Brands face more competition than ever across diverse digital spaces.
So how do you succeed at marketing when the rules are constantly changing? And when is the right time to tap into data as your secret weapon?
Here’s our top five favourite tips to help founders fight fair in a fluid, fast paced world.
Table of contents
- Use the right tools
- Measure your success rate
- Measure the things that matter most
- Know how long to test ideas for
- Focus on the customer
1. Use the right tools
Some of the best tools to collect data are free, such as Google Analytics and Google Tag Manager. These are widely supported, comprehensive and work well together. Most contractors and agencies will be familiar with their use, which can save you a bunch of time, so make sure you have these installed on your site and collect valuable data from day one.
Another type of key software is A/B testing tools. Most modern email platforms allow you to test and learn from email content and subject lines, and brands should absolutely leverage that power. These tools give you the ability to test rapid prototypes and value proposition messaging to help validate ideas. The return on investment is huge as they can help brands pivot before sinking big budgets into a go-to-market campaign that was never going to succeed.
The data team at 10XL suggests that to get the most from Google Analytics, there’s a few key settings you need to configure; the first is Advertising Reporting Features, which enables age and gender reporting features, the second, Google Signals, which enables cross-device tracking.
2. Measure your success rate
Capturing data for your key channels, like Facebook or Google Analytics is important, but to be truly useful you need to define what success looks like for your business and monitor it on a regular basis.
Your success rate could be a metric like “e-commerce conversion rate”, which is simply the number of e-commerce transactions divided by the number of website visitors. For other types of businesses, it might be the number of people submitting a webform and then the “thank you” page URL (to indicate completion), divided by the number of people to your website or landing page.
Setting this up can be as easy as enabling e-commerce features within Google Analytics, or creating a custom URL goal in Google Analytics, or custom conversion in Facebook Events Manager. Set these up and test them before you start spending money on media!
The cleanest way to get some insight into what changes are creating success is through A/B testing. These statistically controlled experiments are run on CRO (Conversion Rate Optimisation) software platforms like Google Optimize and VWO, and are the most optimal way to measure your success rate.
3. Measure the things that matter most
Instead of collecting data for your business like the grinch collects presents at Christmas, founders need to focus on measuring the numbers that matter to their business. As founders start out, there’s only so much bandwidth for data driven decisions; less is more. As the business grows, more supporting metrics can be added into the mix.
These are some of the most common, most important metrics we see:
- Conversion Rate (CR)
- Net Promoter Score (NPS)
- Shopping Cart Abandonment Rate
- Customer Acquisition Cost (CAC)
- Traffic Volume (Website Users)
- Customer Retention Rate (CRR)
- Customer Lifetime Value (CLV)
- Average Order Value (AOV)
- Gross Profit
- Inventory Days (for e-commerce brands)
You could also be tempted to throw a few other key metrics in there, such as transactions and revenue. Just keep in mind that whilst these are easy to track, they don’t really tell the full story of marketing profitability. Not all sales are made equal.
The cost of goods sold and return rates matter too. Will these customers stay with us forever, and will they go on to tell their friends? It’s important to understand the context surrounding e-commerce metrics like revenue and transactions. Not all revenue is equal, and some types of customers will spend a lot more with you than others over time.
4. Know how long to test ideas for
One of the most common questions we get asked is “how long should I run this test for”. There’s no quick and easy answer – it depends on what type of business you are in and how much confidence you have in the outcomes.
To quickly illustrate this, we’ll give the example of John, who runs an e-commerce Shopify store. Like many small business owners, John has a typical ecommerce conversion of 1.5% and gets around 1,000 visitors to his website each week. John has a close friend whom he goes to for advice; a maths professor who teaches statistics to university students.
John asks his friend how long to wait before allocating budget to one of his campaigns, and gets given this table, depicted below.
|Number of weeks running test||Minimal detectable effect (MDE)|
John’s friend explains it like this; his first campaign achieved an average of 15 sales per week, and in the first week his second campaign managed to pull in 25 sales. It looks like a big improvement, which got John pretty excited.
His friend told John that he needed to compare the percentage difference between his first campaign’s results, and the second. With a 66% growth in sales, it’s certainly impressive – but his other business metrics, such as conversion rate and website sessions are modest, so it will take a while to be certain about the winner. If he continues to average 25 sales per week, it will take him 5 weeks to reach an MDE number that’s lower than his percentage change number. This is important as sample sizes need to be large enough to accurately detect a winning variation, which we can tell by ensuring the MDE percentage (65.47%) is lower than the percentage difference between two campaigns (66%).
For those who don’t have a friend like John’s, you can engage an agency like 10XL to help, or DIY it using a calculator like this one: https://vwo.com/tools/ab-test-duration-calculator/
5. Focus on the customer
The whole point of marketing analytics is to understand the customer and how they interact with your brand. Founders shouldn’t just limit themselves to their digital datasets – make sure to talk with your sales team, industry partners and even customers themselves.
There is a treasure trove of insight just waiting to be ushered forth based on actual behaviour of your customers, and most of it is highly actionable. Founders can make big moves with small data, but for truly massive gains you need to get inside the mind of the customer and attack key business problems from multiple angles. That’s where strategic advice from industry experts and marketing agencies come in. We’ve been around the block and understand what resonates with customers, how to benchmark efforts, what targets to chase and how to help you close more sales.
Article written by Chris Andrew, co-founder of 10XL