Learn to Extract Marketing Insights from Data

by Eric Tsai

Learn to Extract Marketing Insights from Data
In working with many smart business people and analysts in the past few months, I came to appreciate the ease of accessing web analytics.

Who knew that math and data would become a main revenue driving force for businesses big and small?

Every business is fast becoming a data-generating machine.

From upstream to downstream, data rewards us with actionable insights to make profitable decisions via controlled experiments allowing us to advance our business models.

And yet, this is just the beginning as the number of people connected to the web continues to grow, so too does the vast amount of information about those individuals.

According to McKinsey Global Institute, “collecting, storing, and mining big data for insights can create significant value for the world economy, enhancing the productivity and competitiveness of companies and the public sector and creating a substantial economic surplus for consumers.”

 Big data: The next frontier for innovation, competition, and productivity

Collect and Analyzing Data for ROI

We can’t mine data we don’t have, so now is the time to focus on data gathering.

Simply put, data will produce new value for businesses whether it’s setting up web analytics, collecting email addresses or compiling transaction data, the ability to turn data into actionable insights equals the ability to make money on the social web.

In addition data is the foundation for business return on investment (ROI) that enables predictive analysis to explore highly targeted and optimized marketing campaigns.

ROI-centric businesses focus on maximizing the lifetime value of a customer, which in many cases refers to customer retention and the cost of sale.

That means leveraging weighted algorithms and attribution models to target and re-target the “next-best” opportunity.

The key is to put data in context and “translate” them into meaningful key performance indicators (KPIs).

For example, a controversial topic that I often come across is the concept of social media ROI.

In reality, social media analytics and engagement data do not have a transparent cause-and-effect ROI so analyst Jeremiah Owyang of Altimeter Group came up with a simple formula to look at social media ROI.

Social Media ROI

By focusing on business goals, he recommended companies to develop a standardized way to measure first based on objectives, a fundamental starting point to put ROI in context.

An important aspect of reporting ROI is to put data in perspective for everyone involve. It’s indicative that social media ROI requires mapping the right data to the right role because different data sets mean different ways of measuring, segmenting and analyzing.

The Increasingly Social Search: Social Media Data

Although search engines such as Google, Bing and Yahoo have provided tremendous insights into customer behavior, the rise of actionable social media data is adding fuel to the explosive growth of digital information.

Now that Search engines are integrating social signals into their algorithms, social is going to play an important role to increase efficiency in targeting.

Facebook, LinkedIn and Twitter can help generate even more granular, multifaceted customer segmentation from profiles, posts, click histories, and usage logs by identifying influencers and leaders within social groups, as well as their followers and outliers.

Not only can Social media distribute marketing messages out faster, they allow companies to gain deeper insight into customer behavior in much more detailed than it has ever been.

In addition, social media enters into early majority phase of adoption according to a recent survey by Regus, more firms are using social media to engage with existing customers than a year ago, with the following highlights:

  • 50% of businesses in the U.S. use websites such as Twitter to engage, connect with and inform existing customers
  • In the U.S., 55% of firms encourage their employees to join social networks such as Linkedin and Xing
  • 38% of U.S. companies dedicate up to 20 percent of their marketing budget to business social networking activity
  • Globally, the survey reported a seven percent increase in the proportion of businesses successfully recruiting new customers through social networks such as Facebook

Geolocation: Adding Space and Time to Data

Local data is one of the most valuable forms of data because it can put local business in touch with potential customers while they’re in the vicinity of the business.

Do you wonder why all of a sudden people are “checking in” on Foursquare, Yelp, Facebook and Twitter?

According to IBM Engineer Jeff Jonas, “With roughly 600 billion data transactions from cellular phones on a daily basis, adding space and time to traditional data objects can help predict where someone will be on a given day and time with up to 87 percent accuracy, for example. Adding space-time works because, oddly enough, of physics.”

Watch live streaming video from gigaombigdata at livestream.com

The Take Away

The bottom line is that it is about giving youself the highest chance of marketing success by targeting customers that fit your business model.

Needless to say that it is important to collect the right data (context counts!), but the intrinsic value is in your ability to extract actionable insights beyond trends and patterns that reveal profitable opportunities.

The only question that remains for you is this – what data are you collecting, why, and how does that fit into the big picture?

I recently gave an interview to Adobe’s CMO.com about this topic.
Check it out: McKinsey Report Calls For New Generation Of Web Marketing Analysts

What is Product Development and How do I do it?

by Eric Tsai

ideabulbThis article is for people that have no idea on what goes into product development, how they can develop a product even without being a designer.

Product development is the process of bringing a new product or service to market.  It typically has a set process called product life cycle:

  1. Idea or concept
  2. Market research and analysis
  3. Product design
  4. Engineering and development
  5. Testing and launch

Your product can be anything from physical goods to software on the internet.  It can also be a service you provide such as washing cars or transporting goods.  My very first product development project started when I was an art student in college. My goal was to put my artwork on to a website so I can showcase my artwork.

I was interested in using the web as a medium to communicate my concept approach to art and it was not about designing a website. My curiosity to learn has led me to study web publishing and the birth of my first website designdamage.com in 2001.  I then continue to develop multiple versions of my website which landed me a job as a web designer after I graduated.  In the years that followed, I was tasked to design packaging, graphics, catalogs, advertising, interactive movies, motion graphics, and even apparels and accessories.

Because of my entrepreneur mindset I never look at myself as a designer; instead, I simply try to solve the problem in front of me.  This attitude has led me to focus on strategic and business approach to product development.

Today I will discuss the different ways you can develop your product even if you’ve never done it before.  If your goal is to develop a product for business, or as your business, you will find the ideas below of interest.


How to Put Your Development Project into Perspective

pdpComing up with new ideas could be easy for you but difficult to execute.  Your goal is to develop a working prototype, or ideally, go to market with it.  Market research and analysis are vital to the decision making process, so your first goal when putting the project in perspective is to define the product from some initial market research.

Obviously no product is perfect especially when it’s a fresh new concept.  It’s through testing and iterations that a product improves usability and provides value to the end user.  It’s important to focus on the ideal outcome of your product and match those to your market research data.  This will enable you to create a list of feature sets that deliver the desire outcome.  Even if you aren’t sure exactly how to achieve those feature sets, having the list will maintain your focus on the benefits you want from the product.


How to Conduct Market Research and Analysis

The easy and fast way to start your research is via search engine like Google or Yahoo.  Simply use keywords with your product categories will do the trick; for example if you are developing a new soda drink, search for “soda market growth” or “annual soda market sales.”  Keyword searching is an excellent starting point, and you should conduct both web and images search as you may find some unexpected results.

Check document repository sites such as Scribd, SlideShare, and even Youtube will also yield some interesting information.

Another method is to research your competition that’s already in the market.  Even if they don’t offer the exact products or services, their customer base may be interested in what you have to offer.  Review their website, catalog or engage people that sell their product, get a good feel for where they stand in the market.  I also recommend identifying the market leaders in your sector that are public companies so you can download their financial reports or listen to their conference call via their website or Yahoo Finance.

If you have cash to spare then paying for a research report is another way to start your research.  If your product concept needs a lot of market data to support the idea, then you better be serious about purchasing some real research and analysis reports from professional firms such as Frost & Sullivan, IDC, Ipsos, Gartners and Forrester.


How to Leverage Outsourcing to Help Design and Development

Once you have a good grasp on what it is you’re going after, you need to start the product design process. If you’re like me, you can certainly utilize design skills to save some costs before you take it to the engineers or developers.  As a visual person I like to create diagrams, charts and tables to lay out the concepts first before I start the actual design.  Use the tools available to you to write up some sample use cases and creating storyboards are the best way to communicate the idea behind your product.

Think of it as narrarating a TV commercial, how would you convey what it is that you’re selling? What are the features and benefits?

If you are not a designer, I strongly suggest that you outsource your product design process.  The key is to have your feature sets ready so you can communicate them to the designer efficiently and still control the development costs.  Provide designers or developers your use cases and have them mockup the storyboards while you evaluate their understanding of your product.

End-to-end solution is what you want so you can reduce the time-to-market factor.  Remember time is money so provide as much information as you can.  Having samples or even your own drawings could make a difference to ensure your developers understand your concept.

Where do I go to find designers? And what if I need an engineer or software developer?

You can use outsourcing sites like Guru.com, Elance.com or CodeSnap.com.  These communities have a proven platform for you to find the right talent and get the project started with competitive rates that includes contracts, NDA and approval processes.  You can also get quotes from independent sources such as Coroflot and AIGA, where you could contact the developers directly.


Product Testing and Pre-Launch

Once you have a working demo or prototype, it’s time to put it through the constructive criticism test.  This is the part where you have to be the most demanding person on your own project.  You need to be strategic about your sample and like my discussion on perceived value, you must be realistic.

You can choose to make changes to your product, launch it in beta mode or pre-launch it to a diverse range of groups for your target audiences to review and experience the product.  During this phase, it is extremely important to document everything and get as much feedbacks as possible.  The more feedbacks you can get the more information you’ll have to plan you next iteration.

The relationship between product design, development and testing are the core drivers of a successful product, so if you intend to take your product or business seriously you need to know your market, put a development roadmap in place and have a solid method of product evaluation.

If you want more details on design principals involving product design I suggest you read my 3 part series on good design.