Exploring Data-Driven Marketing: Q&A with Metric Theory

Today we’re featuring a Q&A with Adam Edwards from Metric Theory. Adam is one of Metric Theory’s Founders and serves as Vice President of Account Services, leading a team of more than 30 paid search and Facebook advertising professionals and owning the results for over 160 customers. Metric Theory recently released a success story that shares how they looked beyond basic PPC metrics to improve the bottom-line of the business for retailer NorthlineExpress.com, all while leveraging Skai. You can read more on this case study here and can continue on below to hear more about Metric Theory’s approach to data-driven marketing. 

Metric Theory’s tagline is “Data Driven Marketing.” Given this, what are some of the guiding principles your teams follow when it comes to analyzing and applying data? 

More than anything it’s making sure that we put that data to work. There is an overemphasis on the analysis piece, but data analysis only bears fruit if you’re implementing change. On that front, I think too many advertisers let perfect be the enemy of the good. If you don’t have enough data at the keyword level, look at the ad group or campaign level for larger trends. Can’t draw any conclusions on how performance varies on individual days of the week?  Separate weekdays from weekends. There are large insights to act on, so don’t wait for the perfect data set to come along.

Additionally, it’s remembering that testing is a means to an end. We test ad copy, but you shouldn’t always be running 2+ ads in an ad group. That means you’re sending at least half your traffic to a lesser performing ad. The goal of all that testing is to let the data help you make a decision and then funnel more of your impressions to the higher performing ad. Again, the analysis is nice, but you want to put that data to work in a way that drives improved results.

You work with a number of eCommerce brands. Are there any common challenges you see within this vertical? What are some of the best practices you’ve uncovered?

We love to work with niche eCommerce brands. That said, competition, in particular from Amazon and big box stores, is more daunting than ever. To keep up, you need to understand how your competitors are spending and how your customers are searching.

On the first point, you should be checking the auction insights report from Google regularly for top terms. Three or four years ago, you couldn’t see how often competitors were showing on overlapping terms; now you know how big of a fight you’re in for.

As for the customers, put yourself in their shoes. If I were searching for (blank) on Google and I saw these ads, what would entice me? What would I want and expect on the landing page after I clicked an ad? We have the benefit of seeing exactly what ads will show on a given search, and many advertisers just aren’t honest with themselves about the likelihood of their ad winning that click. At Metric Theory we strive to make the user experience as friendly as possible to highlight our clients unique selling proposition, and then once we win the click, we ensure that it is as easy as possible to convert.

NorthlineExpress.com is a recent success story you’ve had, increasing the retailer’s net profit by 40% year over year. What were some of the strategies your team deployed and how was Kenshoo leveraged to achieve these results?

NorthlineExpress.com’s success stemmed from implementing changes based on the data we already had. We had driven big improvements in Northline Express’ return on ad spend (ROAS) in our first year managing their account. Yet despite 50%+ improvements in ROAS, and the team was telling us that it wasn’t making a dent in their profitability. They provided us more information on their product margins, as well as shipping costs so that we could re-evaluate our goals.

By customizing a net profit metric in Skai, we were able to determine that some our highest ROAS campaigns were not actually profitable because they were selling low average order value (AOV) items where the shipping costs ate up all the margins.  We acted on that and focused on campaigns that sold higher price-point items with a stronger net profit. Skai made that very easy to identify.

With the complexities of today’s digital ecosystem, what are some of your tips to stay ahead of the curve? 

The online path to purchase continues to get more and more complex. There are more digital channels and more devices that influence our online purchases each year.

It’s crucial to understand what that path looks like for your customers. Even if you don’t have an expensive attribution modeling platform, you should be in tune with what different attribution models look like. We’ve had some clients who’re still using the default last click attribution, which tends to over-credit direct site visits and email traffic. Multi-touch and position-based attribution models, such as those in Google Analytics, provide a more holistic view and will let you see if you’re undervaluing paid search, social, etc.

The most important macro decision for many eCommerce brands is how much budget to invest in which channels. This is a first step in making sure that allocation is appropriate.

To download your copy of the NorthlineExpress.com case study, click here.