Metrics are the marketer’s microscope. They show him what his customers are actually doing, as opposed to what they say they are doing or intend to do. With proper metrics he can make decisions faster and more accurately.

You can decide to measure anything, but what metrics matter and what ones are just for show? Here are some rules I hope will guide you toward creating meaningful metrics that help, rather than hinder, the decision-making process.

Be Actionable

Be Understandable and Trustworthy

Measure Results

Understand the Downside

Understand the Upside

Don’t Be Ambiguous

Segment by Purpose

Appropriate Granularity

See the article at 8 Tips for Crafting Metrics That Matter

The title is Web Analytics 2.0: the Art of Accountability and the Science of Customer Centricity.

I read his blog regularly, and I look forward to the book.

He was recently interviewed on Mitch Joel’s excellent podcast Six Pixels of Separation. I recommend that readers visit the Six Pixels of Separation blog to listen to the entire interview (and other podcasts).

There are a couple short passages that I want to call out from the beginning of the interview. He says about his upcoming book:

“You’ll see me frequently use the words analyst and marketers….to me, really there isn’t an analyst that isn’t a marketer behind the scenes, and there isn’t a marketer that isn’t an analytst behind the scenes.

We live is such a data-driven world where the web experience and the customer experience is changing with every passing day. Every marketer needs to know that data, analytics, qualitative quality is going to give him or her the edge. And every analyst needs to know that unless he deeply understands marketing, he or she can never do analysis that creates great customer experiences.”

This is precisely the concept that led to the term “creatalytics.” It is the confluence of creative and analytics, of marketing and data. These can no longer be separate disciplines.

Links:

Six Pixels of Separation podcast interview of Avinash Kaushik
Avinash Kaushik’s blog Occam’s Razor

“Those hoping for a turnaround in the U.S. ad economy next year could be sorely disappointed, according to a new forecast from WPP’s GroupM. What’s worse, the new research predicts that outlays in 2010 will decline even more than they will this year.”

“Global ad spending in measured media is expected to drop 4.4 percent to $425 billion in 2009 compared to 2008 when spending was up 3 percent”

GroupM Futures director and chief forecaster Adam Smith said … “The 2008-2009 period is now a more serious advertising recession in scale, duration and relative to the global economy than the extraordinary 5.1 percent real-terms post-dot-com global advertising correction of 2001,” Smith said.

This article and study were brought to my attention by Tony Brock of thinkLA. Here are my thoughts:

Reduction of budgets will certainly continue throughout 2009.

But an equally dramatic trend will be a substantial shift of budgets from brand campaigns to paid search and SEO work. With the right analytical discipline, SEM in particular can be fine tuned and refined very quickly, giving it the agility to always be optimizing for maximum return on advertising dollars.

Here is a relevent, albeit anectdotal, blog post from Craig Hordlow at Red Bricks Media: http://www.redbricksmedia.com/blogs/craig_seoblog/?p=129

Tony raised the question of what ad agencies are doing or should be doing. In my opinion, they should be working very hard to build and grow SEM and SEO services, with a very serious commitment to analytics.

I can’t say this loudly enough: data-driven marketing is not a trend. It is the new toolset.

And when I talk about a commitment to analytics, I don’t mean as an *alternative* to focusing on creative. Not at all. The two need to meet. Fuel one another. This is what I mean by Creatalytics.

If agencies haven’t embraced the use of data analytics to get a better understanding of what works in creative, then they will be left far behind.

(AdWeek: GroupM Projects Ad Spend Slump Will Last Into 2010)

Seems like a fitting day to introduce a concept that has guided much of my thinking, something that is key to what I’m writing about on the Creatalytics blog.

Darwinian Marketing is the term I use for an approach that involves applying the framework of natural selection to systems that test website variations, ad copy variations, conversion scheme variations, and much more in a manner that allows an evolutionary process to occur and ensures that the strongest survive and an evolve.

On the very last page of The Origin of Species, Darwin writes:

“Thus, from the war of nature, from famine and death, the most exalted object which we are capable of conceiving, namely, the production of the higher animals, directly follows. There is grandeur in this view of life, with its several powers…from so simple a beginning endless forms most beautiful and most wonderful have been, and are being evolved.”

There is no simpler, yet more important concept, in understanding nature. And this concept can inform our understanding of many things far beyond natural science: complexity, emergence, economic systems, and yes, data-driven performance marketing.

It provides the key insights that allow us to bring analytics and creative thinking together in a way that propels  our online marketing efforts.

In my posts thus far, especially in my post “K.I.S.S., my ass,” I’ve started talking about how a savvy Internet marketer can and should feel confident embracing complexity, in building systems that allow them to learn lessons and take action based on lots of data.

I’ve written that “keeping it simple” in the sense of “less is more” is no longer necessary to get actionable knowledge out of data, because if you’re smart in building your systems, processes, approaches, and tools, you won’t need “fewer” to have simple.

Rather, if built correctly, simplicity—and elegance—will emerge from complexity.

For me, a key part of this approach is in understanding how the lessons of natural selection apply to this work. Creative iteration, copy fidelity, periodic mutation, and either a punctuated or gradual evolution. Conversion path optimization as ecosystem.  

Darwinian Marketing.

More to come on this concept. Stay tuned.

And with code, that meant making a clean plan for development and keeping the code organized, economical, and efficient.  The fewest and most straightforward instructions to accomplish the goal.  Elegance.

Wikipedia says:

“The KISS principle states that design simplicity should be a key goal and unnecessary complexity avoided.”

One of the main ideas that I’d like to impart in this blog is that simplicity and complexity are not mutally exclusive. The key to the above definition is the word “unnecessary.” And as data capture becomes easier and analytics becomes more sophisticated and manageable, one is able to maintain simplicity with greater levels of complexity.

So on this blog, I will speak to this issue frequently. I want to explain how I’ve come to embrace complexity in data-driven marketing, and how I believe this approach has been a major contributor to business successes.

I want to be clear: I’m not against “simple.” I just know a different kind of simple than the one I hear about frequently. For me, it’s taken on new meaning, one which does not equate “simple” with “less.”

My kind of simplicity is about being smarter and more effective with more.

It’s about taking whatever limited insights, experience, and intelligence we may possess, and using data analytics and smartly designed organic systems and processes to leverage our way to greater heights.

And for anyone out there, trying to succeed in competitive online business verticals, I hope to show you how you too can Live Simply with Complexity.

More to come…