Testing and Measuring Your Marketing Efforts
James Black shares an article on structuring tests to learn from marketing performance.
As your marketing shifts from planning to execution, it’s important to structure tests to understand how well your marketing is performing, and to learn from it. While the old adage “Half of my marketing isn’t working, I just don‘t know which half” often rings true, today you have access to more and better data to track the performance of your marketing and ideally the return on your marketing investment. The important thing to do is to design tests, set success criteria to measure and collect learnings to inform future marketing initiatives. By borrowing key elements of the marketing process from leading consumer marketing companies, you can make your marketing work harder for you. Also, because as a start-up you are likely to be more nimble, this enables you to quickly invest in higher return marketing, vs. spending too much in vehicles that aren’t productive, which is a considerable advantage in the marketplace.
Set up “test and learns.” In reality, everything you do as a start-up is a “test and learn.” The important thing, though, is to put some structure around the work to understand what resourcing you should commit to it and, ideally, what you are getting out of it. After all, most start-ups are not “idea-constrained”, they are “dollar-constrained” or “resource-constrained.” As such, you have to ultimately make choices about whether to invest a dollar or an hour here or there, you generally don’t have the luxury of doing “everything” and if you do, few have the luxury of doing everything well! For each marketing tactic you deploy, outline a simple test and learn strategy. Note the: a) objective for using the tactic, b) what specific things you are looking to test, c) how you are going to measure success and d) benchmarks for what you anticipate performance to look like. For example, if you are using Google AdWords, the objective would be “to drive traffic to our website,” the testing might focus on different advertising directions and keywords, and the success measures could include a) website traffic, b) cost per click and c) sales generated via AdWords. Likewise a request for sampling program might have an objective of trial and compare the results of redemption rates from various request executions. In addition to applying this logic to core tactics, it’s important to identify one or two tests to execute that have the potential for breakthrough to push your marketing and marketing learning forward. For decades people have cited the 3M “15 percent” rule (where employees allocate 15 percent of their time to self-managed innovation projects); think about a similar logic, it terms of budget or hours that you want to put against marketing innovation in your plans. You want to make sure that core tactics are sufficiently funded, but it’s important to also have a “test and learn” budget for marketing innovation so that your marketing plan is not merely “tried and true” and that you’re also making reasonable investments to prove out “unknowns.
Key points include:
- Tracking learnings
- Setting success criteria
- Test and learns
Access the full article, Think Big, Act Small #4. Learning Early, Inexpensively and Correctly: the Role of Testing & Measuring in Marketing, on LinkedIn.