The Evolution of Response Attribution & Measurement MIS 2011 http://www.pinpoint-corp.com
Agenda • MPM & Response Attribution • The Pinpoint Methodology • Evolving Response Measurement in Campaign • Case Study • Wrap-Up / Q&A http://www.pinpoint-corp.com 2
What is MPM? Marketing Performance Measurement & Management: The methodology used to align marketing activities to achieve business objectives. Key Components: – Interaction History – Data Analytics – KPIs & Dashboards http://www.pinpoint-corp.com 3
What is Marketing Response? Marketing Response: One or more measurable events related to a marketing campaign that together define the desired behavior taken by a customer or prospect No great marketing decisions have ever been made on qualitative data – John Scully – Former CEO, Apple Inc. http://www.pinpoint-corp.com 4
Some Additional Points… • Response is not a guaranteed indicator of campaign performance • Response is an effective way of measuring channel, messaging & creative effectiveness • Output vs. Outcome: – Output – Easily accessed data that is based primarily on customer action (e.g. downloaded, clicked, sent- back, etc.) – Outcome – Forward-looking customer performance metrics (e.g. customer retention, share of wallet, product adoption, etc.) http://www.pinpoint-corp.com 5
Where do you stand? “We’re not measuring responses today and don’t know where to start.” “We’re capturing responses today, but we have no method to tie it to business objectives.” “We’re tying responses to business objectives today, but we have no consistent process on how it’s done.” “We’re tying responses to business objectives today, but it’s very inefficient.” “We totally have this figured out and I’m in the wrong track session.” http://www.pinpoint-corp.com 6
Common Approaches Approach Pros Cons • High level of flexibility • High potential for errors End-users create their own • Tie the person that built the • High levels of inconsistency response flowcharts for each campaign campaign to the capture of response between campaigns • Allows for a snapshot of the • Requires duplication of data Collect every action to • Important KPIs can get largely allow for any type of customer at time of response • Easy access to each action analysis later overlooked • Less data available on Don’t collect responses, • Simplicity customer response behavior just monitor the shift in • High level of flexibility • Rigorous design of experiment KPIs structure Mail! Baby! Mail! • Shock & Awe • Collateral Damage (Carpet-Bombing) http://www.pinpoint-corp.com 7
Recommended Improvements Approach What to do End-users create their • Automatic & centralized response capture mechanism own response flowcharts for each campaign Collect every action to • Identify necessary actions based on pre-specified measurement allow for any type of objectives analysis later Don’t collect responses, • Identifies specific KPIs for each campaign before execution just monitor the shift in KPIs Mail! Baby! Mail! • Utilize closed-loop marketing to optimize offer assignment (Carpet-Bombing) http://www.pinpoint-corp.com 8
The Pinpoint Methodology Prepare • Segmentation Plan • KPI Selection • Initiatives • Response Window • KPI Definition • Response Attributes • Response • Events • Types • Criteria • Shared Toolbox • Offer Templates Probe • Response Flowcharts Present • BI Reports • BI Report • Campaign Execution • Analytics • Contact Capture • Best Segments • Response Capture • Success Criteria http://www.pinpoint-corp.com 9
Identify Your Initiatives & KPIs • Number of products / services • Number of new customers • Net change revenue / utilization • New customer revenue Share of • Number of products /services Acquisition Wallet • Customer profitability • Customer churn Risk Retention • Write-off Potential • Net change revenue / utilization Management http://www.pinpoint-corp.com 10
Response Categories Direct Clear connection back to a Campaign (key or promotion codes) High Confidence Customer did not refer to your promotion code yet purchase the products/services offered Indirect Medium Confidence Customers did not purchase the products offered but did for other related products Low Confidence Customers purchased unrelated products during the response window http://www.pinpoint-corp.com 11
In the Beginning… Campaign Response Customized, Isolated Response Flowcharts Maintained by Marketers Response History Campaign Response Campaign Response http://www.pinpoint-corp.com 12
… And Then There was Light Campaign Single, Centralized Response Flowchart Maintained by Campaign Admins Response History Campaign Response Campaign http://www.pinpoint-corp.com 13
IT Math (End users build response flowcharts + End users validate response flowcharts + End users manage execution ) x Total # active campaigns x Total # of offers per campaign IT Nightmare (IT-managed response flowchart + Response is driven by offer attributes + Automated / lights-out execution ) x 1 response flowchart IT Dream http://www.pinpoint-corp.com 14
Case Study - Telecommunications • 7 regions, split geographically • 60+ Unica users • 100+ campaigns active at any one time • 3+ offers per campaign • Approximately 20 various products which are often bundled • Centralized response flowchart executes daily • Three pre-defined response types http://www.pinpoint-corp.com 15
Problem Description • The existing response attribution process suffered from a number of shortcomings: – Accuracy – 95% of issues in response history were user- related errors – Performance – Challenging to control system resource consumption from causing contention – Transparency – Very difficult for Campaign administrators to know what users had changed/edited – Efficiency – Errors and omissions in response criteria required major re-work – Complexity – End-users did not fully understand response flowchart logic http://www.pinpoint-corp.com 16
Response Flowchart Step 1: Identify your Contacts • Identify those that were targeted by your active campaigns 17 http://www.pinpoint-corp.com
Response Flowchart Step 2: Identify your Previous Responders • You do not want to collect responders that you have already added to your Response History, be sure to exclude them early in the process. 18 http://www.pinpoint-corp.com
Response Flowchart Step 3: Segment into Response Types • Identify your new responders and split the population into the appropriate response type flow 19 http://www.pinpoint-corp.com
Response Flowchart Step 4: Assign your Responders • Identify the responders that qualify for each of your response types and add them to your Response History tracking table. • Capture any response-time or response- derived metrics into your Response History tracking table. 20 http://www.pinpoint-corp.com
The Response Process Box The input cell containing only your responding population for a response type The date on which the response took place. (Can be static, variable, or data-driven) The name of the response type that this population represents http://www.pinpoint-corp.com 21
The Response Process Box The key, code, or parameter that you would like to use to link your response to a target. Try to be as specific as possible to limit the likelihood of mismatching to a minimum http://www.pinpoint-corp.com 22
The Response Process Box Map any fields that you would like to track at the time of response to the Response History table here These columns need to be mapped into the Response History System Mapping in advance http://www.pinpoint-corp.com 23
Lessons Learned • If you have customers receiving multiple offers at a time, you may want to consider including the offer or treatment in the audience. • Making it easy to identify response records (i.e. through simple database views) can make a big difference in response flowchart complexity • The Extract process is your friend, don’t be afraid to use it… responsibly. http://www.pinpoint-corp.com 24
Summary – Key Takeaways • Having a disciplined approach to response measurement makes your campaign performance measurement transparent and defensible. • Flexibility is directly correlated to complexity. Lean towards simplicity and evolve over time. • End user acceptance of the new process was very high. (Higher fidelity response with less effort.) http://www.pinpoint-corp.com 25
Q&A Please Stop by our booth in the Sponsor Showcase for the chance to win a Kindle http://www.pinpoint-corp.com
Appendix http://www.pinpoint-corp.com
Example KPIs – Contacts • Targeted Population • Mailed Population – Responders • Number of Purchases per Responder • Response Rate • Total Response Revenue • Cumulative Response Revenue • Revenue per Targeted Customer • Revenue per Responding Customer http://www.pinpoint-corp.com 28
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