The multi-metric approach and cookie blockages

LinkedIn newsletter July 2023

This newsletter aims to shed light on the challenges created by cookie blockage and overvalued ad platforms while emphasizing the importance of adopting a multi-metric approach to marketing analytics. If you want a quick rundown (TL;DR) of the article scroll all the way down. This will give you the gist of the article in less then a minute. :)

Battling cookie blockage and ad platform overvaluation

Ad platforms often take credit for conversions, even though other platforms might have had a bigger part in getting that conversion. Combine this with a last-click attribution model and marketeers will end up with conflicting reports and channels that don't get the credit they deserve.

Add in the short-term memory of digital "cookies" and things will start to get even more confusing. Since cookies don't stick around for long and can't track across different devices or browsers, we can't always trust the data they provide.

There are ways to fix this or at least give you a better understanding of what is really going on. For example:

1. Cookieless tracking: By collecting various device-specific information, AI tracking models can link sessions of the same user on different ad platforms without collecting personal data (since we anonymise this data). Because these models can't be blocked, it provides you with much better insights of your customer behavior.
2. Hybrid attribution models: This is a fairer way of giving credit to all your marketing efforts. Instead of just looking at the last click before a purchase, it considers the whole journey. So, if someone saw your ad on social media, clicked an email, and then made a purchase; each step gets some of the credit.
3. Cross-platform reporting:?This is like a meeting where all your marketing channels share notes about a customer's activity. So, whether a customer saw your ad on Facebook, searched your product on Google, or read your email, all these pieces of information get pooled together in one platform.

There are many tools out there using these three techniques, but very few implement them all. Some tools focus on cross-platform reporting , while others focus on conversion modeling.

Finding the right fit for you should really be based on your company's needs. For example, if you solely need accurate metrics to report, then analytical tools like that should do the trick. On the other hand, if you are looking to upgrade your marketing efforts and explore the potential of AI in marketing, a more extensive tool including all tracking, attributing and AI automation should be your focus.

What is a multi-metric approach?

It is what it’s in the name. It is analyzing multiple metrics to steer your marketing efforts. By doing this you can single out things that are not performing well. for example

We all use metrics since we wouldn’t be able to show our added value to the company without them. Furthermore, we also use them to diagnose causes and project future events.

Measuring marketing activities allows marketers to make informed decisions and paint the picture of how well they use current resources. In other words, if you can’t measure it, you can’t manage it.

Some marketers measure their success based on one metric. But basing everything on one metric is like writing an entire thesis using only one source. In the end, it does not say much.

Implementing a multi-metric approach in your marketing efforts allows you to gain a more holistic view of how your campaigns are impacting different areas of your business. By using multiple metrics to evaluate the effectiveness of your strategies, you can gain insight into areas such as lead generation, customer engagement, and sales. This allows you to make more informed decisions and optimize your strategies for better results.

If you solely focus on ROAS (Return on adspent) and CAC (Customer aquisition cost) you will miss out if your advertisements are performing well enough. Let us give you two scenarios.

Clicks: 500

Conversions: 50

Revenue: 1000$

Adspent: 500$

These are nice to look at right? Do the math: CAC of only 10$ and a ROAS of 2. For any small business these numbers are nice to look at. But what if the impressions are 30.000? That means the Click Through rate is only 2%.?

Now you will draw very different conclusions right? Why is it only 2%? How are we able to increase this? Maybe if we increase the amount of clicks, conversions will be higher?

That is the right way of thinking.

Now example 2, this one will be more in depth and reveal causes outside the advertising.

A company has a high ROI of 200% and a low CAC of $50 per customer. This may seem like a winning combination, but it could be masking a deeper issue in the customer journey. For example, the company may be acquiring customers through aggressive discounting and promotions, which are driving a high volume of short-term sales, but are also causing a high rate of customer churn.

A multimetric approach would reveal that while the company is generating a high ROI and low CAC, their customer retention rate is only 10%, meaning 90% of their customers are not returning to make another purchase. This is where the lifetime value of the customer comes in, and the company will see that the lifetime value is not high enough to sustain the business and that the customer acquisition cost is not justified.

By regularly monitoring and analyzing your data, you can make adjustments to your marketing strategy as needed to improve the overall performance of your business. And by sharing the results of your multi-metric approach with stakeholders, you can demonstrate the value of your marketing efforts and gain support for your strategies.

Why are we called Billy Grace?

We wrote an interesting article about why we are called Billy Grace! I dare you to make a guess why we are called Billy Grace, we bet you will not guess the origin. Do you want to check if your guess was right?

Click the article here: https://www.dhirubhai.net/pulse/why-billy-grace-called-billygrace/

TL;DR

1. Ad platforms often overvalue their role in conversions, leading to conflicting reports and inadequate credit for other channels.
2. Cookies' short-term memory and inability to track across devices make data unreliable.
3. Solutions include cookieless tracking, hybrid attribution models, and cross-platform reporting for better insights (If you want to know the specifics do read the article :) ).
4. Choosing the right tool depends on your company's needs, such as accurate metrics reporting or AI automation.
5. A multi-metric approach analyzes multiple metrics to gain a holistic view of marketing campaigns' impact.
6. Relying on a single metric limits understanding and decision-making.
7. Multi-metric approach helps evaluate lead generation, customer engagement, and sales for informed decision-making.
8. Regularly monitoring and analyzing data allows adjustments to improve overall business performance.
9. Sharing results of a multi-metric approach with stakeholders demonstrates the value of marketing efforts.