leveraging data scientists and why content roi
Post on 28-Jan-2018
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@katrina_neal • #intelcontent
Leveraging Internal and External Data Scientists
and why its key to content ROI
Katrina Neal
Content Marketing Evangelist, LinkedIn
@katrina_neal
@katrina_neal • #intelcontent
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AGENDA
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How to talk ROI for [content] marketing
How to measure the value of your content marketing
How to leverage internal and external data scientists
The role of Content Marketing Platforms
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AGENDA
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How to talk ROI for marketing
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Return on Investment (ROI) is the benefit to an investor resulting from an investment of some resource.
In this formula, "Gain from Investment” refers to the proceeds obtained from the sale of the investment of interest
Return on Investment
Gain from investment – Cost of investment
Cost of investment
=
ROI
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For Return on Marketing Investment (ROMI) the two key metrics are incremental net profit generated from the activity (the financial return), Versus the cost of campaign (the investment). Measuring the incremental net profit requires deeper investigation.
Return on Marketing Investment
Incremental Net Profit
Cost of Campaign
=
ROMI
x 100%
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AGENDA
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To calculate ROMI you need
• Cost of Campaign
• Incremental Sales
• Retailer Margin
• Variable Cost per unit
• http://romi.ipa.co.uk/index.php/calculator
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Calculate the revenue you generated
Incremental sales units [A] = 18 coursesAverage price paid per unit [B] = £299Value of incremental retail sales [C] = A x B
Value of incremental retail sales [C] = £5,382
Step 1Return on Marketing Investment
ActualA Incremental sales volume (units) 18B Average price paid per unit £299C = A x B Value of incremental retail sales £5,382D Retailer gross margin (%) 0%E = D x C Retailer cash margin (£) £0F = C – E Incremental sales revenue to manufacturer £5,382G Variable cost per unit £102H = G x A Incremental variable costs £1,836I = F – H Contribution margin from incremental sales £3,546J = I ÷ F Contribution margin (%) 66%K Cost of campaign £300L = I – K Net profit generated by campaign £3,246M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
@katrina_neal • #intelcontent
Calculate the actual contribution you generated. To do this you must take into account the incremental COSTS incurred.
Variable cost per course (unit) was £102 = [G]Incremental sales units [A] = 18 coursesIncremental variable costs [H] = [G] x [A]
Incremental variable costs = £1,836
Incremental revenue [F] £5,382 Incremental Costs [H] £ £1,836Contribution Margin [I] = [F] – [H]
Contribution margin [I] = £3,546
Step 2Return on Marketing Investment
ActualA Incremental sales volume (units) 18B Average price paid per unit £299C = A x B Value of incremental retail sales £5,382D Retailer gross margin (%) 0%E = D x C Retailer cash margin (£) £0F = C – E Incremental sales revenue to manufacturer £5,382G Variable cost per unit £102H = G x A Incremental variable costs £1,836I = F – H Contribution margin from incremental sales £3,546J = I ÷ F Contribution margin (%) 66%K Cost of campaign £300L = I – K Net profit generated by campaign £3,246M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
@katrina_neal • #intelcontent
Subtract the cost of the campaign to calculate the actual profit it generated
Contribution margin [I] = £3,546Cost of Campaign [K] = £300
Net Profit Generated [L] = Contribution Margin [I] – Cost of Campaign [K]
Net Profit Generated [L] = £3,246
Step 3Return on Marketing Investment
ActualA Incremental sales volume (units) 18B Average price paid per unit £299C = A x B Value of incremental retail sales £5,382D Retailer gross margin (%) 0%E = D x C Retailer cash margin (£) £0F = C – E Incremental sales revenue to manufacturer £5,382G Variable cost per unit £102H = G x A Incremental variable costs £1,836I = F – H Contribution margin from incremental sales £3,546J = I ÷ F Contribution margin (%) 66%K Cost of campaign £300L = I – K Net profit generated by campaign £3,246M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
@katrina_neal • #intelcontent
The ROMI is presented as a percentage to show the ratio of profit from the investment
Return on Marketing Investment (ROMI) = L F
Net profit generated by campaign [L] £3,246Cost of Campaign [K] £300
ROMI = 1082%
Step 4 Return on Marketing Investment
ActualA Incremental sales volume (units) 18B Average price paid per unit £299C = A x B Value of incremental retail sales £5,382D Retailer gross margin (%) 0%E = D x C Retailer cash margin (£) £0F = C – E Incremental sales revenue to manufacturer £5,382G Variable cost per unit £102H = G x A Incremental variable costs £1,836I = F – H Contribution margin from incremental sales £3,546J = I ÷ F Contribution margin (%) 66%K Cost of campaign £300L = I – K Net profit generated by campaign £3,246M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
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AGENDA
@katrina_neal • #intelcontent
To Calculate ROMI you need
• Cost of Campaign
• Incremental Sales
• Retailer Margin
• Variable Cost per unit
• http://romi.ipa.co.uk/index.php/calculator
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AGENDA
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how to measure the value of your content
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Pipeline marketing is what you’re doing, while content marketing, inbound marketing, lead nurturing, and growth hacking are how you do it.
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Attribution Models
• Single Touch
• Multi touch
• Full Path
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Attribution Models
LinearTime decay
U-shaped W-shaped
Full pathCustom/
Algorithmic
First Touch
Last TouchLead
conversion touch
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B2B or B2C?How many channels do you use?
Do you have a sales team?How long is your sales cycle
Do you nurture opportunities?
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AGENDA
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Single Touch Attribution
• First Touch
• Lead Conversion touch
• Last Touch
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AGENDA
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Multi Touch Attribution• Linear
• Time decay
• U-shaped
• W-shaped
• Full path
• Custom
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Urchin Tracking Module (UTM) Parameters
utm_source=Google
utm_medium=CPC
utm_campaign=spring_sale
utm_content=logolink
utm_term=scuba+diving
Optional
Simply tags you add to a URL - supported out of the box by Google Analytics
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Linear multi-touch attribution model
Each touchpoint is assigned the same amount of revenue creditCalculate the percentage by dividing the whole value of 1 by the total number of touchpoints along your buying journey
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Time decay
If the sales cycle isn’t short, the early moments may not considered to be very importantmore concern is often given to nurturing initiatives
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U-shaped
The U-shaped multi-touch attribution model focuses on two key touchpoints 40% eachbut 20% of the revenue kudos is divided across the moments in the middle that occur between those two stages
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W-shaped
W-shaped multi-touch attribution modelling is similar to U-shaped, but it includes an additional key touchpoint
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Full path
The full-path marketing attribution model is one of the most sophisticated attribution models available.A full-path model also includes the post-opportunity stage marketing initiatives and it incorporates sales activities into the mix as well
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Custom
A custom multi-touch attribution model is built upon the basis of the full-path attribution model.
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AGENDA
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How to leverage data scientists
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“Today, as a data scientist, I can build data crunching machines with complex algorithms for a few dollars per hour”
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Found: The missing link between engagement and
revenue
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Q: What is the probability that an Engagement Activity would result in an SQL?
Q: Which activities would result in a Return Visit?
Content as seen through a Bayesian Network
Arcs: showing higher probabilistic relationships
Nodes: variables
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Project Bulletproof
Gaurav Nihalani Adam Yinger
Miguel Leano Alex Chen
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Guide vs. e-book?
We tested a Sponsored Update Headline with a Call To Action (CTA):
Download “Guide” vs Download “e-book”
“Guide” outperformed “e-book” 95% increase in Click Through Rate (CTR)
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Register vs. Join?
We tested a Sponsored Update Headline with a Call To Action (CTA):
“Register” vs “Join”
“Register” outperformed “Join” 165% increase in Click Through Rate (CTR)
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Quotes vs. Stats?
We tested a Sponsored Update Headline:
“Quote” vs “Stats”
“Quote” outperformed “Stat” 30% increase in Click Through Rate (CTR)
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Objects vs. People?
We tested a Sponsored Update Image:
“[Professional] Person” vs “Object”
“Person” outperformed “Object” 160% increase in Click Through Rate (CTR)
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Inmail vs. Inmail + Sponsored Content?
We did a multi channel test:
“Inmail” vs “Inmail + Sponsored Content”
“Inmail + Sponsored Content” outperformed “Inmail alone” 72% higher Click Through Rate (CTR)
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How you can run a simple A/B experiment on LinkedIn
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AGENDA
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Step 1• First, create a campaign that you want to promote.
Customize the creative, bidding, budget, etc. then
create an exact replica of that campaign as a second
campaign.
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AGENDA
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Step 2• Once you have two campaigns that are exactly alike
in every way, change one variable - for example, the targeting, the image or the headline text
• Run against the two different audiences for at least two weeks
• After two weeks, use an A/B significance test to monitor the results.
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Variation A:Control (the unaltered, original version)
Variation B: Treatment (the optimized version which you expect to perform better)
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splittestcalculator.com
This calculator is based on the two-sided Chi-Square statistic with Yates Correction.
This calculator uses a confidence level of 95%
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AGENDA
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Step 3• Make sure to also keep track of your A/B tests over
time. Finally, glean the results from all of your tests (or design a long-term experiment) to gain insights about your target audience and the success of your campaigns.
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Variation A:Control (the unaltered, original version)
+ 48%
Variation B: Treatment (the optimized version which you expect to perform better)
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Content Marketing Platforms
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@katrina_neal • #intelcontent
Q: What is the probability that an Engagement Activity would result in an SQL?
Q: Which activities would result in a Return Visit?
@katrina_neal • #intelcontent
Q: What is the probability that an Engagement Activity would result in an SQL?
Q: Which activities would result in a Return Visit?
@TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Understand commercial language
Champion the evolution of your content attribution models
Leverage data scientists and carry out your own experiments
Explore the potential of Content Marketing Platforms
TAKEAWAYS
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