There's no end to the data you can collect. There's no end to the tests you can run. There's no end to the analysis you can toy with.
Can we increase click-throughs?
Can we increase product comparisons?
Can we increase sales?
Can we increase customer satisfaction?
Which should we do first?
How do you prioritize optimization?
It hardly seems worthwhile to engage in, say, an A/B split test if you can only realize a half a percent improvement in conversion.
But if you are Walmart with projected online sales this year of $9 billion, that would make your measly 0.5 percent improvement worth $450 million. Not bad for a day's work.
On the other hand, you don't want to waste your time on a mere half a percent when you could shoot for 5 percent or 10 percent or better. So, how do you prioritize optimization?
A. Identify Projects Projected to Yield the Most Improvement
Don't get distracted by the ROI on the knowledge management. Yes, some of these projects may generate insights that have a direct impact on other projects, but just stay focused on changes you can make that lead to immediate revenues.
How much impact do you think you can have on...
B. Winnow the Least Likely to Succeed
C. Assess the Sales Cycle Impact
Does your client base react like robots to your advertising? If so, you're in luck. Put more money in and more money comes out. Solid ROI.
But for most of us, doubling advertising spend does not directly double sales. So the value of this project must be weighted much lower than doubling the value of the shopping cart. That will definitely translate to double the revenue and deserves to be positively weighted.
D. Better, Faster, Cheaper
Now that you have a working hypothesis for which projects will yield the best return and which are most likely to actually be implemented, the final step is to determine which will be the least expensive and the fastest to achieve. An expensive project that won't bear fruit for many years is not your friend.
Stay Focused, My Friend
The most important thing to remember about digital marketing optimization and analytics is to limit what you try to accomplish. There's no end to the data you can collect. There's no end to the tests you can run. There's no end to the analysis you can toy with.
Stay focused on the big wins and the two or three metrics that are worth moving the needle.
Image on home page via Shutterstock.
Editor's Note: As 2013 draws to a close, we will be featuring the top expert columns of the year. Enjoy this column from Jim Sterne, originally published August 15, 2013.
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Jim Sterne is an international consultant who focuses on measuring the value of the Web as a medium for creating and strengthening customer relationships. Sterne has written eight books on using the Internet for marketing, is the founding president and current chairman of the Digital Analytics Association and produces the eMetrics Summit and the Media Analytics Summit.
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IBM Social Analytics: The Science Behind Social Media Marketing
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An Introduction to Marketing Attribution: Selecting the Right Model for Search, Display & Social Advertising
If you're considering implementing a marketing attribution model to measure and optimize your programs, this paper is a great introduction. It also includes real-life tips from marketers who have successfully implemented attribution in their organizations.
October 23, 2014
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