Building Feedback Loops in Digital Marketing
A feedback loop, in a marketing context, is the process of gathering information about the performance of a strategy or tactic, then analyzing the data, and using it to adjust your content to improve your outcomes. For example, corporations such as Charles Schwab use feedback loops to achieve goals including attracting new customers and improving customer confidence in the brand.
First, Collect your Data
The first step is to ensure your metrics infrastructure is properly configured. This means that not only must you select the correct tools for measurement, but you also need to invest the time to configure them to meet your specific needs.
So what tools do you need? It depends on what you’re measuring. If you’re driving traffic to a web page, for example, use Google or Adobe Analytics. (Note, sometimes the tool you need is baked into the platform. For example, if you are measuring an ad on Facebook, no separate tool is needed–ad metrics can be found on Facebook.)
If implementing an initial metrics infrastructure, or updating an outdated one, work with your IT business partner. Note, this process can include everything from time to obtain approval for funding to time for a web designer to implement the tools, for quality assurance to perform tests, for cybersecurity to audit the updates, and even for IT to roll it out. This development and implementation process can take several months, time you must factor into your annual plan.
Best practices in configuring loops
Digital marketing feedback loops are a continuous process of collecting metrics, analyzing data, implementing, and testing.
1. Set your objective: Quantify it to ensure it is measurable.
2. Determine your key metrics: Analytics tools can, and will, drown you in metrics, many of them irrelevant. Determine what metrics you need and focus only on those. For example, say you are using a Facebook ad to drive traffic to a product page to generate sales. The table below breaks down the most critical metrics to watch for during each step of the customer journey:
3. Collect and analyze your data: Each step of the journey tells you different things about how customers react to your content:
· If your clickthrough rate on a social network platform, such as Facebook, is low it indicates a lack of interest with your post or your offer. In this case, A/B test your social post content. If your tests are inconclusive, your offer may not be compelling enough (change your offer) or you’re not reaching the right audience (change targeting criteria).
· If your website time on page and scroll rates are low, it indicates customers aren’t spending a lot of time looking at your content. Why would they click your ad but not browse your content? Chances are what they are seeing on your page doesn’t match the expectations you set. Is your offer placed prominently enough on the page? Or does the customer have to scroll to find it?
· If you see a high cart abandonment rate at the storefront, odds are your customer wants to make a purchase, but something is stopping them. They may find the cost of shipping too high. Or your promotional code isn’t functioning properly. It is critical that marketers evaluate every step of the customer journey to ensure it works.
4. Plan and implement changes, then measure again: If you have rolled out changes and you are now achieving your goals, you know you have been successful. If not, reanalyze your data. Either your data collection is flawed, your analysis is incorrect, or your correction is wrong. One way to gain greater insight over the long-term is to create a tracking document to note changes. This will help you reconcile changes with results so you can identify what does, and does not, work.
5. Don’t overlook simply asking your customers questions: You’ve acquired relevant metrics, performed in-depth analysis, A/B tested, but you are still not achieving your goals. Sometimes the simplest answer is the best: ask your customer. How? If you’ve been on the web long enough, you’ll have been presented with a request to fill out a “TRUSTe” feedback form. This form is placed there by the website owner, but the data is collected by a third party named TrustArc that collects the replies from customers to your questions and shares the anonymized information with you, the site owner.
While you could easily roll out your own feedback form (and many companies do), you’re more likely to get better quality results by using a system that favors anonymity because (1) most drop-off in forms happens when customers are asked to provide contact information, and (2) it emboldens customers to be brutally honest about their experience with your site, and that honesty can be incredibly valuable.
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