ROI Recipe: Analytics and Repetition

ROI Recipe: Analytics and Repetition

A delicious chocolate-chip cookie recipe is not just blundered upon. It comes from practice, preparation, mistakes, attentiveness, repetition and most of all analysis. Sure, there is an agreed upon formula, but every baker knows the nuances of their individual recipe -- such as the proportions of their ingredients -- so that they can yield the flavors they are looking for. This same thought process must be at the core of every businesses' marketing strategy.

All bakers are after the same thing -- a delicious and profitable snack that stands out -- just like all business owners are after the same thing from their marketing -- a significant "return on investment." Knowing the perfect balance of direct mail to email marketing, like knowing the right amount of sugar, can only be done correctly if the analytics are monitored, recorded and analyzed. Through this process conclusions can be drawn and can then be implemented into the next batch of marketing.

Every marketing decision a business makes must focus on what the numbers reveal. Analytics are the measuring cups of marketing. A new dental practice, Dr. Gloria Brown's for example, is trying to gain new patients. She knows a bit about the demographics that her practice is targeting and believes that direct email and social media ads are the keys to getting new patients into her office. She markets to the area using a standard approach: email, direct mail, radio spots and social media.

While it seems more time-effective to use this broad approach, her marketing recipe is bound to fail if she does not track and react. Without a tracking system, every dollar she spends towards marketing her practice -- whether or not it succeeded in getting new patients through her doors -- was wasted.

Unlike the baker, who gets an immediate response from their taste-tester, Dr. Gloria Brown has to wait. A successful tracking strategy needs numbers. After a month she realizes that 150 new patients have walked through her doors, and by surveying them it is revealed that 40 percent of these patients made appointments because they saw her email. Dr. Brown can now react and shift her efforts into an email-heavier campaign.

Knowing precisely how her new-patients found her practice allows Dr. Brown to take her marketing to next logical level -- more analytics. She sends out three email templates and tracks the results of each email. Using this data she can then find which template works and can improve her campaign. She is only capable of doing this by scrutinizing every step she makes, every marketing decision.

While a baker improves with every batch of cookies, a truly successful marketing investment only occurs through reiterations. By not assuming, and instead testing every step of the strategy, interpreting the data and inserting the results into each future batch the baker presses on knowing they are getting closer to the perfect taste. Marketing a business is the same. Every marketing move yields data that must be statistically evaluated and then used in every future decision. A lucrative return on investment can only thrive through tracking, analysis and repetition.

This blogger graduated from Goldman Sachs' 10,000 Small Businesses program. Goldman Sachs is a partner of the What Is Working: Small Businesses section.