The following is from the January 2009 Drilling Down Newsletter. Got a question about Customer Measurement, Management, Valuation, Retention, Loyalty, Defection? Just ask your question. Also, feel free to leave a comment.
Want to see the answers to previous questions? The pre-blog newsletter archives are here.
Q: The research folks in my company are trying to convince me that measuring sessions and Page Views per Session is more effective than using Recency and Sessions, as you advocate in your book, for a retention metric.
A: For a content site, the Page Views / Session measure can be used as a measure of visitor quality and appropriate marketing to the right audience – a customer acquisition idea – not retention. And it really needs to be broken out by Source – the average has little actionable meaning. You want to know the Visitor Sources, and then look at this metric by Source. This is still Frequency though – what about visitors who don’t come back?
Q: I am having some difficulty in making a decision regarding this. They want to give me a matrix with Page Views per Session on the Y axis and Total Sessions on the X axis as the “customer retention map”.
Continue reading Visitor Retention Mapping →
Riffing off a great post by George on marketing measurement, here’s a very specific example of how Marketers have to think differently when they are dealing with interactive environments, from my days at HSN.
We spent about 5 years and $100 million dollars trying to prove offline media would drive new customer acquisition and sales. We tried everything. Billboards. TV. Radio. Newspapers. TV Guides – local, national, and cable. Flyers, Shoppers, FSI’s. Spot cable. All of it, in just about every combination you can think of.
Each time we did these tests, we set up control markets and looked for Incremental sales in the media markets versus those with no media, based on revenue per household. We found incremental sales in just about every case.
The problem was this: even though the media created incremental sales, these sales were never enough to pay back the media on a net basis, meaning (roughly) (Gross Margin – Campaign Cost) – Variable Overhead was negative – even when you took into account the LifeTime Value of a new customer. Even when you looked at the test markets versus control 3 months, 6 months, and 12 months later, for those who might be thinking about “Brand” or “Awareness”.
If you’re thinking perhaps the campaigns were weak or light on exposure, I offer you this: when the campaigns included coupons, the redemptions were absolutely huge. That’s good, right?
Continue reading SEO for Cable TV →