Iterative Marketing Podcast Ep. 8: The 4 Elements of Effective Reporting

Iterative Marketing Podcast Ep. 8: The 4 Elements of Effective Reporting


Hello, Iterative Marketers!
Welcome to the Iterative Marketing Podcast, where each week, we give marketers and entrepreneurs
actionable ideas, techniques and examples to improve your marketing results. If you want notes and links to
the resources discussed on the show, sign up to get them emailed to you each week
at iterativemarketing.net. There, you’ll also find the Iterative Marketing blog
and our community LinkedIn group, where you can share ideas and ask questions
of your fellow Iterative Marketers. Now, let’s dive into the show! Hello everyone, and welcome! My name is Steve Robinson. I’m your host, and with me, as always, is the always-upbeat and always-super smart Elizabeth Earin. How are you doing today, Elizabeth? I am good, Steve. How are you? I am pretty good. I realized today that someone
asked me what I’m listening to, and I realized I’m listening to the same
stuff that I was listening to last year and the year before when it comes to music, and I was embarrassed to answer the question. So, yeah, what do you listen to? Oh, gosh! I am a huge country fan. So I typically have country music on
unless my husband is in the car, and then we have a shared
love for music from the ’90s and all those good ones when you
are growing up high school, kind of reminds you of that era. Which I guess I’m dating myself
now by saying high school in the ’90s. But yeah, so country or ’90s. And then when I’m alone and no one else can
complain about my music, I love Broadway musicals, obsessively love them, so not always the best person
to go on a road trip with. And other than country, you are a victim
to the same — listening the same stuff that I am. Not a victim! We are lucky to get to tie
that part of our life to that amazing music, so I think we are pretty lucky. What are we talking about today? Today, we are talking about reporting. Okay. And more specifically, reporting on the
results of our marketing efforts, right? Definitely, and this is something that I am –
a topic I’m pretty passionate about. I have written a blog or two about it already, but it’s something, as a marketer,
we struggle with. And having worked in corporate marketing
and marketing for a startup, it’s something that no matter
what industry you seem to be in, it seems to be the same
problem across the board. And how do you report on the value
that you are adding to the organization? Yeah. And so many of us fall on the traps of,
well I am not sure what I want to report on, so we are just going to throw a bunch of
vanity metrics at this and get that out the door, when that’s really selling ourselves
and our team’s effort short. It’s far better if you can really prove that value up
the org chart, because it gives you a lot of things. It helps, like you said, moving up the org chart
and showing the value to the organization, but I think it also helps to show –
prove the value to ourselves. And I think, as marketers, we have got a gut feeling
that what we are doing is working or not working. It feels right or it feels off. We get that feedback from customer surveys
and from our executive team, but we don’t have any specific metrics that really say,
yes, this is working the way it wants to. Or at least a lot of us don’t have that, and if you don’t, you are not alone. There was a really awesome
study done in 2011 and they found that 69% of marketers
that they surveyed felt that their strategies and campaigns were impacting the
company’s business, but they had no way to prove it. We didn’t know how to show that they were, that they – what contribution they were actually making. And so 69%, this is not something
that only one of us is experiencing. This is a widespread problem, and so I think that’s why it’s a really
great topic that we are covering today. Yeah. I think it’s also important that we cover it, because we have talked a couple times
earlier about the expectations that we set, and if you don’t follow through
and report on those expectations, specifically expectations around
continuous improvement and why we start small
and other things like that, then you really aren’t following
through on your promise. And part of the goal of Iterative Marketing, as a practice, is to really establish that credibility of
marketing, as a force, within the organization. And it’s our ability to demonstrate that we are either meeting
or exceeding the objectives that have been set for us. And we would be remiss if we didn’t also mention
that if you do a really good job of reporting, then usually you are rewarded with
more budget and more resources. And budget and resources means
that you can do a lot more. And so we all struggle when it comes to
budget season and getting those resources. By effectively reporting, you set
yourself up for success there. That definitely makes the
conversation a lot easier. So what do we report when we go into this
reporting, because vanity metrics don’t cut it. But if you are not going to report on the number of likes we have on Facebook, what are we going to talk about? I think there’s four separate
areas we want to report on. And the first one is the ever-elusive ROI. And really, what we are looking for here is, is to get as close to tying our direct
investment back to revenue as we can. Yeah, and that’s projected revenue, right? Yes. And then the second thing is, not all
of our activities are really tied to revenues. Some of them are setting
ourselves up for future success, and so we also want to report
on the assets that we build, the things that we’re banking, that we’re going to be able to draw from in the future, right? And this is important because it
sets us up for that future success. Yes, we are tasked with performance now, but we also need to make sure that the company
is poised to be successful in the future, as well. And then, it wouldn’t be Iterative Marketing
if we weren’t iterating and improving. And so, we are making things better. We want to show folks that
we are making things better, so we want to report on the
improvements that we are making. And then the fourth component, the fourth thing
that we really want to talk about in our reports is the insights that we are generating, because if we are doing a good job of setting up
experiments like we talked about in past episodes, we are not just improving the results, but we are also
generating insights that can be applied elsewhere. Elsewhere, like the personas
and customer journeys. Absolutely, absolutely. So, I think we should
take these four topics – ROI, Assets, Improvements and Insights, and talk about them individually. We will take them in order and start with ROI. That’s great, and I think
it’s a good place to start, because again, this is one of the leading
concerns of our frustrations of marketers. In fact, when you look at
industry surveys and data, it appears to continuously be in the top
two or top three concerns of showing ROI or proving ROI to the executive team or C-suite. And I think it’s important to ask
why is it such a frustration? Why are we having such a hard time
or why is it bothering us? And I think the answer is
because it’s hard to do. And when we start to look at why it’s
so hard to do, two kinds of themes come out. And the first is that not every marketing activity can be attributed to a specific purchase or a new client. Absolutely, and the other problem is
that it’s a matter of timing, right? Because if you engage in some
marketing activity today, it could be a week, it could be a month, it could
be six months, a year, two years in the future before you actually reap the benefit. We have done some work with clients
who serve the aerospace industry, and it’s notorious for crazy long
buying cycles of twelve to eighteen months. And so if you think about it, if you are a manufacturer servicing that industry,
you are launching a new product, all of the marketing goes out for that new product
before the first widget hits the production floor, right? So you have your marketing, you have your
sales cycle, which is that crazy long twelve to eighteen months, now you have to produce the product. You produce the product, you ship it,
you get it out the door, you invoice for it, then you have to wait to
get paid on those invoices. All that happens before a single dollar hits – comes back from the marketing effort that you
put in the beginning of that product launch. So, you can’t just rely on that trailing indicator of revenue
to get to whether or not what you are doing is working. Well, you just outlined sort of a process, a lengthy process. So not only do you have the timeline issue,
but you mentioned marketing activities. There’s more than one thing that has been done over
this six-month or twelve-month or eighteen-month period, and so it also becomes an issue of attribution and which of our marketing activities contributed
to the sale and what was their impact on that, what percentage, what extent
did each activity contribute. And so trying to take that back to revenue
presents an entirely different problem. Yeah. And so how do we get around this? What’s the solution if we can’t just take the dollars
that are coming in and immediately lay claim? That was marketing; we did that, yay! Yeah, I think that’s a great question, and there’s two ways that we can look at this. There are sort of two indicators in terms
of what it is that we have contributed and there’s leading versus trailing. Trailing is kind of this obvious one
that we’re talking about. It’s the revenue,
it’s the return on investment, but as we have just finished discussing,
that’s complicated. There’s a number of issues why this isn’t just a
straightforward thing that we are able to report on. And so when you are in that situation,
you have got a long lead time, you have got a lot of different marketing
activities in your sales process. What’s another way that we can try
and figure out what it is that we are contributing and how our programs are
impacting the company’s performance? Yeah. That’s really where you want
to look at leading indicators. So, these are the metrics you can measure
that indicate future success in revenue and then determine what that correlation is. So examples of leading indicators,
or KPIs as we commonly call them, are things like the number of
appointments that you have booked, the number of leads that you have gotten in
free trials for software or demonstrations or downloads. There are specific actions that occur earlier in
the sales cycle, earlier in that customer journey, that you know that if you get X number of these in,
you are going to get Y number of dollars out. And I think it’s important to talk about the
fact that, on their own, they don’t necessarily — you can’t just take them on their own,
you have to put them into a little bit of context and understand what their
relationship is to future revenue. And so, if you say you have fifteen free trial requests,
what does that translate to six months down the road? Right. And in order to do that, you have to be able
to understand what that relationship is. If you have a good KPI, it’s directly proportional. You increase the number of free trial requests
you increase the amount of money coming out, but you have to know the math behind that. And so, to do that, you have to analyze everything
going backwards for a period of time and understand exactly what that relationship is. And that can be hard, but in most companies, it’s doable if you have a leading indicator to be able to
track that back in a direct relationship to revenue. And I think this is, like you said, it can be hard, but Heather Ohlman wrote a fabulous blog post on this
in the relationship between KPIs and revenue, and I believe we will link to this in the show notes and I definitely recommend checking that out. Great. Well, I think this is a great time for us to break
and talk about how we can go help some people. When we get back, we will hit on
the other three areas of reporting. Before we continue, I’d like to take a quick moment
to ask you Iterative Marketers a small but meaningful favor and give a few dollars to a charity
that’s important to one of our own. This week’s charitable cause was
submitted by Bostik Industrial, who asks that you make
a donation to United Way and help support nearly 800 communities across
more than 40 countries and territories worldwide to create community solutions that improve
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or visit the link in the show notes. If you would like to submit your cause
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and click the “Share a Cause” button. We want to support
what’s important to you. And we’re back! So, before the break, we talked about one of
the four key areas for reporting return on investment, really tying your marketing activity
directly back to dollars. But there’s three more that
we want to talk about. The second one is actually a great contrast to
that ROI that we were talking about earlier, because not every dollar you invest is going to
immediately come back in return of additional revenue. Sometimes, you are investing in future
success for the marketing organization. And I think this is important here because,
again, we mentioned this earlier in the podcast but we are tasked with producing
results and we need to do that now, but we also need to set the
company up for success, and that is what these
long-term assets are doing. Exactly. It’s kind of like if you were to – A great analogy is a factory. If you own a factory, you spend
money on raw materials, and the amount of money that you spend on
raw materials is pretty much directly proportional to the amount of stuff that
your factory produces. You buy more materials,
you produce more stuff, but that’s not the only investment
that you make in your factory. You also buy machinery, and if you make an investment in your machinery, that money out isn’t going to immediately
come back as more stuff out. It’s an investment in more efficient
production of stuff in the future. And in marketing, our raw materials are the
ads that we are producing, the content we are producing and then the spend that gets
it out there to distribute it. We produce more content,
we spend more money to get it out there, that should have a direct
correlation on revenue, but the investments that we make that are
going to be a little bit more long-term investments include things like our machinery, include things like the
database that we build up of known prospects, the cookie pools that we build up if we
are doing a lot of first-party targeting of how we can better-target
our ads in the future. Our brand, the goodwill of our brand,
is something that we build up over time, and making huge investments in the goodwill of
our brand is not going to equate to immediate sales. I love this example, because I think it really helps to put into context what it is we are talking about, that not all of our marketing
activities are necessarily expenses. Some of these are long-term investments, and they are vital to the success of our company
and our business and our future sales. And so, I love that you have been able to
tie this back to kind of that factory example. And really, it comes back
to reporting on the assets. We are able to demonstrate our progress
in developing these long-term investments that, like you said earlier, may
not be producing results today, but again, are setting us
up for future success. And I think you wrote a great blog post about this,
and I think the show notes will provide a link, but it’s another read. Apparently we are reciting a lot of
extra reading in this podcast. Yeah. And a lot of marketers have a
tendency to not report on this. We are all making these investments, but by not reporting on it, you are missing
a key component where the budget’s going. And if those making budget decisions or having
the opportunity to impact your budget decisions don’t understand where the money
is going, then that can hurt you in the future. So it’s important to prove that you
are setting yourself up for future success and that, hey, this is where we are investing, right? This is where some of
this money is going. I think a third area that we can report on, and I think a lot of times, as marketers, we have
a tendency to overlook are improvements. And we talked about optimizations
a couple of weeks ago and we talked about setting expectations with the
C-suite of starting small and continuously improving, and it’s important to report
on those improvements because it shows that we are
adding value to the organization. And it’s not just showing that we are adding value,
we are actually adding value to the organization. Yeah, absolutely. There’s a couple of different types of ways – there’s a couple of different ways we can
show that we are making improvements. One is to simply document the
improvements that we are making. So what optimizations did we make based on
the data that we got from our experiments? That’s valuable in and of itself, but then also making sure that, as we are
reporting on the numbers, on the ROI, on the metrics, that we are showing
the changes in those over time, because if you let a metric stand on its
own, it doesn’t really mean a whole lot. I think that’s a great point. You have got to have
something to compare it to. If I tell you that I produced
100 leads at $50 a lead, is that good?
Is that bad? You really don’t have
anything to compare it to, but if I tell you that the month before,
that we had produced 90 leads at $75 a lead, well, now I have shown that there
has been an improvement. And so even without a direct connection
to revenue, this is still a good thing. And it shows that I am
moving in the right direction and I am not just standing still with my
marketing efforts and my marketing spend. Speaking of not standing still,
the fourth component is not only the improvements you make,
but the insights that you generate along the way. And we talked about this in
the Optimizations podcast. We harped on it again in the Experiments, but if you are producing
quality thoughtful experiments, those experiments don’t just tell you
what color your buttons should be. They tell you more about the
personas that you are targeting and the journeys that those personas
are following along the buying process. This is one of my favorite parts. I feel like I say that a lot though,
so I don’t know if I can be held accountable to it, but I love insights, because this is
kind of our secret weapon as marketers. We want to get inside the heads of our target
audience, and insights is our ability to do that. And so kind of taking a look at the
designing thoughtful experiments and how that can be applied
across the entire organization. I think — let’s give an example. And if you are looking at a lawn care company
and you have developed – identified two personas, you have got an elderly gentleman named Earl
and an affluent guy named Andy, and we are running some tests to try and figure out
what sort of messaging resonates best with them. Well, we run an experiment and we
find out that being on time — we run an ad and that focuses
on timeliness and being on time and we find that it really
resonates with Earl. This is the ad that he has clicked on
over and over and over again. This is the one he is responding to. Well, not only have we now figured out what is
our most effective form of advertising for banner ads, which can then be applied
over to traditional advertising, but we have also figured out that this
is something that Earl really values. I have renamed him already,
but he really values. Well, now this is something that we can help
to put in as part of our company culture and this is part of our service promise
that we are making to our customers, and so it’s something that, not only are we
advertising, but then we are following through, and so we are maintaining consistency
across the brand and that’s really important. Yeah. And if you take the time
to report these insights up, they have an opportunity to then get transferred over
to other parts of the company, whether it’s the sales team so the sales team knows what
promises they should make, whether that’s R&D so they know what kind of
products or services need to be developed next. Customer service, what’s really
important to these people. These insights are applicable
in multiple different places, and going with our theme of
linking in the show notes here, I know Heather wrote a great post on iterativemarketing.net on how to really get these insights out of your experiments, and we will link to that in the show notes as well. So those are sort of the
four ways that we can report, but I think we know, before to kind of wrap this up,
there’s one other thing we want to talk about and that comes down to regular reporting
inconsistency and that’s really key. By regularly demonstrating that we are
producing more with the same investment, we are going to get access to those larger budgets
that we talked about earlier when we first started the podcast, and we are going to have more opportunities to promote marketing as a driving force within the organization, which ultimately increases
our value to the C-suite and the Powers-That-Be and the ones that
are making decisions about our future, and so it’s really exciting, but the
key is that it has to be regular. If you want to learn more about
these four different areas of reporting – ROI, Assets, Improvements and Insights — Elizabeth, my co-host here, wrote a great post
on iterativemarketing.net that we will link to, and you can read through this again and apply
it in the next time that you produce a report. I should note that this pretty much rounds out
our podcast on the six actionable components. So in Episodes 2 through 8, we covered brand,
we covered defining your brand, your persona discovery, journey mapping, aligning your content and your
channels with your journeys and your personas. We talked about experiment and optimization, and then this week being the last one,
we talked about reporting and feedback. So next week, we are going to talk
about something a little bit different. And because we know all
of you marketers out there, you are not sitting still just waiting for
the day to apply Iterative Marketing. You have got a lot going on right now, so we are going to circle back and say
how do you start applying the stuff today in a marketing organization that
already has a bunch of moving parts, where you already have goals and
objectives that you are trying to attack. We are going to bring it back down to
some things you can start doing today. So with that, until next week,
hope to see you soon. Thanks. If you haven’t already, be sure to subscribe to the
podcast on YouTube, on your favorite podcast directory. If you want notes and links
to resources discussed on the show, sign up to get them emailed to you
each week at iterativemarketing.net. There, you’ll also find the Iterative Marketing blog
and our community LinkedIn group, where you can share ideas and ask
questions of your fellow Iterative Marketers. You can also follow us on Twitter. Our username is @iter8ive or email us
at [email protected] The Iterative Marketing Podcast is
a production of Brilliant Metrics, a consultancy helping brands and agencies
rid the world of marketing waste. Our producer is Heather Ohlman
with transcription assistance from Emily Bechtel. Our music is by SeaStock Audio,
Music Production and Sound Design. You can check them out
at seastockaudio.com. We will see you next week. Until then, onward and upward!

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