3 Steps to Multichannel Measurement on a Budget

There are several great enterprise data platforms that can put you on your way to algorithmic attribution, but many marketers don’t have the budgets to support that investment. So how do you determine which channels are performing best for you without relying on simple but unsatisfactory attribution methods like first exposure, last click or arbitrary weighting?

There are several great enterprise data platforms that can put you on your way to algorithmic attribution, but many marketers don’t have the budgets to support that investment. So how do you determine which channels are performing best for you without relying on simple but unsatisfactory attribution methods like first exposure, last click or arbitrary weighting?

Here’s a relatively easy way to measure the incremental value of each marketing channel to determine which channels are performing best so you can optimize your marketing mix.

First, pick a set of geographically similar markets — one for each channel that you’re using plus one to act as a control cell. Make them as closely matched as you can in terms of size and demography — so don’t mix big markets like Chicago with smaller markets like Waco. You also want to stay away from markets that have competing media — for example, Princeton, N.J., is exposed to both New York and Philadelphia media. Data from the Statistical Abstract of the United States and Census.gov can help you select markets that work for you.

Second, create a test matrix where one of your markets serves as a control, and the balance of your markets eliminate one of the channels you’re evaluating. For example, in the matrix below all channels are used in the control cell, and one channel is eliminated from each of the test cells.

Chuck McLeester chartConduct your test long enough to get a statistically reliable number of responses. With 250 to 300 in each column and each row, you can be 90 percent confident that your results won’t vary by more than 10 percent in a rollout scenario.

Third, examine your cost per response by market in a matrix like the one below. (These numbers are for illustration only and are not meant to reflect actual costs or responses from these channels.)

Cells that have a higher cost per response from the control indicate that the channel you eliminated from that geo area is valuable to you because it was lowering the average cost per response in that cell. In the example below, the geo areas where email, search and social were eliminated had a higher cost per response overall, indicating that these channels were important parts of your media mix. Cells with a lower cost per response from the control indicate that the channels eliminated from those geo areas were increasing your overall cost per response. In the example below, direct mail, display and mobile all had higher costs per response than the control cell which included all the channels.

Chuck McLeester measurement chartYou can do the same analysis on revenue and profit if you are engaged in catalog or e-commerce. The difference in profit between the control profit and the profit in each equally matched geo cell provides the incremental value, whether positive or negative, of the channel that was omitted in that cell.

Chuck McLeester money chartThis experiment has its limitations. Your markets will not be perfectly matched and external factors can affect your results. However, it will provide valuable insight about the interplay among the different elements of your media mix.

Finally, remember that eliminating different channels from your media mix will also have an effect on your response or sales volume. To understand how to best manage volume within your allowable cost per response or cost per order, check out this former Here’s What Counts post.

What Type of Google AdWords Campaign Is Best for You?

If you are new to Google AdWords, you might be completely unaware of all the different types of AdWords campaigns from which you can choose. Most people think solely of the ads that appear in Google search results.

If you are new to Google AdWords, you might be completely unaware of all the different types of AdWords campaigns from which you can choose. Most people think solely of the ads that appear in Google search results. This makes sense, because anytime you run a Google search, the list of ads is easy to see. Yet this is just a fraction of what Google AdWords has to offer. Choosing which type of AdWords campaign to use depends largely on exactly what you sell and who makes up your target market.

The Search Network

The search network is where I recommend most businesses start. After all, people who see your ads in search are actively looking for whatever it is you sell. In many ways, the search network is the new Yellow Pages. In the “old days,” people looked up what they wanted under a category heading in the phone book. Now they do the same thing in Google. Plus, if you target the Search Partners in your ad campaign, then your ads will display not only in Google search, but also other Google partners such as Amazon, AOL, and Ask.

The Display Network
The display network consists of over a million news sites, blogs, articles, and other websites that accept text ads, banner ads, and video ads from Google AdWords.  This type of advertising is often called “interruption marketing,” because it interrupts what the viewer is doing rather than showing up when that person is actively searching. That means to be successful with display network advertising, your ads and landing pages need to be carefully crafted to this specific purpose, rather than simply reusing your search network ads.

The Shopping Network

Do you remember the old department store catalogs? Sears still puts out a particularly nice one known as the Wish Book for the holiday season, though it’s also digital now. Anyway, the shopping network is the online equivalent of a catalog that stretches across not just a single company, but thousands.

If you sell products rather than services, and you have an online storefront for customers to complete their purchases, Google Shopping might be an ideal choice for you. Your ads will appear not only when users specifically search within Google Shopping, but also when a regular search triggers Google Shopping results. Just be careful. You are only allowed a product image, price, and name, without the text that accompanies a search ad. Make sure your ad speaks for itself.

The Video Network

If you have spent much time watching YouTube videos, you are probably aware of the pre-roll videos, which look much like traditional TV commercials. However, unlike a traditional television commercial, you do not have to pay every time an ad begins. Instead, the video network uses a pay per view (PPV) advertising model. Pre-roll ads give viewers the option to skip through the ad. If a viewer clicks the Skip button, you are not charged for that display. In addition, a regular commercial requires the user to make a phone call or type in a URL to take action. In a pre-roll video ad, all the user needs to do is click on the video to visit your website.

The App Network

The app network focuses specifically on getting prospects to download your mobile app or digital content, or to engage more fully with your app. The ads are displayed only on smartphones or tablets, and redirect the user to the appropriate download site or spot within your app.  The app network is geared toward those targeting the younger generation or trying to build a robust market for their apps.

Managing Multiple Networks
If you’re just getting started and you know potential customers are searching for your products or services in Google, then I recommend setting up a search network campaign.  If you have an e-commerce business, then the shopping network is another opportunity to gain additional exposure.

Once your search and/or shopping campaign is working well, then expand to the display network to get in front of potential customers while they are surfing the internet.  Also, if you have the resources to create a pre-roll video ad, then the video network is a great opportunity because there is still very little competition, which means lower ad costs.

Regardless of which networks you choose, be sure to test different ads and landing pages for each campaign.  Just because one ad and landing page combination works well in the search network doesn’t mean it will work well in the display network, and vice versa.

Want more Google AdWords tips? Get my Ultimate Google AdWords Checklist.