experience matters

“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

- John Wanamaker

I can’t stand that quotation.

Even today, it is bandied about as though it has any meaning in the current world of (online) marketing. It contained some truth when it was first said, but today it just identifies the lazy marketers in our midst.

Why the vitriol? It’s because almost everything is becoming measurable. Now, there is no reason to claim ignorance to analytics – we are swimming in data.

But that might be the problem. As the recession continue to apply pressure to all industries (and on advertising and marketing more than most I would venture) there is a redoubled focus on return on investment (ROI).

And this is wonderful. The online channel is made to justify advertiser’s investments. But the advent of social media has thrown a monkey wrench of sorts into the works. How do we define ROI in a web 2.0 world? How has the landscape changed and how can we plan for tomorrow?

Where Have We Been?

For decades and decades, there was little evidence at all to prove ROI. What was the value of your PR representative annoying journalists with phone pitches? No one could say. How many sales resulted for your Times Square advertisement? No one knew.

This started to change with mass online adoption. Scores of processors and bits of code could record our every action. There were only two problems:

• Our recorded actions were throwbacks to an older era, such as “impressions.”
• Certain actions were deemed valuable simply because we had the means to measure them, not because they actually proved engagement (i.e. “hits” – any single access to a web server).

We operated under the flawed system through the 1990s and much of the 2000s, possibly because it offered better metrics than the past (read: next to none) and because it fit the web 1.0 style. We offered up content to a passive audience who had a limited ability (if any) to respond. Kinda sounds like television, doesn’t it?

Where Are We Going?

But now, we are in a different era – certainly different from the heady days of radio and television, and different even from those swaddling days of web 1.0 analytics. We’ve long passed the old media measurements and metrics from the early days of the internet because they simply don’t provide enough value in an online community based on conversation, niche groups, and viral sharing.

We need to determine some critical components: What we’re going to measure, how we’ll measure it, and why.

The good and bad news is that this will require a more personalized analytics review. Clients (the smart ones, anyway) and agencies must spend more time identifying the goals of each web tactic and how success can be measured for that tactic.

It’ll be more work, sure. But this is the information that will identify critical gaps, illuminate key strengths and weaknesses, and determine market leaders of the future.

Jeremiah Owyang of Forrester suggested what to measure in his recent report, Social Media Playtime Is Over:

“Demonstrate how social media marketing is effective during budget trimming. Don’t concentrate on measurements like page views that don’t affect the business; instead, focus on how customers have moved farther down the marketing funnel…Focus on measuring based on business objectives, not just traditional Web analytics.”

We are moving from a period of raw quantitative measurement (i.e. How many unique visitors did we have?) to a qualitative period (i.e. Did our social media engagement create more trust which in turn created more sales?). Trust, loyalty, and brand advocacy aren’t intangible anymore.

Web analytics aren’t going away. They still have some use and heck, the C-level is beginning to understand them. However, this is a moving target and you should be prepared for changes in the months and years to come.

But don’t take it from me. Your agency should be explaining these integral components of online marketing in a web 2.0 world. They are explaining it…aren’t they?

Last 5 posts by DJ Francis

• Forget 2010: Ten Marketing Predictions for the Next Decade – January 7th, 2010
• How Can A Mustache Help Cure Cancer? – November 20th, 2009
• The MarketingProfs Digital Mixer is Over, But the Work is Just Beginning – October 28th, 2009
• Employee Personal Brands – Who Is Your Human? – September 24th, 2009
• 10 Recession Marketing Myths De-Bunked – August 18th, 2009

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