Intro to Incremental Measurement
How do we measure marketing value?
The standard for measurement in marketing has far surpassed counting clicks and impressions. These operational metrics may mean something to the ingrained marketer, but they mean little in terms of displaying the true value of marketing to a business. In order to display business value, marketing must be analyzed in customer behaviors that are meaningful to the business. Behaviors like new purchases and renewals or upstream actions such as lead qualifications. Metrics surrounding these core behaviors are often referred to as KPIs (Key Performance Indicators) or BPIs (Business Performance Indicators) and they provide the starting point for translating marketing performance into financial outcomes like ROI.
These KPIs and financial metrics allow us to state marketing impact in terms that are relatable to other business functions. Although this standard is vastly improved, marketing metrics are still commonly approached with skepticism. The measurement and analysis of marketing efforts are less standardized and more complicated compared to most business functions. From the outside it can look like a tangled web of data and statistics, even bold speculation to some. On top of external perception these metrics are core tools for evaluating and prioritizing marketing efforts internally. It is vital we be confident in them.
I’ve spent my career helping businesses elevate their marketing through the proper use of data and analysis. The foundation to those efforts comes from proper measurement and reporting, but these are frequently an afterthought. By incorporating processes for proper measurement and reporting in the initial development of marketing systems we can avoid complexity and guess work down the road. This goes a long way towards bettering both your calculations and their reception.
The simplest and most reliable way to do this is by designing marketing systems and processes to allow for incremental measurement. Incremental measurement goes beyond the attribution and counting of customer responses to your marketing. It helps to fairly estimate how many of those responses were caused by the marketing action, not simply a coincidence. Designing your marketing systems and strategies to leverage incremental measurement requires a foundation in those techniques.
I’m writing this blog series to introduce the fundamentals every marketer should understand about incremental measurement. I will cover a handful of topics at a level high enough for new and non-technical marketing professionals to follow. However, I also hope to incorporate enough detail to provide value for those looking to implement new or evaluate existing marketing measurement processes. The first topic I’ll cover is test & control comparison and how to generate control groups.
Interested in this “Intro to Incremental Measurement” series? What about sales & marketing analytics in general? Follow me here or on LinkedIn to find out when new posts are available.
