Friday, August 1, 2008

'Total Marketing Measurement' Is Closer Than You Think

As I’ve mentioned previously, most of my research these days is targeted at demand generation systems. So I was a little surprised that one of the demand generation products, ActiveConversion, positioned itself as a “total marketing measurement” system, complete with three letter abbreviation of TMM. A quick glance at the company Web site, followed by a conversation with president Fred Yee, confirmed that ActiveConversion has functions similar to other demand generation products: it sends email campaigns, tracks the resulting Web visits, nurtures leads until they are mature, and then turns them over to sales. ActiveConversion is a little unusual in not providing tools to build Web pages. Instead, it tracks behavior by embedding tags pages built externally. But this makes little practical difference, and the vendor will add page generation functions later this year.

Why, then, does ActiveConversion call itself a TMM? I think it’s mostly a bit of innocent marketing patter, but it also reflects the system’s ability to track Web visitors’ behavior in great detail and report it to salespeople. This is common among demand management products, but not a feature of traditional Web analytics, which is more about group behaviors such as how many times each page is viewed. In some sense, this detailed individual could reasonably be described as “total” measurement.

In practice, the “total” measurement by demand generation systems is limited to behavior on company Web pages. This is far from the complete set of interactions between a company and its customers. But as the scope of recorded transactions expands relentlessly—something I personally consider an Orwellian nightmare, but see as inevitable—it’s worth contemplating a world where “total” measurement truly does capture all behaviors of each individual. At that point, marketers will no longer be able to hide behind the traditional barrier of not knowing which messages reached each customer. This will leave them face to face with the need to take all this data and make sense of it.

Much as I love technology, I suspect there are significant limits to how accurately it will be able to measure marketing results at the individual level. But meaningful predictions should be possible for groups of people, and will yield substantial improvements in marketing effectiveness compared with what we have today. But this will only happen if marketers make a substantial investment in new measurement techniques, which in turn requires that marketers believe those techniques are important. The only way they will believe this is to see early successes, which is why marketers must start working today to find effective approaches, even if they are based on partial data. After all, it’s certain that the quality of the information will improve. What’s in question is whether marketers make good use of it.

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