’t do something about it, and if they’re too detailed or too vague it doesn’t do anyone any favours. So, I think owning your numbers, giving the listeners a first step in how you pull that together and how you own the numbers is critical Sam. So, what’s the best dashboard you’ve seen in action, and why did it work so well? 

 

Chris and Sam’s dashboard of dreams…

 

SAMUEL MONNIE: 

Great question, the best one I’ve seen was a one pager. Often people are scrambling, it takes a few weeks and you have twelve different things coming back. So, it was one document that had six drivers and it concluded the internal team and culture and mindset metric in this scorecard. That brought a smile to my face, kind of lifted me up, lifted my spirits because I thought ah there’s something they’re doing special here because they’ve already got that on here. So, the six metrics that they had on their score card were financials, market share, brand innovation, which we talked about in the last show, communications and the team and culture. But what was apparent was it meant that the discussion wasn’t led by finance or supply chain, it was a forum where multi disciplines had a role and were expected to deliver and participate. So PR, communications, innovation, HR, they were all valued and included in whatever forum, discussion, meeting to talk about the scorecard happened. It forced the scorecard and dashboard to not be all about numbers. It kind of sounds counterintuitive to say it’s not all about numbers.

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There are numbers in there but there must be room for qualitative discussions and the behaviours and mindsets that can’t always be crunched in a spreadsheet and given a number or percentage. The interesting thing is the team and culture measures included things like manager excelling, regretted losses/departures, so people leaving the organisation they were tracking that as a metric of retention of loyalty and engagement, employee engagement was another one. So those measures were all showing up in that scorecard. There was another one in terms of what skill or development areas that you as a team need to invest in in order to achieve that growth. Why wouldn’t you have that as a metric? The development/capability side was in there. They were all measuring themselves against it, they were holding themselves accountable for it. 

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I think the question you asked me was why it worked, and I think it worked because it got the whole company to see one thing, refer to one thing and have it all at the front of the mind. And it was in one of the markets we operated in within an organisation that I was working at, and it was interesting because there was some resistance to the idea. So it showed up in pockets of the organisation, and sometimes at the highest levels there was some resistance and this was more of a democratic scorecard that was more inclusive. Your CFO wasn’t driving it or supply chain leader wasn’t driving it, and you basically had to bring everyone to the table and you had to work in a collaborative way. For me, that’s why I loved it and why it worked so well in that geography because everyone owned it. Once everyone owns it, clearly everyone’s driving towards the same mission, the same agenda. 

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CHRIS LAWSON: 

Yeah, transparency, collaboration and ownership. Again, were coming through.

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SAMUEL MONNIE: 

How about you Chris?

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CHRIS LAWSON: 

A similar theme I think, mine was a one-page dash board used at The Guardian to look at daily sales. It would look at competitor share, year on year, week on week, month on month trends, both physical and the digital product. But it was a commentary that brought it to life.  I think its an important point that a lot of this isn’t just around the numbers, it’s about the interpretation and how you energise that as well. It was a presentation that the performance manager was a guy called Simon Doggett, very charismatic guy who was a performance marketing manager and he pulled it together and the key was that eighty percent of his preparation time was spent externally exploring competitor and market contacts to bring the picture to life, not internal navel gazing. It was then that ability to deliver the news in a thirty-minute flat session with the editor, with the deputy head, me as the CMO and a variety of other people, that made it so powerful, it was that short time scale. I’ve got to say though that a simply produced, visual, interactive dashboard is key, whatever the market, whatever the company. Inspired Entertainment, which produced insight for about twenty countries in the world and umpteen partners, has a huge reporting pack in some shape or form.

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I had an excellent team of analysts and data scientists headed up by a friend of mine, Nik Medirrata who now owns Med Analytics, and it was a difficult role and a really challenging environment but what he did well and continues to do well is bring that data to life again. It’s simple KPI, it should tell a story and be enjoyable to look at, not that heart sagging moment when you look at a page and think ‘what am I meant to be looking at here’. So, back to that same thing that we talked about before, metrics are one thing but it’s the insight that needs to go with it that’s important, and full disclosure, Nik’s a friend of both of ours.

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SAMUEL MONNIE: 

He is indeed. Mr Medirrata, great friend and great at what he does so I love the stories you're telling about how he brings it to life and makes it actionable for people.

 

How to be good at your job by the ATP duo

 

But he’s a good example of someone who is actually passionate about their trade and I think you look for that in your teams. You look for people who enjoy what they do and performance marketing managers that have focused on those funnels that actually enjoy looking at the statistics and understanding whether they’re going up, down or side-ways is an important part of the metrics in itself; it’s up to that personality to bring the figures to life and it’s your job to end the figures I think, and therefore individual marketers should create their own KPI set that they use to run their own job as well.  I think sometimes it’s amazing delving in, having conversations with some of your team members, what do they use to track formal measures can be quite powerful as well. So, Sam, I think that is a pretty important set of principles to adopt, to make sure you’ve got the best practice. Any thoughts on that?

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SAMUEL MONNIE: 

Yeah, you’ve kind of laid out some good sound principles out there, helping us go a bit further, as you know Chris, I often talk about how this is as important as what you do, so I’ll go deeper. There’s a few further actions I think people can take when putting together their measurement approach and plan. 

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1. First thing I would say is ensure there are actual linkages throughout the metrics you choose. It sounds obvious, but often you’re struggling to link one number to another number or another decision, so if you have business targets, then you need to know what the behaviour change is to drive that. So, if it’s a million dollars then how many people and how much are they spending to get you to that million dollars. If you can’t really calculate that or you’re not sure, don’t have any evidence and data for what’s driving that, then you probably need to think again and go back to the starting point. So, no matter what you have - can you see the linkage between them? It’s less about reporting the number of impressions or the number of click throughs, it’s more important to explain how they link towards what the shopper is actually doing, or what the next page that they should see on the webpage should be, or what information you need to show them when they click on it should be. That’s what I mean by the behaviour change and the linkages.

2.  The second one, is to tighten the metrics as you go along. So that you can leverage data to drive your decisions. What that means is you don’t need to have all the answers and be precise or perfect right away, as you build more evidence or more explanatory factors then use that data. But the point here is you’re measuring and bringing in the evidence via a real source. You’re not making up or guessing. Or if you guess from the beginning and you’re still guessing three years later, know that’s not a good thing, so what data reports that opinion. 

3. Thirdly, especially for larger organisations, you have to ensure there’s cross functional contribution; everyone needs to contribute to defining the metrics. I’ve been in so many situations where different teams have their own spreadsheets of data and so everyone has metrics, everyone has spreadsheets, everyone has their file So now you’ve got seven different versions or eight different versions with everyone claiming they have the numbers, but not once have they sat down and tried to link them up or join them together. The break through comes when you actually get together, compare, discuss, debate and contrast. You dint have to agree, but you have to align behind the decision. I’ll repeat that. You don’t have to agree, but you have to align behind the decision.

4.  The fourth one, keep it simple. We’ve talked a lot about different ways and different approaches, in the last show we talked about seven other measures again, we enforce some of those here, in different score cards I talked about one with six metrics.  If you keep a simple one pager, then it can work. I’ve been in an organisation where you have thirty/forty/fifty different drivers all on one page and well … Let’s just say I never saw updates of the scorecard because it was a paper exercise and no one wanted to update it because it was so hard and impossible to track everything. So, if you’ve got fifty things, you’re measuring it, unless your like Uber or Google or some super-duper company with mega resources, if you’ve got fifty you’ve probably got forty-two or forty-three too many metrics.

 

CHRIS LAWSON: 

Yeah, I think everyone can identify with that one. And I think you also need a forum to ask the fundamental questions that you can’t do from reading a KPI pack or a metric pack straight from the page. And that question is “why?”. Market share is up or cost per click is down; often we sit in those meetings where we’re listening to performance and we’re thinking about our section and what we’re saying next, and we nod sagely or shake our head, without thinking “why?”. And don’t stop at that first answer, ask why again, at least another three times before you get to the nub of it, I think. 

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So, my top tip is creating a forum for performance and the metrics, not just receive them. And that can be a fifty minute stand up you don’t have to do a long meeting, but you’ve got to challenge them to really get to what it means. Google analytics is a great example of a reporting suite that has grown and grown and grown, it’s intuitive it does a great job in allowing you to understand what’s going on and do your own investigation. Facebook analytics also is strong, although some of the measures are a little bit more difficult to get your head around and see how they apply but makes a lot of sense. And there’s a number of different quasi, sort of measurement quasi platforms out there, Hot Jar is a good example of the tool, where you can evaluate or look at that conversion funnel and it’s very very metrics heavy, and increasingly used by a number of start ups and scale ups that I’m working on and are quite reasonably pricied as well. But let’s not forget good old Excel, God knows how long Excel’s actually been around these days but it is incredibly powerful and it is a bit like that great adage about how the iPhone four or five years ago could have coped with launching the first man into space, and the humble Excel spreadsheet can still be integrated effectively and still give you a good, clear dash board and it can cope with a huge amount of data. 

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So, before your sold your data warehouse solution and reporting suite, I think it’s important to have a look at what you can do, and there’s a lot of skills around that can do that quite effectively, certainly more effective than building a great data warehouse and reporting suite, so look what you can do using the free, start up orientated tools or the classic bedrocks. And you know Google sheets will do a similar role, but I think it probably needs a bit of work to make it as user friendly as Excel. 

 

Effective and Free?

 

SAMUEL MONNIE:

Yeah, building on the free software out there, I tend to use Google Trends to settle arguments or influence people, we’ve all been in meetings where the most important persons been spouting about something with no facts just opinion. So if you want to quickly regain control of the situation on what to call a product or what flavour to launch or what’s popular with your target, you can quickly go to google trends, see what words or topics people are actually searching.  I always love the search and SEO folks in companies, they always have a wealth of data and insights behind them, so that’s a quick tip or trick, pull up google trends, sell the argument, move forward, sell data to that opinion party. 

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Thinking ahead then, there’s a quote from Tanya Joseph from NationWide Building Society and it stands out to me because she said, ‘marketers need to make sure they have set aside enough money to provide the evidence and insight, they need to deliver impactful campaigns confidently and consistently.’ And I fully agree you need to be asking yourself questions such as do I have a tool in place that can measure this? Am I willing to fund a new tool to capture this lift or this change? Will this plan be successful if this is the only metric that I move? 

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So, if you don’t have plans in place to track it, is it a good metric? Are you going to be fund it? if not, probably not the best metric to pick. I’ll give a shout out to one of the tools for the metrics that I’ve raised for brand health and it’s called Brand Asset Valuator.  It’s a methodology I’ve had a lot of success with, relating to brand health and really does a great job of putting real data and actionable attributes and insights, and elements into branding.  It helps you figure out how to meaningfully differentiate and what’s relevant or not to your consumer in relation to your brand and category. 

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Another tool, which was more of an approach for the internal cultural metrics we talked about would be simply leveraging annual rewards aligned to the principles and values. So, make your reward a really simple process, so the form or submission process is just one page at best, and the entry could include things like what was done, how it was done, collaboration insight etcetera and what impact it had on business results. So, those are a couple of ways or methodologies or resources I’d say, to help you measure your marketing metrics. 

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CHRIS LAWSON: 

Yeah, impact so critical there. So, when we talk about modern day marketeer’s dashboard Sam, I see it as something that is real time, it’s responsive it can bolt into a number of systems and figures, its visual, its mobile and it can be shared, and it should include everything from our desert island last week. But you want the individual channel in this to be passionate about the KPIS’s as well. 

 

Killer KPI!

So, Sam we’re running out of time, so just before we end, one of the things we said we were going to cover, the KPI quiz time, I set you some homework, one killer KPI that you like a lot, what is it and what does it mean and let’s try to do this in about a minute. 

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SAMUEL MONNIE: 

Well, hopefully you’ve heard from my sentiment throughout this show, it’s called Report and React and it’s as simple as it sounds. So, for everything in the dash board, scorecard or spreadsheet, is there truly a process to regularly report and analyse it through insight and accountability? So, basically what actions being taken and by who? You’ll be surprised when you ask that question there’s silence and people are looking at each other but no one’s actually owning the measure. So, Report and React. 

 

CHRIS LAWSON: 

Nice I like that. Mine’s Lifetime Value Divided by CAT, I’ll get to what the C.A.T stands for in a minute. The lifetime value, that’s basically the average revenue that a customer is going to make over a lifetime, as simple as that. And you divide that by the C.A.T, the Cost of Acquiring The customer, that’s all your marketing costs and expenditure and divide it by customers. And why it’s really strong is that it gives you a ratio, a really simple indicator and it demonstrates that a good measure in terms of your marketing investment in terms of how much revenue you are going to get over time. Three over one is good. Four over one is even better. If you can get five to one you can probably invest more to grow faster and so, it’s back to one of the principles we talked about early on, the back of the packet analysis then you’ve got a simple measure and you can delve into that in a little more detail. So, that would certainly be my one. 

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Three key take outs and reflections

 

SAMUEL MONNIE: 

I would say you need to have

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1. one team collective buy in and the inclusion of everyone in the process of pulling together your metrics. 

2. Second one is, insight and action is critical. So not just about measuring it but you need to translate that data into insight and take action on it. 

3. And the third one simply is, a journey. You need to have appoint of view but its about continuously improving. Don’t seek for perfection, it’s about progress not perfection. So, having a point of view and going through the journey is critical in this process. 

 

CHRIS LAWSON: 

Yeah, makes a lot of sense, and I think if I were to add another one on it would be

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  4. don’t disregard the human aspect. Bring the information to life by storytelling make it energising and exciting, either visually or   by telling the story. 

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So next show we’re going to tackle a huge subject concerning the industry right now and that’s about can marketing and advertising gain trust with consumers, how do you operate in the absence of trust. There’s a variety of stories that we’re looking at, and how do you fix that and win consumers trust back and which brands are living up to that gold standard. So, bit of a change of direction but I’m really looking forward to it Sam, it’s going to be great. 

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