MarketingExperiments Blog: Research-driven optimization, testing, and marketing ideas

Email design always proves to be a hot topic with marketers. And when you have top agencies competing against each other, the fire just gets hotter as we learned during last week’s live web clinic – Maximize your Agency ROI: How adding science to the creative process reveals a 26% gain.

We received a plethora of questions, most which we could did not have time to address during the hour-long clinic. So, as with every Web Clinic Extra, we have picked a handful of the most common questions to address here on our blog. This week we pulled in Andy Mott, the Senior Manager of Research Partnerships, to answer these questions…

Email marketing is a topic that comes up often in the MarketingExperiments community. In fact, Dr. Flint McGlaughlin is delivering a keynote today at Em@il Summit ’10 in Miami as well as teaching a pre-summit Live Email Optimization Workshop. If you couldn’t make it out there this year to get valuable insights from your peers and industry leaders, come back to the blog on Friday for some key takeaways from this year’s summit.

You can view a replay of the clinic or read the latest issue of MarketingExperiments Journal. Our next live web clinic, The Five Best Ways to Optimize Email Response (Part 2): How to craft effective email messages that drive your customers to action, will be taught on February 3rd from 4 to 5 p.m. EST.

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Senior Manager Boris Grinkot recently attended the Eloqua Experience 2009 Global User Conference in San Francisco. He sat down to answer a few questions about his key takeaways for online marketers…

Q: You were the only non-Eloqua employee to have a booth in the Marketing Effectiveness Zone. Users from around the world sought your advice about conversion rate optimization. Was there any pattern to the challenges marketers brought you?

Most websites are not really having a conversation with the customer. They are not guiding the customer through the page. And, most importantly, they are not testing their pages. They may test an email message or a form with Eloqua, but they don’t test the whole page.

There is massive room for improvement to optimize landing pages to ensure they are customer-focused, and then continually improve the results generated by those pages through testing.

Q: Measuring those results was also a major topic of conversation at Eloqua Experience?

Yes. Eloqua is seeking to standardize key performance indicators, or KPIs, that CxOs use to measure results in much the same way financial accounting uses key ratios and cash flow statements, income statements, and balance sheets. Today, most measurements in web analytics – like visitors per month, for example – do not directly translate to a standard accounting metric, such as net revenue.

Q: Based on past statements we’ve received from web clinics and here on the blog, KPIs are a little misunderstood by some marketers. How can readers choose and use KPIs effectively?

In our research, we find marketers most frequently tend to look at numbers like conversion rate, bounce rate or number of visitors. While these numbers can be meaningful within the context of page or process functional performance, they don’t necessarily do a good job of measuring the financial performance.

Revenue per visitor is usually an essential KPI that connects online customer behavior to a financial outcome. While this is a more straightforward KPI to calculate for ecommerce sites, even if you have a lead-generation site, you should understand the value of each lead to determine your revenue per visitor.

Average order size can also be a meaningful KPI that helps you distinguish customer segments (e.g., collectors vs. gift shoppers) or test functional changes like in-cart upsells. Choosing the right KPIs is a big topic, but the short of it is that you need to distinguish between behavioral, demographic, and financial metrics and use them appropriately.

Q: So the important thing to remember is, that while some metrics might be useful in an intermediate step, the overall goal should be a revenue-based number?

Absolutely. For testing and optimization, you need those intermediate numbers.

For example, if you’re optimizing just one step of a shopping cart, conversion rate or clickthrough are important testing metrics. But you don’t want to lose sight of the big picture – which would be overall revenue or revenue per visitor. Let’s say you’ve optimized a step and more visitors are clicking through, but they are less motivated and in the end are buying less. If you don’t have that overall revenue KPI, and you just looked at conversion rate, you would erroneously assume that you have definitively improved your shopping cart.

Q: What are some other caveats when choosing a KPI?

Even if you choose the right KPI, you can still get bad information by not looking at individual channels. You may have good revenue per visitor, but that number is just an average. What if one channel is delivering ten times the revenue per visitor of another channel? That is important information to have, especially if you’re paying for traffic, because you need to understand how that spend converts to revenue.

Q: What is the overall benefit of choosing the right KPI for C-level reporting?

By focusing on dollars instead of traffic, business leaders gain a deep understanding about how the investments they make impact revenue generated through the website. If you invest more in a site, what ROI are you getting?

Clickthroughs and conversion rates only muddy the answer to this question. You need numbers directly related to the spend of each campaign. And not in the aggregate, but specific to a channel – so you know that investing X in PPC, email, TV, or even print will lead to a return of Y.

The other upside, which I’m glad Eloqua is pushing, is that numbers like overall revenue, revenue per visitor, or cost per acquisition bring web metrics much closer to standard accounting. These numbers give CxOs the best indicators of their site’s performance in a format they are used to seeing.

Use the comments section below or post your questions to our MarketingExperiments Optimization group.

Analytics & Testing, Internet Marketing Strategy, Marketing Q&A, Practical Application analytics, KPI, marketing, online marketing, ROI

Did you catch our free Web Clinic on Wednesday? The topic was Measuring What Matters: How simplifying your metrics can increase Marketing ROI by up to 75% — and if you joined us, chances are you’re already implementing new ideas and tools to improve your analytics.

If you couldn’t make it, you can view the presentation here and download our free MarketingExperiments Essential Metrics Tool here (Excel file).

Metrics isn’t the sexiest topic, yet it’s one that most marketers have been grappling with for years and still don’t have many concrete answers. In our live poll, 74% of the marketers characterized their experience level with Web analytics as moderate to novice.

There’s a lot more to cover with metrics than our one-hour session allowed: Different tools, the type of website and levels of data, your depth of experience with analytics, to name just a few.

Many attendees told us the big takeaway was our blueprint for distilling several data points into just four key measurements — and using that to get beyond numbers and into your customers’ mindset.

To paraphrase Dr. McGlaughlin, too often the focus with analytics is on us: the actions we’re trying to force or entice, the conversion rates we want to see, the transactions and revenue we desperately need to achieve. Those are valid measures, but they obscure the intentions of our prospects and customers when they visit our sites.

The trick is taking all those raw numbers and using them to create a snapshot of what your site visitors are thinking, as well as what they’re doing. That’s what really helps us adapt our processes and content and improve ROI dramatically.

Several attendees requested another Clinic on this topic, so we’ll likely revisit metrics with a new session in the months ahead. In the meantime, please enjoy the complete Clinic and try our Essential Metrics Tool with our compliments.

We’d appreciate any feedback you have on the metrics Cinic or Tool, and invite you to post any other metrics-related comments you’d like to share.

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Budgets are tight. Bosses are telling their employees that “nice-to-do” conferences and non-essential training and travel are out until further notice.

So here are two things to consider when deciding how best to spend that tight marketing budget.

One: Consider taking the MarketingExperiments online Landing Page Optimization course, and never leave your desk. That’s one way to make your boss happy. Training with no travel required. You can apply what you learn to your company’s site as you go, and once you pass the test, you’ll be MEC-certified in Landing Page Optimization.

Two: Consider the case for a very, very short trip to Ponte Vedra Beach, Fla. during the first week in June, when we’re going to teach a condensed version of the LPO course in just twelve hours over one and-a-half days.

Yes, this workshop will be intense, it will be a lot to learn, and it will not be easy. But when you deliver that first short, sharp, shock to your company’s online performance, believe me, neither you nor your boss will regret it.

Those who have taken our professional certification courses know how substantial the ROI can be for a company that sends the marketing ranks through them. By making carefully selected changes and adjustments to a product’s or service’s Landing Page, the certified experts who come out on the other side of our course know how to help their companies gain double- , triple-, and in some cases even quadruple-digit increases in click-through rates, conversion, leads, and revenue.

Yeah, that’s right: quadruple. Sounds like essential training to me.

If you can’t make it to Ponte Vedra Beach, you can register here for the online courses in Fundamentals of Online Testing, Landing Page Optimization with an emphasis on subscriptions, or on e-commerce, or email marketing.

Internet Marketing Strategy Email Marketing, landing page optimization, landing page optimization certification course, online testing, Ponte Vedra Beach, ROI