Today, 70% of the marketing spend, which is 700 billion dollars, is digital, and any campaign done digitally generates a huge amount of data.
Traditionally, marketing used to be a struggle. To create a business impact, and to measure the impact on business was challenging as there was hardly any data during the days of newspapers and television.
As you know, every second on the internet, we generate 328.77 million terabytes of data, so analytics is becoming a core part of digital marketing.
Half the money I spend on advertising is wasted; the trouble is I don't know which half.
But from having no data or very little data, we have moved to the other extreme, where there is a huge amount of data available.
Now, this has created another problem: understanding what the real impact is.
Even at a smaller level, people might say, “Even if I have to analyse how much impact my social media post has had, I could say my followers have grown, my likes have grown, my comments have increased, or there is a high impression.”
So, which is the right metric to see to know the real impact on business? And today, marketers have to do a lot of things together to figure this out. This is where marketing analytics come into play!
Also Read: Decoding Analytics in the D2C and Omni-Channel World
Marketing analytics enables us to gain a detailed understanding of how each individual component performs. It then allows us to see how these elements work together holistically, helping us assess the overall impact on the business.
It answers key questions like:
- What is the performance of our marketing efforts?
- How do our marketing activities stack up against our competitors?
- Are we using our marketing resources wisely?
- Are we investing time and money in the right channels?
- How should we prioritise our spending over time?
So, how can you build a strong marketing analytics practice at your business? Read this blog to learn how good marketing analytics can help your business, what are the common common challenges, how to solve them and the key components of analytics you need to know.
Table of Contents
1. What is Marketing Analytics?
“Marketing analytics doesn’t just tell you what’s happening; it helps you understand why.”
By analysing customer data throughout the omnichannel customer journey (awareness, interest, consideration, decision, retention), you can identify where you’re losing potential customers and optimise your marketing efforts to improve conversion rates and customer lifetime value (CLV).
2. Why Do You Need Marketing Analytics?
Marketing analytics is essential for businesses of all sizes and forms to help them understand where they can allocate their omnichannel marketing efforts and resources. Only having an idea is not enough if you cannot track its performance when put into action.
With consumers becoming more and more selective today about engaging with brands, marketing analytics can help you analyse your effectiveness in running marketing campaigns, social media channels, paid ads, website pages and performance CTAs.
- Increasing Revenue — Analytics help understand how to optimise your website for maximum conversion, how customers behave, and enhance the overall value of your service or product offerings.
- Reducing Cost — You can find out the operational efficiencies and boost them in your campaign delivery to decrease costs without compromising on results.
- Boost Customer Satisfaction — With proper analytics, you can discover what your customers are looking for and offer an enhanced experience across every touchpoint ranging from brand awareness to product purchase.
- Gaining Customer Retention — With the right tools and strategies, you gain data about customer retention rate and churn. It allows you to identify the issues in customer satisfaction and take appropriate measures, hence reducing customer attrition in future.
3. What Issues Are Common in Marketing Analytics?
Maintaining and building marketing analytics does not come easy. There are some challenges involved, which, of course, you can overcome. Here are some major barriers that you may come across:
- Marketers have large amounts of data: Omnichannel Marketers come across a large amount of data from various channels – web, mobile, email, social media, and streaming. With the rise of new platforms and the growth of email and streaming, this data comes in diverse formats and patterns, making it challenging to collect, compare, and turn into actionable insights.
- Data is scattered and not connected: Most marketers know they need a complete view of all their marketing channels, but 71% still look at data in separate pieces rather than as a whole. This disconnected approach makes it hard to see how well strategies are working and can lead to poor decisions and lost earnings. Integrating data is tough because it often involves different departments, teams, and technologies, creating many challenges.
- Trouble converting insights into action: Collecting data is just the start; the key is interpreting it and making informed decisions. With tight deadlines and urgent tasks, analysis can be overlooked. Ensuring that insights are delivered and accessible when needed is crucial for making data truly impactful.
- The marketing landscape is ever changing: The omnichannel marketing ecosystem is rapidly evolving with changing privacy laws and this shift means marketers will lose access to detailed tracking data. It will force them to adapt their strategies. Many marketers are focusing more on first-party data from their own channels and investing in new technologies to manage and measure performance effectively.
4. Three Ways Marketing Analytics Benefit You
- Access to Detailed Customer Overview: Marketing analytics can help you understand everything about your consumer choices and preferences. Rather than simply doing wild guesses, you can gain insights to the evidence of how your customers are engaging with your brand. It provides a complete overview of your customers, hence understanding their journey. You can, thereby, create customised experiences and increase growth and conversion rates.
- Proves The Real Impact of Marketing: Marketing analytics help you understand your efforts and show you the actual results of your efforts like customer retention and boost in sales. This is a crucial proof that helps justify your marketing investments & help secure further fundings in the future.
- Timely Insights On Marketing Optimization: You can assess the performance of your marketing campaigns in real time with marketing analytics. You can do A/B testing and refine your strategies based on the data you get. It also helps you make better decisions, increase revenue and make immediate improvements.
5. Key Components of Marketing Analytics
Before diving into the details, it’s important to understand the key components that make up marketing analytics.
These are the essential building blocks that help businesses track, measure, and improve their marketing strategies for better results.
5.1. Digital Analytics
5.2. Campaign Analytics
5.3. Marketing Attribution
5.4. Customer Analytics
5.5. Social Media Analytics
5.6. Brand Tracking
5.1. Digital Analytics
Digital analytics helps businesses understand how people interact with online content. It involves collecting, measuring, analyzing, visualizing, and interpreting digital data to gain insights into user behavior. With digital analytics, businesses can see how customers respond to ads, social media, and websites. This helps them improve the customer experience and boost business performance.
It helps answer important questions like:
- How much traffic is my site getting?
- What is my conversion rate?
- Which marketing channels bring the most engagement?
- Where are users dropping off in their journey?
Key Performance Indicators (KPIs) to Track:
- Website Traffic
- Conversion Rate
- Engagement rate
- Click rate
- Return on investment (ROI)
- Customer acquisition cost (CAC)
- Bounce Rate
- Cost per click (CPC)
- Average Session Duration
- Pages per Session
- Cost per click (CPC)
- Cost Per Acquisition (CPA)
5.2. Campaign Analytics
Campaign analytics involves collecting, analyzing, and measuring data from marketing campaigns to understand their effectiveness and performance. This data, gathered from sources like email, social media, and paid ads, helps marketers make data-driven decisions to boost return on investment (ROI).
It addresses important questions like:
- What metrics determine our campaign’s success?
- How do we monitor customer engagement?
- Which strategies deliver the best outcomes?
- How can we keep improving our campaigns?
Key Performance Indicators (KPIs) to Track:
- Return on Ad Spend (ROAS)
- Conversion Rate
- Click-Through Rate (CTR)
- Conversion rate optimization
- Cost Per Conversion
- Return on Investment (ROI)
5.3. Marketing Attribution
Marketing attribution is the process of determining how different marketing tactics and customer interactions contribute to achieving sales, conversions, or other business goals.
By analyzing these metrics, marketers can identify which channels and messages are most effective in encouraging potential buyers to take action. Here are it’s following Types:
Single-Touch Attribution:
- First-Touch Attribution: Gives full credit to the first interaction that brought the customer into the funnel.
- Last-Click Attribution: Gives full credit to the last interaction before the customer converts.
Multi-Touch Attribution:
- Linear Attribution: Splits credit equally across all touchpoints.
- Time Decay Attribution: Gives more credit to the most recent touchpoints.
- U-Shaped Attribution: Splits credit between the first touch and the lead conversion touchpoint, with some credit to other touchpoints.
- W-Shaped Attribution: Splits credit between the first touch, lead creation, and the final conversion point, with some credit to other touchpoints.
Let’s consider a customer who watches an ad and interacts with different channels before making a purchase. Which channel influences customers to make a purchase?
Marketing attribution helps answer these critical questions:
- How do we determine the effectiveness of our campaigns?
- Which channels contribute most to conversions?
- What touchpoints drive customer decisions?
- How can we optimize our omnichannel marketing spend?
Key Performance Indicators (KPIs) to Track:
- Return on Ad Spend (ROAS)
- Conversion Rate
- Click-Through Rate (CTR)
- Cost Per Conversion
- Return on Investment (ROI)
5.4. Customer Analytics
In today’s competitive world, knowing your customers isn’t just important—it’s essential. By leveraging data to gain insights into these questions, customer analytics provides the information needed to refine strategies, increase engagement, and maximize profitability.
Customer analytics helps answer key questions like:
- Where did we acquire this customer?
- What influences customer behavior?
- How do we evaluate customer value?
- How can we improve the customer experience?
Key Performance Indicators (KPIs) to Track:
- Customer Lifetime Value (LTV)
- Customer Acquisition Cost (CAC)
- Churn Rate
- Average Order Value (AOV)
- Net Promoter Score (NPS)
- Customer Satisfaction Rate (CSAT)
The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.
5.5. Social Media Analytics
Social media isn’t just for connecting—it’s a vital business tool. Knowing how your brand performs on social media is crucial for staying ahead. It involves tracking metrics like likes, shares, and followers, and then using that data to gain insights that can help refine omnichannel marketing strategies and achieve goals.
Social Media Analytics helps answer important questions like:
- What content connects best with our audience?
- Which platforms generate the most engagement?
- How does our social media strategy support our overall business goals?
- How can we improve our social media presence for better results?
Key Performance Indicators (KPIs) to Track:
- Impressions
- Click-Through Rate (CTR)
- Engagement Rate
- Cost per Click
5.6. Brand Tracking
Keeping a close watch on your brand’s position is essential in the world where brand value is the most important element in business. Brand tracking is the continuous measurement of a brand’s performance based on key metrics like brand awareness, perception, and consideration.
Its goal is to help brand owners assess their brand’s health, make informed decisions to boost sales, improve marketing ROI, and gain market share.
Brand Tracking helps answer important questions like:
- How do consumers view our brand?
- How does our brand’s voice compare to competitors?
- Are our omnichannel marketing efforts boosting brand awareness and loyalty?
- What factors are driving changes in brand perception?
Key Performance Indicators (KPIs) to Track:
- Brand Awareness
- Brand Perception
- Brand Image
- Brand Recall
- Net Promoter Score (NPS)
- Customer Loyalty
6. Conclusion
Marketing analytics isn’t just about crunching numbers—it’s the guide that helps your strategies succeed.
It’s important for businesses to understand how customers behave, improve their strategies, and grow. Using insights from data, companies can keep customers coming back, get better returns on their investments, and stay ahead of the competition.
Hope this blog gives you a detailed idea on Marketing Analytics and its key components that you can similarly apply and integrate in your marketing strategy as well.
If you want to establish marketing analytics as a practice, feel free to consult with us at alibha@daiom.in
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