I just did a quick count on how many blog posts we’ve had on FifthGearAnalytics.com on multichannel marketing and I was surprised to see that we’ve had over 60 posts in just the last year. Clearly the topic of multichannel marketing is near and dear to our hearts, so I looked at what we’d compiled and compared it to others in the industry. I’ve determined there are three essential capabilities that are needed to prosper in this era of endless marketing channels, new technology offerings and whole new ways of interacting with customers. Over the next several weeks I will explore in more detail these three essential skills to multichannel marketing. The three fundamental skills are:
- Touchpoint Attribution – defined by Fateheh Khatibloo of Forrester Research as the practice of using business rules to allocate proportional credit to any marketing communication, across all channels, that ultimately leads to the desired customer action.
- Customer Intelligence Hub – is the repository that integrates data from all sources and enables real time analysis on a variety of business and marketing decisions.
- Customer Engagement – is the descriptor for new marketing strategies that engage customers on their own terms.
Let’s think about these terms in a simpler way. As marketing channels proliferate, it stands to reason that we want to compile marketing metrics (online and offline), analyze our marketing intelligence to see which channels are working, and then interact with customers in ways that are most beneficial to them (and ultimately to us as marketers). Sounds simple, huh?
Maybe not. And that’s why my next three blog posts will go into each of these core competencies in more detail, starting with this one which describes touchpoint attribution and how it’s used to allocate scarce marketing resources over multiple channels.
As marketers have drastically increased the number of channels in the marketing mix, it’s become apparent that one of the key metrics used for measurement is broken and that is linking purchase activity to promotional efforts (aka “attribution”). I’ve mentioned that media fragmentation is one culprit, but there are others: the sheer amount of marketing messages, the consumers’ complex decision process and organizational challenges (i.e. data silos). However, the biggest challenge facing the new world of multichannel marketing is ourselves. Brand and channel managers want to protect their own world by doing their own tracking. After all, the old adage is true: he who keeps score, wins!
Why do we need to change? Current methods of measurement are often inaccurate and usually understate the actual cost to generate revenue and acquire a customer. In the Forrester study, Untangling the Attribution Web, an example of this is given:
Personalized URLS (PURLS) are printed on direct mail pieces; emails drive traffic;
and broadcast media spots promote mobile marketing…The result is a costly misallocation of budgets to inefficient acquisition channels.
In short, without tracking and measuring multiple touchpoints, marketers are unable to determine the true ROI of their marketing dollars! As previously noted, the consequences of not getting this right are enormous; marketing overspends or underspends, there is unhealthy competition and fighting for budget dollars, and there’s misguided investment in both people and dollars.
Very few marketers have been able to do this correctly across multiple channels. Progress seems to be the greatest when combinations of online channels are used together. There are some best practices that are being used in the online space that can be carried over in offline channels as well:
- Use one tracking system – marketers need to use one tracking system such as IDs, tracking codes and campaign codes. Universal tag systems help with consistent tracking of online channels.
- Choose multi-touch attribution models over “last click” attribution – counting the last channel (or online, the last click) is the predominant way of measuring the sale since it occurs closest to the purchase. However, as more and more channels are being used, it doesn’t work nearly as well. (See Adobe’s ebook: Attribution Modeling: A Search Marketer’s Guide, for more information).
- Connect offline channels – there are many ways to give proper credit to offline channels, such as using PURLs, 800 numbers, coupon codes, etc. These can be correlated in the CI Hub, which will be described in my next blog post.
Multichannel marketing is exploding. Mastering the three fundamentals – touchpont attribution, a CI Hub and customer engagement strategies – are critical to success. Stay tuned for the next blog post on building and using a customer intelligence hub (CI Hub).
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