The Fourth Wave of Marketing Measurement: People

by Jon Viray

posted on 11-16-2016

When marketers say “people’s interactions” or “consumer behavior,” what we really mean is that we know a device (e.g., phone, tablet, laptop, etc.) interacted with content. Historically, marketers were unable to connect all those devices to one person — though, we all knew the average consumer used several devices to interact with a single brand. Yet, the reality not to be forgotten is — devices don’t buy things; people do.

The fourth (and current) wave of marketing measurement will be/is built upon metrics that deliver insight regarding what really matters: people.

In this post, I’ll highlight the metrics that form the foundation of legacy-marketing measurement, explain why they don’t meet marketers’ needs, and show how people-centric metrics are the future of marketing measurement — all against the backdrop of one of baseball’s favorite stories: Money Ball.

Money Ball: An Example of Measuring What Matters.
Money Ball is a hallmark example of the competitive advantage that comes from measuring what matters. Imagine a baseball team made up of players with slightly awkward pitching styles, substandard batting averages, and less-than-optimal stolen-base success ratios. Is this a winning team? It depends on who you ask.

Billy Beane, the general manager who built this unconventional team, knew they could be winners because he knew what to look for. But the industry — and even his own staff — thought rebuilding the Oakland A’s with these apparent misfits would spell the end of his career. All because the best minds in baseball didn’t traditionally lead with their minds; they went with their gut instincts, and their guts told them that Billy Beane was assembling a roster that couldn’t win.

The season started rough, but Billy convinced the team’s owner to push the naysayers aside and stay the course. They began the season with the third-lowest budget in the league and ended the season with the longest winning streak the league had ever seen — something the Yankees never accomplished, even with a budget almost three times that of the A’s!

Marketers have the same opportunity today: stop relying on instincts, and start using data and connecting that data to actual living, breathing (and anonymous) people. Market to people, not devices, and gain a competitive advantage — and do it before the rest of the world figures out what’s happening.

The Past
First, let’s take a stroll down memory lane to see where marketing measurement has been. Then, I’ll wrap this post up by showing you where marketing measurement is headed.

Wave 1 — Early 90s: Hits
Definition of hits: The number of web-browser requests to a webserver.

Shortcoming: The inability for hits to delineate between 10 images loading or 10 people visiting a webpage leaves marketers unable to answer rudimentary questions such as, “Which pages are the most popular?” or “Which pages are the least popular?” Measuring hits to understand people is like measuring the number of hotdogs sold to understand a ballgame — it doesn’t help much.

Wave 2 — Mid 90s: Visits
Definition of visits: A session of continuous activity in which hits from a single web browser are rolled into a visit that expires after a period of inactivity.

Shortcoming: Given that visits reset after a period of inactivity (and often, after 24 hours), it’s a poor method of understanding people. Using visits as a proxy for people leads to incorrect insights regarding which marketing channels are most effective and how people pass through the conversion funnel.

Wave 3 — Late 90s: Visitors
Definition of visitors: Cookies are used to stitch multiple visits from the same web browser into one visitor.

Shortcoming: While better than visits, visitors is often interpreted as being synonymous with people, but it’s not. Visitors don’t encompass multiple devices. Measuring visitors creates an illusion regarding which marketing campaigns are most effective and where marketers should invest their budgets. Using visitors as a proxy for people leads to inefficient marketing, incorrect insights, and wasted marketing dollars.

The Present and the Future
Wave 4 — Now: People
Like Billy Beane’s naysayers, many people in the industry today believe that true people-based marketing is out of reach, that it’s still science fiction. This is false. But, the fact that they believe it’s out of reach gives those of us who are bold enough to act a competitive advantage.

People-based marketing is available today to give marketers the metrics that really matter and the ability to take action on those metrics on any marketing channel.

The Future: People-Based Marketing
The future of marketing is people-based marketing that delivers insights such as which experiences are best suited for the person behind a specific device in a specific segment of the customer journey.

The future of marketing is people-based marketing that delivers action based on the entire relationship between a brand and a consumer — not a brand and a device. This action will span devices and be able to curate a stream of meaningful content that flows smoothly from device to device but always to the same individual (anonymized) person.

For example, an online retailer has made substantial progress with incentivizing their visitors to log on to their website, so marketing can use their propensity model to offer a product that the consumer is most likely to buy. But, a sizable portion of this retailer’s traffic is still buying from them regularly without logging in first, which renders their propensity-scoring model useless for this customer segment.

With true people-based marketing, this same retailer could integrate a device graph that would allow them to offer the right product at the right time to their consumers — with or without logging in.

And, this is all available today.

Billy Beane ushered in a new future by leveraging the latest statistical models to analyze and understand the art and science of baseball. That new future is now the status quo to building a winning major league baseball team.

Marketers have the same opportunity to usher in a new future today. Consumers already expect their experiences with brands to be consistent across devices and channels. And, by virtue of consumer expectations rising, marketers must expect more from themselves and their technology providers.

Now is the time to rise to these expectations and enjoy the benefits of customer satisfaction and competitive advantage.