Q3 2013 Takeaways: Advanced Measurement Continues To Be A Key Initiative
The end of a quarter forces me to reflect on what I learned in regards to my coverage area: measurement and attribution. From customer insights (CI) pros and marketers, I saw an increased interest in advancing their measurement approaches. On the attribution front, there is an appetite to learn about specific methodologies, use cases, ongoing attribution management strategies, and attribution applications to marketing/media buys. On the vendor side, I saw more advancement in tools, approaches, and offline and mobile data integration. I predict attribution — and general consumer and marketing measurement — will continue to be a hot topic for marketers and CI professionals well into 2014. Specifically, I expect to see more attribution adoption and usage of attribution to measure customer purchase paths and to learn more about customer behaviors and motivations.
In the meantime, let me recap the Q3 2013 measurement takeaways:
1. CI pros do not use attribution to measure the impact of the customer purchase path . . . yet. The immediate benefit of attribution measurement is to measure the true impact of marketing and media efforts, allowing marketers to change their marketing strategies and their media buys. Attribution can — and should — be used to identify and value profitable customer purchase paths, helping marketers identify different tactics to engage high-value customers. It’s just not happening . . . yet. Resources are too hampered by proving the value of each marketing and media investment to even think about the possibility of using attribution as a way to measure different customer purchase paths. I do predict that CI pros will leverage attribution approaches to better measure different consumer paths, forcing organizations to rethink how they interact with each customer, across different points of the life cycle, and forcing them to provide relevant content and offers based on what they know is working — and what isn’t.
2. Attribution is still nascent. Marketers are uneducated about attribution because it’s a complex measurement approach with large implications on how organizations operate and interact with their customers. I presented and facilitated a panel discussion on attribution during NY Ad Week and polled audience members on their use of advanced, statistical attribution models. The audience response was startling: Most still use last-click measurement. We need to continue to educate the measurement community on different attribution approaches and the benefits of a more sophisticated, focused measurement approach. Expect to see more measurement experts tout the benefits of attribution to the market, forcing brands to consider revising how they measure success.
3. B2B marketers are hungry to use attribution. Adoption of attribution measurement in the B2B community is extremely low because of their complex, long buying cycles. However, attribution for B2B marketers provides a quantitative approach to help prove the value of marketing. For B2B marketers, implementation and management of attribution measurement is a foreseeable challenge because of long sales cycles and the complex relationship between the sales team and marketing team. Expect to see more focused measurement approaches and attribution case studies from B2B marketers in the future, as their sophisticated use of measurement and analytics continues to grow.
4. There is confusion between marketing mix modeling and attribution. When I completed the Forrester Wave™: Marketing Mix Modeling, Q2 2013, I received an influx of inquiries from brands about understanding the difference between marketing mix modeling (MMM) and attribution. They have two different use cases: Marketing mix sets and optimizes the marketing and media budgets, while attribution is a backward-looking measurement approach that accurately measures the impact of each tactic at a very granular level. What became apparent to me in Q3 is the need for more education on how to effectively use both approaches together to measure more effectively (attribution) and to plan and optimize more precisely (marketing mix). Ideally, attributed values would inform the mix models, so the mix models can optimize more effectively. Like a harmonious circle of life. But very few sophisticated data-driven organizations are doing this. In the coming months, expect to see more and more MMM service providers and attribution vendors attempt to help marketers bridge the gap between these two approaches.
5. Measurement and privacy is top of mind. Measurement experts are in uncharted territory when it comes to privacy and the implications for measurement and analysis — especially with the explosion of big data and consumer-generated information. My colleague (and industry privacy expert) Fatemeh Khatibloo and I had a lengthy discussion about the implications of privacy on attribution and consumer measurement. We anticipate more inquiries and more interest in 2014 on the role of privacy in measurement. For now, we don’t see a direct privacy impact on measurement, but that could change. We’d love to hear from you — the marketers — on the biggest privacy challenges you’ve encountered while trying to measure and analyze your customers and marketing performance.
6. Big data and measurement is starting to gain traction. Big data has long been a technology discussion, but I’m starting to see more and more inquiries about how firms are successfully integrating big data sources into their core consumer measurement techniques. I expect more CI pros to leverage these sources to further understand customer affinity, in conjunction with their behavior. I’m authoring a measurement vision doc (due out in late October, early November), which addresses the future of consumer measurement and how firms should use different data sources to learn more about their customers. Hopefully, the content will shed light on how to further advance your measurement and insights.
As you can see, measurement is a top priority — and investment area — for brands. Let’s continue to converse and guide each other on this complex journey to better understand efficiency, effectiveness, and customer behavior.