Through a special arrangement, presented here for discussion is an excerpt of a current article from Retail Paradox, Retail Systems Research's weekly analysis on emerging issues facing retailers.
Ironically, just as the technology and the infrastructure is approaching "reasonable" for in-store implementations, something is happening online: the results of online marketing are becoming more difficult to measure. Think about it - the metrics that most people cite for online today are these "surface level" metrics. Things like "click-throughs" and "page views" - traffic and conversion. These were the things that we could measure in the early days of the web.
But now we have Web 2.0 and social networks, and far more complex sites - all of which are completely underserved by standard, surface level metrics. Like in the store, traffic and conversion rates (sound familiar, online marketers?) are only proxies to help us understand what we really want to know: customer engagement, and how that engagement translates into sales.
Online clickstream data fills in the blanks for eCommerce store navigation, but as with stores, it doesn't give you the whole picture - and that picture is increasingly difficult to bring together. I encountered the concept of "the deep Web" just last week - the enormous amount of content that exists on the Web today but is not indexed by search engines. Search engines can't find a lot of this content because it is dynamically generated - in other words, the "page" that the search engine would index does not exist until a user creates the need for it, and the page goes away as soon as the user's need is done.
Just as there is a "deep Web" there are "deep metrics," and marketing has not discovered them yet - in part because we've become so hung up on the metrics we use today that we've forgotten that they were mere (and inadequate) proxies to begin with - they were simply what we could get. I think we can get more. For example, some companies on the leading edge of social networking as a business tool are looking at things like number of "friends" an individual has, or the rate that a person adds friends on a social networking site, as a way to understand the relative influence that a single person has. The more you understand a consumer's influence, the more valuable that influencer can potentially be for your brand.
Which is an interesting statement to make, considering concerns over consumer privacy. I can see two futures for metrics: the pure performance-driven metrics (Did it lift sales? Did people respond?), and this influencer/social engagement model. They exist at two completely opposite ends of a spectrum.
At the performance end, the world is reduced to triggers, behaviors, and context. If you see a behavior in a certain context, then it doesn't matter who it is, what the product is, or anything else - behavior A in context Z results in offer N. And offer N is measured purely by performance - did the individual respond?
At the influencer end of the spectrum, not only do we want to know all about you, Ms. Consumer, but we want to know who your friends are and how much time you spend communicating with them. It's all about your profile or persona - or even the multiple personas that make up "you." The more we know about you, the better we will be at meeting your needs.
Discussion Questions: What hurdles do you see in measuring online metrics around shopper engagement? Do you also see online driven metrics breaking down into performance-driven criteria versus influencer/social engagement?