Measuring marketing performance is fundamental to digital marketing analytics.
In fact, our ability to measure results accurately is a distinguishing feature of digital marketing.
That is, because we can capture more data, we are expected to deliver more data analysis typically through reports.
In Econsultancy's recent survey on analytics , respondents indicated that 'producing reports' was the most sought-after analytics skill in their organisation.
Some analysts, however, seem to do just that. They create large reports full of numbers, charts, and graphs.
These sorts of reports, however, are dissatisfying. They present all of the data, for sure, but they leave the reader to do the analysis.
In these cases, it seems that the analyst is just reporting, not analysing.
Instead, an analyst should edit the information they present and pay very close attention to what data is included:
Most of the data will stay with the analyst.
Some of the data will be shared with subject matter experts in the marketing department.
A small portion of the data will be sent upwards to management.
Then, with the space saved by removing all of the extra data, the analyst can provide insights and recommendations to enhance the report's value.
But what figures should go to which people?
Before we answer that...
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The boat metaphor
Knowing which figures to send to which people, however, is not necessarily obvious.
One way of determining which data to send is to think of your business as a boat on the open seas (H/T Advanced Performance Institute ).
Every boat has various gauges which report constantly changing numbers.
They tell you how fast the boat is going, the amount of fuel remaining, current water depth, and many other things.
It's not useful to record each and every number, but they are good to know in case there is a huge change.
In a business context, these numbers are metrics.
Some of the metrics tell you whether the boat is operating correctly and efficiently.
For example, the fuel gauge can tell you precisely about how much fuel you have left at any given time.
You won't watch that number constantly, but you really know if it falls beneath a particular level. These metrics are called performance indicators (PIs).
Certain PIs, such as present location, direction, and speed, indicate whether you are on course to arrive at your destination.
These PIs are different from other PIs as they are 'key' to everyone on the boat.
Other PIs may tell you that your ship is in tip-top shape, but if you're heading in the wrong direction it really doesn't matter to anyone else.
The metrics which are of interest to everyone on board, in a business setting, are called key performance indicators (KPIs).