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Marketing Metrics & Quantum Physics
Sitting at the airport the other day, trapped by an indeterminately delayed flight, I picked up a copy of Scientific American. After all, for all the talk of science in marketing, it’s always good to get a glimpse of science in science for comparison.
I ran across an article on quantum physics with the intriguing headline, What Is Real? — a fine question to tackle at 10:47 pm on a Monday night.
The gist of it, in my crude layman’s interpretation, is that particles may not actually exist. At least not in the way most people traditionally think of those little bits of atomic matter. Those models of particles bouncing off of each other like little billiard balls? The kind you may have seen in your high school physics textbook? Not actually true.
Instead, they’re something else. That “something else” might be what is known as structural realism — the idea that the universe is not really about things, but rather relationships between things. For instance, a thing doesn’t have mass on its own. It has mass through its relationship with other things.
“What is the reason that we can only know the relations among things and not the things themselves?” asks the article. “The straightforward answer is that relations are all there is.” (Emphasis is mine.)
Deep. So what does this have to do with marketing?
Analytics Measure Things, But Marketing Is Relationships
If there’s one property about the digital world, above everything else, it’s the fact that it’s so measurable. It’s effortless to measure things: page visits, tweets, likes, email opens, click-throughs, etc.
But many of these things being measured — with the exception of revenue — aren’t the reality of business. There is no absolute value to a page view or a click-through. (Okay, online publishers are trying to make advertising revenue from page views and Google makes money on click-throughs from search ads — but that is the revenue exception.)
What matters is how customers and prospects think about your company. How they feel about doing business with you. These are the fundamental forces of the marketing universe, the basis of “brand.” But they’re effectively impossible to measure directly.
“Everything that can be counted does not necessarily count; everything that counts cannot necessarily be counted.” – Albert Einstein
Myopically emphasizing any one non-revenue metric — for instance, conversion rate on a landing page — runs a particularly high risk of diverging from the fundamental truth of how customers and prospects feel about your company. Having worked in the landing page optimization business for many years, I’ve seen a plethora of “tricks” that people use to boost conversion rates that don’t ultimately have a positive impact on the business.
In many cases, this isn’t intentional. It’s simply the consequence of narrow-framed objectives and incentives. It’s the particles-as-billiard-balls model equivalent for marketing. “Get these particles from this stage of the funnel to the next — and don’t worry about the next stage; that’s somebody else’s job.”
Any Single Metric Lacks Context
One way to counter metric myopia is to emphasize relationships between two or more metrics in marketing management.
For instance, the relationship between conversion rate on a marketing campaign and the ratio of marketing-qualified leads (MQLs) and sales-qualified leads (SQLs). This helps illuminate the quality of leads (measured by semi-independent people or processes) relative to the quantity of leads generated by that campaign.
Or, ultimately, you want to evaluate conversion rate on a campaign correlated with eventual revenue generated, such as initial contract value.
Granted, there’s an inherent challenge in analyzing these relationships: they reveal themselves over time. In long sales cycles, such as with B2B marketing, revenue correlation might take weeks or months to be revealed. And in that window of time, those prospects are subject to a number of other marketing and sales touchpoints, confounding the influence of any one touchpoint along the buyer’s journey.
Still, there are advantages to pursuing these “metrics relationships” views:
- It provides a “sanity check” to make sure that what’s being viewed as good or bad performance in a particular metric is reflected in another.
- It helps one recognize the “system dynamics” of marketing — it becomes more readily apparent when over optimizing for one metric is negatively impacting another.
- It encourages more collaboration across marketing and sales — an individual within the company may own one metric, but its relationship with a different metric often involves someone else.
Any good story doesn’t just have a single character. It is the interaction of multiple characters that makes stories interesting and meaningful.
The same applies to telling stories with data in our management of marketing.
Some opinions expressed in this article may be those of a guest author and not necessarily Marketing Land. Staff authors are listed here.