How to Measure Digital Relationships: Marketing Lessons From “Moneyball”

[This article was originally published by MarketingProfs.]

I grew up watching all kinds of sports with my father, and to this day I love baseball. Though my brother, the other sports fan in the family, says baseball is ponderously slow, there’s something about its rhythms that I love.

I remember as a kid watching the larger-than-life baseball heroes of the ’70s and ’80s, players like Pete Rose and “Mr. October” Reggie Jackson. Back then, it was Reggie’s game—a game of big hitters and bigger egos, of smashes to left field and home runs.

But, over the years, the game changed. It got smarter. Baseball has always been uniquely suited to statistics, and, over time, player performance started to be measured in new and surprising ways. That shift wasn’t easy, and it didn’t happen fast, but eventually teams began to unlock new insights about how to win.

Dodgers game

Moneyball and Marketing

The transformation of baseball through numbers is beautifully told in Moneyball: The Art of Winning an Unfair Game, a seminal work by Michael Lewis, who is perhaps the finest narrative business writer of our time. (The story is also coming to theatres later this year in a film starring Brad Pitt.)

The story is as much about business as it is about sports. It describes how Bill James, using the statistical analysis of baseball records known as sabermetrics, along with Oakland A’s general manager Billy Beane, discovered unknown secrets to gain competitive advantage. Surprisingly, it had very little to do with paying tens of millions of dollars to a guy who could hit the ball 500 feet but still struck out three out of every four at-bats.

In many ways, Moneyball is a great model for how digital marketing—and marketing communications of all kinds—is changing right now. For decades, advertising and PR campaigns have centered on the Big Idea: swinging for the fences with a clever, provocative, or powerful concept that drove brands, hearts, minds… and, ultimately, business. How did it drive business? No one knew exactly, but the numbers—whatever their provenance—showed that it worked.

But the advent of digital has changed that. As anyone in marketing knows, the frothy talk around “relationships” and “measurability” is now part of any social media or digital marketer’s semantic toolkit. The irony? Most of social marketing spend is on advertising and influence—in other words, the long-ball of marketing communications.

Many practitioners today still think of marketing as mainly a zero-sum game. Even social media goals are transactional. The message most campaigns send? Buy this, and go away until I’m ready to send you another message. That’s thinking in terms of a campaign rather than a lifecycle.

New Performance Indicators

I liken that approach to the runs batted in (RBI) stat. RBI is the random, red herring stat of baseball. Because it measures how many runs a player has brought home, it sounds important. But look closer, as Bill James and Billy Beane did, and all RBI tells you is that the player gets hits when other people are on base. So what does really matter? Getting on base in the first place.

A stat called on-base percentage (OBP) tracks how often a batter reaches base (except when a fielder makes an error), including walks. Many hitting stats don’t count walks. But it turns out that in baseball walks matter—a lot. The more hitters can avoid striking out and force the pitcher to give them a pitch to hit or to walk them, the more players are on base. The more players on base, the higher the likelihood of runs and more wins. That’s why a walk can be just as valuable as a hit. But before Bill James, that kind of common sense didn’t apply.

New performance indicators like OBP have fundamentally changed baseball. Despite the phenom that is home-run king Jose Bautista of the Toronto Blue Jays, baseball is no longer a long-ball game. It’s about getting on base, progressing from first to second to third, and creating the conditions to get home. Maybe players score on a home run, but maybe they score on a wild pitch or a bunt.

The lesson is deceptively simple: small movement matters.

And the same is true of marketing: Get on base, progress, and create the conditions for the next step. Scoring in marketing is about how a consumer progresses through a relationship with a company or brand—the kind of relationship built on the customer’s researching a purchase, and so a planned, stage-driven relationship based on need. (And, no, despite the familiarity of social media, it’s not a friendship-type of relationship—it’s an informational and experiential one.)

Going Deep

Depth is the as-yet untapped promise of digital communications. Customer experiences can now be both real-time and practically bespoke, and they can be multilayered and asynchronous. Some relationships may not evolve for 10 years (think big appliances). Some will move fast. Some have fixed lifespans.

Consider a new mom: She will be a new mom for 24 months. After that, she’s got a different set of mom information and different experiential and product needs that could span years and dozens of interactions across multiple media in varying depth and complexity.

A customer-relationship lifecycle might have included one or two touch points in the 1970s (ads, in-store branding, and some PR), but there are now dozens. And those touch points can now be planned out with options: the choose-your-own-adventure approach to marketing, with measurement.

Accordingly, advertising is now rightly relegated to its proper place on the marketing spectrum: the outer edge. Advertising draws people in, but then what? How many people move from first base to second?

  • Some people will see an ad, start following a brand’s Twitter account, and then opt in to receive an email newsletter, which indicates a stronger tie and deepening progression in the relationship—welcome to second base!
  • The next steps: what kind of content they consume, and how quickly? Or download an app, set up an account, or join a community— they’ve made it to third!

Keeping Better Score

We’re starting to see words like “interaction planning” cropping up more in RFPs and programs. There is real potential for organizations and brands to build actual relationships of real utility with customers. And there is real potential to look at data on behavior to structure how those relationships can progress and to identify indicators of an increased likelihood to participate or buy—and then to measure results.

This isn’t about impressions—the RBI of the marketing world, a useless metric that doesn’t reflect anything other than a big impressive number for highlight reels and presentation decks. It’s about how relationships progress and evolve and what they reveal about the customer-relationship lifecycle.

We’ve learned over the past 10 years that digital relationships among consumers, buyers, and brands progress like other relationships. How they progress can be structured, benchmarked, and measured, telling us a great deal not only about consumer needs and interests, but also about how well current digital experiences truly deliver on those needs.

Oh, and one more thing: Go Jays!

Jen Evans is the Founder and Chief Strategist of Sequentia Environics.

Image credit: Rafael Amado Deras

Sequentia profiled in Gartner report on Digital Marketing Service Providers

The marketing landscape has changed significantly over the last two years, with new communication platforms and customer information needs.  Gartner has published its first report on the landscape of digital marketing service providers who help organizations go to market in this environment.

Sequentia Environics is honoured to be one of only twelve agencies profiled in this report.  We are cited for our experience in building online relationships, distilling our experience building over 100 online communities into a planned engagement model and proprietary marketing intelligence software.

The full report is available for purchase at www.gartner.com (ID Number: G00214389)

6 Key Insights For Building A Successful Community

How do you ensure your online community is a success? Online community programs take a lot of thought, planning and work to get them off the ground, but if done correctly can bring so much value for members and brands.

Community

While there is no silver bullet when it comes to ensuring the success of an online community, recent research on Digg and Reddit, two of the most prolific online communities, have highlighted the following elements as necessary for designing or managing a community that will thrive:

  • Optional anonymity. The ability for users to remain private helps shift the focus onto issues rather than individuals. Anonymity is also critical to help promote collective action within a community setting.

  • Democracy. The basic need for community is driven by a desire for collective action and a change in the balance of power.

  • Earned authority. While authority is tolerated in communities, it must be earned rather than appointed.

  • A strong sense of purpose. Every community needs a purpose or collective agenda, whether implicit or explicit. This purpose needs to go beyond products, services and tactical activities.

  • Transparency in operation and intent. The heart of an online community involves its relationship to a countercultural agenda. Transparency in operation forms a critical piece of that approach.

  • Inclusive ownership with scale. Every community should provide a mechanism for members to take ownership of certain areas of interest. This is especially important as a community begins to grow, as it allows for the development of collective identities.

To learn more, download the full research report (registration required).

 

Photo credit: Jack Louis Batchelor

reddit announces partnership with Sequentia Environics

July 21, 2011, TORONTO and NEW YORK – reddit and Sequentia Environics today announced a new partnership to develop branded communities for companies wanting to interact with reddit members for product feedback, market research and innovation.

“reddit members are known for being innovators and early adopters” said Erik Martin, General Manager of reddit. “We chose to partner with Sequentia Environics for their expertise in building and optimizing online communities, which companies can use to drive product innovation and market strategy through interactions with the reddit community.”

reddit’s partnership with Sequentia Environics delivers a turnkey community solution that brings together people who are highly influential and engaged online with companies and brands that are looking to innovate and deepen connections to their online audience.

“After building over 100 communities for companies across the globe, we’ve distilled the right strategy and support elements for successful community engagement,” explained Jen Evans, Founder and Chief Strategist of Sequentia Environics. “We are excited to partner with reddit to give their members opportunities to influence the leading companies in every industry, and give these companies a direct dialogue with the reddit community.”

Sequentia  recently conducted a digital ethnographic analysis of the cultural differences between reddit and Digg, discovering key elements central to a vibrant online community.  Download the research report (registration required).

About reddit

reddit (www.reddit.com) is the front page of the internet. With more than 1.2 billion page views and 18 million unique visitors each month, reddit users find, share, rate, and discuss content and opinion in real time from all over of the web. This passionate audience has grown to become the most influential community online and covers a huge variety of interests. reddit is part of Condé Nast.

About Sequentia Environics

Sequentia Environics (www.sequentiaenvironics.com) provides strategy and services to help companies generate better business results from their online initiatives. Using a combination of research, content, community and analytics, Sequentia helps its clients build sustained relationships that generate value for the company and its customers. Sequentia has developed digital communications strategies that generate revenue for a wide range of clients including Bell, The Globe and Mail, TAB Products Inc., Purina, and HP. Visit our website or follow us on Twitter.

 

Is TV easier to measure than social media?

I saw this Tweet today from Jay Baer which piqued my curiosity to read the full PR Week article where Kmart CMO Mark Snyder offered his perspective on measuring TV versus social.  Snyder is quoted as saying:

“social media is more about engagement, and it’s a little bit more difficult to
track the engagement point to the actual commerce.”

Mark is right that social media is about more than engagement.  We know that a lot happens before a person makes a purchase – everything from following someone on Twitter to subscribing to their newsletter.

To Jay’s point – is it really that people are not trying hard enough?  Should it even be hard to connect social activities to business results?  This is something we’ve thought long and hard about, and why we built our own social marketing measurement platform, Interpreter.  We believe the future of marketing lies in being able to measure the movements in an entire customer lifecycle.  More on this in future posts.

Sequentia Environics Announces Interpreter, a New Software Platform for Measuring Social Marketing Program Performance

Interpreter gives companies the ability to compare social media channels and content to measure return on investment and make smarter marketing decisions

July 18, 2011, TORONTO and SAN FRANCISCO – Sequentia Environics today announced the launch of Interpreter, new software that allows a company to measure, analyze, and compare the effectiveness of social media channels and content in deepening audience relationships and generating sales.

Companies including The Globe and Mail will use Interpreter to track and analyze:

  • How social channels and content impact acquisition, retention and ongoing customer relationships;
  • Conversion & engagement comparisons across Twitter, Facebook and LinkedIn, email campaigns and paid search;
  • Which combinations of content offers and channel promotions are driving key activities and business results among customers and prospects.

Using this data, companies can direct their marketing strategy, demonstrate ROI from their social media activities and make smarter use of their marketing budget.

“Social networks and community dynamics have fundamentally changed marketing to be much more complex, but at the same time much more measurable,” said Jen Evans, Founder and Chief Strategist at Sequentia Environics. “Interpreter came out of demand from our existing clients to connect their online activity to real business results – we measure what matters.”

Interpreter is an enterprise web-based SaaS platform and is available in three versions, based on usage and consulting support.  Sequentia is using Interpreter as part of its measurement framework for existing clients, with general availability scheduled for September 2011.

About Sequentia Environics

Sequentia Environics (www.sequentiaenvironics.com) provides strategy and services to help companies generate better business results from their online initiatives. Using a combination of research, content, community and analytics, Sequentia helps its clients build sustained relationships that generate value for the company and its customers. Sequentia has developed digital communications strategies that generate revenue for a wide range of clients including Bell, The Globe and Mail, TAB Products Inc., Purina, and HP. Visit our website or follow us on Twitter.

 

Measuring What Matters

The upside of working in marketing today is the availability of data – just about everything someone does on the web today is trackable and therefore, measurable.  In my recent years as a corporate marketer, I would produce weekly reports on everything from website visits to new pipeline opportunities – an exercise that took more time than I would have liked, but gave me something tangible to evaluate our performance.

The biggest challenge I had was filtering through what was important and how to relate the data back to my marketing strategy and marketing program mix.

It turns out I’m not alone.  Unica recently surveyed over 300 marketers and found that 57% of them were facing “analysis paralysis”, struggling to turn data into action.  And Augie Ray, Executive Director of Community and Collaboration at USAA, said it best in his recent blog post: “In the years to come, we will be awash in ever greater quantities of data and analysis, and it will be increasingly vital that we focus on what is truly important or else we’ll lose sight of what matters.”

We have a measurement framework and proprietary software at Sequentia that we use to help clients  make better decisions on their digital marketing initiatives.

5 key metrics to measure social and content marketing performance:

  • Content popularity: What content is generating the most interest? Where does interest convert to subscriptions, memberships or sales?
  • Customer digital paths: How many interactions does it take before someone subscribes to an email list or follows on Twitter? What content brought about the action?
  • Return on Investment: How is social media is contributing the sales funnel and to stronger digital relationships: are you creating a meaningful network of followers and fans? Or a lot of talk and not so much action?
  • Content performance: Compare content performance by asset & theme.  See how long your content really has legs – is it ten minutes? A week? A month? Years? Are there certain topics or themes that resonate more with your audience?
  • Channel performance comparison: if I put the same call to action on Twitter, Facebook and in the community, which performs best? What generates the most subscribers/conversions/community members?

What are you currently measuring in your role?  What measurement challenges do you face?  Let us know in the comments and stay tuned for future blog posts on measurement.

Image credit: aMichiganMom

4 tactics for engaging your brand’s biggest fans

Are you looking for ways to take better advantage of your brand advocates? The Social Media Examiner recently published a post entitled 9 Reasons Your Company Should Use Brand Advocates that described different attributes of brand advocates and provided suggestions for engaging with them. Based on their findings I’d like to share the following four tactics that Sequentia uses to wrangle and engage a client’s biggest fans:

Continue reading »

How starting your own charity can make you a more effective employee

Do you ever wonder about the best way to make a difference? What started as a backyard chat among a handful of university students trying to answer that same question evolved into a not-for-profit charitable foundation known as The Burgundy Brick Foundation. Since its creation in 2007, The Burgundy Brick Foundation has raised over $150,000 for Habitat for Humanity Toronto. We started with a simple goal of making a difference. But there was a catch. There were only four of us, all young women in their late teenage years working boring and temporary summer jobs. This meant we only had three months to accomplish our goal of before we had to go back to The University of Western Ontario. Continue reading »